Court of Appeal Upholds Common Law Exclusion in Termination Clause

Feb 2018 Charity & NFP Law Update

On January 8, 2018, the Court of Appeal for Ontario released its decision in Nemeth v Hatch Ltd. In this case, the court considered an appeal of the dismissal of an action by Joseph Nemeth (“Nemeth”) against Hatch Ltd., his former employer, for damages resulting from the termination of his employment without cause. In its decision, the court determined that the termination clause in Nemeth’s employment contract, which did not explicitly limit his common law notice entitlement, was nonetheless legally enforceable and did in fact limit his entitlement. This Bulletin reviews this decision with regard to the termination clause, and focuses on the importance of properly drafted termination clauses for charities and not-for-profits when negotiating employment contracts with their employees.

For the balance of this Bulletin, please see Charity & NFP Law Bulletin No. 415.


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Interlocutory Injunction Denied for the 2018 Canada Summer Jobs Program

Feb 2018 Charity & NFP Law Update

On January 30, 2018, the Federal Court delivered its decision in Right to Life Association of Toronto and Area, Blaise Alleyne and Matthew Battista v Canada (Minister of Employment, Workforce, and Labour). In this case, the Right to Life Association of Toronto and Area (the “RTL”), its president, and a prospective summer student (the “Applicants”) introduced a motion seeking an interlocutory injunction to stay the decision of the Minister of Employment, Workforce Development and Labour (the “Minister”) to add a new mandatory attestation requirement to the application for the 2018 Canada Summer Jobs Program (the “Attestation”). The Attestation consists of four statements, including the following:

Both the job and the applying organization’s core mandate respect individual human rights in Canada, including the values underlying the Canadian Charter of Rights and Freedoms as well as other rights, including reproductive rights and the right to be free from discrimination on the basis of sex, religion, race, national or ethnic origin, colour, mental or physical disability or sexual orientation, or gender identity or expression

The Canada Summer Jobs 2018 Application Guide further explains that the government “recognizes that women’s rights are human rights. This includes sexual and reproductive rights — and the right to access safe and legal abortions.”

The motion for an interlocutory injunction aimed to temporarily suspend the deadline to apply for the 2018 Canada Summer Jobs Program, last extended to February 9, 2018, until the court decided on the merits of an underlying application for judicial review. That application challenged the constitutionality of the Attestation as being compelled speech by the government and thus infringing upon the Applicant’s freedom of conscience, thought, belief, opinion, expression, and right to equality. In dismissing the motion for interlocutory injunction, the Federal Court held the Applicants had not met the elements of the three-part test established by the Supreme Court of Canada in RJR-Macdonald Inc v Canada (Attorney General)(1994).

The Applicants had to establish that a serious issue had been raised in the underlying application for judicial review, demonstrate a real probability that irreparable harm would result from not granting the interlocutory injunction, and that, on a balance of convenience, the harm to the Applicants by denying the interlocutory injunction would be greater than that to the Minister and the public interest. In this regard, the motion judge held that the Applicants had failed to demonstrate that they would suffer irreparable harm if the interlocutory injunction was not granted, and that the balance of convenience favoured dismissing the motion because a stay of the Minister’s decision to include the Attestation would cause irreparable harm to the public interest.

On January 23, 2018, after the hearing of the motion, the Canada Summer Jobs 2018 Program’s website published a “Supplementary Information” page containing hypothetical examples of faith-based organizations with anti-abortion beliefs that would be eligible to apply. However, by the application deadline of February 9, 2018, the Attestation remained as originally introduced and the decision of whether the Attestation infringes upon the rights protected under the Charter of Rights and Freedoms, expected to be decided later this year, will only address this issue for 2019. As such, charities and not-for-profits with an interest in the Canada Summer Jobs Program will need to continue to monitor this case going forward. 


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Charitable Sector Reform Paper by The Pemsel Case Foundation

Feb 2018 Charity & NFP Law Update

The Pemsel Case Foundation, an Alberta charitable corporation named after the 1891 decision of the House of Lords establishing the four principal common law heads of charity, has released a paper on charity law reform (the “Paper”). Following the 2016 Pemsel Case Foundation paper focused on the Income Tax Act definition of “charitable organization”, the Paper reviews the significance of the common law meaning of charity, in terms of “charitable activities” as opposed to “charitable purposes” in the context of the rules currently governing the registration and maintenance of charitable status. The Paper also comments on policy considerations and recommendations for legal reform, including the rules regarding the disbursement quota, foreign aid and other gifts to non-qualified donees, business activities, the acquisition of control of a corporation, long-term debt, and political activities.

To access the full paper, see here.


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Reconciling Physician and Patient Rights

Feb 2018 Charity & NFP Law Update

On January 31, 2018, the Divisional Court of Ontario released its long and detailed decision in The Christian Medical and Dental Society of Canada v College of Physicians and Surgeons of Ontario. Two applications were brought by a group of individual physicians and organizations (the “Applicants”) challenging the constitutional validity of two policies of the College of Physicians and Surgeons of Ontario (the “CPSO”), the medical profession’s provincial self-governing body. The challenged policies require physicians, even those who object to certain procedures (e.g. abortions, medical assistance in dying) on moral or religious grounds, to provide patients with an “effective referral”, meaning a timely referral, in good faith, to a non-objecting, available, and accessible physician, other health-care professional or agency (the “CPSO Policies”). This Bulletin reviews how the court concluded that the CPSO Policies infringed the physicians’ right to freedom of religion under the Charter of Rights and Freedoms (the “Charter”) but could be justified under section 1 of the Charter as reasonable limits demonstrably justified in a free and democratic society.

For the balance of this Bulletin, please see Church Law Bulletin No. 53.


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February 2018 Charity & NFP Law Update

– Federal Budget 2018: Impact on Charities and Not-for-Profits
– CRA News
– Legislation Update
– Court Rejects Church Application for Permanent Injunction in Property Dispute
– Court of Appeal Upholds Common Law Exclusion in Termination Clause
– Interlocutory Injunction Denied for the 2018 Canada Summer Jobs Program
– Reconciling Physician and Patient Rights
– Baseball Trademark Gives Rise to Human Rights Claim
– Internal Disciplinary Decision is Not Subject to Judicial Review
– Privacy Commissioner Releases Draft Position Paper on Online Reputation
– The Investment Spectrum for Charities, Including Social Investments
– Charitable Sector Reform Paper by The Pemsel Case Foundation
– Anti-Terrorism/Money Laundering Update
– Ottawa Region Charity & NFP Law Seminar Materials Available


February 2018 Charity & NFP Law Update