The principal issue was whether a body set up by statute and subject to the control of a minister of the Crown was a ‘charity’ within the meaning of section 45(1) of the Charities Act 1960, for which purpose it had to be subject to ‘the control of the High Court in the exercise of the court’s jurisdiction with respect to charities’.
Held: Sufficient control was vested in the High Court despite the fact that the minister had complete control over the running of the board.
Buckley LJ considered the authorities for permitting a charity to act outside its original charitable aims: ‘It has long been recognised that, where a charity is established by an Act of Parliament, the court will not exercise its jurisdiction in any way which will conflict with the provisions of the Act (In re Shrewsbury Grammar School (1849) 1 Mac. and G. 324, 333), but this does not mean that in such a case the jurisdiction of the court is entirely ousted. In In re Shipwrecked Fishermen and Mariners’ Royal Benevolent Society [1959] Ch. 220, Danckwerts J. expressed the view (in which I respectfully concur) that the court has power to sanction a scheme in relation to a charity established by an Act of Parliament in respect of matters not in conflict with the provisions of the Act, and even in respect of those matters which are regulated by Act of Parliament the court can entertain an application by charity trustees to consider whether they should apply to Parliament for an amending Act: In re Shrewsbury Grammar School, 1 Mac. and G. 324. It seems that the position may be similar in the case of a charity incorporated by Royal Charter: In re Whitworth Art Gallery Trusts [1958] Ch. 461.’
Buckley LJ gave a description of the court’s extensive jurisdiction over charities: ‘It is a function of the Crown as parens patriae to ensure the due administration of established charities and the proper application of funds devoted to charitable purposes. This it normally does through the instrumentality of the courts, but this is not the only way in which the Crown can regulate charities or the application of charitable funds. Where a charity has been incorporated by Royal Charter, the Crown may amend its constitution or vary its permitted objects by granting a supplemental charter. Where funds are given for charitable purposes in circumstances in which no express or implied trust is created, the Crown can regulate the application of those funds by means of a scheme under the sign manual. Where the Crown invokes the assistance of the courts for such purposes, the jurisdiction which is invoked is, I think, a branch of the court’s jurisdiction in relation to trusts. In such cases the relief granted often takes the form of an order approving a scheme for the administration of the charity which has been laid before the court, but this is not the only way in which the court can exercise jurisdiction in respect of a charity or over charity trustees. The approval of a scheme of this nature is, so far as I am aware, a form of relief peculiar to charities, but it does not constitute relief of a kind given in the exercise of a jurisdiction confined to giving relief of that sort. The court could, for instance, restrain trustees from applying charitable funds in breach of trust by means of an injunction. In the case of a charity incorporated by statute this might, as was suggested in the present case, be explained as an application of the doctrine of ultra vires, but I do not think that this would be a satisfactory explanation, for a similar order upon unincorporated trustees could not be so explained. Or, by way of further example, the court could order charity trustees to make good trust funds which they had misapplied, or could order them to account, or could remove or appoint trustees, or could exercise any other kind of jurisdiction available in the execution of trusts other than charitable trusts. In every such case the court would be acting upon the basis that the property affected is not in the beneficial ownership of the persons or body in whom its legal ownership is vested but is devoted to charitable purposes, that is to say, is held upon charitable trusts. Any relief of this kind is, in my judgment, appropriately described as relief granted in the exercise of the court’s jurisdiction with respect to charities, and, where the relief is such as to bind the body of trustees as a whole, this would, in my opinion, constitute control of the charity by the court in the exercise of its jurisdiction with respect to charities. I consequently feel unable to accept the suggestion put forward on behalf of the Attorney General that the reference in section 45 of the Act of 1960 to the court’s jurisdiction with respect to charities is in some way confined to its jurisdiction to approve charitable schemes.’
Russell LJ, Buckley LJ, Plowman J
[1973] Ch 173
Charities Act 1960 45(1)
England and Wales
Citing:
Cited – Re: Shrewsbury Grammar School 1849
Trustees of the school had accumulated income in excess of what was required to achieve the objects of the charitable trust, and asked the court how to apply them. Having upheld the contention that what was described as Sir S. Romilly’s Act . .
Cited – Re Shipwrecked Fishermen and Mariners’ Royal Benevolent Society ChD 1959
The court approved a scheme conferring wider powers of investment than those authorised by the statute incorporating the charity: ‘It is said on behalf of persons interested in the charity that the court is empowered to make a scheme to authorize a . .
Cited by:
Distinguished – Gaudiya Mission and others v Brahmachary CA 30-Jul-1997
The High Court had found the plaintiff to be a charity, and ordered the Attorney-General to be joined in. The A-G appealed that order saying that the plaintiff was not a charity within the 1993 Act. The charity sought to spread the Vaishnava . .
Cited – Attorney General v British Museum ChD 27-May-2005
The trustees brought a claim against the Attorney-General seeking clarification of their duties and powers to return objects which were part of the collection in law, but where a moral duty might exist to return it to a former owner. Here drawings . .
Cited – Lehtimaki and Others v Cooper SC 29-Jul-2020
Charitable Company- Directors’ Status and Duties
A married couple set up a charitable foundation to assist children in developing countries. When the marriage failed an attempt was made to establish a second foundation with funds from the first, as part of W leaving the Trust. Court approval was . .
Lists of cited by and citing cases may be incomplete.
Updated: 24 August 2021; Ref: scu.200666 br>