SUPREME COURT OF CANADA

Morguard Properties Ltd. v. City of Winnipeg, [1983] 2 S.C.R. 493

Date: 1983-12-15

Morguard Properties Ltd., Aronovitch & Leipsic Limited, Kensington Building Ltd., Black & Armstrong (1977) Ltd., Dordan Drugs Ltd., operating as Shoppers Drug Mart, Delafield Properties Ltd., Carlton Realty Company Limited, Omega Realty Ltd., Mitchell Consolidated Stores Ltd., Canadian Imperial Bank of Commerce, Core Industries Ltd., Domcan Management Advisory Services Ltd., Ruth Realty Company Limited, L & B Corporation Ltd., Sylvia C. Wolfe Enterprises, Sylvia C. Wolfe, LaPorte Realty Ltd., Rivan Kenneth Halprin, The Permanent, Mercury Holdings Ltd., Peter Gaye Fur Gallery, James N. Connacher, Famous Players Limited, Canada Trust, North West Trust Company, National Trust Company Limited, Harvey Zane Hurtig, Moyer Morton Hurtig, Joyce Diner, North Star Inn Ltd., Adason Properties Limited, Eaton's, Thomas Gary Investments Limited, Holt, Renfrew & Co., Limited, Metropolitan Stores of Canada Limited, Excelsior Life Insurance Company, S.F.M. Investments Ltd., Tritt Investments Ltd., Portage Holdings Ltd., Horizon Investments Ltd., Clifford's Ladies' Wear Ltd., and Hudson's Bay Company Appellants;

and

The City of Winnipeg Respondent.

File No.: 17350.

1983: October 18; 1983: December 15.

Present: Ritchie, Beetz, Estey, Chouinard and Wilson JJ.

ON APPEAL FROM THE COURT OF APPEAL FOR MANITOBA

Assessment — Freeze — The City of Winnipeg Act providing review procedure — Whether legislation instituting 'freeze program" superseded the provisions of The City of Winnipeg Act — Whether Board of Revision prohibited from hearing assessment complaints — Construction of taxing statute — An Act Respecting the Assessment of Property for Taxation in Municipalities in 1981 and 1982, 1980 (Man.), c. 71, s. 4(1) — The City of Winnipeg Act, 1971 (Man.), c. 105, s. 159(3).

[page 494]

Respondent applied to the Manitoba Court of Queen's Bench for an order prohibiting the Board of Revision of the City of Winnipeg from considering appellants' applications, made pursuant to s. 159(3) of The City of Winnipeg Act, to lower the 1981 assessment of their properties. The respondent maintained that s. 4(1) of An Act Respecting the Assessment of Property for Taxation in Municipalities in 1981 and 1982 (hereinafter referred to as the 1980 Act) estopped the Board from reassessing the appellants' properties. Section 4(1) provides that "the same level of values as were used in assessing lands ... for the year 1980" shall apply when making assessments for the years 1981 and 1982. The Court granted respondent's application, concluding that the effect of the section was to freeze the assessment of property for the years 1981 and 1982 to the assessment established for the year 1980. The Court of Appeal confirmed the judgment, holding that the words used in the 1980 Act superseded the provisions of The City of Winnipeg Act, including the provision respecting assessment appeals. Hence this appeal to determine whether s. 4(1) of the 1980 Act has the effect of suspending the operation of s. 159(3) of The City of Winnipeg Act.

Held: The appeal should be allowed.

The Board of Revision of the City of Winnipeg had jurisdiction to proceed with appellants' applications. Section 159(3) of The City of Winnipeg Act which gave taxpayers a basic right to attack an assessment when the amount did not bear a fair and just relation to the assessment of other lands was not altered by s. 4(1) of the 1980 Act. A legislature must, in order to affect or reduce a taxpayer's right, do so expressly. Here, although the 1980 Act made certain reference to The City of Winnipeg Act, there was no relationship between s. 4(1) of the 1980 Act and s. 159(3) and there was no expressed intention—nor even one implied—by the Legislature in the enactment of the 1980 Act to reduce the limits open to the taxpayer in opposing on legal grounds an assessment established under The City of Winnipeg Act, at least as far as the rights arising under s. 159(3) are concerned. The 1980 Act did not purport to repeal or amend any provision of The City of Winnipeg Act. Rather, certain specific directives relating to the preparation of assessments for specified future years have been superimposed upon pre-existing assessment statutes. The amount of the assessed value was not in terms frozen; the new legislative program was aimed at the technique to be applied in determining the assessment. In short, the yardstick, but not the assessment, was frozen.

[page 495]

Partington v. Attorney-General, (1869) L.R. 4 H.L. 100; Tennant v. Smith, [1892] A.C. 150; Canadian Northern Ry. Co. v. The King (1922), 64 S.C.R. 264; Nicholls and Robinson v. Cumming (1877), 1 S.C.R. 395; Eastman Photographic Materials Co. v. Comptroller-General of Patents, Designs, and Trade-Marks, [1898] A.C. 571; Assam Railways and Trading Co. v. Commissioners of Inland Revenue, [1935] A.C. 445 applied; Lumsden v. Commissioners of Inland Revenue, [1914] A.C. 877; The King v. Crabbs, [1934] S.C.R. 523, considered; Re Anti-Inflation Act, [1976] 2 S.C.R. 373; The King v. Fraser Companies Ltd., [1931] S.C.R. 490, distinguished.

APPEAL from a judgment of the Manitoba Court of Appeal, [1982] 5 W.W.R. 149, 137 D.L.R. (3d) 753, 19 M.P.L.R. 110, 17 Man. R. (2d) 148, dismissing appellants' appeal from a judgment of Wilson J., 16 M.P.L.R. 62, 17 Man. R. (2d) 156, prohibiting the Board of Review of the City of Winnipeg from hearing appellants' applications for a review of assessments. Appeal allowed.

R. A. L. Nugent, Q.C., and M. J. Mercury, Q.C., for the appellants.

M. S. Samphir, for the respondent.

The judgment of the Court was delivered by

ESTEY J.—The issue in this appeal is the scope of the Manitoba legislation which purports to limit assessments in the City of Winnipeg (and elsewhere in the Province of Manitoba but not here in issue) under The City of Winnipeg Act, 1971 (Man.), c. 105 and An Act Respecting the Assessment of Property for Taxation in Municipalities in 1981 and 1982, 1980 (Man.), c. 71 (hereinafter referred to as the "1980 Act"). The relevant facts are limited. In 1979 the Province of Manitoba established by order in council a Commission of Enquiry into the real property assessment in the Province with particular direction to:

inquire into and report on all aspects of real property assessment in Manitoba, including:

(a) the level at which real property should be assessed in Manitoba.

[page 496]

In its Interim Report on February 15, 1980 the Commission recommended:

That legislation be introduced at the 1980 Session of the Manitoba Legislature to maintain existing levels of assessment until December 31st, 1982 in order to provide an opportunity for the Committee to carry out its mandate and report the results of its research and deliberations.

By a statute enacted by the Legislature and assented to on July 29, 1980, the Province of Manitoba in the 1980 Act, supra, provided as follows:

1980 levels to apply in Winnipeg assessments.

4(1) Notwithstanding The City of Winnipeg Act or any other Act of the Legislature, but subject as herein provided, in making assessments for assessment rolls for The City of Winnipeg for the year 1981 and for the year 1982, the assessor shall assess lands, buildings and personal property at the same level of values as were used in assessing lands, buildings and personal property in preparing the assessment roll for The City of Winnipeg for the year 1980.

Pursuant to s. 187(6) of The City of Winnipeg Act, the appellants made application to the Board of Revision of the City of Winnipeg (hereinafter referred to as "the Board") for a lowering of the assessment of the properties of the appellants in Winnipeg. The application for revision of assessments was presented upon the ground that:

the assessed value of the land in the assessment does not bear a fair and just relation to the amounts at which other lands in the City of Winnipeg are assessed and that there is not a fair and equitable relation between the said assessed value and the fair market value of the land, having regard to those other lands.

It is understood by both parties to this appeal that the application to the Board was made pursuant to s. 159(3) of The City of Winnipeg Act, supra, which provides as follows:

Presumption as to validity of assessments.

159 (3) Notwithstanding any other provision herein, an assessment of any land shall not be deemed to have been improperly made or to be fixed at an unreasonable, unjust, or improper amount if the amount at which the

[page 497]

land is assessed bears a fair and just relation to the amounts at which other lands in the city are assessed.

The City thereupon made application in the Manitoba Court of Queen's Bench for an order prohibiting the Board from considering the application of the appellants concerning the valuations of their respective properties as entered in the assessment roll of the City. The learned justice of first instance, after analysing the provisions of the two statutes mentioned above, stated:

The "level of values" adopted by the City's assessor for 1980, then, is so carried forward. And however wrong they may have been, and however that "level of values" may have been adopted by the assessor, taxpayer and City alike must accept the same "level of values" for 1981 and 1982.

His Lordship, in construing s. 4(1) in the context of the 1980 Act and its relationship to the functioning of The City of Winnipeg Act, went on to state:

"Level" refers to horizontality, the Concise Oxford English Dictionary tells us, and where—as respondents would be the first to claim—"horizontality" in the sense here does not mean evenness, absolute similarity, it is to be read, I think, as referring to the comparable position of one to another, the position on the plane, or standard, vis-à-vis others properly comparable. To take the example quoted in the O.E.D., " 'to find one's own or its level', said of persons or things arriving at their proper place with regard to those around or connected with them". The level of valuation of property "A", i.e. vis-à-vis that for property "B".

It might be thought, on the contrary, that the expression "level of values" under examination actually incorporated the test of s. 159(3), that is to say the relationship in value as between like properties. However, the Court continued:

"Level of values" as I read that phrase, incorporates not only the absolute valuation of any individual property but also the rank of that property in the "level of values" presented by the assessment, the ranking of the property vis-à-vis other subject to tax.

The learned judge concluded that the effect of the 1980 Act was to freeze the assessment of property

[page 498]

for the years 1981 and 1982 to the assessment established for the year 1980.

The Court of Appeal unanimously confirmed the conclusion reached below. After quoting extensively from the Interim Report of the Commission of Enquiry and the interim recommendations, set out, supra, the Court stated through Matas J.A.:

In my view, the Legislature, sharing the concerns of the committee, agreed to present wide ranging changes under the Winnipeg Act until the review committee had had an opportunity to report the results of its research and deliberations. The words used in Bill 100 supersede the provisions of the Winnipeg Act, including the provision of s. 159(3). No provision is made in Bill 100 to give the board jurisdiction to embark on the kind of reconsideration claimed by the appellants.

With great respect to the learned justices in the courts below I have, upon an examination of the above-mentioned statutes, come to the opposite conclusion, namely that the Board had jurisdiction to proceed under those statutes with the application made by the appellants for the review of the 1981 assessments with respect to their lands.

First of all, in order to clear aside some subordinate issues before dealing with the main issue of interpretation of the relevant statutes, reference should be made to the use made below of the Interim Report of the Commission of Enquiry. Counsel for both the appellants and respondent have drawn freely upon the Interim Report and its conclusions, and no objection was taken by one or the other to this practice. It has, of course, been long settled that, in the interpretation of a statute (and here I do not concern myself with the constitutional process as, for example, in the Re Anti-Inflation Act judgment ([1976] 2 S.C.R. 373)), the report of a commission of enquiry such as a Royal Commission may be used in order to expose and examine the mischief, evil or condition to which the Legislature was directing its attention. However, in the interpretation of a statute, the court, according to our judicial philosophy, may not draw upon such reports and commentaries, but must confine itself to an examination of the words employed by the Legislature in the statutory provision

[page 499]

in question and the context of that provision within the statute. In the words of Lord Wright:

... on principle no such evidence for the purpose of showing the intention, that is the purpose or object, of an Act is admissible; the intention of the Legislature must be ascertained from the words of the statute with such extraneous assistance as is legitimate:.. .

(Assam Railways and Trading Co. v. Commissioners of Inland Revenue, [1935] A.C. 445 at p. 458.)

The logic is, of course, inexorable that the Legislature may well have determined not to follow the recommendations set out in the report of the Commission which had earlier been placed before the House. On the other hand, as we have seen in Eastman Photographic Materials Co. v. Comptroller-General of Patents, Designs, and Trade-Marks, [1898] A.C. 571 at p. 575, Lord Halsbury stated:

... no more accurate source of information as to what was the evil or defect which the Act of Parliament now under construction was intended to remedy could be imagined than the report of that commission.

The Interim Report of the Commission of Enquiry was a response to the plan of the City Assessors to replace the 1957 data base year with a 1975 data base year. The Report indicated that such a plan "would not be a problem were it not for the manner in which inflation has affected different classes of property to varying degrees", and went on to state that the failure to implement more frequent reassessment programs in the past had resulted in some significant inequities between classes of properties, individual properties, and taxing jurisdictions. It is clear from the Report that these taxation shifts and resulting inequities were matters of some concern, and this factual context may then be seen as evidence of the evil or defect subsequently addressed by the Legislature. As such, the Report falls within the principle expressed above in Eastman Photographic, supra, and is admissible for this limited purpose.

I prefer, however, to resolve the issue raised in this appeal by directly examining the language

[page 500]

employed by the Legislature, first in The City of Winnipeg Act, and second, in the 1980 Act.

The establishment of the assessment roll, upon the basis of which revenues are derived, commences in s. 158(1) of The City of Winnipeg Act which states in part:

At least once in each three consecutive years, the assessor shall, after enquiry, and aided by such information as may be furnished to him, make a valuation of every parcel of rateable property in the city according to his best judgment, and enter such valuations in an assessment roll to be prepared by him annually in an appropriate form approved by council.

It is common ground that the assessor for the City has, in the process under the assessment statute, determined the assessment on the basis of the value of land in the City of Winnipeg in 1957. Accordingly, an assessment roll is produced annually as the basis of municipal taxation and is based on at least a triennial re-evaluation employing for that purpose 1957 land values. It is the scheme of the statute that the assessment roll shall be prepared in advance of the taxation year, for example, in the year 1970, for the collection of taxes in the year 1971. It is the application of the mill rate, as struck by the municipal council, to the assessment values that produces the tax liability and hence the revenue for the municipal government.

The statute has extensive appeal procedures including procedures for the exemption from assessment, and other procedures including the assessment of new construction completed in the year for which taxation is computed.

Section 159(1) requires the assessment of land (as distinguished from the buildings thereon) "at its value at the time of the assessment". The combined assessment of land with buildings thereon is also provided for in the section, and the assessment of the latter includes an amount equal to only two-thirds of the value of the buildings in question. Section 159(3) (which I have already set forth) then deems the assessments to be valid and regular and not to include unreasonable, unjust or improper amounts providing "the amount at which the land is assessed bears a fair and just relation to

[page 501]

the amounts at which other lands in the city are assessed". This is the seed from which this appeal has sprung.

The 1980 Act makes no reference to ss. 158 or 159, although it does make frequent reference to The City of Winnipeg Act. For example, s. 2(b) provides:

2 Subject to section 1,

(b) in applying this Act to The City of Winnipeg or to an assessment or proceeding relating to assessment in The City of Winnipeg, words and expressions used in this Act have the same meaning as they have in The City of Winnipeg Act.

Unhappily, the expression "level of values" as employed in s. 4(1), supra, is not defined in either the 1980 Act or The City of Winnipeg Act. The 1980 Act, consisting as it does of only seven sections, does not purport to repeal or amend any provision of The City of Winnipeg Act. It certainly does not purport to do so with reference to s. 159(3), supra, which invites the review of an assessment when that assessment does not relate fairly and justly to the assessment in respect of like lands. Section 3 makes the 1980 Act applicable to all assessment proceedings before a Court of Revision when "dealing with an application by way of a complaint or in any proceeding respecting the revision of an assessment roll". Section 5 provides for changes in assessments based on change in circumstances. The section states in part:

5 Where after the assessment of any land, building or personal property was made for the assessment roll for a municipality for 1980, the value of the land or building is altered because

(a) a local improvement benefiting the land, building or personal property is installed or constructed; or

(d) the land, building or personal property is improved or altered in a manner not reflected in the assessment thereof for the assessment roll for the previous year; or

(e) a building is erected, constructed or completed on land and the erection, construction or completion of

[page 502]

the building is not reflected in the assessment of the property for the assessment roll for the previous year;

These sections also provide for changes when the land or building has been altered because of the registration of a new plan of subdivision, zoning variations, or because the use of a building has been changed, after the assessment for the year 1980 had been made. Section 5 in this manner provides a mechanism for the reassessment of property, or a form of property which was not existent in 1980, but which must be taken into account for the assessment in the year 1981 or 1982. The section then goes on to provide that the assessor shall assess the land and building as though such changes had been made "prior to the assessment of the land or building for the assessment roll for the year 1980 ... ". Sections 6 and 7 provide for the correction of errors or omissions and for the coming into force on royal assent.

Thus the issue squarely arises as to whether the passage of s. 4(1) in the 1980 Act has the effect of suspending the operation of s. 159(3) of The City of Winnipeg Act during the so-called freeze of assessments or values.

Section 4 does not, of course, deal directly with the assessment produced under The City of Winnipeg Act. It simply provides that "the same level of values as were used in assessing lands . . . for the year 1980" shall apply when making assessments for the years 1981 and 1982. Nothing is mentioned about applying and using the assessments of 1980 for the years 1981 and 1982, and nothing is said of the continuance or otherwise of other proceedings or elements in the assessment process such as s. 159.

When governments elsewhere were faced with the need to provide a plateau or a maintenance of the status quo pending a revision or remodelling of the assessment procedures, more precise provisions were enacted which clearly froze the actual assessments. In the Province of Ontario a somewhat similar "freeze" program was instituted by legislation:

[page 503]

The Assessment Amendment Act 1971, 1971 Ont., vol. 2, c. 79, s. 13. The Legislature on that occasion expressly amended The Assessment Act by adding s. 85 which provides in part:

... the assessment roll of every municipality prepared for the year 1970 for taxation in 1971 shall be the assessment roll of the municipality in the years 1971 to and including 1974 and the assessments of all real property as set forth on the 1970 assessment roll shall be the assessments of the real property ...

In British Columbia a similar program was instituted by legislation in 1974, the Assessment Amendment Act 1974, 1974 (B.C.), c. 105, s. 1, which expressly amended the Assessment Act and which provided in part:

... land and improvements shall be assessed at the same value and on the same basis at which the land and improvements were assessed for the calendar year 1974.

The amending statute went on to provide for the additional assessment of changes in the physical condition of land or in its zoning, and again provided in those instances for an assessment on the same basis as if those changes had occurred and been taken into account "in the preparation of the assessment roll for the calendar year 1974". In both provinces, therefore, the legislation set out to freeze the assessment at a previously determined amount, and to continue that amount as the assessment for the years covered by the amending legislation. The assessment process was not altered, but rather the assessed value of the property was pre-determined by reference to a prior assessment year.

Even more significant for the purposes of this appeal is the fact that both Legislatures considered it necessary to specifically reinstate or assure the right of the taxpayer to seek relief when the assessment is "inequitable". The Ontario provision is found in the amending act as s. 90:

... the amount of any assessment of real property shall not be altered unless the Assessment Review Court, judge, Board or court is satisfied that the assessment is inequitable with respect to the assessment of similar real property in the vicinity, and in that event the assessment of the real property shall not be altered to any greater

[page 504]

extent than is necessary to make the assessment equitable with the assessment of such similar property.

The inclusion of this provision in the amending statute was, no doubt, considered necessary in order to relieve against the otherwise clear finality of the freeze imposed by s. 85, which had been newly added to The Assessment Act by the same amending legislation. In British Columbia, similar power is given to the assessor in the amending legislation itself in which subs. (7) (added to the Assessment Act by the amending legislation) provides that:

... the commissioner may, for the purpose of correcting disparities in assessment that may exist within a class of land and improvements, reduce the assessment of any land and improvements.

The amending technique applied by the Manitoba Legislature stands in stark contrast to that adopted in the other two provinces. As we have seen, the Manitoba legislation does not amend, by express or by necessary inference, the pre-existing assessment legislation, either by the deletion from or the addition to such legislation of any specified provisions. Rather, certain specific directives relating to the preparation of assessments for specified future years have been superimposed upon the existing statutes. The amount of the assessed value is not in terms frozen; the new legislative program is aimed at the technique to be applied in determining the assessment. In short, the yardstick and not the assessment is frozen. Reduced to its bare essentials, s. 4(1), with respect to this appeal, simply specifies that the assessor shall, in preparing the new assessment of property in the City of Winnipeg, do so "at the same level of values as were used in assessing lands . . . for the year 1980". Some meaning must be attributed to the word "level" as otherwise it is mere surplusage, and courts in the application of the principles of statutory construction endeavour, where possible, to attribute meaning to each word employed by the Legislature in the statute. Were the object of the statute merely to require assessments for the years 1981 and 1982 to be identical in amount with the assessment for the year 1980, the legislation could have simply done so, as was most clearly done in

[page 505]

the Ontario legislation. Instead of adopting that direct course, the Legislature, and a court must consider that it did so deliberately, adopted the expression "level of values". Such a term does, of course, call to mind the whole process of determining the resultant amount of assessment, and not merely a process of copying in numbers from the earlier assessment. It is not without significance that the Legislature and the Executive of the Province of Manitoba, in preparing and enacting the 1980 Act, had before them the legislation of the other two provinces.

What then is the impact, if any, of the 1980 Act upon the application, and indeed the continued existence in The City of Winnipeg Act, of s. 159(3)? In determining the answer to this question the entire s. 159 should be examined. Subsection (1) thereof provides:

Land, as distinguished from the buildings thereon, shall be assessed at its value at the time of the assessment.

The word "value" in that subsection must be included in the expression "values" in s. 4(1) of the 1980 Act, and indeed this was conceded by counsel for the City of Winnipeg. That being so, s. 159(1) is perhaps necessarily affected and revised by the edict of s. 4(1), at least to the extent that the expression "at the time of the assessment" in s. 159(1) must, for the duration of the 1980 Act, refer to the year 1980 and not the years 1981 and 1982 for the purpose of determining assessments for those years.

Subsection (2) relates to the same process with regard to the assessment of buildings. There would appear to be no impact upon the technique adopted for the combining of the values of land and buildings in the ultimate assessment as established in s. 159(2), by reason of the introduction of s. 4(1) in 1980, except that the term "value" where it appears in s. 159(2) must again refer to value in the year 1980, and not in the subsequent years of assessment.

We come then to subs. (3) which is the core problem raised in this appeal, and for convenience I repeat it here:

[page 506]

Notwithstanding any other provision herein, an assessment of any land shall not be deemed to have been improperly made or to be fixed at an unreasonable, unjust, or improper amount if the amount at which the land is assessed bears a fair and just relation to the amounts at which other lands in the city are assessed.

There is no dispute that the process of assessment of land and buildings in the City of Winnipeg is undertaken by the appropriate authorities acting under the authorization of The City of Winnipeg Act. It is only to the extent that the 1980 Act affects The City of Winnipeg Act that the assessment procedures are in any way altered. There would appear to be no relationship between s. 4(1) of the 1980 Act and s. 159(3) above. There is neither an express interrelationship nor a necessary interpretative involvement of the latter enactment with the pre-existing enactment. Subsection (3) gives the taxpayer a basic right to attack an assessment when the amount does not bear a fair and just relation to the assessment of other lands. It is obvious that this subsection creates a right to relief against discrimination or improper preferential treatment in the taxation process. It is not necessary for the Court in this proceeding to determine the precise meaning of the subsection. It is sufficient to observe in this appeal that the comparison is between like lands, and the taxpayers' rights arise only where an unfair or unjust relationship arises between the amounts of assessment of the taxpayers' land and the assessment of like lands.

This provision of The City of Winnipeg Act is of fundamental importance in the assessment scheme adopted by the Legislature for the City. It has been a part of the legislative program for the raising of municipal revenues for many years. It is of importance not only to the taxpayer, but to the government of the City of Winnipeg, because it ensures uniformity of treatment and justice in taxation to the entire land and building owning population, and through them to the occupiers of all the buildings in the City of Winnipeg. Naturally, one would expect to find in any amending legislation an express reference to this right in the

[page 507]

taxpayer if the Legislature had the intention of altering or revising this right in any way.

It has been said in argument that an interpretation along the lines indicated above of the relationship between the two statutes would create a declining revenue base for the municipality. To this submission there are two answers. First of all, the determination of the levels of municipal revenues is up to the Province of Manitoba and not up to this Court. If the statutes, when construed in accordance with the proper canons of construction, produce an unsatisfactory revenue conclusion, the political process and not the courts must seek a solution. The second answer is that, in any case, it is the mill rate, under the control of the municipality within the limits of its parent statutes, which determines the level of municipal revenues. When the assessment roll is diminished by the revision process, the municipality has its remedy in the mill rate. There may be a time lag discrepancy, but again this is a problem for resolution by the political process and is of no concern to the judicial process when properly acting within its proper limits in the community's scheme of law.

For centuries, statutes levying taxes and like imposts on the citizen have been read strictly in the sense that the Legislature must, in order to reduce a right in the taxpayer, say so in unmistakably clear terms.

Certainly the leading case on this point is Partington v. Attorney-General, (1869) L.R. 4 H.L. 100, in which Lord Cairns stated the guiding principle at p. 122 as follows:

If the person sought to be taxed comes within the letter of the law he must be taxed, however great the hardship may appear to the judicial mind to be. On the other hand, if the Crown, seeking to recover the tax, cannot bring the subject within the letter of the law, the subject is free, however apparently within the spirit of the law the case might otherwise appear to be.

A few years later in Tennant v. Smith, [1892] A.C. 150 at p. 154, Lord Halsbury stated:

[page 508]

This is an Income Tax Act, and what is intended to be taxed is income. And when I say "what is intended to be taxed," I mean what is the intention of the Act as expressed in its provisions, because in a taxing act it is impossible, I believe, to assume any intention, any governing purpose in the Act, to do more than take such tax as the statute imposes.

In a Canadian case, Canadian Northern Ry. Co. v. The King (1922), 64 S.C.R. 264 at p. 275, Brodeur J. reiterated the principle and provided an explanation for it:

A law imposing taxation should always be construed strictly against the taxing authorities, since it restricts the public in the enjoyment of its property.

The leading Canadian case on this point is The King v. Crabbs, [1934] S.C.R. 523, in which this Court dismissed the appellant's claim to recover $499.48 due under the Special War Revenue Act for stamp tax on sale or transfer of stocks and shares. The sections in question enacted a prohibition and imposed a penalty upon the person acting in contravention. After reviewing the leading English cases on the interpretation of taxing statutes, Hughes J., speaking for the Court, wrote at p. 527:

It does not follow, however, that the statute creates a civil obligation on the part of such persons to pay the value of the necessary stamps, or indeed, any sum, to the Crown. These sections do not profess to create such an obligation ... The settled principles . . . do not permit us to read these sections as constituting such an obligation.

The provisions of the 1980 Act presently before the Court are said by the respondent not only to impose a freeze but also to remove an important appeal recourse from the taxpayers. The principles enunciated above in Partington v. Attorney-General, Tennant v. Smith and Canadian Northern Ry. Co. v. The King, supra, are even more strongly adhered to when rights of the citizen are affected. In Nicholls and Robinson v. Cumming (1877), 1 S.C.R. 395, Ritchie J. made the following statement at p. 422:

When a statute derogates from a common law right and divests a party of his property, or imposes a burthen on him, every provision of the statute beneficial to the party

[page 509]

must be observed. Therefore it has been often held, that acts which impose a charge or a duty upon the subject must be construed strictly and . . . it is equally clear that no provisions for the benefit or protection of the subject can be ignored or rejected.

In more modern terminology the courts require that, in order to adversely affect a citizen's right, whether as a taxpayer or otherwise, the Legislature must do so expressly. Truncation of such rights may be legislatively unintended or even accidental, but the courts must look for express language in the statute before concluding that these rights have been reduced. This principle of construction becomes even more important and more generally operative in modern times because the Legislature is guided and assisted by a well-staffed and ordinarily very articulate Executive. The resources at hand in the preparation and enactment of legislation are such that a court must be slow to presume oversight or inarticulate intentions when the rights of the citizen are involved. The Legislature has complete control of the process of legislation, and when it has not for any reason clearly expressed itself, it has all the resources available to correct that inadequacy of expression. This is more true today than ever before in our history of parliamentary rule.

The impact of the version of the amending statute contended for by the respondent is even more far-reaching when it is realised that the effect of the 1980 Act, whatever it may be properly found to be, has been extended by Bill 33, 1982 (Man.), c. 29, which renders the 1980 Act applicable indefinitely to all years after 1980, and not only to the years 1981 and 1982. The loss of taxpayers' rights (if there is any such loss on a proper construction of the statute, as I believe there has been), is thus legislatively permitted. This would seem to render less likely the prospect that the Legislature adopted and proceeded with the intent attributed to it by the respondent in its submissions. Interim legislation with temporary effect might lend itself to a construction which would be repellent, when considered on the basis of a permanent enactment with consequences unlimited in time. Technically, the focus of a court in

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construing the statute is on the statute itself, with some permitted reference to statutory antecedents but without reference to conduct in the political arena thereafter. In the unusual task presented to the courts on this appeal, a consideration of post-legislative activity is made relevant by the submissions made on behalf of the taxpayers with reference to what was said to be a temporary freeze pending a realignment of the level of assessment. In any event, having concluded, as I have, that the meaning of s. 159(3) is not that attributed to it by the respondent, reference to Bill 33, which was submitted to us by the appellants on the hearing of this appeal, simply buttresses the result.

It should be remembered, however, that the construction difficulty does not arise unless there is some ambiguity to start with. As Lord Cairns stated in Partington v. Attorney-General, supra, if the subject comes within the letter of the law, he must be taxed. If he does not, the Court will not second guess the Legislature in order to impose liability on the subject. The only qualification of this approach lies in the principle that the statute must be read as a whole. The application of this principle in The King v. Fraser Companies Ltd., [1931] S.C.R. 490 resulted in an interpretation unfavourable to the taxpayer. Smith J., speaking for the Court at p. 492, wrote:

... I am unable to take this view of the meaning and effect of these provisions of the Act. To so construe them is to put a narrow and technical construction upon the precise words used in clause (d), without taking into consideration the meaning and intent of the statute as a whole. It seems to me clear that the real intention was to levy a consumption or sales tax of four per cent on the sale price of all goods produced or manufactured in Canada, whether the goods so produced should be sold by the manufacturer or consumed by himself for his own purposes.

The role of the statutory context was also discussed by Viscount Haldane, Lord Chancellor, in Lumsden v. Commissioners of Inland Revenue, [1914] A.C. 877 at pp. 896-97:

My Lords, I said at the beginning that the duty of judges in construing statutes is to adhere to the literal construction unless the context renders it plain that such a construction cannot be put on the words. This rule is

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especially important in cases of statutes which impose taxation.

The courts, therefore, must approach a provision such as s. 4(1) of the 1980 Act on the basis that it operates in the reduction of the rights of the taxpayer in The City of Winnipeg Act only to the extent that it expressly so provides. With all due respect to those who have expressed views to the contrary, I can find no expressed intention by the Legislature in the enactment of the 1980 Act to reduce the limits open to the taxpayer in opposing on legal grounds an assessment established under The City of Winnipeg Act, at least as far as the rights arising under s. 159(3) are concerned. There is neither an express nor a necessarily implied relationship between the two statutes. It may well be that a taxing statute can, by necessary implication falling short of an express provision, gather in a citizen and impose upon him or her a new tax burden. It need not always be bald and express. In the provisions now before the courts in these proceedings, no such necessary implication is present, and consequently I would invoke one of the oldest canons of interpretation employed by the courts in the application of the statutes of the land, namely that a statute imposing a tax burden must clearly do so, otherwise the complaining citizen remains outside the operation of the taxing program. In this case it is not the assessment which directly imposes the tax burden, for the role of the assessment is simply as a multiplicand, with the multiplier being the mill rate and the product being the realty taxes; but the distinction is without practical significance as it is the assessment which starts the process and which inevitably increases the burden on the taxpayer if the assessment is improperly enlarged.

It is not, of course, the role of the Court to determine whether an assessment is unduly high or unduly low, or indeed if it need be revised at all. That is the role of the tax tribunal, here the Board of Revision of the City of Winnipeg. It is to that Board that the appellants took their complaint. In my view, again with the utmost respect to those expressing different opinions, it is to that Board which the parties must now return for the proper

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application of s. 159(3) and s. 4(1) to the assessments prepared in respect of the appellants' holdings by the authorities of the City of Winnipeg. I would therefore allow the appeal and set aside the order of prohibition as issued by the Manitoba Court of Queen's Bench, with costs to the appellants.

Appeal allowed with costs.

Solicitors for the appellants: Thompson, Dorfman, Sweatman, Winnipeg.

Solicitor for the respondent: F. N. Steele, Winnipeg.