by Dev User | Mar 31, 2016 | Charity & Not-for-Profit Law, Faith-Based Organizations
Federal Budget 2016: Impact on Charities and Not-for-profits
CRA News
Legislation Update
Tribunal Awards Damages to Job Applicant
FCA Confirms Use of Domain Name Can Constitute Trademark Infringement
Appeal Court Upholds Testamentary Freedom
Ontario Court Confirms Church Property Used for Religious School Exempt from Municipal Property Tax
Charities Directorate Reports to Senate Committee on National Security
Ontario Budget 2016: Impact on Charities and Not-for-profits
Canada Summer Jobs Program Doubled
March 2016 Charity & NFP Law Update
by admin | Mar 31, 2016 | Charity & Not-for-Profit Law
Excise and GST/HST News – No. 98
On March 3, 2016, Canada Revenue Agency (“CRA”) published Excise and GST/HST News – No. 98, its quarterly online newsletter (“Newsletter”), which “highlights recent developments in the administration of the goods and services tax (GST) and harmonized sales tax (HST)”. The Newsletter includes information about recent developments related to a proposed HST rate increase in New Brunswick, the public service bodies’ rebate, supplies of admissions to places of amusement by public service bodies, and Form GST523, Non-profit Organizations – Government Funding.
Updates to Publications
In the past month, CRA has updated a few of its publications with charity related content. For example, P113, Gifts and Income Tax 2015 has been revised to reflect the fact that now any “foreign charity (including a foreign charitable foundation) that applies for registration, may also be registered as a qualified donee provided that it meets all conditions for registration.” Guide 5000-G, General Income Tax and Benefit Guide 2015 – All Provinces Except Non-Residents now includes a reference to CRA’s web-based mobile app that individual taxpayers can access throughout the year to “confirm before you donate that the charity at your door is registered, and calculate the effect your donation will have on your taxes.” As well, publications RC191, Becoming a Prescribed University Outside Canada and T4063, Registering a Charity for Income Tax Purposes were also recently updated.
Humane Society of Canada Revoked
On March 19, 2016, the Humane Society of Canada for the Protection of Animals and the Environment, Toronto, Ont.’s (the “Society”) charitable registration was revoked. The following reasons for revocation were published on CRA’s website:
It is the Canada Revenue Agency’s (CRA) position that the Humane Society of Canada for the Protection of Animals and the Environment (the Organization) has not devoted all of its resources to charitable activities for which it was registered. The Organization has conferred an undue benefit on a member of its governing board, improperly completed its information return, and failed to maintain adequate books and records to support its activities. For all of these reasons, and for each of these reasons alone, it is the position of CRA that the Organization’s registration should be revoked.
The revocation followed the Supreme Court of Canada’s March 10, 2016, dismissal of the Society’s request for leave to appeal of the Federal Court of Appeal’s decision confirming the Minister of Revenue’s notice of intention to revoke. For more information about the Federal Court of Appeal case, see Charity & NFP Law Update for July/August 2015.
by admin | Mar 31, 2016 | Charity & Not-for-Profit Law
Federal Government announces new Canadian Citizenship Requirements
On March 21, 2016, Bill C-6, An Act to Amend the Citizenship Act passed second reading and will be referred to the Standing Committee on Citizenship and Immigration in the House of Commons. Bill C-6, introduced by the Liberal government and accompanied by a backgrounder, An Overview of Proposed Changes to the Citizenship Act (the “Backgrounder”), on February 25, 2016, would substantially amend the Citizenship Act, if passed and will no doubt be of interest to charities and not-for profits that work with refugees.
The Backgrounder states that the proposed changes would provide greater flexibility for applicants trying to meet citizenship requirements. It would also repeal certain provisions of the Citizenship Act that came into effect in 2015, as part of Bill C-24, which permit revocation of citizenship from dual citizens who engage in certain acts against the national interest, such as terrorism. The ability to revoke citizenship where it was obtained by false representation, fraud or by knowingly concealing material circumstances will remain unchanged.
Bill C-6 also contains additional changes that are intended to enhance program integrity:
- Conditional Sentences. Individuals serving conditional sentences will no longer be able to count that time toward the physical presence requirement.
- Maintaining requirements for citizenship until Oath taking. All applicants must continue to meet requirements of citizenship, regardless of when their application was received.
Ability to Seize Documents. Citizenship officers will have improved ability to carry out investigations and prevent further use of fraudulent or suspected fraudulent documents.
Fairness in Charitable Gifts Act Introduced
On February 26, 2016, a private member’s bill, Bill C-239, The Fairness in Charitable Gifts Act, was introduced in Parliament by opposition MP, Ted Falk. Bill C-239 proposes amending the Income Tax Act to increase the amount that an individual taxpayer is able to claim during a taxation year for donations made to charities. Specifically, the Bill C-239 would increase the tax credit available for charitable donations by individuals to match the current tax credit available for political donations by establishing the following donation tax credits:
- Donations under $400: 75% federal tax credit.
- Donations from $400-$750: 50% federal tax credit.
- Donations over $750: 33.3% tax credit.
As a private member’s bill, Bill C-239 will be subject to a lottery to determine whether or not it will be debated in Parliament.
Poverty Reduction Strategy Bill Introduced
On February 26, 2016, opposition MP Brigitte Sansoucy, introduced Bill C-245, the Poverty Reduction Act.in Parliament. Bill C-245 is a private member’s bill that seeks to “take into account all people living in poverty, the factors that put people at higher-than-average risk of poverty and the consequences of poverty for society at large.” Bill C-245 proposes to implement a comprehensive strategy to reduce and fight poverty in Canada and would institute an independent office for a Poverty Reduction Commissioner.
Bill C-245 also proposes several legislative amendments. Specifically, it would amend the Canadian Human Rights Act to add social condition as a prohibited ground of discrimination. It would also amend the Department of Employment and Social Development Act to establish a National Council on Poverty Elimination and Social Inclusion that would consist of a maximum of 16 members appointed by the Governor in council to advise the Minister of Employment and Social Development.
Charities involved with the alleviation of poverty will be interested to follow whether Bill C-245 is selected for debate in Parliament following the lottery process.
Bill regarding Community Benefit Agreements Introduced
On February 24, Bill C-227, An Act to amend the Department of Public Works and Government Services Act (community benefit), was introduced as a private member’s bill by government M.P. Ahmed Hussen. If passed, it would provide the Minister of Public Works and Government Services (the “Minister”) with authority to require an assessment of the benefits that a community may or may not derive from new government-funded construction, maintenance and repair projects.
Bill C-227 defines a community benefit as “a social or economic benefit that a community derives from a construction, maintenance or repair project, and includes local job creation and training opportunities, improvement of public space within the community and any other specific benefit identified by the community.” Parties bidding on projects would therefore be required to report to the Minister information about the community benefits their proposals contain. In turn, the Minister would be required to annually report to Parliament on community benefits that have been achieved through new projects.
Should this Bill pass, charities and not-for-profits might want to consider forming community benefits networks to engage with governments and developers in ensuring proper distribution of benefits to the communities where development is taking place. One of the ways that these networks might be able to accomplish this would be through a community benefit agreement that places legal obligations on all parties involved to ensure that the development is successful. For more information about community benefits agreements see our Charity & NFP Law Update from January, 2016.
Ontario Government Making Hospital Parking More Affordable
On January 18, 2016, the Ontario Ministry of Health and Long-Term Care (the “Ministry”) issued a news release about a commitment to making hospital parking more affordable for patients and caregivers (the “News Release”). This followed consultations by the Ministry with patients, hospitals, advocacy groups, and the Ontario Hospital Association. Specifically, Ontario hospitals that charge more than $10 per day for parking will be required to provide 5, 10, and 30 day parking passes that are:
- Discounted by 50 per cent off their daily rate
- Transferable between patients and caregivers
- Equipped with in-and-out privileges throughout a 24-hour period
- Good for one year from the date of purchase
The changes are part of the Ministry’s Patients First: Action Plan for Health Care and will be implemented as of October 1, 2016.
by Dev User | Mar 31, 2016 | Charity & Not-for-Profit Law, Employment Law, Expertise
In Paquette v Amaruk Wilderness and another (No. 4) (“Paquette”), the British Columbia Human Rights Tribunal (the “Tribunal”) considered a discrimination complaint by Bethany Paquette (the “Complainant”) after her employment application to Amaruk Wilderness Corp. (“Amaruk”), a wilderness adventure company, was rejected. The Complainant alleged that she was refused employment, in part, because of her religion and status as a recent graduate of Trinity Western University. In the decision, released on March 2, 2016, the Tribunal held that Amaruk, through the actions of its employees and director, had discriminated against the Complainant on the basis of religion. After Amaruk made preliminary objections as to the jurisdiction of the Tribunal to hear the complaint, which were dismissed, the company and its legal counsel withdrew from the hearing. The hearing of the complaint then proceeded in Amaruk’s absence.
While cases of discrimination against individuals on the basis of religious belief during the course of a hiring process are not usual, this case serves as a reminder that employers need to conduct their hiring practices in a way that does not discriminate on a presumption of religion or religious affiliation. As this case shows, Tribunals may award damages to complainants when an employer’s (or potential employer’s) conduct causes harm to an individual’s identity on the basis of their religious beliefs. Where applicants can demonstrate prima facie discrimination on these grounds, an employer may be subject to liability. This Charity & NFP Bulletin will review the Paquette decision, the principles of which may be also applicable to Ontario employers including charities and not-for-profits.
For the balance of the Bulletin, please see Charity & NFP Law Bulletin No. 383.
by admin | Mar 31, 2016 | Charity & Not-for-Profit Law, Intellectual Property Law
On March 15, 2016, the Federal Court of Appeal (the “Court”) delivered from the Bench its decision in Michaels v Michaels Stores Procurement Company, Inc., in which it upheld a default judgment against David Michaels and Michaels Inc., (the “Appellants”). The decision reaffirmed that the adoption and use of an internet domain name can constitute trademark infringement in Canada if the use of the domain name creates confusion in the marketplace.
Michaels Stores Procurement Company, Inc. and Michaels of Canada, ULC (the “Respondents”) were the owners of the trademark, “MICHAELS”, and brought a claim against the Appellants for use of their trademark in the domain name “michaels.ca”. The lower court rendered a default judgment against the Appellants stating that, in using said trademark in a domain name, the Appellants had “established actual confusion on the part of Michaels Stores of Canada, ULC and its suppliers”, which amounted to trademark infringement. As a result, the Appellants were ordered to deliver the domain name to the Respondents.
On appeal, the Court found that the allegations of trademark infringement had been made out as pled in the Respondents’ claim, as had allegations of passing off, depreciation of goodwill and the communication of false and misleading statements.
Finally, the Court also found that the order to deliver the domain name was not overly broad. It did not preclude the personal Appellant, David Michaels from using his name on the internet or for trade purposes, so long as the word “Michaels” was not used in a confusing way.
While the decision does not extend so far as to conclude that all use of a trademark as a domain name would amount to trademark infringement, it recognizes that confusion may result from the use of a domain name, and that if it does, such use is actionable. The decision will be of interest to charities and not-for-profits which use domain names, and serves as a warning that registered trademarks must not be used as domain names in a way that may confuse the public, since otherwise, it may result in trademark infringement.
by admin | Mar 31, 2016 | Charity & Not-for-Profit Law
“A testator’s freedom to distribute her property as she chooses is a deeply entrenched common law principle” stated the Ontario Court of Appeal in Spence v BMO Trust Company (“Spence”) on March 8, 2016. In this case, the Court of Appeal reviewed an earlier decision by the Superior Court of Justice (“Superior Court”) to set aside the last Will and Testament (“Will”) of Eric Spence (“Eric”) because it was determined to violate public policy against racist discrimination. The Superior Court’s decision in this matter had been based on extrinsic evidence provided by Eric’s daughter, Verolin Spence (“Verolin”), as well as Eric’s long-term caregiver, that Verolin and her son, A.S., were excluded from Eric’s Will on grounds which were contrary to public policy. Specifically, based on the extrinsic evidence, Verolin alleged that her once good relationship with her father, who was black, turned cold after she told him that the father of her child was white. However, Eric’s Will specifically stated that his reason for excluding Verolin was because “she had no communication with me for several years and has shown no interest in me as her father.”
The Superior Court Application Judge hearing the matter had held that while, on its face, the Will did not offend public policy, the extrinsic evidence showed that Eric’s intention in excluding his daughter and grandson was based on a “clearly stated racist principle,” and offended “not only human sensibilities but also public policy.” While the Court of Appeal conceded that the case law shows that “Canadian courts will not hesitate to intervene on the grounds of public policy,” it held that the occasions for doing so are limited to those where the testator’s wishes in his or her will result in implementation by an executor or beneficiary that is contrary to public policy. Some examples of such circumstances would include those where the implementation of a will would facilitate purposes contrary to human rights or criminal laws, or where there is an explicit reason in a trust that is discriminatory where that trust is public or quasi-public in nature. By contrast, in a case where an individual’s will does not, on its face, offend public policy, the Court of Appeal held that courts should not use extrinsic evidence to interfere with the testator’s testamentary freedom.
Specifically, the Court of Appeal stated that “[a]bsent valid legislative provision to the contrary, the common law principle of testamentary freedom thus protects the testator’s right to unconditionally dispose of her property and choose her beneficiaries as she wishes, even on discriminatory grounds.” The Court concluded that to apply the public policy doctrine to void and unconditional bequests in cases, such as this one, would be to effect a “material and unwarranted expansion of the public policy doctrine.”
In light of this decision, it remains to be seen whether the Ontario government will enact legislative provisions to place defined limits on testamentary bequests or instead will continue to defer to the common law rule of testamentary freedom.
