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Meps, pletes, cherts, etc., mey be filmed at different reduction retioa. Thoee too lerge to be entirely included In one expoaure are filmed beginning in tlie upper left hend comer, left to right end top to bottom, ee many framea aa required. TIte foitowing dlagrama illustrate the method: Lea certes, plenchee, tablMux, etc., peuvent Atre fllmte i dee taux de rMuction diffArents. Lorsque le «locument eet trop grend pour Atre reproduit en un seul cilch4. 11 eet film* i pertir de I'engle supMeur geuche, de geuche A droite, et de liaut en bee, en prenent le nombre d'Imegee nAceaaeire. Las diagremmee suivanta iiluattant le mAthode. 1 2 3 1 2 3 4 5 6 •^^"7^ FORFEITURE or FORFEITURE OF CHARTER [From the Courriet de St Hyaeinthe, of Febraary 4, 1882.] The Minister of Justice, Sir Alexander Campbell, has lately given at Ottawa, a most important decision upon a petition asking to prosecute a Bank, in the name of Her Majesty, for forfeiture of charter. Such a petition was not unknown in the annals of the Ministry of Ju^icc, and, if we deem it proper to make it kndWb- now irt a special matiher, through the press, it is not that we have a hostile object in view against any one, but because all the Provinces of the Dominion are concerned in that petition, and all the citizens as well as Parliament are highly interested in knowing whether corporations may violate their charter, without having to fear the hand of justice,and, whether their influence over the government be great enough to impair it in the falfilrtient of its« dut)l^; The quejrtriOfV' of' right \ttiich Iktve hteix afgud^, have a close! connrsxion with sotae of the printipltes whidi> arl^- thfO. baiiisi of tbe( engl&lv coffetiMition', aird thereby, highly concern all classes of society. If the ideas emitted by the minister of justice be correct, it will become a necessity to redress the existing evil, and to adopt, in the parliamentary session which will begin in a few days, r\ legislation able to remove the defects of the law. It will become the duty of the government to consider seriously which is the wisest line of conduct to follow, in order that, in the future, the law may reach incorporated bodies by an act of parliament, in the same manner as it reaches private individuals. It will also become the duty of Parlia- ment to see that the scale of justice be so well regu- lated as not to turn more on one side than the other, 'SO as to make it an impossibility for the public interest to be wronged in one case more than another. s We understand fully that we place ourselves in a very unfavorable position by endeavoring to criticize the honorable minister on his way of seeing things and acting upon them, and we shall undoubtedly be reminded of it Yet, the decision which has been- given, and the strange principles invoked by Sir Alexander Campbell to support it, are of so important a nature, that we cannot flinch from our duiy. Hence, we deem it necessary to make a statement of the question, also, to draw the attention of Parliament on that decision and to show its danger ; this, we shall endeavor to do with the greatest moderation. Our remarks will be as short as possible. + Before entering upon our subject, let us remark that Sir Campbell had not to decide whether or not the Bank in question had violated its charter or infringed the privileges granted to it by law. This belonged to the court of Exchequer. The petition simply asked the minister of justice leave to prosecute the bank, at the same time, offering security for costs. The judgement of the Hon. minister is lengthy and very ably written ; we would be tempted to say that it is skilfully written. In the first part, it expresses the doubt whether it be within the power of a court of justice to annul the charter of a corporation existr ing by virtue of an act of parliament " X find no authority, it says, of a case where am " english court has assured to annul a charter oi in* " corporation created by act of parliament" It is possible that the Hon. minister did not find a precedent of this nature ; buttheio is something more powerful than a precedent, and that is a principle ; and the conclusion arrived at by Sir Campbell, which, decided him to set aside the petition, is well calcula- ted to surprise, especially coming from a man who possesses a long parliamentary experience, and who is bound to known thoroughly the mechanism of the english constitution. W c b 0I V : If Sir Campbell has looked over the autliorities. which were quoted for him, and especially the famous author, Blackstone, he must have seen that corporation . are constituted principally in two ways, either by act •of l*arliament, cr by royal charter, and that they may ^Come to an end by a forfeiture legally incurred. ** In England, says Blackstoue, the King's consent ■ " is absolutely necessary to the erection of any cor- <• poration, either impliedly or expressly given, and ** that consent is given either by act of Parliament, or «• by charter." ♦* The King, according to the same author, has also " the prerogative of erecting corporations, whereby a ' " number of private persons are united and knit to- ' "gether, and enjoy many liberties, powers and im- ■ *• munities in their politic capacity, which they were •• utterly incapable of in their natural." [i B. p. 497.] " All the other methods, therefore, whereby corpo- " rations exist, by common law, by prescription, and ■** by act of Parliament, are of the most part reducible ** to this of the King's letters patent, or charter of " incorporation." [2 E p. 275.] ;; :--:—- ;x These principles bdng laid down, Blackstone says that the general duties of all politic bodies considered ~ as corporations may be reduced to this only point, i.e., - that they are bound to act in conformity with the end. whatever it may be, for which they have been erected or instituted by their fbunden „j ^j;, ,:,,-y ^ ,■ ^ , . This being the case, it may happen aha it does happen sometimes that those corporations violate their charter and make a bad us^ of the power confered upon themr which h not astonishing, since they are foade up of individuals subject to human frailties, and liable as well as private persons, to deviate from th^ieiid of their institutioti. For this reason the law hi^is ill^inted suitiHc peif^s to visit thefn,ta htquire into aQd to correct aU IrrqruUuities that arise in corporsjtio^s,- v;i:,;;: ■:;\ ;s\ _^'^^^ ., •« J kftow It is^e^n^^Jtf, that ^il *6i^ra- -''iiions are subject t6 noviSitatibns»bt<t merely to the ■^* common law of the land ; and this shall be presently -" explained. But first, as I have laid it down as a *' rule, that the founder, his heirs, or assigns, are the ** visitors of all lay corporations, let us inquire what is ^' meant by the/«?MW(?r,The founder of all corporations, " in the strictest and original sensei is the Kingaloh^, " for he only can incorporate a society ; and in civil *' incorporations such as a mayor aud commonalty, " etc., where there are no possession or endowments ^' given to the body, there is no other founder but the " King. The King being thus constituted by law " visitor of all civil corporations, the law has also " appointed the place wherein he shall exercise this •♦* jurisdiction : which is the court of King's Bench : •• where and where only, all misbehaviours of this " kind of corporations are inquired into and redressed, " and all their controversies decided.. And this is *' what I understand to be the meaning of our lawyers *' when they say that these civil corporations are '" liable to no visitation ; that is that the law having '*' by immemorial usage appointed them to be visited " and inspected by the King, their founder, in his *' majesty's court of King's bench, according to the '• rules of common law, they ought not to be visited *'^ elsewhere, or by any other authority." It is then most evident from these quotations that civil corporations are subject to be visited by the^r founder who is the King or his delegates, and that those visitations are made through the medium of tribunals, upon the information of the attorney-gene- ral of the King or in his name. ' The american law is similar to the English law in 'imS'Fesp^ciit^,^*. '^>{-* ■'•■J ;,pp ,.,j. ..'■ - .-j-j^.-j f ,,.- ..■ .-'' ' j " To render the charters 6rconstitutt6ns,prdrhan6^ " and byr]a.wso{ corppration of pierfect obligatioh and " generally to maiat^o their peace and good govei^n- " ment, the bodies are subject to visitation; bt,\n " other word^ to the inspejCttQn and control of Ibribti- " nals reoogaized by^ th^ !Uws of the land. CiVtl ccir- '** porations are visited by the Governipe^t itsellT, J through the iitiediuQi of the. courts pfjustic^' ' , " divil<;orppraUonsy whether^ * * created for public use and advantage, properlj^ fall 6 " under the superintendency of the sovereign power ** whose duty it is to take care of the public interest,. " whereas corporation whose object is the distributioi> " of a private benefaction, may well find jealous guar* " dians in the zeal or vanity of the founder, his heirs " or appointees." (Angell & Ames s. 684.) The principles which r^ulate this question are clearly given by the most eminent legal writers, ^nd contrary to the pretention ofSir Alex.Campbell,they make no distinction between corporations erected by letters patent, by royal charter or by act of psirlia- ment Tribunals have jurisdiction over all civil corpo- rations, without any regard for the authority by which they were instituted. The Hon. ifiinister of justice admits truly that the- Crown, through its courts, can, for good reasons,annql tii6 letters patent which it has granted, but he is in ddubt whether the Crown can, through the medium of these courts, annul a charter granted by att of Par- liament According to the quotations we have made» therei it no difference between a body incorporated by letters patent andone by act of Parliament.Letters patent are granted by a person authorized by act of Parliament by a delegation of its powers, according to the well known maxim : Qui facit pep alium facit per St, And in the case of a corporation created by parliament, the king, when giving his sanction, beco- mes thereby its founder and obtains the right of con^ ' trol given to him by comnoon law, and which he exercises through the medium of tribunals. However, as banks cannot be incorpovaved by let- < tersimtent l^ virtue of the ^neral act concerning \ joiiit stock companies, the minister of justice corned to the conclusion that it was not tl>e intuition of Far- liatnent to Relegate its powers for their mcdrpdratton, and thefiby estftbtished a distinction between thecase of aiotaiik ii^torporeitdd by sfjeciat act 6t Farlifttnenti and that of a cbn^pany in^(^porated hy viilrue of the provisions of the general act It is an unnatural con- clusion drawn from a -false principle, for ^ir CaMpbelB adds' Kmmedlately' after ; ** And even as to general '■ '" patents, tke powers therein contained, when they " are laid down in enabling acts of Parliaoient, only " come into life by the breath of the troivn^ and the- " refore I think differ eMentially from acts of parlla- " ment creating corporations." Where can Sir Campbell find that difference to whicl]i he alludes ? Are not acts of parliafnen^ ^lothed, by the royal sanction, with the breath af the Crpwn ) l^esides, if Sir Caoapbell was looking for a prec^r dent^ in spite of the principles given by authors, there vras one in this country and one that he knew. He has even made a mention of it in his judgment, when he says that the National Bank of Quebec, incorpor- ated by act of parliament, had been prosecuted for forfeiture of charter by virtue of the jiat of the At- torney General, and he adds that, in some of the United States, it has been decided that, with regard to this view of the case, there is no distinction to be made between charters granted under the great seal of the state, and those granted by legislature. Having argued at length on this matter, and en- deavoured to demonstrate the difference which exists between a corporation created by letters patent and that erected by act of parliament, it is strange to hear the minister of justice say that there is no need for him to give an opinion and that, the only reason why he has emitted those, doubts, was, to show how much their existence increases the responsibility of the Attorney General. It was hardly possible for him to have any doubt about the matter, in presence of the authorities which he had by him and oC the precedent of his predei;:es- isor in the ministry of justice, the hon. Ma James Mc- Donald. Besides, supposing that there \id& any ground for his doubt, was he justified in giving expression to it, when he had not the right to judge? It was a question which could be argued before the court of Exchequer, but which Sir Campbell had no r^ht to decide. , ■ ? -■ • ' -- .■.-vj,. . From all this, it is dear that, if the pretentions of the hon. minister were well grounded, there would be 8 no other control over civil corporations but that which- • ..parliament could exercise itself. It would then be necessary for, parliament to become A court of justice in order to inquire Into th^ h?ture of faetn and jiro-^ pounce vpoh thiem. Corporations would no longer ,^ sutgect to the visi!Utf6n^ of the KiHg, which are , ,X^c tjb^ough the n)edium <>f tribvinals ; they would pecomc priviledged bpdies, havii'ig the faciltty to in- . JfiQge more or tess an4 more thiin less their chatter ,rand it woiilcl be mi6st difficult to reach them^nd , '.Junish'tiiem.: '.Z};::'" :^^'"?:7'^ '''' ^;^'^*-'^'^'«"' • , .^^, ^Vc may Wejl say that the ic)b^Ht)e emitted by the .^ ^minister of justice seems to iis' contrary to the sound* ,.vmterpretatioh whic^h shoulcl b<f g^ven of the constitu> / ftipn by \yhich we are ruled, ah<) if there couM reially w (.exist a 4qu^ on the rhatter.parli^ment should examine [ -^Uie question and tmmediate1)r prepare a remedy fon ^iiinoyances and danger^ of such a doctrine. '-■k h;*. y:,i: In the second place, Sir Campbell reproaches the- . ^petitioner for. not haying urged in his petition that he had suffered by the infractions of which the Bank is. .accused. It is a very queer reproach, and without attaching more impor(ence than it is necessary to that ^4<.point» we. will say that; the petitioner proves in his- , .^petition that both, the public and himself have suffer- V. ; ytd by the acts of which the Bank is accused. True ^ „'.Jt is a.fact that the pI^intjflT.i^ ^shareholder in the »'; liCapitaLstock,. but it is not ias such' that he coniplains,. :• -'fflor is it,as.$uch tl^at he could and ha<i a fight to • ..,. ^ompmn. , He alleges that the Bank has b<len preju- iij<dicial to the public in generjtli by the yiolatiprt of its charter and that he, as a private indivi'dual, has sufif- ,, erd; by those yjol^tions. The Bank ha? chafged him ' ;,,n jusuripws interests ; f}%h3i^. entered in competitTon with ~ i hip) in the manufacturing and commerce of shb^s ; it ! v^W^ uicr^ed hjs re^ponsitiiHty as shareholder, in ' u^^impnopoli^ing the shares of |iis capital to the atnount of $43,6cx), etc. The plairitliT was thereffore perfectly right to complain as he has done. V 9 .If Let us pass to a more important point. in it ■ . In the matter before us, is the attorney general • bound to grant the request made t6 him, ^|ien, by the petition itself and i>y the aj^<^W/ which accompa- • nies it becomes evident that there are sufficient reasons • to, authorize a prosecution ^ Yes, b^use it is' a ques- tion ojl^ right The only qi^cretion >vl)kh tfi^ rtittiniter ^ can exercice is tb veriiy if the vlc^atioh of thfe law^ alleged in the petition is uodehial>|e, ^nd h; the f^cts . enumerated are sufficient in Ulw, J>rimafd(^e,t6 make that vioUtion evident The attorney g^eh^nit J^^s iiot ' the right to take tlie evid<?nce of witnes^s afid accor- ding to a well established procedure, It is ii^u^tomary^ in such cases for the Piaintiff to proceed >4^''^^ wi- thout ^ving any not(ce to the adverse party, (Foster, . on settle facias, p. 249.); It might be said that in suciv > a request, the minister of justice acts thfe part Of a .- grand jury in a criminal court ; tie exaniines Whether ' there is sufficient ground for a law suit. What says chapter 88 of the consolidated statutes : of Lower Canada, sec, 9 :...... and wberteveif" "any "corporation, public body Or fioard offends against. " any of the provisions of the act or acts Creating it... " or violates the provisions of any law in such a man- " ner as to forfeit it-"* charter by mis-user.. .....•.<..«•« . " it shall be the duty of Her Majesty" sattorH&^ gem- " ral (or lower Canada ^heH he has g6od reason to- • " believe that the same can be estdblisked by prttcf, ii$ " every case of public interest and also in every such \ *' case in which satisfactory security is given to indem- " nify the government against a,U cost and e>cpenses ; " to be incurred by such proceeding, to apply for and ; " OP behalf of Her Majesty to the Superior Court, In confonniiy wiin these 'pr<ivlsibrisdf tKi; ik-W, and • according to principles recordecjt by legal authors and sanctioned by practice, Hon. M. J. McDOnliid, the predecessor of Sir Alex Campbell in the liifinistry of . ju^tice^ allowed the prosecution of the National Bank -. I 10 ' '/ . of Quebec for forfeiture of its charter, upon the simple petition of the plaintiff. Did the present minister of justice endeavor to att in conformity with the prescriptions of the law and practice loilowed in such a matter ? Did he consider that it was his duty^ as the clause quoted above has it expressly; to grant the request ?, Far from it ; he went so far as to allow the accused" part" to present declarations niade by virtue of the law for the suppression of voluntary oaths and even the production of certificates not sworn to. By that irregular procedure, he placed plaintif in a very disadvantageous position. The latter could not cross question the witnesses called against him nor control their evidence. Besides, he had witnesses who ; refused to give their evidence through fear of the . Bknk, and the minister himself had not the power to force these witnesses to give their evidence. The; petitioner therefore could present only a part of his v case, and his own witnesses said only what they wan^ ted to say. The fact of allowing a proof and a counter proof < on a simple request to proscute, was simply trying the case itself and interfering with functions which belong to a court of justice and not to a minister of the Crown. , ...,, ,„„ s^. . .„.. ..,.,_, ^f»r;tt^n:j'h^JiM'^;. yy u>j-.<j, • oj jon D';/'-ifc.q J in J ,r.bi:ni> \> iii^fi 7i:inc>:tjx; •Ji5.t j^" ^/*'Jub ',• ^\ v;. There is another defect in the judgement which ivc criticizse and that is where the minister of justice acknowledges that he is obliged to apply the laws prior to the confederation but not those posterior to it Here are his words : ** I have myself examined the statute creating the " ofiice w,hich \ hold. It is Act. 31 Vic, Ch., 39, and " by Section Jr the attorney jg^eneral of Canada is " charged wit^ the powers and duties which, by the " laws of the s<^veral provinces, belonged to the of)ice '' of Attorney General in each province up to the time " when; the British North American Act, 1867, came '* into effect, and which laws, under the provisions of i.'Zl -r I -41 U 4( «< 41 4< 41 <( 41 ■4< (I ■4( 4( 4( '4( « 11 the said act.are to be administered and carried into effect by the Government of the Dominion. " The B. N. A. Act, 1867, Sec 91, certainly confers on the Dominion exclusive legislative authority with respect, inter alia, to banking, the incorpora- tion of banks and the issue of paper money, but I can find nothing in it which imposes on the Go- vernment of the Dominion the duty of adntirtisfe- rtng or carrying such laws into effect ; and on me the consequent duty of prosecuting a forfeiture of a bank charter. " It is the duty of the Government of the Doini- nion to administer and carry in effect such laws as those relating to customs and Inland Revenue and Militia and so forth ; but laws relating to banks, save as regards duties imposed by the Banking act on the executive, or to be inferred from the laW.are administered in the Province where the bank is i uAi: " domiciled." ?4 ^ i^l*' Jn^^vUj i.u/oj This is indeed something new, '■^^^■'•' '^'^' What then is that act 3 1 Vict Ch. 39, spoken of fey Sir Campbell ? It is a law adopted at the' begintiing of confederation and creating a department of the civil service called the " department of justice.** This act, in its provisions which haue any relation to the laws prior to confederation, was passed not to impose new duties on the attorney general of Canada, but really to assign to him the duties which, by virtue of the laws prior to confederation.belonged to thfc attbri'' ney general of each province, when rttattetife falling under the control of the federal government woUld con\e into question. The intention was to divide the duties imposed on the attorney general and this isthi6 meaning of the act Is there are duties to be ftilfilM by an attorney general by virtue of the old laws and" if those duties concern things which belong to the attributions of the federal government, they shall be fulfilled by the attorney general of Canada and not bv the attorney general of a province, i^^ « '«-^ pfnofj For example, take article 997 of the cbde i/i divil procedure of Lower Canada which imposes some /'.I Ji.f . 12 duties on the attorney general of Lower Canada. After the passing of the act 31 Vict Ch. 39^ those duties, must ht fulfilled by the attorney general of Quebec with regard to Corpbrations created for local 9bj«cts, jind by the attorhiey general of Ca^nada with regard to corporations for general purposes of the l^pminidh, such as Banks. Moreover, the act. 31 Vv6t] ch. 39, sajrs expressly tl^at "the minister of jdstfct shall eaterchle the rights * arid fulfil the dutiesr iittached to the office of attbr- ** niy geh^ralbf England by the laivs or usage ;" now accbrding to the authors whom we have Quoted, we know what is the duty of the attorney general of En- gland, when the king wishes to exercise the right of visttatibh vt^htch ht possesses over incorporated bodies. ' Besides the principle of law as well as good sense indicate that th^ government of the Dominion has sufficient authority to see that the laws adopted by the federal ParKariient^« earned into execution. The minister of justice cannot forget that there is a Well known prindp^? of constitutional law which goes to say that the king (that is to say the Executive) is charged with the execution of the laws. By refering to the legitl authors, with whom he is well acquainted, Sir Campbell would have been re- minded that laws are administered by the power which makes them. Sir Campbell would haVc remembered also that the government which creates a corporation can alone prosecute to obtain the forfeiture of the charter granted;".;;';'"'" '";;'-' '■; "••-^ -•'' f '/'iMM;, -. Sir Caiili)bei*l Ai^^uid farffierriidre H&Vfe' fememhered thiat th^ crown being, for the country's welfare, inte- rested in the m^lintenarice of its own laws, it belonged to it to issue the scire facias. ^^^ ^ ' ■-'^'^ mra'ix'i „ Fpf the same reason, Sir Campbell cdirld have sa- tisfied himself that the person whose duty it was to t^ke such proceedings, was the attorney general of t!he Dominion, since the charter of the accused party was a charter of the Dominion. The minister of jus- tice had nothing to do but to consult such authors as 13 r "'Foster, Angel and Ames, Brice» Fisher Albjbott's digest^ etc. In » word w: mu^t own that we cannot > ui^eiistand hon. Sir Campbell could say ,: . 'VNp duty : '" imperatively devolves upon me under the language " of the statute creating my office in respect pf such a " proceeding as the pre^enti" ;when the la>^ makes it -'an imperative duty ifor<hnn accori^ipgtQ ch> .^S^pf the :' consoHdated statutes of Lower Cwfizi^^ >yhen also a law ]prior to confederatiopvremjnds hiiyi jpiC that (^uty, ' which is made so evident )>y the fatpous a<^t 31 Vict. ch. to, that the ignorance of it is. npt, excusable. tf.riw ■'Of; X ininister of justice has examined the several allegations of the petition and reviewed certain facts with which the Bank is reproached.' This in^ntion was not only to see whether the arguments enumera- ted proved by themselves that the law. . had , been violated, but also to enter upon the very merits of the case and thus encroach upon the province of the tri- bunal whose right and duty it was to judge the facts. We shall follow him on that ground and it will be ^n easy matter for any one to convince himself that the accusations were sufficiently founded to authorize the attorney general to allow a prosecution for for- feiture of charter. The Bank was accusec* of having,, from the ^ 2nd of January l874tothe 19th of march 1 88 r, habitually and ° constantly violated and tran.>^gressed the fundamen- tal articles of the laws by which banks are governed^ and especially its charter, of having made a bad use of its powers' as a corporation, of having arrogated to ' itself functions which it was expressly forbidden to exercize, and of having assumed franchises and privi- leges which the law does not confer upoo it. . It had been guilty of these JHegalities . in the following ■ mannen ,>« ,, . •.,;:,,- , j.. 'f hj. By exacting constantly usurious rates of fnterest, exceeding seven per cent ; that is to say a rate of interest or discount of eight and nine per c^ht and sometimes more. u 2. By lending money and making loans either < directly or indirectly on security, and real estate mortgages. 3. By lending money and making loans on the security and pledge of the capital of the bank. 4. By lending money and making loans on the security and pawn of goods, wares and merchandise, in a manner different from that required by law. .a}^*- 5. By buying goods, wares and merchandize. / 6. By the selling an^l cartcrJu^g of goo<^S| wares unci ttiCtCii3LTiOilZCi,cti7>r:jti^ti/f \f\ttfri}i<».^').-jtr\ ix^ .;;p*jru»/r«-? 7. By being engaged in operations different from those which commonly belong to a banking business. 8. By acquiring arid holding real estate for purpo- ses foreing to the administration of its lawful business^ and by selling it in cases prohibited by law.,., * «n^.f - 9. By the buying and cartering either directly or indirectly of the snares of its capital stock, as it is mentioned in the petition. Particular cases were given ,10, support of each of the alcove accusations. .. ^^.i^^^^^,^^ .",,..;+ .....n ^^.^ ^,?..v, ^ In answer to the first accusa^iion, the ^ank admits having charged usurious rates of interest exceeding seven per cent but alleged having done it thinking that it had the right to do it. Is the ract admitted ? Yes, „ -^ " ^ ^ n : -/ - - * ? » ' • Whose duty was it to judge the excuse of the Bank? It was the duty of the courts of justice. Starting from this, the decision of the question should have been carried before the tribunals and the minister of justice. had no right to decide it, which, nevertheless, he took upon himself to do, Sir Campbell has acted as would have done a justice of the peace at a preli- minary hearing by pronouncing the accused guilty or not guilty instead of examining solely whether there be cause for his trial before the court of Queen's i5encn. .xoi-jifyj^jy /-^ti^ A^rA-^d r^f>70''-''j ■">'«v:"'^ •'>?..'??'s»fifK:'tF' Moreover, when he says in his judgement that a bank cannot incur any penalty by receiving a rate of interest above seven per cent and that the forfeiture of its charter would be the greatest penalty it could 15 <r> be subject to, he has given a false interpretation of the law. He makes the law say what was never in its intention to say. The legislator, by the clause 52 had in view to blot out the penalties enacted against usury by former laws, and not to declare that a bank by charging more than seven per cent interest, would not be subject, by virtue of common. laHv, to lose its rights of corporation; -^^^ ^««'^ inij^iub =;>an5..i: We may add that this question is important under every respect and that those who do any banking business are exceedingly interested in knowing the opinion of courts of justice on this matter. The Bank denied the second accusation, but it was proven tha,t it had opened an accouct of $ 1 8,ocx3 in favor of a certain mzinu&ctunng company and that it had exacted a mbrtgiage on real estates for the same amount and that it had made advances to the same company before the mortgage as well as after. The obligation, signed before notary executed for advances made and to be made. The accountant of the bank at that time states that advances were made by the bank after the date of the mortgage. The manager of the company sta,tes also that the bank did advance money after the^ date of the objliga- tion, on the security of the mortgage. ^ The bank, in an opposition made by itself Ij^lpire a court of justice, states that up to the date of the obligation, the company was indebted to it ipfthe sum of $8,400 only; out of that sum $2,156 were notes to which the company was not k party, ^^* ■'. '? -^" If the indebtedness to the barik was only $$,4d6,- what is the reason of that mortgage 6f $18,400 taken as security for advances made and to^ be made^ as ike act says I ^'>^y^yjf^-^^ ^iioiiuoixoic^^ii ^^nniiau >{"i*nii; Does it n6t lekd to the presumptlpil that those advances were made on the security of that mo^tg^ge? It has also been proven before the niinister (^jus- tice, that the banket i^lnother date and through inter- mediate petsdni, had<4^acted a mortgage for the suni> of $26,000 fi^m the shareholders of another com- pany, arid then, on that security^ had made advaiw 16 ces of money. The answer of the accused party was tthat the socalled intermediate persons had acted for themselves and not for the bank. Several declarations were produced by the Plaintiff to prove the falsehood of this answer. In any case, the declarations and the authentical acts establish facts which Sir A. Campbell could not judge, biit which were sufficient to authorize the hea- ding of the case before a court of justice, ^ nvutav On die 3 accusation, it has been made evident that on a certain date,thc shares of the bank owned by H. L. were under seizure. The bank consented to advan- ce him $364.77 on the endorsement of £. B. provided he gave his shares as security. Then on the same day, H, L. gave his note endorsed by E. B. and transferred Jits shares to him as security. Immediately, on the sameday, £. B. transferred the shares to the cashier in trusts and H. L. got his money. Does it not appear from those facts that a loan was imade by the bank on the security and pledge of sha- res of its capital stock ? In answer to the 46 accusation, the cashier of the ^ank says that in October and November 1879, the bank advanced to a certain person $80 to pay the «men he had employed sawing lumber. This loan was made on condition that the individual would pay back the amount and apply a certain portion of that -wood to pay the interest which he was owing the bank on a debt of $400a That person refunded the $80 to the bank, $28 more in money and $284 in building lumber. Three witneses prove that the lum- ber was carried to the bank and retailed by it It becomes therefore evident that the lumber had been accepted by the bank as security of the advance of the |i^iEls well as security for the interests of the ■^^ood,i--'"' '■''■•■"'■.' ''':'■ ■■■"'■■■ '' '■'■-■-'' ---;..<■:.-■■:. As for tk^ othlEH* accusations, ' it tvas proven that s^lthdugh fb^idden to do ^6 by section 40 of the law on banks, the bank has acquired goods, wares and merchandize, to wit : the stock of A. & L, store con- sisting of groceries, hardware & merchandize of all sorts ; 1+ fr' : >Is r Building lu'Biber ; q -itt Ui )inT»i!ii K-»n*.,r.«. «^4 , A bankrupt stock consisting of carriages, toots of x:arriage maker : Another bankrupt stock consisting of leather.shoes, tools, machines, office furniture and material for the manufacture of shoes. tir> H-^Mw ^i-;^i nW?<fi - ^ Besides the proof states that the Bank although forbidden by the law to do so, has sold those goodX For the same reason, the Bank has violated the law and gone beyond the limits of its charter by buying the bankrupt stock of a shoe company and, for nearly two years, running the manufacture for its own benefit by retailing shoes. The evidence in the breef states that the Bank had bought new mate- rial, which it sold wholesale and retail and that it sent commercial travelers through the country , to facilitate the sale of its products. bfii; ,v<.«^a ;<; The accused party has also undertaken operations foreign to a banking business and has made the ac- quisition of credits and debts not verified by promis- sory notes or negotiable goods, such as the acount books of three bankrupt commercial societies. Well, the Bank not satisfied with having bought the account books of those bankrupt companies just mentioned, has also sought to obtain some r ortgages against one of the bankrupt partners, and lias thus acquiered the mortgages owed by him to two of his creditors and to a building society. The Bank had no mortgages on those properties and it was not in any of the cases mentioned by tjKe law, therefore its made of ,s^cting was a yiolation of its ■'Charter.; i^fjm".;: ?i(:-Us,'(? 3^9^'•p?>^t;^v«'vdt ;;'.r'vv,-Ar II was also a yiolation of the law^ when in tnose very cases» it assum^ the payment of a comproniise and the unlimited obligations of two bankriip^ies. Moreover the bank has acquired rights kQOwn as litigious by buyiog the claim , of R. Si M, against a railway; company and the. right to the debentures which yfcn to be issued by certain nmni- cipal c<Hrporations. in favor of that company* subject to certain conditions to be fulfilled by that company^ 18 When that acquisition was being made, those munf- cipalities were unwilling to issue their debentures, giving as a reason that the conditions of the regula- tions had not been fulfilled, Always contrary to law, the Bank has acquired shares in its own capital stock, ^"^r'v f »^^^ ^''V ■ ; > v; We would remark here that there is only 40 per 100 paid on the shares of that Bank. Has the accusation been made good ? Yes, by the list of shares transferred to the Bank, and by the report made at that time to the government by the cashier, stating that he was the bearer intrust for the Bank of $43,600 worth of shares. Naturally, the depositors rely on this, that they can fall back on the shareholders for the recovery of the balance of shares and for the doudle responsibili- ty in the case of the Bank becoming insolvent When a Bank lessens that security, it destroys its credit the same ratio and increases the responsability of its shareholders. Here then is a dangerous trafic, forbidden by law, and which was proven before the minister of justice. We shall mention a last accusation, and it is this : that this Bank had become security for a compromise and thereby took upon itself the responsibility of nearly $90,000, for a consideration of $14,248.61. « The accused party admitted, with few exceptions, all the facts brought against it, but it gave, as an ex- planation, that those acts had taken place betv/een itself and its debtors and that it had thus acted to protect itself. Can such a reason alter the nature of the affairs of a Bank, and annul a law whose pro- visions are so peremptory ? If such were the case in the usual course of things, any man who breaks the law would have an excuse to prevent its execution and order in society would come to an end. In any case, looking at the proof in the brief, was there ground for a law suit ? Yes, certainly, for it appeared that the law had been violated. But the Bank in question invoked an excuse, or gave an ex- planation which was an admission of the fact brought 'I 19 against it Then who was to decide whether that Bank had acted in good faith when it charged usu- rious rates of interest, and whether jt had, the right to act with its debtors in a manner forbidden by law? The court of Exchequer and not t^p minister of justice. There was then ground for a suit against ^he accu* sed party, and when Sir Alex. Campbell refused to grant his yf<7/ to allow t|ie prosecution, he acted m a manner detrimental to serious interests, and l^ads the public to believe that henceforth, corpprations,w|U be at perfect liberty , and, may according to their fancy, violate their charter, without any dfeadof the visita- tion of courts of justice. It is a mistake. The granting of a prosecution could not be very prejudicial to the accused party ; nothing else besides the forfeiture of its charter by the courts of justice was of a nature to hurt the bank seriously, but a pu- blic body must not be more protected from the reach of justice than private individualsAVhen these violate the law, they are punished. When a corporation evidently goes beyond its powers and infringes the privileges granted to it by the legislator, why should it be protected by those who, by their position and duty, should be the safe-guards of public interests ? Can a minister of justice refuse in conscience to pro- tect the weak against the strong ? Is it even sound policy to act in that manner ? If such be the case, the law concerning banks must be looked upon as a dead letter. True, it forbids those financial institutions to charge usurious interests exceeding seven per cent, to lend money directly or indirectly and make advances on mortgage securities ; true, it forbids them to buy and sell goods, wares and merchandize, to trade in lumber, to control manufac- tures and to run them for their own benefit, to assume the payment of unlimitted obligations, to acquire dis- puted rights, to negotiate the shares of their capital stock ; yet, if a bank does all that is forbidden by law, it must not be put to trouble nor stopped by a prosecution from committing fresh illegalities or errors, because, according to the opinion of an easy minister, such a prosecution might be prejudicial to it ?! V .-' 2U We do not beleive that parliament will be diposed to sanction a doctrine so perverse, so fraught with dangers and so much at variance with the sound no- tions of right and justice. The emission of such a proposition is f-^fficient for any well thinking man to cast it a side, and there will be but one voice to dis- approve the extraordinary ground taken by Sir Alex. Campbell, and repudiate this way of interpreting the laws which r^[ulate this matter. . A country is not well governed unless there is liberty of action for all, and unless all have free access to the courts of justice to obtain the reform of those abuses, which in their opinion, are for them a source of annoyance or suflfertng. 4 . "J: r^^