Older home that’s been most re-wired. 100 amp service to the main with 60 amp feeder to the sub just to the left of it (see pic). Only 3 wires - 2 hot and 1 neutral feeding the sub.
The sub had isolated grounds and neutrals on separate buses.
The sub ground bus was grounded through a grounding electrode to a grounding rod outside of the house instead of back to the main panel.
You are correct this is not proper .
There should be only one ground in the system in Canada ( I think USA is the same ).
So it should have been a 4 wire feeding this panel 2 hot’s a neutral and a ground .
Over fuse needs to be corrected immediately .
Adding fuse inserts are a good idea and help to stop over fusing. As Jim says Metal pipe and 3 wires is good .
Thanks for your post’s many get good info from them .