by Dev User | May 31, 2018 | Uncategorized
May 2018 Charity & NFP Law Update
On March 7, 2018, the Federal Court released its decision in the case of Collett v Northland Art Company Canada Inc., in which the plaintiff Mr. Collett (“Collett”), a professional photographer, claimed that the defendants Northland Art Company Canada Inc. (“NACC”) and Bremner Fine Art Incorporated operating as Northland Art Company (“Northland”) had infringed the copyright and moral rights in his photographic works.
Collett originally began supplying printed copies of his works to Northland in 2011 for purposes of resale, but upon a deterioration of the relationship between both parties, he ceased to supply prints to Northland in or around November 2013. At that time, Collett advised Northland that it was no longer authorized to distribute, offer for sale, or sell any of his works. Collett alleged that, after advising Northland to cease distributing his works, it nonetheless continued to advertise, make unauthorized reproductions of, and sell prints of his works through various venues, including Northland’s website, at trade shows, and on various rewards websites. In certain instances, Collett’s signature had been removed from unauthorized prints and replaced with the signature of another photographer, Anthony Randall.
In considering whether Collett’s copyright was infringed, the court relied on the definition of copyright under s. 3(1) of the Copyright Act as being the “sole right to produce or reproduce the work or any substantial part thereof in any material form whatever,” and stated that this also includes the sole right to authorize such acts. In this regard, the court found that Collett’s copyright had been infringed where his works had been reproduced without his authorization.
With respect to infringement of Collett’s moral rights, the court relied on s. 14.1(1) of the Copyright Act, which provides that “[t]he author of a work has, subject to section 28.2, the right to the integrity of the work and, in connection with an act mentioned in section 3, the right, where reasonable in the circumstances, to be associated with the work as its author by name or under a pseudonym and the right to remain anonymous.” Section 28.2 states that an author’s right to the integrity of a work is infringed “only if the work or the performance is, to the prejudice of its author’s or performer’s honour or reputation, (a) distorted, mutilated or otherwise modified; or (b) used in association with a product, service, cause or institution.” In this regard, the court found that in instances where the reproductions were attributed to Anthony Randall, Collett’s moral rights had been infringed.
As NACC had not been incorporated at the time of the infringement, the court held that it could not be held liable for the infringements. However, Northland’s infringements were held to be infringements for commercial purposes, conducted out of bad faith, flagrantly and deliberately. Based on its differing levels of infringement for different works of art, Northland was held liable for the maximum statutory damages of $20,000 for copyright infringement of one work, $10,000 for the infringement of a second work, $7,500 for reproducing a third work on its website homepage, and a further $7,500 for reproduction of the same work on “Bio Page” of its website. A further $10,000 in damages was awarded for infringement of Collett’s moral rights, along with $25,000 in punitive damages. Finally, given that both Northland and NACC had been seen by the defendants as “all the same company”, a permanent injunction was awarded against both parties.
This case is a reminder to charities and not-for-profits of the serious consequences that can flow from a breach of the copyright and moral rights of an owner, including that of photographers, as well as the corresponding importance of ensuring that a charity or not-for-profit either secures the ownership of copyrights through a properly drafted assignment of copyright and waiver of moral rights, or secures an adequate license of the copyrights in question.
Read the May 2018 Charity & NFP Law Update
by Dev User | May 31, 2018 | Uncategorized
May 2018 Charity & NFP Law Update
Special Senate Committee Continues Study on Charitable Sector
On May 28 2018, the Special Senate Committee on the Charitable Sector (“Committee”) met with witnesses from the Social and Aboriginal Statistics Division of Statistics Canada, as well as individuals and representatives involved with research of the charitable and not-for-profit sector, to discuss charitable giving in Canada. This meeting followed a meeting of the Committee on May 7, 2018, in which the Committee heard from witnesses from the National Economic Accounts Division of Statistics Canada and Imagine Canada on the economic contribution of the charitable and non-profit sector in Canada. Previous meetings were held on April 16, 2018 and April 23, 2018, as reported in the April 2018 Charity & NFP Law Update.
The witnesses from Statistics Canada discussed the size and scope of Canada’s charitable and non-profit sector, as well as the financial contribution that Canadians make to the sector through their donations. Various methods used to collect statistics on the sector and measure economic contribution were also discussed, along with statistics on the sector’s share of economic activity, employment, average compensation, as well as figures about the profile of the donors, the amounts donated and how these have changed in recent years.
As the Committee’s study reveals interesting information about the charitable sector, it would be worthwhile for charities to monitor the progress of the Committee ahead of its report due by the deadline date of December 31, 2018.
CBA Makes Submissions to Special Senate Committee
On May 9, 2018, the Charities and Not-for-Profit Law Section of the Canada Bar Association (“CBA Section”) submitted a letter to the Committee offering support and assistance to the Senate Committee. The letter indicates that charities and not-for-profits tend to find the rules that govern that charitable sector arcane and difficult to understand, which has led to charitable resources being unnecessarily tied up with compliance when they could better be used to advance and promote charitable causes. In this regard, the CBA Section provided various observations and suggestions to the Committee.
The letter states that the proposed review being carried out by the Committee is complex due to the different sets of rules governing charities and those governing non-profit organizations, as well as the different levels of government involved resulting in a “patchwork of rules and regulations between the federal rules and those of the various jurisdictions” which, along with the inconsistent use of terminology, such as “charitable purposes” and “charitable activities”, is cause for confusion. In this regard, the CBA Section suggested focusing the Committee’s review on modernizing the rules governing charities under the Income Tax Act (Canada).
Finally, the letter explains that, while the general focus in the US, UK and Australia is on promoting charities’ purposes, Canadian rules “focus on the activities of Canadian charities, such as on direction and control by charities of their own activities.” This has resulted in lower effectiveness and inefficiencies, as Canadian charities expend large amounts of time and resources on compliance as opposed to charitable works. The letter concludes by offering further elaboration on these challenges and the CBA Section’s proposals on how the rules could be clarified and simplified.
Read the May 2018 Charity & NFP Law Update
by Dev User | May 31, 2018 | Uncategorized
May 2018 Charity & NFP Law Update
Ontario Bill 31, Plan for Care and Opportunity Act (Budget Measures), 2018>
On May 8, 2018, Ontario Bill 31, Plan for Care and Opportunity Act (Budget Measures), 2018 (“Bill 31”) received Royal Assent. As discussed in the March 2018 Charity & NFP Law Update, Bill 31 implements amendments to the Assessment Act introduced in the 2018 Ontario Budget to extend the property tax-exempt status available to public schools, places of worship, municipal town halls, and other community centres, to non-profit child care centres located in the same property tax-exempt land.
Child, Youth and Family Services Act, 2017 Proclaimed>
On April 30, 2018, sections 1-280, 294, and 333-349 of Ontario’s Child, Youth and Family Services Act, 2017 (“CYFSA”) and four of its supporting regulations came into force by proclamation. Similarly, January 1, 2020 was named by proclamation as the day on which sections 281-293 and 295-332 of the CYFSA, as well as additional regulations, will come into force. As discussed in the August 2017 Charity & NFP Law Update, as well as the January 2017 Charity & NFP Law Update, the CYFSA replaces the Child and Family Services Act, which has been repealed.
Ontario Bill 3, Pay Transparency Act, 2018 Receives Royal Assent>
On May 7, 2018, Ontario Bill 3, Pay Transparency Act, 2018 (“Bill 3”) received Royal Assent and, in accordance with subsection 22(1), it will come into force on January 1, 2019. As reported in the March 2018 Charity and NFP Law Update, Bill 3 establishes a number of provisions regarding compensation-related information for employees and prospective employees, such as requiring all publicly advertised job postings to include a salary rate or range, prohibiting employers from asking a job candidate about their past compensation, prohibiting reprisals against employees who discuss or disclose compensation, and establishing a framework to require employers with 100 or more employees to track and report compensation gaps based on gender and other diversity characteristics, as prescribed.
Smoke-Free Ontario Act, 2017 and Regulations coming into force July 1, 2018>
The new Smoke-Free Ontario Act, 2017 and accompanying regulation O Reg 268/18 will come into force in Ontario on July 1, 2018, repealing the previous Smoke-Free Ontario Act and regulation. A number of provisions of the new Smoke-Free Ontario Act, 2017 adapt the previous legislation to include medical cannabis, such as the exemption available to long-term care homes, retirement homes, and others. Of particular interest to charities and not-for-profits is a provision in the new regulation prescribing an expanded perimeter outside schools, as well as including community recreational facilities as places or areas where smoking, use, or consumption of tobacco, medical cannabis or other prescribed products is prohibited. Community recreational facilities are defined in the regulation as enclosed public places owned or operated by a corporation incorporated under Part III of the Corporations Act (“OCA”) or under the Canada Not-for-profit Corporations Act (“CNCA”) or a predecessor of that Act, an organization that is a registered charity under the Income Tax Act (Canada) (“ITA”), or the Province or a municipality (or an agent thereof), where the place is primarily used for the purposes of providing athletic or recreational programs or services to the local community, and the place is open to the public whether or a not a fee is charged for entry.
New O. Reg. 232/18 Inclusionary Zoning under Planning Act>
On April 12, 2018, a number of provisions on the Promoting Affordable Housing Act, 2016 were proclaimed in force, including new subsection 16(4) of the Planning Act, which requires the official plan of municipalities prescribed under the Planning Act to contain policies that authorize inclusionary zoning with regard to affordable housing. Although the Planning Act and its Regulations do not define “inclusionary zoning,” the Ontario Ministry of Municipal Affairs describes it as “a land-use planning tool that a municipality may use to require affordable housing units (IZ units) to be included in residential developments of 10 units or more.” New regulation O Reg 232/18 also came into force on the same day and it provides an exemption from inclusionary zoning by-laws to, among others, developments proposed by or, under certain conditions, in partnership with “non-profit housing providers”. The regulation defines non-profit housing providers to include, generally, corporations without share capital under the OCA or the Ontario Not-for-Profit Corporations Act, 2010 whose primary object is to provide housing, as well as registered charities and non-profit organizations within the meaning of paragraph 149(1)(l) of the ITA whose land is owned by the organization and to be used at least partially as affordable housing.
Regulations under Child Care and Early Years Act, 2014 Amended>
On March 1, 2018 a number of amendments to Ontario Regulations 137/15 and 138/15 under the Child Care and Early Years Act, 2014 came into force, with several amendments coming into force on July 1, 2018. Following the consultation process of Proposal 17-EDU004 from October 2, 2017, the amendments include the revocation of Schedule 2, dealing with age group ranges and the ratio of employees to children, as well as changes to the emergency contact information for parents, financial records, and extends the obligation not to permit the prohibited practices in section 48 of regulation 137/15, such as corporal punishment of a child, to individuals other than licensees.
Quebec Bill 175, An Act to amend the Taxation Act, the Act respecting the Québec sales tax and other legislative provisions>
On May 9, 2018, Bill 175, An Act to amend the Taxation Act, the Act respecting the Québec sales tax and other legislative provisions (“Bill 175”) was introduced in the Quebec National Assembly. Bill 175 makes amendments similar to those made to the ITA and the Excise Tax Act (Canada) by federal bills assented to in 2016 and 2017, including changes to the rules relating to donations to charities with regard to the taxable supply of property or a service that is included in determining the amount of an advantage to a donor.
Saskatchewan Bill 128, The Provincial Sales Tax Amendment Act, 2018>
On May 30, 2018, Saskatchewan Bill 128, The Provincial Sales Tax Amendment Act, 2018 (“Bill 128”) received Royal Assent. Bill 128 adds a new exemption from Provincial Sales Tax (“PST”) for “prepared food and beverages sold by charitable or non-profit organizations at a community concession in the circumstances prescribed in the regulations.” The regulations under The Provincial Sales Tax Act are currently silent on this matter. This change follows Information Notice IN 2017-21 (the “Information Notice”), issued December 2017 by the Government of Saskatchewan’s Ministry of Finance, clarifying how the exemption from PST for charitable and non-profit organizations included sales of food and beverages at a community concession, subject to a number of conditions listed in the Information Notice.
Read the May 2018 Charity & NFP Law Update
