Lord Atkinson :-

This is an appeal from the judgment of the Court of Appeal of British Columbia, dated 15th September, 1920, allowing an appeal from the judgment, dated 28th November, 1919 of the trial judge, Macdonald, J., by which latter judgment the respondent's action was dismissed and the appellants given judgment on their counterclaim.

The action out of which the appeal has arisen was brought by the Bishop of Vancouver Island, who by the Statute of British Columbia, 1892, Clause 56, is created a corporation sole, against the Corporation of the City of Victoria, claiming, in the first place, a declaration that no rates or taxes had been lawfully imposed upon certain lands, belonging to him by virtue of his office, upon which lands there had been at all material times erected a building known as St. Andrew's Cathedral dedicated and set apart and in constant use for the public worship of God; and in the second place, an injunction restraining the defendants and their collector of taxes from offering for sale for taxes the aforesaid lands upon which the said cathedral had been erected or any part thereof on 26th May, 1919, or any other date; and thirdly general relief. To this statement of claim the defendants filed a lengthy defence, setting forth the provisions of many statutes, which they alleged conferred upon them the power under the conditions above mentioned, to tax the aforesaid lands upon which the said cathedral stands (lots 9, 10 and 11, block 12) in the City of Victoria, also other provisions which it was alleged barred the plaintiff's right to obtain the relief claimed, and averring that there was due in respect of these lands for general rates and taxes and also for local improvement rates and taxes, together a sum of $ 15,934.44, for which they counter-claimed. To this defence the plaintiff filed a reply, and to the defendant's counter-claim a defence; to which latter again the defendants filed a reply.

Notwithstanding the voluminous character of these pleadings two questions alone emerge for decision on this appeal, The first and main question is whether by the provisions of Section 197 of the Municipal Act, Clause 52, of the Statutes of British Columbia, 1914 (hereafter referred to as "the Act of 1914"), the land upon which the fabric of St. Andrew's Cathedral stands is exempted from liability for all rates and taxes as completely as the fabric itself is admitted to be.

The second and subsidiary question is whether, even if the said lands are not by these provisions so exempted, yet in the events which have happened the general and local rates and taxes in fact assessed upon the said lands for the years 1914 to 1918 both inclusive, amounting to the aforesaid sum of $ 15,934.44, are due and recoverable by the Corporation under their counter-claim. This latter question though raised in the pleadings is not alluded to in the judgment delivered by the learned judges who decided the appeal; but counsel assure their Lordships it was argued and, of course, they accept that assurance.

Section 197 of the Act of 1914, upon which the main question turns, headed "Taxes on Land or Improvements" runs as follows :

"197. Rates and taxes may be settled, imposed, and levied upon land or upon real property or upon improvements within a municipality by the Council thereof, subject to the following exemptions, that is to say : (1) Every building set apart and in use for the public worship of God: (2) Every burying ground in actual use solely as such, and every cemetery: (3) Every building set apart and in use solely as a hospital in which the sick, injured, infirm or aged are deceived, treated, or maintained, and the land adjoining thereto and actually used therewith, not, however, exceeding 20 acres in case of a public hospital and three acres in case of a private hospital: (4) All property vested in or held by His Majesty, or vested in any public body or body corporate, officer or person, in trust for His Majesty, or for the public