Topics: News, What's New from the Charities Directorate of CRA, Canadian Charity Law, Ethics and Canadian Charities
In the case Mariano v. The Queen 2015 TCC 244 the Honourable Justice F.J. Pizzitelli reviewed in great detail the Global Learning Trust (2004) and the Global Learning Gift Initiative (GLGI) program. These programs are what CRA calls abusive charity gifting tax schemes. For those interested in the regulation of charities and the definition of gift this is a must read case. It discusses gifts and donative intent, fair market value and valuation reports. Mr. Justice F.J. Pizzitelli goes into great detail and analyzes the various positions, their expert witnesses and the conduct of the promoter's advisors.
The conclusion is relatively short:
 Having regard to all the foregoing, I find that the Appellants did not have the donative intent to make any of their gifts, did not own or transfer the property that is the subject matter of the gift in kind, i.e. the Licences, and that the Program was a sham; however even if I am wrong on those issues, I find the value of each Licence donated by the Appellants would actually only be 26 cents per Licence but for purposes of these appeals would have to be set at 35 cents per License based on the Minister’s assumptions in its Reply of that amount.
 Accordingly, the appeals are dismissed, with costs to the Respondent. The parties shall have 30 days to make submissions as to costs if they are not satisfied with the above order as to costs.
The case of Mariano v. The Queen 2015 TCC 244 is quite long but well worth the read if you want to understand why some people are concerned about misuse of charities. Here is a PDF copy of the original decision in Mariano v. The Queen 2015 TCC 244
Although the decision is well written and shows the growing impatience of the TCC with these types of schemes, I have no reason to believe that these schemes are dead. Unfortunately there are too many people still profiting from these schemes. Hopefully with a new government the CRA will focus more resources on these schemes.
Do you require legal advice with respect to Canadian or Ontario non-profits or charities?
Mark Blumberg is a partner at the law firm of Blumberg Segal LLP in Toronto and works almost exclusively in the areas of non-profit and charity law.