Despite Mount Pleasant’s bucolic name, some of the issues surrounding the cemetery recently have been less than… pleasant. The decision to close for Mother’s Day (and the previous closure) due to COVID-19 was controversial. While maintaining social distancing is important, giving residents the ability to use midtown Toronto’s “Central Park” (as one city councilor referred to it as) is also crucial. However, unlike a park, Mount Pleasant is not public. What exactly it is has been the subject of a decade plus legal battle. The battle is over for now, as a recent decision at the Court of Appeal concluded Mount Pleasant was not a charitable trust and did not have to select its leadership from an election of all the householders of Toronto.
Mount Pleasant’s history dates back almost two hundred years. York (as Toronto was then known) had only two burial grounds: one for Catholics and one for Anglicans. As such, the province of Upper Canada passed a law setting up a trust that could buy land for a general burial ground (the “Trust”). In other words, the land was legally owned by the trustees but the beneficial ownership was for the purpose of a non-denominational cemetery. Over the years, more laws were passed with respect to the Trust by the new provinces of, respectively, pre-Confederation Canada and Ontario.
The original trustees of the Trust were selected by the legislature from the ringleaders of the plan to set up the non-denominational cemetery (and who had raised a princely sum of $300 from the public for this purpose). Its successor trustees were to be elected by the “inhabitant householders” of York. A corporation was later set up to be the trustee of the Trust to ensure continuity.
Today, this corporate trustee is known as the Mount Pleasant Group of Cemeteries (the “Corporation”) which owns ten cemeteries interring over 600,000 souls. It is a not-for-profit corporation that charges market (or over market) rates for its services.
While the individuals running the Corporation are sometimes referred to as trustees, this is not quite accurate as they are not the trustees of the Trust, the Corporation is. The Corporation owns the land (as trustee) and the directors are elected to be the Corporation’s ‘brain’. While the directors of the Corporation were originally supposed to be elected by the householders of Toronto (with a provision for interim appointment by the other directors), over the years, the manner of mass election fell by the wayside. It is not entirely clear how the Corporation’s directors are currently elected but it appears to be from the Corporation’s membership (the Corporation’s members are its directors).
No one raised serious objections to the Corporation’s governance structure until 2006 when the Corporation decided it wanted to build a visitation centre in Mount Pleasant. Local residents objected (perhaps because they believed it would change the character of the neighbourhood) and lengthy litigation ensued. In an act of “legal sleuthing”, the residents eventually discovered the original provisions for how the Corporation’s directors were to be elected and commenced a new court proceeding.
The lower court found in favour of the residents, holding that none of the current directors of the Corporation were validly elected: an election of all of the householders of Toronto would need to be held (the court admitted that this would be “awkward”). The lower court also found that the Trust was a charitable trust, with the various obligations that entailed.
The Court of Appeal reversed the lower court’s decision. The current method of selecting directors was fine. The 19th century laws setting up the Trust are badly written (the Court of Appeal kindly understates that they are “not models of legislative clarity”). They must be interpreted these laws, the court needed to give a “fair, large, and liberal construction and interpretation as will best ensure the attainment of the object of the Act.” Selecting the Corporation’s directors via an election of the householders of Toronto, the Court of Appeal held, would be “impractical and absurd.” Aside from not knowing exactly what the territorial limits would be and who the “householders” are, the entire scheme would be cumbersome and costly.
Furthermore, the Court of Appeal found that the Trust was not a charitable purpose trust. As a statutory trust (the Trust was created via statute), “clear statutory language” would be expected if the Trust was to be charity – such language was absent (the Court of Appeal also noted that, unlike most trusts, statutory trusts do not have to comply with the tradition ‘three certainties’ to establish a trust). The Trust was not a register charity with CRA, did not view itself as carrying out a charitable function and on dissolution its assets will be distributed amongst its members.
The Court of Appeal considered extensive case law, as well as a four hundred year old English law known as the Statute of Elizabeth, to conclude that it is not enough for a charity to provide a public benefit, that must be its purpose rather than a private advantage. While the Trust did provide a benefit to the public, this was not its primary purpose. As such, the Trust was not a charitable trust.
While the local residents are likely disappointed by this decision, it makes sense as a practical matter. Hopefully, the stakeholders can all move forward to put the “Pleasant” back into “Mount Pleasant”.
May 18, 2020
by:
