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With vicarious liability now available as a legal tactic, following the recent Supreme Court of Canada ruling, youth oriented organizations are particularly vulnerable to lawsuits launched by victims of sexual abuse committed in their "environment", even when an organization did not behave negligently. The words of the court imply that the mere existence of an organization for youth creates and fosters the risk that leads to harm. This threatens the survival of small nonprofit groups that do good work in our communities.

Should legislation be enacted to limit the liability of such organizations when negligence can not be demonstrated? What, if any, limits should be placed on victims' legal recourse? What should organizations be doing to reduce the possibility of vicarious liability. Are there other kinds of organizations that may be in jeopardy due to this ruling?


This is a thorny, topic, indeed, which presents a three-horned dilemma for those who care about vulnerable people:

1) No one wants to see all youth-serving groups go out of business for fear of being sued, particularly those which provide emotional or other supports to youth at risk. Obviously, that would result in a lot more misery and unmet needs in the short term, and more social problems in the longer term.

2) But we mustn't be so defensive about the inherent goodness of the nonprofit sector that we enable pedophiles to hide behind its folds as they commit the very sort of atrocities these groups are trying to protect the children from. That's just being naive, and it can result in our sector unwittingly more harm than good; perhaps it already has.

3) Nor should we be too quick to deny the victims of sex-abuse the right to be compensated for their abuse simply because the agencies which employed the abusers were well-intentioned. That seems unjust, from the victims' point of view: they can sue someone who can pay if they were molested in a public school, or while under government care; or if it was by the employee of a privately owned facility like the Maple Leaf Gardens; but not if it happened in a church-run facility or any other sort of charity?! That just adds insult to injury. And this could also lead to the demise of nonprofit youth-serving organizations in the longer term, as no right-thinking family or government would want to entrust their charges to agencies which are officially shielded from bearing some of the risks of their employees' misbehaviour.

None of these options are palatable, but we shouldn't be so repulsed by the first that we risk landing on the others by default. That's why the BC courts and the Supreme Court of Canada tried to steer to a middle ground: one which establishes the right of abused individuals to seek compensation from the agencies which placed them at a particularly high degree of risk, whether those agencies were driven by profit or not.

Unfortunately, many who work in the sector have only heard the result of Bazley v. Curry, the latest residential school decision, without studying its particulars. And many haven't heard a thing about Jacobi v. Griffiths, a related case which did not find a nonprofit agency to be at fault. And so they fear the worst: option 1.

But before we get all up in arms and condemn these decisions, and before we try to persuade legislators to abolish the notion of vicarious liability applying to nonprofits altogether, we would do well to actually read these decisions in their entirety.

When we do read these decisions carefully, I believe we'll find that both of these statements given in the setup for this "Speak Out" issue are misleading:

"The words of the court imply that the mere existence of an organization for youth creates and fosters the risk that leads to harm. This threatens the survival of small nonprofit groups that do good work in our communities."

Let's start with the latter. The reality of the litigious landscape undermines the suggestion that it'll be the small nonprofits which will suffer as the result of this decision. From what I gather from my research into this matter, this is a "deep pockets" issue: vicarious liability only really comes up when the direct perpetrator of the wrong is uninsured and/or unable to pay, and so the litigators go after the bigger fish -- the employer, who presumably does have assets. But small groups typically do not have assets, either: they, too, fall under the "You can't get blood out of a stone," rule. So it seems unlikely that this decision will open the floodgates. (Of course, the trustees of such organizations may be persons of means and thus be vulnerable to lawsuits, which is why some US states have enacted legislation limiting or eliminating vicarious liability suits against Board members who have acted with due diligence.)

Regarding the initial claim, it is important to realize that the Supreme Court was actually at pains to point out that it was not ruling that any and every agency which dealt with youth could thereby be found vicariously liable for whatever evil its employees might do to its clients. As they put it, "Incidental connections to the employment enterprise, like time and place (without more), will not suffice." I.e., it's not enough grounds to sue simply because the agency gave a pedophile access to his or her victims. More is required: "the fundamental question is whether the wrongful act is sufficiently related to conduct authorized by the employer."

That's why the Supreme Court found the Children's Foundation to be liable for the sexual abuse perpetrated by its employee at the workplace -- because part of his job involved being intimate with children (including bathing them and tucking them in at night). And it's why, in a related decision posted on the same day, the (narrow) majority did not find the Boys and Girls Club of Vernon to be vicariously liable for the acts of sexual abuse its employee conducted off-site, in his own home: since it was a recreational rather than a residential facility, and thus did not exercise as much power over its clients; since its employees were only intended to have a mentoring but not a quasi-parental role; and since its guidelines expressly forbade employees from having relations with its clients outside the workplace. (see Jacobi v. Griffiths, online at http://www.droit.umontreal.ca/doc/csc-scc/en/rec/html/jacobi.en.html)

Hence, the residential school decision won't automatically apply to little league groups and the like, where everything's done out in the open and with plenty of witnesses around, and where boundaries are clearly established and physical contact with the children by the adults is explicitly discouraged. Thus, I believe it would be premature to call for any sweeping changes to the regulatory framework concerning the imposition of liability, on the basis of the Bazley v. Curry decision. But it should serve as a wake-up call to screen employees and volunteers thoroughly; to implement safeguards such as explicit guidelines, spot checks and confidential surveys; and to be especially vigilante for any signs of wrong-doing, if your organization works with vulnerable groups such as children.

-- Warren Dow, writer / researcher / consultant,

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