Lord Shaw:-

This appeal is brought from a judgment of the Court of Appeal of British Columbia, dated 4th April 1916, dismissing an appeal by the appellants against the judgment of Murphy, J. dated 29th June 1915.

The respondents, the corporation of the district of North Vancouver, are a municipality incorporated under the Municipal Act of the province of British Columbia. On 16th August 1905, they entered into an agreement with the appellants, the Vancouver Power Company, Limited granting to the latter power for the construction maintenance and operation, within the limits of the district, of all the works, power-houses, buildings, poles and wires required "for the generation, distribution, and sale of electricity for light, heat and power and any other purpose". By clause 11 of that agreement a monopoly or exclusive right was granted to the company.

By the same clause 11 however, it was also provided :-

"But at the expiration of ten years from the said date of this agreement the corporation may, upon giving at least twelve months prior notice in writing of its intention to do so assume the ownership of the electric lighting system within the limits of the district, together with all the real and personal property of the company used, in use, or to be used in the operation of the lighting system within the limits aforesaid, upon payment being made by the Corporation to the company of the value of the said lighting system as a going concern, but not including any payment for good will".

On 13th May, 1907 a portion of the district municipality described in schedule B to C. 35 of the Acts of British Columbia, 1906, was incorporated as the city of North Vancouver. The provisions of that Act will be presently referred to. On 14th August 1914, the respondents, the corporation of the district gave notice of their intention in terms of clause 11 of the agreement to assume the ownership of the electric lighting system. No objection is taken to the form of this notice, and it is, of course, admitted that it was given in time.

The proceedings out of which the present appeal arises were by way of special case; and the action was begun on 14th June, 1915. The facts are set out in the case and the question for decision is formulated as follows :

"Whether the plaintiff by reason of having given the said notice of intention to purchase is entitled at the expiration of ten years from 16th August 1905, to assume ownership of the electric lighting system of the defendant, situate within the area comprising the city of North Vancouver and within the area comprising the district of North Vancouver, together with all the real and personal property of the defendent used, in use or to be used in the operation of the said lighting system within the said areas upon payment therefor in the manner provided in the said agreement".

That question was answered by both Courts in the affirmative, and their Lordships are of opinion that that answer was correct.

The appellants, the Vancouver Power Company, present an argument to the effect that the notice is invalid in consequence principally of the city of North Vancouver having been carved out of the district as already stated. Part of the company's operations and plant are within the city; part extends beyond the city bounds and into other portions of the district. So far as practical working is concerned, the incorporation of the city as a separate municipality seems to have imported no change in the working of the system of the appellants as a unity, a unity which covers territory both within and beyond the city. Under these circumstances one could have imagined a strong objection being formulated to any attempt by a separate city notice-applicable only within the city bounds - to terminate the agreement for the city itself, thus splitting up the ownership of the concern and producing in all likelihood an unworkable business result. The present objection, however is to a notice which has been given exactly in terms