CHARITIES

What is charity?

1. “A gift to a general public use,

which extends to the poor as well
as to the rich”, per Lord Camden in
Jones v Williams (1769) 2 Amb. 651.
2. “In its widest sense denotes all the
good affections, men ought to bear
towards each other; in its most
restricted and common sense, relief
of the poor”, Morice v. Bishop of
Durham (1804) 9 Ves. Jr. 399
3. Charity ≠ benevolence, liberality or
philanthropy
4. Religious connotations
5. Highly political (welfare state, “big
 Some historical landmarks…

Preamble of the Charitable Uses Act (1601):

“The relief of aged, impotent, and poor people; the

maintenance of sick and maimed soldiers and mariners;
schools of learning; free schools and scholars in universities;
the repair of bridges, ports, havens, causeways, churches, sea
banks, and highways….”.
Poor Law Amendment Act 1834

Income Tax Special Purposes Commissioners v Pemsel [1891] AC 531

“Trusts for the relief of poverty; trusts for the advancement of

education; trusts for the advancement of religion; and trusts
for other purposes beneficial to the community”
The Beverage Report, 1942 - Support “from the cradle to the grave”

Austerity Britain 2008-present

Charidee!
1. Charities or
charitable
purposes as
the object of a
trust
2. How charitable
organisations
hold property
donated for
charitable
purposes
 State
enforcement

Cy-
Fiscal Près
Perp Advant
etuit ages
y
Here comes the legal bit (concentrate)…

1. Did the settlor or testator

intend to benefit a recognised
charitable purpose?
2. Is the purpose for the public
benefit?
3. Is the purpose political?
4. Is the purpose wholly and
exclusively charitable?
 Room for argumentative manoeuvre

Argument
“The question whether
clinic a trust to further some
purpose is so little Charity
likely to benefit the law “has
“There is no public that it ought to been built
better rule be declared invalid and up, not
than that a the question whether logically,
benignant it is likely to confer but
construction such great benefits on empiricall
will be the public that it y”.
placed upon should enjoy fiscal
charitable immunity are really
Dingle v Turner
bequests” two quite different
[1972] AC 601
Weir v questions”
Crum
[1908]
AC 162
Gilmour v
Coates
[1949] AC
1.
CHARIT
ABLE
PURPO
SE?
 1. Recognised charitable purpose?

a) prevention or relief of a) the advancement of

poverty;
environmental protection
b) advancement of education;
or improvement;
c) advancement of religion;
b) the relief of those in need
d) advancement of health or
because of youth, age, ill-
the saving of lives;
health, disability,
e) advancement of citizenship
or financial hardship or
community development; other disadvantage;
f) advancement of the arts, c) the advancement of animal

welfare;
culture, heritage or
d) the promotion of the
science;
efficiency of the armed
g) advancement of amateur
sport; forces of the Crown or of the
h) advancement of human efficiency of the police, fire
rights, conflict resolution … and rescue services or
promotion of religious or ambulance services
racial harmony or equality e) Any other purposes…
and diversity;
 Old law in
s. 3(1)(m) Any other purposes,
new bottles?
i. that are not within
paragraphs (a) to
(l) but are recognised as
charitable purposes by virtue
of section 5 (recreational and “The law of charity is a
similar trusts, etc.) or under moving subject which may
the old law,
well have evolved even since
ii. that may reasonably be

regarded as 1891”., per Lord Wilberforce

analogous to, or within the in Scottish Burial Reform and
spirit of, any purposes Cremation Society Ltd v
falling within any of Glasgow Corp [1968] AC 138
paragraphs (a) to (l) or sub- “A trust is not charitable and
paragraph (i), or
entitled to the privileges
iii. that may reasonably be which charity confers unless
regarded as analogous to, it is with the spirit and
or within the spirit of, any
purposes which have been intendment of the preamble”,
recognised, under the law per Lord Simmonds in
relating to Williams Trustees v IRC [1947]
charities in England and AC 447
Wales, as falling within sub-
paragraph (ii) or this sub-
paragraph.
 Interpreting the purposes:
The advancement of religion

s. 3(2)(a) in paragraph (c), “religion” includes—

(i) a religion which involves belief in more

than one god, and
(ii) a religion which does not involve belief

in a god
Thornton v Howe (1862) 31 Beav 14
Re South Place Ethical Society [1980] 1 WLR
1565
Varsani v Jesani [1998] 3 All ER 273
R v Registrar General, ex p Segerdal [1970] 2
QB 697
R (appl. Hodkin) v Registrar General
of Births, Deaths & Marriages [2013]
Charity
Commission’s Test:
1. Belief in God(s) or spiritual, or non-secular principles or things

1. Relationship with these expressed by worship,

reverence and adoration – religious rite or service
2. Cogent, cohesive, serious and important in form
3. Capable of providing moral and ethical value or
edification to the public.

Druid Network Decision, CC (2010)

Temple of the Jedi Order Decision,
CC (2016)
 Interpreting the purposes:
The advancement of amateur sport
Angling
Ballooning
Re Nottage [1895] 2 Ch 649
Billiards, Pool
IRC v McMullen [1980] 1 All
& Snooker
ER 884
Crossbow
Rifle &
Pistol
Shooting
Flying
Gliding
Motor
Sports
Parachutin
g
Interpreting the “A poor person is a
purposes: person who cannot
The prevention or reasonably afford to
relief of poverty meet a particular
need by purchasing
at the full cost price
Re Niyazi [1978] 1 the service which it
WLR 910 is the charity’s
Re Coulthurst [1951] purpose to
Ch 661 provide”,
Independent Schools Council
Re Young [1951] Ch v CC [2012] Ch 214
344
Re Segelman [1966]
Ch 171
 Interpreting the purposes:
The advancement of education

“The educated man’s ideas

about education are not
static, but moving and
changing…it is extremely
dangerous to forget that
thoughts concerning the
scope and width of
education differed in the
past greatly from those
IRC v McMullen [1980] 1 All ER 884 which are now generally
Incorporated Council of Law Reporting v A-G
accepted”.
[1972] Ch 73
Re Shaw [1957] 1 WLR 729
Re Hopkins [1965] Ch 669
2. PUBLIC BENEFIT?
 s. 4 CC 2011
(1) In this Act “the public PB In the first sense:
benefit requirement”
means the requirement in “The nature of the purpose
section 2(1)(b) that a itself must be such as to be a
purpose falling within benefit to the community:
section 3(1) must be for this is public benefit in the
the public benefit if it is to first sense. In that sense, the
be a charitable purpose. advancement of education,
referred to in the Preamble
(2) In determining whether the under the guise of ”schools of
public benefit requirement learning, free schools and
is satisfied in relation to scholars in universities”, has
any purpose falling within the necessary element of
section 3(1), it is not to be benefit to the community …”
presumed that a purpose
of a particular description PB in the second sense:
is for the public benefit. “Those who may benefit from
(3) In this Chapter any the carrying out of the
reference to the public purpose must be sufficiently
benefit is a reference to numerous, and identified in
the public benefit as that such manner as, to constitute
term is understood for the what is described
ISC in the[2012]
v CC
authorities as “a section of
PB in the first sense:
Benefit to the community Re Hummeltenberg [1923]
1 Ch
237
“The faithful must
embrace their faith
believing where they
cannot prove: the court
can act only on proof”,
Gilmour v Coates [1949]
AC 426
Neville Estates
Ltd v Madden
[1962] Ch 832
Gibbs v McDonnell [1990]
Ch 1
 PB in the second sense: “In the case under appeal
Sufficient section of the public the intended
beneficiaries are a class
within a class
; they are those
of the inhabitants of a
particular area who are
Indirect benefit? members of a particular
church: the area is
Re Resch’s WTs [1969] 1 AC 514 comparatively large and
populous and the
“it is said that private schools members may be
reduce the burden on local numerous”,
authorities; that is a benefit Excludes the
of which account should be taken. poor? IRC v Baddeley [1955] AC 572
In principle, we think that “I doubt very much whether a trust would be
approach must be
right. But in point of fact, however, declared to be charitable which excluded the
we do not think the point matters poor”, per Lindley LJ in Re Macduff [1896] 2
because the only Ch 451
wider benefit which has been
identified is the reduction in the “it cannot be said that the poor are excluded”,
burden on local per Lord Wilberforce in Re Resch’s WTs
authorities to provide schooling “provision of a benefit for the poor [must
for those attending private
schools. For reasons go] beyond the merely de minimis or
already given …we see this factor (a) token, [but] we do not see that there is
of very little weight and (b) in any necessarily any obligation to give the poor the
case very speculative”,
opportunity to benefit “, ISC v CC [2012]
ISC v CC [2012]
 Personal Nexus Test
Re Compton [1945] Ch
123
Oppenheim v Tobacco
Securities
[1951] AC 297
Poor Relations Not “numerically
Exceptions negligible” and,
Isaac v Defriez (1754) Not dependent “on
Amb 595 their
Re Scarisbrick [1951] relationship to a
Ch 622 particular
Dingle v Turner individual”.
[1972] AC 601 Educational Grants
Association Ltd v IRC
AG v CC [2011]
[1967] Ch 993
UKUT 421
“It is clear from the cases, what is or is not a sufficient
section of the public to satisfy the second aspect of public
benefit varies depending on the nature of the charity: a
sufficient section of the public in relation to an
educational institution may not be sufficient in relation to
a religious institution and vice versa”

PB “is not…fixed; as society changes, so too

perceptions of what is for the public benefit can
change in the future just as much as they have
changed in the past”
Attorney General v Charity Commission [2011] UKUT 421
3. POLITICAL PURPOSE?
Bowman v Secular “The court has no
Society means of judging
[1917] AC 406 whether a proposed
change in the law will
or will not be for the
public benefit”
If “the object of [the
charity] is to alter the
law in a manner
highly prejudicial, as
he and His Majesty's
Government may
think, to the welfare
of the state”
National Anti-
Vivisection Society v
IRC [1948] AC 31
 McGovern v AG [1982] Ch 321

to further the interests of a particular

political party; or
to procure changes in the laws of this
country; or
to procure changes in the laws of a
Charity foreign country; or
Commission, to procure a reversal of government
policy or of particular decisions of
Speaking Out:
governmental authorities in this
Guidance on country; or
Campaigning to procure a reversal of governmentPer
and Political policy or of particular decisions of
Slade LJ
Activity by governmental authorities in a
foreign country
Charities
(2008)
Speaking Out: Guidance on Campaigning
and Political Activity by Charities (2008)

An organisation set up to
An organisation set up
protect the environment
to oppose a new runway
applies for charity
at an airport applies for
registration. The
charity registration. The
organisation carries out a
commission would reject
range of activities,
the application as
including some political
having a political
activity aimed at securing
purpose, as it would
a change in the
oppose the
government’s policy on
government’s policy on
airports. The CC would
airports.
accept the application if it
was clear that securing a
change in government
policy was not the
continuing and sole
activity of the charity, but
1. a health charity promoting the benefits of a
balanced diet in reducing heart problems
2. an anti-obesity charity established to campaign

for the introduction of increased sugar-tax on all

soft drinks
3. a refugee charity, emphasising the positive

contribution that refugees have made to society

and calling for government to enforce existing
legislation that supports the rights of refugees
4. a charity established to campaign against racist

immigration rules and processes

5. a human rights charity whose mission is to promote

human rights in North Korea

6. a human rights charity calling on a foreign

government to observe certain fundamental human

rights, and for the practice of torture to be abolished
7. an organisation which has been established to

protect life and property by the prevention of all

4.
WHOLLY
AND
EXCLUSIV
ELY
CHARITA
conjunctive/disjunctive
and/or
Charity Act 2011, Section 1(1)(a) “For the purposes of the law
of England and Wales, “charity” means an institution which
is established for charitable purposes only”.
Chichester Diocesan Fund v Simpson [1944] AC 341
A-G of the Cayman Islands v Wahr-Hansen [2001] 1 AC 75
Re Best [1904] 2 Ch 354
Morice v Bishop of Durham (1805) 10 Ves 522
Re Eades [1920] 2 Ch 353
A-G of the Bahamas v Royal Trust Co [1986] 1 WLR 1001
 Not For Profit

Re Resch’s WTs [1969] 1 AC 514

ISC v CC [2012] Ch 214
Educational Grants Association Ltd v IRC
[1967] Ch 993
Scottish Burial Reform and Cremation
Society Ltd. Appellants v Glasgow
Corporation Respondents [1968] A.C. 138