The Toronto Star by Hilary Young 17 April 2018
In the days since the Humboldt Broncos tragedy, over $12 million has been raised for victims and families on one GoFundMe campaign alone, making it by far the largest Canadian GoFundMe campaign to date. It may seem too soon to think about how that money should be spent, but already there are expenses to pay.
After 9-11, $7 billion in compensation was given to 5,500 victims and their families. But the process of deciding how to allocate that money was anything but simple. Would a stockbroker receive more than a cleaning lady? Would any insurance payouts that victims received be taken into account? Could a fiancé(e) recover or only a spouse?
Similar decisions will have to be made with the millions of dollars raised for victims of the Humboldt Broncos tragedy.
There is little law governing how the funds should be distributed. GoFundMe has a team working with the fund organizer. (Initially this was a woman from Humboldt, but it is now the Broncos organization itself.)
But GoFundMe has no authority to tell the organizer how to allocate that money, beyond insisting it be used for the purposes stated in the GoFundMe page. (To do otherwise would, in any event, likely be fraud.) The page says it will be used for players and families to help with expenses. Beyond that, it is up to the organizer how to allocate the money. It was recently announced that law firm Aikins LLP will help with this process, pro bono.
We have learned a lot about large compensation funds from experience with other tragedies, such as the Deepwater Horizon oil spill and Pulse nightclub shooting. A GoFundMe campaign for victims of that shooting raised $9.5 million U.S. and it eventually merged with an even larger fund, OneOrlando, managed by a board of directors.
Lessons learned include that it is important that funds be distributed relatively quickly. Billions of dollars were paid to almost 200,000 victims of the Deepwater Horizon oil spill in less than a year. Compared to lawsuits, this is lightning speed.
It is also important that the allocation be seen to be fair, although a process this complex will inevitably leave some dissatisfied.
Funeral and medical expenses are an obvious first priority, although given insurance and other payments, these may already be covered.
Ken Feinberg, an expert on such compensation funds, has suggested that three quarters of the money should go to the families of those who died, with the rest going to the injured. But in my view, more money should go to survivors, especially any likely to have long-term medical expenses.
In fact, this is exactly what board of the OneOrlando fund recommended. It rejected Feinberg’s proposal that the deceased’s families get 75 per cent so that more could be spent on survivors.
The allocation between the deceased and survivors is just one consideration. The organizer of the fund will also have to decide — hopefully in consultation with the families and perhaps the broader community — whether to consider individual factors about victims. Some may have dependants. What about lifetime earnings? How do you assess relative degrees of injury?
Giving the same amount to everyone can seem fair or unfair, depending on one’s values and priorities. The more detailed the assessments, the fairer the distribution may be, but this imposes additional burdens on families and makes the process less efficient.
If more than enough is raised to provide compensation, could some of the GoFundMe money be spent, for example, on hockey scholarships? Although this seems reasonable, it would likely violate the platform’s terms of service.
There is more certainty around how such payouts will affect insurance benefits and damages from lawsuits. Insurance benefits are not reduced because of charitable donations such as those from the GoFundMe site, nor is the right to sue or amount of damages affected. (This is in contrast to the 9-11 fund. Participation in that fund required victims and families to waive their right to sue the airlines, transit authorities etc.).
Some will find it distasteful to even discuss how the money should be spent so soon after the crash. But of course it needs to be done, and the sooner these issues are addressed, the sooner money can flow to the victims and their families.
The money has been donated by more than 100,000 heartbroken people. It is in the public interest that these millions of dollars be spent responsibly. The hard work of deciding how to do that has just begun.
Hilary Young is an associate professor in the University of New Brunswick’s Faculty of Law.