Bill C-11

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	SUMMARY
	This enactment provides authority for the disposition of all or substantially all of the assets of the Cape Breton Development Corporation (the ``Corporation'') and provides for the dissolution and winding up of the affairs of the Corporation. The purpose is to enable a private sector operator to acquire the mining assets of the Corporation so that the federal government can exit the coal mining business in Cape Breton and to provide for the continuation of the existing jurisdictional regimes for labour relations, occupational safety and health, and labour standards. Consequential amendments are proposed to the existing legislation to remove provisions that are no longer applicable, to provide for a reduced board of directors in the future, and to permit legal actions to be brought against the Crown.
	EXPLANATORY NOTES
	Cape Breton Development Corporation Act
	Clause 6: (1) The definitions ``Coal Division'' and ``companies'' in section 2 read as follows:
	``Coal Division'' means the Coal Division of the Corporation, established by section 8;
	``companies'' means all or any of Dominion Coal Company, Limited, Nova Scotia Steel and Coal Company, Limited, The Dominion Rolling Stock Company Limited, Sydney and Louisburg Railway Company, The Scotia Rolling Stock Company Limited and The Cumberland Railway Company;
	(2) The definition ``Chairman'' in section 2 reads as follows:
	``Chairman'' means the Chairman of the Board;
	(3) New.
	Clause 7: Section 3 reads as follows:
	3. A corporation is hereby established to be called the Cape Breton Development Corporation, consisting of a Board of Directors comprised of a Chairman, a President and five other directors to be appointed in the manner provided in section 4.
	Clause 8: Section 4 reads as follows:
	4. (1) The Chairman and the President shall each be appointed by the Governor in Council, after consultation with the Lieutenant Governor in Council of Nova Scotia, to hold office during pleasure for such term as the Governor in Council considers appropriate.
	(2) Each director, other than the Chairman and the President, shall be appointed by the Minister, with the approval of the Governor in Council, to hold office during pleasure for such term, not exceeding three years, as will ensure, as far as possible, the expiration in any one year of the terms of office of not more than one-half of the directors.
	(3) Two directors other than the Chairman and the President shall be appointed on the recommendation of the Lieutenant Governor in Council of Nova Scotia.
	(4) Subject to subsection (5), the President is eligible for re-appointment on the expiration of his term of office, but any other director who has served two consecutive terms is not, during the twelve months following the completion of that director's second term, eligible for appointment except as President.
	(5) A director ceases to be a director of the Corporation on attaining the age of seventy years.
	(6) A vacancy on the Board does not impair the right of the remaining directors to act but where any such vacancy occurs it shall be filled as soon as practicable by appointment in the manner provided in this section.
	Clause 9: Section 5 reads as follows:
	5. The Chairman shall preside at meetings of the Board but in the event of the absence or incapacity of the Chairman, or if the office of Chairman is vacant, the President shall preside at those meetings.
	Clause 10: Subsection 7(1) reads as follows:
	7. (1) The President shall be paid by the Corporation a salary to be fixed by the Governor in Council and the Chairman and the other directors other than the President shall be paid by the Corporation such fees for attendances at meetings of the Board or any committee thereof as are fixed by the Governor in Council.
	Clause 11: Sections 8 to 14 read as follows:
	8. (1) There shall be established within the Corporation for the more efficient management and conduct of the activities thereof, a division of the Corporation to be known as the Coal Division, which shall be under the management of a vice-president of the Corporation to be appointed in the manner provided in subsection (2) and such other divisions, if any, as the Board deems appropriate.
	(2) The Board, on the recommendation of the President, shall appoint a vice-president of the Corporation who shall be responsible to the President for the management of the Coal Division.
	(3) The Corporation may employ such other officers and such employees and technical and professional advisers as it considers necessary for the proper conduct of its activities.
	(4) The vice-president of the Corporation appointed pursuant to subsection (2) and the persons employed pursuant to subsection (3) shall be paid by the Corporation such remuneration as is fixed or provided for by the Board and shall be employed on such terms and conditions as are fixed or provided for by by-law of the Corporation.
	(5) The vice-president appointed pursuant to subsection (2) may attend any meetings of the Board or of a committee thereof.
	INITIAL ACQUISITION OF PROPERTY
	9. (1) For the purpose of enabling the Corporation to carry out its objects under this Act, the Corporation is empowered to acquire
	(a) all or any part of the lands and personal property located on the Island of Cape Breton in the Province of Nova Scotia, other than the line of railway operated by the companies between Broughton Junction and Louisburg, and
	(b) all interests of the companies in lands and all personal property located under waters adjacent to the Island of Cape Breton,
	that constituted or formed part of the works and undertakings operated or carried on by the companies on or after June 15, 1967.
	(2) The acquisitions referred to in subsection (1) may be made
	(a) by purchase for such consideration and on such terms as the Corporation and the owner thereof may agree on, but no agreement entered into under this paragraph has any force or effect unless approved by the Governor in Council;
	(b) by purchase for a consideration and on terms to be established in such manner, other than by agreement, as the Corporation and the owner thereof may agree on; or
	(c) by expropriation in the manner provided in section 10.
	10. (1) The Corporation may, for the purpose of exercising the power conferred on it by paragraph 9(2)(c),
	(a) deposit in the office of the Registrar of Deeds for the registration district of the County of Cape Breton in the Province of Nova Scotia a plan of the lands or any part thereof that the Corporation is empowered to acquire pursuant to section 9; and
	(b) register with the Registrar General of Canada an inventory of the personal property or any part thereof that the Corporation is empowered to acquire pursuant to that section.
	(2) On publication in the Canada Gazette of a notice that the plan described in paragraph (1)(a) and the inventory described in paragraph (1)(b) have been respectively deposited and registered in the manner provided in those paragraphs,
	(a) all interests, other than of Her Majesty in right of Nova Scotia, in the lands on the Island of Cape Breton in the Province of Nova Scotia depicted on the plan as being taken by the Corporation,
	(b) all interests of the companies in lands located under waters adjacent to the Island of Cape Breton depicted on the plan as being taken by the Corporation, and
	(c) all rights, other than those of Her Majesty in right of Nova Scotia, in the personal property described in the inventory,
	shall vest in the Corporation, free from any and all encumbrances, by virtue of this Act and without further assurance.
	(3) A plan deposited in accordance with paragraph (1)(a) and an inventory registered in accordance with paragraph (1)(b) shall be signed by the President and a copy of the plan and the inventory shall, not later than the day of publication in accordance with subsection (2) of notice of the deposit and registration, be sent by registered mail addressed to Dominion Steel and Coal Corporation, Limited at its head office address as then known to the Corporation.
	11. (1) For the purposes of this Act, the definition ``land'' in the Expropriation Act shall be deemed to include personal property as though personal property were an interest in land and, except as otherwise provided in this Act, all the provisions of the Expropriation Act are, with such modifications as the circumstances require, applicable to the taking or abandonment by the Corporation of any property taken in the manner provided in section 10.
	(2) All claims against the Corporation for compensation for property taken in the manner provided in section 10 shall be heard and determined in the Federal Court.
	(3) The compensation money, if any, payable for property taken in the manner provided in section 10 shall be allocated in the first instance among the persons, other than the companies and any corporations associated with the companies within the meaning of the Income Tax Act, having a claim to that money by virtue of section 25 of the Expropriation Act, and in the second instance and to the extent of the balance, if any then remaining, among the companies and any associated corporations having such a claim, and subject to subsection 12(3) any payment of that money pursuant to paragraph 19(1)(b) shall be made accordingly.
	12. (1) The amount of the consideration or compensation payable for property, other than stocks of coal, acquired pursuant to section 9, whether in the manner provided in section 10 or otherwise, shall be established or determined as the fair market value, if any, of that property without any allowances in addition thereto whatever, and in determining that value,
	(a) it shall be assumed that all subsidies, subventions and other financial assistance provided under the authority of Parliament directly or indirectly to or for the benefit of the companies or for which under that authority the companies were eligible prior to the day the property was so acquired, were terminated on June 15, 1967 and thereafter remained terminated absolutely; and
	(b) any enhancement in value of the property that is attributable in whole or in part to the use of machinery or equipment leased to the companies by the Dominion Coal Board after April 1, 1967 shall not be taken into consideration.
	(2) Stocks of coal, if any, acquired by the Corporation shall be valued at the cost thereof to the companies.
	(3) There shall be deducted from the amount of the consideration or compensation, if any, payable to the companies and any corporations associated with the companies within the meaning of the Income Tax Act for property acquired pursuant to section 9, whether in the manner provided in section 10 or otherwise, the outstanding balance of principal moneys, together with accrued interest thereon, owing to Her Majesty pursuant to an agreement dated March 14, 1950 made between Dominion Coal Company, Limited and His Majesty the King in right of Canada, as amended.
	13. No consideration or compensation is payable for any tangible personal property acquired pursuant to section 9, whether in the manner provided in section 10 or otherwise, unless the person claiming to be entitled thereto establishes that actual physical possession of the property has been delivered to the Corporation.
	14. Any person or persons designated in writing by the President shall have free and unimpeded access at all times to each and every part of the works and undertakings of the companies and, without limiting the generality of the foregoing, may survey and take levels of the property of the companies and inspect all books, minutes, reports, documents, records, inventories, chattels, papers, things and properties of the companies, and all reasonable aid and assistance shall, on request, be rendered to any such person or persons by the boards of directors, officers and employees of the companies, including aid and assistance in the making and giving of extracts, copies and statements.
	Clause 12: The headings before section 15 and sections 15 to 17 read as follows:
	COAL DIVISION
	Objects, Powers and Duties
	15. The objects of the Corporation in relation to the Coal Division are to reorganize and rehabilitate the coal mining and related works and undertakings that were operated or carried on by the companies on Cape Breton Island prior to the acquisition of property by the Corporation pursuant to section 9 and to conduct coal mining and related operations in the Sydney coal-field on a basis that is consistent with efficient mining practice and good mine safety and with the overall plan, or any modification thereof, submitted by the Corporation pursuant to section 17.
	16. In carrying out its objects in relation to the Coal Division, the Corporation may
	(a) by agreement with any party to a contract for the sale or delivery of coal by or on behalf of Dominion Coal Company, Limited that was in force at the time of acquisition of property by the Corporation pursuant to section 9, assume all rights and obligations of Dominion Coal Company, Limited under the contract;
	(b) rehabilitate, improve, open, operate and maintain any coal mines or related fixtures, machinery, equipment or property of any other nature acquired by the Corporation;
	(c) enter into contracts with any person or persons within or outside Canada or with Her Majesty in right of Canada or any province or any agent of Her Majesty in right of Canada or any province relating to the production of coal by the Corporation or to the marketing and shipping of coal acquired by or produced by the Corporation; and
	(d) do all such other things as the Corporation deems incidental or conducive to the attainment of its objects in relation to the Coal Division.
	17. (1) The Corporation shall, not later than October 1, 1968, submit to the Minister for the approval of the Governor in Council an overall plan for the conduct of coal mining and related operations by the Corporation in an efficient manner and for the progressive reduction of coal production by the Corporation and discontinuation of coal production from mines that are not economically viable, and the plan shall take into account progress in providing employment outside the coal producing industry and in broadening the base of the economy of Cape Breton Island.
	(2) Any material modification of the plan referred to in subsection (1) that the Corporation considers desirable or expedient shall be submitted to the Minister for the approval of the Governor in Council.
	(3) A copy of the plan and of any material modification thereof prepared by the Corporation pursuant to this section shall be presented by the Corporation to the Lieutenant Governor in Council of Nova Scotia.
	(4) Before closing or substantially reducing the production of coal from any coal mine operated by it, the Corporation shall ensure that
	(a) the closing or substantial reduction in production is in accor dance with and at a time provided for in the overall plan or any modification thereof submitted pursuant to this section; and
	(b) all reasonable measures have been adopted by the Corporation, either alone or in conjunction with the Government of Canada or of Nova Scotia or any agency of either of those governments, to reduce as far as possible any unemployment or economic hardship that can be expected to result from the closing or reduction in production.
	Clause 13: Sections 18 to 21 read as follows:
	18. (1) The Corporation shall by by-law provide
	(a) for the establishment, management and administration of
	(i) pension arrangements for the benefit of persons, and dependants of persons, employed by the Corporation in connection with the coal mining and related works and undertakings operated or carried on by the Corporation, and
	(ii) pension arrangements for the benefit of persons, and dependants of persons, formerly employed by the companies in connection with the coal mining and related works and undertakings formerly operated or carried on by the companies, if those persons were, prior to the acquisition of property by the Corporation pursuant to section 9, in receipt of a periodic payment from the companies or Her Majesty in right of Nova Scotia in recognition of their former employment in connection with those works and undertakings;
	(b) for the contributions thereto to be made by the Corporation out of moneys administered by the Corporation for the operation of the Coal Division; and
	(c) for the investment of any pension fund moneys thereof.
	(2) A by-law made pursuant to subsection (1) shall provide for the payment of an immediate lump sum or other benefit to a person described in that subsection who is or was laid off or retired at an age that is earlier than the normal retirement age provided for by the by-law if the lay-off or retirement resulted from the reorganization and rehabilitation by the Corporation of the coal mining and related works and undertakings referred to in section 15 or from the conduct of coal mining and related operations by the Corporation on a basis that is consistent with the overall plan, or any modification thereof, submitted by the Corporation pursuant to section 17.
	(3) No by-law made under this section has any effect unless it has been approved by the Treasury Board.
	Financial Provisions
	19. (1) The Minister of Finance shall out of the Consolidated Revenue Fund, on the requisition of the Corporation and the Minister, cause to be paid to any person entitled thereto
	(a) the amount of any consideration for land or personal property acquired by the Corporation that is agreed to be payable under any agreement entered into pursuant to paragraph 9(2)(a) or that is established to be payable in a manner agreed on by the Corporation and the owner of the land or personal property pursuant to paragraph 9(2)(b); or
	(b) the amount of any compensation for land or personal property taken in the manner provided in section 10, and where the amount of the compensation is fixed by a judgment pursuant to this Act, the amount of any costs awarded to that person.
	(2) The Minister of Finance shall out of the Consolidated Revenue Fund, on the requisition of the Corporation and the Minister, in accordance with approved budgets of the Corporation, cause to be paid to the Corporation from time to time as required by it amounts not exceeding in the aggregate twenty-five million dollars for the purposes of reorganizing and rehabilitating the coal mining and related works and undertakings referred to in section 15 and for preparatory work in connection with the conduct by the Corporation of coal mining and related operations.
	(3) The Minister of Finance may, out of the Consolidated Revenue Fund, on the requisition of the Corporation and the Minister, authorize advances from time to time to the Corporation, on such terms as may be agreed on, for working capital for the Coal Division, but the total amount of advances outstanding at any time under this subsection shall not exceed fifty million dollars or such other amount as may be established by an appropriation Act or other Act of Parliament.
	20. (1) The Corporation shall maintain in the name of Cape Breton Development Corporation, Coal Division, one or more accounts in the Bank of Canada or in one or more banks designated by the Minister of Finance.
	(2) All moneys received by the Corporation through the conduct of the operations of the Coal Division or otherwise on behalf of or to the credit of the Coal Division shall be deposited to the credit of the accounts established pursuant to subsection (1) and shall be administered and expended by the Corporation exclusively in the exercise of the powers and performance of the duties and functions of the Corporation in relation to the Coal Division.
	(3) The Corporation may invest any moneys administered by it pursuant to this section in obligations of or guaranteed by the Government of Canada.
	(4) The Corporation shall, in relation to the operations of the Coal Division, keep proper books of account and records related thereto.
	(5) The Corporation shall prepare separate financial statements in relation to the operations of the Coal Division.
	21. If the Corporation is required to submit an operating budget or capital budget pursuant to section 123 or 124 of the Financial Administration Act, it shall prepare that budget separately in relation to the Coal Division.
	Clause 14: Sections 26 and 27 read as follows:
	26. (1) If the Corporation is required to submit an operating budget or capital budget pursuant to section 123 or 124 of the Financial Administration Act, it shall prepare that budget separately in relation to the Industrial Development Division.
	(2) [Repealed]
	General
	27. The head office of the Corporation shall be at Sydney, Nova Scotia, but meetings of the Board may be held in such other places in Canada as the directors may decide.
	Clause 15: The relevant portion of section 28 reads as follows:
	28. The Board may make by-laws
	. . .
	(e) respecting the establishment, management and administration of a pension fund for the President, the officers and employees of the Corporation and dependants of those persons, other than those for whom provision is made by any by-law made pursuant to section 18, the contributions thereto to be made by the Corporation and the investment of the pension fund moneys thereof; and
	Clause 16: Subsection 30(1) reads as follows:
	30. (1) Persons employed by the Corporation pursuant to subsection 8(3) are not officers or servants of Her Majesty.
	Clause 17: Sections 33 to 35 read as follows:
	33. (1) The Corporation shall submit a copy of each annual report of the Corporation prepared in accordance with section 150 of the Financial Administration Act to the Lieutenant Governor in Council of Nova Scotia.
	(2) [Repealed]
	34. The Corporation shall wind up its affairs and dispose of its assets and liabilities within such time after the discontinuation of coal production by the Corporation from mines that are not economically viable in accordance with the overall plan or any modification thereof submitted pursuant to section 17 and in such manner and subject to such conditions as the Governor in Council, after consultation with the Lieutenant Governor in Council of Nova Scotia, may prescribe.
	35. The works and undertakings operated or carried on by the companies on or after June 15, 1967, located on the Island of Cape Breton in the Province of Nova Scotia or under waters adjacent to the Island, other than the line of railway operated by the companies between Broughton Junction and Louisburg, are hereby declared to be works for the general advantage of Canada.