Limping Towards 2000
The Short and Likely Long Term View for The
Law of Charities and Non-Profits
It is disturbingly ironic but entirely predictable that the most
comprehensive study of the Canadian law of charities and non-profits
should be almost inaccessible: ironic because its wide-ranging
and important recommendations couldn't even get properly published;
and predictable because for all the public and private sector
chest-thumping about the central, vital role played by the third
sector, nothing useful ever seems to get done to make its work
any easier.
The Ontario Law Reform Commission's Report on The Law of Charities
has a publication date of December 1996. The Report wasn't really printed
until the early spring. However, only 300 copies were made and those are
now gone. The Commission was disbanded about the same time and saving
printing costs was an apparent priority. Hopefully, some copies may be
available for reading through some of the major voluntary organizations
such as the Canadian Council for Social Development.
NOTE: the report is posted electronically on the Centre of Philanthropy and Nonprofit Studies website at http://www.bus.qut.edu.au/research/cpns/ontario.jsp and on the Mount Royal College website at http://www.mtroyal.ab.ca/nonprofit/lawofcharities.pdf.
Nineteen chapters, eight appendices and hundreds of pages detail
the findings of a report that was commissioned in June 1989 to
"study the law governing charitable organizations and
to make recommendations respecting "the appropriate laws
to govern charities in modern times". The terms of reference
asked the Commission to examine the status, the legal form, the
sources, and the uses of revenue of charitable organizations,
as well as the form of government supervision appropriate to
the charitable sector as a whole.
The Report is both a goldmine of information and a profound disappointment.
Bringing so much legal information together in one place will
greatly aid lawyers practising and academic to do
their work. In addition, charities and non-profits now have a
single state-of-the-art document to review in trying to understand
this quagmire area of law, though understandably with an Ontario
focus. But the dismay and frustration comes in knowing that this
Report (which couldn't even get properly published) like so many
others before it in Britain, Australian, and other Commonwealth
countries will be consigned to a forgotten shelf, or in this
case a discarded diskette, and never be implemented. In the understated
language characteristic of this kind of document, the Report
observes,
"The Commission's task to suggest the design of appropriate
contemporary laws to govern modern charities is made difficult
by a unique set of factors. Primary among these is the fact that
relatively little attention academic, political, legislative,
or otherwise has been paid to the charitable sector in
recent years. In the estimation of most informed observers, the
charity sector constitutes a "third order" of organization
in society, on a par, theoretically, with the private or market
sector and with the public or government sector. Like these,
it is implicated in the allocation of resources, the distribution
and redistribution of wealth, and the control of economic and
social power. Also, like these it is, in principle, founded on
a very distinctive logic of human relations: its culture of altruism
stands in contrast to the market sector's culture of contract
and the public sector's culture of law and the public interest.
Despite this position of theoretical pre-eminence, however, the
charity sector in Canada has attracted comparatively little academic,
political, or legislative interest As a consequence, there is
a noticeable lack of informed public debate on the role of the
sector in Canadian society."
This awareness has been long understood by those working with
charities and non-profits, though expressed in slightly more
visceral language. And, it's doubly ironic that just when this
version of dryly official understanding is struggling to stay
out of the cyber archives, the Supreme Court of Canada has decided
to hear its first case on charities since the Income Tax Act
sections which now govern charities were introduced in 1976.
In what could be the most important charities case in nearly
30 years, Society of Immigrant & Visible Minority Women
(see Reprint Series 2:6 or LawNow 23:5 April/May 1999) is appealing
a refusal by Revenue Canada to register it as a charitable organization
because its purposes were held to be too vague, not educational,
and political in nature, positions upheld by the Federal Court
of Appeal. The case invites the Court to:
· confirm that the law of Canada regarding the definition
of charity is that which originated in England and is commonly
described as the four heads of charity1 in Pemsel's
case, with or without guidance as to modern application of the
case law which has developed with the application of the Pemsel
categories; or
· broaden the meaning of charity by somehow adjusting
the Pemsel categories, to substitute some other standard
or by augmenting the Pemsel categories, by adopting a
particular formulation of the public benefit test.
As this column is written, the Supreme Court of Canada just finished
hearing the Vriend appeal. This case canvassed the extremely
important issue of sexual equality rights. It had seventeen interveners
on both sides and was slated for two days of argument. Society
of Immigrant & Visible Minority Women is slated for a
half day and thus far there is only one intervention. To borrow
the words of the Law Reform Commission Report of Charities, with
slight modification: despite its position of pre-eminence, the
charity sector in Canada has attracted comparatively little academic,
political, or legislative interest. As a consequence, there is
a noticeable lack of informed public debate on the role of the
sector in Canadian society. It appears this will continue to
be the case.
Laird Hunter is a lawyer with the firm of Worton and Hunter
in Edmonton, Alberta.
References
1 relief of poverty, advancement of religion,
advancement of education, or matters having a charitable aspect
for the general community as a whole.
