Proceedings of the Standing Senate Committee on
Social Affairs,
Science and Technology
Issue 21 - Evidence, December 2, 1998
OTTAWA, Wednesday, December 2, 1998
The Standing Senate Committee on Social Affairs, Science and Technology, to which was referred Bill S-20, to amend the Act of incorporation of the Roman Catholic Episcopal Corporation of Mackenzie, met this day at 3:40 p.m. to give consideration to the bill.
Senator Lowell Murray (Chairman) in the Chair.
[English]
The Chairman: Honourable senators, we have before us today Bill S-20, which was sponsored by Senator Taylor, who I think inherited it from our late and lamented colleague, Senator Walter Twinn. Bill S-20 received second reading a while back in the Senate. This act of incorporation, which this bill seeks to amend, was passed by Parliament in 1913 and has not been amended in the interim.
Our witness today, Mr. Bernard Lavallée, is the legal counsel for the Roman Catholic Episcopal Corporation of Mackenzie.
[Translation]
He was born on January 1, 1939 in Westlock, Alberta, a community located 30 miles north of Edmonton. He attended the University of Ottawa and graduated in 1959 with a bachelor's degree.
[English]
He received his Bachelor of Laws degree in 1963 from the University of Alberta.
[Translation]
He has been practising law there since 1964.
[English]
He is, as I said, a Queen's Counsel. He has been a director of l'Association canadienne-française de l'Alberta, the Junior Chamber of Commerce, of Edmonton, and CHFA Radio, of Edmonton. He is senior partner in his law firm.
He is here because we do not pass private bills of this kind without hearing from the petitioner or the petitioner's counsel. In particular, our rules require that he prove the preamble of Bill S-20; that is, he must present facts as to why this bill should be passed.
Let me also say that no other witnesses have contacted the Law Clerk seeking to appear in objection to the bill.
With that preamble, Mr. Lavallée, je vous donne la parole.
Mr. Bernard Lavallée, Q.C., Legal Counsel for the Mackenzie Diocese for the Roman Catholic Episcopal Corporation of Mackenzie: Thank you, Mr. Chairman. Let me say, first of all, honourable senators, that I adopt the statements made in the motion that is before the committee as being factual, and as witness to the inquiry I give evidence that they are factual.
The reason this comes before you is because of the 1913 legislation, which limited the investment powers of the Roman Catholic Episcopal Corporation of Mackenzie. I will give you an example.
Section 4(2) of the act provides that:
The annual value of the real estate held by or in trust for the Corporation$shall not exceed fifty thousand dollars.
Ladies and gentlemen, in the balance sheet before me, which I can produce as an exhibit to these proceedings, the value of the real estate holdings is in excess of $3,551,000. That is in the financial statement, which basically shows the depreciated cost of real estate holdings. Their value is, of course, much higher than that.
For insurance purposes, for example, the value of those real estate holdings is in the neighbourhood of $14 million. It was not until April 1996 that Bishop Denis Croteau became aware of the restrictions in the holdings of the diocese. A new accountant went back to square one, namely, to the enabling legislation that created this corporation, and there noticed this particular restriction on its powers, that the annual value of the real estate holdings shall not exceed $50,000.
Shortly after learning of this, we were instructed to take the necessary steps to ask the Senate, and eventually the House of Commons, to remove this particular restriction on the investment powers of the corporation, and that is one of the things we are asking of you today.
It may very well be that in 1913 the restriction was sensible and appropriate. However, in the decades since that time the corporation has invested wisely and received considerable support from various benefactors. For example, last year's financial statement shows the operating budget of the diocese to be close to $1.5 million. Of that amount, $800,000 is received from cash that it has invested. Of the remaining $700,000, $150,000 to $200,000 is provided by the Catholic Church. Notwithstanding that operating budget -- the funds of which go strictly towards native education, native schools, hospitals, churches, missions -- last year they suffered a loss of $200,000, over and above their investments and properties.
The corporation operates in the north, and in Saskatchewan, and in a small part of Alberta. In the north, the area the corporation covers is larger than the province of Quebec. One cannot imagine the distances they must travel in the north and the expenses they must incur to visit their various missions and churches, from Tuktoyaktuk to Yellowknife, where they minister to the native people, which is the goal of this episcopal corporation.
It is, of course, obvious that they minister almost exclusively to people of very modest circumstances and rely on outside support, which unfortunately has become limited because of the limited resources both of government and the Catholic Church.
I am told that just outside Yellowknife, at a place called Trappers Lake, there is a facility worth in excess of $1 million. That is just one example of why we are here today. We do not want to be operating outside the law; we want to be operating within the law.
I asked my investment counsellor at CIBC Wood Gundy the difference in value between $50,000 in 1913 and 1998. He advised me that if it were valued on the basis of the consumer price index, which I am told started in 1914, it would be worth $5,057,500 in today's dollars. I am also told that this is the lowest factor in this country for determining growth. If we were to talk in terms of T-bills, the $50,000 could be as much as a hundred times its 1913 value. If the indicia of the stock market were to be used, it could be even more. All of this is to say that $50,000 in 1913 dollars, as you can see, simply makes it impossible for us to operate 38 parishes and missions across the north, an area the size of Quebec.
The Chairman: Thank you very much, Mr. Lavallée. That is very helpful.
Honourable senators, are there any questions?
[Translation]
Senator Lavoie-Roux: Historically, the Government of Canada has had to approve the establishment of dioceses. Is that also true of other corporations? This surprised me a great deal. I did not know that the federal government had a say in the establishment of Catholic dioceses in Canada.
Mr. Lavallée: Dioceses are established under ecclesiastical law. When this legislation was enacted in 1913, this corporation was a vicariat. The 1913 legislation recognized the authority of the bishop. It stated the following:
[English]
Section 13 of the act says, in part, that whenever the vicariat, or any part thereof, is erected into a diocese -- and it was erected into a diocese in March 1968. However, in answer to your question, it is under ecclesiastical law that that was designated, not under the Parliament of Canada.
[Translation]
Senator Lavoie-Roux: Are there other corporations in Canada in a situation similar to yours?
Mr. Lavallée: Several years ago, the Anglican Church of Canada encountered a somewhat similar problem regarding its investment powers. In that instance, the 1936 legislation incorporating the Bishop of the Arctic of the Anglican Church limited the investment powers of the Corporation to certain trusts in Great Britain. An amendment similar to the one we are seeking was approved, granting much broader investment powers to the church. There are precedents.
The Chairman: Our parliamentary law clerk has just pointed out to me that the Archbishop of Ottawa was incorporated by the federal government.
Senator Lavoie-Roux: That is ridiculous.
The Chairman: No, it is not. That is in keeping with the law.
Mr. Lavallée: A vicariat or diocese is established under ecclesiastical law. According to ecclesiastical theory, once a diocese has been incorporated, in whom is the power to have real estate holdings vested? Who has the legal authority to enter into contracts? The Parliament of Canada, through this legislation, establishes a corporate entity to enter into contracts, own land, buy and sell goods and hire employees.
Senator Lavoie-Roux: Are all dioceses in the same situation?
The Chairman: From a provincial standpoint, yes.
Ms Nadine S. Huggins, Acting Clerk of the Committee: There are many in the same situation. This is certainly not a unique example.
Senator Lavoie-Roux: I was not aware of that.
[English]
The Chairman: Is it agreed, honourable senators, that the committee now move to clause-by-clause consideration of Bill S-20?
Hon. Senators: Agreed.
The Chairman: Honourable senators, shall consideration of the title be postponed?
Hon. Senators: Agreed.
The Chairman: Shall consideration of the preamble be postponed?
Hon. Senators: Agreed.
The Chairman: Honourable senators, I have a letter from our Law Clerk advising me that the bill needs to be amended to accommodate an ecclesiastical change to the English name of the corporation, an amendment that came to the attention of the petitioner's counsel after the advertising for the bill had already been completed.
The sole purpose of the amendments, and there will be three of them to give effect to this, is to add the words "Fort Smith" to the name of the corporation wherever it appears, making the new name "Roman Catholic Episcopal Corporation of Mackenzie-Fort Smith".
Having said that, shall clause 1 carry, honourable senators?
Senator Mahovlich: Honourable senators, I move:
That Bill S-20 be amended in clause 1, on page 1,
(a) by replacing line 27 with the following:
"1: The long title"; and
(b) by replacing lines 30 to 32 with the following:
"An Act to incorporate the Roman Catholic Episcopal Corporation of Mackenzie-Fort Smith".
The Chairman: Honourable senators, you have heard the motion. Is there any discussion on the amendment?
If not, shall clause 1, as amended, carry?
Hon. Senators: Agreed.
The Chairman: Carried.
Honourable senators, shall clause 2 carry?
Senator Mahovlich: Honourable senators, I move:
That Bill S-20 be amended in clause 2, on page 2,
(a) by replacing line 1 with the following:
Shall I dispense?
Hon. Senators: Yes.
The Chairman: Is it your pleasure, honourable senators, to adopt the said amendment?
Hon. Senators: Agreed.
The Chairman: Honourable senators, shall clause 2, as amended, carry?
Hon. Senators: Agreed.
The Chairman: Carried.
Honourable senators, shall clause 3 carry?
Hon. Senators: Agreed.
The Chairman: Carried.
Honourable senators, shall clause 4 carry?
Hon. Senators: Agreed.
The Chairman: Shall the preamble of the bill carry?
Senator Mahovlich: Honourable senators, I move:
That the preamble in Bill S-20 be amended on page 1 by replacing line 9 with the following:
"of Mackenzie was erected the Diocese of Mackenzie-Fort Smith by".
The Chairman: Is it your pleasure, honourable senators, to adopt the said amendment?
Hon. Senators: Agreed.
The Chairman: Carried.
Shall the preamble, as amended, carry?
Hon. Senators: Agreed.
The Chairman: Carried.
Honourable senators, shall the title carry?
Hon. Senators: Agreed.
The Chairman: Carried.
Mr. Audcent, is there any legal reason why this bill should not be adopted?
Mr. Mark Audcent, Law Clerk and Parliamentary Counsel, Senator of Canada: Mr. Chairman, I am pleased to advise that Bill S-20 is in good legislative form and will carry out the petitioner's intention.
The Chairman: Thank you, Mr. Audcent.
Honourable senators, is it agreed that this bill be adopted, as amended?
Hon. Senators: Agreed.
The Chairman: Carried.
Honourable senators, is it agreed that I report this bill, as amended, to the Senate?
Hon. Senators: Agreed.
The Chairman: Thank you, honourable senators. Thank you, Mr. Lavallée.
The committee adjourned.