appeal, affirming a judgment of the chancery division, which restrained the St. Catharines Milling & Lumber Co. from cutting timber on lands south of Wabigoon Lake in Algoma, claimed to be public lands of the province.1 Though the question at issue is not yet definitely decided, yet it is expedient to call attention to the main points involved, inasmuch as all the courts in Canada to which it has been referred have come to the same conclusion. The lands in question formed a portion of the territory declared, under the Boundary Award,' to be within the territorial limits of Ontario. In 1873 they were surrendered by the Indians to the government of Canada by the North-West Angle Treaty No. 3. In the answer of the defendants it was pleaded that the lands and timber thereon were, with other lands and timber in the district, until quite recently claimed by the Indians who inhabited that part of the dominion of Canada. That the claims of such Indians have always been. acknowledged by the various governments of Canada, and that such claims are, as respects the lands in question, paramount to the claim of the Crown as represented by the government of Ontario. That the government of Canada have acquired the Indian title to these lands in consideration of a large expenditure of money for the benefit of these Indians, and have for that

1 Sup. Court R., vol. 13, pp. 577-677. The St. Catharine's Milling & Lumber Co. (appellants), and the Queen, on the information of the attorney - general for the province of Ontario (respondent), on appeal from the court of appeal for Ontario. The matter has been appealed to the judicial committee of the privy council.

2 See infra, pp. 156-158, for a brief account of this award.

reason and by virtue of the inherent right of the Crown as represented by the government of Canada, alone the right to grant licenses to cut timber on the tract in dispute. The majority of the court decided that the boundary of the territory in the north-west angle being established, and the lands in question being found within the province of Ontario, they necessarily form part of the public domain of that section, and are public lands belonging to the same by virtue of sub-sec. 5 of sec. 92, and sec. 109 of the B. N. A. Act, as to lands, mines, minerals and royalties, and of sec. 117, by which the provinces are to retain all their property not otherwise disposed of by that act, subject to the right of the dominion to assume any lands or public property required for fortifications or for the defence of the country. Only those lands specifically set apart and reserved for the use of the Indians are "lands reserved for Indians " within the meaning of sec. 91, item 24, of the B.N.A. Act. In the course of their opinions, the majority of the judges dwelt on certain points interesting to the historical as well as legal student. They laid it down that "on the discovery of the American continent, the principle was asserted or acknowledged by all European nations that discovery followed by active possession gave title to the soil to the government

1 Ritchie C.J., Taschereau and Henry JJ.; Strong and Gwynne JJ., dissenting. The most elaborate opinion in the whole question is by Boyd C., in the Chancery division of the high court of justice for Ontario (10 O.R., 196). The opinions of Strong and Gwynne JJ., on the other side, merit a careful study.

2 See app. A. to this work for full text of these sections.

by whose subjects, or by whose authority, it was made, not only against other European governments, but against the natives themselves. While the different nations of Europe respected the rights1 of the natives as occupants, they all asserted the ultimate dominion and title to the soil to be in themselves." That such was the case with the French Government in Canada, during its occupancy thereof, is an incontrovertible fact. The king was vested with the ownership of all the ungranted lands in the colony as part of the crown domain, and a royal grant conveyed the full estate and entitled the grantee to possession.3 When by the treaty of 1763, France ceded to Great Britain all her rights of sovereignty, property and possession over Canada, it is unquestionable that the full title of the territory ceded become vested in the new sovereign, and that he thereafter owned it in allodium as part of the crown domain, in as full and ample a manner as the king of France had previously owned it. At no time had the sovereign of Great Britain ever divested himself of the ownership of the public lands to vest it in the Indians. For obvious political reasons and motives of humanity and benevolence, it has, no doubt, been the general policy of the crown, as it had been at the times of the French authorities, to respect the claims of the Indians. \But this, though it unquestionably gives them a title to the favourable consideration of the government, does not give

1

1 Judge Taschereau very properly thinks "claims" the proper word here.

2 Sup. Court of Louisiana, cited by Taschereau J., s. 4, La. An. 141.

3 Taschereau, J., 644.

them any title in law-any title that a court of justice can recognize as against the crown. The Indians must in the future, every one concedes it, be treated with the same consideration for their just claims and demands that they have received in the past, but it will not be because of any legal obligation to do so, but as a sacred political obligation in the execution of which the State must be free from judicial control.1

In 1882 the Quebec legislature passed a statute2 "to impose certain direct taxes" on banks, insurance companies, and every incorporated company carrying on any labour, trade or business in the province. Payment was resisted of the taxes thereby imposed, and the queen's bench reversed a decision of the superior court that the Quebec legislature had no power to pass the statute, on the grounds that the tax is a direct one and that it is also a matter of a local or private nature in the province, and so falls within the jurisdiction of the provincial legislature. The case was carried before the judicial committee of the privy council, who affirmed the judgment of the queen's bench that the tax in question was direct taxation within class two of section ninetytwo of the federation act. They also laid it down that a corporation doing business in the province is subject to taxation under section ninety-two, sub-section two, though all the shareholders are domiciled or resident out of the province.3

1 Taschereau J., 648, 649. See also opinion of Henry J., 630. 245 Vict. (Q), c. 22.

310 Leg. News, 259-264.-Their lordships add: "There is nothing in the previous decisions on the question of direct taxation which is adverse to this view. In the case of the Queen

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Reference has been made, in connection with the case just cited, to the dispute between the governments of Ontario and Canada as to the boundary of the province on the north and west. This question has given rise to a vast amount of legal and political literature since the acquisition of the North-West Territories, and it is necessary here to state briefly its prosent position. In 1878 three arbitrators were chosen on behalf of the Dominion and Ontario governments to come to a settlement of the question. They arrived subsequently at a unanimous decision, but while the Ontario government accepted the the award as satisfactory, the Dominion government took no steps whatever in the matter. The subject remained in abeyance until 1884 when a case was arranged for reference to the judicial committee of the privy council, but before the case was argued, the do

Insurance Company [3 App. Ca. 1090, supra, p. 127], the disputed tax was imposed under cover of a license to be taken out by insurers. But nothing was to be paid directly on the license, nor was any penalty imposed upon failure to take one. The price of the license was to be a percentage on the premiums received for insurances, each of which was to be stamped accordingly. Such a tax would fall within any definition of indirect taxation, and the form given to it was apparently with the view of bringing it under class nine of section ninety-two, which relates to licenses. In Reed's case (10 App. Ca. 141) the tax was a stamp duty on exhibits produced in courts of law, which in a great many, perhaps in most, instances would certainly not be paid by the person first chargeable with it."

1 Ann. Reg. 1878, pp. 187-194. The arbitrator for Ontario was Chief Justice Harrison; for the Dominion, Sir Francis Hincks; Sir Edward Thornton, British Minister at Washington, was the third, chosen by the two conjointly.