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Anna Elisabeth Beukenkamp, Adriaan Beuken- kamp, Johanna Alida Beukenkamp, Paul Anton Beukenkamp, Marina Beukenkamp, Janna Nien- huys, Louwrens Jacobus Beukenkamp, and Rad- boud Lourens Beukenkamp (Claimants)
v.
The Minister of Consumer and Corporate Affairs as Custodian of Enemy Property (Respondent)
Trial Division, Heald J.—Toronto, November 26, 27 and 28; Ottawa, December 10, 1973.
Practice—Evidence—Enemy alien property—Treaty of Peace (Germany) Order, 1920—Company shares of neutral vested in Custodian—Photocopy of purchase order— Admissibility in evidence—Delivery of shares not proved— General practice in Stockbroker's Society—Probability of delivery within four days of sale—Affidavit evidence—Treaty of Peace (Germany) Order, 1920, ss. 39, 41.
The claimants are heirs at law of Adriaan Beukenkamp, deceased, and are entitled to continue proceedings (see [1970] Ex.C.R. 158) commenced by the said Adriaan Beu- kenkamp for the return of 145 shares of Canadian Pacific Railway capital stock that were purchased by him on July 20, 1914 through the Amsterdam Stock Exchange. The shares were purchased from German nationals and by virtue of a general Vesting Order of the Quebec Superior Court dated April 23, 1919, (made under Consolidated Orders respecting trading with the Enemy dated May 2, 1916) were vested in the Custodian of Enemy Property.
The claimants say that by virtue of the Treaty of Peace (Germany) Order, 1920, they are entitled to have the shares relinquished to them by the Custodian of Enemy Property, or if the shares were sold, they are entitled to the proceeds of such sale and all rights, dividends and interest in addition thereto. A photocopy of the purchase note dated July 20, 1914 was submitted and, although delivery was not proved, Commission evidence of the stockbroker, now deceased, was tendered regarding the general practice in the Stock broker's Society in Amsterdam of delivery within four days of the sale of the shares. Therefore delivery would have occurred presumably before the outbreak of the war, i.e., on August 4, 1914. Also tendered in evidence was an affidavit of an accountant, now deceased, of the Canadian Bank of Commerce as to a number of share certificates received from Mr. Beukenkamp covering the 145 shares of the Canadian Pacific Railway Company.
The respondent attacked the credibility of the stock broker's evidence and further submitted evidence regarding the broker's handwriting on forms completed in 1923 to be compared with the handwriting on the photocopy of the purchase order.
Held, that the claimants are entitled to succeed under section 41 of the Treaty of Peace (Germany) Order, 1920. The photocopy of the purchase note is admissible in that the evidence of the stockbroker proved that there was an origi nal purchase note which he wrote out himself and signed and that the photocopy was a true copy thereof and that a diligent search had been conducted to find the original. Also the evidence of the stockbroker was sufficient to prove delivery of the shares within a few days of purchase so as to bring the claimants squarely within the provisions of section 41 of the Treaty of Peace (Germany) Order, 1920, and therefore entitled to succeed. The evidence tendered by the respondent was not admissible because there was no evi dence proving the existence of the original documents, the identity of their maker, that a search had been made for the originals and that the copies were in fact true copies of the original.
ACTION. COUNSEL:
P. Genest, Q.C., and K. Crompton for claimants.
D. H. Aylen, Q.C., and P. T. Mclnenly for respondent.
SOLICITORS:
Cassels and Brock, Toronto, for claimants.
Deputy Attorney General of Canada for respondent.
HEALD J.—The claimants, Janna Nienhuys, Louwrens Jacobus Beukenkamp and Radboud Lourens Beukenkamp, are the children, heirs and next-of-kin of Adriaan Beukenkamp, late of the City of Bloomendaal, in the Kingdom of the Netherlands, who died on or about December 4. 1953, intestate, after having commenced these proceedings. These claimants together with Marinus Gerhardus Beukenkamp, the other child of Adriaan Beukenkamp were substituted as claimants herein for the said Adriaan Beu- kenkamp, pursuant to the Order of Mr. Justice Thurlow dated February 3, 1970.
The claimant, Anna Elisabeth Beukenkamp, is the widow of Marinus Gerhardus Beukenkamp above referred to, late of the City of Amster- dam, in the Kingdom of the Netherlands, who died on or about September 10, 1971. The claimants, Adriaan Beukenkamp, Johanna Alida
Beukenkamp, Paul Anton Beukenkamp and Marina Beukenkamp, are the only children of Marinus Gerhardus Beukenkamp, deceased. The widow and the children are substituted as claimants herein for the said Marinus Gerhardus Beukenkamp pursuant to the Order of Associate Chief Justice Noël on February 12, 1973.
The claimants allege that, on or about July 20, 1914, Adriaan Beukenkamp, now deceased, purchased 145 shares of Canadian Pacific Rail way capital stock through the Amsterdam Stock Exchange; that 15 share certificates covering the said 145 shares were, in the ordinary course of business, subsequent to July 20, 1914 and prior to August 4, 1914 (the date of the out break of World War I) delivered to the said Adriaan Beukenkamp, said certificates being in street form endorsed in blank by the previous registered owners of said shares. There is the further allegation that although the previous reg istered owners were German institutions, they had no title, interest or property in said shares after July 20, 1914, the day on which all prop erty in said shares passed to Adriaan Beuken- kamp. The statement of claim goes on to relate that because the shares were registered in the name of German institutions, and by virtue of the provisions of a general Vesting Order of the Quebec Superior Court dated April 23, 1919 (said Order being made under the provisions of the Consolidated Orders Respecting Trading With The Enemy dated May 2, 1916), the prop erty in said shares vested in the Custodian of Enemy Property. The statement of claim further alleges that the said Adriaan Beukenkamp was, at all relevant times, a citizen of the Nether- lands and at no relevant time was he an enemy or a German national within the meaning of the Treaty of Peace (Germany) Order, 1920. The claimants say that by the terms of said Order, the said Adriaan Beukenkamp was entitled to have said shares relinquished to him by the Custodian of Enemy Property. In their prayer for relief, the claimants ask for a declaration pursuant to section 41 of the aforesaid Treaty of Peace (Germany) Order, 1920, that the prop erty right or interest in the aforesaid shares did not belong to any enemy as provided in the said Order. The claimants also ask for an order requiring the respondent as Custodian of Enemy
Property to relinquish the said 145 shares, all accruals thereunder and all dividends or, in the alternative, if such shares or rights have been sold, an order requiring the respondent to relin quish all proceeds of the sale of such shares, rights, dividends, interest, etc.
At the trial, there was filed the evidence of one Johannes Scholtz, taken on commission in Amsterdam on February 19, 1970. Mr. Scholtz has since died. At the time he gave his evidence, he was over 90 years of age. He said that he and his brother Daniel J. Scholtz were carrying on the business of stockbrokers in Amsterdam in 1914 under the firm name of D. J. Scholtz, that he remained a member of the said firm until 1920. He testified that he remembered a pur chase of Canadian Pacific Railway shares by Adriaan Beukenkamp in 1914. He said that they had been good friends since their childhood days, that Beukenkamp came to him with some money to invest, that he felt "things are going wrong" in Europe. Then Scholtz related their further conversation as follows:
I asked him in what he wanted to invest his money. He said: Not in Europe, not in America, the only country I choose is Canada, because that is far away and they will never come as far as there.
Scholtz says that he then recommended Canadi- an Pacific Railway shares.
Mr. Scholtz then identified a photocopy of the original purchase note evidencing the trans action. He testified that he had signed the name D. J. Scholtz, the name of his firm, to the original purchase note and that the body of said purchase note was in his handwriting. The pur chase note is dated July 20, 1914 and indicates quite clearly in the body thereof that the broker age firm of D. J. Scholtz purchased for Adriaan Beukenkamp 145 common shares of Canadian Pacific Railway on that date. The transaction and the date thereof is confirmed by Mr. Beu- kenkamp's evidence.
However, when the Commission evidence was being taken, and also at the trial, respond ent's counsel strenuously objected to the admissibility of the photocopy of the purchase note. I heard extensive argument by both coun-
sel on this question and reserved the matter for further consideration. Upon reflection, I have concluded that the photocopy of the purchase note is admissible in the circumstances of this case. The law applicable to a situation of this kind is clearly stated in Phipson on Evidence, 10th ed., paragraph 1709. Phipson states that the party tendering secondary evidence must prove the existence and execution of the docu ment. In the case at bar, Scholtz very clearly states that there was an original purchase note which he wrote out himself and signed and that the photostatic copy seeking to be introduced into evidence is a true copy thereof. Then Phip- son further states that the party tendering the secondary evidence must also prove the origi nal's destruction or establish its loss by proof that it cannot be found after diligent search. In this case, the evidence of search is contained in the evidence of Mr. Wilhelm Poolman, a Toronto solicitor retained in 1963 to act for the claimants. Mr. Poolman testified that he con tacted each and every solicitor that had acted for Mr. Beukenkamp down through the years, that he had interviewed Mr. Maurice Robitaille in Ottawa (employed as the Assistant Deputy Custodian of Enemy Property at the time) in whose office, he saw a copy of the original purchase note. Without going into Mr. Pool- man's evidence in detail, I am satisfied that this evidence does prove a diligent search for the original purchase note. I have accordingly decided to admit into evidence the two photoco pies of the original purchase note which were tendered at the trial, the one being marked as Exhibit 1 for identification to the evidence of Johannes Scholtz and the other, a more legible photocopy, being marked as Exhibit 8 to the said examination of Johannes Scholtz.
Mr. Scholtz further testified that Beuken- kamp paid for the shares at the time of pur chase. He also said that subject shares were delivered by hand a few days after the pur chase. He observed that there was a rule in the Stockbrokers Society to the effect that the shares have to be delivered within 4 days after the purchase. He said he assumed that the shares were delivered within said four day period because there had been no question or complaint to his firm about delivery. Respond-
ent's counsel argued that on this evidence, delivery of the shares had not been proven and that this is fatal to the claimant's case in view of the provisions of section 39 of the Treaty of Peace (Germany) Order, 1920, (S.C. 1919-20, p. xxxvii) which reads as follows:
39. No transfer, whether for valuable consideration or not, made after the sixth day of May, 1916 without the leave of some competent authority in Canada, by or on behalf of an enemy as defined in paragraphs (a) and (b) of section 32 of any securities shall confer on the transferee any rights or remedies in respect thereof and no company or municipality or other body by whom the securities were issued or are managed shall take any cognizance of or otherwise act upon any notice of such transfer.
I think respondent's counsel is correct when he says that the effect of section 39 is to invali date any transaction not completed on or before May 6, 1916. However, in this case, I am satis fied, on a balance of probabilities, that delivery of the subject share certificates occurred within a few days after July 20, 1914.
'The doing of an act may sometimes be inferred from the existence of a general course of business according to which it would ordinar ily be done, there being a probability that the general practice will be followed in the particu lar case. (See: 15 Halsbury, 3rd ed., p. 284, paragraph 515. See also: Phipson on Evidence, 10th ed., paragraphs 297-299.) I am satisfied on the evidence here that there was a general course of business being followed on the Amsterdam Stock Exchange pursuant to a rule of that Exchange requiring delivery of shares purchased through the Exchange within four days of purchase. I am also satisfied that there is a probability that the general practice was followed in this case, as is evidenced by the fact that Scholtz, who handled the transaction, received no complaint of non-delivery from Beukenkamp.
Counsel for the claimants tendered in evi dence at the trial, an affidavit of John Shaw, sworn on March 25, 1938. Mr. Shaw was employed as an accountant in the Ottawa Branch of the Canadian Bank of Commerce from September 16, 1933 until August of 1938. He died on December 6, 1968. Counsel for the respondent objected to the admissibility of said
affidavit. After extensive argument on its admissibility, I admitted said affidavit into evi dence as being a statement made in the course of duty by a deceased party. I was satisfied on the evidence of Dennis Carptenter, the Assist ant Secretary of the Bank, who testified at the trial, that Mr. Shaw, had a duty to make the kind of statements and provide the kind of information which Shaw in fact provided in the impugned affidavit. I accordingly held that the affidavit of Shaw was admissible as an excep tion to the hearsay rule. (For a similar view see: Dominion Telegraph Securities Ltd. v. M.N.R. [1946] 4 D.L.R. 449.)
Mr. Shaw deposed that on June 7, 1937, the Ottawa Branch of the Bank of Commerce received from Adriaan Beukenkamp, for his account, a number of share certificates covering 145 shares in the Canadian Pacific Railway Company. Particulars of said share certificates are attached as a Schedule to Shaw's affidavit. Shaw also attaches a photocopy of one of the share certificates received by his Bank and says that the others are identical to the share certifi cate attached except as to number, date, number of shares and name of the original holder. The information about the shares and share certifi cates correspond with and corroborate the accuracy of the original purchase note prepared by Johannes Scholtz.
Respondent's main ground of defence was an attack on the credibility of the witness, Johannes Scholtz. Respondent's counsel sought to point out a number of places in the transcript where, in his submission, Scholtz hesitated in giving answers or exhibited a faulty recollection of past events. I have carefully examined the transcript, and considering his advanced age, the fact that he was being asked in 1970 to recall events which transpired in 1914 and the further fact of the language barrier and the use of an interpreter, I am of the view that Scholtz's evidence is quite credible and should be accept ed. His crucial evidence as to the purchase of the shares on July 20, 1914 and his completion of the purchase note was not shaken on cross-
examination in any way. There was a suggestion of bias because of his friendship for Mr. Beu- kenkamp. However, Mr. Scholtz quite readily admitted his friendship for Beukenkamp. He also said he felt a duty to see that Mr. Beuken- kamp got what he paid for—i.e.,—the Canadian Pacific Railway shares. This is an understand able and logical reaction for an honourable man to have. The evidence was also to the effect that Scholtz had no personal financial interest in said shares. There was no evidence before me from which I could possibly impute to Scholtz any motive for perjury. Nor is there any inherent improbability in his evidence. I thought his recollection of his conversation with Beuken- kamp at the time of the share purchase was logical and reasonable in the light of the general situation existing in Europe in the summer of 1914. His recollection of the essential events was clear, and not impugned on cross-examina tion or by any other evidence. He quite freely admitted that he was not able to fix precisely the date of delivery of the shares. To me, this is an indication that he was endeavouring to be truthful and honest in his evidence and, in my view, enhances his credibility.
The respondent sought to further throw some doubt upon the evidence of Scholtz by calling a handwriting expert in the person of Sergeant Hilton Sadowsky, the Senior N.C.O. in the Royal Canadian Mounted Police Crime Detec tion Laboratory in Vancouver. Sgt. Sadowsky said that he had compared a photocopy of the broker's note with photocopies of forms pur ported to be forms completed in 1923 in con nection with the claim of Adriaan Beukenkamp. At the trial, claimant's counsel objected to the admissibility of the photocopies of the forms said to be completed in 1923. I heard argument from both counsel on this objection and reserved my decision on the question of admis sibility. I have concluded that said photocopies are inadmissible because there was no evidence proving the existence of the original documents, the identity of their maker, their loss and that a diligent search had been made for the originals
and that the purported photocopies were in fact true copies of the originals. The only evidence before me on this point is contained on page 26, questions 71 and 72 of the evidence of Johannes Scholtz, where respondent's counsel asked Mr. Scholtz to compare the photocopy of the broker's note with the forms said to be completed in 1923. Scholtz's answers clearly indicate his positive identification of the broker's note as being in his handwriting and that the other documents were not in his hand writing, and he was not sure who wrote them.
There is nothing in this evidence to warrant acceptance of the photocopies of the so-called 1923 evidence. Accordingly, the evidence of Sgt. Sadowsky is inadmissible.
To summarize, on the evidence adduced before me, I find that Adriaan Beukenkamp was, at all relevant times, a Dutch national, that he was at no relevant time a German national and was therefore never an "enemy" within the meaning of section 32 of the Treaty of Peace (Germany) Order, 1920. I find further that the said Adriaan Beukenkamp purchased 145 shares of the common stock of the Canadian Pacific Railway through the Amsterdam broker age firm of D. J. Scholtz on July 20, 1914 and that the share certificates covering said pur chase were delivered to the said Adriaan Beu- kenkamp a few days thereafter, but in any event prior to August 4, 1914. I also find that the shares purchased by Beukenkamp were regis tered in the names of National Bank fur Deutschland as to 85 shares and C. Schlesinger, Trier & Co. as to 60 shares, both German nationals and were endorsed and transferred in blank by the said firms, thus being in bearer form so that title thereto passed to the said Beukenkamp upon delivery.
I further find that the present claimants are the ones legally entitled to all the rights which the said Adriaan Beukenkamp may have pos sessed against the respondent (this was admitted at the trial by respondent's counsel).
On the basis of the above facts, it seems clear that the claimants are entitled to succeed under the authority of section 41 of the Treaty of Peace (Germany) Order, 1920 which reads as follows:
41. The Custodian may bring or take any action or other proceeding which he may think proper to enforce the provi sions of this Order, and to get in any property, right or interest vested in him.
(2) In case of dispute or question whether any property, right or interest belonged on the tenth day of January, 1920, or theretofore to an enemy, the Custodian or, with the consent of the Custodian, the claimant may proceed in the Exchequer Court of Canada for a declaration as to the ownership thereof, notwithstanding that the property, right or interest has been vested in the Custodian by an order heretofore made, or that the Custodian has disposed or agreed to dispose thereof. The consent of the Custodian to proceedings by a claimant shall be in writing and may be subject to such terms and conditions as the Custodian thinks proper.
(3) If the Exchequer Court declares that the property, right or interest did not belong to an enemy as in the last preceding subsection mentioned, the Custodian shall relin quish the same, or, if the Custodian has before such declara tion disposed or agreed to dispose of the property, right or interest, he shall relinquish the proceeds of such disposition.
(4) No such declaration shall affect the title or right of any person to whom the Custodian has before such declara tion disposed or agreed to dispose of any property, right or interest.
Mr. Justice Thurlow commented on the effect of section 41 on the motion heard by him in this action referred to earlier herein as follows (Beu- kenkamp v. Secretary of State (1970) Ex.C.R. 158 at 162 and 164):
In my opinion so far from sweeping away the rights of a person in the position in which the claimant alleged himself to be the effect of the Treaty of Peace (Germany) Order, 1920, was to continue and preserve the property rights of persons other than those German nationals whose property was confiscated. As I view it, the cause of action of such a claimant in a proceeding of the kind contemplated by sec tion 41(2) consisted of the facts which, when established, would entitle him to have the shares relinquished, that is to say, as applied to this case, the fact of the claimant having bought the shares before the commencement of the war and having continued to hold them until they became vested in the Custodian, coupled with the fact of his never having been an enemy within the meaning of the Treaty of Peace (Germany) Order, 1920... .
I have the view that these claimants have brought themselves squarely within the provi sions of section 41 referred to supra and are entitled to succeed.
They have also complied with the procedural requirements of section 41 by filing a Consent of the Custodian of Enemy Property to the proceeding in this Court (said Consent is dated July 10, 1934 and was filed at the trial as Exhibit P-2).
The claimants herein will accordingly have judgment against the respondent in the terms of paragraphs 16(a), (b) and (c) of the amended statement of claim dated October 2, 1973. Pur suant to Rule 337(2)(b), counsel for the claim ants may prepare a draft of an appropriate judg ment to implement the Court's conclusions and move for judgment accordingly.
The claimants are also entitled to their costs of the action against the respondent, to be taxed.
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