I never thought that I would write an article on why sexual assault and harassment should not be used as a charitable fundraising technique. Then I read press reports from England about the President’s Club Charitable Trust (the “Trust”).
The Trust is an English charity that raised funds for granting to other charities. Apparently, for the past 30 years or more, it has run an annual “men only” fundraising event at a posh London hotel. Proceeds of the event (many millions of pounds) were distributed by the Trust to various children’s charities over the years. We do not know what the event was like in the beginning; but according to an article in the Financial Times newspaper, which sent one of its reporters and an assistant to the event undercover as hostesses this year, the event had turned into an opportunity for inappropriate behavior in the name of fundraising and support of the Trust. The Financial Times reported that, as the evening wore on, “according to the accounts of multiple women working that night, groping and similar abuse was seen across many of the tables in the room.” The Financial Times also described the Trust as having an “enforcement team” tasked with making sure that hostesses were enthusiastic and did not spend too much time away from the attendees.
In the wake of the Financial Times exposé, we understand that the Trust (as it is now) will be wound up and its Chairman has been made to resign from his position with the British Department of Education. There have been questions in Parliament about an MP and a Peer who were attendees. Further career and social repercussions seem likely for attendees. The children’s charities that were to have received this year’s proceeds have begun to refuse to accept them.
We report on this event not to comment on the legalities from the English law perspective, but to offer some preliminary comments on how Canadian law might apply if the Trust’s fundraising event had happened in Canada. Canadian law requires employers to take steps to provide a workplace free from sexual harassment, with significant fines possible. Further, if the charity was setting a stage for sexual assault to occur, criminal consequences could be applicable to the management or the Board. Human rights law could also apply, giving rise to a possible damage claim. Finally, a charity must have exclusively charitable purposes and should not have a collateral non-charitable purpose. If it could be shown that the Trust had as a collateral unstated purpose the making of young women available for the entertainment of the attendees, then it would not be properly charitable at all. It would certainly be possible to conclude, based on the Financial Times reporting, that the misbehavior at the event was so extensive that it had become the actual purpose of the event with the risk of charitable revocation.
An event of this nature is not something that has ever been appropriate for a charity no matter how much money was to be raised through it. How the trustees of the Trust could have thought that it should continue to be operated in a #Metoo world is a question that cannot be answered.
By Robert B. Hayhoe, Miller Thomson
- New qualifying disbursement rules add directed donations anti-avoidance provisions complicate charity regulation - February 6, 2023
- Ontario Court decision is first donor advised fund case and provides some certainty about DAFs - January 31, 2023
- Corporations Canada and new transparency about federal non-profit corporations under the CNCA and new fees for certain documents - December 21, 2022
