A Brief History of Philanthropy at the University of Toronto May 23, 2018

1 A Brief History of Philanthropy at the University of Toronto May 23, 2018 Martin L. Friedland, C.C., Q.C., LL.D., F.R.S.C., University Professor and professor of law emeritus, University of Toronto I have given dozens of talks over the years on a wide range of subjects related to the history of the University, but have never given one on philanthropy. It is an important subject. If it were not for philanthropy, the University of Toronto would not be in the position it occupies today – one of the leading universities in the world. Its ascent in the rankings over the past few decades has occurred during a period of strong private support by individuals, corporations, and organizations. It has taken place on all three campuses, St. George, Scarborough, and Mississauga. Private donations have enabled the University to improve the quality of education and research to an extent which would not have been possible with regular provincial government support, which tends to be distributed equally according to student numbers across the province. In this talk I will give a brief history of philanthropy at the University of Toronto, primarily drawn from my history of the University and for the most part focusing on the past. Private support was relatively unimportant for the University of Toronto in the nineteenth century. Financing the University was thought to be a provincial responsibility. The University’s predecessor, King’s College, had been established in 1827 by the government of Upper Canada and at the same time was endowed with a generous grant of Crown lands scattered throughout the province that could be sold to finance the University. This endowment was transferred to the University of Toronto when the Anglican King’s College was closed down in 1849 and the secular University of Toronto created. The University was to a great extent controlled by the provincial government and was therefore unlike many of the private universities in North America, such as Harvard, Yale and Stanford in the United States, and McGill and McMaster in Canada – that were the result of philanthropic contributions by major private donors. 2 Montrealer James McGill, for example, a wealthy fur trader who died in 1813, bequeathed £10,000 – the currency in those years – and a 46-acre estate on the side of Mount Royal for McGill College, which was formally opened in 1829. The only major donor named on the Chancellors’ Circle wall for most of the nineteenth century is John Elmsley, who in 1853 donated a large block of land to the Catholic Basilian order to erect a parish church, St. Basil’s, along with a college, St. Michael’s, which were both officially opened in 1856. St. Michael’s affiliated with the University in 1881. There were no philanthropic donations for the purchase by King’s College in 1828 of the original St. George campus. It was purchased from private owners using endowment funds for a total of £3,750, a sum about equal to the cost of Bishop Strachan’s home on Front Street. There were also no philanthropic donations for the magnificent University College, constructed in the 1850s. It was built with money from the endowment. The government permitted £95,000 to be used for the building. The University moved quickly and quietly because there was growing concern that the religious colleges would try to block U of T’s use of the endowment, which the other colleges felt should be shared with them. ‘Every stone that goes up in the building,’ the U of T vice-chancellor at the time stated, ‘every book that is bought is so much more anchorage, and so much less plunder to fight for.’ Apart from Elmsley, the only other entry on the Chancellors’ Circle wall for the nineteenth century is the ‘Benefactors following the Great Fire of 1890.’ More than 40,000 books were received. Donors in Britain sent some 20,000 books, including the works of the Brownings donated by their son, a set of Tennyson’s work in eleven volumes donated by the author, and a book on royal residences donated by Queen Victoria. Donations to the University increased after the turn of the century. An alumni association was founded in 1900 and one of its early actions was to raise funds for the construction of Convocation Hall, which opened in 1906. The government of Ontario matched the funds raised by the Alumni Association. Another turning point for the University was the creation by the government of Ontario of a Royal Commission on the University, which reported in 1906 and resulted in the creation of a board of governors and a greater separation of the University from the government. It was composed of public spirited wealthy individuals, who believed in philanthropy and helped set the tone for private giving 3 in the City of Toronto and the University. Nevertheless, financing the University was believed to be the government’s responsibility and the philanthropy was mainly directed at other institutions, not the University itself. The chair of the Commission was Joseph Flavelle, who would become the chair of the board of the Toronto General Hospital and helped raise the funds for the building of the hospital on College Street, which opened in 1913. Many years later, he donated his fine home, now called Flavelle House, to the University. Another wealthy Torontonian on the Royal Commission was Edmund Walker, who later became the chair of the board of the University. He was the head of the Bank of Commerce and throughout his life was heavily involved in various philanthropic enterprises. He was the founder of what is now the Art Gallery of Ontario and was the principal proponent and chair of the board of the Royal Ontario Museum, which opened in 1914 and until the mid-1960s was an integral part of the University. In addition, he helped raise money for social housing in Toronto and various other causes. A further wealthy member of the commission was Goldwin Smith, who had been an academic at Oxford and Cornell and later came to Toronto, where he married Harriette Boulton, the wealthy widow of the former Toronto mayor, William Boulton. They lived in the Grange, an elegant residence which they later donated to the Art Gallery. Because of the change in the culture of giving, we find, for example, the Eatons funding the first named chair in medicine at the Toronto General Hospital and the Gooderham family donating 50 acres of land in the north end of the city to be used for the production of vaccines and antitoxins in the new Connaught Laboratories during the First World War. Immediately after the war, the Alumni Association made plans for a memorial tower honouring those who had served and particularly those who had given their lives in the war. The first site chosen was north of the old library, but the Board wanted that for an extension of the library, which was eventually built after the Second World War with the help of a donation by Sigmund Samuel. The Royal Commission of 1906 recommended a number of new initiatives in the University. To pay for them, it had recommended that succession duties or death taxes, which had been introduced in Ontario in 1892, be used to finance the University of Toronto. The government accepted that proposal and enacted legislation, stating that one-half of the amount collected be given to the University 4 of Toronto – the only Provincial University. A few years later, however, this was capped at half a million dollars a year, so it was not the gold mine that some had hoped it would be. In the meantime, Goldwin Smith died, leaving an estate of $700,000. Unfortunately, he did not leave it to the University of Toronto. He was so annoyed at the Ontario succession duty scheme that he left it to Cornell University. The relationship between the tax system and philanthropy is complex and one that I will not explore in detail here. My tax colleagues at the law school will tell you that the federal government, which had introduced succession duty legislation in 1941, repealed it in the early 1970s after the federal government brought in a capital gains tax, with what is technically referred to as ‘deemed disposition on death.’ In 1997, the federal government wanted to encourage donations to charities and particularly to universities, where, in the words of the 1997 government budget plan, ‘the research facilities at many Canadian universities and research hospitals have not been keeping pace with the demands of world-class research and higher education, and require new investment.’ And so, as the U.S. had done, Canada lowered the capital gains tax rate on donations to charities of securities of public companies traded on an exchange. In 2006, the capital gains tax on such donations was completely eliminated. This encouragement has had a very positive effect on universities across the country. I mentioned Sigmund Samuel. He is an important figure in the history of philanthropy in the city of Toronto and for the University. His father, an industrialist, had been one of the founders of the Holy Blossom Synagogue. Sigmund Samuel attended Upper Canada College and became very friendly with many non-Jewish Torontonians, including Edmund Walker, who involved him in many of the charitable activities in which Walker participated, particularly the Royal Ontario Museum, where Samuel became a member of its board. Walker also brought him into clubs, such as the York Club and other private clubs, where he was their first Jewish member.

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