In the 1970s, Canadian charity law dramatically evolved and became imbedded in the Income Tax Act.  While this is ancient history, I have personal connections with the drafting Working Group at the Department of Finance that I rediscovered. To my delight, after 45 years, I reconnected with one of the drafters in Ottawa this summer.  Aura (Elliott) Vaucrosson was the mother of one of my childhood friends, Jean-Paul, or JP.  At the time, I had no idea about her professional life, and I couldn’t imagine how it would connect with mine.

Legal Background

First, here is the legal history.  Charity law has no business being in the Income Tax Act.  It’s a federal statute, and charity and trust law are provincial responsibilities.  Most provinces, however, had little interest in the regulation of charity.

The Feds first got into the picture in 1935 when a tax deduction for donations was introduced. Previously, Canadians gave without tax benefits, but the change was enabled by the introduction of income tax in 1917.  The system hit some political turbulence in the early 1960s. Parliament investigated stories of charities issuing fraudulent receipts, with special suspicion reserved – in the minds of English-Canadian MPs – for Quebec small town priests. As a result, in 1967, charitable registration was introduced, and Revenue Canada established the Charities Directorate to administer the new regime.

Charities Study Group

The reforms of 1977 were shaped by the Charities Study Group under a government lawyer named Arthur Drache.  Drache was the primary author, but it was a team effort. The members of the Group were Aura Vaucrosson, Michel Lamontagne, and Faye Woodman.  Active from 1972 to 1975, the Group’s recommendations were published as the Green Paper on Charities as part of the 1975 Federal Budget.

The new laws transformed the definition and regulation of charities in Canada. Registered charities were divided into three types: charitable organizations or doing charities; public foundations (arm’s length funders) and private foundations (non-arm’s length funders).  Restrictions on private foundations were introduced to “inhibit what the government felt were abuses.”  The category “qualified donee” and cultural property donation incentives were established.  Also new was the disbursement quota rules, which weren’t fully overhauled until 2010.  Sections 149.1 and 110 (donation deductibility) were born.  In Canadian Tax Treatment of Charities and Charitable Donations (1^st edition 1977), Drache wrote on “tax planning and fund raising” of charitable donations for one of the first times, paving for charitable gift planning.  Charities and donors live within the universe created by Drache and the Study Group ever since.

Personal Connections

I first met Arthur Drache in 1991.  He was the colossus of Canadian charity law, and I learned so much from the man via seminars, plenaries, and via his monthly newsletter Not-for-Profit News.  His loose-leaf bible, Canadian Tax Treatment of Charities and Charitable Donations, remains a standard reference.  (The book evolved into Canadian Taxation of Charities and Donations and is now Charities Taxation, Policy and Practice.) Arthur was also generous with his billable time.

I had no inkling that Aura Vaucrosson was part of this story until 2013.  My gift planner friend Christopher Richardson bought me a copy of the 1977 first edition of Arthur’s book. Ex libris York University Law Library.  Christopher had Arthur inscribe it for me: “Remember: Revenue Canada is not your friend!”.  A vintage Drache sentiment pointedly directed at someone who has a weakness for collaboration. In the preface Arthur thanks the other three member of the Working Group, including Aura Vaucrosson, mother of my school buddy JP.  I was blown away.

Aura M. Elliott Vaucrosson

I vaguely knew that JP’s mom was a senior person at the Department of Finance or, was it Revenue? My mother spoke admiringly about her smart and accomplished friend.  But I was a kid.  I had other things on my mind, like non-stop after school and weekend pick-up soccer, football, and floor hockey games. I spent a lot of time at Aura’s house, which was just next to the Anglican church in Manor Park, Ottawa.  Both families attended.

Aura grew up in Trinidad.  In 1972, she moved from Montreal to Ottawa after her marriage to Mr. Vaucrosson ended.  A single mother with two kids, she bought a Cape Cod suburban house and had a housekeeper to keep it all together.  I remember her house so well – Caribbean art and Trinidadian salt cod stew – so different from my own Anglo-Canadian home. When I received the book as a gift in 2013, my mother told me to reach out to Aura, who was still in the old neighbourhood.  I didn’t.

And then, this summer, there is Aura, now age 90, at my parent’s retirement residence at lunch time.  Fate smiled on me.  Sadly, JP had passed away and Aura was living with his daughter until she recently became my parent neighbour again. I have been able to spend some time with Aura unpacking this tangled tale.  Yes, I was that kid.  Yes, I live in Toronto, not Ottawa. And, yes, I am a charity professional who is shaped by her work.  “Really?”  Yes, really.

Aura worked at Revenue Canada before and after her stint with Finance and the Charities Working Group.  She wrote the English-language interpretation letters published by Revenue’s Montreal office – always over the name of her francophone superiors.  And later she drafted IT and IC bulletins on charity topics.  These interpretative guidance products were the other component of the new charity rules – taking the provisions out of the Act and putting them into plan language for community consumption.

Aura says she became a go-to drafter.  She was called upon by the Assistant Deputy Minister (“he was Japanese”) who one day summoned Aura, three levels down the hierarchy, to receive praise for the clarity of her writing.  Her secret?  Aura said it was her rigorous British education in Trinidad.  My copy of Canadian Tax Treatment of Charities and Charitable Donations is now also inscribed by Aura: “To Malcolm: Both friend and extended family, Aura M. Elliott Vaucrosson.”