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PROVINCE OF MANITOBA 
 
 g 
 
 ^^;s^-^^ 
 
 "THE 
 NATURAL RESOURCES 
 QUESTION" 
 
 THE HISTORICAL BASIS 
 
 OF 
 
 PROVINCIAL CLAIMS 
 
 By CHESTER MARTIN 
 
'THE NATURAL RESOURCES 
 QUESTION" 
 
"THE NATURAL RESOURCES 
 QUESTION" 
 
 THE HISTORICAL BASIS 
 
 OF 
 
 PROVINCIAL CLAIMS 
 
 By 
 
 CHESTER MARTIN 
 
 PROFESSOR OF HISTORY, UNIVERSITY OP MANITOBA 
 
 WINNIPEG. MANITOBA: 
 
 PfUNTBD BY Philip Purcell, King's Printer for the 
 
 Province of Manitoba. 
 
 1920 
 
Winnipeg, 
 
 April 2S, 1920. 
 
 The Hon. T. H. Johnson, 
 
 Attorney-General of Manitoba. 
 
 Dear Sir — 
 
 I beg to submit herewith the outline of the Histori- 
 cal Basis of Provincial Claims to the Natural Resources 
 of Manitoba, prepared under your instructions of 
 January, 1919. 
 
 It is almost unnecessary, perhaps, to add in case 
 of publication that the views here expressed as the result 
 of historical investigation are my own and must be 
 regarded in no way as attaching to the official views of 
 responsible ministers under the Crown. Permit me, 
 however, to express my thanks for your unfailing 
 courtesy and for the very great kindness of the Provin- 
 cial Librarian and stajff in facilitating my work in 
 every way. 
 
 Believe me. 
 
 Respectfully yours, 
 
 CHESTER MARTIN. 
 
CONTENTS 
 
 Page 
 
 I. Introduction: The Nature and Scope 
 
 of the Inquiry 9 
 
 II. British Principles with Regard to the 
 
 Public Domain... 17 
 
 III. The Surrender of Chartered Rights in 
 
 Rupert's Land and the "Transfer" 
 
 to Canada, 1870 27 
 
 IV. The "Transfer" and Provincial Status for 
 
 Manitoba 43 
 
 V. British Principles and Canadian Practice 
 
 in British Columbia 53 
 
 VI. British Principles and Canadian Practice 
 
 in Prince Edward Island 63 
 
 VII. Federal Policy and Provincial Poverty in 
 
 Manitoba after 1870 74 
 
 VIII. American Precedents for a British Prov- 
 ince 88 
 
 IX. British Principles in the Ascendant ; Prov- 
 ince or Colony? 107 
 
 Appendix : General Summary..... 129 
 
I. 
 
 INTRODUCTION: 
 THE NATURE AND SCOPE OF THE INQUIRY, 
 
 A very representative convention of English-speaking and 
 French inhabitants of Assiniboia assembled at Fort Garry 
 (February, 1870) to meet Commissioner Smith, afterwards 
 Lord Strathcona, in order to discuss the terms of union with 
 Canada. With Judge Black presiding, a 'list of rights' was 
 submitted claiming for the 'Local Legislature . . full 
 
 control of all the public land.' On at least three other oc- 
 casions during the process of transfer of Rupert's Land to 
 Canada, less representative sections of the population 
 advanced the same claim. The provincial control of the 
 public domain has been advocated almost continuously for 
 fifty years. 
 
 The constitutional principles underlying this claim, 
 however, are much older than the Province of Manitoba or 
 the Dominion of Canada, and the historical basis of pro- 
 vincial "rights' in respect of the public domain has formed a 
 very distinctive chapter in the constitutional history of the 
 British provinces and Dominions. The public domain has 
 always been, and still remains, in title 'vested in the Crown'®; 
 but two functions with regard to it, viz. (a) the administra- 
 tion of the same, and (b) the beneficial interest therein, long 
 continued the subject of one of the most interesting con- 
 stitutional conflicts in our history, until both were un- 
 reservedly conceded to self-governing colonies upon their 
 undertaking the duties of 'responsible government.' The 
 claim of the Province of Manitoba in contending for the 
 reversion of her natural resources is based upon this double 
 
 ®33 Vic, c. 3, s. 30; 4 & 5 Edw. vii, c. 3, s. 21; 4 & 5 Edw. vii, c. 42, 
 s. 21, etc. Keith, Responsible Government in the Dominions, i, 146. Cf. 
 Viscount Haldane in Theodore v. Duncan, Privy Council, May 2, 1919: 
 'The Crown is one and indivisible throughout the Empire.' Law Journal 
 Reports, Oct., 1919, p. 125. 
 
10 Introduction 
 
 principle as applied to the period of her status as a Canadian 
 province since 1870, and it may be stated briefly as a claim 
 (o) to the unrestricted control of the natural resources within 
 her boundaries hitherto unalienated, (6) to the ample recogni- 
 tion of her full beneficial interest as a Canadian province 
 not only in these but in those already alienated by 'the 
 Government of Canada for the purposes of the Dominion' 
 since Manitoba acquired self-governing provincial status in 
 the Canadian Confederation. 
 
 In a very real sense, therefore, the issue is now as funda- 
 mental for this province as was the control of the 'clergy 
 reserves' or of the crown lands during the long controversy 
 for 'responsible government' in Upper Canada. In fact, it is 
 largely the same issue: whether Manitoba is a 'colony' or a 
 province of the Dominion. In this the province is claiming 
 no new principles. The issues which it raises are as old as 
 'responsible government.' It will be seen that by virtue of 
 the principles then vindicated, all the original provinces of 
 the Dominion acquired the full beneficial control of their 
 public domain long before Confederation. These principles 
 were recognized and perpetuated at Confederation by section 
 109 of the British North America Act of 1867, by which the 
 beneficial control of the public domain was vested in the 
 several provinces. The same principles, elsewhere applied, 
 resulted in the beneficial control of public land by New 
 Zealand, by Newfoundland and by the provinces of the 
 Australian Commonwealth. In fact, so fundamental and so 
 widely recognized are these principles — ^largely through the 
 Canadian precedent after 'responsible government' — that in 
 all the self-governing provinces and Dominions of the British 
 ' Empire the Prairie Provinces of Canada constitute the only 
 exception to their operation. Even in the case of other 
 provinces subsequently entering the Canadian Confederation, 
 Manitoba remained for thirty-five years the solitary exception 
 to the rule. In the case of British Columbia, the principles 
 were applied so naturally and so normally that the issue was 
 not even raised for discussion; while in the case of Prince 
 Edward Island, the Dominion assumed obligations for which 
 
Introduction 11 
 
 it was in no wise responsible in order to endow the province 
 with an equivalent for its public domain alienated by royal 
 grants of the preceding century. For half a century now 
 the Province of Manitoba has been contending for con- 
 stitutional 'rights' the denial of which was so exceptional 
 as to be an anachronism even in 1870. 
 
 The present inquiry, therefore, may be simplified by out- 
 lining very briefly at the outset the range of the historical 
 evidence to be examined in the sections to follow: 
 
 (II.) As already indicated, the constitutional principles 
 now invoked by Manitoba were established in the conflict 
 for 'responsible government', and the historical background 
 of that conflict is to be found not in Manitoba but in the 
 Province of Canada three generations ago. It was in 
 'Canada', in fact, that those principles were first vindicated 
 which have since become the common heritage of all British 
 self-governing communities. With regard to the public 
 domain at least, it is in the case nearest home, that of the 
 Prairie Provinces of Canada, that these principles have yet to 
 be applied. As early as 1840 and 1847, as Keith points out, 
 'the Canadian Parliament received complete control of the 
 lands which were situated in those provinces, and the plan 
 adopted in every case of the grant of responsible government 
 to the Maritime Provinces took the form of a grant of full 
 rights over the lands in exchange for a civil list . . . 
 Canada has not adopted the British ideas in dealing with the 
 land in the new provinces.'® In the section (Chapter II) 
 entitled British Principles with Regard to the Public Domain, 
 an outline of these 'full rights over the lands' will be at- 
 tempted in as brief a space as may be felt to be consistent 
 with the fundamental importance of the principles involved. 
 
 (III.) The coriditions under which the Hudson's Bay 
 chartered rights in Rupert's Land were surrendered to the 
 Crown by the Hudson's Bay Company, and 'Rupert's Land' 
 (together with the 'North-Western Territory') united to 
 
 ®Keith, Responsible Government in the Dominions, vol. ii, pp. 1047, 1051 
 
12 Introduction 
 
 Canada by the Crown in 1870, were of a very exceptional 
 nature. The constitutional procedure scrupulously observed 
 in the process of transfer, however, left unimpaired the 
 implications of that procedure for the new district 'as a 
 part of the British Colonial System.'® There were exception- 
 al conditions — among others the payment of £300,000 — 
 attached to the preliminary surrender of chartered rights in 
 Rupert's Land to the Crown, and it is safe to say that from 
 these conditions many implications have been sought which 
 are quite unwarranted by the facts. Similarly, the element 
 of so-called 'purchase' has served to conceal in the British 
 constitutional procedure other implications which beyond 
 reasonable doubt are warranted by the facts. In discussing 
 (Chapter III) The Surrender of Chartered Rights in Rupert's 
 Land and the 'Transfer' to Canada in 1870, therefore, it will 
 be necessary to examine this element of 'purchase' and 
 the procedure observed in the surrender from the Hudson's 
 Bay Company to the Crown and the transfer from the 
 Crown to Canada. 
 
 (IV.) The circumstances under which Manitoba came 
 into Confederation as a province were also very remarkable 
 in that there was no previous period of territorial status. 
 The same Imperial Order in Council which effected the 
 transfer (in pursuance of the B.N. A. Act of 1867, section 146 
 and the Rupert's Land Act, 1868, section 3) effected also 
 provincial status for Manitoba by bringing into operation 
 the Manitoba Act of 1870. The conditions under which this 
 Act was drawn up, however, were so exceptional that British 
 principles were completely abrogated in connection with the 
 public domain. The terms imposed upon the province by 
 the Dominion provided for the administration of 'all un- 
 granted or waste laiids in the Province ... by the 
 Government of Canada for the purposes of the Dominion.' 
 The circumstances which were held to warrant this contraven- 
 
 OColonial Office to Governor-General, Nov. 30, 1869, quoted from 
 Order in Council of the Province of Canada, June 22, 1866. Correspondence 
 connected with Recent Occurrences in the North-West Territories, Ottawa, 
 1870, p. 139. 
 
Introduction 13 
 
 tion of British practice will be discussed in the chapter upon 
 The 'Transfer' and Provincial Status for Manitoba. 
 
 (V.) Within three years after the transfer of Rupert's 
 Land from the Crown and the creation of the Province of 
 Manitoba, two other provinces entered the Canadian^ 
 Confederation. British Columbia in 1871 had passed through 
 a development since 1849 which afforded in some respects 
 perhaps the closest parallel to that of Rupert's Land. In 
 both cases the surrender from the Hudson's Bay Company to 
 the Crown had been accompanied by a monetary considera- 
 tion, but whereas British Columbia came into Confederation 
 with- full beneficial control over her public domain, that over 
 Manitoba was retained by Canada 'for the purposes of the 
 Dominion.' The procedure followed in 1871 will be traced 
 (Chapter V) in the outline of British Principles and Canadian 
 Practice in British Columbia. 
 
 (VI.) The entrance of Prince Edward Island into Con- 
 federation in 1873 invites a similar discussion (Chapter VI) 
 of British Principles and Canadian Practice in Prince Edward 
 Island. In some respects the case of that province will be 
 found to afford even a closer parallel — and also a sharper 
 contrast — with Manitoba than that of British Columbia. 
 The circumstances were exceptional, and the exceptional 
 measures which were thus found to be necessary illustrate 
 very clearly the principles involved. The belated subsidy 'in 
 lieu of lands' to Manitoba in 1882 was granted 'as is done in 
 Prince Edward Island.' 
 
 (VII.) The policy pursued by the Federal Government 
 with regard to the public domain in Manitoba after 1870 
 affords a humiliating contrast to the British practices which 
 obtained elsewhere in Canada and the Empire. This will 
 be found to apply particularly to the Dominion's attitude of 
 'ownership' towards Manitoba as the 'property' of Canada^ 
 'purchased,' 'possessed,' and 'administered . . . for the 
 purposes of the Dominion.' This attitude is reflected even 
 in the statutory basis for the federal administration of the 
 public domain as devised in the Manitoba Act (afterwards 
 
14 Introduction 
 
 found to have been largely ultra vires) and confirmed by the 
 B.N. A. Act of 1871 'for all purposes whatsoever.' The 
 immigration and railway policy of the Dominion burdened 
 the province with intolerable obligations for 'local works' 
 and deprived the provincial treasury at the same time of all 
 'territorial revenues' from which such expenditures have 
 customarily been met. These conditions, culminating in the 
 humiliating 'finality clause' with regard to the increased 
 'subsidy in lieu of lands' in 1885, will be outlined in discussing 
 (Chapter VII) Federal Policy and Provincial Poverty in 
 Manitoba after 1870. 
 
 (VIII.) The implications of the 'subsidy in lieu of lands' 
 in 1882, together with the uncompromising attitude of the 
 Dominion nevertheless with regard to the whole issue of 
 'provincial rights' over the public domain, will require special 
 consideration in view of the avowal, by the Dominion Govern- 
 ment, of American in preference to British principles and 
 procedure. It will be found that American precedents were 
 not only persistently avowed but were perverted in the process 
 for thirty years in the attempt to justify the appropriation 
 of public lands in Manitoba 'for the purposes of the Dominion.' 
 A discussion of this phase of federal policy will be found in 
 the section (Chapter VIII) upon American Precedents for a 
 British Province. 
 
 (IX.) The return to sound British constitutional prin- 
 ciples and an outline of the general application of these to 
 the 'Natural Resources Question' as it now stands will be 
 attempted in the closing section entitled British Principles 
 in the Ascendant: Province or Colony? 
 
 This introductory outline is summarized below, and at 
 the close of each section will be found a brief summary of the 
 conclusions which seem warranted by the evidence. A 
 recapitulation of these conclusions under the various captions 
 outlined above is appended to this memorandum. 
 
Introduction 15 
 
 SUMMARY 
 
 1. A very representative convention at Fort Garry 
 (February, 1870) claimed among the terms of proposed union 
 with Canada 'full control of all the public land' for the 
 'Local Legislature.' Similar claims were advanced on at 
 least three other occasions by less representative sections of 
 the community during the process of transfer of Rupert's 
 Land_ to Canada. The provincial control of the public 
 domain has been advocated almost continuously for fifty 
 years. 
 
 2. The principles underlying this claim, however, are 
 much older than the Province of Manitoba or the Dominion 
 of Canada. The public domain has always been, and still 
 remains, in title 'vested in the Crown' which is 'one and 
 indivisible throughout the Empire' {Lord Haldane in P.C.)\ 
 but two functions with regard to it, viz. (a) the administra- 
 tion of the same, and (6) the beneficial interest therein, were 
 long in dispute until both were unreservedly conceded to 
 self-governing provinces upon their undertaking the duties 
 and obligations of 'responsible government.' 
 
 3. The claims of Manitoba are in exact conformity with 
 this double principle as applied to the period of her status as 
 a Canadian province since 1870, viz. (a) the unrestricted 
 control of natural resources hitherto unalienated, and {b) 
 ample recognition of full beneficial interest not only in these 
 but in those already alienated by 'the Government of Canada 
 for the purposes of the Dominion.' 
 
 4. The issue, therefore, is as fundamental as was the 
 control of crown lands, the 'clergy reserves,' etc., in Upper 
 Canada over eighty years ago. In fact it is largely the same 
 issue: whether Manitoba is a 'colony' or a province of the 
 Dominion. 
 
 5. The principles then established have been applied 
 everywhere to self-governing provinces under 'responsible 
 government'; to the Maritime Provinces and to 'Canada' long 
 before Confederation; to Newfoundland and New Zealand 
 and the provinces of the Australian Commonwealth; to all 
 the original provinces of the Canadian Confederation as 
 safeguarded by the B.N. A. Act, 1867, section 109; to British 
 Columbia and Prince Edward Island which have since entered 
 Confederation; to all the self-governing provinces and 
 Dominions of the Empire, in fact, but the Prairie Provinces 
 of Canada. 
 
16- Introduction 
 
 6. The present inquiry, therefore, may be simplified by 
 outlining at the outset the range of historical evidence to be 
 examined in the following sections: 
 
 (II.) British Principles with Regard to the Public 
 Domain, as established in Canada at 'respon- 
 sible government.' 
 
 (III.) The conditions determining The Surrender oj 
 Chartered Rights in Rupert's Land and the 
 'Transfer' to Canada in 1870. 
 
 (IV.) The circumstances of The 'Transfer' and Pro- 
 vincial Status for Manitoba in 1870. 
 
 (V.) An examination of British Principles and 
 Canadian Practice in British Columbia in 1871. 
 
 (VI.) A similar examination of British Principles and 
 Canadian Practice in Prince Edward Island in 
 1873. 
 (VII.) An outline — in humiliating contrast with British 
 practices elsewhere — of Federal Policy and 
 Provincial Poverty in Manitoba after 1870. 
 
 (VIII.) A discussion of the 'subsidy in lieu of lands' in 
 1882 and the federal avowal of American 
 Precedents for a British Province. 
 
 (IX.) ■ An outline of the return to sound British con- 
 stitutional principles and their application to 
 the present 'Natural Resources Question': 
 British Principles in the Ascendant: Province or 
 Colony ? 
 
II. 
 
 BRITISH PRINCIPLES WITH REGARD TO THE 
 PUBLIC DOMAIN. 
 
 It will not be necessary to review in great detail one of 
 the most signal contributions which the older provinces of 
 Canada were themselves the first to make towards the system 
 of responsible self-government in the provinces and Dominions 
 of the British Commonwealth. The open letters of a Nova 
 Scotian to a Colonial Secretary had a profound effect upon 
 that development. In Upper Canada, the 'clergy reserves' 
 and granting of crown lands formed in many instances the 
 immediate grievances which raised the larger issue and made 
 the outcome almost inevitable. The general results of that 
 conflict are traceable in the institutions of all the self- 
 governing dominions of the Empire. The present inquiry 
 may be restricted to those phases of the conflict which relate 
 to the public domain. 
 
 'In the North American Colonies, as in the United States,' 
 -wrote Lord Durham in his famous Report of 1839, 'the 
 function of authority most full of good or evil consequences 
 has been the disposal of the public land.'© The various 
 distinctive periods of constitutional development have left 
 their mark upon this 'function of authority' at almost every 
 stage. As already pointed out, the public domain has always 
 been, and still remains, 'vested in the Crown,' but the 
 administration of the public domain and the beneficial 
 interest therein may be said to form an integral part of the 
 long conflict which resulted in responsible government. The 
 case of a single district — now the Province of Ontario — may 
 be taken as typical of a practice which was very general in 
 its application and uniform in its results. 
 
 During the period from the cession of Canada to Great 1763- 
 Britain in 1763 to the calling of the first elective assembly 
 pursuant to the Constitutional Act of 1791, the administration 
 
 ® Durham's Report, ed. Lucas, ii, 206. 
 
18 British Principles 
 
 of the crown lands was vested in the Governor and Council, 
 and formed regularly the subject of official instructions both 
 in the commissions of the successive governors and in detailed 
 instructions drawn up for specific purposes from time to time. 
 During this period, and indeed long afterwards, the 'ungranted 
 and waste lands' were regarded as being vested in the Crown, 
 as being granted by the Crown through duly accredited 
 representatives (with 'full Power and Authority' to grant the 
 same 'upon such terms . . . and under such other 
 Conditions as shall appear to us to be necessary and ex- 
 pedient'®), and as forming insofar as these grants were 
 revenue-producing, the source, in part, of the 'casual and 
 territorial revenues' of the Crown. 
 1791- Throughout the succeeding period, from^ the Constitutional 
 
 Act of 1791 to the Act of Union, 1840, similar forms of 
 administration and control of crown lands remained theoreti- 
 cally in force, though these became the object of bitter and 
 almost incessant attack during the conflict for responsible 
 government. The Constitutional Act itself specifically safe- 
 guarded 'the King's prerogative touching the granting of 
 waste lands of the Crown within the said Provinces.'® In 
 the thirty-sixth and following sections of the same Act were 
 made the well-known provisions for 'clergy reserves' which 
 forced the whole question of responsible government in one 
 of its most acute and convincing forms.® 
 
 The powers nominally vested in the Governor 'acting with 
 the advice of his Executive Council, devolved in effect, 
 however, entirely upon his Council which was composed of 
 residents of the province entirely without responsibility to the 
 Assembly. 'Having interests of their own to promote, or 
 
 ©Royal Proclamation, October 7, 1763. Cf. Commission of Governor 
 Murray, November 21, 1763; Instructions to Governor Murray, December 7, 
 1763, etc.; Qtiebec Act, 1774 (14 Geo. iii, c. 83, s. 12); Instructions to Lord 
 Dorchester, August 23, 1786, etc. 
 
 ®31 Geo. iii, c. 31, s. 42. 
 
 ®'It shall and may be lawful for His Majesty ... to authorize 
 the Governor ... to make from and out of the lands of the Crown 
 . . . allotment and appropriation of lands for the support and mainten- 
 ance of a Protestant clergy . . .' 31 Geo. iii, c. 31, s. 36, et seq. 
 
British Principles 19 
 
 friends whom they desired to benefit, or it may be enemies 
 whom they were willing to injure,' the members of the Council 
 almost uniformly exercised their powers 'for purely colonial 
 purposes' and 'for local or personal objects.'® The notorious 
 practice of 'leader' and 'associates' by which the 'associates' 
 agreed to transfer to a 'leader' or promoter the grants of 
 land which were made (to the maximum area allowed by the 
 land regulations) nominally to themselves, was reduced to a 
 system in Lower Canada until under one administration, that 
 of Sir Robert Shore Milnes, six members of the Executive 
 Council who constituted the Land Board granted about 
 1,425,000 acres to fewer than 65 individuals. The Lower 
 Canadian Assembly submitted that 'the management of the 
 waste lands of the crown has been vicious and improvident'; 
 and even the Select Committee of the British House of 
 Commons on the State of the Civil Government of Canada in 
 1828 censured the practice of 'making grants of land in large 
 masses to individuals who had held official situations in the 
 Colony.'® 
 
 The nominal control over the administration of the crown 
 lands and the beneficial interest therein, however, were still 
 jealously retained in the name of the Crown. As late as 
 1831, the Canadian Revenue Control Act (1 & 2 Will, iv, c. 23) 
 in granting the Assembly of the province the control of the 
 taxes under the Quebec Revenue Act of 1774 (14 Geo. iii, c. 88) 
 specifically reserved the 'casual and territorial revenues of 
 the Crown.' The Governor, Lord Aylmer, contended in that 
 year (1831) that these revenues 'stand upon a perfectly 
 different ground from taxes, properly so called. They are 
 enjoyed by the Crown, by virtue of the Royal Prerogative, 
 and are neither more nor less than the proceeds of landed 
 property, which legally and constitutionally belongs to the 
 Sovereign on the throne.'® Until the Act of Union, in fact, 
 the crown lands, as Charles BuUer expressed it in his special 
 
 ®Report on Public Lands and Emigration, by Charles Buller for Lord 
 Durham, 1838, Lord Durham's Report, ed. Lucas, iii, 37-38. 
 
 ©Kennedy's Documents of the Canadian Constitution, pp. 348, 352. 
 ®See, however, Lord Durham's Report, ed. Lucas, i. 185. 
 
20 British Principles 
 
 report to Lord Durham in 1838, were 'in name the property 
 of the Crown, and under the control of an English minister;® 
 while the Assembly claimed that the administration of the 
 crown lands ought to be entrusted to ministers responsible 
 to the Assembly, and that revenue arising therefrom ought to 
 be under the 'control of the representatives of the people.'© 
 1840. These claims were definitely concefled by the Act oj 
 
 Union, 1840, and by the practice of responsible government 
 subsequently acted upon by British governors. In view of 
 the importance of the principles involved, it may be advisable 
 to trace briefly this final stage of the long controversy until 
 it was definitely closed by Imperial enactment conceding 
 specifically to self-governing provinces, (a) the beneficial 
 interest in the public domain, and (6) the administration 
 thereof, as indispensable adjuncts of 'responsible government.' 
 (a) Beneficial Interest. By the Act of Union, 1840, it is 
 provided that 'all the territorial and other revenues now at 
 the disposal of the Crown within the Province of Canada' 
 should be surrendered to the consolidated revenue fund of the 
 province in return for a fixed 'Civil List' of £75,000.® That 
 is to say, it took here as elsewhere the form of a bargain or 
 compact: the grant of territorial revenues in return for 
 assuming the obligations ('Civil List') of self-government. 
 A similar controversy had been going on, however, in Great 
 Britain itself with regard to the surrender of what were 
 called 'the casual and territorial revenues of the Crown' to 
 the Imperial Parliament. This has been effected by Civil 
 List Acts® passed at the beginning of each reign for the life- 
 time of the sovereign. Since, however, these 'casual and 
 territorial revenues of the Crown,' thus surrendered to the 
 Imperial Parliament by the Civil List Acts, included theor- 
 
 ®Lord Durham's Report, ed. Lucas, iii. 37-38. 
 
 ® Ninety-Two Resolutions, Lower Canadian Assembly, February 21, 
 1834. 
 
 ®3 & 4 Vic, c. 35, s. 54. 
 
 ®1 Will, iv, c. 25, b. 2; 1 & 2 Vic, u. 2, s. 2. 
 
 Similar Acts have been passed at the beginning of the reigns of Edward 
 vii and George v (64 Vic. & 1 Edw. vii, c 4 and 10 Edw. vii & 1 Geo. v, 
 c. 28). 
 
British Principles 21 
 
 etically the territorial revenues from the crown lands of the 
 whole Empire, it was deemed advisable definitely to renounce 
 by Imperial Act all beneficial interest in these lands. This 
 was effected in 1852 by 15 & 16 Vic, c. 39, which specifically 
 excepted from the 'casual and territorial revenues of the 
 Crown' accruing to the consolidated fund of Great Britain 
 through the Civil List Acts all 'monies arising from the 
 sale or other disposition of the lands of the Crown in any of 
 Her Majesty's colonies or foreign possessions.' This Act 
 (15 & 16 Vic, c. 39), therefore, marks the formal concession 
 of the demands of self-governing provinces to full beneficial 
 interest in the public domain within their boundaries. 
 
 (6) Administration. The process of putting the principles 
 of responsible government into practical operation was 
 necessarily slow and tentative. It was not until the time of 
 Lord Elgin that it became a settled policy on the part of the 
 Governor to throw 'the whole weight of responsibility on 
 those who exercise the real power.'® The administration of 
 government, including the whole system of land-granting, etc., 
 thus devolved upon ministers directly responsible to an 
 elective assembly, and the full provincial control of the public 
 domain thus formed a perfectly normal and indeed inevitable 
 development. 
 
 Here again in its final stages, however, the principle is 
 established not merely by practice in self-governing provinces 
 but by the express provisions of Imperial statute. Even in 
 the Act of Union, 1840, 'Her Majesty's prerogative touching 
 the granting of waste lands of the Crown' had been safe- 
 guarded by providing that Canadian bills relating thereto 
 should 'be laid before both Houses of Parliament of the 
 United Kingdom of Great Britain and Ireland' before receiv- 
 ing the royal assent.® By the Union Act Amendment Act of 
 1854 these provisions were repealed and the royal assent 
 could thus be given at once by the Governor to provincial 
 bills relating to the public domain.® This act may thus be 
 
 ©Lord Elgin to the Duke of Newcastle, March 26, 1853. 
 ®3 & 4 Vic, c. 35, s. 42. 
 ®17 & 18 Vic, u. 118, s. 6. 
 
22 British Principles 
 
 said to have completed the process of vesting in the provincial 
 legislatures of Canadian provinces long before Confederation 
 the full control of the actual administration of the crown 
 lands. 
 
 The double principle, therefore, of administration of crown 
 lands by provincial legislatures and the enjoyment of the full 
 beneficial interest therein for local purposes came to take the 
 form with which all the provinces of Canada, with the ex- 
 ception of the Prairie Provinces, have since been familiar. 
 The Colonial Office, it will be seen, expressed the latter part 
 of this principle with particular emphasis in negotiating with 
 the Hudson's Bay Company with regard to Rupert's Land. 
 'It is clear that colonists of the Anglo-Saxon race look upon 
 the land revenue as legitimately belonging to the commun- 
 ity.'® The beneficial control of the public domain has thus 
 accrued to every self-governing province where the principles 
 of 'responsible government' are applied and pushed to their 
 logical conclusion. It accrued naturally and normally to 
 Newfoundland, New Zealand and the provinces of the 
 Australian Commonwealth. In each case it took the form of 
 a compact; the grant of the beneficial control of the public 
 domain in return for undertaking the duties and obligations 
 of self-government. Both in 'Canada' and the Maritime 
 Provinces 'the plan adopted in every case of the grant of 
 responsible government,' as Keith points out, 'took the form 
 of a grant of full rights over the lands in exchange for a 
 civil list.'® 
 
 One phase of the question, indeed, is worthy of special 
 consideration because it affords almost an exact parallel to 
 the policy of the federal government in the administration of 
 the public domain of Manitoba since 1870. Lord Durham, 
 though the apostle of responsible government in many other 
 respects, was prepared to accept at that stage of the develop- 
 ment of new provinces (1838), the plans of Gibbon Wakefield 
 
 (^Correspondence relating to the Surrender of Rupert's Land, 1869, 
 Appendix iii, p. 68. 
 
 ®Responsible Government in the Dominions, ii, 1047. 
 
British Principles 23 
 
 and Charles BuUer for Imperial colonization and control of 
 crown lands: 'I therefore propose that the entire administra- 
 tion of it should be confided to an imperial authority.'© 
 
 Charles Buller, whose special report on Public Lands and 
 Emigration formed the basis of Durham's recommendations, 
 proposed that all revenues arising from this uniform and 
 logical system of colonization 'should be specifically ap- 
 propriated to such work as would improve the value of land 
 and facilitate the progress of settlement' ;@ and Lord Durham 
 himself in recommending that 'all the revenues of the Crown 
 . . . should at once be given up to the United Legislature 
 on the concession of an adequate civil list' specifically excepted 
 those and those only which were derived from the public 
 lands.® 
 
 It is significant that though Durham's scheme with regard 
 to public lands in that formative period of colonial develop- 
 ment has commanded much admiration, the proposal was 
 still-born and the territorial revenues of the crown, as already 
 noted, were conceded in their entirety to the Canadian 
 legislature. As Lucas points out, 'the proposed combination 
 with the grant of responsible government of Imperial control 
 over the public lands'© was in the nature of things 'im- 
 possible.' Even Buller had stated the alternative to Imperial 
 control in terms which leave nothing to be desired: 
 
 'I am also bound to recommend, that in the event of 
 'such a course not being deemed expedient, the whole 
 'control of the property should be vested in the most 
 'ample and unconditional manner in the Colonial Legisla- 
 'ture. This is required by every principle of justice.'® 
 
 Durham's recommendations, therefore, with regard to 
 perhaps the most elaborate and broadly-based scheme of 
 colonization ever devised, remained in Canada a dead letter. 
 The principle of beneficial control by local legislatures ' was 
 
 ®Lord Durham's Report, ed. Lucas, ii, 327. 
 ®Lord Durham's Report, ed. Lucas, iii, 115. 
 ®Lord Durham's Report, ed. Lucas, ii, 327. 
 ®Lord Durham's Report, Introduction, i, 182. 
 ®Lord Durham's Report, ed. Lucas, iii, 39-40. 
 
24 British Principles 
 
 responsible for vesting in each of the original provinces of 
 Confederation the rights over the public domain which they 
 have enjoyed ever since, and the constitutional rights which 
 they seek to deny to the Prairie Provinces in the twentieth 
 century are thus the same rights which they themselves 
 vindicated — even against the apostle of responsible govern- 
 ment in other forms, Lord Durham himself — during the 
 first half of the nineteenth. The arguments employed against 
 the provincial rights of the Prairie Provinces 'would have 
 justified' (to quote the words of one of the most eminent of 
 Canadian constitutionalists on a very memorable occasion) 
 'the retention by the Imperial government up to the present 
 time of every acre of Crown Lands in Canada.'® 
 
 As already indicated, these recognized provincial rights 
 were safeguarded in section 109 of the B.N. A. Act of 1867, 
 and so well established were these principles that when 
 British Columbia entered Confederation they were applied to 
 that province automatically without even the formalities of 
 perfunctory discussion.® In Prince Edward Island heavy 
 obligations were gratuitously assumed by the Dominion in 
 order to 'establish this Colony in a position as regards land 
 tenures and territorial revenues, similar to that occupied by 
 the adjoining Provinces.'® For thirty-five years Manitoba 
 remained the solitary exception to the general rule. The 
 Prairie Provinces of Canada alone among the self-governing 
 provinces and Dominions of the British Empire are still living 
 in respect of our natural resources under 'colonial' conditions, 
 in some respects more reactionary than those which prevailed 
 a hundred years ago in the provinces of British North 
 America. In 1830 the crown lands, as Buller pointed out, 
 were at least administered by residents of the province 'for 
 
 ®In discussing these very proposals of Lord Durham. 'It was ab- 
 solutely impracticable ... To the people living in and developing any 
 dependency must be entrusted, and might safety be entrusted, the entire 
 control of the public lands . . .' Sir Robert Borden, Hansard, 1905, 
 p. 1462. 
 
 ®See Chapter V. 
 
 ®See Chapter VI. 
 
British Principles 25 
 
 purely colonial purposes' and 'for local or personal objects.'® 
 By statute which the Dominion imposed upon this Province 
 against her will (as expressed on at least four occasions) in 
 respect of public lands,® the natural resources of Manitoba 
 are 'administered by the Government of Canada for the 
 purposes of the Dominion.'® 
 
 Canada, therefore (as Keith points out), 'has not adopted 
 the British ideas in dealing with the land in the new provinces,' 
 and the Dominion 'manages to control lands despite the 
 existence of the provinces ... in a way which would 
 never have been possible to an Imperial power which had no 
 direct share in the ordinary government of the country.'® 
 Despite our representation in a federal capacity at Ottawa, 
 half a century has passed since British 'rights' to the 'full 
 control of all the public land' were claimed for the 'Local 
 Legislature.' Manitoba has exercised self-government with a 
 'civil list' for fifty years without receiving, according to 
 British practice, 'full rights over the lands in exchange.' 
 The beneficial control of the public domain is implicit in full 
 provincial status under responsible government, yet the 
 fundamental British principles upon which the historic claims 
 of Manitoba as a Canadian province since 1870 are based, 
 have yet to be applied or even conceded to this province in 
 anything like their logical entirety. 
 
 SUMMARY. 
 
 1. The claim to (a) the administration of the public 
 domain, (b) the beneficial interest therein, formed an integral 
 part of the conflict for 'responsible government' in Canada. 
 
 2. Both these functions were definitely conceded more than 
 seventy-five years ago to provinces under 'responsible govern- 
 ment,' Imperial beneficial control being definitely renounced 
 by statute (15 & 16 Vic, c. 39 and 17 & 18 Vic, c 118). 
 
 (SLord Durham's Report, ed. Lucas, iii, 37-38. 
 
 ®See Chapter IV. 
 
 ® Manitoba Act, 33 Vic, c. 3. s. 30. 
 
 ®Responsible Government in the Dominions, ii, 1051, 1053. 
 
26 British Principles 
 
 Both functions, therefore, were implicit in provincial status 
 for all the original provinces of Canada. 
 
 3. When these provinces united to form Confederation 
 these rights were confirmed in B.N. A. Act, 1867, s. 109. 
 
 4. Similarly in Newfoundland, New Zealand, the provinces 
 of the Australian Commonwealth, the same principles are 
 uniformly in operation. 'Colonists of the Anglo-Saxon race 
 look upon the land revenue as legitimately belonging to the 
 community.' (Colonial Office, 1864, re Rupert's Land). 
 
 5. 'The plan adopted in every case of the grant of re- 
 sponsible government . . . took the form of a grant of 
 full rights over the lands in exchange for a civil list' {Keith), 
 viz., a compact involving the grant of the beneficial control 
 of the public domain in return for undertaking the obligations 
 of self-government. Manitoba has discharged the duties of 
 'responsible government' with full 'civil list' since 1870 and 
 has been denied for fifty years 'full rights over the lands in 
 exchange.' 
 
 6. Even Lord Durham's proposals with regard to Imperial 
 control of crown lands for purposes of scientifically directed 
 colonization were still-born in Canada, and the only alterna- 
 tive was that 'the whole control of the property should be 
 vested in the most ample and unconditional manner in the 
 Colonial Legislature. This is required by every principle of 
 justice.' (Buller). 
 
 7. The constitutional rights which the original provinces 
 of Confederation now seek to deny to the Prairie Provinces 
 in the twentieth century are the same rights which they 
 themselves vindicated, even against Lord Durham, during 
 the first half of the nineteenth. The arguments employed 
 against the provincial rights of the Prairie Provinces 'would 
 have justified the retention by the Imperial government up 
 to the present time of every acre of Crown Lands in Canada.' 
 (Sir Robert Borden in 1905). 
 
 8. In respect of public lands, Manitoba is still a 'colony' 
 of the Dominion, with this difference for the worse, that 
 whereas the crown lands before 'responsible government' 
 were administered by residents of the province 'for purely 
 colonial purposes' and 'for local or personal objects' (Buller) 
 those of Manitoba are administered, by Dominion statute, 
 'by the Government of Canada for the purposes of the 
 Dominion.' 
 
III. 
 
 THE SURRENDER OF CHARTERED RIGHTS 
 IN RUPERT'S LAND 
 
 AND THE 
 
 'TRANSFER' TO CANADA, 1870. 
 
 The reluctance of the other provinces of Canada to 
 concede to the Prairie Provinces the status which they them- 
 selves have always enjoyed has been defended — and in some 
 quarters seems to be defended still — upon the contention that 
 'Rupert's Land' and the 'North-Western Territory' were 
 ■purchased' from the Hudson's Bay Company and thus 
 became the 'property' of Canada, to be administered 'for 
 the purposes of the Dominion.' The evidence in the case 
 indicates that this view is not warranted by the facts, and 
 that the contention based upon that view has no parallel in 
 British constitutional practice. The negotiations preceding 
 the transfer form a very intricate and complicated process, 
 but the transfer itself would seem to have been effected with 
 scrupulous regard for sound constitutional procedure. The 
 principles involved may perhaps be outlined for all practical 
 purposes by examining (a) the nature of the so-called 'pur- 
 chase,' (6) the actual procedure, and implications of that 
 procedure, involved in the surrender of the Hudson's Bay 
 Charter rights over 'Rupert's Land' to the Crown and the 
 transfer of both 'Rupert's Land' and the 'North-Western 
 Territory' by the Crown to Canada. 
 
 (A) — The Nature of the 'Purchase.' 
 
 The extension westward of the Province of Canada, and 
 after 1867 of the Confederated Dominion, had long been 
 generally accepted in Great Britain and in Canada, and even 
 at the Red River Settlement, as an inevitable development. 
 In 1857 the Select Committee of the British House of 
 Commons in their famous Report recommended that 'the 
 
28 The Surrender and the 'Transfer' 
 
 districts on the Red River and the Saskatchewan' should be 
 'ceded to Canada' by 'arrangements as between Her Majesty's 
 Government and the Hudson's Bay Company.'® In the 
 British North America Act, 1867, section 146, provision is 
 made: 
 
 'on Address from the Houses of Parliament of Canada to 
 'admit Rupert's Land and the North-Westem Territory, 
 'or either of them, into the Union, on such terms and 
 'conditions in each case as are in the Addresses expressed 
 'and as the Queen thinks fit to approve, subject to the 
 ■provisions of this Act.' 
 
 Pursuant to this section of the B.N. A. Act of 1867 a 
 joint address of the Canadian Senate and House of Commons 
 was passed (December 16 and 17, 1867), praying to be 
 allowed to 'assiune the duties and obligations of government 
 as regards these territories' and urging 'the formation therein 
 of political institutions bearing analogy, as far as the circum- 
 stances will admit, to those which exist in the several prov- 
 inces of the Dominion.' 
 
 As early as 1864, however, the Hudson's Bay Company 
 expressed a willingness to have the Red River district formed 
 into a Crown Colony. In the preceding year the control of 
 the Company had been purchased by the International 
 Financial Company, and one of the stipulations in connection 
 with the 'introduction of the direct authority of Her Majesty's 
 Government into Rupert's Land' was the retention of an 
 extensive proprietary control of the land by the Hudson's 
 Bay Company.® It was chiefly upon this issue that the 
 Colonial Office refused to entertain the proposal, and the 
 
 ®Report from the Select Committee on the Hudson's Bay Company, p. iv. 
 
 ©Negotiations embodied in a series of letters between the Colonial 
 Office and the H.B. Company, dated March 11, April 6, and June 6, 1864, 
 from the Colonial Office and April 13 and December 7, 1864, from the 
 Company. 'The compensation should be derived from the future proceeds 
 of the lands, and of any gold which may be discovered in Rupert's Land, 
 coupled with reservations of defined portions of land to the Company.' 
 
 Correspondence relating the the Surrender of Rupert's Land by the Hud- 
 son's Bay Company and for the Admission thereof into the Dominion of 
 Canada, 1869, p. 22. 
 
The Surrender and the 'Transfer' 29 
 
 chief reasons are stated in very significant terms by the 
 Colonial Office to Sir Edmund Head: 
 
 'In an unsettled colony there is no effectual mode of 
 'taxation for purposes of government and improvement, 
 'and the whole progress of the Colony depends on the 
 'liberal and prudent disposal of the land . . . 
 
 'It is clear that colonists of the Anglo-Saxon race look 
 'upon the land revenue as legitimately belonging to the 
 'community.'© , 
 
 When negotiations were resumed, therefore, in 1868-9, 
 with a view to uniting 'Rupert's Land' to the newly formed 
 Canadian Confederation, the claim for 'compensation' was 
 jealously retained by the Company, but the basis was altered 
 to 'the payment ... of a sum of hard money,' the sum 
 of 'one million sterling, in bonds' being mentioned by the 
 Company as a settlement which 'might be acceptable to our 
 proprietors.'® The Company insisted, moreover, upon 
 another Act of Parliament to guarantee this compensation 
 for the surrender of Charter rights to the Crown, because 
 section 146 of the B.N. A. Act of 1867 would have left the 
 claims of the Company at the mercy of Canadian courts.® 
 It thus came to pass that the instrument under which the 
 surrender was effected was the Rupert's Land Act, 31 & 32 
 Vic, c. 105, which, as the Canadian delegates. Sir George E. 
 Cartier and the Hon. William McDougall, protested, 'was not 
 introduced at the instance or passed in the interest of the 
 Canadian Government'®; and behind the Rupert's Land Act, 
 beyond a doubt, certain monetary considerations had already 
 begun to appear. 
 
 Now it cannot be emphasized too strongly that Canada 
 
 . contended throughout for the transfer of Rupert's Land to 
 
 Canada by Imperial Order in Council pursuant to the 
 
 (^Correspondence relating to the Surrender of Rupert's Land, 1869, 
 Appendix iii, p. 68. 
 
 ®Lord Kimberley to Colonial OflSce, October 27, 1868, Correspondence 
 relating to Surrender of Rupert's Land, p. 25. 
 
 ®Id. p. 20. 
 
 ®Id. p. 45. 
 
30 The Surrender and the 'Transfer' 
 
 B.N. A. Act, 1867, section 146, and without negotiations with 
 any third party in the case. A memorandum drawn up by 
 the Canadian delegates and approved by the Canadian 
 Privy Council, December 28, 1867, expressed 
 
 'the opinion of the Canadian Government, that it is 
 'highly expedient that the transfer which the Imperial 
 'Government has authorized, and the Canadian ParUa- 
 'ment approved, should not be delayed by negotiations 
 'or correspondence with private or third parties.'® 
 
 This insistence could be illustrated in great detail, and it 
 is important, because cession by the Crown, so scrupulously 
 observed, it will be seen, in the procedure of the actual trans- 
 fer, carries with it the implication that the ceded territory 
 was entitled to inherit all the rights as well as obligations 
 attaching (in Manitoba) to self-government and provincial 
 status; that 'its settlement,' as the Colonial Office very 
 significantly pointed out to the Governor-General of Canada 
 on November 30, 1869, was to proceed 'as a part of the 
 British Colonial System.'® Even after the monetary com- 
 pensation to the Hudson's Bay Company had been agreed 
 upon, the Canadian Privy Council, December 16, 1869, 
 distinguished very clearly between 'the surrender by the 
 Company to the Queen and the transfer by Her Majesty to 
 the Dominion.' In a telegram to the. Colonial Office it is 
 urged that 'on surrender by Company to Queen, the Govern- 
 ment of the Company ceases. The responsibility of ad- 
 ministration of aflairs will then rest on Imperial Government. 
 Canada cannot accept transfer unless quiet possession can be 
 given.' The evidence upon this point is very conclusive. 
 
 Now the monetary consideration was introduced through 
 the insistence, as already pointed out, of the Hudson's Bay 
 
 ©'Whose position, opinions, and claims have heretofore embarrassed 
 both Governments in dealing with this question.' Correspondence relating 
 to the Surrender of Rupert's Land, 1869, p. 3. 
 
 ©Quoting, in fact, an Order in Council of the Province of Canada of 
 June 22, 1866. Granville to Young, November 30, 1869, Correspondence 
 connected with Recent Occurrences in the North-West Territories, 1870, p. 139. 
 
The Surrender and the 'Transfer' 31 
 
 Company. Had the whole transaction been effected by the 
 B.N. A. Act, 1867, section 146, alone, the Company pointed 
 out that their proprietary rights would have been left at the 
 mercy of Canadian courts. The new Act, therefore, the 
 Rupert's Land Act, 1868, provided specifically for two things: 
 (a) the surrender of all Charter rights in 'Rupert's Land' to 
 the Crown 'upon such Terms and Conditions as shall be 
 agreed upon by and between Her Majesty and the said 
 Governor and Company,' and (6) that by Imperial Order in 
 Council Rupert's Land 'shall, from a Date to be therein 
 mentioned, be admitted into and become a Part of the 
 Dominion of Canada.'® It is noteworthy that the second 
 of these provisions merely reiterates the B.N. A. Act, 1867, 
 s. 146, while Canada does not appear at all as yet in the 
 first. The two Canadian delegates lost no time in pointing 
 out that: 
 
 'The Act 31 & 32 Vic, c. 105 (which was not introduced 
 'at the instance or passed in the interest of the Canadian 
 'Government), placed the negotiations of the terms of 
 'surrender by the Company to the Crown in the hands 
 'of Her Majesty's Government where ... we are of 
 'opinion it must remain.'® 
 
 It now becomes possible to trace the way in which Canada 
 became involved in this matter of 'compensation' to the 
 Hudson's Bay Company for the surrender of Charter rights 
 to the Crown. The Dominion was drawn into the monetary 
 bargain between the other two parties in the transaction 
 through the terms of the Rupert's Land Act. -That ntieasure 
 had been introduced in the House of Lords, but when it 
 reached the House of Commons, section 3 (providing for the 
 surrender of Charter rights by the Company and the accept- 
 ance of the surrender under Her Majesty's 'Sign Manual and 
 Signet . . . upon such Terms and Conditions as shall be 
 agreed upon by and between Her Majesty and the said 
 
 ®31 & 32 Vic, c. 105, s. 3 and 5. 
 
 ^Correspondence relating to the Surrender of Rupert's Land, 1869, p. 44. 
 
32 The Surrender and the 'Transfer' 
 
 Governor and Company') was amended by the addition of 
 the following significant proviso: 
 
 'provided further that no Charge shall be imposed by 
 'such Terms upon the Consolidated Fund of the United 
 'Kingdom.'© 
 
 It became obvious, therefore, that if a pecuniary com- 
 pensation 'in hard money' was a sine qua non of the surrender 
 of the Hudson's Bay Charter rights in Rupert's Land to the 
 Crown, and if the transaction was to involve 'no Charge 
 . . . upon the Consolidated Fund of the United Kingdom,' 
 it would be necessary for Canada to undertake the indemnity 
 to the Hudson's Bay Company. This was undertaken by 
 the Canadian delegates under protest and without waiving 
 the rights of direct cession from the Crown. The sum of 
 £300,000, it was stated by the Canadian delegates Cartier 
 and McDougall to the Colonial Office, February 8, 1869, was 
 regarded by them as a species of settlement by compromise 
 out of court — the 
 
 'cost of legal proceedings necessary, if any be necessary, 
 'to recover possession . . . Compromises of this kind 
 "are not unknown in private life, and the motives and 
 'calculations which govern them may be applicable to 
 'the present case.'® 
 
 ® Hudson's Bay Company Bill (H.L.) 
 Commons Amendment. Ordered to be printed, 23rd July, 1868. 
 The Rupert's Land Act received the royal assent, July 31, 1868. 
 
 ® Report of Delegates appointed to negotiate for the Acquisition of Rupert's 
 Land and the North-West Territory, Ottawa, 1869. 
 
 This report was formally approved by Canadian Order in Council, on 
 May 14, 1869. 
 
 The negotiations are remarkable for the precision and accuracy of the 
 constitutional terms employed. The only lapse on the part of the Colonial 
 Office would seem to have taken place under vexation at a juncture when 
 the negotiations threatened to break down altogether. Even here the argu- 
 ment of the Under-Secretary is found to be specious to the point of dis- 
 ingenuousness. The Canadian delegates were pressing for 'the immediate 
 transfer of the sovereignty of the whole territory' while the Company was 
 still pressing for the payment of £1,000,000 in 'hard money' or bonds. The 
 Colonial Office, entrenched behind the amendment to the Rupert's Land 
 Act (providing that 'no Charge shall be imposed . . . upon the Con- 
 <solidated Fund of the United Kingdom') was in a position to disclaim all 
 pecuniary interest and responsibility. Resorting to the language of the 
 
The Surrender and the 'Transfer' 33 
 
 The terms were finally drawn up categorically by the 
 Colonial Office and ofEered by the Colonial Secretary to the 
 Hudson's Bay Company on March 9, 1869, 'not ... as 
 a basis of further negotiation, but a final effort to effect that 
 amicable accommodation, of which he has almost despaired.' 
 These terms® were accepted by the Company on April 9 and 
 ratified by a joint address of the Senate and House of 
 Commons of Canada on May 29 and 31, 1869, on the re- 
 commendation of the Canadian delegates. 
 
 Whatever monetary and proprietary considerations were 
 necessary, therefore, in order to effect the transfer, it is seen 
 that, both in theory and in fact, the surrender of the Hud- 
 son's Bay Charter rights in Rupert's Land to the Crown was 
 the only part of the transaction which involved 'compensa- 
 tion' of any kind. This surrender was formally signed and 
 sealed by the Company on November 19, 1869; it was 
 formally accepted by Her Majesty 'under the Sign Manual 
 and Signet' on June 22, 1870, and the transfer of Rupert's 
 Land to Canada did not take place until July 15. The pay- 
 ment of the £300,000, though stipulated in the terms to be 
 paid 'when Rupert's Land is transferred to the Dominion of 
 Canada' was made, as a matter of fact, on May 11, thus 
 synchronizing with the receipt of the deed of surrender by 
 the Colonial Office. The sum of £300,000 which was to be 
 
 counting-house, the Under-Secretary, Rogers, confronted the Company in 
 their demands for 'one miUion sterUng, in bonds' with the uncompromising, 
 not to say truculent, attitude of the Canadian delegates: 
 
 'You propose that the matter should be settled by the immediate 
 'payment of a fixed sum of money, or by the deUvery of bonds . . . 
 'It is, of course, obvious that this negotiation for the purchase of 
 'the Hudson's Bay Territory is really between the seller and the buyer, 
 'the Company and the Colony . . . Her Majesty's Government 
 '. . . can merely offer to act as a channel of accommodation between 
 'these two real parties to the transaction.' Rogers to Northcote, 
 February 22, 1869, Correspondence relating to the Surrender of Rupert's 
 Land, 1869, p. 37. 
 
 As a matter of fact, the terms, as stated above, were drawn up categori- 
 cally by the Colonial Of&ce; and the Rupert's Land Act had definitely 
 specified 'such "Terms and Conditions as shall be agreed upon by and between 
 Her Majesty and the said Governor and Company.' 31 and 32 Vic, c. 105, 
 s. 3. 
 
 ©Correspondence relating to the Surrender of Rupert's Land, 1869, p. 40. 
 
34 The Surrender and the 'Transfer' 
 
 raised by loan guaranteed by the British Rupert's Land Loan 
 Act (32 & 33 Vic, c. 101), was there specified as 'for the 
 purpose of payment to the Hudson's Bay Company on the 
 surrender of Rupert's Land,' and the Company was author- 
 itatively informed® that 'the indemnity of £300,000 will be 
 paid on due proof of the completion of their surrender.' 
 The payment of the £300,000 was thus occasioned not by the 
 transfer of Rupert's Land to Canada, for that was effected, 
 it will be seen, by full cession from the Crown; it was exacted 
 by the Hudson's Bay Company as a sine qua non for the 
 surrender of their Charter rights in Rupert's Land. 
 
 It may thus be contended that the object of both Canada 
 originally and the British Government was not to perpetuate 
 the old system of proprietary administration, the only 
 difference being that it should be continued 'for the purposes 
 of the Dominion' instead of for the purposes of the Hudson's 
 Bay Company, but rather to extinguish altogether the old 
 disabilities under the Charter of the Company in Rupert's 
 Land® by 'its settlement', as the Colonial Secretary pointedly 
 emphasized, 'as a part of the British Colonial System.' In 
 fact the whole transaction would seem to have been expressed 
 nowhere more succintly than by the Canadian delegates 
 themselves : 
 
 'The surrender of the powers of government and of 
 'territorial jurisdiction by the Company to the Crown, 
 "and the transfer of these powers to the Canadian 
 'Government, are acts of State, authorised by Imperial 
 'Statute, and will have all the force and permanence of 
 'fundamental law.'® 
 
 Under circumstances such as these, the indemnity of 
 
 ®By the agents of Canada, Messrs. Baring and Glyn. 
 Correspondence connected with the Recent Occurrences in the North- 
 west Territories, 1870, p. 139. 
 
 ®'Upon the Acceptance by Her Majesty of such Surrender, all Rights 
 of Government and Proprietary Rights, and all other Privileges, Liberties 
 . . . whatsoever, granted ... to the said Governor and Company 
 within Rupert's Land . . . shall be absolutely extinguished ..." 
 Rupert's Land Act, 1868, section. 4. 
 
 (^Correspondence relating to the Surrender of Rupert's Land, 1869, p. 45. 
 
The Surrender and the 'Transfer' 35 
 
 £300,000 to the Hudson's Bay Company, though paid by 
 Canada, no more entitled the Dominion to appropriate with- 
 out accountability the public domain of Manitoba 'for the 
 purposes of the Dominion' — to deprive the inhabitants of this 
 province, 'as a part of the British . . . System,' of 'full 
 rights over the lands in exchange for a civil list' — than the 
 indemnity paid by Great Britain to the slave-owners in 1834 
 entitled the Government to retain the slaves in a state of 
 perpetual bondage to the nation. 
 
 It may be added that the West is not 'the property' of 
 Canada since the public domain is 'vested in the Crown,'® 
 and that the £300,000 was not 'paid by' the rest of Canada 
 for the West in any case. It was paid immediately by 
 British bankers, and the amount was subsequently raised by 
 Canada (including Manitoba) by public loan guaranteed by 
 British Treasury Warrant of June 18, 1870, pursuant to the 
 Rupert's Land Loan Act,® 'the principal to be repaid on 1st 
 April, 1904.'® The per capita contribution of Manitoba to 
 Dominion customs revenues was for many years the highest 
 in Canada,® and thus even at the current conception of the 
 status of Manitoba so largely prevalent in Eastern Canada, 
 this province may be said to have discharged rather more 
 than her share of the 'purchase' price of her own public 
 domain. 
 
 (B) — The Procedure and Its Implications. 
 
 In order to trace this procedure consecutively it would be 
 necessary to outline the Acts, Joint Addresses pursuant 
 thereto, official reports, Orders in Council, etc. (some fifteen 
 in number) by which the surrender of the Hudson's Bay 
 
 ®33 Vic, c. 3, s. 30; 4 & 5 Edw. vii, c. 3, s. 21; 4 & 5 Edw. vii, c. 42, 
 s. 21; Keith, Responsible Government in the Dominions, i, 146, etc. 
 
 ®32 & 33 Vic, c. 101. See Statement of Proceedings taken by the Lords 
 Commissioners of Her Majesty's Treasury to give effect to the Guarantee of a 
 loan for the £300,000 authorised by the Act 32 & 33 Vic, c. 101. June 28, 
 1870. 
 
 ®Retum showing Terms on which the Dominion Loans . . . were 
 negotiated in London. Can. Sess. Papers, 1880, vol. x. Paper No. 75. 
 
 ®Memoranda and Statements prepared by the Hon. the Provincial 
 Treasurer of Manitoba, 1884, p. 11. 
 
36 The Surrender and the 'Transfer' 
 
 Charter rights in Rupert's Land to the Crown and the 
 transfer of 'Rupert's Land' and the 'North-Western Territory' 
 from the Crown to Canada were actually effected. The 
 nature and implications of these, however, may be summarized 
 in general terms without unnecessary detail. 
 
 It may be stated at once that scrupulous regard for sound 
 British constitutional procedure was observed throughout the 
 difficult process of transfer, and that the implications of that 
 procedure leave the British principles with regard to self- 
 governing communities — and above all, with regard to 
 Manitoba which was entrusted with provincial status from 
 the first — in full force and operation. 
 
 There were, as already pointed out, two distinct transac- 
 tions involved. The surrender to the Crown of the Hudson's 
 Bay Charter rights in Rupert's Land, involving the 'Surrender 
 of all or any of the Lands, Territories, Rights, Privileges, 
 Liberties, Franchises, Powers and Authorities whatsoever, 
 granted ... to the said Governor and Company within 
 Rupert's Land,'® was the only part of either transaction 
 which involved 'compensation.' The second transaction was 
 the cession by Imperial Order in Council (June 23, 1870) by 
 the Crown to Canada, not only of 'Rupert's Land' (which 
 could be ceded only after the surrender of the Hudson's 
 Bay Charter rights therein) but of the 'North-Western 
 Territory' which was not within the 'chartered' territory of 
 the Company and could, therefore, be ceded by the Crown 
 without a preliminary 'surrender.' The statutory basis of the 
 first of these transactions was the Rupert's Land Act, 1868; 
 that for the second was the B.N. A. Act, 1867, section 146, 
 which was reiterated in the Rupert's Land Act, section 5, in 
 respect of 'Rupert's Land,' in order that the 'Address from 
 the Houses of Parliament of Canada,' required by both Acts, 
 should include the 'Terms and Conditions . . . agreed 
 upon by and between Her Majesty and the said Governor 
 and Company.' Pursuant to these two Acts the deed of 
 surrender from the Company to the Crown is dated November 
 
 ® Rupert's Land Act, 1868, section 3. 
 
The Surrender and the 'Transfer' 37 
 
 19, 1869. This surrender was formally accepted by Imperial 
 Order in Council on June 22, 1870, and another Imperial 
 Order in Council of June 23, 1870, provided for the cession to 
 Canada to take place on July 15, 1870. In all these in- 
 struments, and particularly in the Imperial Order in Council 
 of June 23, 1870, actually effecting the transfer, there would 
 seem to be nothing more scrupulously precise than this 
 distinction between (a) the 'surrender to Her Majesty' of 
 "all the Rights . . . Privileges . Franchises, 
 
 Powers and Authorities' of the Charter in Rupert's Land, and 
 (6) the cession of 'Rupert's Land' and the 'North-Western 
 Territory' (the latter without 'Terms and Conditions') 'to be 
 admitted into and become part of the Dominion of Canada.'® 
 
 With regard to the North- Western Territory, therefore, it 
 is to be noted that admission into the Dominion was provided 
 without any 'Terms and Conditions' whatsoever by way of 
 'compensation' to the Company. By the terms of the Rupert's 
 Land Act it is seen that 'such Terms and Conditions as shall 
 be agreed upon by and between Her Majesty and the said 
 Governor and Company' apply exclusively to the 'Surrender 
 of all or any of the Lands, Territories, Rights, Privileges, 
 Liberties, Franchises, Powers, and Authorities whatsoever 
 granted ... by the said Letters Patent (viz., the Charter 
 of 1670) to the said Governor and Company within Rupert's 
 Land.'® The whole area outside Rupert's Land, therefore, 
 must be regarded as coming to Canada by direct cession from 
 the Crown, pursuant to the B.N. A. Act, 1867, section 146, 
 and without even the fictitious appearances of preliminary 
 'purchase.' As early as April 23, 1868, in fact, when the 
 Rupert's Land Act was first proposed, the Colonial Secretary 
 wrote to the Governor-General of Canada that 
 
 ®'In pursuance and exercise of the powers vested in Her Majesty by the 
 said Acts of Parliament ... the said North- Western Territory shall be 
 admitted into and become part of the Dominion of Canada . . . and 
 it is further ordered that . . . Rupert's Land shall . . . be ad- 
 mitted into and become part of the said Dominion of Canada upon the follow- 
 ing terms and conditions . . .' 
 
 ®31 and 32 Vic, c. 105, s. 3. 
 
38 The Surrender and the 'Transfer' 
 
 "with respect to the North- West Territory the same 
 'obstacles (viz., the necessity of extinguishing Hudson's 
 'Bay Charter rights) 'do not exist to the transfer of the 
 'greater part by the Crown to Canada af the present 
 'time.'© 
 
 Similarly, the Canadian Government acted consistently 
 upon this distinction between 'Rupert's Land' and the 'North- 
 Western Territory' when it advocated under the provisions 
 of the B.N. A. Act, 1867, section 146: 
 
 'either the im.mediate transfer of the sovereignty of the 
 'whole territory, subject to the rights of the Company, or 
 'a transfer of the sovereignty and property of all the 
 'territory not heretofore validly granted to, and now held 
 'by the Company under its Charter.'® 
 
 The 'licensed'® as distinct from the 'chartered' territory 
 of the Company was thus ceded to Canada untrammelled by 
 'Terms and Conditions' of any sort. In fact, a part of this 
 area, the Colonial Secretary (in the letter of April 23, 1868, 
 above quoted) proposed to retain for other purposes: 
 
 'A portion of the North-West Territory immediately 
 'adjacent to British Columbia, I am of the opinion that 
 'it will be necessary for the public advantage to retain in 
 'the possession of the Crown, with a view to its incorpora- 
 'tion with British Columbia.'® 
 
 The mainland district of British Columbia, in fact, had 
 already (1858) been created out of 'licensed' territory which 
 had stood in exactly the same relationship to the Hudson's 
 Bay Company as the 'North- Western Territory' admitted into 
 Canada in 1870. Over this area British Columbia, it will be 
 seen, assumed almost automatically, in 1871, full beneficial 
 control. Part even of the 'chartered' territory of Rupert's 
 
 ©Apr. 23, 1868. Correspondence relating to the Surrender of Rupert's 
 Land, 1869, p. 12. 
 
 ®Id. p. 37. 
 
 OLicenses granting monopoly of the fur-trade were granted to the 
 Company in 1821, 1838, etc., and applied roughly to the whole area not 
 drained by waters flowing into Hudson Bay. 
 
 (^Correspondence relating to the Surrender of Rupert's Land, 1869, p. 12. 
 
The Surrender and the 'Transfer' 39 
 
 Land, surrendered upon 'Terms and Conditions' in 1870, was 
 subsequently included in the Provinces of Ontario and Quebec; 
 in both cases the new territory was added by federal statute, 
 and in both cases the provinces assumed automatically full 
 beneficial control over the land. Perhaps the most anomalous 
 transaction of all was the granting of the 'railway strip,' 
 through Manitoba to Port Nelson, to Ontario at the Manitoba 
 Boundaries Extension Act of 1912, the full rights of property 
 therein being granted to Ontario while the land itself lies 
 within the boundaries of Manitoba. Both 'chartered' and 
 'licensed' territory ceded to Canada by the Crown in 1870 
 may without impropriety be placed beneath the beneficial 
 control of any province, it would seem, but Manitoba, 
 Saskatchewan and Alberta. 
 
 By the constitutional procedure scrupulously followed in 
 the transfer, therefore, both 'Rupert's Land' and the 'North- 
 Western Territory' came to Canada not from the Hudson's 
 Bay Company by 'purchase' but from the Crown by 'Acts 
 of State authorised by Imperial Statute,' with 'all the force 
 and permanence of fundamental law.'® There were weighty 
 considerations of national policy in 1870 for retaining tem- 
 porarily a large measure of federal control over these lands in 
 order to facilitate immigration, etc., but the phrase 'for the 
 purposes of the Dominion' in the Manitoba Act has con- 
 stituted for more than fifty years an unwarranted violation 
 of fundamental British principles. In British Columbia, it 
 will be seen,® where the Hudson's Bay Company's rights 
 (by Letters Patent of January 13, 1849) in Vancouver Island 
 had really been 'purchased' in 1867 by the British Govern- 
 ment for £57,500, there was no attempt at reimbursement by 
 appropriating the beneficial interest in the public domain 'for 
 the purposes of Great Britain. British Columbia entered 
 Confederation in 1871 with the full beneficial control of 
 crown lands of the province. By joint address of December 
 
 ©Correspondence relating to the Surrender of Rupert's Land, 1869, p. 45. 
 ®See Chapter V, and Can. Sessional Papers, 1872, Vol. 6, Paper No. 10, 
 Appendix TT. 
 
40 The Surrender and the 'Transfer' 
 
 16 and 17, 1867, the Canadian Houses of Parliament under- 
 took to deal with the native population of Rupert's Land 'in 
 conformity with the equitable principles which have uniformly 
 governed the British Crown.' Similar obligations, advocated 
 by a Canadian Order in Council and enjoined by the Colonial 
 Office, may be held to obtain with regard to this province 'as 
 a part of the British . . . System' since 1870. 
 
 SUMMARY 
 
 The reluctance of other provinces to concede to Manitoba 
 the status in respect of public domain which they themselves 
 have always enjoyed has long been defended upon the claim 
 that Rupert's Land was 'purchased' from the Hudson's Bay 
 Company and became, therefore, the 'propetty' of Canada. 
 
 (A) — The Nature of the 'Purchase.' 
 
 1. The H.B.C. prepared in 1864 to recognize a Crown 
 Colony in Rupert's Land provided the Company retained 
 extensive proprietary control of the land. 
 
 2. This proposal was refused by the Colonial Office 
 because 'colonists of the Anglo-Saxon race look upon the land 
 revenue as legitimately belonging to the community.' 
 
 3. The H.B.C. therefore, demanded (1868-9) 'the payment, 
 as compensation, of a sum of hard money' for the surrender 
 of their chartered rights. 
 
 4. Canada, however, insistently urged direct cession by 
 the Crown (by the B.N.A. Act, 1867, s. 146) 'without 
 negotiations with any third party in the case.' Even when 
 indemnity for surrender of chartered rights became necessary, 
 Canadian delegates regarded it as the 'cost of legal proceed- 
 ings necessary ... to recover possession.' Conclusive 
 evidence of 'cession' as the official view of Canadian Govern- 
 ment. 
 
 5. Insistence of H.B.C. on monetary compensation led to 
 the Rupert's Land Act, 1868, providing: 
 
 (a) Surrender of all rights under the Charter in Rupert's 
 Land to the Crown 'upon such Terms and Conditions 
 as shall be agreed upon by and between Her Majesty 
 and the said Governor and Company.' 
 
 (b) Union with Canada by Imperial Order in Council as 
 under B.N.A. Act, 1867, section 146. 
 
ThE Surrender and the 'Transfer' 41 
 
 6. Canada was forced into this monetary transaction by 
 amendment to the Rupert's Land Act in the House of 
 Commons, by proviso that 'no Charge should be imposed by 
 such Terms upon the Consolidated Fund of the United 
 Kingdom.' 
 
 7. Canada, therefore, was forced to indemnify the H.B.C. 
 for the surrender of chartered rights in Rupert's Land to 
 the Crown, and this was the only part of either transaction 
 involving 'compensation' of any kind. 
 
 8. Object of whole transfer was not to perpetuate pro- 
 prietary administration 'for the purposes of the Dominion' 
 but that the old 'Proprietary Rights,' etc., of the Company 
 should be 'absolutely extinguished' (Ruperts' Land Act) in 
 order to expedite 'settlement as a part of the British Colonial 
 System.' (Colonial Office). 
 
 9. The transfer from the Crown to Canada by Order in 
 Council, therefore, was by cession with all constitutional 
 implications unimpaired: 'the surrender ... by the 
 Company to the Crown and the transfer ... to the 
 Canadian Government, are Acts of State, authorised by 
 Imperial Statute, and will have all the force and permanence 
 of fundamental law' (Canadian delegates). 
 
 10. The £300,000 was raised by loan, guaranteed by the 
 British Government, 'the principal to be repaid on 1st April, 
 1904.' 
 
 (B) — The Procedure and its Implications. 
 
 1. Two distinct and fundamental transactions were 
 involved: 
 
 (a) surrender of the Hudson's Bay Charter rights in 
 Rupert's Land to the Crown 'upon such Terms and 
 Conditions as shall be agreed upon by and between 
 Her Majesty and the said Governor and Company;' 
 
 (b) cession of 'Rupert's Land' and 'North-Western 
 Territory' to Canada by Imperial Order in Council of 
 June 23, 1870. 
 
 2. The statutory basis of (a) was Rupert's Land Act; that 
 of (b) was B.N. A. Act, 1867, section 146, reiterated in 
 Rupert's Land Act, section 5. 
 
 3. The surrender of chartered rights in Rupert's Land 
 by the Hudson's Bay Company to the Crown was dated 
 November 19, 1869; the surrender was received by the 
 Colonial Office and £300,000 paid on May 11, 1870; the 
 
42 The Surrender and the 'Transfer' 
 
 surrender of chartered rights was formally accepted by the 
 Crown by Order in Council of June 22, 1870; 'Rupert's Land' 
 and 'North-Western Territory' united to Canada on July 15 
 by Imperial Order in Council of June 23, 1870. 
 
 4. The 'Terms and Conditions' involving 'compensation' 
 provided for in the Rupert's Land Act apply exclusively to 
 Rupert's Land. The whole area outside Rupert's Land ('the 
 North- Western Territory'), therefore, must be regarded as 
 coming directly to Canada from the Crown by cession under 
 B.N. A. Act, 1867, section 146, and without even the 
 fictitious appearances of preliminary 'purchase.' This is 
 clear from the correspondence of the Colonial Office at the 
 time of the Rupert's Land Act, the attitude of the Canadian 
 Government, etc. 
 
 5. Mainland district of British Columbia already created 
 (1858) out of 'licensed' territory in same relationship to 
 H.B.C. as 'North-Western Territory', yet full beneficial 
 control of public domain was vested in B.C. in 1871. 
 
 6. Similarly, districts from the 'chartered' territory of 
 Rupert's Land were added both to Ontario and to Quebec, 
 with full beneficial control vested in these provinces, despite 
 so-called 'purchase' by Canada in 1870. Even within 
 boundaries of Manitoba, Ontario was granted property 
 rights over 'railway strip' to Port Nelson at the Manitoba 
 Boundaries Extension Act of 1912. 
 
 7. Manitoba, Saskatchewan and Alberta appear to be the 
 only provinces of Canada which cannot be entrusted with 
 beneficial control over either the 'licensed' or 'chartered' 
 territory of the H.B.C. ceded to Canada in 1870. 
 
 8. By the constitutional procedure scrupulously followed 
 in the transfer, therefore, both Rupert's Land and the North- 
 western Territory came to Canada not from the H.B.C. by 
 ■purchase' but from the Crown by 'Acts of State, authorised 
 by Imperial Statute' with 'all the force and permanence of 
 fundamental law.' 
 
 9. In 1871, British Columbia (see Chapter V) received 
 full beneficial control over public domain, both 'licensed' 
 area ceded in 1858 and Vancouver Island which has been 
 re-purchased from the H.B.C. in 1867 for £57,500. It is 
 submitted that Manitoba is entitled to the same fundamental 
 rights as from 1870, 'as a part of the British 
 System.' 
 
IV. 
 
 THE 'TRANSFER' AND PROVINCIAL STATUS 
 FOR MANITOBA. 
 
 The Manitoba Act of the Dominion Parliament (sub- 
 sequently confirmed by the B.N. A. Act of 1871) received the 
 vice-regal assent on May 12, 1870. It was to come into 
 effect 'On, from and after the day upon which the Queen 
 . . . shall, by Order in Council in that behalf, admit 
 Rupert's Land and the North-Western Territory into the 
 Union or Dominion of Canada';® so that Manitoba has 
 never occupied any other than provincial status in the 
 Canadian Confederation. The same Order in Council of 
 June 23, 1870, which transferred Rupert's Land from the 
 Crown to Canada on July 15 of that year thus made Manitoba 
 a Canadian province; and the British principles already 
 outlined apply here with peculiar directness and cogency to 
 the whole Canadian period of our history since 1870. 
 
 Neither the Colonial Office nor the Canadian Government 
 had contemplated the immediate establishment of provincial 
 government in Rupert's Land. Canada promised a 'liberal 
 constitution' as soon as 'the wants and requirements of the 
 Territory' should be ascertained.® Even the inhabitants at 
 Red River were not at first in favor of provincial status, 
 and in fact expressed themselves against it on the only 
 occasion when their wishes were formally consulted in the 
 matter. At the Convention of both English-speaking and 
 French at Fort Garry to meet Donald Smith, afterwards 
 Lord Strathcona, as Canadian Commissioner, Riel inquired 
 'if the Canadian Government would consent to receive them 
 as a Province' and Smith replied that 'it had not been 
 referred to when I was at Ottawa.' When the matter was 
 
 ®33 Vic, c. 3, s. 1. 
 
 ®Howe (Secretary of State for the Provinces) to McDougall, Dec. 7, 
 1869. 
 
44 Provincial Status 
 
 put to the vote, Riel's proposal was overwhelmingly defeated 
 (Feb. 4, 1870)® and the 'list of rights' which the Com- 
 missioner then proceeded to discuss was drawn up upon the 
 basis of admission as a territory. The English-speaking 
 population long remained in ignorance of the influences which 
 eventually resulted in provincial status in the Manitoba Act 
 of 1870. 
 
 The forces that resulted in the establishment of Manitoba 
 as "a Province, which shall be one of the Provinces of the 
 Dominion of Canada',® were very intimately associated with 
 the Riel Insurrection. The weight of French clerical in- 
 fluence at the Red River Settlement, supported by discerning 
 influence in Quebec, sought to safeguard special rights of 
 language, religion, schools, etc., in the West before these 
 should be swept away by the prospective deluge of immigra- 
 tion. Archbishop Tach^ of St. Boniface, on his way to Rome 
 in 1869, wrote bitterly to Sir George E. Cartier of the 
 prospective 'ruin of that which has cost us so dear': 
 
 'I have always feared the entrance of the North-West 
 'into Confederation because I have always believed that 
 'the French Catholic element would be sacrificed; but I 
 'tell you frankly that it had never occurred to me that 
 'our rights would be so quickly and so completely 
 'forgotten.'® 
 
 In Archbishop Tach^'s absence, the movement was left 
 largely in the hands of the Rev. J. N. Ritchot, of St. Norbert, 
 while preparations for actual resistance went forward beneath 
 the vainglorious leadership of Louis Riel. An Act of Parlia- 
 ment embodying special terms of union, separate schools, the 
 official use of the French language, reserves of land f6r the 
 M6tis, etc., would obviously be a more enduring safeguard 
 than the most explicit declaration of policy. Despite Riel's 
 failure to carry the Convention of February, 1870, in favor 
 of provincial status, the Manitoba Act was eventually drawn 
 
 ®New Nation, Pebraary 11, 1870. 
 
 ®33 Vic, c. 3, s. 1. 
 
 ®Vie de Mgr. Tach6, Dom Benoit, Vol. ii, p. 7. 
 
Provincial Status 45 
 
 up under circumstances which made provincial status the 
 path of least resistance for the Federal Government. The 
 rest of Canada, however, in exasperation at the deeds of a 
 few hundred M^tis in 1870 at the Red River Settlement, 
 has penalized the rest of the province for fifty years. Beyond 
 a doubt, the seizure of Fort Garry by Riel, the plundering of 
 the Hudson's Bay stores, the expulsion of the Hon. Mr. 
 McDougall from the territory, the imprisonment of Canadian 
 citizens, and finally the death of Thomas Scott, who was shot 
 in cold blood on March 4, 1870, explain much of the un- 
 discriminating bitterness of the Eastern Provinces for many 
 years against the West. With regard to the one great issue 
 upon which it will be seen all sections at the Red River 
 Settlement were in agreement — 'full control of all the public 
 land' for the 'Local Legislature' — Manitoba has paid a heavy 
 price for the Riel Insurrection. 'They wished ... to 
 have all the land within the boundary, as in other Provinces,' 
 said Sir John A. Macdonald during the debate upon the 
 Manitoba Bill: 
 
 'The land could not be handed over to them . . . 
 'It would be injudicious to have a large Province which 
 '. . . might interfere with the general policy of the 
 'Government . . . Besides the land legislation of 
 'the Province might be obstructive to immigration.' 
 
 This province alone among all the provinces of the Dominion 
 inherited an unenviable prejudice which long impeded 
 progress and deferred the recognition of the solid achieve- 
 ments of later years. It is submitted that the time has come 
 for the burial of ancient and meaningless prejudices, and for 
 the application to the administration of the public domain 
 of simple British principles which ought never to have been 
 abrogated or denied. 
 
 The Manitoba Bill was drawn up in Ottawa in consulta- 
 tion with three delegates from the Red River Settlement, the 
 Rev. J. N. Ritchot, Judge Black and Alfred Scott. The 
 negotiations, moreover, in which P6re Ritchot thus came to 
 wield prepondering influence were conducted, as it was 
 afterwards established, not upon the basis of the 'list of 
 
46 Provincial Status 
 
 rights' discussed with Commissioner Smith at the Convention 
 of February, 1870, but upon a secret list (drawn up at 
 Bishop's Palace, St. Boniface) which remained unknown to 
 the inhabitants of Manitoba for nineteen years until it was 
 published by Archbishop Tach^ during the discussion of the 
 'Manitoba School Question.'© It will be admitted that the 
 Manitoba Act as an instrument of Union was not the result — 
 as was the admission of every other province, either before or 
 since, into Confederation — of mutual legislative agreement 
 between Canada and the prospective province. Riel had 
 instructed the delegates to Ottawa to report at Red River 
 upon their mission, but both the British and Canadian 
 authorities refused to regard the Manitoba Act as 'subject to 
 confirmation by the "Provisional Government" '.© Manitoba 
 was thus unique among the provinces of the Dominion in 
 that many of the terms of Union — and particularly those 
 relating to the public domain — were imposed upon the in- 
 habitants of the new province not only without their consent 
 but even without their knowledge. 
 
 It must be admitted, moreover, that Section 30, relating 
 to the beneficial control of the public domain, was unique 
 even among the provisions of the Manitoba Act. By this 
 section (33 Vic, c. 3, s. 30) it is provided that: 
 
 'AH ungranted or waste lands in the Province shall be, 
 'from and after the said transfer, vested in the Crown, 
 'and administered by the Government of Canada for the 
 'purposes of the Dominion.' 
 
 ©Letter of Archbishop Tach6, Winnipeg Free Press, December 27, 1889; 
 Weekly Free Press, January 16, 1890. "That list was the only basis of our 
 negotiations.' Rev. J. N. Ritchot to Archbishop Tach^, January 13, 1890. 
 IM. 'Sir George Cartier told me how the Government of Ottawa was 
 embarrassed and annoyed when the delegates refused to negotiate on the 
 Bill of Rights prepared by the Convention.' (Archbishop Tache). 
 
 ©Letter of Sir Clinton Murdock, confidential representative of the 
 British Government, Ottawa, April 28, 1870: 'The condition which . . . 
 was conveyed to Judge Black and the other delegates in writing that what- 
 ever was agreed to here must be subject to confirmation by "the Provisional 
 Government" would have involved a recognition of Riel and his associates 
 and would have enabled him to postpone indefinitely the transfer of the 
 Territory.' 
 
Provincial Status 47 
 
 Unfortunately the special privileges embodied for the 
 French in the Manitoba Act, and particularly the offer of a 
 direct grant of 1,400,000 acres of land 'for the benefit of the 
 families of the half-breed residents' (33 Vic, c. 3, s. 31) were 
 inducements which speedily removed the opposition of the 
 French Mdtis to the federal control of provincial lands.® 
 No precautions were taken to safeguard in the statute even 
 the right^— as distinct from the immediate claim — to the 
 ultimate control of the land and the full beneficial interest 
 therein as from the inception of 'responsible government' and 
 provincial status in a British Dominion. 
 
 The incidents outlined above are strongly confirmed by 
 the fact that whatever considerations of national policy may 
 have actuated the Federal Government in exercising, under 
 the circumstances, temporary 'control' over the public domain 
 in 1870, the provisions in Section 30 of the Manitoba Act 
 are known to have contravened the wishes of the inhabitants 
 as indicated in every existing record of their demands at that 
 time. This is true not merely of the 'lists of rights' drawn up 
 at various times under Kiel's influence. It is conspicuously 
 true of the great mass of English-speaking as well as French 
 inhabitants of the Settlement, and this will be seen to be the 
 case by the most casual examination of the evidence upon this 
 point. 
 
 During the period from November, 1869, to April, 1870, 
 there are on record no fewer than four of these lists of rights: 
 
 ©Archbishop Tach^'s letter, Winnipeg Free Press, December 27, 1889: 
 'To condone for this refusal (of the "control of all the lands of the North- 
 west by the Local Legislature") they gave to the children of the half-breed 
 inhabitants of the country one million four hundred thousand acres of land, 
 which had not been asked for, and with the understanding that by and by 
 they would also give some lands to the parents of these children and to 
 other old settlers.' 
 
 The temporary 'control' of the public domain (as distinct from the 
 'beneficial interest' therein) by the Dominion in 1870, has been largely 
 supported both then and since. Archbishop Tach^ states that 'both the 
 Imperial (probably referring to Sir Clinton Murdock's confidential British 
 mission to Ottawa) and Canadian authorities refused to accede' to the 
 'control of all the lands of the Northwest by the Local Legislature.' Ibid. 
 
48 Provincial Status 
 
 (a) That of December 1, 1869, drawn up by Riel and 
 his followers, and showing the least insistence of all upon local 
 control over the public domain. Clauses 6 and 7 of this list 
 are as follows: 
 
 '6. That a portion of the Public Lands be appropriated 
 'to the benefit of Schools, the building of Bridges, Roads, 
 'and Public Buildings. 
 
 '7. That it be guaranteed to connect Winnipeg by Rail 
 'with the nearest line of Railway within a term of five 
 'years; the Land Grant to be subject to the Local 
 'Legislature.'® 
 
 (6) At the very representative Convention called to 
 meet Commissioner Smith at Fort Garry in February, 1870, 
 a committee was appointed to draft a 'list of rights' as a 
 basis of discussion. Two lists were drawn up: one on the 
 basis of provincial status (drawn up under Riel's influence 
 but thrown out, as already noticed, by the Convention 
 without being read or discussed), and the other on the basis 
 of territorial status. This list was discussed clause by clause, 
 and to each one Commissioner Smith replied for the Canadian 
 Government. Clause 17 reads as follows: 
 
 '17. That the Local Legislature of this Territory have 
 'full control of all the public land inside a circumference, 
 'having Upper Fort Garry as the centre, and that the 
 'radii of this circumference be the number of miles that 
 'the American line is distant from Fort Garry.' 
 
 Commissioner Smith replied in part, that 'full and sub- 
 stantial justice will be done in the matter.'® This entire list 
 must be regarded as the only one to which the inhabitants of 
 the Red River Settlement as a whole can be said to have 
 given their approval, and it is to be noticed that the demand 
 for the control of the public lands even under territorial 
 status is made in the most explicit terms. 
 
 ®Recenl Disturbances in the Red River Settlement, 1870, p. 76. 
 ®Recent Disturbances in the Red River Settlement, 1870, p. 157. 
 
Provincial Status i9 
 
 (c) The list drawn up on the basis of provincial status 
 was supplied nevertheless by Thomas Bunn as 'Secretary of 
 State' of Kiel's 'Provisional Government' to the three local 
 delegates who eventually proceeded to Ottawa, and it was 
 printed in French at the Settlement on the eve of their 
 departure. This list was erroneously considered to have 
 furnished the basis of the conference on the Manitoba Bill 
 at Ottawa and it was printed accordingly in the British blue- 
 book, Recent Disturbances in the Red River Settlement, 1870. 
 In this list clause 11 reads as follows: 
 
 '11. That the Local Legislature of the Province of 
 'Assiniboia shall have full control over all the public 
 'lands of the Province, and the right to amend all acts 
 'or arrangements made or entered into with reference to 
 'the public lands of Rupert's Land and the North-West, 
 'now called the Province of Assiniboia.'® 
 
 (d) The secret list of rights upon which Father Ritchot 
 based the discussion of the Manitoba Bill at Ottawa, and 
 containing in substance for the first time, for instance, the 
 famous 'school clause' eventually embodied in Section 22 of 
 the Manitoba Act, was drawn up secretly, as already stated, 
 at Bishop's Palace, St. Boniface, and was first published 
 eighteen years afterwards by Archbishop Tach^ during the 
 school controversy. In this list clause 11 reads as follows: 
 
 '11. That the Local Legislature of this Province shall 
 'have full control over all the lands of the Northwest.'© 
 
 It is seen, therefore, that in respect of public lands the 
 Manitoba Act contravened every formal expression of opinion, 
 both English-speaking and French, in every list of rights 
 drawn up at the Red River Settlement during the process of 
 transfer. There were undoubtedly many weighty reasons of 
 national policy for retaining federal 'control' of the public 
 domain in 1870, such for instance as a uniform policy of 
 immigration, the requirements of transcontinental com- 
 
 ®Recent Disturbances in the Red River Settlement, 1870, p. 130. 
 ©Archbishop Tach^'s Letter in the Free Press, December 27. 1889. 
 
50 Provincial Status 
 
 munications in order to bring British Columbia into Con- 
 federation, etc. Whatever may be thought of the provision 
 that the land should be 'vested in the Crown and administer- 
 ed by the Government of Canada,' however, the indefensible 
 phrase 'for the purposes of the Dominion' can never appear 
 in any other light than an unwarranted and deliberate 
 violation of the fiduciary obligations which Canada had 
 volunteered to undertake with regard to these territories 'as 
 a part of the British Colonial System' and 'in conformity 
 with the equitable principles which have uniformly governed 
 the British Crown.'. The statutory appropriation of the 
 beneficial interest as well as the control over the public 
 domain of the West was repeated in the Alberta and Sask- 
 atchewan Acts (3 & 4, Edw. vii, c. 3. s. 21 and 3 & 4, Edw. 
 vii, c. 42, s. 21, respectively) and even in the Manitoba 
 Boundaries Extension Act of 1912. This province, therefore, 
 has the unenviable distinction among the provinces of 
 Canada and the self-governing Dominions of the Empire, not 
 only of having been bom into 'colonial' subordination in 
 respect of public lands by provisions in the Manitoba Act 
 contravening every recorded expression of the demands of 
 the inhabitants of the country, but of having had the serf's 
 collar riveted, even in adult manhood, by statutory re- 
 enactment in the harshest and most uncompromising terms. 
 
 SUMMARY. 
 
 1. The Manitoba Act provided that upon transfer to 
 Canada by Imperial Order in Council, Manitoba should be 
 'one of the Provinces of the Dominion of Canada.' In the 
 case of this province, therefore, there has been no preliminary 
 period of territorial status, and British principles thus apply 
 with peculiar cogency and directness to the whole Canadian 
 period of our history since 1870. 
 
 2. The animosities of the Riel Insurrection and the 
 motives under which provincial status was sought and 
 secured in the Manitoba Act long inspired an unenviable and 
 rather undiscriminating prejudice against this province. 
 
 3. With regard particularly to the beneficial control of the 
 pubhc domain, the conduct of Riel in 1870 has penalized the 
 
Provincial Status 51 
 
 rest of the province for fifty years. 'They wished to have 
 all the lands ... as in other Provinces . . . The 
 land could not be handed over to them ... A large 
 Province . . . might interfere with the general policy of 
 the Government . . . The land legislation of the Province 
 might be obstructive to immigration.' {Sir John A. Mac- 
 donald in debate on Manitoba Bill). 
 
 4. The Manitoba Act was based on a secret 'list of rights' 
 which remained generally unknown to the inhabitants of 
 Manitoba for nineteen years. Both the British and Canadian 
 authorities refused to regard the Manitoba Act as 'subject to 
 confirmation by the "Provisional Government" which would 
 have involved a recognition of Riel and his associates.' {Sir 
 Clinton Murdoch). Manitoba was unique, therefore, among 
 the provinces of Canada in that many of the terms of union 
 — and particularly those relating to the public domain — ■ 
 were imposed upon the inhabitants of this province not only 
 without their consent but even without their knowledge. 
 
 5. Section 30 providing for the administration of 'AH 
 ungranted or waste lands ... by the Government of 
 Canada for the purposes of the Dominion' was unique even 
 among the provisions of the Manitoba Act. 'To condone for 
 this refusal' (of the 'control of all the lands of the North- 
 west') the Dominion Government 'gave to the children of 
 the half-breed inhabitants . . . one million four hundred 
 thousand acres of land, which had not been asked for.' 
 {Archbishop Tache). With this removal of opposition to 
 federal control of provincial lands, no precautions were taken 
 to safeguard for the future the territorial rights of Manitoba 
 as a British and Canadian province. 
 
 6. It is noteworthy that the provisions in the Manitoba 
 Act relating to the public domain contravened every ex- 
 pression of opinion, both English-speaking and French, in 
 every list of rights drawn up during the process of transfer. 
 'Full control of all the public land' for the 'Local Legislature' 
 had been stipulated by the Convention of February, 1870, 
 even upon the basis of territorial status. 
 
 7. "Whatever the requirements of the hour may have been, 
 therefore, with regard to the temporary 'control' of the 
 pubUc domain of the Province in 1870, the indefensible 
 phrase 'for the purposes of the Dominion' in the Manitoba 
 Act must be regarded as an unwarranted and deliberate 
 violation of fiduciary obligations on the part of the Dominion. 
 
52 Provincial Status 
 
 The repetition of this phrase in the Saskatchewan Act, the 
 Alberta Act, and even in 1912 in the Manitoba Boundaries 
 Extension Act would seem to indicate in the harshest and 
 most uncompromising terms the definite 'colonial' subordina- 
 tion of the Prairie Provinces. 
 
V. 
 
 BRITISH PRINCIPLES AND CANADIAN PRACTICE 
 IN. BRITISH COLUMBIA. 
 
 Before discussing the policy of the Federal Government 
 towards this province after 1870, it may be advisable to trace 
 the application of the fundamental British principles already 
 outlined to the cases of British Columbia and Prince Edward 
 Island. Both of these provinces entered Confederation sub- 
 sequent to the Manitoba Act. In both cases Canadian 
 practice conforms to British principles in a manner not only 
 just but generous to the new provinces. In both cases 
 provincial control of natural resources was conceded as the 
 normal right of self-governing Canadian provinces. In the 
 one case, it was conceded without even raising the issue. 
 In the other, where public lands had already been alienated 
 since the preceding century by royal grants, the Federal 
 Government undertook not only to indemnify the new 
 province by an allowance 'in lieu of the lands thus granted 
 by the Crown' under conditions for which the Canadian 
 Government was in no way responsible, but undertook by 
 public loan to enable Prince Edward Island to expropriate 
 the estates of the 'proprietors' in order to dispose of the new 
 ■public domain' thus re-acquired to resident settlers. In 
 both cases the contrast with the federal policy towards 
 Manitoba would seem to be complete. 
 
 The area which entered Confederation in 1871 as the 
 province of British Columbia comprised two districts of widely 
 varying history and development. Vancouver Island had 
 been granted, by Letters Patent of January 13, 1849, to the 
 Hudson's Bay Company, 'in free and common soccage.'® 
 
 ®' . . . Unto the said Company and their successors, the said 
 Vancouver Island, together with all Royalties of the Seas, upon the Coasts 
 within the limits therein mentioned, and aU mines Royal thereto belonging, 
 to be holden of Her said Majesty, Her Heirs and Successors, in free and 
 common soccage at the yearly rent of seven shillings.' Report on British 
 Columbia, Can. Sessional Papers, 1872, No. 5, Paper No. 10, Appendix 
 TT, p. 237. 
 
54 The Case of British Columbia 
 
 On April 3, 1867, however, it reverted by purchase to the 
 Crown. In the Letters Patent of January 13, 1849, the 
 Crown had reserved the right 'to repurchase and take from 
 the said Company, the said Vancouver Island, and premises 
 thereon granted' at the expiration of the Company's license 
 of exclusive trade with the Indians granted in 1838 for a 
 period of twenty-one years. By Indenture of April 3, 1867, 
 therefore, it is provided that: 
 
 'In consideration of the sum of fifty-seven thousand five 
 'hundred pounds, so paid by or on behalf of Her said 
 'Majesty to the said Company . . . they the said 
 'Company do for themselves and their successors by 
 'these presents, grant, convey, yield up and surrender 
 'unto Her said Majesty, Her Heirs and Successors, all 
 'that the said Island called Vancouver Island, together 
 'with all Royalties of the Seas . . . and all mines 
 'Royal, and all rights . . . and appurtenances what- 
 'soever to the said Island.' 
 
 It is to be observed that Vancouver Island, like Rupert's 
 Land, had been granted to the Company by the Crown 'in 
 free and common soccage'© and that in both cases the 
 surrender to the Crown was effected by 'the payment . . . 
 of a sum of hard money.' In the case of the surrender of 
 Vancouver Island to the British Government in 1867, how- 
 ever, the payment of £57,500 in no wise impaired the British 
 principle that 'colonists of the Anglo-Saxon race look upon 
 the land revenue as legitimately belonging to the com- 
 munity.'® Neither the control of the land nor the beneficial 
 interest therein was appropriated by the Imperial Govern- 
 ment because Vancouver Island had been 'purchased' from 
 the Hudson's Bay Company in 1867. There was no attempt 
 to indemnify the British Government for such expenditure by 
 
 ®Cf. Hudson's Bay Charter, 1670, with regard to Rupert's Land: "to 
 be holden of us, our heirs and successors ... in free and common 
 soccage . . . yielding and paying yearly to us . . . for the same, 
 two elks and two black beavers . . .' Report from the Select Committee 
 on the Hudson's Bay Company, 1857, pp. 407 et seq. 
 
 ®Colonial Office to Sir Edmtmd Head, Correspondence relating to the 
 Surrender of Rupert's Land, 1869, Appendix iii, p. 68. 
 
The Case of British Columbia 55 
 
 administering the land 'for the purposes of Great Britain.© 
 The control of the public domain and the beneficial interest 
 therein passed automatically, it will be seen, into the hands 
 of the province of British Columbia in 1871. 
 
 Meanwhile, government on the mainland was provided in 
 1858 (21 & 22 Vic, c. 99) and the name 'British Columbia- 
 was then applied to this colony. It is to be observed that 
 this whole mainland district — extended by 26 & 27 Vic, c 83 
 north to the 60th parallel of north latitude and east to the 
 Rocky Mountains and the 120th meridian of west longitude — 
 was created out of the 'licensed' area of the Hudson's Bay 
 Territories, which had previously stood in precisely the same 
 relationship to the Hudson's Bay Company as the 'North- 
 Western Territory' (as distinct from 'Rupert's Land' or the 
 'chartered' area under the Company) out of which the 
 Prairie Provinces were largely created. The British Govern- 
 ment emancipated both the 'granted' and 'licensed' areas 
 of Yancouver Island and British Columbia as a step towards 
 self-government, including the full beneficial control of the 
 public lands; whereas Canada, having acquired from the 
 Crown both the 'chartered' and 'licensed' areas of 'Rupert's 
 Land' and the 'North-Western Territory' in 1870, has parted 
 with the beneficial control only of the areas which have been 
 added to the provinces of Ontario and Quebec Those 
 within the boundaries of the Prairie Provinces have been 
 "administered by the Government of Canada for the purposes 
 of the Dominion.' The contrast is increased by the fact that 
 the final stages of 'responsible government' and beneficial 
 control of the public domain in British Columbia were 
 effected by the Dominion itself without contesting or even 
 discussing the issue. 
 
 ®Cf. Sir John A. Macdonald on the Manitoba Bill: 'By obtaining 
 control of these lands they would be able to obtain means by which they 
 would be in a position to obtain repayment of the disbursement of the 
 £300,000 for the purchase and of the expenditure which they might be 
 hereafter put to. The expense would be defrayed by that means instead of 
 being charged against the people of the Provinces of Ontario, Quebec, Nova 
 Scotia and New Brunswick. That could be done, however, only by carrying 
 out that policy of keeping the control of the lands of the country, and 
 . . . they had determined to do so.' 
 
56 The Case of British Columbia 
 
 These two districts — Vancouver Island and 'British 
 Columbia'— were united in 1866 (29 & 30, Vic, c. 67) under 
 the name of British Columbia, and this was the 'colony' 
 which entered Confederation in 1871 as the province of that 
 name. Like the Prairie Provinces, therefore, it comprised 
 one 'licensed' and one 'granted' area of the Company, and 
 the 'granted' area had been 'purchased' back by the Crown, 
 not like Rupert's Land by 'compromise' representing the 
 'cost of legal proceedings necessary ... to recover 
 possession' with a view to the appropriation of its resources 
 'for the purposes of the Dominion,' but by direct 'purchase' 
 by the Crown as a step towards self-government. British 
 Columbia is now a full province, Manitoba in respect of 
 public lands is still a 'colony' of the Dominion. 
 
 It will be remembered that 'responsible government' in 
 every case of the original provinces of Canada 'took the form 
 of a grant of full rights over the lands in exchange for a civil 
 list.'® It is noteworthy in the case of British Columbia that 
 the beneficial control of the public domain was conceded in 
 principle even before there was 'responsible' or even fully 
 representative government. In fact, there was no 'respons- 
 ible government' in British Columbia prior to entrance into 
 Confederation in 1871. This applies both to the period 
 before the union of Vancouver Island and 'British Columbia' 
 (on the mainland) into one province, of British Columbia in 
 1866, and to the subsequent period before the entrance into 
 Confederation in 1871. Even during the latter period the 
 elective element in the legislative council of the colony was 
 in a minority. About one-third of its members consisted of 
 appointed executive officials of the government, one-third of 
 magistrates from the various districts, and one-third only 
 'elected by the residents of the difEerent electoral districts.' 
 It was in clause 14 of the terms of union with Canada, in 
 fact, that provision was first made for 'the introduction of 
 responsible government when desired by the inhabitants of 
 British Columbia';® with the additional stipulation that: 
 
 ©Keith, Responsible Government in the Dominions, ii, 1047. 
 ®Can. Sessional Papers, 1871, No. 4, Paper No. 18. 
 
The Case of British Columbia 57 
 
 'it is the intention of the Governor of British Columbia, 
 'under the authority of the Secretary of State for the 
 'Colonies, to amend the existing constitution of the 
 'Legislature by providing that a majority of its Members 
 'shall be elective . . .' 
 
 This provision, as a matter of fact, was carried out only 
 by Order in Council of August 9, 1870, providing for nine 
 'elective' and six 'appointed' members; and the new legislative 
 council met for the first time only on January 5, 1871, in 
 time to accept the terms of union tentatively fixed by the 
 Governor in the previous July, and to embody those terms in 
 a formal address to the Queen as provided by the B.N. A. 
 Act of 1867, section 146. The fact here emphasized is that 
 British Columbia is entrusted with the beneficial control of 
 her lands as a Canadian province before she enjoyed even a 
 fully elective legislative council, to say nothing of 'respons- 
 ible government'; while Manitoba with all the governmental 
 machinery of full provincial status in the Manitoba Act was 
 deprived by the most explicit statutory enactment of the 
 beneficial control of her own public domain for the purposes 
 of the Province of Manitoba. 
 
 The terms of union with Canada, though widely dis- 
 cussed in British Columbia and eventually passed by a 
 legislative council predominantly elective in character, had 
 been drawn up by Governor Musgrave, who had assumed 
 office in August, 1869, under direct instructions from Downing 
 Street to carry the union. The Colonial Secretary (Lord 
 Granville) wrote to Governor Musgrave (August 14, 1869) in 
 part as follows: 
 
 'The constitution of British Columbia will oblige the 
 'Governor to enter personally upon many questions 
 '. . . with which, in the case of a negotiation between 
 'two responsible governments, he would not be bound to 
 'concern himself.'® 
 
 Now it is a very significant fact that the terms of union 
 as drawn up under these circumstances by Governor Mus- 
 
 ®Ca«. Sessional Papers, 1870, No. 5, Paper No. 31. 
 
58 The Case of British Columbia 
 
 grave and submitted to the legislative council contain no 
 specific references whatever to the public domain beyond the 
 general provisions in clause 16: 
 
 'The Provisions in "The B.N.A. Act, 1867" shall . . . 
 'be applicable to British Columbia in the same way and 
 'to the like extent as they apply to the other Provinces 
 'of the Dominion, and as if the Colony of British Colum- 
 'bia had been one of the Provinces originally united by 
 'the said Act.'® 
 
 Nor is there any specific reference to the control of the 
 public domain in the terms approved by the Canadian Privy 
 Council (July 1, 1870) beyond the repetition of the above 
 provisions in section 10 of the list there agreed upon.® 
 The full control of the public domain by the province is 
 taken for granted. The issue is neither formally discussed 
 nor even raised; nor is it even indirectly referred to except by 
 implication in clause 11 to be noted presently. This fact is 
 the more remarkable in that it was enunciated as a general 
 principle of the Canadian constitution by the Minister of 
 Justice, the Hon. Mr. Fournier, that 'Whatever right has not 
 been given to the Provinces is vested in the Dominion.'® 
 Despite the fact that the beneficial control of the public 
 domain is nowhere specifically assigned to British Columbia 
 by the terms of union, recognized British principles have 
 prevailed so naturally and so normally that the new province 
 secured the beneficial control of her public domain with the 
 first provisions for 'the introduction of responsible govern- 
 ment when desired by the inhabitants of British Columbia.'® 
 
 The principle here involved becomes very clear in clause 
 11 (above referred to) of the officially ratified terms of union. 
 This clause reads, in part, as follows: 
 
 ®Can. Sessional Papers, 1871, No. 4, Paper No. 18, p. 6. 
 
 ®Can. Sessional Papers, 1871, No. 4, Paper No. 18, p. 10. 
 
 (^Correspondence between the Federal and any of the Provincial Govern- 
 ments . . concerning the disallowance of Provincial Acts, or the action 
 on Provincial Bills Reserved. Can. Sessional Papers, 1871, No. 9, Paper 
 No. 89, p. 98. 
 
 ®Terms of union, clause 14, Can. Sessional Papers, 1871, No. 4, Paper 
 No. 18. 
 
The Case of British Columbia 59 
 
 'And the Government of British Columbia agree to 
 'convey to the Dominion Government, in trust, to be 
 'appropriated in such manner as the Dominion Govern- 
 'ment may deem advisable in furtherance of the con- 
 'struction of the said Railway, a similar extent of Public 
 'Lands along the line of Railway throughout its entire 
 'length in British Columbia, not to exceed however 
 'Twenty (20) Miles on each side of said line, as may be 
 'appropriated for the same purpose by the Dominion 
 'Government from the Public Lands in the North-West 
 'Territories and the Province of Manitoba ... In 
 'consideration of the land to be so conveyed in aid of 
 'the construction of the said Railway the Dominion 
 'Government agree to pay to British Columbia, from the 
 'date of the Union, the sum of $100,000 per annum, in 
 'half-yearly payments in advance.'® 
 
 It is worthy of notice that the railway grants are to be 
 conveyed to the Dominion Government 'in trust' and that 
 the sum of $100,000 per annum, payable in advance from the 
 date of the Union, is made 'in consideration of the land to be 
 so conveyed in aid of the construction of the said Railway,' 
 despite the fact that the building of the transcontinental 
 railway, stipulated in the same clause, was regarded then and 
 long afterwards as one of the fundamental terms of union. 
 It was ten years before the grant was made and fourteen 
 years before the railway was completed. Throughout this 
 period British Columbia received $100,000 per annum 'in 
 consideration of the land to be so conveyed'; while Manitoba 
 first extorted from the Dominion a grant 'in lieu of lands' 
 only in 1882 — twelve years after assuming the obligations of 
 self-government as a Canadian province. The grant then 
 made was $45,000 per year at a time when the Canadian 
 Government had determined to appropriate for the construc- 
 tion of the Canadian Pacific Railway 100,000,000 acres of 
 land in the West. Of this area, 25,000,000 had been already 
 granted to the Railway Company, and it was intended to 
 reimburse the Dominion for cash subsidies by the sale of the 
 remaining 75,000,000 acres. In April of that year (1882) 
 
 ©Address of Legislative Council of British Columbia, Sessional Papers, 
 Canada, 1871, No. 4, Paper No. 18, p. 25. 
 
60 The Case of British Columbia 
 
 Sir John A. Macdonald announced in the House of Commons 
 that 'not a farthing of money will have to be paid by the 
 people of Canada' for that great enterprise. 
 
 The provisions with regard to the public domain in 
 British Columbia, therefore, are what one would expect from 
 established British principles at the time. The public lands 
 pass normally and automatically to provincial control. 
 Those which are necessary 'for the purposes of the Dominion' 
 are conveyed to, and administered by, the Dominion 'in 
 trust.' The remuneration paid by the Dominion for the 
 railway lands administered in this fiduciary capacity 'for the 
 purposes of the Dominion' is a regular charge 'in half-yearly 
 payments in advance.' It is computed 'in consideration of 
 the land to be so conveyed' and as such it must be considered 
 to indicate beyond question the beneficial interest of the 
 province not only in the public domain normally within its 
 own control but in that which is administered 'in trust' by 
 the federal government 'for the purposes of the Dominion.' 
 As such it must be regarded as the interest on the capital 
 fiscal value to the province of the lands thus alienated 'in 
 trust' to Canada 'for the purposes of the Dominion.' Within 
 this category, it is submitted, must be considered the subsidy 
 'in lieu of lands' first granted to Manitoba in 1882 during the 
 projection of the C.P.R. The annual payment to British 
 Columbia was in lieu of the 'railway belt' alone, and as 
 already pointed out was made regularly from the date of the 
 Union for ten years before the land grants were actually made 
 and for fourteen years before the railway was completed. 
 It is contended that the lands alienated by the Dominion in 
 Manitoba since 1870 have been disposed of by statutory 
 enactment (33 Vic, .c. 3, s. 30) 'for the purposes of the 
 Dominion' and ought to be accounted for to this province 
 upon a fiduciary basis similar to that stipulated with regard 
 to the railway lands of British Columbia. 
 
 That province received $100,000 per annum 'in lieu of 
 lands' conveyed to Canada 'in trust' for a railway which was 
 stipulated by British Columbia as a condition of her union 
 with the Canadian Confederation. Even the Indian lands, 
 
The Case of British Columbia 61 
 
 in clause 13 of the articles of union, were to be 'conveyed 
 by the Local Government to the Dominion Government in 
 trust for the use and benefit of the Indians,' while it is 
 suggested in some quarters that Manitoba must forfeit the 
 beneficial interest in all lands hitherto alienated 'for the 
 purposes of the Dominion' — must forfeit even the present 
 inadequate annual subsidy 'in lieu of lands' — if the province 
 is to be permitted to resume control of those which still 
 remain. The case of British Columbia would seem to 
 indicate beyond question that provincial status implies the 
 same inherent rights over the public domain in the case of 
 provinces subsequently added to the Dominion as are so 
 specifically safeguarded by section 109 of the B.N. A. Act of 
 1867 for the original provinces of Confederation. 
 
 SUMMARY. 
 
 1. Vancouver Island was granted to the Hudson's Bay 
 Company by Letters Patent of January 13, 1849, and was 
 re-purchased by the Imperial Government on April 23, 1867, 
 for £57,500. 
 
 2. The beneficial control of Vancouver Island, however, 
 was not appropriated by the British Government as the 
 public domain of Manitoba was appropriated (altogether 
 without 'purchase' in that sense) by Canada 'for the purposes 
 of the Dominion.' 
 
 3. There was no attempt to indemnify the British Govern- 
 ment for the £57,500 by administering the land 'for the 
 purposes of Great Britain; while Canada 'by obtaining 
 control of these lands' (Manitoba) sought 
 
 'to obtain repayment of the disbursement of the £300,000. 
 '. . The expense would be defrayed by that means 
 
 'instead of being charged against the people of the 
 'Provinces of Ontario, Quebec, Nova Scotia, and New 
 'Brunswick. That could be done, however, only by 
 "carrying out that policy of keeping the control of the 
 'lands of the country, and . . . they had determined 
 'to do so.' (Sir John A. Macdonald). 
 
 4. The mainland colony of 'British Columbia' was created 
 (1858) from districts which had formerly been 'licensed' 
 
62 The Case of British Columbia 
 
 areas of the Hudson's Bay Company, corresponding to the 
 'North- Western Territory' of the Prairie Provinces. 
 
 5. The two districts, therefore, which were united in 1866 
 under the name of British Columbia, resembled 'Rupert's 
 Land' and the 'North-Western Territory' in having been 
 'granted' and 'licensed' territory respectively of the Hudson's 
 Bay Company. 
 
 6. It was only in clause 14 of the terms of union that 
 provision was first made for 'the introduction of responsible 
 government when- desired by the inhabitants of British 
 Columbia.' Even the Address pursuant to B.N. A. Act, 1867, 
 section 146, had to be passed by legislative council, which was 
 then for the first time predominantly elective (nine out of 
 fifteen members). 
 
 7. British Columbia thus acquired control of public 
 domain and beneficial interest therein before, having exercised 
 responsible or even fully representative government. 
 Manitoba assumed obligations of responsible government 
 fifty years ago and has been denied ever since both functions 
 with regard to the public domain. 
 
 8. Upon entering Confederation, B.C. assumed almost 
 automatically the beneficial control of public domain. The 
 issue was neither raised nor discussed nor specifically men- 
 tioned in the articles of union, and British principles thus 
 prevailed with the first provisions for 'the introduction of 
 responsible government.' 
 
 9. Even the 'railway belt' for the transcontinental railway 
 stipulated by B.C. as the price of union, was transferred to 
 Canada 'in trust' at an annual payment of $100,000. This 
 subsidy, therefore, must be regarded as the interest on the 
 capital fiscal value to the province of lands thus administered 
 'in trust' by Canada for the purposes of the Dominion. 
 
 10. Within this category, it is submitted, must be re- 
 garded the subsidy 'in lieu of lands' first granted to Manitoba 
 in 1882 during the projection of the C.P.R. The lands 
 alienated by Canada in Manitoba since 1870 have been 
 administered by statute (33 Vic, c. 3, s. 30) 'for the purposes 
 of the Dominion,' and ought to be accounted for like the 
 railway lands of British Columbia upon a similar fiduciary 
 basis. 
 
VI. 
 
 BRITISH PRINCIPLES AND CANADIAN PRACTICE 
 IN PRINCE EDWARD ISLAND. 
 
 In the case of Prince Edward Island, British principles 
 with regard to the public domain are perhaps even more 
 effectively though less directly illustrated, because the state 
 of the 'land question' in that Island in 1873 was such that 
 an almost automatic conformity, as in British Columbia, with 
 established British practice was no longer possible. It 
 became necessary to take measures of a very unusual char- 
 acter in order to idemnify the province for lands already 
 alienated before the concession of 'responsible government,' 
 and to endow the province with the domain still held by the 
 large 'proprietors.' 
 
 Practically the whole public domain of Prince Edward 
 Island had been alienated by the Crown — as BuUer reported 
 to Lord Durham, 'in one day'— to absentee proprietary 
 holders nearly a century before Confederation and long 
 before 'responsible government' with all its implications with 
 regard to the public domain had been advocated or con- 
 ceded.® With the advent of 'responsible government,' 
 therefore, the 'land question' in Prince Edward Island became 
 perhaps the most glaring example to be found in the self- 
 governing British Colonies of the iniquities of the old system 
 of control of the public domain from without in the beneficial 
 interest of those who did not themselves constitute the com- 
 munity. In fact, the Colonial Office in the negotiations with 
 the Hudson's Bay Company in March, 1864, referred, as 
 already indicated, to the case of Prince Edward. Island as a 
 warning against divorcing any British community from the 
 beneficial control of the land: 
 
 ®Lord Durham's Report, ed. Lucas, iii. 65. 
 
 Many of the proprietary grants had been ultimately made in 1768-9 
 under Lord William Campbell. See summary of titles in Selkirk Papers, 
 Vol. 74, p. 19315, etc., Dominion Archives. 
 
64 The Case of Prince Edward Island 
 
 'In an unsettled colony there is no effectual mode of 
 'taxation for purposes of government and improveijient, 
 'and the whole progress of the Colony depends on the 
 'liberal and prudent disposal of its land. These con- 
 'siderations afford decisive reasons against leaving that 
 'land in the possession of a corporation . . . 
 
 'In Prince Edward Island the right of property was 
 'more recently disjoined from that of Government, but 
 'the result has not been such as to invite imitation . . . 
 
 'It is clear that colonists of the Anglo-Saxon race look 
 'upon the land revenue as legitimately belonging to the 
 'community.'® 
 
 Of the total area of 1,390,720 acres, it was estimated in 
 1873 that 457,2403/^ acres had already been purchased by the 
 local government, with the consent of various proprietary 
 holders, in order to transfer the land to actual settlers, and 
 that 381,720 acres still remained in the hands of 'proprie- 
 tors,'® many of whom were the heirs of the original grantees 
 from the Crown. The 'land question,' therefore, like the 
 'railway question' in British Columbia, naturally constituted 
 the chief issue during the discussion of terms of union with 
 Canada, and the decision mutually agreed upon would seem 
 to indicate very clearly the principles which govern the case. 
 
 After protracted negotiations extending from 1869 to 1873 
 between the Legislature of Prince Edward Island and the 
 Dominion Government, terms of union were agreed upon on 
 March 7, 1873, at a conference between a Committee of the 
 Canadian Privy Council® and a delegation from Prince 
 Edward Island consisting of the Hon. Messrs. Haythorne and 
 Laird. These terms were adversely considered by the Island 
 Assembly in the following April, but another conference,® 
 
 ©Correspondence relating to the Surrender of Rupert's Land, 1869, 
 Appendix iii., p. 68. 
 
 ®Can. Sessional Papers, 1875, Vol. 8, Paper No. 61, pp. 10-12. The 
 Canadian Privy Council referred to 'about one-third of the Island' as being 
 'owned by absentee proprietors.' Can. Sessional Papers, 1870, Vol. 5, Paper 
 No. 31, p. 7. 
 
 OComprising the Rt. Hon. Sir John A. Macdonald, and the Hon. 
 Messrs. TiUey, Langevin, Howe and Tupper. 
 
 ©Between the Rt. Hon. Sir John A. Macdonald and the Hon. Messrs. 
 Tilley, Langevin and Tupper for Canada, and the Hon. Messrs. Pope, 
 Haviland and Howlan from P.E.I. 
 
The Case of Prince Edward Island 65 
 
 on May 15 reached an agreement which was subsequently 
 embodied (as stipulated in the B.N. A. Act, 1867, section 
 146) in Addresses of the Canadian House of Commons (May 
 20, 1873), the Canadian Senate (May 21), the Prince Edward 
 Island Legislative Council (May 28), and Assembly (May 28, 
 1873). The statutory provisions for the Union were already 
 in existence in the B.N. A. Act, 1867, section 146, and 
 pursuant to those provisions the union was effected as from 
 July 1, 1873, by an linperial Order in Council of June 26, 
 1873. In view of the confusion which appears to have 
 prevailed with regard to the public domain, it would seem to 
 be advisable to trace the inception and development of these 
 particular terms in order to distinguish clearly their true 
 import. 
 
 The first proposals embodied in a Report of the Canadian 
 Privy Council© made no provision for the 'purchase of lands 
 now held by large proprietors' beyond undertaking that the 
 Dominion should 'use their influence to secure such legislation 
 as will enable the Government of the Island to purchase the 
 land now held in large blocks, upon terms just and equitable 
 to all parties concerned.' This problem of the 'land tenure' 
 constitutes, it will be seen, one of the two distinct phases of 
 the 'land question' as eventually settled in the terms of 
 union. 
 
 The other was the 'loss of Territorial Revenue' through 
 the alienation of the public domain by the Crown without 
 regard for the beneficial interest of the province. The 
 Dominion Privy Council made the following recommendations : 
 
 'They submit that much discontent has for many years 
 'existed amongst the inhabitants of the Island, arising 
 'from the fact that the lands of the colony had been 
 'granted by the Imperial Government, in large blocks, 
 'and chiefly to persons resident abroad, thus leaving the 
 'Government of the Island no lands, the proceeds of the 
 'sale of which could, as in the other British colonies, be 
 
 ©Approved December 14, 1869, Can. Sessional Papers, 1870, Vol. 5, 
 Paper No. 31, p. 7. 
 
66 The Case of Prince Edward Island 
 
 'appropriated towards local improvements and the 
 'maintenance of Government . . . 
 
 'That up to the present time the Island Govem- 
 'ment have failed to secure a consideration in lieu of the 
 'lands thus granted by the Crown . . . 
 
 'That in the event of the Island becoming part of the 
 'Union, the Government of the Dominion will endeavour 
 'to secure for the Island, from the Imperial Government, 
 'fair compensation for the loss of Crown Lands. Should 
 'the Dominion Government fail in their efforts to secure 
 'such compensation, they will undertake to raise by loan, 
 'guaranteed by the Imperial Government, or upon their 
 'own securities, should such guarantees be refused, eight 
 'hundred thousand dollars ($800,000) and pay the same 
 'to the Island Government as a compensation for the 
 'loss of such Crown lands.'® 
 
 It is to be noted that the "consideration' proposed was 
 'in lieu of the lands thus granted by the Crown' and that this 
 payment, therefore, was to be made for lands already alienated 
 in such a way that the Island had been deprived of beneficial 
 interest therein. 
 
 These proposals of December 14, 1869, however, were 
 declined by the Island Government because they were not 
 deemed 'sufficiently liberal.'® A Committee of Council of 
 Prince Edward Island (January 7, 1870), proceeded to deal 
 with the two phases of 'the land question' already outlined: 
 
 'Inasmuch as said terms do not comprise a full and 
 'immediate settlement of the Land tenure® and in- 
 'demnity from the Imperial Government for loss of 
 'Territorial Revenue,® the Committee of Council cannot 
 'recommend said terms to the consideration of their 
 'constituents.'® 
 
 In a detailed statement subsequently issued, the Prince 
 Edward Island Council elaborated these two demands for a 
 
 ®Can. Sessional Papers, 1870, Vol. 5, Paper No. 31, p. 7. 
 
 ©Hodgson to Young, February 7, 1870, Id. p. 8. 
 
 ®Viz., the expropriation of the proprietary holdings still unalienated 
 to resident settlers. 
 
 ®Cf. the 'consideration in lieu of the lands thus granted by the Crown.' 
 Can. P.C, December 14, 1869. 
 
 ®Can. Sessional Papers, 1870, Vol. 5, Paper No. 31, p. 9. 
 
The Case of Prince Edward Island 67 
 
 'settlement of the land tenure,' and for 'indemnity . . . 
 for loss of Territorial Revenue,' and submitted that 
 
 'the offer of eight hundred thousand dollars as a free 
 I gift from the Dominion . . . would not establish 
 'this Colony in a position as regards land tenures and 
 'territorial revenues similar to that occupied by the 
 'adjoining Provinces . . .' 
 
 'The Dominion, from whom the Island has received 
 'no injury, and to whom no purchase-money or rents of 
 'land have been paid, is required to assume a duty which, 
 'clearly, is not hers.'® 
 
 The Conference of March 7, 1873, therefore, proceeded to 
 draw up terms designed as far as possible to 'establish this 
 Colony in a position as regards land tenures and territorial 
 revenues similar to that occupied by the adjoining Provinces.' 
 The terms thus adopted with regard to both these issues — 
 viz., 'Land tenure' and 'territorial revenues' — were then 
 stated practically in the form in which they received the 
 acceptance of the subsequent conference of May 15, 1873, 
 and eventually of both the Senate and Commons of Canada, 
 and the Council and Assembly of Prince Edward Island. 
 Clause 5 in the final terms of union reads as follows: 
 
 '5. That as the Government of Prince Edward Island 
 'holds no lands from the Crown, and consequently enjoys 
 'no revenue from that source for the construction and 
 'maintenance of local works, the Dominion Government 
 'shall pay by half-yearly instalments, in advance, to the 
 'Government of Prince Edward Island, forty-five thous- 
 'and dollars per annum, less interest at five per cent, per 
 'annum, upon any sum not exceeding eight hundred 
 'thousand dollars which the Dominion Government may 
 'advance to the Prince Edward Island Government for 
 'the purchase of lands now held by large proprietors.'® 
 
 It is thus seen that the Dominion, 'to whom no purchase- 
 money or rents of land have been paid' from lands already 
 alienated, agreed nevertheless to pay to the Island Govern- 
 
 ®Can Sessional Papers, 1870, Vol. 5, Paper No. 31, p. 9. 
 
 ®Statutes of Canada, 2nd Parliament, 36th Vict., 1873, xi, xiv, xv, xxi. 
 
68 The Case of Prince Edward Island 
 
 ment the sum of $45,000 per year in default of 'revenue 
 from that source ("lands from the Crown") for the con- 
 struction and maintenance of local works.' This subsidy, 
 therefore, represents a capital of $900,000 'in lieu of the lands 
 thus granted by the Crown'; and this amount exceeds by 
 $100,000 the sum originally offered by Canada and not re- 
 garded by the Island Council as 'sujfficiently liberal' in 'com- 
 pensation for the loss of such Crown Lands.' This may be 
 said to have constituted 'the indemnity for loss of Territorial 
 Revenue' as demanded by the Island Council on January 7, 
 1870. 
 
 With regard to the other demand, for a 'full and im- 
 mediate settlement of the Land tenure,' the Dominion 
 undertook as the terms of union indicate, to lend the Island 
 Government sums of money as required, not to exceed 
 1800,000, 'for the purchase of lands now held by large 
 proprietors.' The sums thus borrowed at five per cent, were 
 used in expropriating, under the provisions of the Land 
 Purchase Act of 1875® and its amendments (39 Vic, c. 5; 39 
 Vic, c 6; 39 Vic, c 7; 41 Vic, c 9) the holdings of the 
 proprietors; and the public domain thus acquired was con- 
 verted from leasehold tenures into freehold estates and dis- 
 posed of by the Land Commissioner to resident settlers upon 
 terms which produced for the province a sum in the aggregate 
 considerably in excess of the amount advanced by the 
 Dominion. The net proceeds of land sales during the twenty- 
 one year period from 1879 to 1900 alone were considerably 
 more than the entire principal — $800,000 — to be borrowed 
 from the Dominion by the terms of the union.® With 
 
 ®38 Vic, c. 32, P.E.I. Statutes, 38 Vic, 1875, p. 105. A previous Land 
 Purchase Bill (37 Vic, c. 3) drawn up by the Island Legislature with 
 provisions for compulsory sale of proprietary holdings, appointment of joint 
 commissioners, etc., had been disallowed by the Dominion Government. 
 P.E.I. Statutes, 37 Vic, 1874, p. 29. Can. Sessional Papers, 1875, Vol. 8, 
 Paper No. 61. 
 
 ®Cf. the accounts of the Commissioner of Public Lands appended to 
 the Journals of the Assembly of P.E.I, published from and after the year 
 1881. The proceeds of these sales from 1875 to 1879 — a period during which 
 the returns would be expected to be at their maximum — are not as yet 
 available on account of the fact that no journals appear to have been 
 published before 1882. 
 
The Case of Prince Edward Island 69 
 
 regard to the 'settlement of the Land tenure,' therefore, as 
 in the case of 'the indemnity for loss of Territorial Revenue,' 
 the Province of Prince Edward Island emerged in a very- 
 strong position in view of the grievous disabilities under 
 which that Colony had stood in respect of public lands. 
 
 The terms of union, therefore, comprise as the basis of 
 provincial status in respect of public lands, two distinct 
 transactions designed to 'establish this Colony in a position 
 as regards land tenures and territorial revenues, similar to 
 that occupied by the adjoining Provinces,' viz. (a) the fixed 
 subsidy of $45,000 per year as 'indemnity for loss of Territor- 
 ial Revenue,' 'in lieu of the lands thus granted by the Crown' 
 without regard to the beneficial interest of the community 
 therein and in default of 'revenue from that source for the 
 construction and maintenance of local works'; and {b) the 
 loan of $800,000 at 5 per cent, for the purchase of pro- 
 prietary lands. The annual subsidy represents the interest 
 on 'Territorial Revenue' to the capitalized fiscal value of 
 $900,000, and this subsidy was paid — and is still paid — -at a 
 uniform rate and in semi-annual payments in advance. The 
 sums loaned by the Dominion for the purchase of pro- 
 prietary holdings were advanced as required, and the lands 
 thus expropriated became automatically public domain of 
 which the Island assumed full beneficial control. In process 
 of sale to small holders this land became at once revenue- 
 producing to an extent, as already pointed out, which more 
 than counterbalanced, in the aggregate, the capital sums 
 borrowed from the Dominion. The one transaction, there- 
 fore, recognizes the retroactive beneficial interest of the 
 province in lands alienated for purposes other than those of 
 the province; the other implies beneficial control over the 
 public domain still available. Both provisions are seen to be 
 in exact conformity with the constitutional principles already 
 outlined as inherent in British self-government since the 
 concession of 'responsible government.' 
 
 It is a remarkable fact that in the case of Manitoba the 
 only obstacle to the recognition of precisely similar claims is 
 
70 The Case of Prince Edward Island 
 
 the Dominion Government itself. In the case of Prince 
 Edward Island, it was conceded that the Dominion was 
 assuming, gratuitously, obligations for which it was in no 
 way responsible: 'the Dominion, from whom the Island has 
 received no injury, and to whom no purchase-money or 
 rents of land have been paid, is required to assume a duty 
 which, clearly, is not hers.'® In the case of Manitoba, the 
 responsibility for the conditions to which this province has 
 been subjected for fifty years rests upon the Dominion 
 Government. In the case of Prince Edward Island, the 
 public domain in question had been hopelessly impaired by 
 ancient and intractable proprietary grants during the period 
 before 'responsible government,' and a century before pro- 
 vincial status was acquired. In the case of Manitoba, the 
 public domain in question has been alienated 'by the Govern- 
 ment of Canada for the purposes of the Dominion' for fifty 
 years since provincial status otherwise had been accorded in 
 the Manitoba Act. Like Prince Edward Island, Manitoba, it 
 will be seen, eventually received a subsidy from the Dominion 
 'in lieu of lands.' In the one case it was granted from the 
 very beginning of provincial status; in the other it was ex- 
 torted for the first time only twelve years after the Manitoba 
 Act. The subsidy to Manitoba began also at $45,000 per 
 annum (specified in the Order in Council of March 7, 1882,® 
 as 'the same sum that was allowed to Prince Edward Island 
 in lieu of lands') at a time when the Canadian Government 
 had determined, as already pointed out, to appropriate for 
 the Canadian Pacific Railway alone an area of 100,000,000 
 acres of western lands, more than seventy times the area of 
 the whole Province of Prince Edward Island. 
 
 With regard to the beneficial control of the public domain 
 which still remains unalienated, the contrast is not less 
 striking. The Dominion Government, which assumed obliga- 
 tions for which it was in no way responsible in providing for 
 the purchase of the proprietary estates in Prince Edward 
 
 ®P.E.I. Council, Can. Sessional Papers, 1870, Vol. 5, Paper No. 31, p. 9 
 ®Can. Sessional Papers, 1882, Vol. 10, Paper No. 82 (o). 
 
The Case of Prince Edward Island 71 
 
 Island, has not only taken no steps to put Manitoba in pos- 
 session of her natural resources but has actually been playing 
 the r61e of the proprietary grantees from the Crown in 
 administering the public domain of the province (as provided 
 in the Manitoba Act) 'for the purposes of the Dominion.' 
 
 SUMMARY 
 
 1. In Prince Edward Island, automatic conformity, as in 
 British Columbia, with British practice was no longer possible 
 because the public domain had already been granted to 
 absentee proprietors nearly a century before Confederation 
 and long before the period of 'responsible government.' 
 
 2. The Colonial Office, in fact, had urged the case of 
 Prince Edward Island against the old system of control of 
 the public domain in Rupert's Land in the beneficial interest 
 of those (H.B. Co.) who did not themselves constitute the 
 community : 
 
 'In an unsettled colony there is no effectual mode of 
 'taxation for purposes of government and improve- 
 'ment . . . 
 
 'In Prince Edward Island . . . the result has 
 not been such as to invite imitation . . . 
 
 'It is clear that colonists of the Anglo-Saxon race look 
 "upon the land revenue as legitimately belonging to the 
 'community.' 
 
 3. The 'land question,' therefore, like the 'railway 
 question' in B.C., was the chief issue in discussing terms of 
 union, and there were two distinct phases of the problem: 
 
 (a) the loss of Crown lands and consequent lack of 
 normal land revenues of British provinces 'for 
 purposes of government and improvement;' 
 
 (b) the survival of proprietary tenures. 
 
 4. The first proposals from the Canadian Privy Council 
 (December 14, 1869) with regard to these two phases of the 
 'land question' suggested: 
 
 (a) a sum of $800,000 'as a compensation for the loss of 
 such Crown Lands' ('in lieu of the lands thus granted 
 'by the Crown') 'the proceeds of the sale of which 
 'could, as in the other British colonies, be ap- 
 'propriated towards local improvements and the 
 'maintenance of Government;' 
 
72 The Case of Prince Edward Island' 
 
 (6) that the Dominion should 'use their influence to 
 'secure such legislation as will enable the Govem- 
 'ment of the Island to purchase the land now held 
 'in large blocks.' 
 
 5. These terms were not regarded by the Island Govern- 
 ment as 'sufficiently liberal' to 'establish this Colony in a 
 position as regards land tenures and territorial revenues 
 similar to that occupied by the adjoining Provinces.' Two 
 demands, therefore, were formulated (Committee of Council, 
 P.E.I., January 7, 1870): 
 
 (a) 'indemnity . . . for loss of Territorial Revenue;' 
 
 (6) 'a full and immediate settlement of the Land 
 tenure.' 
 
 6. These requirements were conceded in the terms of 
 union (March 7 and May 15, 1873) by the following provi- 
 sions : 
 
 (a) indemnity of $45,000 per annum (still paid) since 
 the Island Government had lost their Crown lands 
 and 'consequently enjoys no revenue from that 
 source for the construction and maintenance of local 
 works;' 
 
 (b) a loan from the Dominion not to exceed $800,000 at 
 5 per cent, per annum 'for the purchase of lands now 
 held by large proprietors.' 
 
 7. It is seen, therefore, that the Dominion, to whom the 
 beneficial control of the alienated lands of the Island had 
 not belonged, and to whom, therefore, 'no purchase-money or 
 rents of land have been paid' {P.E.I. Council) agreed never- 
 theless to pay P.E.I, an annual subsidy 'in lieu of the lands 
 thus granted by the Crown' and in default of 'revenue from 
 that source for . . . local works.' This subsidy repre- 
 sents a capital sum of $900,000, $100,000 in excess of that 
 originally offered by Canada (see 4 (a) above) and declined 
 by P.E.I, as not 'sufficiently liberal.' 
 
 8. With regard to the other phase of the question, the 
 'settlement of the Land tenure,' the sums advanced by the 
 Dominion enabled the Island to expropriate the proprietary 
 holdings under the terms of the Land Purchase Act of 1875 
 and its amendments. These expropriated lands became 
 automatically revenue-producing public domain, yielding 
 during the twenty-one year period 1879-1900 alone (which 
 
The Case of Prince Edward Island 73 
 
 does not include the most productive years) more than the 
 total capital sums advanced by the Dominion. 
 
 9. One transaction, therefore, implies the retroactive 
 beneficial interest of the province in lands alienated from 
 without for purposes other than those of the community; 
 the other implies the right to the beneficial control of the 
 public domain still available. Both provisions are seen to be 
 in conformity with sound British principles already outlined 
 as inherent in provincial status since the concession of 
 'responsible government.' 
 
 10. In Manitoba the only obstacle to precisely similar 
 claims is the Dominion Government itself. In P.E.I, aliena- 
 tions had been made by the Crown for over a century, and 
 long before the period of 'responsible government'; in 
 Manitoba alienations have been made for fifty years after 
 provincial status 'by the Government of Canada for the 
 purposes of the Dominion.' Even the subsidy of Manitoba 
 'in lieu of lands' was conceded ('as is done in P.E.I.' viz., 'in 
 lieu of lands thus granted by the Crown') only twelve years 
 after provincial status (1882) and after the Dominion had 
 determined to appropriate for railways alone in the West an 
 acreage seventy times the whole area of P.E.I. 
 
 11. With regard to resources hitherto unalienated, the 
 Dominion enabled P.E.I, to expropriate the lands of the 
 proprietary holders. In Manitoba the Dominion Government 
 is still playing the r61e of the proprietary grantees themselves 
 in administering the public domain by statute, 'for the 
 purposes of the Dominion.' 
 
VII. 
 
 FEDERAL POLICY AND PROVINCIAL POVERTY 
 IN MANITOBA AFTER 1870. 
 
 Between the principles already outlined for other self- 
 governing provinces and Dominions of the Empire and the 
 present claims of the Province of Manitoba lie fifty years of 
 controversy. There are many phases of this 'fight for 
 provincial rights' which are not pleasant to reflect upon. 
 Nothing perhaps is to be gained by stirring these animosities 
 at the present time. 'That this .state of affairs should 
 continue,' wrote Premier Norquay in March, 1883, 'is neither 
 fair to the Province nor creditable to the Dominion.'® One 
 thing, however, would seem to be self-evident. This particu- 
 lar issue is too fundamental — it has already played too 
 profound a part in the political development of British 
 peoples all over the world — to admit here of casual adjust- 
 ment or evasion. There must be a return to first principles, 
 and the longer the settlement is postponed the more searching 
 it is likely to be. 
 
 With regard to the general character of that settlement, 
 there would seem to be no manner of doubt. It must be 
 that which is everywhere prevalent in the other provinces of 
 the Dominion and of the British Empire. It must be based 
 upon rights implicit and inherent in provincial status. The 
 detailed application of the principles already outlined would 
 involve a searching examination of the alienations of the 
 natural resources of Manitoba since 1870 'by the Government 
 of Canada for the purposes of the Dominion.' This is 
 beyond the scope of the present inquiry, but the general 
 claims of the province may be stated in very direct and simple 
 terms. The terms are those which the present Premier of 
 Canada enunciated for the Provinces of Saskatchewan and 
 
 ©Report of Committee of Executive Council, Can. Sessional Papers, 
 1883, Vol. 12, Paper No. 108, p. 9. 
 
Federal Policy and Provincial Poverty 75 
 
 Alberta when the Acts conferring provincial status were under 
 discussion at Ottawa, viz., "exactly the same control over 
 their lands as is enjoyed by the people of the other provinces.' 
 
 'The people of the Northwest when they are granted 
 'provincial rights are fully capable of dealing with these 
 'lands . . . They are entitled to the control of these 
 'lands just as much as the people of the eastern provinces 
 'of Canada are entitled to the control of their provincial 
 'domain. I see no distinction.'® 
 
 The Province of Manitoba seeks merely the recognition of 
 full provincial status as from 1870 'when they are granted 
 provincial rights'; and it is submitted that full provincial 
 status as from 1870 involves (o) ample recognition of the 
 beneficial interest of the province in the public domain 
 already alienated 'by the Govenmient of Canada for the 
 purposes of the Dominion,' and (6) the unrestricted beneficial 
 control of all resources hitherto unalienated. 
 
 While nothing perhaps is to be gained by stirring again 
 the animosities of a generation ago, it is doubtful if anything 
 is to be gained by concealing how far the early policy of the 
 Dominion in some respects fell below standards of sound 
 statesmanship. It is not contended that a large measure of 
 federal 'control' over the public domain in 1870 was not 
 justifiable by many considerations of national policy. It is 
 contended, however, that it was less than just, and in the 
 long run less than wise, to seek to achieve these great 
 ■purposes of the Dominion' at the expense of the constitu- 
 tional rights of Manitoba. It cannot be gainsaid that in 
 order to reconcile a reluctant public opinion in the rest of 
 Canada to these great national enterprises, the Federal 
 Government construed the administration of the public 
 lands into a species of 'ownership' which was regarded as a 
 warrant to alienate them without accountability to the 
 inhabitants of this province. 
 
 There can be no doubt that this attitude was long adopted 
 by the Federal Government and is still echoed in the Eastern 
 
 ® Hansard, 1905, pp. 1462, 2929. 
 
76 Federal Policy and Provincial Poverty 
 
 Provinces in the most uncompromising form. Sir John A. 
 Macdonald in discussing the Manitoba Bill pointed out that 
 
 'it was worthy of attention how carefully the interest of 
 'the Dominion had been looked to in the reservation of 
 'all lands for all purposes . . . They (the in- 
 'habitants) wished Rupert's Land made into one Province 
 "and to have all the land within the boundary as in other 
 'Provinces. . . . The land could not be handed over 
 'to them, it was of the greatest importance to the 
 'Dominion to have possession of it, for the Pacific 
 'Railway must be built by means of the land through 
 'which it had to pass . . . They would be in a 
 'position to obtain repayment of the disbursement of 
 'the £300,000 . . . The expense would be defrayed 
 'by that means instead of being charged against the 
 'people of the Provinces of Ontario, Quebec, Nova 
 'Scotia, and New Brunswick.'® 
 
 Sir George Cartier expressed the federal policy still more 
 bluntly when he stated that the public domain in the West 
 'had been given up for nothing.'® In a Report of the Privy 
 Council for Canada, approved March 7, 1882, it is contended 
 similarly that 'the whole of Manitoba was acquired by^ the 
 Dominion by purchase from the Hudson's Bay Company 
 and thus became the property of the Dominion.'® In 
 another Report of the Privy Council of Canada, approved 
 May 30, 1884, it is stated quite unequivocally that the land 
 grants to the C.P.R. were the normal means of meeting the 
 cost of that great enterprise: 
 
 'The expenditure in construction and in cash subsidies 
 'may be regarded as an advance to be repaid from the 
 'lands.'® 
 
 ®'That could be done, however, only by carrying out that poUcy of 
 keeping the control of the lands of the country, and . . . they had 
 determined to do so.' Recent Disturbances in the Red River Settlement, 
 1870, pp. 132, 143, 146, etc. 
 
 ®'It must be in the contemplation of the Members of the House that 
 these could be used for the construction of the British Pacific Railway from 
 the East to the West.' Id. p. 139. 
 
 ®Can. Sessional Papers, 1882, Vol. 10, Paper No. 82a. 
 
 ®Can. Sessional Papers, 1885, Vol. 12, Paper No. 61. 
 
Federal Policy and Provincial Poverty 77 
 
 When the futility of the original plan of building the 
 C.P.R. 'from the lands' became obvious, the avowed policy 
 of the Dominion underwent a considerable modification. 
 Even then, however, one looks in vain for any explicit dis- 
 avowal from official quarters at Ottawa of the earlier attitude 
 of the Dominion; and long after the 'resources question' had 
 entered its second phase with the growing political import- 
 ance of the West, one looks in vain for any clear-cut conces- 
 sion of the simple British principles which lie at the root of 
 the whole matter. As late as 1905 it was contended at the 
 introduction of the Alberta and Saskatchewan Bills in the 
 House of Commons that 'these lands were bought by the 
 Dominion Government and they have remained ever since 
 the property of the Dominion Government.'® A repetition 
 of the phrases of fifty years ago is to be sought not in vain 
 among the resolutions of provincial legislatures during the 
 last twelve months. The Province of Manitoba, like the 
 nation as a whole, has moved far during the past six years; 
 and it is submitted that the use of these outworn and un- 
 fortunate phrases is no longer free from an element of danger 
 to the best interests of the Dominion. 
 
 This attitude of 'purchase,' of 'ownership,' of 'property' 
 'bought' and 'possessed,' has been reflected even in the 
 statutory provisions which have been held to validate the 
 administration of the public domain in the West as 'Dominion 
 Lands.' It is well known that for many years the very 
 statutory basis of that administration has nof gone un- 
 questioned. The Manitoba Act was a federal statute, to 
 come into force 'On, from and after the day upon which the 
 Queen ". . . under the authority of the 146th Section of 
 the British North America Act, 1867, shall by Order in 
 Council in that behalf, admit Rupert's Land and the North- 
 western Territories into the Union or Dominion of Canada.'® 
 This Act, it was subsequently found, was largely ultra vires 
 
 ©Sir Wilfrid Laurier, Hansard, 1905, p. 1431. 
 
 ®33 Vic, c. 3, s. 1. It is to be noticed that both Rupert's Land and the 
 North-Western Territory are here regarded as admitted to the Dominion 
 pursuant to the B.N. A. Act, 1867, s. 146. 
 
78 Federal Policy and Provincial Poverty 
 
 of the Federal Government — 'of more than doubtful validity,' 
 as Keith points out® — and though the chief points in doubt 
 were 'those of its provisions which gave the right to the 
 Province to have Representatives in the Senate and House 
 of Commons of the Dominion,'® the provisions in section 30 
 with regard to the 'ungranted or waste lands' have been 
 impugned both then and since.® It became necessary in 
 fact to apply to the Colonial Office for an Imperial Act 'con- 
 firming the Act of the Canadian Parliament, 33 Vic, Cap. 3 
 . . . as if it has been an Imperial statute, and legalizing 
 whatever may have been done under it according to its true 
 intent.'® 
 
 The British North America Act, 1871, was passed accord- 
 ingly, providing (section 5) that the Act for the Temporary 
 Government of Rupert's Land and the North-Western Territory 
 and the Manitoba Act 'shall be and be deemed to have been 
 valid and effectual for all purposes whatsoever from the date 
 at which they respectively received the assent, in the Queen's 
 
 ®Responsible Government in the Dominions, ii, 648. 
 
 ©Memorandum of Sir John A. Macdonald, Can. Sessional Papers, 1871 
 Vol. 6, Paper No. 20. 
 
 ®Cf. note p. 79, and also the Hon. Mr. Monk in Hansard, 1905, pp. 3072 
 et seq.: The Manitoba Act was 'ultra vires — was so considered by the legal 
 advisers of the Crown in England — and in order to make it valid it was 
 necessary to pass the Imperial Act of 1871.' 
 
 Mr. Lemieux: 'To remove doubts.' 
 
 Mr. Monk: 'That is the preamble that my honorable friend is citing. 
 'But, if he will go to the sources, he will find that there was a very strong 
 opinion in England and also here — I believe it was shared by Mr. Blake — 
 'that we had no right. It validated the section to which my honorable 
 'friend from Ottawa (Mr. Belcourt) has referred' . . . (Mr. Belcourt 
 had asked, p. 3072, 'Are we to assume then that the Manitoba Act . . . 
 'which declared the ungranted lands of that province to remain subject to 
 'the control of the Dominion Government, was ultra vires?') 
 
 'The interpretation given by the Judical Committee of the Privy 
 'Council upon section 109 . . . has always been favourable to the 
 'provinces, and has gone very far in the direction of maintaining that all 
 'public lands . . . once the province is created fell under provincial 
 'control' . . . 
 
 'By common understanding of section 109 and the interpretation put 
 'upon that section since our constitutional questions have arisen, it would 
 'seem to be evident that public lands, by the very terms of the constitution, 
 'belonged to the provinces the moment they entered confederation, and I 
 'see no reason for departing from that rule in regard to the province created 
 'out of a portion of the Northwest Territories.' 
 
 ®Lisgar to Kimberley, January 3, 1871, and Mem. of Sir John A. 
 Macdonald, Can. Sessional Papers, 1871, Vol. 5, Paper No. 20. 
 
Federal Policy and Provincial Poverty 79 
 
 name, of the Governor-General of the said Dominion of 
 Canada. '(J) And thus the administration of 'AH ungranted 
 or waste lands in the Province ... by the Government 
 of Canada for the purposes of the Dominion,' devised without 
 the consent or even the knowledge of the inhabitants of this 
 province, is blindly validated by an Imperial Act drafted in 
 Ottawa 'for all purposes whatsoever.'® It is submitted that 
 the two phrases 'for the purposes of the Dominion' and 'for 
 all purposes whatsoever,' while worthy of each other, are 
 scarcely worthy of the fiduciary obligations which Canada, 
 both before and after Confederation, volunteered to under- 
 take for Rupert's Land and its inhabitants as "part of the 
 British Colonial System' and 'in conformity with the equit- 
 able principles which have uniformly governed the British 
 Crown.' It is a very remarkable fact that section 30 of the 
 Manitoba Act, incorporated into that measure in defiance of 
 the wishes of the inhabitants of the community and validated 
 by a perfunctory carte blanche 'for all purposes whatsoever' 
 in the B.N. A. Act of 1871, should be the statutory basis 
 upon which over 18,000,000 acres of the Province of Manitoba 
 have been alienated forever from provincial control 'by the 
 Government of Canada (as provided by statute) for the 
 purposes of the Dominion.'® 
 
 ©Viz., for the Manitoba Act on May 12, 1870, more than one month 
 before the surrender of the Hudson's Bay rights in Rupert's Land had been 
 accepted by the Crown and over two months before the 'transfer' to Canada 
 came into operation. 
 
 ©For draft see Can. Sessional Papers, 1871, Vol. 5, Paper No. 20. It 
 is interesting to note that the proposed provision (section 6) that 'any Act 
 of the said Parliament hereafter establishing a Province as aforesaid shall 
 have effect as if it has been enacted by the Parliament of the United 
 Kingdom of Great Britain and Ireland' does not appear in the final Act, and 
 the omission would seem to be very significant. See note immediately 
 following. 
 
 ©There would seem to be in the view of the B.N. A. Act, 1867, em- 
 phasized by the Judical Committee of the Privy Council in the Manitoba 
 Initiative and Referendum Case (6 Geo. v, c. 59) the basis for a much more 
 searching inquiry into the legal status of the public domain in Canada and 
 particularly that part of it known as 'Dominion Lands.' Lord Haldane's 
 finding is in part as follows: 
 
 'The scheme of the Act passed in 1867 was thus, not to weld the 
 'Provinces into one, nor to subordinate Provincial Governments to a 
 'central authority, but to establish a Central Government in which 
 'these Provinces should be represented, entrusted with exclusive 
 'authority only in affairs in which they had a common interest. Subject 
 
80 Federal Policy and Provincial Poverty 
 
 The years which followed the B.N. A. Act of 1871 are 
 perhaps the most humiliating in the history of Manitoba. 
 The province struggled courageously under financial re- 
 sponsibilities which, despite an economy verging upon abject 
 parsimony, were utterly beyond the powers of the Provincial 
 Treasurer to meet from the resources at his disposal. The 
 'civil list' (such as it was) under responsible government was 
 undertaken, but there were no 'full rights over the lands in 
 exchange.' There was 'no effectual mode of taxation, for 
 purposes of government and improvement'; and though, as 
 the Colonial Office (1864) pointed out, 'the whole progress' 
 of such a community 'depends on the liberal and prudent 
 disposal of its land,' the Dominion Government had ap- 
 propriated 'for the purposes of the Dominion' not only what- 
 
 'to this each Province was to retain its independence and autonomy, 
 "and to be directly under the Crown as its head. Within these limits 
 '. . . its local Legislature, so long as the Imperial Parliament did 
 "not repeal its own Act conferring this status, was to be supreme.' 
 Law Journal Reports, Nov., 1919, p. 145. 
 
 Now the statutory basis for the transfer of 'Rupert's Land' and the 
 'North-Western Territory,' as already pointed out, was (a) the B.N. A. Act, 
 1867, section 146, and the Rupert's Land Act, section 5, in the case of 
 Rupert's Land, and (6) the B.N. A. Act, 1867, section 146, alone, for the 
 North-Westem Territory. (Cf. Sir John A. Macdonald's Memorandum to 
 the Can. P.C, Dec. 29, 1870, Sess. Papers, 1871, Vol. 5, Paper No. 20: 
 'The Rupert's Land Act provides . . . for the admission of Rupert's 
 Land (but not of the North-Westem Territory) into the Dominion of 
 Canada.') 
 
 (a) By the B.N. A. Act, 1867, section 146, the statutory authority to the 
 Queen 'to admit Rupert's Land and the North-Westem Territory, or either 
 of them, into the Union' is definitely specified as being 'subject to the 
 provisions of this Act,' viz., with full beneficial control of the public domain 
 vested exclusively not in the Dominion but in provinces enjoying 'supreme' 
 powers in that regard, 'directly under the Crown.' As Sir John A. Mac- 
 donald conceded in the memorandum above referred to: 
 
 'Even if the terms of the Address (specified in the B.N. A. Act, 1867, 
 'section 146) had included a new constitution for the North- West it 
 'must, under the above cited section, have been subject to the pro- 
 'visions of the Imperial Act of Union.' 
 (6) By the Rupert's Land Act the only statutory rights and powers trans- 
 ferred to 'the Parliament of Canada' were specified as follows: 
 
 'to make, ordain, and establish within the Land and Territory so 
 'admitted as aforesaid, all such Lav/s, Institutions, and Ordinances, 
 'and to constitute such Courts and Officers as may be necessary for the 
 'Peace, Order and good Government of Her Majesty's Subjects and 
 'others therein.' 
 
 Whatever may be thought therefore of the powers of fiduciary 'control' 
 over the public domain authorized by this section, there would seem to be 
 
Federal Policy and Provincial Poverty 81 
 
 ever 'land revenue' there was but the whole source of 
 potential revenues which ought to have been looked upon as 
 legitimately belonging to the community.' Like Prince 
 Edward Island at Confederation, the Province of Manitoba 
 was left 'holding no lands from the Crown, and consequently 
 enjoying no revenue from that source for the construction 
 and maintenance of local works'; unlike Prince Edward 
 Island, Manitoba was left for twelve years with no compensa- 
 tion whatever 'in lieu of lands.' 
 
 Immigration directed by the Federal Government was 
 proceeding with unprecedented rapidity; the settler who 
 received his homestead for nothing from the public domain 
 in Manitoba made the highest per capita contribution to 
 
 nothing in it warranting the appropriation of the 'beneficial interest' in the 
 public domain by the Federal Government. 
 
 The 'more than doubtful validity' of the Manitoba Act, therefore, has 
 been held in the opinion of many eminent jurists to apply to this phase, at 
 least, of section 30 of that Act providing that: 
 
 'AH ungranted or waste lands in the Province shall be . . . vested 
 
 'in the Crown and administered by the Government of Canada for the 
 
 'purposes of the Dominion,' 
 until, at least, the Canadian Manitoba Act, as already outlined, was regarded 
 as vaHdated 'for all purposes whatsoever' by the B. N.A. Act of 1871. 
 
 There would seem to be other consequences, however. It will be 
 remembered that by Imperial Act in 1852 (15 & 16 Vic, c. 39), 'An Act to 
 remove Doubts as to the Lands and Casual Revenues of the Crown in the 
 Colonies and Foreign Possessions of Her Majesty,' the British Parliament 
 had expressly renounced all beneficial interest 'arising from the sale or 
 other disposition of the lands of the Crown in any of Her Majesty's colonies 
 or foreign possessions,' and that this beneficial interest had passed every- 
 where to self-governing provinces under 'responsible government.' 
 
 Now the surrender of chartered rights of the Company in Rupert's 
 Land had been accepted by the Crown by Order in Council on June 22, 
 1870, and such of these rights as are specified in the Rupert's Land Act 
 were vested in the Parliament of Canada by Order in Council as from July 
 15. Those rights have universally been held to validate at least the pro- 
 visions of the Manitoba Act in creating the machinery of responsible govern- 
 ment in Manitoba. If, therefore, the provisons with regard to the 'un- 
 granted or waste lands' of the province were ultra vires of Canada in 1870 
 and void until validated by the B.N.A. Act of 1871, it would follow that 
 this province from July 15, 1870, until the B.N.A. Act of 1871, actually 
 had every constitutional and legal British right to the beneficial interest of 
 the public domain, and that by a series of usurpations culminating in the 
 carte blanche of the B. N.A. Act of 1871 those rights have been appropriated 
 by the Dominion for fifty years. 
 
 It would seem to follow from Lord Haldane's judgment also that an 
 Imperial Act restoring the public domain to Manitoba may be initiated if 
 anything more appropriately by the Provincial Legislature than by the 
 Parliament of Canada. 
 
82 Federal Policy and Provincial Poverty 
 
 Canadian customs revenues in the Dominion.® The Pro- 
 vincial Government whose right over the natural resources, 
 as Sir George Cartier remarked, 'had been given up for 
 nothing,' was expected to provide 'local works' and im- 
 provements from revenues 'not enough to pay the expenses 
 of running a respectable sea-side hotel.'® The upper 
 chamber, provided in section 10 of the Manitoba Act, was 
 abolished because the province could not afford the sessional 
 indemnity: the Dominion agreed to an additional grant of 
 3,746.96 in order to raise the total provincial subsidy to 
 ,000 ('with economies') on condition that the government 
 be 'simplified and cheapened by the abolition of the second 
 Chamber.'® The provincial government sought to shift 
 much of the burden of development to incipient municipalities, 
 and contemplated 'a resort to direct taxation for the support 
 of our provincial institutions.'® During the 'boom' of the 
 early eighties especially, it was realized that a 'great influx 
 of population' would only 'multiply the expenses of govern- 
 ment': 
 
 'A large addition to the population of the Province 
 'would be nothing short of an evil in disguise; the rapid 
 'settlement of the territory would prove anything but a 
 'blessing; to meet increasing requirements, under present 
 'circumstances, would be an impossibility, our revenue 
 'being out of all proportion to our necessary expenditure.'® 
 
 The natural resources were thus administered by the 
 Dominion in such a way as to increase the obligations of the 
 province and at the same time to deprive it of all sources of 
 
 ®An average of $10.76 per capita durii^ the ten-year period 1874-1883, 
 as compared with amounts ranging for $3.14 in Ontario, $5.16 in Quebec, 
 $4.21 in New Brunswick, $3.49 in Nova Scotia, $2.41 in P.E.I, and $10.27 
 in B.C.; 'Each Manitoban contributing twice as much as a Quebecer, 2J^ 
 times as much as a New Brunswicker, three times as much as a Nova 
 Scotian, 3}4 times as much as an Ontarian, and 4J^ times as much as a 
 Prince Edward Islander.' Memoranda by Provincial Treasurer of Manitoba, 
 1884. 
 
 ©Premier Davis. 
 
 ®Can. Sessional Papers, 1876, Vol. 8, Paper No. 36. 
 
 ®Can. Sessional Papers, 1883, Vol. 12, Paper No. 108. 
 
 ®Can. Sessional Papers, 1883, Vol. 12, Paper No. 108. 
 
Federal Policy and Provincial Poverty 83 
 
 territorial revenues. The province was being impoverished 
 in a fiscal sense by means of the public domain within its 
 own boundaries. 'The purposes of the Dominion' with 
 regard particularly to a transcontinental railway, were to be 
 effected very largely at the expense of the province: 'the 
 Pacific Railway must be built by means of the land through 
 which it had to pass.' In Prince Edward Island the Domin- 
 ion had offered to provide 'fair compensation' for the loss of 
 'lands, the proceeds of the sale of which could, as in the other 
 British Colonies, be appropriated towards local improvements 
 and the maintenance of Government.'® In Manitoba, 
 lavish land grants and a generous immigration policy produced 
 excellent results 'for the purposes of the Dominion': for ten 
 years, as already pointed out, Manitoba supplied the highest 
 per capita contribution to the federal customs revenues. 
 The whole federal policy with regard to the land, however, 
 was not in the interests of the Provincial Government. It 
 depleted the provincial treasury and subjected the province 
 to intolerable obligations. 
 
 It was under these circumstances that the Provincial 
 Government succeeded at last in obtaining froin the Dominion 
 a subsidy of $45,000 per year 'in lieu of lands' at a time 
 when Ontario was deriving $1,095,000 per annum from crown 
 lands and when the Federal Government had 'solemnly set 
 aside one hundred million acres' of Western lands for the 
 construction of the C.P.R.® The significance of this 'subsidy 
 in lieu of lands' may be discussed more appropriately perhaps 
 in the next chapter. It remains to notice here, however, 
 that the bounty of the Dominion was not such as to put an 
 end to the pilgrimages to Ottawa which had 'taken place 
 annually since the year 1872.'® Pending the consideration 
 of the claim of the province for a subsidy of $100,000 in lieu 
 of lands, the Dominion agreed to a loan of $50,000 at 5 per 
 
 ®Can. Sessional Papers, 1870, Vol. 5, Paper No. 31, p. 7. 
 
 ©Report of Committee of Can. P.C., Can. Sessional Papers, 1885, 
 Vol. 12, Paper No. 61. 
 
 ®Mem. of Del^ates of the Exec. Counc. of Man., Can Sessional 
 Papers, 1882, Vol. 10, Paper No. 82a. 
 
84 Federal Policy and Provincial Poverty 
 
 cent, to be charged to the debt account in order 'to meet the 
 immediate necessities of the Province.'® The grant eventu- 
 ally made was $45,000 per year which the Canadian Privy 
 Council were 'willing to allow to Manitoba' in 1882 'as is 
 done in P.E.I.'® This subsidy was announced by the 
 Minister of Finance as 'intended to close any negotiations on 
 that subject for the next ten years,' though, as Premier 
 Norquay pointed out, 'the term of ten years was not men- 
 tioned, either in the verbal or written negotiations on the 
 subject.'® 
 
 When the subsidy 'in lieu of lands' was increased in 1885 
 to $100,000, equal to that of British Columbia for the 'railway 
 belt,' it was made contingent upon the condition 'if such 
 proposed modified agreement is not accepted by the Legisla- 
 ture of the Province of Manitoba at its next session, as a full 
 settlement of all questions discussed, it shall become null and 
 void.'® Necessity knows no law, and even the 'disallowance 
 of railway charters,' the 'monopoly clause' of the C.P.R. 
 charter, and the other issues which embittered relationships 
 between the province and the Dominion at that time have 
 left no mark upon the political traditions of the province 
 comparable to the humiliation of the 'finality clause' of 1885. 
 The fact that the enforced element of 'finality' proved to be 
 as futile as it was humiliating in no wise mitigates an incident 
 which no citizen of Manitoba even at this date can reflect upon 
 with equanimity. In Janiiary, 1881, Premier Norquay and 
 the Hon. Mr. Girard waited patiently at Ottawa for twelve 
 days before being able to state their mission, and over a 
 month before securing even the advance of $50,000 at 5 per 
 cent, on the debt account 'to meet the immediate necessities 
 of the Province.' A cartoon in Grip represented Manitoba 
 as Oliver Twist asking for more. The bare record of the 
 
 ®Journals o} the Leg. Assembly, Manitoba, 1881, cxicv. 
 
 ®Can Sessional Papers, 1882, Vol. 10, Paper No. 82a. 
 
 ©Report of Committee of Exec. Council, Mar. 8, 1883, Can. Sessional 
 Papers, 1883, Vol. 12, Paper No. 108. 
 
 ®Pope to Norquay and Murray, Jan. 10, 1885, in Report of Can. P.C. 
 approved Jan. 23, 1885. Can. Sessional Papers, 1885, Vol. 12, Paper No. 61. 
 
Federal Policy and Provincial Poverty 85 
 
 experiences of Premier Norquay and the Speaker of the 
 Legislature during their mission at Ottawa from December 
 ^0, 1884, to January 10, 1885, when the 'finality clause' was 
 at last announced to them,© is a simple but significant 
 commentary upon the impotence of the province and its 
 subordination to the Federal Government. 
 
 SUMMARY 
 
 1. The years of controversy for 'provincial rights' after 
 1870 were 'neither fair to the Province nor creditable to the 
 Dominion' {Premier Norquay). The necessity of returning to 
 first principles would seem to be self-evident. The issue is 
 too fundamental — it has already played too profound a part 
 in the political development of British peoples all over the 
 world — to admit here of casual adjustment or evasion. 
 
 2. The only feasible settlement is that which is every- 
 where prevalent in other provinces and Dominions of the 
 Empire, viz., 'exactly the same control over their lands as is 
 enjoyed by the people of the other provinces . . When 
 they are granted provincial rights . . they are entitled 
 to the control of these lands just as much as the people of 
 the eastern provinces ... I see no distinction.' {Prem- 
 ier Borden in 1905). 
 
 3. Manitoba is thus entitled to recognition of full pro- 
 vincial status as from 1870, when it was 'granted provincial 
 rights'; and this involves (a) unrestricted beneficial control of 
 all resources hitherto unalienated, and (6) ample recognition 
 of beneficial interest in the public domain alienated 'by the 
 Government of Canada for the purposes of the Dominion.' 
 
 4. A large measure of federal 'control' was justifiable in 
 1870, in order to build C.P.R., encourage immigration, effect 
 union with B.C., etc.; but it was less than just to achieve 
 these great 'purposes of the Dominion' at the expense of the 
 constitutional rights of Manitoba. 
 
 5. It cannot be gainsaid moreover that in order to re- 
 concile a reluctant public opinion in the rest of Canada to 
 these great national enterprises, the Federal Government 
 construed the administration of the public lands into a 
 species of 'ownership' implying a warrant to alienate them 
 
 ©Report of the Delegates of the Manitoba Legislature, Journals of the 
 Leg. Assembly, Manitoba, 1885, Vol. xvi. Appendix A. 
 
86 Federal Policy and Provincial Poverty 
 
 without accountability to the province: 'The land could 
 not be handed over to them . . . The Pacific Railway 
 must be built by means of the lands through which it had to 
 pass . . . They would be in a position to obtain repay- 
 ment of the disbursement of the £300,000.' {Sir John A. 
 Macdonald). The public domain in the West 'had been given 
 up for nothing.' {Sir George C artier). 'The whole of 
 Manitoba was acquired by the Dominion by purchase . . . 
 and thus became the property of the Dominion.' {Can. 
 Privy Council). 'The expenditure in construction (of the 
 C.P.R.) and in cash subsidies may be regatded as an advance 
 to be repaid froiji the lands.' {Can. Privy Council). 
 
 6. The attitude of 'purchase,' of 'ownership,' of 'property' 
 'bought' and 'possessed' was reflected even in the statutory 
 basis of the administration of the 'Dominion Lands.' The 
 Manitoba Act was largely ultra vires of Federal Parliament — 
 'of more than doubtful validity.' {Keith). Even provisions 
 with regard to 'ungranted or waste lands' were impugned 
 both then and since until held to be validated by B.N. A. 
 Act, 1871. 
 
 7. This statute confirms Manitoba Act 'for all purposes 
 whatsoever.' The two phrases, therefore, 'for the purposes of 
 the Dominion' and 'for all purposes whatsoever,' are scarcely 
 worthy of the fiduciary obligations of the Dominion towards 
 Manitoba as 'a part of the British . . . System.' The 
 one phrase was devised without the consent or even knowledge 
 of the community directly concerned and in contravention of 
 every recorded expression of their wishes upon the subject; 
 the other was drafted at Ottawa as a perfunctory carte blanche 
 for the Federal Government. They form the statutory basis 
 upon which over 18,000,000 acres of Manitoba have been 
 alienated forever from provincial control. 
 
 8. The period after 1870 in Manitoba is not pleasant to 
 reflect upon. The province was impoverished in a fiscal 
 sense by means of the public domain within its own bound- 
 aries. In order to build the C.P.R. and encourage immigration 
 the Dominion deprived the province of all sources of 'ter- 
 ritorial revenues' at the same time as it added intolerably 
 to the obligations of the province for 'local works.' Mean- 
 while Manitoba made the highest per capita contribution in 
 Canada to federal customs revenues ($10.76 per annum for 
 1874-1883 as compared to $2.41 in P.E.I.) From a fiscal 
 standpoint 'a large addition to the population' was 'nothing 
 short of an evil in disguise.' The province was forced into 
 
Federal Policy and Provincial Poverty 87 
 
 abject parsimony. The grant of $26,746 was made on 
 condition that government be 'simplified and cheapened by 
 the abolition of the second Chamber.' 
 
 9. Subsidy of $100,000 per annum 'in lieu of lands' was 
 demanded in 1881 'in consideration of the lands within 
 Manitoba appropriated by the Dominion for the building of 
 the Canadian Pacific Railway'; pending a decision the 
 Dominion advanced $50,000 at 5 per cent, on debt account 
 to meet 'the immediate necessities of the Province.' 
 
 10. Subsidy of $45,000 was granted in 1882 'as is done in 
 P.E.I. ' and 'intended to close any negotiations on that 
 subject for the next ten years.' 
 
 11. Increased subsidy of $100,000 in 1885 was made 
 contingent upon 'finality clause' which has left a sense of 
 humiliation deeper even than 'disallowance' and 'the monop- 
 oly clause' of the C.P.R. upon^ the political traditions of the 
 province. 
 
VIII. 
 
 AMERICAN PRECEDENTS FOR A BRITISH 
 PROVINCE. 
 
 The grant of $45,000 as a 'subsidy in lieu of lands' in 
 1882 — increased to $100,000 in 1885 — has been interpreted as 
 conceding, in some degree in practice at least, the beneficial 
 interest of the province in the public domain within its 
 boundaries.® It may be advisable, therefore, to examine 
 the conditions under which these subsidies were first granted. 
 It will be found that though they were extorted from the 
 Dominion by the cogency of the cases of Prince Edward Island 
 and British Columbia, the Federal Government was un- 
 compromising with regard to the fundamental issue of pro- 
 vincial rights in the public domain, and unconcerned to the 
 point of self-contradiction even with regard to the principles 
 underlying the subsidy 'in lieu of lands.' 
 
 The rapid development of Manitoba from 1879 to 1882, 
 as already indicated, depleted a provincial treasury which 
 had already been deprived by the Dominion of all territorial 
 revenues. The free homestead system — devised 'for the 
 purposes of the Dominion'® and contributing through the 
 increased customs duties the maximum returns to Dominion 
 revenues — imposed obligations upon the local government 
 against which the province struggled in vain. Two con- 
 siderations, therefore, were undoubtedly jointly responsible 
 
 ®Cf. Sir Wilfrid Laurier to Premier Sifton, August 7, 1911: 'The 
 guiding principle in each case, except Manitoba, seems to have been that 
 the provinces were entitled to the public lands as a source of revenue to 
 administer to the growing wants of the population in each province. Nor 
 can it be said that this principle was absolutely departed from in the case 
 of Manitoba since, whilst the public lands were retained by the Dominion, 
 a larger yearly allowance out of the public treasury was granted to that 
 Province . . . and this larger grant was several times increased after- 
 wards.' 
 
 ®For the historic defence of the free homestead system see Can. 
 Sessional Papers, 1885, Vol. 12, Paper No. 61, Report of Committee of 
 Can. P.C, approved May 30, 1884. 
 
American Precedents 89 
 
 for the long agitation for 'provincial rights over the land,' 
 viz., the intolerable financial burdens for 'local works' on 
 account of the free homestead and immigration policy, and 
 the practice of lavish land grants in the interests of a trans- 
 continental railway for which 100,000,000 acres of Western 
 lands had been 'solemnly set aside.' The memorandum of 
 February 12, 1881, after pointing out the 'total inadequacy 
 of the available revenue, there being left to the Province no 
 source of local revenue, such as was enjoyed by the other 
 Provinces of the Dominion,' advanced definite claims as 
 follows : 
 
 'That in consideration of the lands within Manitoba ap- 
 ■propriated by the Dominion for the building of the 
 'Canadian Pacific Railway, Canada shall pay to the 
 'Province by half-yearly payments, in advance, the sum 
 "of $100,000.® As soon as the lands required for the 
 'Canadian Pacific shall be set apart, the residue of un- 
 ' granted land shall be handed over to the Province for 
 'the purpose of local revenue.'® 
 
 At the conference which followed the case of Prince 
 Edward Island, which had a subsidy of $45,000 'in lieu of 
 lands,' was substituted by the Minister of Finance for the 
 $100,000 suggested by the case of British Columbia. The 
 decision, however, was postponed until the following year, 
 the Dominion advancing, as already observed, a sum of 
 $50,000 at 5 per cent, on the debt account 'to meet the 
 immediate necessities of the Province.' 
 
 On March 7, 1882, a Report of the Canadian Privy 
 Council was approved by the Governor-General recommending 
 for the first time the subsidy of $45,000 per annum 'in lieu of 
 lands' : 
 
 'They are . . . willing to allow to Manitoba the 
 'same sum that was allowed to P.E.I, in lieu of lands, 
 •namely $45,000.' 
 
 ®Based upon the subsidy of the same amount to British Columbia for 
 the 'railway belt' transferred 'in trust' to the Dominion. See clause 11 in 
 the terms of union, Can. Sessional Papers, 1871, Vol. 4, Paper No. 18, p. 25. 
 
 ®Journals of the Leg. Assembly, Manitoba, 1881, Appendix, p. cxx. 
 
90 American Precedents 
 
 The refusal to concede "any change in respect to the 
 Dominion Lands lying in Manitoba' was very emphatic. 
 
 'Considering, however, the peculiar position of the 
 'Province, the Committee of Council have indicated in 
 'the previous paragraph their willingness to allow 
 'Manitoba at the rate of $45,000 a year, as is done in 
 'P.E.I. , in lieu of lands.' 
 
 There was undoubtedly more of expediency than of 
 principle in the attitude of the Federal Government at this 
 time®, but it will be noticed that the subsidy of $100,000 had 
 been demanded by the province 'in consideration of the lands 
 within Manitoba appropriated by the Dominion for the 
 building of the Canadian Pacific Railway,' viz., for lands 
 already alienated or immediately to be alienated by Canada 
 'for the purposes of the Dominion.' The grant eventually 
 made was $45,000 'as is done in P.E.I.'; and it will be 
 remembered that here also the original proposal of December 
 14, 1869, 'in lieu of lands' was offered as 'a consideration in 
 lieu of lands thus granted by the Crown,' and 'as a compensa- 
 tion for the loss of such Crown lands';® and the final subsidy 
 of $45,000 in the terms of union was specified as in default 
 of 'revenues from that source for the construction and main- 
 
 ®For an instance of the confusion, not to say heedlessness, that seems 
 to have prevailed with regard to the principles involved, and even with 
 regard to the facts of the case, see Secretary of State (Hon. Mr. Chapleau) 
 to the Lieut.-Gov. of Manitoba, April 2, 1884: 'As regards the Province 
 of P.E.I. , which had no public lands, a grant of $800,000 was made to it in 
 Ueu of the advantage which it would have had if it had owned any public 
 lands. The steps thus taken in the case of P.E.I, was repeated in dealing 
 in 1882 with Manitoba, and a sum of $900,000 or $45,000 a year granted to 
 the Province in Ueu of public lands.' Journals of the Leg. Assembly, 
 Manitoba, 1884, Vol. xv, p. 310. 
 
 There would seem to be complete confusion here between the $800,000 
 originally offered by Canada as a consideration in lieu of the lands thus 
 granted by the Crown', the $800,000 iinaUy loaned by Canada 'for the 
 purchase of lands now held by large proprietors', and the $45,000 (equiva- 
 lent to a capital sum of $900,000) finally granted as 'indemnity ... for 
 loss of Territorial Revenue.' The truth may well have been that what with 
 the C.P.R., the requirements of rapid immigration, etc., the Dominion was 
 not in a position to consider the constitutional issue on its merits. 
 
 ®A sum of $800,000, the equivalent of $40,000 per year. Can. Sessional 
 Papers, 1870, Vol. 5, Paper No. 31, p. 7. 
 
American Precedents 91 
 
 tenance of local works.'® It may be contended, therefore, 
 that both the claim to a subsidy of $100,000 per annum 'in 
 consideration of the lands within Manitoba appropriated by 
 the Dominion for the building of the Canadian Pacific Rail- 
 way,' and the grant substituted for it in 1882 by the Dominion 
 'as is done in P.E.I.' are based not upon future control of 
 'ungranted or waste lands in the Province' but upon lands 
 already alienated without regard to the beneficial interest of 
 the community. It may be observed here that the proposal 
 of the Premiers of the three Prairie Provinces (Hon. Messrs. 
 Scott, Roblin and Sifton) to Premier Borden, December 22, 
 1913, was based upon the same principle 'that the financial 
 terms already arranged between the Provinces and the 
 Dominion as compensation for lands should stand as com- 
 pensation for lands already alienated for the general benefit 
 of Canada.'® It will be necessary to refer again to this 
 proposal, but it would be stating the case moderately from 
 the standpoint of this province to say that however arbitrary 
 may have been the basis of the present subsidy as fixed in 
 1905 and 1912, such compensation is found to be far from 
 adequate for the alienations of half a century from the 
 public domain of Manitoba 'by the Government of Canada 
 for the purposes of the Dominion.' 
 
 The grant of $45,000 had scarcely been made before 
 Premier Norquay in a very able memorandum to the Execu- 
 tive Council (March 8, 1883) was forced by the intolerable 
 'financial embarrassments' of the province to undertake 'a 
 repetition of the unpleasant task of drawing ... at- 
 tention to the anomalous position which Manitoba now 
 occupies as one of the Provinces of the Dominion': 
 
 'The prospect .... precludes the possibility of her 
 'attaining that independent position as a Province which 
 
 ®Representing interest at 5 per cent upon a capital sum of $900,000 as 
 'territorial revenues' lost by royal grants. 
 
 (D'And that all lands remaining within the boundaries of the respective 
 Provinces, with all natural resources included, be transferred to the said 
 Provinces, the Provinces accepting respectively the responsibility of ad- 
 ministering the same.' 
 
92 American Precedents 
 
 'the spirit of Confederation contemplated. That is not 
 'as it should be, and there is beginning to be felt all over 
 'the Province among those who are doing their best to 
 'develop the resources of the country ... an im- 
 ' patience of being subjected to the same responsibility of 
 'Government and impositions of Customs and Excise, as 
 'are the citizens of other Provinces, whilst limited in the 
 'enjoyment of those sources of revenue allowed other 
 'members of Confederation for the prosecution of their 
 'own development . . .'® 
 
 'That this state of affairs should continue is neither 
 'fair to the Province nor creditable to the Dominion, and 
 'as the Federal Authorities are responsible for the dis- 
 ' criminating limitations and restrictions imposed upon 
 'the Province, the undersigned feels it his duty to report 
 'these facts ... for submission to the Privy Council, 
 'who, by a timely and favorable consideration of the 
 'subject, can avert consequences unpleasant to con- 
 ' template.'® 
 
 The result of a delegation to Ottawa in May, 1884, was 
 an agreement by the Federal Government that the 'swamp 
 lands' at least 'shall be transferred to the Provincial Govern- 
 ment and inure wholly to its benefit.'® With the exception 
 of the 'school lands' in which the control was vested in the 
 Dominion while the beneficial interest accrued to the province, 
 the 'swamp lands' were thus the first moiety — and remained, 
 until they reverted to the Dominion in 1912, the only moiety 
 — of the public domain in Manitoba in which British practices 
 have ever obtained; and even here the precedent, it will be 
 seen, was not British but American. 
 
 This utterly inadequate concession, however, was met by a 
 vigorous protest (June 2, 1884): 
 
 'The proposal that this Province shall become possessed 
 'of only the swamp lands, together with the grant of 
 '$45,000 a year, is not acceptable to this Legislature as 
 
 ®'And this feeling is intensified by the fact that the population of 
 'Manitoba is largely composed of settlers from the older Provinces who 
 'have been ' accustomed to enjoy all the franchises guaranteed Provincial 
 'Legislatures by the full application of the B.N.A. Act.' 
 
 ®Can. Sessional Papers, 1883, Vol. 12, Paper No. 108. 
 
 ®Can. Sessional Papers, 1885, Vol. 12, Paper No. 61. 
 
American Precedents 93 
 
 'a compensation of the equitable claim that this Province 
 'has always preferred to all the lands thereof.'® 
 
 The humiliating result of the conference of December 20, 
 1884 — January 10, 1885, has already been indicated. Premier 
 Norquay was confronted at Ottawa with a bill of federal 
 expenditures in the West 'from the cost of the expeditionary 
 force down to the latest return of the surveys, as well as of 
 moneys granted in annuities to the Indians.' The delegation 
 in despair reverted to the proposal of 1881 'that the Dominion 
 pay the Province annually the sum of $100,000 in lieu of 
 lands'; and the 'finality clause,' already outlined, completed 
 the discomfiture of the province in its miserably ineffectual 
 attempt to secure from the Dominion Government 'payment 
 for the lands already disposed of by them within the Province' 
 and the 'control, management and sale of the Public Lands 
 within its limits, for the public uses thereof.'® 
 
 The granting of the 'subsidy in lieu of lands' was inter- 
 preted, it has been seen, even by Sir Wilfrid Laurier, as proof 
 that the 'guiding principle'® of Confederation with regard to 
 the public domain was 'not absolutely departed from in the 
 case of Manitoba.'® It is apparent, however, that though 
 this may have been true with regard particularly to the lands 
 already premanently alienated from provincial control, the 
 principles at the root of the whole issue were by no means 
 conceded. Even the transfer in 1884 of the 'swamp lands' to 
 the province 'to inure wholly to its benefit' was based, like 
 
 ® Journals of the Leg. Assembly, Manitoba, 1885, Vol. xvi. Appendix A. 
 
 Cf. Can. Sessional Papers, 1883, Vol. 12, Paper No. 108: 'During the 
 'recent elections which took place in the Province, the question of the 
 'acquisition of the Public Lands was fully discussed at the polls. The 
 'unanimous opinion of the electors was that the Province should be placed 
 'on the same footing ... as are the other Provinces of Canada . . . 
 'irrespective of the policy pursued by the U.S. towards their territories 
 .when admitted into the Union.' 
 
 ©Address to Governor-General, June 2, 1884, Journals of the Leg. 
 Assembly, Manitoba, 1885, VoL xvi. 
 
 ®'That the provinces were entitled to the public lands as a source of 
 'revenue to administer to the growing wants of the population.' Sir Wilfrid 
 Laurier to Hon. A. L. Sifton, August 7, 1911. 
 
 ®Ibid. 
 
94 American Precedents 
 
 the 'school lands,' upon American rather than British pre- 
 cedent. In fact, there were no precedents at that time, either 
 within Canada or without, for the ruthless appropriation of 
 all the natural resources of the West 'for the purposes of the 
 Dominion'; and the Federal Government met the demand 
 'that the residue of ungranted land shall be handed over to 
 the Province for the purpose of local revenue'® by what must 
 be regarded as one of the most astonishing avowals in Can- 
 adian constitutional history. 
 
 A Report of a Committee of the Canadian Privy Council, 
 approved March 7, 1882, reads in part as follows: 
 
 'The analogy which the delegates see between lands in 
 'other Provinces and those in Manitoba does not seem 
 ~ 'to the Committee of Council to be well drawn inasmuch 
 'as the other Provinces owned their land before Con- 
 'federation and brought them into the Union with them 
 "as their own property; whereas, the whole of Manitoba 
 "was acquired by the Dominion by purchase from the 
 'the Hudson's Bay Company, and thus became the 
 'property of the Dominion, and stands really, as it 
 'seems to the Committee of Council, in the same position 
 "as lands in the Territories of the United States, which 
 'are not given to new States as these new States are 
 'created, but remain the property of the United States.'® 
 
 Similarly the well-known Report of the Committee of the 
 Canadian Privy Council, approved May 30, 1884, and quoted 
 rather more frequently, it is only fair to add, in that genera- 
 tion than in this: 
 
 'The lands of Manitoba held a very different position, in 
 'relation to the Dominion Government, from the lands 
 'of the other provinces. Shortly after the union of the 
 'old provinces, the Government formed from that union 
 'purchased at a large price in cash® all the rights, title 
 'and interest of the Hudson Bay Company, in and to the 
 'territory out of which the Province of Manitoba has 
 'been formed; it incurred, further, a very large ex- 
 
 ®Journals of the Leg. Assembly, Manitoba, 1881, Appendix, cxx. 
 ®Can. Sessional Papers, 1882, Vol. 10, Paper No. 82a. 
 ®For the 'large price in cash', see Chapter III., p. 35. 
 
American Precedents 95 
 
 'penditure to obtain and hold this territory in peaceable 
 'possession,® and at a still further cost which is continu- 
 'ous and perpetual, in extinguishing Indian titles and 
 'maintaining the Indians,® so that the Dominion Govern- 
 'ment has a very large pecuniary interest in the soil . . 
 
 'It was urged by the delegates that the Canadian 
 'Pacific Railway is being constructed in fulfilment of the 
 'terms of union with British Columbia . . . Parlia- 
 'ment would not have gone beyond the original propo- 
 'sition of a waggon road had the Dominion Government 
 'not been the owner, by purchase, of a large territory, 
 'which would be . . . largely contributory to the 
 'cost . . . 
 
 'In 1880 Parliament solemnly set aside one hundred 
 'million acres of those lands towards meeting the cost of 
 'the work ... It was not to be expected that the 
 'lands could be made available to meet a cash expenditure 
 'until some time after railway connection was had with 
 'and through them; and therefore, the expenditure in 
 'construction and in cash subsidy, may be regarded as an 
 'advance, to be repaid from the lands . . . 
 
 'The attention of the Sub-Committee has been 
 'directed to the procedure of the Federal Government of 
 'the United States, in the organization of new States, 
 'and they find that it rigidly retains the public lands of 
 'the State except those it may appropriate for specific 
 'purposes, allotting to the State only swamp lands®. . . 
 
 'The Sub-Committee submit that it is expedient to 
 ~ 'recommend to Parliament a modification of this arrange- 
 'ment . . .'® 
 
 It will not be necessary to trace here in detail this applica- 
 tion of American precedent — on the whole defended by 
 
 ®By the same argument, Canada would seem to have a "very large 
 pecuniary interest in the soil' of Belgium. 
 
 ®Cf. Address of House of Commons and Senate, December 16 and 17, 
 1867: 'The claims of the Indian tribes to compensation for lands required 
 for purposes of settlement wiU be considered and settled in conformity with 
 the equitable principles which have uniformly governed the British Crown.' 
 Oliver, Canadian North-West, ii, 946. 
 
 In B.C. 'the charge of the Indians' was assumed by the Dominion by 
 section 13 of the terms of union. 
 
 ®For the inaccuracy of statement and of the analogy see below. 
 
 ®Can. Sessional Papers, 1885, Vol. 12, Paper No. 61. 
 
96 American Precedents 
 
 federal administrations both Conservative and Liberal until 
 1911 — though one of the last, and least reserved, avowals of 
 it was made upon a very memorable occasion as late, it will 
 be seen, as 1905, at the introduction of the Alberta and 
 Saskatchewan Bills. An examination even of the American 
 system, however, would seem to indicate that as a state 
 within the American Union, Manitoba would probably have 
 received full title and sovereign ownership of every acre of 
 the public lands within her boundaries. 
 
 Between the states of the American Union and the 
 provinces of the Canadian Confederation there is at the out- 
 set a fundamental difference which would seem to go very 
 far towards destroying the whole basis of comparison. As 
 already indicated, the title to the public domain in the 
 British Empire is 'vested in the Crown', and 'the Crown is 
 one and indivisible throughout the Empire.' The only 
 functions with regard to public lands exercised and enjoyed by 
 any province or Dominion, even by the Parliament of Great 
 Britain itself, are the administration of the same and the 
 beneficial interest therein. Now when the thirteen American 
 colonies secured their independence, each state became the 
 'successor to the Crown and colony in the ownership of the 
 unappropriated and vacant lands within her limits, and 
 to the land rights of the Crown.'© By the terms of the 
 Treaty, the Crown of Great Britain recognized the United 
 States as 
 
 'free sovereign and independent States, and that he 
 'treats with them as such, and for himself, his heirs, and 
 'successors relinquishes all claims to the government, 
 'proprietary and territorial rights of the same, and every 
 'part thereof.' 
 
 Full title and ownership, therefore, vested in the in- 
 dividual states of the Union. The unappropriated lands were 
 their 'property' in a sense which has no parallel within the 
 British Empire. Whether the Dominion of Canada was a 
 
 ®The Public Domain, Its History, with Statistics, 46th Congress, 3rd 
 Session, Executive Document 47, Part 4, p. 33, etc. 
 
American Precedents 97 
 
 landed entity at all by the B.N. A. Act of 1867, in view of the 
 principles so clearly enunciated by Lord Haldane in the 
 recent Manitoba Initiative and Referendum Case®; whether 
 the Dominion as such was vested with landed rights by the 
 provisions of the Rupert's Land Act; whether the Federal 
 Parliament had, or in fact has, powers to grant provincial 
 status and antonomy by virtue of the B.N. A. Act, 1871, 
 section 2, in accordance with any other provisions in respect 
 of public lands than those of the B.N. A. Act of 1867;® 
 whether section 21 in the Alberta and Saskatchewan Acts 
 providing for the administration of the crown lands 'by the 
 Government of Canada for the purposes of Canada' could be 
 shown by a test case before the Judicial Committee of the 
 Privy Council to have been ultra vires of the Federal Govern- 
 ment; these are purely legal questions upon which there may 
 be difference of opinion. With regard, however, to the con- 
 stitutional principles involved — the political as distinct from 
 the purely statutory or legal 'rights' of the case — there would 
 seem to be no question whatsoever. The 'ownership' and 
 'title' of 'ungranted or waste lands' is 'vested in the Crown', 
 and the process of divesting the Crown of the beneficial control 
 of the public lands is just a part of the larger process of 
 devolution which has transformed Britain from a true 
 monarchy to a democracy. The only point at issue would 
 seem to be how far that devolution of beneficial control over 
 the 'ungranted' and 'waste lands' of the Crown has gone or 
 ought to go; and by precedent which has obtained throughout 
 the self-governing provinces of the British Empire, it is 
 submitted that the beneficial interest, at any rate, in the 
 public domain cannot rest short of self-governing provinces 
 under responsible government.® Whatever may be the 
 purely statutory or legal powers of the Dominion, therefore. 
 
 OLaw Journal Reports, Nov., 1919, pp. 142 et seq. 
 
 ©'Subject to the provisions of this Act.' B. N.A. Act, 1867, section 146. 
 
 ®Cf. Sir Robert Borden, 1905: 'He (Sir Wilfrid Laurier) said it might 
 interfere with the operation of the policy of the government with respect to 
 immigration. So far as the rest of his argument is concerned, it would have 
 justified the retention by the Imperial Government up to the present time 
 of every acre of Crown Lands in Canada.' Hansard, 1905, p. 1462. 
 
98 American Precedents 
 
 in respect of public lands (apart altogether'^from the means 
 taken in the case of Manitoba to acquire and exercise those 
 powers) these must be regarded by their very nature (if 
 permissible at all) as fiduciary in character for self-governing 
 provinces until the full beneficial control is vested where it 
 must ultimately belong. 
 
 The original states of the American Union, therefore, 
 'owned' their public lands© in 1783 and could dispose of them 
 as they chose, untrammelled by the constitutional procedure 
 which afterwards came to prevail in the British Empire. In 
 view of the fact, however, that the area ceded by Great 
 Britain included some 400,000 square miles of disputed 
 territory beyond the original boundaries of the thirteen 
 states, there arose a conflict of claims for the hinterland until 
 the various states concerned agreed to cede the disputed 
 territory to the National Govenunent. The nucleus of the 
 ■'public domain' of the United States, therefore, originated in 
 the cession, by a sort of 'self-denying ordinance', to the 
 National Government, with full sovereign title, of over 400,000 
 square miles of territory by the States of New York, Virginia, 
 Massachusetts, Connecticut, South Carolina, North Carolina 
 and Georgia.® It is seen, therefore, that the 'cession' of 
 Rupert's Land and the North-Western Territory to Canada 
 by the Crown more than three-quarters of a century later 
 conveys a vastly different import, for the whole theory and 
 practice of responsible government in British provinces had 
 been evolved in the meantime®; and it is not on record in 
 any case that the original provinces of Canada have ever 
 contemplated self-denying ordinances in order to constitute, 
 
 ®'In the United States we have adopted a fundamental principle of the 
 English law, derived from the maxims of the feudal tenure, that "the King 
 (State) is the original proprietor or lord paramount of all the land in the 
 Kingdom, and the true and only source of title." ' The Public Domain, 
 46th Congress, 3rd Session, Executive Doctunent 47, Pari; 4, p. 158. 
 
 ©Ranging in date from 1781 to 1802. Virginia alone ceded 265,562 
 square miles. 
 
 ®'Acts of State, authorised by Imperial Statute', with 'all the force and 
 permanence of ftmdamental law'. Canadian delegates, March 18, 1869, 
 Correspondence relating to the Surrender of Rupert's Land, 1869, p. 44. 
 
American Precedents 99 
 
 by generous cessions of territory, the areas known under the 
 Act of 1872 as 'Dominion Lands.' 
 
 Now it is an interesting fact that even here American 
 precedent would seem to support the claims of Manitoba. 
 Out of this 'public domain' (in the American sense) as pro- 
 vided by cession from seven of the states of the Union, many 
 states were created without previous territorial status such as 
 obtained in many of the districts afterwards purchased by 
 the National Government from other sovereign powers. In 
 the case of these 'Legislative States', as they were called 
 (Kentucky, Vermont, Tennessee, Maine, West Virginia, etc.), 
 admission to the Union carried with it not merely beneficial 
 control but full title and sovereignty over the public lands 
 within their boundaries. In fact this is the case even with 
 regard to Texas, which was annexed in 1845. West Virginia 
 came into the Union with fuU title to public lands as late as 
 1862. It will be remembered that Manitoba came into the 
 Canadian Confederation with provincial organization in 
 1870 and without previous territorial status under the 
 Dominion. The same Order in Council which effected the 
 transfer of this district from the Crown made of it a Canadian 
 province; and as already pointed out, British (not to say 
 American) principles apply here with peculiar directness and 
 cogency to the whole Canadian period of our history since 
 1870. 
 
 In addition to this 'ceded' national "public domain' in the 
 United States, however, the National Government secured at 
 various times by purchase, conquest or treaty, a vast area 
 of nearly 2,500,000 square miles at a total cost of over 
 $88,000,000. These areas were organized with territorial 
 status, and from these territories states were subsequently 
 created and admitted to the Union. It became a practice for 
 the National Government in the constitution of these 'Land 
 States,' as they came to be called, to retain control of the 
 'public domain', after making special grants, however, of 
 school lands, university lands, swamp lands, etc., to the state. 
 It is not difficult to recognize in the 'school lands' of Manitoba, 
 railway land grants, 'swamp lands' (granted to the province in 
 
100 American Precedents 
 
 1884 and reverting to the Federal Government in 1912), and 
 in many details of administration, survey, etc., the results of 
 American example; but one looks in vain for such provisions 
 as the State Selection Act, 1841, by which 500,000 acres for 
 the purposes of 'internal improvements' were granted 'to 
 each State that shall hereafter be admitted into the Union.'® 
 By the time that American precedents were first avowed by 
 the Dominion with regard to Manitoba, no fewer than 
 seventeen states had received 7,800,000 acres in this way. 
 Measures like the United States Distribution Act®, the 
 'Canal Wagon and Railroad Grants' to various states of the 
 Union, the 'Two, Three and Five per cent. Funds' upon the 
 'net proceeds of the sales of public lands' allowed to many 
 states 'from the date of admission into the Union,' are not in 
 evidence in the case of Manitoba.® It was twelve years after 
 attaining provincial status before this province found the 
 Federal Government "willing to allow to Manitoba' the sum 
 of $45,000 a year, 'as is done in P.E.I.,' in lieu of lands.® 
 
 Despite the fact that American precedent was more con- 
 venient in 1884 than it would now appear to be convincing, 
 the policy then enunciated passed currency with Federal 
 Governments at Ottawa for twenty-five years, though not 
 without protest, both federal and provincial, in favor of 
 sounder principles of British procedure. It is necessary in 
 the interests of historical fact to observe that the American 
 
 ©Executive Documents, 46th Congress, 3rd Session, Vol. 25, p. 129, etc. 
 
 ®0f 1841, by which 90 per cent, of 'all the net proceeds of the sales 
 of public lands in all the States subsequent to December 31, 1841, were to 
 be divided pro rata among the twenty-six States and the Territories of 
 Wisconsin, Iowa, and Florida, and the District of Columbia, according to 
 respective Federal population.' The Public Domain, 46th Congress, 3rd 
 Session, Executive Document 47, Part 4, p. 256. 
 
 ®The Public Domain, 46th Congress, 3d Session, Executive Document 
 47, Part 4, p. 256, etc. 
 
 Cf. Report of Committee of Can. P.C., May 30, 1884: 'The attention 
 'of the Sub-Committee has been directed to the procedure of the Federal 
 'Government of the United States, in the organization of new States, and 
 'they find that it rigidly retains the public lands of the State except those 
 'it may appropriate for specific purposes, allotting to the State only swamp 
 'lands which, when drained become a source of profit.' Can. Sessional 
 Papers, 1885, Vol. 12, Paper No. 61. 
 
 ®Can. Sessional Papers, 1882, Vol. 10, Paper No. 82a. 
 
American Precedents 101 
 
 system, or rather the perversion of it avowed by the Canadian 
 Privy Council, 1880-84, received perhaps its most unqualified 
 endorsation for this generation at the introduction of the 
 Alberta and Saskatchewan Bills in 1905: 
 
 'This is a case in which we can go to the United States 
 'for precedents. They are situated very much as we are 
 'regarding the ownership of lands and the establishment 
 'of new states. Whenever a new state has been created 
 'in the American Union, the Federal Government has 
 'always retained the ownership and management of the 
 'public lands . . .'® 
 
 Beyond a doubt the requirements of the situation in 1905 
 were very difficult, and sections 20 and 21® of the Alberta 
 and Saskatchewan Acts were advocated, and eventually 
 drafted, as offering 'the soundest argument with which to 
 appeal both to the people of the new provinces and to the 
 people of the older provinces.' The same may perhaps be 
 said of the Manitoba Boundaries Extension Act of 1912, when 
 this province was placed upon an equal footing with the two 
 other Prairie Provinces with regard to area and 'subsidy in 
 lieu of lands.'® The fact remains, however, that the basis 
 of the subsidy 'in lieu of public lands' in 1905 was necessarily 
 more or less arbitrary, and the Premiers of the three Prairie 
 Provinces (Hon. Messrs. Sifton, Scott and Roblin) in 
 December, 1913, in the attempt to reach a common basis for 
 the perplexing differences of status and development between 
 the three provinces concerned, were forced into a position 
 
 ®'We know that when Manitoba was brought into the Dominion, that 
 'province was not given the ownership of her lands . . . Her application 
 'was always met in the same way. It was always met by the statement that 
 'it was impossible to grant her request. The matter was finally closed in 
 '1884 when the Government of Sir John Macdonald . . . gave very 
 •forcibly and clearly the reasons why the prayer of that province could not 
 'be entertained.' Sir Wilfrid Laxmer, Hansard, 1905, p. 1431. 
 
 ©Providing for the subsidy 'in lieu of public lands' and for the ad- 
 ministration of 'AH Crown lands, mines and minerals and royalties incident 
 thereto ... by the Government of Canada for the purpose^ of Canada.' 
 
 O'The legislation was intended to place Manitoba on a basis of equality 
 'with Saskatchewan and Alberta. So far as I can comprehend the situation 
 'it did not mean more than this.' Sir Robert Borden to Premier Scott, 
 January 9, 1913. 
 
102 American Precedents 
 
 which has been completely misunderstood and misinterpreted 
 by other provinces of Canada as a proposal to 'retain the 
 money and get the lands into the bargain': 
 
 'that the financial terms already arranged between the 
 'Provinces and the Dominion as compensation for lands 
 'should stand as compensation for lands already 
 'alienated for the general benefit of Canada, and 
 'that all lands remaining within the boundaries of the 
 'respective Provinces, with all natural resources included, 
 'be transferred to the said Provinces.'® 
 
 It must be emphatically repeated at this point that the 
 subsidy in lieu of lands in Manitoba was first demanded for 
 lands already alienated ('in consideration of the lands within 
 Manitoba appropriated by the Dominion for the building of 
 the Canadian Pacific Railway'); that it was conceded 'as is 
 done in P.E.I.'; and that from the standpoint of this province 
 the present subsidy will be found to be an altogether 
 inadequate compensation for the resources alienated during 
 the past fifty years 'by the Government of Canada for the 
 purposes of the Dominion.' It will be sufficient here to 
 remark that the proceeds of the railway and Hudson's Bay 
 land sales alone (December 31, 1917) had reached the total 
 of $178,000,000 from the grants made to them from the 
 public domain of the West, and that over 14,500,000 acres 
 still remained to be disposed of. For practical purposes, 
 therefore, the historic claims of this province might be 
 formulated in less general terms as: 
 
 (a) the unrestricted beneficial control of all public lands 
 and natural resources within the boundaries of the 
 province hitherto unalienated; 
 
 (b) compensation at a fixed equitable rate per acre® 
 for all lands within Manitoba alienated to the Hudson's 
 
 ©Premiers Scott, Roblin and Sifton to Premier Borden, December 22. 
 1913. 
 
 ®The futility of any method of determining equitable 'compensation' by- 
 balancing Dominion receipts and expenditures from 'Dominion Lands' is 
 obvious, since in the case of practically all the chief alienations the lands 
 have been granted free, while 'the purposes of the Dominion' are attained 
 indirectly in other ways. Cf. railway land grants and free homesteads, and 
 the high per capita customs revenues from new settlers. 
 
American Precedents 103 
 
 Bay Company at the transfer, and under section 30 of 
 the Manitoba Act 'by the Government of Canada for the 
 purposes of the Dominion' ; such compensation to be made 
 by way of annual payments at 5 per cent., and to be 
 reckoned as from the date of alienation, less the amounts 
 received as subsidies in lieu of lands. 
 
 SUMMARY 
 
 1. Two considerations were chiefly responsible for the 
 agitation for 'provincial rights over the land', viz., the in- 
 tolerable financial burdens for 'local works' on account of the 
 free homestead and immigration policy of the Dominion, and 
 the practice of lavish grants for railways. 
 
 2. Claims of Manitoba (Memorandum, Feb. 12, 1881) 
 were advanced (o) that a subsidy of $100,000 (the same as in 
 B.C.) be granted 'in consideration of the lands within 
 Manitoba appropriated by the Dominion for the building of 
 the Canadian Pacific Railway', (6) that 'the residue of un- 
 granted land shall be handed over to the Province for the 
 purpose of local revenue.' 
 
 3. The case of P.E.I. ($45,000) was substituted by the 
 Dominion for that of B.C. ($100,000), and the grant was 
 eventually made (1882) 'as is done in P.E.I.' {Report of 
 Committee of Can. P.C.) It may be contended, therefore, 
 that both the original claim 'in consideration of the lands 
 within Manitoba appropriated . . . for the building of 
 the Canadian Pacific Railway' and the grant substituted for 
 it 'as is done in P.E.I.', are based not upon future control of 
 'ungranted or waste lands in the Province' but upon lands 
 already permanently alienated without regard to the benefi- 
 cial interest of the community. (Cf . the proposals of Dec. 22, 
 1913, 'that the financial terms already arranged ... as 
 compensation for lands should stand as compensation for 
 lands already alienated for the general benefit of Canada.') 
 
 4. 'Swamp lands' were transferred to the province in 
 1884, but the subsidy of $100,000 in lieu of lands in 1885 was 
 made contingent upon the 'finality clause'. This completed 
 the discomfiture of the province in the attempt to secure 
 'payment for the lands already disposed of . . . within 
 the Province' and the 'control, management and sale of the 
 Public Lands within its limits, for the public uses thereof.' 
 
 5. The 'subsidy in lieu of lands' was interpreted even by 
 Sir Wilfrid Laurier as proof that the 'guiding principle' of 
 
104 American Precedents 
 
 Confederation in respect of lands was 'not absolutely de- 
 parted from in the case of Manitoba.' The principles at the 
 root of the whole matter, however, were not conceded, and 
 the Dominion met the demand 'that the residue of ungranted 
 land shall be handed over to the Province for the purpose of 
 local revenue' by one of the most astonishing avowals in 
 Canadian constitutional history. 
 
 6. 'The whole of Manitoba was acquired ... by 
 purchase . . . and thus became the property of the 
 Dominion, and stands really ... in the same position 
 as lands in the Territories of the United States, which are not 
 given to new States . . . but remain the property of the 
 United States.' (Report of Committee on P.C., approved 
 March 7, 1882). 
 
 7. 'The Government . . . purchased at a large price 
 'in cash, all the rights ... in and to the territory out 
 'of which the Province of Manitoba has been formed; it 
 'incurred, further, a very large expenditure to obtain and 
 'hold this territory in peaceable possession, and ... in 
 'extinguishing Indian titles and maintaining the Indians, so 
 'that the Dominion Government has a very large pecuniary 
 'interest in the soil . . . 
 
 'The expenditure in construction (C.P.R.) and in cash 
 "subsidy, may be regarded as an advance, to be repaid from 
 'the lands . . . 
 
 'It ("the Federal Government of the United States") 
 'rigidly retains the public lands of the State except those it 
 'may appropriate for specific purposes, allotting to the 
 'State only swamp lands . . . 
 
 'It is expedient to recommend to Parliament a modification 
 'of this arrangement . . .' (Report of Committee oj P.C., 
 approved May 30, 1884). 
 
 8. This avowal of American precedent was defended by 
 federal administrations both Conservative and Liberal until 
 1911, though even under the American system the evidence 
 would seem to support the claims of Manitoba. 
 
 9. A fundamental difference exists between the British 
 and American systems. In the British Empire title to all 
 public domain is 'vested in the Crown'; and whatever may 
 be the difference of opinion with regard to purely statutory 
 or legal rights of the Dominion, the constitutional or political 
 rights of the Province to the beneficial interest in the public 
 domain and ultimate control thereof would seem to be un- 
 impeachable. Statutory powers of the Dominion, therefore 
 
American Precedents 105 
 
 (altogether apart from the way these were acquired), must 
 be regarded as fiduciary in character and intermediary, under 
 responsible government, between the Crown and self-govern- 
 ing provinces where full beneficial control must ultimately 
 be vested. 
 
 10. In the United States, each separate state became, at 
 independence, the 'successor to the Crown and colony in the 
 ownership of the unappropriated and vacant lands' in a way 
 which has no parallel in the British Empire. 
 
 11. The nucleus of the national 'public domain' of the 
 United States originated in cessions to the National Govern- 
 ment with full sovereign title, of over 400,000 square miles 
 of hinterland by seven of the thirteen states. It is not on 
 record that the other provinces of Canada have ceded terri- 
 tory to form 'Dominion Lands.' 
 
 12. The States (Maine, Vermont, Tennessee, West 
 Virginia, Kentucky, etc.) organized without previous ter- 
 ritorial status out of this ceded 'public domain' received full 
 sovereign title and ownership of the lands within their 
 boundaries. Manitoba came into Confederation as a province 
 without previous territorial status, and her territory had been 
 'ceded' by the Crown by 'Acts of State, authorised by 
 Imperial Statute', with 'all the force and permanence of 
 fundamental law', long after the principles of responsible 
 government with all its implications had been everywhere 
 conceded. 
 
 13. Even Texas, annexed in 1845, received as a state 
 without previous territorial status, the full title to public 
 lands; and though the districts from the 'Louisiana purchase,' 
 etc., were organized after varying periods of territorial status 
 into 'Land States', with the public domain still vested in the 
 National Government, measures like the State Selection Act, 
 the Distribution Act, the 'Canal Wagon and Railroad Grants' 
 to various states, the 'Two, Three and Five per cent. Funds', 
 etc., are not in evidence under the American system as 
 applied by the Dominion to Manitoba. The U.S. Govern- 
 ment was represented {Committee of P.C., May 30, 1884) as 
 'allotting to the State only swamp lands.' Even these were 
 taken away from Manitoba in 1912. 
 
 14. Unreserved avowals of American principles were made 
 as late as 1905, at the Alberta and Saskatchewan Bills: 'This 
 is a case in which we can go to the United States for pre- 
 cedents . . . Whenever a new state has been created in 
 the American Union, the Federal Government has always 
 
106 ' American Precedents 
 
 retained the ownership and management of the public lands.' 
 {Sir Wilfrid Laurier). 
 
 15. Basis of subsidy in 1905 and 1912 was more or less 
 arbitrary, but the proposal of December 22, 1913 (present 
 subsidy as 'compensation for lands already alienated') was 
 occasioned by the necessity of reaching a common basis for 
 the perplexing differences of status and development between 
 the three provinces concerned. 
 
 16. Manitoba's original 'subsidy in lieu of lands' was 'in 
 consideration of lands within Manitoba appropriated by the 
 Dominion for the building of the Canadian Pacific Railway'; 
 and even the present subsidy is altogether inadequate for 
 resources alienated for fifty years 'for the purposes of the 
 Dominion.' Railway and H.B. Co. land sales alone (Dec. 31, 
 1917) amounted to $178,000,000, and there are 14,500,000 
 acres left. 
 
 17. Claims of Manitoba may thus be stated in less 
 general terms as: 
 
 (a) Unrestricted beneficial control of all public lands and 
 natural resources hitherto unalienated. 
 
 (6) Compensation at a fixed equitable rate per acre 
 for all lands within Manitoba alienated to the H.B.C. at the 
 transfer, and under section 30 of the Manitoba Act 'by the 
 Government of Canada for the purposes of the Dominion'; 
 such compensation to be made by way of annual payments at 
 5 per cent., and to be reckoned as from the date of alienation, 
 less the amounts received as subsidies in lieu of lands. 
 
 18. The balancing of Dominion receipts and expenditures 
 from Dominion lands is obviously a futile method of determin- 
 ing equitable 'compensation.' Chief alienations have been 
 free grants, 'the purposes of the Dominion' being attained 
 indirectly in other ways. Cf. railway land grants and free 
 homesteads, and the high per capita customs revenues from 
 new settlers. 
 
IX. 
 
 BRITISH PRINCIPLES IN THE ASCENDANT: 
 PROVINCE OR COLONY? 
 
 The half-century of conflict for 'provincial rights' in Mani- 
 toba and the ascendancy of sound British principles at Ottawa 
 are counterparts of the only process which would seem to offer 
 promise of settlement of the 'Natural Resources Question.' 
 With regard to the first, the name of Premier Norquay will 
 always hold a conspicuous — and as the first native premier of 
 the province perhaps a pre-eminent — place. The memoranda 
 drawn up by him in his 'fight for provincial rights' may be 
 classed among the important state papers of the Dominion. 
 Based not upon reasoned constitutionalism but upon the 
 practical requirements of the case, the insistent demands for 
 'payment for the lands already disposed of . . . within 
 the Province,' and the 'control, management and sale of the 
 Public Lands within its limits, for the public uses thereof,'® 
 are in a sense very typical of that unerring practical political 
 instinct among British peoples which raised the whole ques- 
 tion of responsible government in the first place and applied 
 the principles then vindicated to all the self-governing prov- 
 inces and Dominions of the Empire. 
 
 Premier Norquay's long contest with Ottawa closed like 
 his own sturdy career in his native province, in a courageous 
 but ineffectual attempt to cope with conditions that were too 
 strong for him or perhaps for any man. For the counterpart 
 of Premier Norquay's work, it is necessary to look to sound 
 constitutionalism at Ottawa; and the outstanding name in 
 this respect is beyond doubt that of Sir Robert Borden himself. 
 It will not be necessary to trace in detail the gradual emanci- 
 pation of federal policy from the tangle of opportunism and 
 necessity which so long prevailed during the formative period 
 
 ©Address to Governor-General, June 2, 1884, Journals of the Leg. As- 
 sembly, Manitoba, 1885, Vol. xvi. 
 
108 Province or Colony? 
 
 of Canadian history after Confederation. The problems which 
 confronted the builders of the Dominion were perhaps as for- 
 midable as any which have ever been surmounted in such a 
 cause, and it would be altogether less than just to disparage in 
 any way the massiveness of their conceptions or their courage 
 in achievement. Beyond a doubt, however, the expedients 
 that were found to be necessary were heroic in more senses 
 than one, and as Lincoln once said with regard to the American 
 Civil War, constitutional principles must be regarded as having 
 had 'a rough time of it.' The hour is now more propitious. 
 The sound and discerning constitutionalism which has guided 
 our national destinies abroad would appear to be the only line 
 of policy which is capable of solving the anomalies of Confedera- 
 tion at home. It is altogether fitting and proper — indeed 
 there are very specific reasons why it would appear to be 
 necessary® — that these two processes should be consummated 
 at the same time. 
 
 The ascendancy of British principles up to the Conference 
 of November, 1918, must be traced very briefly: as briefly at 
 least as it may be deemed advisable in default of the publica- 
 tion of the documents upon the subject. 
 
 At the introduction of the Alberta and Saskatchewan Bills 
 in 1905, Sir Robert Borden, then leader of the opposition, de- 
 fined the constitutional principles involved by advocating, as 
 
 ®Thie reversion of the natural resources of Manitoba to the province 
 would seem to require an Imperial Act to amend the B.N. A. Act of 1871. 
 Perhaps ^his may possibly be true also with regard to Alberta and Saskatche- 
 wan, by the terms of the B. N.A. Act of 1871, section 6; though Sir Robert 
 Borden would seem to regard a federal Act 'with the consent of the Provincial 
 legislature' as suiEci^t. Hansard, 1905, p. 1466. 
 
 Cf. also the 'Halifax platform' of 1907: 'The restitution of the public 
 lands to the Provinces of Alberta and Saskatchewan upon fair terms.' (Mani- 
 toba not included.) 
 
 In view of this fact the recent proposal to secure for the Dominion, 
 powers to amend the B.N.A. Act 'with the consent of the Provincial Legisla- 
 tures' could scarcely be acquiesced in by the Prairie Provinces — ^by Manitoba 
 at any rate — without insisting upon the full settlement of the historic claims of 
 this province first. Any other course would seem (pace the attitude of the 
 other provinces at the Conference of November, 1918) to invite the postpone- 
 ment of the settlement of the 'Natural Resources Question' for this province 
 to the Greek Calends. 
 
Province or Colony? 109 
 
 already noted, 'exactly the same control over their land as 
 is enjoyed by the people of the other provinces' : 
 
 'He (Sir Wilfrid Laurier) said it might interfere with the 
 "operation of the policy of the government with respect to 
 'immigration. So far as the rest of his argument is con- 
 'cemed, it would have justified the retention by the 
 'Imperial government up to the present time of every acre 
 'of Crown Lands in Canada ..." 
 
 With regard to Durham's recommendation in 1839 for 
 Imperial control of crown lands in the interests of an Imperial 
 policy of colonization : 
 
 'It was soon found . . . that it was absolutely im- 
 'practicable — that to the people living in and developing 
 'any dependency must be entrusted, and might be safely 
 'entrusted, the entire control of the public lands . . .' 
 
 'So far as the control ,of the lands is concerned, I adhere 
 'to the opinion I before expressed in this House: that the 
 ■people of the northwest when they are granted provincial 
 'rights . . . are entitled to the control of these lands 
 'just as much as the people of the eastern provinces of 
 'Canada are entitled to the control of their provincial 
 'domain. I see no distinction.'® 
 
 It is well known that Sir Robert Borden advocated in 1907© 
 'the restitution of the public lands to the provinces of Alberta 
 and Saskatchewan upon fair terms.' Manitoba admittedly 
 presented, and still presents, many exceptional features: in 
 the fact that there was no previous territorial status, in the 
 exceptionally long period of 'responsible government' without 
 'full rights over the land in return,' in the comparatively limited 
 resources now available to' the province in any case after the 
 lavish alienations of half a century, and in the statutory reduc- 
 tion of the province to 'colonial' status by Imperial Act drafted 
 from Ottawa 'for all purposes whatsoever.' In a very closely- 
 reasoned statement in Winnipeg, however, in June, 1911, Sir 
 Robert Borden expressed the opinion that all three Prairie 
 Provinces were entitled to the 'just recognition of their un- 
 
 ® Hansard, 1905, pp. 1462, 2929. 
 ©'Halifax platform.' 
 
110 Proyince or Colony? 
 
 doubted rights to their public lands and natural resources'®; 
 though as Premier of the Dominion, two years later, Sir Robert 
 Borden pointed out that even in the cases of Alberta and 
 Saskatchewan, there were already (February 24, 1914) serious 
 complications which had 'now to be surmounted': 
 
 'If the course which we then (1905) advocated had been 
 'carried out . . . the difficulties which have now to 
 'be surmounted before those natural resources can be 
 'transferred to the western provinces would not present 
 'themselves to Parliament and the Government to-day. '@ 
 
 A conference which had taken place at Ottawa during the 
 previous October had resulted in the submission of the well- 
 known proposal of December 22, 1913, by the three western 
 Premiers, Hon. Messrs. Sifton, Scott and Roblin: 
 
 'that the financial terms already arranged between the 
 'provinces and the Dominion as compensation for lands 
 'should stand as compensation for lands already alienated 
 'for the general benefit of Canada, and that all lands 
 'remaining within the boundaries of the respective Pro- 
 'vinces, with all natural resources included, be transferred 
 'to the said Provinces.' 
 
 During the correspondence which ensued it was pointed 
 out by Premier Borden that several important topics dis- 
 cussed at the Conference had not been touched upon in the 
 
 ®'To-day in Canada six provinces enjoy the right to control and ad- 
 'minister the public lands, mines, minerals, and other natural resources within 
 'their boundaries. That right is not enjoyed by the three Prairie Provinces 
 . . . The Public Lands and Natural Resources are vested in the Crown, 
 'to "be administered for the benefit of the people. In six Provinces the Crown 
 'in dealing with the PubUc Domain, acts upon the advice of the Provincial 
 'Ministers, and under the laws enacted by the Provincial Legislattu'es. In the 
 'three Prairie Provinces the Cro^ in dealing with such lands acts upon the 
 'advice of the Federal Ministers and under laws enacted by the Federal 
 'Parliament. 
 
 'Why should there be any such discrimination against the people of these 
 Provinces?' Winnipeg Telegram, Jtme 20, 1911. 
 
 ® Hansard, 1914, Vol. ii, p. 1069. 
 
Province or Colony? Ill 
 
 formal proposal of December 22, 1913®; while the provincial 
 Premiers defended their emphasis upon the financial terms 
 upon the grounds that that proposal had been 
 
 'based upon the two fundamental principles which were 
 'enunciated by yourself in explaining your policy on this 
 ■question in Western Canada and which were discussed 
 'at the interview — first, the right of the provinces to the 
 'ownership of the public domain, and second, their right 
 'to compensation for such portions of the same as have 
 'been alienated for the general benefit of Canada.'© 
 
 Premier Borden's reply, dated March 10, 1916, re-affirmed 
 the necessity of including other 'fundamental aspects of the 
 subject' in the discussion, and concluded by observing that: 
 
 'With respect to these considerations the conditions in 
 'the three Provinces are possibly not altogether similar; 
 'and each of the three Provinces is entitled to have its 
 'point of view considered . . .' 
 
 Without over-emphasizing here either the obvious diffi- 
 culties of reaching a uniform, as distinct from an ultimately 
 equitable, basis of settlement for the three provinces concerned, 
 or the advantages which may be found (even from the stand- 
 point of ultimate fiscal equality) by an adherence to the 'first 
 principles' outlined in this memorandum, the remaining course 
 
 ®'At your interview with me on the 29th of October last, the following 
 'among other considerations were discussed in connection with the proposed 
 'transfer: 
 
 '1. The readjustment of the financial terms which under the Alberta 
 'Act and the Saskatchewan Act and under the Act of 1912 extending the 
 'boundaries of Manitoba were accorded to the respective Provinces in 
 'lieu of natural resources and in compensation therefor. 
 
 '2. An arrangement with the respective Provinces by which the present 
 'provisions with respect to homesteading could be retained in force. 
 
 '3. Other stipulations which might be regarded as necessary or desirable 
 'for the ptffpose of assuring conditions that would not militate against 
 'a continued flow of desirable immigration. 
 
 'Your letter (Dec. 22, 1913) alludes only to the first of the three subjects then 
 'briefly discussed . . .' Premier Borden to Premiers Roblin, Scott and 
 Sifton, March 6, 1914. 
 
 ©Premiers Scott, Sifton and Norris to Premier Borden, Nov. 30, 1915. 
 
112 Province or Colony? 
 
 of negotiations to the present time may be outlined very 
 briefly. 
 
 With the exception of an interchange of letters in the 
 spring of 1916 with regard to the 'school lands,' the 'Resources 
 Question' was naturally lost to sight in the issues raised by the 
 war. It was not until November, 1918, that a further Con- 
 ference was arranged at Ottawa for the consideration of the 
 whole question. The Federal Government, however, in the 
 absence of Sir Robert Borden, placed the matter before a 
 'Conference of representatives of all the provinces of Canada' 
 with an intimation that 
 
 'the Government was disposed to give favourable con- 
 'sideration to the request for the transfer of the natural 
 'resources, and it was also intimated that the request for 
 'the continuance of the subsidy being paid to the Provinces 
 'in lieu of their lands would not be opposed, provided that 
 'it was mutually satisfactory to the other Provinces of 
 'the Dominion. ' 
 
 The immediate result of the conference was a resolution 
 by the representatives of all but the Prairie Provinces, to the 
 following effect : 
 
 'Whereas the representatives of the Government of Can- 
 'ada have intimated to the Conference that they consider 
 'favorably the request of the provinces of Manitoba, 
 'Saskatchewan and Alberta, that the ungranted or waste 
 'lands and other natural resources within their limits, now 
 'vested in His Majesty in the right of Canada, be trans- 
 'ferred to His Majesty in the right of the said provinces 
 'under certain conditions and restrictions — be it therefore 
 
 'Resolved that the representatives of the following 
 'provinces; namely: Ontario, Quebec, Nova Scotia, New 
 'Brunswick, Prince Edward Island, and British Columbia 
 'desire to put themselves on record as declaring that in 
 'the event of the special allowances in lieu of lands 
 'provided for by the Acts of Parliament 4-5 Ed. vii, 
 'cc. 3 and 42© and 2 Geo. v, cc. 32, 40 and 45© 
 'being maintained in whole or in part, a proportionate 
 
 ®Alberta Act, 1905, and Saskatchewan Act, 1905. 
 
 ®Manitoba Boundaries Extension Act, 1912, Ontario Boundaries Exten- 
 sion Act, 1912, and Quebec Boundaries Extension Act, 1912. 
 
Province or Colony? 113 
 
 'allowance calculated on the basis indicated in the 
 'said Acts be granted to each of the other provinces 
 'of Confederation — reserving however any special claim 
 'on the part of any province in respect of the pro- 
 'posed transfer or arising out of the Acts of Par- 
 'liament 35 Vict., c. 23® and 2 Geo. v. cc. 32, 40 and 
 '45®, or upon any other ground whatsoever; and the 
 'representatives of the Maritime Provinces asserting their 
 'right to have their special claims referred to herein ad- 
 'justed at the same time as the lands and natural resources 
 'are transferred to the Provinces of Manitoba, Saskatche- 
 'wan and Alberta.' 
 
 It may thus be said that pending the return of negotiations 
 to normal federal channels, the 'Natural Resources Question' 
 has now been consigned to the limbo of undetermined causes 
 whence all the supplications of the Prairie Provinces for years 
 to come would be powerless to effect deliverance. 
 
 It remains, before concluding, to consider briefly two 
 fragmentary features of the 'Natural Resources Question' 
 which would seem to call for special consideration. 
 
 In connection with the proposed return of the public domain 
 to the Prairie Provinces there have been suggestions of 'certain 
 reservations'® which would appear to require a very clear-cut 
 declaration of principle if the status of the Prairie Provinces 
 within the Dominion is not to remain still very seriously 
 impaired. 
 
 During the debate on the Alberta and Saskatchewan Bills 
 in 1905, Sir Robert Borden in advocating 'exactly the same 
 control over their lands as is enjoyed by the people of the other 
 provinces,' suggested that: 
 
 'it would be the task of good statemanship to have inserted 
 'if necessary, a provision in this Bill with regard to free 
 
 ®The Dominion Lands Act, 1872, providing for 'school lands,' etc. 
 
 ©Manitoba Boundaries Extension Act, 1912, Ontario Boundaries Exten- 
 sion Act, 1912, and Quebec Boundaries Extension Act, 1912. 
 
 ®Premiers Norris, Martin and Stewart to Sir Thomas White, Nov. 19, 
 1918. 
 
114 Province or Colony? 
 
 'homesteads and the prices of those lands, and obtain to 
 'it the consent of the people of the Northwest Territories.'© 
 
 Similarly in Sir Robert Borden's reply to the original pro- 
 posal of Western Premiers on December 22, 1913, two 'aspects 
 of the subject' under consideration are outlined as follows: 
 
 '2. An arrangement with the respective Provinces 
 'by which provisions with respect to homesteading should 
 'be retained in force or other suitable provfsions assured. 
 
 '3. Such additional stipulations as might be con- 
 "sidered necessary or desirable for the purpose of ensuring 
 "conditions that would not militate against a continued 
 'flow of desirable immigration.'® 
 
 Now the resolution from the representatives of the other 
 provinces of Canada at the Conference of November, 1918, 
 refers to the proposed transfer of the natural resources to 
 provincial control as favoured by the Dominion 'under certain 
 conditions and restrictions,' and it is submitted that arbitrary 
 'conditions and restrictions' with regard to the public lands 
 would amount, as Sir Robert Borden himself suggested in 
 1905, to a concession of 'the principle that the government do 
 not intend to hand them over.'® Instead of the province 
 being 'supreme' over its own public domain, 'directly under the 
 Crown as its head,'® the Dominion would still be exercising 
 in Manitoba a 'suzerainty' which if applied to other provinces 
 of Canada would be regarded as intolerable. Instead of 
 becoming a full province of the Dominion, Manitoba would 
 still remain a colony ; with powers, it is true, somewhat enlarged 
 in practice but with status almost as far removed as ever from 
 the 'first principles' of responsible government and the British 
 North America Act of 1867. 
 
 For there would seem to be no more fundamental principle 
 in connection with the whole development of local control 
 
 ®'The lands ought to be handed over, but if we are to concede the prin- 
 ciple that the government do not intend to hand them over, then in that case 
 the best thing to do was that which I suggested.' Hansard, 1906, p. 5337. 
 
 ®Sir Robert Borden to Premiers Norris, Scott and Sifton, March 10, 1916. 
 
 ® Hansard, 1905, p. 5337. See note® above. 
 
 ®Lord Haldane, as already noted, in the Manitoba Initiative and Refer- 
 endum Case. 
 
Province or Colony? 115 
 
 over the public domain than the fact that the primary pur- 
 poses of that local control were fiscal. It will not be necessary 
 to repeat in detail the evidence upon this point. In 1864 the 
 Colonial Office pointed out that 'Colonists of the Anglo-Saxon 
 race look upon the land revenue as legitimately belonging to 
 the community.'® The Canadian Privy Council itself de- 
 plored the plight of Prince Edward Island in having 'no lands, 
 the proceeds of the sale of which could, as in other British 
 Colonies, be appropriated towards local improvements and 
 the maintenance of Government.'® The subsidy of $45,000 
 in Prince Edward Island 'in lieu of lands' was granted because 
 the province 'enjoys no revenue from that source for the con- 
 struction and maintenance of local works.'® The 'grant of 
 full rights over the lands' was everywhere made, as Keith 
 points out, 'in return for a civil list'®: a community which re- 
 lieves the Crown of the expenses and obligations of govern- 
 ment must be entrusted with the normal resources of the 
 Crown for that purpose. These instances, taken at random 
 from the evidence already adduced in other connections, could 
 be multiplied if necessary from other sources. As Sir Wilfrid 
 Laurier pointed out in 1911, 'the guiding principle' in Con- 
 federation with regard to the pubUc domain was 'that the 
 provinces were entitled to the public lands as a source of 
 revenue to administer to the growing wants of the population 
 in each Province.'® 
 
 These normal functions of the public domain 'for the pur- 
 poses of local revenue' have remained for fifty years in Mani- 
 toba latent in the unconceded but 'undoubted rights' of the 
 province to its 'public lands and natural resources.' In fact 
 these have been so long latent that the rest of Canada seems 
 almost instinctively to regard them as vested interests of the 
 Dominion.- It is a remarkable fact that while 'school lands' 
 
 (T) Correspondence relating to the Surrender of Rupert's Land, 1869, Appendix 
 iii, p. 68. 
 
 ®Can. Sessional Papers, 1870, Vol. 5, Paper No. 31, p. 7. 
 ©Clause 5 in the terms of union. 
 ®Responsible Government in the Dominions, ii, 1047. 
 ®Sir Wilfrid Laurier to Hon. A. L. Sifton, Aug. 7, 1911. 
 
116 Province or Colony? 
 
 are supposed to yield revenues for education, and 'swamp 
 lands' (from 1884 to 1912) 'when drained,' as the Canadian 
 Privy Council pointed out, 'are fit for settlement and very valu- 
 able,' the most valuable lands of all which are 'immediately 
 fit for settlement and tillage, and likely to be sought by immi- 
 grants'® must still be alienated in free homesteads by Canada 
 'for the purposes of the Dominion.' 
 
 It may be said without much uncertainty that 'the potency 
 of these observations in favor of a continuance of such a policy 
 has passed away.'® It would be out of place here to discuss 
 the advantages or disadvantages of the homestead policy ot the 
 Dominion; though a very profound modification of opinion 
 with regard to the whole system in both Canada and the 
 United States would not seem to be improbable when all the 
 facts connected with it come to be impartially appraised. It 
 is submitted, however, that some of the richest soil in North 
 America must be regarded as a fiscal asset of the first magni- 
 tude to the province; and if in addition to the vast areas already 
 permanently alienated from provincial control, that which 
 remains and which ought to be within the beneficial control of 
 the province 'for the purpose of local revenue' is still to be 
 administered 'for the purposes of the Dominion,' the province 
 is entitled to adequate fiscal compensation and to statutory 
 safeguards which will leave full provincial status absolutely 
 unimpaired. This is a case where a return to first principles 
 would seem to be imperative. Free lands producing no 
 revenues, rapid immigration producing educational and social 
 problems of the first magnitude — these from the standpoint 
 of the province are the 'seamy side' of Dominion policy which 
 it must be 'the task of good statesmanship,' as Sir Robert 
 Borden has observed, to forestall and alleviate. 
 
 The other feature of the 'Natural Resources Question' which 
 invites comment is of equal moment, though it is more difficult 
 perhaps, to discuss it with equanimity. The reference of the 
 
 ©Sir Wilfrid Laurier to Hon. A. L. Sifton, Aug. 7, 1911. 
 
 ©Hon. A. L. Sifton to Sir Wilfrid Laurier, March 20, 1911, with reference 
 to the historic defence of the free homestead system, etc., in the Order in 
 Council of May 20, 1884. 
 
Province or Colony? 117 
 
 'Natural Resources Question' to a 'Conference of representa- 
 tives of all the Provinces' in a purely provincial capacity- 
 would seem to leave the fiduciary obligations of the Dominion 
 in administering the public domain of the Prairie Provinces to 
 be determined by the other provinces of Canada on the basis 
 of their own fiscal expediency. Acquiescence on the part of 
 the Premiers of the Prairie Provinces would "virtually establish 
 an admission on our part that the other Provinces have a 
 right to share in the beneficial interest in our public domain.© 
 
 It is possible that much of the hostility to the historic 
 claims of Manitoba to full 'provincial rights for provincial 
 status' has arisen from a misconception of the nature of pro- 
 vincial claims and even of the basis of past and existing sub- 
 sidies 'in lieu of lands.' The resolution of 1918, already 
 quoted, would seem to be particularly unfortunate in this 
 respect. The transfer of the natural resources hitherto un- 
 alienated 'under certain conditions and restrictions' would 
 imply the continuation of an intolerable federal 'suzerainty' 
 over this province. At the Conference of November, 1918, 
 'the representatives of the following provinces, namely: On- 
 tario, Quebec, Nova Scotia, New Brunswick, Prince Edward 
 Island, and British Columbia' contended that 'in the event of 
 the special allowances in lieu of lands' (provided by the Alberta 
 and Saskatchewan Acts and the Manitoba Boundaries Extension 
 Act) 'being maintained in whole or in part, a proportionate 
 allowance calculated on the basis indicated in the said Acts 
 be granted to each of the other provinces of Confederation.' 
 A calculation 'on the basis indicated in the said Acts' is scarcely 
 possible in the cases of those provinces because the calculation 
 of 1905 was based upon the estimated value ($37,500,000) 
 of the public domain withdrawn from provincial control 'for 
 the purposes of Canada.' @ The provinces of Ontario, Quebec, 
 
 ©Premiers Norris, Martin and Stewart to Sir Thomas White, Nov. 19,1918. 
 
 ®The basis of section 20 of the Alberta and Saskatchewan Acts was outHned 
 as follows by Sir Wilfrid Laurier : 'As the public lands in the said provinces are 
 'to remain the property of Canada, there shall be paid by Canada to the said 
 'provinces annually by way of compensation therefor a sum based upon the 
 'estimated value of such lands, (namely $37,500,000) ; the same being assumed 
 
118 Province or Colony? 
 
 Nova Scotia, New Brunswick and British Columbia have 
 enjoyed full beneficial control of their public domain since the 
 granting of responsible government. As already pointed outy- 
 the original subsidy in lieu of lands in Manitoba was demanded 
 'in consideration of the lands within Manitoba appropriated 
 by the Dominion for the building of the Canadian Pacific 
 Railway,' and was granted 'as is done in Prince Edward Island.' 
 
 Similarly the compensation demanded for the 'school lands' 
 of the West would constitute not only an implicit denial to 
 the Prairie Provinces of their 'undoubted rights to their public 
 lands and natural resources' but a truly ironical penalty upon 
 the Dominion Government for qualifying that denial even in 
 the sovereign interests of education. It must be admitted also 
 that the reservation of 'any special claim . . . upon any 
 other ground whatsoever' for adjustment 'at the same time as 
 the lands and natural resources are transferred to the provinces 
 of Manitoba, Saskatchewan and Alberta' has a certain compre- 
 hensiveness about it which appears to be well calculated to 
 defy any attempt at evasion. 
 
 Passing, however, from the 'Conference of the representa- 
 tives of all the Provinces of Canada' in November, 1918, the 
 issue would appear to be simplified in one important respect 
 at least by the official views elsewhere expressed by the Pre- 
 miers of the Maritime Provinces. With regard to the proposal 
 of Premiers Sifton, Scott and Roblin (December 22, 1913), 
 transmitted by the Federal Government, Premier Fleming of 
 
 'to be of an area of 25,000,000 acres and to be of the value of $1.50 per acre, 
 'and upon the population of the said provinces as from time to time ascer- 
 'tained by the quinquennial census thereof, such sum to be arrived at as 
 'follows: 
 
 'The population of the said provinces being assumed to be at present 
 '250,000, the sum payable until such population reaches 400,000 is to be one 
 'per cent, on such estimated value, or $375,000. 
 
 'Thereafter until such population reaches 800,000, the sum payable is to 
 'be one and one-half per cent, on such estimated value, or $562,500. 
 
 'Thereafter until such population reaches 1,200,000, the sum payable is 
 "to be two per cent, on such estimated value, or $750,000. 
 
 "And thereafter such payment is to be three per cent, on such estimated 
 •value, or $1,112,500.' Hansard, 1905. p. 1439. 
 
Province or Colony? 119 
 
 New Brunswick expressed the opinion: 
 
 'As to the wisdom of these three prairie provinces having 
 'handed over to them the pubHc lands is a question be- 
 'tween the federal Government and the provinces interested 
 'and affected, and I do not wish to express any opinion 
 'in relation to that question.' 
 
 Similarly Premier Murray of Nova Scotia, though protest- 
 ing against the retention of 'both the lands and the money' by 
 the Prairie Provinces as 'an entire disturbance of the financial 
 arrangement between the various provinces,' conceded the 
 fact that the public domain of the West was not the concern 
 of the other provinces of Canada in their provincial capacity: 
 'I recognize the fact that the question of the wisdom of 
 'giving the provinces the lands is one between the Dominion 
 'Government and the western provinces.'© 
 
 Now it cannot be too strongly emphasized that the 'Natural 
 Resources Question' is not two questions but one. It is not a 
 question of lands and a question of subsidy but a question of 
 public lands and public lands only as from the date of the 
 assumption of the duties and obligations of responsible govern- 
 ment. It is submitted that there is no justification for inter- 
 preting the compensation for natural resources alienated for 
 half a century 'by the Government of Canada for the purposes 
 of the Dominion' as a species of cash subsidy like that 'for the 
 support of the Government and Legislature' or the 80c per 
 capita grant to the provinces in return for the surrender of 
 customs revenues to the Dominion. In a very real sense the 
 compensation for alienated resources is not a subsidy at all. 
 It is the equity due to this province from a usurpation which 
 took place fifty years ago. It is part and parcel of the public 
 domain as from 1870: nothing more and assuredly nothing less. 
 In that sense even the 'two fundamental principles' cited by 
 the three Western Premiers in defence of their proposal of 
 December 22, 1918, are found to be in essence but one, for the 
 'right to compensation for such portions of the public domain 
 as have been alienated for the general benefit of Canada' is 
 but a corollary to the clear-cut and convincing challenge of 
 
 ©Quoted by Sir Robert Borden, Hansard, Feb. 24, 1914, p. 1069, et seq. 
 
120 Province or Colony? 
 
 Sir Robert Borden in inaugurating the ascendancy of British 
 as distinct from American principles in 1905: 
 
 'The people of the northwest, when they are granted 
 'provincial rights . . . are entitled to the control 
 'of these lands just as much as the people of the eastern 
 'provinces of Canada are entitled to the control of their 
 'provincial domain. I see no distinction.'® 
 
 In conclusion it may be submitted, with all respect, that 
 with the opinion as expressed above by Premier Fleming of 
 New Brunswick and Premier Murray of Nova Scotia, the 
 Prairie Provinces will be found to be in complete agreement. 
 
 It is a remarkable coincidence that the 'Natural Resources 
 Question' should culminate in this two hundred and fiftieth 
 anniversary of the granting of the Hudson's Bay Charter, 
 the hundredth anniversary of the death of Selkirk — whose 
 work of settlement in the West may be regarded as the one 
 vested interest which withstood American expansion west- 
 ward and northward during the nineteenth century — and the 
 fiftieth anniversary of the entrance of Manitoba into Con- 
 federation: the quarter-millennium of the thing which made 
 this western country British, the centenary of the thing which 
 kept it British and the jubilee of the thing that made it Cana- 
 dian. 
 
 It is altogether fitting that this should be, for the settle- 
 ment of the 'Natural Resources Question' is a Canadian problem 
 altogether much more fundamental than the nice adjust- 
 ment of subsidies or the liquidation of all possible provincial 
 "claims' against the Federal Government. It is nothing less 
 than the consummation of Confederation itself — a process 
 which is necessary within the Dominion before the Dominion 
 can take its rightful place among the autonomous British 
 nations of the Empire. The only thing that would seem to be 
 comparable to it in this respect is the projected Union of 
 
 ® Hansard, 1905, p. 2929. 
 
Province or Colony? 121 
 
 the Maritime Provinces; but whereas 'Maritime Union' would 
 be a superstructure to Confederation, a piece of constructive 
 statesmanship inspired by a vision of the future, the 'Natural 
 Resources Question' is a flaw in the very cornerstone of Con- 
 federation, aggravated and complicated by half a century of 
 wrong. 
 
 It is seldom that a definite principle has been more care- 
 fully safeguarded in constitutional legislation than full pro- 
 vincial 'rights over the land' in the British North America Act 
 of 1867. There is perhaps no more distinctive feature of that 
 great measure, for as Lord Durham remarked more than 
 eighty years ago, 'the function of authority most full of good or 
 evil consequences has been the disposal of public land.' Those 
 functions were committed deliberately to the separate prov- 
 inces. By the provisions of section 146 of the British North 
 America Act of 1867, even the subsequent admission of British 
 Columbia, Prince Edward Island, Newfoundland, Rupert's 
 Land and the North-western Territory was made 'subject to 
 the provisions of this Act.' There is no 'function of authority' 
 in which the province as such is more conspicuously 'supreme' 
 and 'directly under the Crown as its head.' Indeed there is 
 a sense in which the provincial control of the public domain 
 served an even more fundamental purpose. It is more than 
 the cornerstone of Confederation. It was part of the founda- 
 tion, the very bed-rock upon which the whole edifice was built, 
 for without responsible government and its first corollary, 
 the "grant of full rights over the land,' the provinces which 
 entered into Confederation in 1867 would never have been in a 
 position to aspire to a British and transcontinental Dominion. 
 
 Now while it is seldom that a great principle has been so 
 discerningly built into the foundations of a nation, it is doubt- 
 ful if a parallel can be found to the half-century of devious 
 expediency during which this fundamental principle has re- 
 mained in abeyance in the case of Manitoba. Beyond a doubt 
 this Province has been the Cinderella of Confederation; it has 
 been her misfortune for fifty years to sit among the ashes and 
 aspire only to the commonplace rights and privileges of the 
 
122 Province or Colony? 
 
 more fortunate provinces of the Dominion. She inherited 
 from the Riel Insurrection an unenviable prejudice from the 
 rest of Canada that was as meaningless as it was unjust- 
 Within her boundaries for fifty years have been fought out 
 the bitter controversies of Quebec and Ontario. The very 
 'school clause' of the Manitoba Act was devised 'according to 
 the system of the Province of Quebec.'® Railway communica- 
 tions east and west were a by-product of the terms of union 
 with British Columbia, and the public domain was withheld 
 because the Canadian Pacific Railway 'must be built by 
 means of the land through which it had to pass.' 
 
 With regard to 'land revenues' it was twelve years before 
 any fiscal concessions were made to alleviate the poverty in 
 that respect which had been imposed upon the province 'for 
 the purposes of the Dominion.' 'Land revenues' elsewhere 
 were the normal function of the public domain in rapidly 
 developing communities. With millions of acres of the richest 
 soil in North America within her boundaries, this province was 
 starved in the midst of plenty. Even in 1882 the grant of 
 $45,000 'in lieu of lands' was made 'as is done in Prince Ed- 
 ward Island.' The sum of $100,000 to which the subsidy in 
 lieu of lands was increased in 1885 had been suggested by the 
 case of British Columbia for the 'railway belt' through the 
 Rocky Mountains transferred 'in trust' to the Dominion. 
 
 In default of convenient British precedents with regard to 
 the land, the public domain of Manitoba was administered in 
 accordance with American— or the perversion of American — 
 precedents which had been superceded seventy-five years ago 
 in the British Empire by the practice of responsible govern- 
 ment. The Dominion has done to Manitoba what the Govern- 
 ment of the United States has never done to the smallest 
 'Land State' of the Union, and the Government of the United 
 States has done to all the 'Land States' of the Union what 
 George III never contemplated for Massachusetts. 
 
 ©Clause 7 of the 'secret' list of rights upon which the discussions upon 
 the Manitoba Bill were based. Archbishop Tach6's Letter to the Winnipeg 
 Free Press, Dec. 27, 1889. 
 
Province or Colony? 123 
 
 Had the Dominion instead of the Province of Ontario com- 
 manded the services of Sir Oliver Mowat, the boundaries of 
 Manitoba would almost undoubtedly have included a littoral 
 on Lake Superiot in the Ontario boundaries disputes of the 
 'eighties. When the boundaries of the province were extended 
 in 1912, the northern boundary was determined by the case 
 of Alberta and Saskatchewan in 1905. Even in 1912 the 
 boundaries of Ontario and Quebec had to be so generously 
 extended also that the Maritime Provinces have lodged claims 
 for compensation for which it is proposed to secure equal 
 priority with the half-century of 'provincial rights over the 
 land' in Manitoba. It must be admitted that in the "railway 
 strip' to Port Nelson which was granted also to Ontario 
 through Manitoban territory in 1912, there is a refinement of 
 this traditional policy for which it would be difficult to find a 
 parallel. 'Chartered territory' which could not be entrusted 
 to the beneficial control of Manitoba because it had been 
 'purchased' by the Dominion from the Hudson's Bay Com- 
 pany, is granted to Ontario not as 'ungranted or waste lands' 
 under beneficial control within its own boundaries but as 
 property in full economic ownership within the boundaries 
 of Manitoba. At the same time the old subsidy to this prov- 
 ince ('in consideration of the lands within Manitoba appro- 
 priated by the Dominion' for railway purposes) and the 'swamp 
 lands' — the one moiety or semblance of 'provincial rights over 
 the land' ever enjoyed by this province— were surrendered 
 in order to "place Manitoba on a basis of equality with Sas- 
 katchewan and Alberta.'® 
 
 It is submitted that the time has come to right this half- 
 century of vested wrong by an Imperial amendment to the 
 British North America Acts which shall leave this province like 
 the other provinces of the Dominion 'supreme' over its own 
 lands 'directly under the Crown as its head.' Instead of 
 aspiring to the commonplace rights and privileges of more 
 fortunate states and provinces 'as is done in Prince Edward 
 Island,' 'according to the system of the province of Quebec,' 
 
 ©Premier Borden to Premier Scott, Jan. 9, 1913. 
 
124 Province or Colony? 
 
 as was done in British Columbia, as was said to obtain in the 
 'Land States' of the American Union, it would not be amiss to 
 consider the 'Natural Resources Question' upon the merits of 
 the case of this province. Let it be repeated that this can be 
 done only by a resolute adherence to 'first principles.' The 
 sound constitutionahsm which has guided so judiciously the 
 relationships of the Dominion within the Empire is confronted 
 within the Dominion itself with a problem which will require 
 for its solution the most signal contribution to the constitu- 
 tional structure of Confederation since the original conditions 
 under the British North America Act of 1867— 'subject to 
 the provisions of this Act' — were abrogated by the Manitoba 
 Act almost exactly fifty years ago. 'The Natural Resources 
 Question' may thus be said, without false modesty, to consti- 
 tute one of the most important problems of the Dominion. 
 Its settlement would set the seal of full provincial status under 
 the British North America Act of 1867 upon three Canadian 
 'colonies,' and would enable the Dominion, with its house in 
 order, to move forward discerningly among the British nations 
 of the Empire and the other nations of the world. 
 
 SUMMARY 
 
 1. Sound constitutionalism at Ottawa is the necessary 
 counterpart of the 'fight for provincial rights' {Premier Nor- 
 quay) in Manitoba. It is fitting — and necessary — that rela- 
 tionships within the Empire and abroad, and the anomalies 
 of Confederation at home, should be settled at the same time 
 and by the same methods. 
 
 2. The ascendancy of British principles becomes definitely 
 traceable since the Alberta and Saskatchewan Acts. Argu- 
 ments against provincial control of the public domain 'would 
 have justified the retention by the Imperial government up 
 to the present time of every acre of Crown Lands in Canada.' 
 'The people of the northwest when they are granted provincial 
 rights . . . are entitled to the control of these lands.' 
 (Sir Robert Borden.) 
 
 3. 'The restitution of the public lands to the Provinces 
 of Alberta and Saskatchewan upon fair terms' was advocated 
 in 1907; the 'just recognition' for the Prairie Provinces 'of their 
 
Province or Colony? 125 
 
 undoubted rights to their public lands and natural resources' 
 in 1911; though by February, 1914, serious and compHcated 
 'difficulties . . . have now to be surmounted.' 
 
 4. On December 22, 1913, the three western Premiers 
 had submitted their proposal: 
 
 'that the financial terms already arranged between the 
 'provinces and the Dominion as compensation for lands 
 'should stand as compensation for lands already alienated 
 'for the general benefit of Canada' ; 
 
 and subsequently urged in its defence 'two fundamental prin- 
 ciples' already conceded, (a) the right of the provinces to the 
 public domain, {b) 'their right to compensation for such por- 
 tions of the same as have been alienated for the general benefit 
 of Canada.' (Premiers Scott, Sifton and Norris.) 
 
 5. The 'Resources Question' was then overshadowed 
 by the war until the Conference of November, 1918, when it 
 was submitted to 'representatives of all the provinces of 
 Canada' in their provincial capacity, with the intimation that 
 'the Government was disposed to give favourable considera- 
 tion . . . provided that it was mutually satisfactory to 
 the other Provinces of the Dominion.' 
 
 6. A resolution of 'the other Provinces of- the Dominion' 
 demanded : 
 
 'that in the event of the special allowances in lieu of 
 'lands . . . being maintained in whole or in part, 
 'a proportionate allowance . . be granted to each 
 
 'of the other provinces of Confederation — reserving however 
 'any special claim . . . upon any other ground 
 'whatsoever.' 
 
 7. Pending a return to normal federal channels the 'Natur- 
 al Resources Question' would seem to have been consigned to 
 the limbo of inter-provincial controversy whence ghosts of 
 unburied causes seek in vain for deliverance. 
 
 8. Two fragmentary features of the 'Resources Question' 
 challenge attention, (a) the suggestions of 'certain reservations' 
 in connection with the return of the public domain to the 
 Prairie Provinces, and (6) the intervention of other provinces 
 in a purely provincial capacity in the 'Resources Question' of 
 the West. 
 
 9. With regard to the former, any arbitrary 'conditions 
 and restrictions' with regard to lands would amount to a 
 concession of 'the principle that the government do not intend 
 
126 Province or Colony? 
 
 to hand them over.' Instead of the province being 'suprenae' 
 over its own pubHc domain 'directly under the Crown as its 
 head,' the Dominion would still be exercising an intolerable 
 "suzerainty'. 
 
 10. The primary functions of the pubUc domain are 
 fiscal. 'Colonists of the Anglo-Saxon race look upon the 
 land revenue as legitimately belonging to the community.' 
 (Colonial Office.) P.E.I, had 'no lands the proceeds of the 
 sale of which could, as in other British Colonies, be appropriated 
 towards local improvements and the maintenance of govern- 
 ment.' {Can. Privy Council.) The 'guiding principle' of 
 Confederation with regard to the public domain was 'that 
 the provinces were entitled to the public lands as a source of 
 revenue to administer to the growing wants of the population 
 in each Province.' (Sir Wilfrid Laurier.) 
 
 11. These normal functions of public lands (exemplified 
 even in this province in 'school lands,' 'swamp lands,' etc.), 
 were denied to Manitoba with regard to millions of acres of 
 some of the richest lands in North America. The Prairie 
 Provinces are entitled to adequate compensation if the old 
 system is to be continued, and to statutory safeguards in any 
 case ensuring full provincial status without any qualifications 
 whatever. 
 
 12. The reference of the 'Resources Question' to the 'repre- 
 sentatives of all the provinces' is more difficult to discuss with 
 equanimity because it would seem to leave the fiduciary 
 obligations of the Dominion in administering the public domain 
 of the Prairie Provinces to be determined by the other prov- 
 inces of Canada on the basis of fiscal expediency; and ac- 
 quiescence would 'virtually establish an admission on our part 
 that the other Provinces have a right to share in the beneficial 
 interest in our public domain.' {Premiers Harris, Martin 
 and Stewart.) 
 
 13. 'The Natural Resources Question' is not two questions 
 but one. It is not a question of lands and a question of sub- 
 sidy, but a question of lands as from 1870. The 'Resources 
 Question' is one question and the Federal Government alone 
 must be its prophet. Compensation for alienated lands is 
 thus the equity due to this province in respect of lands as 
 from the assumption of responsible government. 
 
 14. 'The wisdom of these three Prairie Provinces having 
 handed over to them the public lands is a question between the 
 federal Government and the provinces interested and affected.' 
 {Premier Fleming of New Brunswick.) 'The question of the 
 
Province or Colony? 127 
 
 wisdom of giving the provinces the lands is one between the 
 Dominion Government and the western provinces.' {Premier 
 Murray of Nova Scotia.) 
 
 15. This is a problem not of adjusting subsidies or liquidat- 
 ing provincial claims, but of consummating Confederation. 
 Provincial control of public lands was the cornerstone, the 
 foundation of the B.N. A. Act of 1867, and the first corollary 
 of responsible government. In this respect Manitoba has been 
 the Cinderella of Confederation; grudgingly admitted to rights 
 that were elsewhere taken for granted, 'as is done in P.E.I.', 
 as was done in B.C., as was said to obtain in the 'Land States' 
 of the American Union. It would not be amiss to settle 'the 
 Natural Resources Question' upon the merits of the case of 
 this province. 
 
 16. The time has come to right this half-century of vested 
 wrong, and by Imperial statute to make this province like 
 the other provinces of the Dominion, 'supreme' over its own 
 lands 'directly under the Crown as its head.' 
 
APPENDIX. 
 
 GENERAL SUMMARY. 
 
 I. INTRODUCTION: THE NATURE AND 
 SCOPE OP THE INQUIRY. 
 
 1. A very representative convention at Fort Garry 
 (February, 1870) claimed among the terms of proposed union 
 with Canada 'full control of all the public land' for the 
 'Local Legislature.' Similar claims were advanced on at 
 least three other occasions by less representative sections of 
 the community during the process of transfer of Rupert's 
 Land to Canada. The provincial control of the public 
 domain has been advocated almost continuously for fifty 
 years. 
 
 2. The principles underlying this claim, however, are 
 much older than the Province of Manitoba or the Dominion 
 of Canada. The public domain has always been, and still 
 remains, in title 'vested in the Crown' which is 'one and 
 indivisible throughout the Empire' {Lord Haldane in P.C.); 
 but two functions with regard to it, viz. (a) the administra- 
 tion of the same, and {h) the beneficial interest therein, were 
 long in dispute until both were unreservedly conceded to 
 self-governing provinces upon their undertaking the duties 
 and obligations of 'responsible government.' 
 
 3. The claims of Manitoba are in exact conformity with 
 this double principle as applied to the period of her status as 
 a Canadian province since 1870, viz. (o) the unrestricted 
 control of natural resources hitherto unalienated, and (&) 
 ample recognition of full beneficial interest not only in these 
 but in those already alienated by 'the Government of Canada 
 for the purposes of the Dominion.' 
 
 4. The issue, therefore, is as fundamental as was the 
 control of crown lands, the 'clergy reserves,' etc., in Upper 
 Canada over eighty years ago. In fact it is largely the same 
 issue: whether Manitoba is a 'colony' or a province of the 
 Dominion. 
 
 5. The principles then established have been applied 
 everywhere to self-governing provinces under 'responsible 
 government'; to the Maritime Provinces and to 'Canada' long 
 before Confederation; to Newfoundland and New Zealand 
 
130 General Summary 
 
 and the provinces of the Australian Commonwealth; to all 
 the original provinces of the Canadian Confederation as 
 safeguarded by the B.N. A. Act, 1867, section 109; to British 
 Columbia and Prince Edward Island which have since entered 
 Confederation; to all the self-governing provinces and 
 Dominions of the Empire, in fact, but the Prairie Provinces 
 of Canada. 
 
 6. The present inquiry, therefore, may be simplified by 
 outlining at the outset the range of historical evidence to be 
 examined in the following sections: 
 
 (II.) British Principles with Regard to the Public 
 Domain, as established in Canada at 'respon- 
 sible government.' 
 
 (III.) The conditions determining The Surrender of 
 Chartered Rights in Rupert's Land and the 
 'Transfer' to Canada in 1870. 
 
 (IV.) The circumstances of The 'Transfer' and Pro- 
 vincial Status for Manitoba in 1870. 
 (V.) An examination of British Principles and 
 Canadian Practice in British Columbia in 1871. 
 
 (VI.) A similar examination of British Principles and 
 Canadian Practice in Prince Edward Island in 
 1873. 
 (VII.) An outline— in humiliating contrast with British 
 practices elsewhere — of Federal Policy and 
 Provincial Poverty in Manitoba after 1870. 
 (VIII.) A discussion of the "subsidy in lieu of lands' in 
 1882 and the federal avowal of American 
 Precedents for a British Province. 
 
 (IX.) An outline of the return to sound British con- 
 stitutional principles and their application to 
 the present 'Natural Resour-ces Question': 
 British Principles in the Ascendant: Province or 
 Colony ? 
 
 II. BRITISH PRINCIPLES WITH REGARD TO 
 THE PUBLIC DOMAIN. 
 
 1. The claim to (a) the administration of the public 
 domain, (6) the beneficial interest therein, formed an integral 
 part of the conflict for 'responsible government' in Canada. 
 
 2. Both these functions were definitely conceded more than 
 -eventy-five years ago to provinces under 'responsible govern- 
 
General Summary 131 
 
 ment,' Imperial beneficial control being definitely renounced 
 by statute (15 & 16 Vic, c. 39 and 17 & 18 Vic, c 118). 
 Both functions, therefore, were implicit in provincial status 
 for all the original provinces of Canada. 
 
 3. When these provinces united to form Confederation 
 these rights were confirmed in B.N. A. Act, 1867, s. 109. 
 
 4. Similarly in Newfoundland, New Zealand, the provinces 
 of the Australian Commonwealth, the same principles are 
 uniformly in operation. 'Colonists of the Anglo-Saxon race 
 look upon the land revenue as legitimately belonging to the 
 community.' {Colonial Office, 1864, re Rupert's Land). 
 
 5. 'The plan adopted in every case of the grant of re- 
 sponsible government . . . took the form of a grant of 
 full rights over the lands in exchange for a civil list' {Keith), 
 viz., a compact involving the grant of the beneficial control 
 of the public domain in return for undertaking the obligations 
 of self-government. Manitoba has discharged the duties of 
 'responsible government' with full 'civil list' since 1870 and 
 has been denied for fifty years 'full rights over the lands in 
 exchange.' 
 
 6. Even Lord Durham's proposals with regard to Imperial 
 control of crown lands for purposes of scientifically directed 
 colonization were still-born in Canada, and the only alterna- 
 tive was that 'the whole control of the property should be 
 vested in the most ample and unconditional manner in the 
 Colonial Legislature. This is required by every principle of 
 justice.' {Buller). 
 
 7. The constitutional rights which the original provinces 
 of Confederation now. seek to deny to the Prairie Provinces 
 in the twentieth century are the same rights which they 
 themselves vindicated, even against Lord Durham, during 
 the first half of the nineteenth. The arguments employed 
 against the provincial rights of the Prairie Provinces 'would 
 have justified the retention by the Imperial government up 
 to the present time of every acre of Crown Lands in Canada.' 
 {Sir Robert Borden in 1905). 
 
 8. In respect of public lands, Manitoba is still a 'colony' 
 of the Dominion, with this difference for the worse, that 
 whereas the crown lands before 'responsible government' 
 were administered by residents of the province 'for purely 
 colonial purposes' and 'for local or personal objects' {Buller) 
 those of Manitoba are administered, by Dominion statute, 
 'by the Government of Canada for the purposes of the 
 Dominion.' 
 
132 General Summary 
 
 III. THE SURRENDER OF CHARTERED RIGHTS IN 
 
 RUPERT'S LAND AND THE 'TRANSFER' 
 
 TO CANADA IN 1870. 
 
 The reluctance of other provinces to concede to Manitoba 
 the status in respect of public domain which they themselves 
 have always enjoyed has long been defended upon the claim 
 that Rupert's Land was 'purchased' from the Hudson's Bay 
 Company and became, therefore, the 'property' of Canada. 
 
 (A) — The Nature of the 'Purchase.' 
 
 1. The H.B.C. prepared in 1864 to recognize a Crown 
 Colony in Rupert's Land provided the Company retained 
 extensive proprietary control of the land. 
 
 2. This proposal was refused by the Colonial Office 
 because 'colonists of the Anglo-Saxon race look upon the land 
 revenue as legitimately belonging to the community.' 
 
 3. The H.B.C. therefore, demanded (1868-9) 'the payment, 
 as compensation, of a sum of hard money' for the surrender 
 of their chartered rights. 
 
 4. Canada, however, insistently urged direct cession by 
 the Crown (by the B.N.A. Act, 1867, s. 146) 'without 
 negotiations with any third party in the case.' Even when 
 indemnity for surrender of chartered rights became necessary, 
 Canadian delegates regarded it as the 'cost of legal proceed- 
 ings necessary ... to recover possession.' Conclusive 
 evidence of 'cession' as the official view of Canadian Govern- 
 ment. 
 
 5. Insistence of H.B.C. on monetary compensation led to 
 the Rupert's Land Act, 1868, providing: 
 
 (a) Surrender of all rights under the Charter in Rupert's 
 Land to the Crown 'upon such Terms and Conditions 
 as shall be agreed upon by and between Her Majesty 
 and the said Governor and Company.' 
 
 (6) Union with Canada by Imperial Order in Council as 
 under B.N.A. Act, 1867, section 146. 
 
 6. Canada was forced into this monetary transaction by 
 amendment to the Rupert's Land Act in the House of 
 Commons, by proviso that 'no Charge should be imposed by 
 such Terms upon the Consolidated Fund of the United 
 Kingdom.' 
 
 7. Canada, therefore, was forced to indemnify the H.B.C. 
 for the surrender of chartered rights in Rupert's Land to 
 
General Summary 133 
 
 the Crown, and this was the only part of either transaction 
 involving 'compensation' of any kind. 
 
 8. Object of whole transfer was not to perpetuate pro- 
 prietary administration 'for the purposes of the Dominion' 
 but that the old 'Proprietary Rights,' etc., of the Company 
 should be 'absolutely extinguished' {Ruperts' Land Act) in 
 order to expedite 'settlement as a part of the British Colonial 
 System.' (Colonial Office). 
 
 9. The transfer from the Crown to Canada by Order in 
 Council, therefore, was by cession with all constitutional 
 implications unimpaired: 'the surrender ... by the 
 Company to the Crown and the transfer . . to the 
 Canadian Government, are Acts of State, authorised by 
 Imperial Statute, and will have all the force and permanence 
 of fundamental law' {Canadian delegates) . 
 
 10. The £300,000 was raised by loan, guaranteed by the 
 British Government, 'the principal to be repaid on 1st April, 
 1904.' 
 
 (B) — The Procedure and its Implications. 
 
 1. Two distinct and fundamental transactions were 
 involved : 
 
 (a) surrender of the Hudson's Bay Charter rights in 
 Rupert's Land to the Crown 'upon such Terms and 
 Conditions as shall be agreed upon by and between 
 Her Majesty and the said Governor and Company;' 
 
 {b) cession of 'Rupert's Land' and 'North- Western 
 Territory' to Canada by Imperial Order in Council of 
 June 23, 1870. 
 
 2. The statutory basis of (a) was Rupert's Land Act; that 
 of {b) was B.N. A. Act, 1867, section 146, reiterated in 
 Rupert's Land Act, section 5. 
 
 3. The surrender of chartered rights in Rupert's Land 
 by the Hudson's Bay Company to the Crown was dated 
 November 19, 1869; the surrender was received by the 
 Colonial Office and £300,000 paid on May 11, 1870; the 
 surrender of chartered rights was formally accepted by the 
 Crown by Order in Council of June 22, 1870; 'Rupert's Land' 
 and 'North-Western Territory' united to Canada on July 15 
 by Imperial Order in Council of June 23, 1870. 
 
 4. The 'Terms and Conditions' involving 'compensation' 
 provided for in the Rupert's Land Act apply exclusively to 
 Rupert's Land. The whole area outside Rupert's Land ('the 
 North- Western Territory'), therefore, must be regarded as 
 
134 General Summary 
 
 coming directly to Canada from the Crown by cession under 
 B.N. A. Act, 1867, section 146, and without even the 
 fictitious appearances of preliminary 'purchase.' This is 
 clear from the correspondence of the Colonial Office at the 
 time of the Rupert's Land Act, the attitude of the Canadian 
 Government, etc. 
 
 5. Mainland district of British Columbia ^ready created 
 (1858) out of 'licensed' territory in same relationship to 
 H.B.C. as 'North- Western Territory', yet full beneficial 
 control of public domain was vested in B.C. in 1871. 
 
 6. Similarly, districts from the 'chartered' territory of 
 Rupert's Land were added both to Ontario and to Quebec, 
 with full beneficial control vested in these provinces, despite 
 so-called 'purchase' by Canada in 1870. Even within 
 boundaries of Manitoba, Ontario was granted property 
 rights over 'railway strip' to Port Nelson at the Manitoba 
 Boundaries Extension Act of 1912. 
 
 7. Manitoba, Saskatchewan and Alberta appear to be the 
 only provinces of Canada which cannot be entrusted with 
 beneficial control over either the 'licensed' or 'chartered' 
 territory of the H.B.C. ceded to Canada in 1870. 
 
 8. By the constitutional procedure scrupulously followed 
 in the transfer, therefore, both Rupert's Land and the North- 
 Western Territory came to Canada not from the H.B.C. by 
 'purchase' but from the Crown by 'Acts of State, authorised 
 by Imperial Statute' with 'all the force and permanence of 
 fundamental law.' 
 
 9. In 1871, British Columbia (see Chapter V) received 
 full beneficial control over public domain, both 'licensed' 
 area ceded in 1858 and Vancouver Island which has been 
 re-purchased from the H.B.C. in 1867 for £57,500. It is 
 submitted that Manitoba is entitled to the same fundamental 
 rights as from 1870, 'as a part of the British 
 System.' 
 
 IV. THE 'TRANSFER' AND PROVINCIAL 
 STATUS FOR MANITOBA. 
 
 1. The Manitoba Act provided that upon transfer to 
 Canada by Imperial Order in Council, Manitoba should be 
 'one of the Provinces of the Dominion of Canada.' In the 
 case of this province, therefore, there has been no preliminary 
 period of territorial status, and British principles thus apply 
 with peculiar cogency and directness to the whole Canadian 
 period of our history since 1870. 
 
 2. The animosities of the Riel Insurrection and the 
 
General Summary 135 
 
 motives _ under which provincial status was sought and 
 secured in the Manitoba Act long inspired an unenviable and 
 rather undiscriminating prejudice against this province. 
 
 3. With regard particularly to the beneficial control of the 
 public domain, the conduct of Riel in 1870 has penaUzed the 
 rest of the province for fifty years. 'They wished to have 
 all ~the lands ... as in other Provinces . . . The 
 land could not be handed over to them ... A large 
 Province . . . might interfere with the general policy of 
 the Government . . . The land legislation of the Province 
 might be obstructive to immigration.' (Sir John A. Mac- 
 donald in debate on Manitoba Bill). 
 
 4. The Manitoba Act was based on a secret 'list of rights' 
 which remained generally unknown to the inhabitants of 
 Manitoba for nineteen years. Both the British and Canadian 
 authorities refused to regard the Manitoba Act as 'subject to 
 confirmation by the "Provisional Government" which would 
 have involved a recognition of Riel and his associates.' (Sir 
 Clinton Murdoch). Manitoba was unique, therefore, among 
 the provinces of Canada in that many of the terms of union 
 — and particularly those relating to the public domain — 
 were imposed upon the inhabitants of this province not only 
 without their consent but even without their knowledge. 
 
 5. Section 30 providing for the administration of 'AH 
 ungranted or waste lands ... by the Government of 
 Canada for the purposes of the Dominion' was unique even 
 among the provisions of the Manitoba Act. 'To condone for 
 this refusal' (of the 'control of all the lands of the North- 
 west') the Dominion Government "gave to the children of 
 the half-breed inhabitants . . . one million four hundred 
 thousand acres of land, which had not been asked for.' 
 (Archbishop Tachi). With this removal of opposition to 
 federal control of provincial lands, no precautions were taken 
 to safeguard for the future the territorial rights of Manitoba 
 as a British and Canadian province. 
 
 6. It is noteworthy that the provisions in the Manitoba 
 Act relating to the public domain contravened every ex- 
 pression of opinion, both English-speaking and French, in 
 every list of rights drawn up during the process of transfer. 
 'Full control of all the public land' for the 'Local Legislature' 
 had been stipulated by the Convention of February, 1870, 
 even upon the basis of territorial status. 
 
 7. Whatever the requirements of the hour may have been, 
 therefore, with regard to the temporary 'control' of the 
 public domain of the Province in 1870, the indefensible 
 
136 General Summary 
 
 phrase 'for the purposes of the Dominion' in the Manitoba 
 Act must be regarded as an unwarranted and deliberate 
 violation of fiduciary obligations on the part of the Dominion. 
 The repetition of this phrase in the Saskatchewan Act, the 
 Alberta Act, and even in 1912 in the Manitoba Boundaries 
 Extension Act would seem to indicate in the harshest and' 
 most uncompromising terms the definite 'colonial' subordina- 
 tion of the Prairie Provinces. 
 
 V. BRITISH PRINCIPLES AND CANADIAN PRACTICE 
 IN BRITISH COLUMBIA. 
 
 1. Vancouver Island was granted to the Hudson's Bay 
 Company by Letters Patent of January 13, 1849, and was 
 re-purchased by the Imperial Government on April 23, 1867, 
 for £57,500. 
 
 2. The beneficial control of Vancouver Island, however, 
 was not appropriated by the British Government as the 
 public domain of Manitoba was appropriated (altogether 
 without 'purchase' in that sense) by Canada 'for the purposes 
 of the Dominion.' 
 
 3. There was no attempt to indemnify the British Govern- 
 ment for the £57,500 by administering the land 'for the 
 purposes of Great Britain; while Canada 'by obtaining 
 control of these lands' (Manitoba) sought 
 
 'to obtain repayment of the disbursement of the £300,000. 
 '. . . The expense would be defrayed by that means 
 'instead of being charged against the people of the 
 'Provinces of Ontario, Quebec, Nova Scotia, and New 
 'Brunswick. That could be done, however, only by 
 'carrying out that policy of keeping the control of the 
 'lands of the country, and . . . they had determined 
 'to do so.' (Sir John A. Macdonald). 
 
 4. The mainland colony of 'British Columbia' was created 
 (1858) from districts which had formerly been 'licensed' 
 areas of the Hudson's Bay Company, corresponding to the 
 'North-Western Territory' of the Prairie Provinces. 
 
 5. The two districts, therefore, which were united in 1866 
 under the name of British Columbia, resembled 'Rupert's 
 Land' and the 'North-Western Territory' in having been 
 'granted' and 'licensed' territory respectively of the Hudson's 
 Bay Company. 
 
 6. It was only in clause 14 of the terms of union that 
 provision was first -made for 'the introduction of responsible 
 
General Summary 137 
 
 government when desired by the inhabitants of British 
 Columbia.' Even the Address pursuant to B.N. A. Act, 1867, 
 section 146, had to be passed by legislative council, which was 
 then for the first time predominantly elective (nine out of 
 fifteen members). 
 
 7. British Columbia thus acquired control of public 
 domain and beneficial interest therein before having exercised 
 responsible or even fully representative government. 
 Manitoba assumed obligations of responsible government 
 fifty years ago and has been denied ever since both functions 
 with regard to the public domain. ' 
 
 8. Upon entering Confederation, B.C. assumed almost 
 automatically the beneficial control of public domain. The 
 issue was neither raised nor discussed nor specifically men- 
 tioned in the articles of union, and British principles thus 
 prevailed with the first provisions for 'the introduction of 
 responsible government.' 
 
 9. Even the 'railway belt' for the transcontinental railway 
 stipulated by B.C. as the price of union, was transferred to 
 Canada 'in trust' at an annual payment of $100,000. This 
 subsidy, therefore, must be regarded as the interest on the 
 capital fiscal value to the province of lands thus administered 
 'in trust' by Canada for the purposes of the Dominion. 
 
 10. Within this category, it is submitted, must be re- 
 garded the subsidy 'in lieu of lands' first granted to Manitoba 
 in 1882 during the projection of the C.P.R. The lands 
 alienated by Canada in Manitoba since 1870 have been 
 administered by statute (33 Vic, c. 3, s. 30) 'for the purposes 
 of the Dominion,' and ought to be accounted for like the 
 railway lands of British Columbia upon a similar fiduciary 
 basis. 
 
 VI. BRITISH PRINCIPLES AND CANADIAN PRACTICE 
 IN PRINCE EDWARD ISLAND 
 
 1. In Prince Edward Island, automatic conformity, as in 
 British Columbia, with British practice was no longer possible 
 because the public domain had already been granted to 
 absentee proprietors nearly a century before Confederation 
 and long before the period of 'responsible government.' 
 
 2. The Colonial Office, in fact, had urged the case of 
 Prince Edward Island against the old system of control of 
 the public domain in Rupert's Land in the beneficial interest 
 
138 General Summary 
 
 of those (H.B. Co.) who did not themselves constitute the 
 community : 
 
 'In an unsettled colony there is no effectual mode of 
 
 'taxation for purposes of government and improve- 
 
 ■'ment . 
 
 'In Prince Edward Island . . . the result has 
 
 not been such as to invite imitation . . . 
 
 'It is clear that colonists of the Anglo-Saxon race look 
 
 'upon the land revenue as legitimately belonging to the 
 
 'community.' 
 
 3. The 'land question,' therefore, like the 'railway 
 question' in B.C., was the chief issue in discussing terms of 
 union, and there were two distinct phases of the problem: 
 
 (a) the loss of Crown lands and consequent lack of 
 normal land revenues of British provinces 'for 
 purposes of government and improvement;' 
 
 (6) the survival of proprietary tenures. 
 
 4. The first proposals from the Canadian Privy Council 
 (December 14, 1869) with regard to these two phases of the 
 'land question' suggested: 
 
 (a) a sum of $800,000 'as a compensation for the loss of 
 such Crown Lands' ('in lieu of the lands thus granted 
 'by the Crown') 'the proceeds of the sale of which 
 'could, as in the other British colonies, be ap- 
 'propriated towards local improvements and the 
 'maintenance of Government;' 
 
 (b) that the Dominion should 'use their influence to 
 'secure such legislation as will enable the Govern- 
 'ment of the Island to purchase the land now held 
 'in large blocks.' 
 
 5. These terms were not regarded by the Island Govern- 
 ment as 'sufficiently liberal' to 'establish this Colony in a 
 position as regards land tenures and territorial revenues 
 similar to that occupied by the adjoining Provinces.' Two 
 demands, therefore, were formulated {Committee of Council, 
 P.E.I., January 7, 1870): 
 
 (a) 'indemnity . . . for loss of Territorial Revenue;' 
 
 (b) 'a full and immediate settlement of the Land 
 tenure.' 
 
 6. These requirements were conceded in the terms of 
 union (March 7 and M^ 15, 1873) by the following provi- 
 sions : 
 
General Summary 139 
 
 (a) indemnity of $45,000 per annum (still paid) since 
 the Island Government had lost their Crown lands 
 and 'consequently enjoys no revenue from that 
 source for the construction and maintenance of local 
 works;' 
 
 (b) a loan from the Dominion not to exceed $800,000 at 
 5 per cent, per annum 'for the purchase of lands now 
 held by large proprietors.' 
 
 7. It is seen, therefore, that the Dominion, to whom the 
 beneficial control of the alienated lands of the Island had 
 not belonged, and to whom, therefore, 'no purchase-money or 
 rents of land have been paid' {P.E.I. Council) agreed never- 
 theless to pay P.E.I, an annual subsidy 'in lieu of the lands 
 thus granted by the Crown' and in default of 'revenue from 
 that source for . . local works.' This subsidy repre- 
 sents a capital sum of $900,000, $100,000 in excess of that 
 originally offered by Canada (see 4 (a) above) and declined 
 by P.E.I, as not 'sufficiently liberal.' 
 
 8. With regard to the other phase of the question, the 
 'settlement of the Land tenure,' the sums advanced by the 
 Dominion enabled the Island to expropriate the proprietary 
 holdings under the terms of the Land Purchase Act of 1875 
 and its amendments. These expropriated lands became 
 automatically revenue-producing public domain, yielding 
 during the twenty-one year period 1879-1900 alone (which 
 does not include the most productive years) more than the 
 total capital sums advanced by the Dominion. 
 
 9. One transaction, therefore, implies the retroactive 
 beneficial interest of the province in lands alienated from 
 without for purposes other than those of the community; 
 the other implies the right to the beneficial control of the 
 public domain still available. Both provisions are seen to be 
 in conformity with sound British principles already outlined 
 as inherent in provincial status since the concession of 
 'responsible government.' 
 
 10. In Manitoba the only obstacle to precisely similar 
 claims is the Dominion Government itself. In P.E.I, aliena- 
 tions had been made by the Crown for over a century, and 
 long before the period of 'responsible government'; in 
 Manitoba alienations have been made for fifty years after 
 provincial status 'by the Government of Canada for the 
 purposes of the Dominion.' Even the subsidy of Manitoba 
 'in lieu of lands' was conceded ('as is done in P.E.I.' viz., 'in 
 lieu of lands thus granted by the Crown') only twelve years 
 
140 General Summary 
 
 after provincial status (1882) and after the Dominion had 
 determined to appropriate for railways alone in the West an 
 acreage seventy times the whole area of P.E.I. 
 
 11. With regard to resources hitherto unalienated, the 
 Dominion enabled P.E.I, to expropriate the lands of the 
 proprietary holders. In Manitoba the Dominion Government 
 is still playing the r61e of the proprietary grantees themselves 
 in administering the public domain by statute, 'for the 
 purposes of the Dominion.' 
 
 VII. FEDERAL POLICY AND PROVINCIAL POVERTY 
 IN MANITOBA AFTER 1870. 
 
 1. The years of controversy for 'provincial rights' after 
 1870 were 'neither fair to the Province nor creditable to the 
 Dominion' (Premier Nor quay). The necessity of returning to 
 first principles would seem to be self-evident. The issue is 
 too fundamental — it has already played too profound a part 
 in the political development of British peoples all over the 
 world — to admit here of casual adjustment or evasion. 
 
 2. The only feasible settlement is that which is every- 
 where prevalent in other provinces and Dominions of the 
 Empire, viz., 'exactly the same control over their lands as is 
 enjoyed by the people of the other provinces . . . When 
 they are granted provincial rights . . . they are entitled 
 to the control of these lands just as much as the people of 
 the eastern provinces ... I see no distinction.' {Prem- 
 ier Borden in 1905). 
 
 3. Manitoba is thus entitled to recognition of full pro- 
 vincial status as from 1870, when it was 'granted provincial 
 rights'; and this involves (a) unrestricted beneficial control of 
 all resources hitherto unalienated, and (6) ample recognition 
 of beneficial interest in the public domain alienated 'by the 
 Government of Canada for the purposes of the Dominion.' 
 
 4. A large measure of federal 'control' was justifiable in 
 1870, in order to build C.P.R., encourage immigration, effect 
 union with B.C., etc.; but it was less than just to achieve 
 these great 'purposes of the Dominion' at the expense of the 
 constitutional rights of Manitoba. 
 
 5. It cannot be gainsaid moreover that in order to re- 
 concile a reluctant public opinion in the rest of Canada to 
 these great national enterprises, the Federal Government 
 construed the administration of the public lands into a 
 species of 'ownership' implying a warrant to alienate them 
 
General Summary 141 
 
 without accountability to the province: 'The land could 
 not be handed over to them . . . The Pacific Railway 
 must be built by means of the lands through which it had to 
 pass . . . They would be in a position to obtain repay- 
 ment of the disbursement of the £300,000.' {Sir John A. 
 Macdonald). The public domain in the West 'had been given 
 up for nothing.' {Sir George Cartier). 'The whole of 
 Manitoba was acquired by the Dominion by purchase . . . 
 and thus became the property of the Dominion.' {Can. 
 Privy Council). 'The expenditure in construction (of the 
 C.P.R.) and in cash subsidies may be regarded as an advance 
 to be repaid from the lands.' {Can. Privy Council). 
 
 6. The attitude of 'purchase,' of 'ownership,' of 'property' 
 'bought' and 'possessed' was reflected even in the statutory 
 basis of the administration of the 'Dominion Lands.' The 
 Manitoba Act was largely ultra vires of Federal Parliament — 
 'of more than doubtful validity.' {Keith). Even provisions 
 with regard to 'ungranted or waste lands' were impugned 
 both then and since until held to be validated by B.N. A. 
 Act, 1871. 
 
 7. This statute confirms Manitoba Act 'for all purposes 
 whatsoever.' The two phrases, therefore, 'for the purposes of 
 the Dominion' and 'for all purposes whatsoever,' are scarcely 
 worthy of the fiduciary obligations of the Dominion towards 
 Manitoba as 'a part of the British . . . System.' The 
 one phrase was devised without the consent or even knowledge 
 of the community directly concerned and in contravention of 
 every recorded expression of their wishes upon the subject; 
 the other was drafted at Ottawa as a perfunctory carte blanche 
 for the Federal Government. They form the statutory basis 
 upon which over 18,000,000 acres of Manitoba have been 
 alienated forever from provincial control. 
 
 8. The period after 1870 in Manitoba is not pleasant to 
 reflect upon. The province was impoverished in a fiscal 
 sense by means of the public domain within its own bound- 
 aries. In order to build the C.P.R. and encourage immigration 
 the Dominion deprived the province of all sources of 'ter- 
 ritorial revenues' at the same time as it added intolerably 
 to the obligations of the province for 'local works.' Mean- 
 while Manitoba made the highest per capita contribution in 
 Canada to federal customs revenues ($10.76 per annum for 
 1874-1883 as compared to |2.41 in P.E.I.) From a fiscal 
 standpoint 'a large addition to the population' was 'nothing 
 short of an evil in disguise.' The province was forced into 
 abject parsimony. The grant of $26,746 was made on 
 
142 General Summary 
 
 condition that government be 'simplified and cheapened by 
 the abolition of the second Chamber.' 
 
 9. Subsidy of $100,000 per annum 'in lieu of lands' was 
 demanded in 1881 'in consideration of the lands within 
 Manitoba appropriated by the Dominion for the building of 
 the Canadian Pacific Railway'; pending a decision the 
 Dominion advanced $50,000 at 5 per cent, on debt account 
 to meet 'the immediate necessities of the Province.' 
 
 10. Subsidy of $45,000 was granted in 1882 'as is done in 
 P.E.I.' and 'intended to close any negotiations on that 
 subject for the next ten years.' 
 
 11. Increased subsidy of $100,000 in 1885 was made 
 contingent upon 'finality clause' which has left a sense of 
 humiliation deeper even than 'disallowance' and 'the monop- 
 oly clause' of the C.P.R. upon the political traditions of the 
 province. 
 
 VIII. AMERICAN PRECEDENTS FOR A BRITISH PROVINCE. 
 
 1. Two considerations were chiefly responsible for the 
 agitation for 'provincial rights over the land', viz., the in- 
 tolerable financial burdens for 'local works' on account of the 
 free homestead and immigration policy of the Dominion, and 
 the practice of lavish grants for railways. 
 
 2. Claims of Manitoba (Memorandum, Feb. 12, 1881) 
 were advanced (a) that a subsidy of $100,000 (the same as in 
 B.C.) be granted 'in consideration of the lands within 
 Manitoba appropriated by the Dominion for the building of 
 the Canadian Pacific Railway', (b) that 'the residue of un- 
 granted land shall be handed over to the Province for the 
 purpose of local revenue.' 
 
 3. The case of P.E.I. ($45,000) was substituted by the 
 Dominion for that of B.C. ($100,000), and the grant was 
 eventually made (1882) 'as is done in P.E.I.' {Report oj 
 Committee of Can. P.C.) It may be contended, therefore, 
 that both the original claim 'in consideration of the lands 
 within Manitoba appropriated . . . for the building of 
 the Canadian Pacific Railway' and the grant substituted for 
 it 'as is done in P.E.I.', are based not upon future control of 
 'ungranted or waste lands in the Province' but upon lands 
 already permanently alienated without regard to the benefi- 
 cial interest of the community. (Cf. the proposals of Dec. 22, 
 1913, 'that the financial terms already arranged ... as 
 compensation for lands should stand as compensation for 
 lands already alienated for the general benefit of Canada.') 
 
General Summary 143 
 
 4. 'Swamp lands' were transferred to the province in 
 1884, but the subsidy of $100,000 in lieu of lands in 1885 was 
 made contingent upon the 'finality clause'. This completed 
 the discomfiture of the province in the attempt to secure 
 'payment for the lands already disposed of . . . within 
 the Province' and the 'control, management and sale of the 
 Public Lands within its limits, for the public uses thereof.' 
 
 5. The 'subsidy in lieu of lands' was interpreted even by 
 Sir Wilfrid Laurier as proof that the 'guiding principle' of 
 Confederation in respect of lands was 'not absolutely de- 
 parted from in the case of Manitoba.' The principles at the 
 root of the whole matter, however, were not conceded, and 
 the Dominion met the demand 'that the residue of ungranted 
 land shall be handed over to the Province for the purpose of 
 local revenue' by one of the most astonishing avowals in 
 Canadian constitutional history. 
 
 6. 'The whole of Manitoba was acquired ... by 
 purchase . . . and thus became the property of the 
 Dominion, and stands really ... in the same position 
 as lands in the Territories of the United States, which are not 
 giyen to new States . . . but remain the property of the 
 United States.' (Report of Committee on P.C., approved 
 March 7, 1882). 
 
 7. 'The Government . . . purchased at a large price 
 'in cash, all the rights ... in and to the territory out 
 'of which the Province of Manitoba has been formed; it 
 'incurred, further, a very large expenditure to obtain and 
 'hold this territory in peaceable possession, and ... in 
 'extinguishing Indian titles and maintaining the Indians, so 
 'that the Dominion Government has a very large pecuniary 
 'interest in the soil . . . 
 
 'The expenditure in construction (C.P.R.) and in cash 
 'subsidy, may be regarded as an advance, to be repaid from 
 'the lands . . . 
 
 'It ("the Federal Government of the United States") 
 'rigidly retains the public lands of the State except those it 
 'may appropriate for specific purposes, allotting to the 
 'State only swamp lands . . . 
 
 'It is expedient to recommend to Parliament a modification 
 'of this arrangement . . .' (Report of Committee of P.C., 
 approved May 30, 1884). 
 
 V 
 
 8. This avowal of American precedent was defended by 
 federal administrations both Conservative and Liberal until 
 
144 General Summary 
 
 1911, though even under the American system the evidence 
 would seem to support the claims of Manitoba. 
 
 9. A fundamental difference exists between the British 
 and American systems. In the British Empire title to all 
 public domain is 'vested in the Crown'; and whatever may 
 be the difference of opinion with regard to purely statutory 
 or legal rights of the Dominion, the constitutional or political 
 rights of the Province to the beneficial interest in the public 
 domain and ultimate control thereof would seem to be un- 
 impeachable. Statutory powers of the Dominion, therefore 
 (altogether apart from the way these were acquired), must 
 be regarded as fiduciary in character and intermediary, under 
 responsible government, between the Crown and self-govern- 
 ing provinces where full beneficial control must ultimately 
 be vested. 
 
 10. In the United States, each separate state became, at 
 independence, the 'successor to the Crown and colony in the 
 ownership of the unappropriated and vacant lands' in a way 
 which has no parallel in the British Empire. 
 
 11. The nucleus of the national 'public domain' of the 
 United States originated in cessions to the National Govern- 
 ment with full sovereign title, of over 400,000 square miles 
 of hinterland by seven of the thirteen states. It is not on 
 record that the other provinces of Canada have ceded terri- 
 tory to form 'Dominion Lands.' 
 
 12. The States (Maine, Vermont, Tennessee, West 
 Virginia, Kentucky, etc.) organized without previous ter- 
 ritorial status out of this ceded 'public domain' received full 
 sovereign title and ownership of the lands within their 
 boundaries. Manitoba came into Confederation as a province 
 without previous territorial status, and her territory had been 
 'ceded' by the Crown by 'Acts of State, authorised by 
 Imperial Statute', with 'all the force and permanence of 
 fundamental law', long after the principles of responsible 
 government with all its implications had been everywhere 
 conceded. 
 
 13. Even Texas, annexed in 1845, received as a state 
 without previous territorial status, the full title to public 
 lands; and though the districts from the 'Louisiana purchase,' 
 etc., were organized after varying periods of territorial! status 
 into 'Land States', with the public domain still vested in the 
 National Govenmient, measures like the State Selection Act, 
 the Distribution Act, the 'Canal Wagon and Railroad Grants' 
 to various states, the 'Two, Three and Five per cent. Funds', 
 etc., are not in evidence under the American system as 
 
General Summary 145 
 
 applied by the Dominion to Manitoba. The U.S. Govern- 
 ment was represented (Committee of P.C., May 30, 1884) as 
 'allotting to the State only swamp lands.' Even these were 
 taken away from Manitoba in 1912. 
 
 14. Unreserved avowals of American principles were made 
 as late as 1905, at the Alberta and Saskatchewan Bills: 'This 
 is a case in which we can go to the United States for pre- 
 cedents . . . Whenever a new state has been created in 
 the American Union, the Federal Government has always 
 retained the ownership and management of the public lands.' 
 {Sir Wilfrid Laurier). 
 
 15. Basis of subsidy in 1905 and 1912 was more or less 
 arbitrary, but the proposal of December 22, 1913 (present 
 subsidy as 'compensation for lands already alienated') was 
 occasioned by the necessity of reaching a common basis for 
 the perplexing differences of status and development between 
 the three provinces concerned. 
 
 16. Manitoba's original 'subsidy in lieu of lands' was 'in 
 consideration of lands within Manitoba appropriated by the 
 Dominion for the building of the Canadian Pacific Railway'; 
 and even the present subsidy is altogether inadequate for 
 resources alienated for fifty years 'for the purposes of the 
 Dominion.' Railway and H.B. Co. land sales alone (Dec. 31, 
 1917) amounted to $178,000,000, and there are 14,500,000 
 acres left. 
 
 17. Claims of Manitoba may thus be stated in less 
 general terms as: 
 
 (o) Unrestricted beneficial control of all public lands and 
 natural resources hitherto unalienated. 
 
 (6) Compensation at a fixed equitable rate per acre 
 for all lands within Manitoba alienated to the H.B.C. at the 
 transfer, and under section 30 of the Manitoba Act 'by the 
 Government of Canada for the purposes of the Dominion'; 
 such compensation to be made by way of annual payments at 
 5 per cent., and to be reckoned as from the date of alienation, 
 less the amounts received as subsidies in lieu of lands. 
 
 18. The balancing of Dominion receipts and expenditures 
 from Dominion lands is obviously a futile method of determin- 
 ing equitable 'compensation.' Chief alienations have been 
 free grants, 'the purposes of the Dominion' being attained 
 indirectly in other ways. Cf. railway land grants and free 
 homesteads, and the high per capita customs revenues from 
 new settlers. 
 
146 General Summary 
 
 IX. BRITISH PRINCIPLES IN THE ASCENDANT: 
 PROVINCE OR COLONY? 
 
 1. Sound constitutionalism at Ottawa is the necessary 
 counterpart of the 'fight for provincial rights' (Premier Nor- 
 quay) in Manitoba. It is fitting — ^and necessary — that rela- 
 tionships within the Empire and abroad, and the anomalies 
 of Confederation at home, should be settled at the same time 
 and by the same methods. 
 
 2. The ascendancy of British principles becomes definitely 
 traceable since the Alberta and Saskatchewan Acts. Argu- 
 ments against provincial control of the public domain "would 
 have justified the retention by the Imperial government up 
 to the present time of every acre of Crown Lands in Canada.' 
 'The people of the northwest when they are granted provincial 
 rights . . . are entitled to the control of these lands.' 
 {Sir Robert Borden.) 
 
 3. 'The restitution of the public lands to the Provinces 
 of Alberta and Saskatchewan upon fair terms' was advocated 
 in 1907; the 'just recognition' for the Prairie Provinces 'of their 
 undoubted rights to their public lands and natural resources' 
 in 1911; though by February, 1914, serious and complicated 
 'difficulties . . . have now to be surmounted.' 
 
 4. On December 22, 1913, the three western Premiers 
 had submitted their proposal: 
 
 'that the financial terms already arranged between the 
 ■provinces and the Dominion as compensation for lands 
 'should stand as compensation for lands already alienated 
 'for the general benefit of Canada' ; 
 
 and subsequently urged in its defence 'two fundamental prin- 
 ciples' already conceded, (a) the right of the provinces to the 
 public domain, (b) 'their right to compensation for such por- 
 tions of the same as have been alienated for the general benefit 
 of Canada.' (Premiers Scott, Sifton and N orris.) 
 
 5. The 'Resources Question' was then overshadowed 
 by the war until the Conference of November, 1918, when it 
 was submitted to 'representatives of all the provinces of 
 Canada' in their provincial capacity, with the intimation that 
 'the Government was disposed to give favourable considera- 
 tion . . . provided that it was mutually satisfactory to 
 the other Provinces of the Dominion.' 
 
General Summary 147 
 
 6. A resolution of 'the other Provinces of the Dominion' 
 demanded : 
 
 'that in the event of the special allowances in lieu of 
 'lands . . . being maintained in whole or in part, 
 'a proportionate allowance ... be granted to each 
 "of the other provinces of Confederation — reserving however 
 'any special claim . . . upon any other ground 
 'whatsoever.' 
 
 7. Pending a return to normal federal channels the 'Natur- 
 al Resources Question' would seem to have been consigned to 
 the limbo of inter-provincial controversy whence ghosts of 
 unburied causes seek in vain for deliverance. 
 
 8. Two fragmentary features of the 'Resources Question' 
 challenge attention, (a) the suggestions of 'certain reservations' 
 in connection with the return of the public domain to the 
 Prairie Provinces, and (b) the intervention of other provinces 
 in a purely provincial capacity in the 'Resources Question' of 
 the West. 
 
 9. With regard to the former, any arbitrary 'conditions 
 and restrictions' with regard to lands would amount to a 
 concession of 'the principle that the government do not intend 
 to hand them over.' Instead of the province being 'supreme' 
 over its own public domain 'directly under the Crown as its 
 head,' the Dominion would still be exercising an intolerable 
 'suzerainty'. 
 
 10. The primary functions of the public domain are 
 fiscal. 'Colonists of the Anglo-Saxon race look upon the 
 land revenue as legitimately belonging to the community.' 
 {Colonial Ojffice.) P.E.I, had 'no lands the proceeds of the 
 sale of which could, as in other British Colonies, be appropriated 
 towards local improvements and the maintenance of govern- 
 ment.' (Can. Privy Council.) The 'guiding principle' of 
 Confederation with regard to the public domain was 'that 
 the provinces were entitled to the public lands as a source of 
 revenue to administer to the growing wants of the population 
 in each Province.' (Sir Wilfrid Laurier.) 
 
 11. These normal functions of public lands (exemplified 
 even in this province in 'school lands,' 'swamp lands,' etc.), 
 were denied to Manitoba with regard to millions of acres of 
 some . of the richest lands in North America. The Prairie 
 Provinces are entitled to adequate compensation if the old 
 system is to be continued, and to statutory safeguards in any 
 case ensuring full provincial status without any qualifications 
 whatever. 
 
148 General Summary 
 
 12. The reference of the 'Resources Question' to the 'repre- 
 sentatives of all the provinces' is more difficult to discuss with 
 equanimity because it would seem to leave the fiduciary 
 obligations of the Dominion in administering the public domain 
 of the Prairie Provinces to be determined by the other prov- 
 inces of Canada on the basis of fiscal expediency; and ac- 
 quiescence would 'virtually establish an admission on our part 
 that the other Provinces have a right to share in the beneficial 
 interest in our public domain.' (Premiers Norris, Martin 
 and Stewart.) 
 
 13. 'The Natural Resources Question' is not two questions 
 but one. It is not a question of lands and a question of sub- 
 sidy, but a question of lands as from 1870. The 'Resources 
 Question' is one question and the Federal Government alone 
 must be its prophet. Compensation for alienated lands is 
 thus the equity due to this province in respect of lands as 
 from the assumption of responsible government. 
 
 14. 'The wisdom of these three Prairie Provinces having 
 handed over to them the public lands is a question between the 
 federal Government and the provinces interested and affected. ' 
 {Premier Fleming of New Brunswick.) 'The question of the 
 wisdom of giving the provinces the lands is one between the 
 Dominion Government and the western provinces.' {Premier 
 Murray of Nova Scotia.) 
 
 15. This is a problem not of adjusting subsidies or liquidat- 
 ing provincial claims, but of consummating Confederation. 
 Provincial control of public lands was the cornerstone, the 
 foundation of the 5. A/^. A. Aci of 1867, and the first corollary 
 of responsible government. In this respect Manitoba has been 
 the Cinderella of Confederation ; grudgingly admitted to rights 
 that were elsewhere taken for granted, 'as is done in P.E.I.', 
 as was done in B.C., as was said to obtain in the 'Land States' 
 of the American Union. It would not be amiss to settle 'the 
 Natural Resources Question' upon the merits of the case of 
 this province. 
 
 16. The time has come to right this half-century of vested 
 wrong, and by Imperial statute to make this province like 
 the other provinces of the Dominion, 'supreme' over its own 
 lands 'directly under the Crown as its head.'