Opinion ID: 1058895
Heading Depth: 2
Heading Rank: 1

Heading: The Scope of Charitable Immunity

Text: The doctrine of charitable immunity is firmly embedded in the law of this Commonwealth and has become a part of the general public policy of the State. Memorial Hospital, Inc. v. Oakes, 200 Va. 878, 889, 108 S.E.2d 388, 396 (1959). It is grounded in the public policy that the resources of charitable institutions are better used to further the institution's charitable purposes, than to pay tort claims lodged by the charity's beneficiaries. When a portion of the responsibility [for charity] is borne by the gifts of the philanthropic-minded, so much of the burden is removed from the public. If a portion of those gifts is diverted to the payment of tort claims, without restriction, the spirit and intent of the gifts are, at once, nullified and that much of the burden is again cast upon the public. Hill v. Leigh Memorial Hospital, Inc., 204 Va. 501, 507, 132 S.E.2d 411, 415 (1963). Virginia has favored a limited form of charitable immunity which exempts charitable organizations from some, but not all, tort liability. See Weston's Adm'x v. Hospital of St. Vincent, 131 Va. 587, 610, 107 S.E. 785, 792-93 (1921). A charitable institution is immune from liability to its beneficiaries for negligence arising from acts of its servants and agents, but only if due care has been exercised in their selection and retention. Bailey v. Lancaster Ruritan Rec. Ctr., Inc., 256 Va. 221, 224, 504 S.E.2d 621, 622 (1998). That immunity does not extend, however, to invitees or strangers having no beneficial relationship to the charitable institution. Thrasher v. Winand, 239 Va. 338, 340-41, 389 S.E.2d 699, 701 (1990). Further, the shield of charitable immunity does not extend to liability for acts of gross negligence or willful and wanton negligence. Cowan v. Hospice Support Care, Inc., 268 Va. 482, 488, 603 S.E.2d 916, 919 (2004). To establish charitable immunity as a bar to tort liability, an entity must prove at least two distinct elements. The absence of either element makes the bar of charitable immunity inapplicable. First, the entity must show it is organized with a recognized charitable purpose and that it operates in fact in accord with that purpose. In conducting this inquiry, Virginia courts apply a two-part test, examining (1) whether the organization's articles of incorporation have a charitable or eleemosynary purpose and (2) whether the organization is in fact operated consistent with that purpose.... Davidson v. The Colonial Williamsburg Foundation, 817 F.Supp. 611, 613 (E.D.Va.1993). Second, assuming the entity has met the foregoing test, it must then establish that the tort claimant was a beneficiary of the charitable institution at the time of the alleged injury. See, e.g., Straley v. Urbanna Chamber of Commerce, 243 Va. 32, 33, 413 S.E.2d 47, 48 (1992); Thrasher, 239 Va. at 339, 389 S.E.2d at 700. Thus, in order to determine whether an entity is entitled to charitable immunity, the court first examines the powers and purposes set forth in its charter. Danville Community Hosp. v. Thompson, 186 Va. 746, 753, 43 S.E.2d 882, 884 (1947). If an organization's charter sets forth a charitable or eleemosynary purpose, there is a rebuttable presumption it operates as a charitable institution in accordance with that purpose. Oakes, 200 Va. at 883, 108 S.E.2d at 392. However, if the manner in which the organization actually conducts its affairs is not in accord with the charitable purpose, then the presumption may be rebutted and the bar of charitable immunity does not apply. Danville Com. Hospital, 186 Va. at 753, 43 S.E.2d at 884. Our prior decisions have established a number of factors that are indicative of whether a charitable organization operates in fact with a charitable purpose. [1] These factors are not exclusive and the presence or absence of any particular factor is not determinative. In the final analysis, whether an entity operates as a charity turns on the facts of each case and not on the particular type of institution. Davidson, 817 F.Supp. at 614.