CHARITABLE TRUSTS The Charities Act 2009 was enacted in February 2009 but many sections have yet

to be commenced. The Act creates a new statutory definition of charity (s.3) , provides statutory guidelines for determining public benefit (s.3), creates a new office of Charities Regulator and requires charities to be more accountable with respect to how much money they receive (through fundraising) and what they do with those proceeds. The Act applies to charitable trusts, charitable companieslimited by guarantee and charitable associations. From a charitable trust perspective, it will allow a charity to purchase indemnity insurance for trustees against personal liability arising from any negligence, default, breach of duty or breach of trust committed by them in their capacity as directors or officers of the charity (s.91). There has been one constitutional challenge to the A ct already, which failed but isunder appeal: McNally v Ireland and the AG [2009] IEHC 573. This Act is the culmination of much consultation and research. One of the most definitive reports that looked at the need for reform of charity law was the Law Societys Report, Charity Law: The Case for Reform, published in 2002. It set out the existing problems with Irish law and compared the Irish situation with that in other common law countries [pdf version available in charitable trusts Advantages of being a charity y Charitable trusts do not depend on the exis tence of beneficiaires to enforce them; they are considered to be of a public nature and as such are enforceable by the AG. y Charitable trusts are not subject to the same requirements relating to certainty of objects which must be complied with if a private trust is to be considered valid. Otiginally provided that a trust could be identified as being exclusively charitable in nature, such a trust would be enforced even if the nature of these charitable objects was not expressly delimited. In these circumstances a cy-pres scheme could be framed to ensure that the charitable intention of the donor or testator was given effect to. From a general perspective, charitable status is also desirable as it will facilitate the operation of cy -pres jurisdiction should this be required. If a trust fails to qualify as charitable, this jurisdiction cannot be exercised and a bequest may fail allowing a resulting trust to operate in favour of the donor or his estate. While resulting trusts are intended in theory to gice effec t to the unexpressed but presumed intention of the donor, this may not always be the case, and it is certainly preferable to find a means

of perpetuating the donors charitable intention in as close a fomr as possible to that originally expressed by him. What happens when trust comes to an end- if it is a private trust when private trust fails or we cant carry it out any more, this leads to creation of a resulting trust. If a charitable trusts were to fail and you were to have a resulting trust it would be impossible to find out all persons who gave money and give it back to them. Where you have charitable trust and it fails then ci pres applies. Charitable trusts may be perpetual in nature in so far as the rule against inalienability which has proved a majo r stumbling block in any attempts to enforce non charitable pupose trusts does not apply. However although charitable trusts may be of perpetual duration, they are subject to the rule against perpetuities to the extent that the initial vestingmust be bound to take place within the relevant perpetuity period. Charitable trusts also enjoy significant fiscal immunities in terms of various esemptions from liability to various forms of tax. Exemptions from income tax, corporation tax, CGT, CAT.

In view of the extensive advantages enjoyed by charitable trusts it has benn argued tat some limitation must be placed on their proliferation. While certain judicial statements show a tendency to adopt a benign attitiude to this question, the perceived benefit of the undeserved fiscal immunity has proved a rather thorny issue. An examination of case law in England would suggest that this attitude has led to a restrictive attitude being adopted to the wider question of whether certain trusts should qualify as being legally charitable. The Law Reform Committee of the Law Society of Ireland in its recent report recommended that tax relief should continue to be an automatic consequence of obtaining charitable status, subject to the Revenue Commissioners right of appeal, althoug h it was suggested that the option of tiered tax relief depending on the type of charitable purpose being undertaken should be considered. X p 315 Disadvantage to being a charity New account requires more accountability and transparency . There are 3 Sectors of Civil Society 1. Government provides public provision - the services that people want. 2. If voter isnt happy with public provision of services they can go to market and contract to get private services. 3. If you arent in position to avail of market ser vices you can avail of services from non profit bodies, community bodies, social enterprise and charities. These provide services to those that arent satisfied by services supplied by governmanet and private

organisation. Often these bodies are supported by the government. But there is also competition btwn non profit and for profit because they often operate in the same area. Law EG flac v private legal services. Health insurance- VHI is non profity whereas Quinn are for profit. Given that these organisations perform the same function, why might we favour or encourage charitable activity? 1. It relieves the government of service provision and means government doesnt have to provide all services to all people. Sometimes it can be more efficient to have someone else provide services. 2. Without having to supply all services, the government can look at policy and the bigger picture instead of trying to micro manage all issues. 3. It may enable charities which have good info on the ground to actually deliver good services to right beneficiaries. 4. By encouraging charitable activitiy we hope we will provide additional community benefit. Definition of Charity Under CL in order to qualify as a charitable organisation, you must prove y That the purpose is charitable y That you are only going to engage in those charitable activities it is exclusively charitable y The purpose must have sufficient public benefit - the element is crucial. In the past at CL different levels of public benefit were required depending on what area you were looking at. There was no uniform standard therefore. How do we decide if smt is charitable 1601- Stat of charitable uses passed to regulate charities. Premable to stat set out list of activities that were viewed as being charitable. Activites considered charitable included the advancement of education and relief of poverty. This list was used until 2008 as basis for deciding what is charitable today. It was said if you could come within spirit of preambele you would qualify as charitable. Commissioners for Special Purposes of income Tax v Pemsel (1891) McNaughton J revisited 1601 statute and he set out a list of 4 headings. Claims relating to charitable status were therefore generally determined by considering whether a particular purpos e purpose comes within one of the following 4 broad categories. Trusts for the relief of poverty 1. Trusts for the advancement of education 2. Trusts for the advancement of religion

3. Trusts for other purposes beneficial to the community To be charitable a trust must a. Fall within one of the four heads of charity set out in Pemsel or flow from the spirit and intendment of the Elizabethan Premable OR b. Under Section 3 of the charities Act when commenced AND c. Be for the public benefit d. Be exclusively charitable Re Howleys Estate (1940) Here Gavan Duffy J stated that charity is in law an artificial conception, which during some 300 years under the guidance of some pedantic technicians seems to have strayed rather from the intelligent realm of plain common sense. Whether this statement is justified is open to debate, but it is certainly arguable that the meaning of the term charity in law bears no necessary relationship to a lay person conception of the word. Requirement of Public benefit What this classification fails to make clear explicitly is that for a trust to be regarded as legally charitable, it must be of public character and must contain some element of benefit to the public generally. To qualify as public the purpose must eithe r benefit entire community or a sufficiently appreciable section of the community. In effect there are 2 hurdles to overcome, first an element of benefit, second, an element of public benefit. The concept of public benefit varies considerably as between th e different categories of charitable trusts: in the case of trusts for the relief of poverty it has been greatly modified as a result of judicial intervention, and in this jurisdiction in the case of trusts for the advancement of religion the 1961 Act provides conclusively that such a trust will occasion public benefit. Also the requirement may differ as between different types of trust of category 4 and the point has been made that it seems anomalous to speak in terms of a public benefit requirement in this category as it is defined in terms of trusts for the benefit of the community. This category has been subjected to the most rigouress interpretation of the public beneft test has been applied. The Courts have increasingly inferred that trusts falling within the first 3 categories will be charitable unless the contrary is shown. (Re Worth) While this certainly reflects the position in relation to trusts in category 1 and 3, trusts for the advancement of education have often not qualified for charitable staus because of failure to satisfy the public benefit requirement. Meaning of Public Verge v Somerville (1924)

This set out that for a gift or trust or or other will only qualify as charitable provided that it is for the benefit of the public generally or of an appreciably important class of the public. Re McEnery (1941) This sets out that courts of Equity have been consistently insistent on the public character of legal charity, importing a benefit to the community, or a section of the community In real terms we are looking for sufficient emotional distance- you must be stranger and not looking to be repaid. Requirement to be public seems to suggest that you need a large group of ppl. But case law shows that you do not need that many people. It is more important that they are distant from you. Public requirement is respected under most headings. However most leeway is given in area of relief of poverty. This was overlooked because under charity law it was poss to set up charitable trust to look after own relations. This poor relation exception was extended to cover poor employees as well.

Re Scarisbrick (1951) Here Evershed J stated that poor relations cases may be justified on the basis that the relief of poverty is of so altruistic a character that the public element may necessarily be inferred thereby; or may be accepted as a hallowed, if illogical exception Re Cranston (1898) Here CA was required to decide whether gifts for certain vegetarian societies were charitable in nature. Maj upheld courts opinion that the objects of the societies could be said to be charitable within the legal sense of the term. The court believed that the view of the donor should be decisive in determining whether a gift fell within the category of other purposes beneficial to the community provided that this purpose is not immoral or illegal. the benefit must be one which the founder believes to be of public advantage, and his belief must be at least rational, and not contrary either to the general law of the land, or to the principle of morality. A gift of such character, dictated by benevolence, believe to be beneficient, devoted to an appreciably important object will in my opinion, be charitable in the eys of the law. Homes dissented and thought this was dangerous path to tread.This says we can consider views of donor. The Personal Nexus Test Re Compton (1945) Dingle v Turner (1972)

The Meaning of Benefit There has traditionally been a divergence in the position adopted by the judiciary in Ireland and England in relation to the test which should be applied by the courts in determining whether a person satisfies the requirement of being beneficial to the com munity to the extent that it may be regarded as being charitable in law. Irish authorities suggest that a subjective test should be applied and due weight should be given to the donors view. Of the charitable nature of his bequest provided that this purpose is not obviously illegal or immoral. However the accepted approach now in England is to adopt an objective test and allow the court to form an opinion on the issue based on evidence before it. While this subjective approach was at one time favoured i n England, it would now appear in that jurisdiction that the donors intentions and beliefs as to the charitable nature of the bequest which he is making are not factors which a court may take into consideration. This view is illustrated by statements made by Russel J in Re Hummeltenberg (1923) He referred to the views of the majority judges in the Irish CA in Re Cranston, and stated that although he agreed with them in so far as they declared that the personal or private opinion of the judge was immaterial, he disagreed with them to the extent that they suggested that it was for the creator of the trust to determine whether the purpose is beneficial to the public. In his view the question whether a gift is or may be operative for the public benefit is a question to be answered by the court by forming an opinion upon the evidence before it. This approach was endorsed by Lord Hanworth in Re Grove Grady (1929) Here it was said that it is the court who must decide whether benefit to the community had been established. He said that the issue does not depend on the view entertained by any individual. either by the judge who is to decide the question or by the person who makes the gift The courts in this jurisdiction will likely continue to apply the dicta of fitzgibbon in Re Cranston and give due weight to the donors intention in deciding the question of whether a trust is likely to benefit the community. 1. Trusts for the relief of poverty poverty is a relative concept as set out in Re Coulthurst (1951)- this set out that the test for poverty is relative Here Evershed J held that poverty does not mean destitution. It may not unfairly be paraphrased as meaning persons who have to

go short in the ordinary acceptation of that term, due regard being had to their status in life and so forth. Therefore it is clear that poverty is a relative terms and depends on how far you have fallen from your previous position. Thus in one instance a person might be poor where they havent enough food but someone else by reference to their previous standing may be in poverty if they are used to a rich lifestyle and subsequently are forced to live a more ordinary lifestyle and get the bus etc. Under CL very low threshold of public benefit was required. Re Segalman deceased (1996) Here Chadwick J accepted that a gift to poor and needy members of a class of the testators relatives was a valid charitable gift for the relief of poverty. He stated that the evidence suggested that most of the members of a class are comfo rtably off, but not affluent and that like many others they may need a helping hand from time to time to overcome some unforeseen crisis. Histed has commented that the court has come perilously close to implying that an occasional problem of expenditure exceeding income i s sufficient to qualify a class member as poor. She states that even though this was presumably not the implication intended the tone of the judgement does suggest a more flexible approach to the poverty requirement. IRC v Baddeley Stated that there may be a good charoty for the reliefof persons who are not in grinding need or utter destitution and a trust to provide for persons of limited or reduced means may come within the ambit of this category. Here it was noted that the need which is to be relieved by the chartable guft must be attributable to the condition of the person to be benefitted. Joseph Rowntree Memorial Trust Housing Association Ltd v AG (1983) Here schemes provided accommodation for disabled and elderly people but it would have equal application to trusts for the poor and would seem to rule out any gift which does not go towards alleviating their condition of poverty. Under the scheme the housing was subsidized by the trust but the residents also paid a fee. The court held just because residents paid a charge didnt mean that the trust wasnt charitable. Court thought it was more important to examine where money went- did it enrich someone? Here money used to provide service and court held that this was acceptable. Bryant trust Board v Hamilton City Council

This case held that profits do not make qualification as a trust under this head impossible but the destination of those profits is important. What about public benefit? It is important to distinguish a gift to specified poor individuals from a gift to a class of poor. Trusts in the former category are not chariable in nature while those in the latter are, even where this class is of limited scope. At this point one must consider the public benefit requirement in trusts for relief of poverty. It is fair to say that the comment made by Martin that the requirement in this category has been reducedalmost to vanishing point is an accurate one. This position has come about as a result of the development of the category of so called poor relations trusts, whereby a donor or testator may create a valid charitable trust to benefit those of his relatives who are in straightened financil circumstances. These cases are recognised as forming an exeption to the general principle laid down by lord greene in Re Compton that a gift under which the beneficiairies are defined by reference to a purely personal relationship to a named proporitus, cannot on principle be a valid charitable gift. A justification for these types of trust has been suggested by Evershed in Re Scarisbrick (1951) Here he states that poor relations cases may be justified on the basis that the relief of poverty is so altruistic a cha racter that the public element may be inferred or accepted as a hallowed if illogical exception. These types of trusts have ome to be regarded as anomalous exceptions to the public benefit requirement which attaches to charitable trusts. In this case a tr ust to benefit poor relations of the testatrixs son and daughter who in the opinion of the survivor of her children shall be in needy circumstances, was upheld as a valid charitable trust. Re Segalman deceased (1996)- another example of a trust for poor relations being upheld Here Chadwick LJ accepted that a gift to poor and needy members of a class of the testators relatives, which was not to close until 21 years after his death, was a valid charitable gift for the relief of poverty and it was not disqualified from being such by the restricted nature of the class. At the time of the hearing there were 26 members of the class and and it was reasonable to assume that at the end of the period of 21 years from the testators death, the class would be larger. Held that a gift for the benefit of the poor is a gift for the relief of poverty and that such a gift is no less charitable because those whose poverty is to be relieved are confined to a

particular class limited by ties of blood or employment. He cited Scarisbrick to the effect that the true question must be whether the gift was really for the relief of poverty amongst a class of persons or merely a gift to individuals with the relief of poverty amongst those persons as the motive for the gift. Chadwick co ntinued saying that the basis for disqualification as a charitable gift must be that the restricted nature of the class leads to the conclusion that the gift is really one to the individual members of a class. In his view the gift in the present case was not of that character and had, like the gift in scarisbrick, the feature that the class of those eligible to benefit was not closed on the testators death but remained open for 21 years. He stated that during that period issue of the named individuals born after the testators death would become members of the class. In Chadwicks opinion it was impossible to attribute to the testator an intention to make a gift those after born issue and his intention must therefore be taken to have been the relief of poverty amngst a class of which thy would become members. While Chadwick did not address this point directly, the implication might be taken from his judgment that if the class of persons to benefit was confined to those of the testators relatives living at the d ate of his death, the gift might have been construed as one to individual members of the class which would not qualify as being for the relief of poverty. Histed has commented that Chadwicks opinion seemed to be that the more restricted the clas, the more probable that the gift was one to individuals and in her view the gift was saved by the inclusion of potential after born issue. The relaxation of the public benefit requirement has been extended to trusts for poor employees Spiller v Maude (1886) And Re Gosling (1900) poor members of a mutual benefit society have also ben recognised despite the existence of some personal nexus btwn the donor or the testator and those whom he seeks to beneft Re Hoburn Aero Components ltd (1946) Must be poverty related. Here it was held that the existence of the quality of the poverty amongst those whom it is sought ot benefot must be clear. Here trusts for employees failed to qualify as charitable where this had not been evidence Oppenheim v Tabacoo Securities Trust (1951) Must be poverty related

The decision of the HOL below clearly confirms that trusts for the benefit of poor employees will be recognised as valid charitable trusts. Dingle v Turner (1972)-Poverty related survived Here the testator directed trustees to apply the income of a fund for the purpose of paying pension to poor employees of his firm who were at least 60 years of age or incapacitated. HOL upheld the gift as being a charitable trust. HOL held that this trust was another exception to public benefit requirement. Cross rejected the argument that the trust in question should not be recognised as charitable despite the fact that the company was relatively small with only 600 employees. Cross stated that poor relations and poor employees trust have been recognised for many years an d it was not for the HOL after many of these trusts had been established to change status quo. 2. Trusts for the advancement of Education Trusts for advancement of education have long been recognised as charitable in nature, however the concept of what is educational in the sense of what will be recognised as legally charitable, has been widened considerably over the last 50 years by the process of judicial interpretation. Education has thus been given a broad meaning and is not limited to formal school o r college education. It covers aesthetic education (culture the arts), research (scholarly, literary, scientific) music (Re Delius) and it has even been stretched to cover sporting activities. 2 distinct approaches to what constitutes education in Englan d. Scope Re Shaw (1957)- narrow view This concerned a direction under the will of George Bernard Shaw that his trustees should use his residuary etstae to provide for research into the advantages of reform of the alphabet (to create 40 letter alphabet.) Harman J stated that if the object be merely the increase of knowledge that is not in itdelf a charitable object unless it be combined with teaching or education. He found that these latter elements were lacking in the case before him and also concluded that the objects were not beneficial to the community in a way regarded as chartiable in law. If this is private trust it wont be enforceable and will result back to estate. Thus here it was held that the trust failed to advance education. It was held that accumulation of private knowledge isnt charitable, to qualify as charitable you have to share or disseminate knowledge. Re Hopkins Will Trusts (1965)- expansive view Here a gift to a society to be applied to the task of finding the Bacon Shakespeare manuscripts was held to be a valid charaitable

trust. Wilberforce held that in order to be charitable research must be of educational value to researcher OR be directed so as to lead to smt whoch will pass into store of education material- education in this last context extending to the formation of literary taste and appreciation. Thus Wilberforce accepted that research of a purely private nature would not normally be educational, research of the character proposed in the case before him did not fall into this category as it was likely that the results of the research would fall into the public domain. The point that education requires more than just accumulation of knowledge and must involve some element of sharing or publication was reiterated in Incorporated Council for Law Reporting for England and Wales v AG (1972) Buckley J commented that the concept of advancement of education must extend to the improvement of a useful branch of human knowledge and its public dissemination. Royal Choral Society v I RC (1943) (singing) Here court upheld a trust to promote the performance of choral worksas qualifying under the advancement of education head. Green said he disagreed with the narrow conception of education as meaning a teacher instructing a class and conl cluded that in his opinion a body of persons established for the purpose of raising the artistic state of the courtyis established for educational purposes. Re Shakespeare Memorial Trust (1923) (theatre) Here a trust was established to build national theatre to perform shakespeare to revive English classical drama and stimulate art of acting. This trust was held by the court to be charitable trust for the advancement of education. Re Shaws will Trusts (elocution) This was a testemenetary trust in the will of widow of Bernard Shaw. Vaisy J upheld the validity of a gift for bringing the masterpieces of fine art within reach of the people of Ireland of all classes in their own country. Sport In 1800s court held sports is not charitable Re Nottage (1895) Here it was sought to set up a perpetual trophy for sailing race. Court held this wasnt a charitable trust.

However a number of decisions have since illustrate that the ambit of education for charitable purposes is not limited to education of the mind and extends to the physical education of those attending school or college. Re Mariette (1915) M left money for boarding school to provide school with sports equipment andfacilities. Court held this was a charitable trust because encouraging sport at school was as important as learnig from books. That view was reinforced in IRC v McMullen (1981) Here English FA had set up a trust to promote playing of soccer in schools and universities. It was held that this was a charitable trust. According to judge education should include sporting activity. SO once you can tie sport in with education it is likely that sport will qualify as charitable. But if its just sport per se it will not be charitable National Tourism Development v Coughlan held trust to promote tourists playing of gold wasnt a charitable trust because there was no educational themes. If you are engaged in propaganda chariatable status may be revoeked. Ie if you only give one side of the story you may not be charity. Element of public benefit A gift for the advancement of education will only qualify as charitable provided that it is for the benefit of the public generally or of an appreciably important class of the public. This principle was stressed in Re Compton (1945) CA held that a trust for the education of the descendants of 3 named relatives was not valid as a charitable trust. Green held it failed the public benefit test. He stated that a gift under which the beneficiaries are defined by reference to a purely personal relationship to a name propositus cannot on principle be a valid charitable gift.This became known as the personal nexus test. Oppenheim v Tobacco Security Trust (1951) This concerned the validity of a trust set up to provide for the education of the children of employees or former emplyees of a tobacco co and its subsidiaries. Despite the fact that the number of

employees exceeded 110,000 at the date of settlement, it wa s held that the trust must fail as the distinguishing quality of the class of beneficiairies was a relationship with the name proporitus and for this reason they could not constitute a section of the public. Applying the nexus tests it was held that the trust was not charitable because all the beneficiaries shared common link with employer. Therefore the trust lacked public benefit. Lord Simonds stated These words section of the community have no special sanctity, but they conveniently indicate first, tht the possible beneficiaries must not be numerically negligible, and secondly, that the quality which distinguished them from other members of the community, so that they form by themselves a section of it, must be a quality which does not depend on their relationship to a particular individual. McDermott J dissenting held that the quantum of benefit should have been taken into account here. He held all these ppl would have been educated if this trust had been held valid and this would have been a good thing. He stated that while the Compton test might often prove of value, might equally, if a personal or impersonal relationship remained the criterion, prove to be a very arbitrary and artificial rule. Re Pinion (1965) Here Pinion gifted his house in his will to the English National Trust. He wanted the house preserved as a museum. Court described his collection as junk museum and experts who valued the collection stated that it was of no value. Harman J held there was no public benefit in this case. He said he could conceive of no public benefit by foisting on the public this mass of junk. Re Delius (1957) Here composer Delius widow wanted all his music to be a valuble trust and this trust would dismeninate the music. Rocksborough held that work of composer was meritorious but in reaching the decision he refused to take into account view of donor. He said it was an objective decision and it is for judge to decide whether there is benefit, NOT the donor. Therefore England view opinions of donor as irelevant The reasoning of the maj in Oppenheim has not met with universal approval and the decision of Lord Cross in Dingle v Turner shows an element of empathy with the views expressed by Lord McDermott. In the view of Lord Cross the question of whther the beneficiairies under under a trust constitute a section o the community is essentially one of degree and cannot of itself prove decisive in

determining whether the trust is charitable in nature. A further important reason for questioning the validity of the maj view in Oppenheim put forward by Lord Cross was his view that the decisions in both Compton and Oppenheim appeared to him to have been pretty obviously influenced by considerations of a perceived undeserved fiscal immunity which would be the result of a finding of charitable status Despite these doubts there is no evidence in any decision made by the courts in this jurisdiction of a more relaxed attitude being applied towards this question of public benefit in the context of trusts for the advancement of education, although it should be pointed out that the authorities here have involved a considerably smaller number of potential beneficiairs than those considered in Openheim. Re McEnery (1941) Gavan Duffy J concluded that a bequest to enable the nephews and nieces of the testator and their male descendants to obtain professions was too narrow in scope to be charitable and that the intention of the tetstator was to benefit specific individuals. As he stated courts of equity generally have been consistently insistent on the public character of legal charity, importing a benefit to the community or a section of the community Therefore it is fair to say that the question of the extent of public benefit requirement is no closer to being resolved in this jurisdiction than in England. 3. Trusts for the advancement of Religion Trusts purporting to fall into this category have always been numerous in this jurisdiction. Here in Ireland we have no statutory definition of religion or advancement of religion and thus we rely on CL to supply an answer. Religion is generally taken to be theistic worship of one god or polytheistic- Hinduism. Advancement of that religion normally refers to worship or increased celebration of religious rights. In England the judiciary has not tended to prefer one religion to another in determining the question of whether a trust falls into this category. Cross J commented - as between different religions, the law stands neutral, but assumes that any religion is at least better than none. It is unclear given the Catholic nature of Ireland whether we would stretch the meaning of religion in this jurisdiction to the extent to which it has been in other CL jurisdictions. Keren Kayemeth v IRC (1931)

Here a company was established to acquire land in holy land for the resettlement of jews. Founders of company argued that they were advancing jewish religion and that there company was thus charitable. Hanworth J rejected claim. He described the advancment of religion as the promotion of spiritual teaching in a wide sense and the maintenance of doctrines on whih it rests and the observances that serve to promote and manifest it These views echoed in Grand Lodge of Freemasons v Holburn Burrough Council (1957) Here court held that activities of freemasons didnt advance religion. Freemasons argued that members had to have faith in god and believe in good works and that these tenets would make them charitable. Court held these 2 reqs didnt advance or promote religious belief. Donovan says that advancing religion means to promote it and spread message even further among mankind and take positive steps to sustain and increase belief. Issue of public benefit Public benefit causes big difficulty when we consider religion. A lot of case law in Ireland and England relate to Catholic beliefs. Gifts for the celebration of Mass In Ireland it is common that you send a mass card - the idea is that deceased gets benefit of mass and those who attend get benefit of mass. But it is very difficult to prove this benefit. This has perplexed English and Irish courts and they have taken different routes. England The legality of such gifts was doubtful in England, Re Caus (1934) Held that gifts for the celebration of masses were charitable. Gilmour v Coats (1949) The findings of HOL in this decision led to doubts about the validity of the Caus decision. Re Hetherington (1990) Browne Wilkinson confirmed that a gift for the saying of masses is charitable since it is for a religious purpose and contained the necessary element of public benefit because in practice the masses would be celebrated in public. While he stressed that the celebration of a religious rite in private would not contain this essential public element, he made it clear that where either construction was possible the gift was to be construed as one to be carried out only by charitable means- viz. celebrated in public.

Ireland Commissioners of Charitable donations and Bequests v W alsh (1823) Validity of a gift for saying masses was recognised here. AG v Delaney (1875) Held that bequest for masses were not charitable on the basis that there was no stipulation that the masses be said in public. Palles CB commented thatif the will had prescribed that the masses should be celebrated in public, he would have accepted them as being charitable. The reasoning suggested that the charitable nature of such gifts depended on whether a stipulation was made that they be said in public although in a number of subsequent cases, gifts of this nature failed even where the inference was that they should be celebrate in public. Relied on Cocks v Manners Held that smt is only charitable if there is public benefit but if there is public benefit, you must be able to prove it. AG v Hall (1897) Reiterated view that where a gift contained a direction that the masses be celebrated in public, such gifts should be regarded as charitable. Resolved in OHanlon v Logue (1906) This reverses Delany. CA upheld the charitable nature of the gift and made it clear that that a bequest for the saying of masses, whether in public or not, constitutes a valid charitable gift. In what was described by Brady as a remarkable volte face since his judgment in Delany, Palles CB concluded that the view which he had expressed in the earlier case, that the only element if public benefit in the celebration of the mass is the edification of the congregation, was too narrow and failed to appreciate it as a gift from god. This was put into charities act 1961 and was revised and update d in the new act S 3(4) It shall be presumed, unless the contra ry is provd, that a gift for the advancement of religion is of public benefit S 3(5) The authority shall not make a determination that a gift for the advancement of religion is not of public benefit without the consent of the AG.

S 3(10)- for the purposes of this section, a gift is not a gift for the advancement of religion if it is made to or for the benefit of an organisation or cult The principal object of which is the making of profit, or That employs oppressive psychological manipulation Of its followers or For the purpose of gaining new followers. This section was designed to prevent scientologists from enjoying benefits of low tax. 4. Any other purpose beneficial to the community This category can be described as the most dfficult of Lord McNaughtens classes of charitable trust to define and delimit and embraces purposes which do not fall within any of the three categories already considered but which are nevertheless beneficial to the community in a way recognised by the law as charitable. The range of trusts that may qualify under this heading is enormous and while it is not possible to classify them strictly under different headings, by and large the types of trusts which will be enforced fall into one of a number of categories which will be considered below. Indeed 50% of charities come under this heading. X At common law, under the fourth heading there is an additional burden of proving not only that the proposed activity will benefit the community but also that it is a charitable activity itself. The extended list of purposes beneficial to the community under s. 3(11) of the Charities Act 2009 should help clarify the law in this respect. There has been very little case law in Ireland on the issue of charity and whole definition of charity stagnated because judges didnt get an opportunity to develop it. Promotion of health, environmental issues, animal rights and most new ventures that dont fit under preceding 3 headings fit under this heading. Locality trusts were you would set up charitable trust for village Locality: AG of Cayman Islands v Wahr-Hansen (2001) Lord Browne-Wilkinson There is a limited class of cases where gifts in general terms are made for the benefit of a named locality or its inhabitants. For reasons which are obscure, such cases have been benevolently construed. They are now so long established that in cases falling within the very circumscribed description of gifts for the benefit of a specified locality they remain good law. Gifts for the aged, disabled and sick While the preamble to the English Statute of Charitable Uses refers to the relief of aged, impotent and poor people, the Irish statue

specifically mentions the relief or maintenance of any man ner of poor, succourless, distressed or impotent persons. Kingsmill More J held that impotent includes sick or injured persons in Barringtons Hospital In the context of the English statute, it has been held that these words should be read disjunctively and this approach now appears to be well established. This issue does not arise in relation to the interpretation of the Irish Staute as the words themselves are framed disjunctively. Although some decisions appear to support appear to support the view that it is a sufficient charitable purpose simply to benefit the aged or the sick without more, it is generally accepted that the trust must be for the relief of a need attributable to the condition of the persons to be benefitted. This point was emphasized in Joseph Rowntree v AG (1983) Here a scheme to build self contained but sheltered dwellings for the elderly was found to be charitable in nature. This point was also highlighted in Byrant Trust Board v Hamilton City Council (1997) Gifts for the relief of the disabled, sick (Re Lewis) and wounded (Re Chaplin) will qualify under this fourth head Advancement of Health and Hospitals A number of cases in this jurisdiction have established that gifts for the sick or to hospitals are charitable in nature. Barringtons Hospital v Commissioner for Valuation (1957) Here the pl hospital sought to challenge the changing of its exemption from rating valuation on the basis that its purposes were exclusively charitable in nature within the meaning of S 63 of the Poor Relief Ireland Act 1838. The issue which had to be resolved by the SC was whether the fact that the hospital admitted a number of fee paying patients could alter this position. The court found that the presence in the hospital of a limited number of patients falling into this category did not detract from the charitable purpose of the institution and concluded that it was exclusively for charitable purposes within the meaning of the section. In practice the more important issue is probably the destination of any profits which may be derived from the hospitals activities and ODaly J laid emphasis in Barringtons case on the fact that no provate profit was derived from the premises by its occupiers. Gleeson v AG (1972) This concerned the charitable status of Vincents Private Hospital in Dublin which operated in conjunction with a public hospital. AG said

they made a lot of money from private hospital and as such they were not charitable. The pls showed that money made in private hospital was used to cross subsidise public hospital and this thus the hospital qualified as charitable. Kenny J said that there is much to be said for the view that a private nursing home which charges fees and is run in conjunction with a hospital and whose profits are applied for the purposes of the hospital is a legal charity. Kenny J reiterated that an institution does not cease to be charitable in nature because its activities benefit the rich as well as the poor and concluded that the private hospital was legally a charitable institution Re Worth Library (1994) Here Keane J placed a fairly flexible interpretation on the concept of a gift for th benefit of a hospital. Here he concluded that the bequest of the library played a role in the advancement of the charity represented by the hospital by providing a haven of quiet intellectual relaxtation for named office holders and as sucj constituted a valid charitable bequest for the benefit of that institution. While Keane J commented that he did not feel that there was any ground for skepticism as to the capacity of the bequest to play a part in the advancement of the charity represented by the hospital, his conclusion is difficult to reconcile with his earlier attitude towards the public benefit question and undoubtedly extends present understanding of what might constitute a gift for the benefit of a hospital Gifts for the advancement of animals Although gists for the benefit of a particular animal are not considered charitable, gifts for the welfare of animals generally or for a particular type of animal are recognised as charitable in law. The rationale behind this is that kindness towards animal s tends to promote the morality of human beings. Armstrong v Reeves (1890) Here Chatterton VC held that the motive of safeguarding animals themselves might be sufficient to bring such trusts within the fourth heading of McNaughtens classifications. Here a legacy to the society for the abolition of vivisection was held to be charitable on the grounds that the society was for the public benefit as it tended to correct and prevent cruelty to animals. Re Grove-Grady (1929) In contrast in England the establishment of some benefit to human beings is of paramount importance. Here Russel LJ said that the validity of gfts in favour of animals depends on the question of whether they produce benefit to manking. Here a testatrix left her

residuary estate on trust to found an animal benevolent society the object of which included the provision of a refuge for the preservation of all animal, birds and other creatures not human CA held that the turst was not chartiable as it lacked the necessary element of benefit to the community, Russel J stating that it is merely a trust to secure that all animals within thin the area be free from molestation or destruction by man. It is not a trust directed to ensure absence or diminution of pain or cruelty in the destruction of animal life. However it is possible that such a decision would not be followed in this jurisdiction. National Anti-Vivesection Society v IRC (1948) Held society not entitled to income tax relief on the grounds that its object was not a charitable one. Faced with a finding of fact in the lower court that the benefit to humanity in allowing vivisection outweighed the incidental suffering to animals, the HOL concluded that a trust which had been found detrimental to society could not charitable merely because of the the testators opinion. The reasoning behind such a conclusion would seem to be that while the protection of animal from cruelty is a charitable purpose, vivisection is a necessary element in medical research and its suppression could not therefore be considered beneficial to the community. These head old charity lasted from 1601 to 2008. New starting point will be S 3 of 2009 Act. Pemsel heads havent disappeared but fourth head has been expanded. Under new statutory definiton there was decision to omit human rights and sporting activity from charitable definition. This flies in face of what our common law neighbours have done. They have all included HR and sporting activities when carried out to improve health, as charitable. S 3 (1) For the purpose of this Ac each of the following shall subject to ss (2) be a charitable purpose a. The prevention or relief of poverty or economic hardship - this allows charity notjust to deal with symptoms of poverty but to attack root causes. This has also introduce d economic hardship. b. The advancement of education c. The advancement of religion d. Any other purpose that is of benefit to the community - this has been exteneded to 11 new heads. This means that charities wont have to prove that they are a charity and have char itable purpose to the same extent. (2) A purpose shall not be a charitable purpose unless it is of public benefit. 2009 new charities act which for first time sets down stat definition of a charity. This was enacted in feb 2009 but only 3 section of act

are presently in force. So most of the sections are as yet uncommenced. Religious charities- advancement of public benefit 2 the English approach how public benefit works in relation to charities. They take a very different approach to iraldned becuae they insist on evidence of benefit cocks v manner if no demonstarable public benefit then not charitable teachin nuns good, praying nuns good. Re Caus (1934) They decided ehre to follow irish case law on this matter. This case held that requests for masses where chartable for 2 reasons Because it enabled ritual act central to religion to be performed. The money that you pay for masses provides stipend for priest and there is punlic benefit in this because you are creating opportunity for mass to be said again in future. Golmore v Coates Here there was gift to enclosed order of nuns. Qu was whether this was a charitable gift. One may argue that it is for advancement o f religion but is there public benefit? HOL held no public benefit because no demonstative benefit. You cannot present this benefit in court As a result of Gilmore in eng irish courts decide to put logue stat form. S 43 charities act 1964 into

Re Hetherington Court gave modern perspective of whether these gifts are charitable Browne wilk- bequests for mass can be charitable if they are said in public. Judge went so far as to say that you didnt put in express private celebtation clause well assume its in public and therefore that it is charitable. Going back to caus- court accepted second reason for providing public benefit. In the UK they have now developed stat definiton of religion, something we havent done in Ireland S 2.3 of charities act 2006 defines religion as including a religion including the beleief in more thnan one god and includes aa religion

that does not involve belief in a god. Thus recently druids were held in Eng to be charitable. There is no stat presumption in favour of religion thus all orgs will have to show public benefit to prove charitable purpose. Prior to 2009 act we relied on 1961-73 Act. There were a number of problems under old law which we sought to fix under new law including There was no definition of charity. There has been little opportunity todevelop definition of charity because charities rarely involve themselves in litigation for PR reasons. There was no registrar or regiuster of charities No legal enetitlement for public to see char ity accounts under law. There were many master who had regulatory riole and when there is fragmented regulation everyone assumed someone else is doing job and this doesnt lead to good oversight. AG is the protector of public interesthasnt been that interested in pursuing charity cases Revenue (tax perspective) play a role but again their focus is fiscal and not regulatory and its unfair to expect them to be regulator of charities because thats notntheir rile Garda issues of fraud referred to gardai. Also you must get permit from gardai if you want to fundrauise in public. CCDB- (additional supports) stat body. Their job was to facilitate administration of charitable trust. In 1973 act it was envisaged that this body would be regulator. However under law they had certain rights but few enforcement powers. Dept community equality a All these bodies had role in oversight of acharitied but not nec effective regulatory regime. Major changes in Charities Act 2009 new stat definition of charity there has been effort to define what we mean by public benefit. When act is fully enforced we will have new dedicated charity regulator and charity appeals tribunal. New appeal body- charity appeal truibunal- this will ct down costs for charities who want to appeal decision of CRA Creation of charity register to enable greater transparency and accountability-Charity register- stating relevant info for all charities in state- names of trustees, accounts and how they performed as a charotyhow they performed in charitable mission. It will now be an offence under the act if you hold yourself out as a charity New requirement for all chairtiies to file annual report on their activities and for most to file annual accounts

Undating of fundraising regulation. Charity sector is goint to regulate themselves to improve fundrasising. Minister can step in if not . What happens when a charity ceases to exist? If dealing with private trust and trust ended we would have resulting trusts situation. In charity we try to avoid resulting trusts arising becuae Itsdifficult to give money back to donors when you dont know who donors are and donors may no longer be alive. Therefore to make this situation workable we have cy pres doctrine. Under this the court can take funds from charity and apply them to another charitable purpose as close as possible to original charitable purpose. Funds are applied cy pres so resulting trusts is avoided. Initial impossibility- Situation where right at beginning of gift it isnt poss to give effect to it. Tests here is that cy pres wil only apply if donor manifests wjhats called a general charitable intention - ie an intention to benefit charity in general so that if shosen method fails anpther can be chosen. It foloows that of donor had intention to benffot specific charity, that donation may not be applied cy pres, the gift will paly and resulting trsust will arise. Re Rymer 1895 Here R in will left legacy to the rector of St Thomass seminary. Purpose of legacy was to eduate prist at St Thomass. therefore it is a specific bequest. However before R died seminary was closed and sold up and all duties dispersed to other seminaries. So when he died and will took effect there was no Saint Thomass. executirs made app to coiurt to find out whether legacy had lapsed and thus it was resulting trusts situation or was it cy pres. Court said this is a case of initial impossibility. Is there general charitable intention? no mr rymer had specific intention just to benefit st Thomas. Therefore no cy pres and gift held on RT for his estate Re Harwood Here testator left 2 bequests in will- 1 for wisebeth soc in society and one for peace soc in Belfast. By the time his will reached probate Wisbeth inst no longer existed. Also Belfast peace soc never existed. Court said Wisbeth was real inst, initial poss. Court held no general chartiabel intention. Therefore gift ail. IN case of belfats no such charity existed and thus this showed general charitable intention and thus this gift could be applied cy pres. Supervevning impossibility- here we have a real charity, gift is given, takes effect, operates fine for a while and then a problem occurs. There is a different test used for each of the above

Court say here the gift vcan be applied cy pres if it is absolute gist to charity and it is a perpetual gift. Once the gift has taken effect we dispense with notion of general chariable intention. Re royal kilmanham hospital KH was founded as charitable inst in 1684. It was set up to support and maintain the old soldiers of charles the 2nds army. Over time those successors died out and when gov assume control of land and buoildings there are no successors of this army around. In 1962 gov sought to apply gift to diff purpose- they passed royal kilmanam hospital act. Purpose of act was to use hospital for defence pusposes. Held this had been gift to charity in 1684, it had taken effect and was absolute and perpetual. Was it absolute and perpetual to apply it cy pres. Church representative body v AG St tamises cathdral KK. So had been given gift of library. They wanted to sell library and use proceeds to repair cathedral. Pls claimed that books were no longer used. Mr O Hanlon notices this was a case of superveving imposs. He found that there was absolut and perpetual gift and agreeing with pls that glibaray had ceased to be effective use he said cy pres applied. Beofre it was very hard to get cy pres- you had to porve that it was virtually imposs to give effect to original charitable donation. It wpuldnt be suff to show that it was inconcencinet or an ineffective use of gift. Therefore it was decieded to reform charitay law and reform criteria for obtaining cy pres. Therefore today there is lower threshold- impossibility has been. S 47 Cy pres can now be applied on a number bas es If you can show its not practical to administer gift in current form The ned has been adequately provided for by other means so you no longer need charitable gift in this area. Or original purpose has ceased to be charitable and may now be considered harmful If the gift has ceased in any way to provide a useful and effective method of using the property. Above are all subject to 1 criterion from common law - you must give due respect for orinigal spirit of the gift. Thats an important policy dec because when someone makes a gift to charity they know whpnthey want to leave it to andif you made it easy to avail of cy pres ppl would be disincentivised to make gifts to charities if they thought it might later be appliued to a different purpose.

S 48 Charities act 1961 This section solves prob that we encountered in Re gillingham bus disaster case. This says that prop which is given wither for specific charitable purposes or specific non charitable purpose, where those purposes fail, that money can be applied cy pres. You have to show 2 things to avail of this section 1. Show money collected belongs to a donor who after such 2. The money belongs to donor who gave written disclaimer of his right to have the property returned. If you are covered by either of those situation the money you collected can be applied cy pres.