by Dev User | Jun 28, 2018 | Uncategorized
Jun 2018 Charity & NFP Law Update
On June 19, 2018, the House of Commons Standing Committee on Access to Information, Privacy and Ethics (the “Committee”) made available the Government of Canada’s response to the Committee’s report (the “Report”), discussed in the March 2018 Charity & NFP Law Update, regarding the Personal Information Protection and Electronic Documents Act (“PIPEDA”). In its response, the Government of Canada acknowledged that changes to Canada’s privacy regime are needed and it addressed the 19 recommendations of the Report under the four following themes:
- consent under PIPEDA, confirming that consent will continue to form the basis of Canadian privacy legislation but agreeing that the consent regime can be enhanced and clarified, particularly around issues such as social media and the protection of minors’ information online, and to ensure that Canada’s consent regime remains progressive and aligned with internationally recognized standards;
- online reputation and respect for privacy, noting that the risks in this area particularly impact young people and that there are divergent views on matters such as the right to de-indexing and erasure and questioning whether PIPEDA is the right mechanism for addressing de-indexing and erasure given its limited application to the commercial context;
- agreeing that PIPEDA’s enforcement mechanism can be improved and indicating that the government will look at various models of compliance and enforcement options, possibly including providing
of the Office of the Privacy Commissioner of Canada with increased enforcement powers (“OPC”); and
- impact of the GDPR, advising that the Government is “working closely with the European Commission to understand the requirements for maintaining Canada’s adequacy standing under the EU GDPR” and indicating that the Government’s approach reflects the EU’s concept of “essential equivalence” rather than a one-to-one incorporation of GDPR principles into the Canadian regime.
Read the June 2018 Charity & NFP Law Update
by Dev User | Jun 25, 2018 | Uncategorized
Jun 2018 Charity & NFP Law Update
In June 2018, the Special Senate Committee on the Charitable Sector (“Committee”) continued its study on the impact of federal and provincial laws and policies on the charitable and not-for-profit sector through two meetings with witnesses held on June 4 and 11, 2018. The Committee also held an additional in camera meeting on June 18, 2018 to consider a draft agenda for future business. At the June 4th meeting, witnesses from Service Canada, Statistics Canada, Volunteer Canada, and various academics discussed issues related to volunteering. The witnesses presented findings from a number of studies and discussed topics including the demographics of volunteers, the development of a youth service program, the evolution of volunteering, and reasons people do or do not volunteer.
At the June 11th meeting, witnesses from various departments and agencies of the Government of Canada, such as Global Affairs Canada and Employment and Social Development Canada, discussed the contribution of charities and non-profit organizations to government service delivery and policy consultation. The witnesses provided an overview of various government volunteer programs and other initiatives that engaged the volunteer sector, and discussed methods and issues in funding not-for-profits and alignment with the government’s priorities.
Read the June 2018 Charity & NFP Law Update
by Dev User | May 31, 2018 | Uncategorized
May 2018 Charity & NFP Law Update
Automated Calls from CRA for T3010 Information Returns due June 30, 2018
On May 29, 2018, the Canada Revenue Agency (“CRA”) informed followers of its Twitter account that it is making automated courtesy calls to remind registered charities whose fiscal year-end was December 31, 2017 to file their completed T3010 information return by June 30, 2018. A complete return is due within six months after the end of the charity’s fiscal year. It is possible that, as with last year’s automated calls from the CRA, charities that have already filed their information return may still receive a call. The CRA’s website provides information on the documents that must be included with a charity’s T3010 information return.
In this regard, it is also important to note that the board of directors of a charity is ultimately responsible for the accuracy of the information provided to the CRA in the T30a10. Accordingly, the board should review and formally approve the T3010, as well as indicate who within the charity has the authority to sign the T3010 on its behalf, with such decisions to be properly recorded in the board minutes. Failure to file a complete information return or filing an inaccurate one can result in a suspension of receipting privileges until the required information is provided to the CRA. Even if an incomplete or inaccurate T3010 information return does not result in sanctions by the CRA, the ability of the public to view a T3010 with errors may result in damage to the reputation of a charity with its donors, volunteers and supporters, as well as the general public, including enquiries by the media. To avoid problems in this regard, it may be prudent where a charity is able to do so to ask its legal and accounting professionals to review the T3010 information return for accuracy and, where necessary, advise on technical aspects of the T3010.
Read the May 2018 Charity & NFP Law Update
by Dev User | May 31, 2018 | Uncategorized
May 2018 Charity & NFP Law Update
In the U.S. case of Appalachian Bible College v Foremost Industries, released on April 17, 2018, the United States District Court for the Middle District of Pennsylvania held that a charitable pledge made by a corporate donor, Foremost Industries (“Foremost”), to a non-profit educational institution, Appalachian Bible College (“College”), was binding upon the donor. Since pledges are generally held by courts in Canada to be unenforceable as contracts, it is interesting to note that the law was determined to be the opposite in Pennsylvania.
In 2015, Foremost executed a donor commitment (“Gift Agreement”) to donate $4 million to the College through five annual payments of $800,000 beginning in 2016. The Gift Agreement stated that Foremost’s commitment was legally binding and enforceable against Foremost, its successors and assigns. Foremost subsequently executed a unanimous written consent to ratify the Gift Agreement. Not only did Foremost fail to make its annual payments to the College, it indicated to the College that it did not intend to make any future payments. The College therefore brought an action against Foremost, claiming breach of contract and anticipatory breach of contract.
The court considered whether all elements required under Pennsylvania law were present to find a breach of contract. In this regard, it found that the Gift Agreement contained all essential terms of a contract, and that it indicated both parties’ intent to be legally bound by the agreement and to legally bind successor entities. It further found a breach of duty imposed by the contract when Foremost failed to pay the pledged amount and indicated it did not intend to uphold its pledge at all. Of particular note, the court also found that the Gift Agreement stated that the College “is relying, and shall continue to rely, to its detriment” on the pledge being satisfied, and that the gift would be used as “an inducement” for other donors to make contributions and gifts to the College. The court therefore held that Foremost had breached the Gift Agreement with respect to the past due payments. With respect to its indication that it did not intend to uphold its pledge, Foremost was also found to be in anticipatory breach of contract for the remainder of the pledge, and was ordered to pay the full pledged amount to the College within 90 days.
This case demonstrates a striking difference between American and Canadian law. In Canada, courts have affirmed that charitable pledges are not enforceable as contractual agreements in the absence of consideration, such as the Brantford General Hospital Foundation v Marquis Estate case discussed in Charity Law Bulletin No. 49. In that case, the Ontario Superior Court did not accept the charity’s position that naming a new hospital unit in honour of the donor was sufficient consideration, and held that the charity failed to establish that it had relied on the pledge to its detriment. In Canada, a pledge would only be enforceable if there is sufficient consideration, which would bring into question the nature of the pledged “gift,” which by definition is not accompanied by consideration. As well, a pledge could be held to be enforceable based on the doctrine of estoppel if there is partial performance of the pledge based on a pre-existing legal relationship between the parties which the charity acted to its detriment in reliance on the pledge. As such, charities operating in Canada should continue to operate under the common law principle that a pledge is not an enforceable contract at law unless there is sufficient consideration or the doctrine of estoppel as explained above applies.
Read the May 2018 Charity & NFP Law Update
