LLB20803_Charitable Trust I 24/03/2019

LEARNING OUTCOME

AT THE END OF THIS TOPIC, STUDENTS ARE ABLE TO:

CHARITABLE 1. explain the nature of charitable trust

2. identify the requirements for a purpose to be

TRUST (I) considered as charitable

3. examine the provisions applicable to constitute a
charitable trust
LLB 20803 SEM.2, 2018/19
MURSHAMSHUL K MUSA

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OUTLINE OF TOPIC

A. Introduction
B. Requirements – must be of charitable nature, must
be for public benefit, exclusively charitable
C. Enforcement

A.INTRODUCTION

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A.INTRODUCTION A.INTRODUCTION
Differences with other express trusts:
No beneficiary principle Concept of cha trust – based on English common law but
Public trusts with influences of from Buddhism, Hinduism or Islam.

Indestructible Malaysia – no local legislation on charities as in UK or

Australia. Only publicly incorporated charitable trust
Courts and AG have power of supervision eg. Amanah Raya Berhad, Public Trustee and those
Charities or Charitable trusts are public trust, expressly created under Sarawak Charitable Trusts Ordinance (Cap
made, meant for large groups or sections of the public for 102)
charity purposes.

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A.INTRODUCTION A.INTRODUCTION
Charitable trusts - express trusts which exist for a purpose
Charitable trust is an exception to the rule that trusts must rather than for identifiable beneficiaries. In Attorney-
have beneficiaries.
General (NSW) v Perpetual Trustee Co Ltd (1940) 63 CLR
Advantages of a cha trust: 209 at 222, Dixon and Evatt JJ stated:
a) Relaxed requirements of certainty of objects.
A charitable trust is a trust for a purpose, not for a person.
- (i) Relaxed test of certainty of purposes as long as general The objects of ordinary trusts are individuals, either
charitable intention clear.
named or answering a description, whether presently or at
-(ii) Public benefit test replaces private trusts certainty some future time. To dispose of property for the
requirement as regards beneficiaries.
fulfillment of ends considered beneficial to the community
b) Relaxed application of perpetuity rules.
is an entirely different thing from creating equitable
- Charitable trusts may exist in perpetuity but remoteness rules estates and interests and limiting them to beneficiaries. In
generally apply to vesting of property in charity trustees.
this fundamental distinction sufficient reason may be
c) Fiscal advantages – numerous tax advantages found for many of the differences in treatment of
charitable and ordinary trusts.
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Difference with Private Trust Difference with Private Trust

Firstly, public charitable trusts do not require certainty 2nd - no need to express a particular mode of
of beneficiary or objects - “charity” is the ideal object. enforcement of the trust. If mode of enforcement cannot
AG will have the right to enforce it. be carried out as specified by settlor, court would allow a
scheme to carry out the charitable trust known as the cy-
Private trust, where if it fails to fulfill the three
pres doctrine. Not available in private trust.
principles of certainties it will be declared as void, &
only objects can enforce the trust. 3rd - charitable trust are given certain tax and fiscal
advantages; which are not available to private trusts.
The income of a charitable institution is exempted from
income tax.

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B. REQUIREMENTS OF A CHA. B. REQUIREMENTS OF A CHA.

TRUST TRUST
Traditional Requirements of a Charitable Trust • Poverty
Charitable • Education
(a) The trust must be of a charitable nature/purpose nature • Religion
/purpose • Other purposes
beneficial to the com.
(b) The trust must be for the public benefit
(c) The trust must be exclusively charitable
• Who constitutes
Public public?
benefit • Applicable test - nexus

• Wholly& exclusively
Exclusively charitable
charitable • Mixture of cha. &
non.cha. purposes

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B. REQUIREMENTS - Charitable Nature/

Purpose
Halsbury’s Law of England (4th Ed) at para 502 :To be charitable a
purpose must satisfy certain tests: it must either fall in the
Preamble to the ancient statute of Elizabeth I (also referred to as
the Statute of Charitable Uses or the Charitable Uses Act 1601) or
within one of the four categories of charitable purposes laid down
B. REQUIREMENTS OF A by Lord McNaghten and derived from the Preamble, it must be
within the ancient statute, either directly or by analogy with
CHARITABLE TRUST – decided cases on the same point, or it must have been declared to
be charitable by some other statute. In addition, it must be both
Charitable nature/Purpose beneficial and available to a sufficient section of the community.
A matter of law and charitable status does not depend on the
motive of the donor no the donor’s own opinion as to what is
charitable / not is relevant.
Court is the one to decide whether a particular object / purpose is
charitable / not.
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B. REQUIREMENTS - B. REQUIREMENTS - Charitable

Nature/Purpose
Charitable Purpose
No statutory definition of charity either under the English Law or
Malaysian Law Sarawak Charitable Trusts Ordinance (Cap. 102): “… any trust or
Reason: not to unduly restrict what matters could be brought grant of or endowment … for any religious, educational or other
under the meaning of charity charitable purpose is a charitable trust …”
To ascertain can be either based on the Preamble to Statute of Charities Act 1993 (UK), Sec 96(1): ‘charity’ means any
Elizabeth/ Charitable Uses Act 1601 - Within spirit or intendment institution, corporate or not, which is established for charitable
of preamble purposes and its subject to the control of the High Court in the
Pemsels’ Case - 4 heads of charity; relief of poverty, advancement exercise of the courts jurisdiction with respect to charities…”
of education, advancement of religion, other purposes beneficial
Charities Act 1993 (UK), Sec 97(1): ‘charitable purpose’ means
to community
purposes which are exclusively charitable according to the law
Can be considered cha either by direct reference to those of England & Wales’
purposed stated or by analogy to them or purposes accepted by
analogy to them as cha. Now cha purposes as under Sec 2 of Charities Act UK 2006

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B.REQUIREMENTS – CHARITABLE NATURE B. REQUIREMENTS – CHARITABLE NATURE

Statute of Charitable Uses 1601 (43 Eliz I, c.4)
Traditional Approach - Charitable Uses Act 1601 the relief of poverty;
The four heads of charity in Pemsel’s Case care of aged persons and the sick;
care of soldiers and mariners;
"Charity in its legal sense comprises four principal divisions:
trusts for the relief of poverty; trusts for the advancement of advancement of education through universities and
schools;
education; trusts for the advancement of religion; and trusts
for other purposes beneficial to the community." repair of bridges, havens, ports, churches and highways;
(Commissioners of Special Income Tax v. Pemsel [1891] A.C. 531, the care of orphans;
at 583, per Lord McNaghten) the maintenance of prisons;
- Relief of Poverty the marriage of poor maids;
- Advancement of Education support for young tradesmen and persons decayed;
the relief or redemption of prisoners or captives; and
- Advancement of Religion
relief for poor persons concerning the payment of taxes
- Other purposes beneficial to the community
The above are known as Pemsel’s head of charity
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B. REQUIREMENTS – CHARITABLE NATURE B. REQUIREMENTS – CHARITABLE NATURE

Statute of Charitable Uses 1601 (43 Eliz I, c.4) Statute of Charitable Uses 1601 (43 Eliz I, c.4)

Gilmour v Coates [1949] AC 426 at 442-3; [1949] 1 All ER Incorporated Council of Law Reporting (Qld) v Federal
848 at 852, by Lord Simonds: Commissioner of Taxation (1971) 125 CLR 659; [1972]
[F]rom the beginning it was the practice of the court to ALR 127: A trust for the not-for-profit publication of law
refer to the Preamble of the statute in order to reports was found to be charitable in the grounds that
determine whether or not it was charitable. The objects the reporting of cases was fundamental to society in the
there enumerated and all other objects which by same way that the maintenance of roads, and the
analogy are ‘deemed within its spirit and intendment’ promotion of agriculture were fundamental and within
and no other objects are in law charitable. That is the spirit of the preamble
settled and familiar law.
Royal National Agricultural and Industrial Association v
Chester (1974) 3 ALR 486 a trust for the breeding and
racing of pigeons failed because there was no analogous
charitable purpose in the preamble.

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B. REQUIREMENTS – CHARITABLE B. Requirements of Cha. Purpose: Trusts

NATURE for the Relief of Poverty
The 1601 Act refers to “aged, impotent and poor people”
Charity means a benevolent act : - not conjunctive.
compassionate/generous intention + action.
Poverty - a vague term; may mean different things to
Legally, a charity does not cover all benevolent acts. different people at different places and time
Must be remembered that the classification is based on To be valid as a gift - does not require that the persons to
convenience sake as charity is a living and evolving be benefited should be destitute, or even on the border
subject according to the needs of society of destitution
May legally covers a person who does not have enough
Need not to be expressly stated as – can uphold gifts for
the poor which are expressed in general or indefinite
language

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B. Requirements of Cha. Purpose: Trusts B. Requirements of Cha. Purpose: Trusts

for the Relief of Poverty for the Relief of Poverty
Sir R. Evershed in RE COULTHURST 1951 Ch 661:- “….Poverty, of
course, does not mean destitution. It is a word of wide and IRC v BADDELEY 1955 1 AER 523 Lord Simmonds set the limit
somewhat indefinite import …. as meaning persons who have to on the extent of comfort and lifestyle that determines ‘legal’
‘go short’ in the ordinary acceptation of that term, due regard poverty: “…There may be a good charity for the relief of
being had to their status in life and so forth.” persons who are not in grinding need or utter destitution …
but relief connotes need of some sort, either need for a
T directed that the income of a trust fund was to be used for home, or to provide some necessity or quasi-necessity, and
the benefit of such widows and orphans of deceased officers or
not merely for an amusement, however healthy.”
ex-officers of a bank, as the Bank considered most deserving of
assistance. A.G.v COMBE 1824 the Court upheld a gift as charitable, with
Held :Although the beneficiaries were not poor in the sense of the intention to relieve distress when it was made for the
being destitute; they were not as well endowed as other benefit of widows and orphans of a particular place.
persons being in the same class they belonged. Valid charitable
gift.

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B. Requirements of Cha. Purpose: Trusts B. Requirements of Cha. Purpose: Trusts

for the Relief of Poverty for the Relief of Poverty – Msia
Must be intended for persons who are actually poor e.g.
RE DUDGEON 1896 74 Lt 618 Stirling J held :“It appears to me dedicated to the ‘poor’, ‘indigent’ and destitute
that the cases cited on behalf of the charity do show this, that
it is not necessary to find poverty in so many words but the RE SYED ALKAFF 1923 2 MC 38 a gift to distribute money
court will look at whole gift, and if it comes to the conclusion among ‘such blood relatives of the testator in indigent
that the relief of poverty was meant, will give effect to it, circumstances’, to ‘distribute the usual meal or rice to the
though the word ‘poverty’ is not to be found in it…..” poor on Friday’ were considered as charitable purposes even
though the trust fails for not being exclusively charitable.
BISCOE v JACKSON 1887 25 Ch.d 460 a gift to establish a soup
kitchen in Shoreditch was construed as a charitable trust to RE HADJEE ESMAIL (1911) 12 SSLR 74 - purposes such as ‘alms
relieve poverty. for the poor’ and ‘maintenance for relatives who might be in
indigent circumstances’ are considered as charitable however
the trust failed for uncertainty of subject-matter of the trust.

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B. Requirements of Cha. Purpose: Trusts B. Requirements of Cha. Purpose: Trusts

for the Relief of Poverty – Msia for the Relief of Poverty

ESTATE OF HJ DAENG TAHIRA BT DAENG TEDELLEH,[1948] MLJ Whatever the definition of poverty used, the gift must be
62 trusts for ‘the burial of any poor Muslim’ and for the yearly made in terms that would exclude those who are not poor e.g.
provision of a feast (kandorie) for the poor persons of the persons of ‘moderate means’ and ladies in ‘reduce
Mohammedan religion were declared as charitable trust. circumstances’ are upheld.
RE GWYON 1930 1 Ch 255, a gift failed on this ground. A
RE ALSAGOFF TRUSTS 1956 22 MLJ 244 a gift for the burial and testator, by his will, directed that the residue of his estate
assistance of the poor and a gift for the maintenance and should be held upon trust to establish ‘Gwyon Boys Clothing
provision of oil or other means of illumination for Rubad Foundation’ to provide knickers for the boys on Farnham
Saadayat Medina (an institution for the relief of poverty) were district aged between 10 – 15 years. No preference was
upheld. indicated by the testator for children of poor parents. Held:
by the Court that the gift did not restrict the claimants to
poor boys, thus it could not be for the relief of poverty and so
failed as a charity.

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B. Trusts for the Relief of Poverty : Trusts for the Relief of

Cases Poverty
Working class : implied intention to relieve poverty in RE
‘Working Classes’ does not seem to imply legal poverty; need NIYAZI’S WILL TRUST 1978 3 AER 785.
to look for intention to relieve poverty
Facts: Gift of £15,000 to be used “for the construction of
HE GREEN & SONS v MINISTER OF HEALTH (NO.2) 1948 1 kb 34 or as contribution towards a working men’s hostel in
Denning LJ was of the view that the term was an Famagusta, Cyprus –valid. Note : considered as a
borderline case as it was decided based on its own
‘anachronism’ not synonymous with poverty. special circumstances taking into account the small
RE SANDERS WILL TRUSTS a gift was made ‘to provide or amount of the gift and the chronic housing shortage.
assist in providing dwelling for the working classes and their RE DRUMMOND [1914] - holiday expenses of work people
families’ resident in the area of Pembroke Dock. Harman J – invalid
held that it was not charitable as the expression “working RE LUCAS 1922 2 Ch 52 a gift of £5 “to the oldest
classes” did not indicate poor persons. respectable inhabitants in Guncille per week” was held
to be charitable as it only involves a very small amount
that only the poor would benefit from it.

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Trusts for the Relief of Poverty: the Aged Trusts for the Relief of Poverty: the Aged

No specific age limit has been set RE COTTAM 1955 1 WLR 1299 a trust to build flats for
persons over 65 years fell within this head of charity.
From decided cases - the sixties age group is the
minimum. RE ROBINSON 1951 Ch 198 a gift for the old people of
Hazel Slade, Hednesford who were over 65 years of age
RE GLYN’S WILL TRUST 1960, a gift was made towards the
was also upheld as charitable.
building and maintaining houses for British women from
the working class, if over the age of sixty. Held: gift is a
charitable one, although persons described as members of
a working class does not necessarily means poor, but it
was upheld on the point of helping the aged.
Reason: in line with the Preamble the Statute of
Elizabeth I; the phrase aged, impotent and poor :
disjunctively

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Trusts for the Relief of Poverty: the B. CHA.PURPOSES: ADVANCEMENT OF

Impotent EDUCATION
Refers to some infirmity or failing such as blindness,
paralysis etc or addiction to drink or drugs Preamble - “the maintenance of schools of learning, free schools
Gifts for the benefit of such persons or institutions which and scholars in universities and the educational and preferment
cater for these problems are charitable. of orphans.”
Current - education include a wide range of object of an
RE LEWIS 1955 Ch 104 a bequest of £100 each to 10 blind educational and cultural nature. Gifts which were upheld as
girls and boys in Tottenham was held to be charitable as it charitable are aimed at teaching either directly or indirectly.
was relief for the impotent.
However due to the expansion of the meaning of ‘education’,
RE VAGLIANO 1905 WN 179 a gift made to an asylum was there are difficulties in ascertaining gifts which do not have
considered to be charitable too. ‘teaching’ (directly / indirectly) as their main object.
INCORPORATED COUNCIL FOR LAW REPORTING FOR ENGLAND &
WALES v ATT-GENERAL 1972 Ch 73 Buckley LJ said the term now
applied “to the improvement of a useful branch of human
knowledge and its public dissemination.”

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B. CHA.PURPOSES: ADVANCEMENT OF B. CHA.PURPOSES: ADVANCEMENT OF

EDUCATION EDUCATION - research
Decided cases - that the word ‘education’ is not limited E.g. search for or research of original manuscripts and
to teaching ; not limited to classroom or pure academic other items of scientific or historical interest
teaching per se.
Subject of research must itself be useful and that the gift
Used in wide sense ; looking for dissemination or must make some provision for the information gained to
imparting of knowledge be disseminated and made available for study.
includes gifts to particular educational institutions, such To be cha for the advancement of education, not merely
as schools and universities, which, coming under the the acquisition of knowledge without dissemination to
preamble, are prima facie charitable public
Educational trusts can embrace specific purposes which
are related, sometimes loosely, to education

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B. CHA.PURPOSES: ADVANCEMENT OF B. CHA.PURPOSES: ADVANCEMENT OF

EDUCATION - research EDUCATION - research
RE HOPKINS WILL TRUST 1964 3 AER 46 a gift of money was Wilberforce J also laid down the broad requirements of a
given to Francis Bacon Society to search for Bacon-Shakespeare research which could be considered as charitable:- “The
manuscripts. The object was to discover documentary proof word education must be used in a wide sense, certainly
that Shakespeare’s plays were written by Francis Bacon and to
extending beyond teaching, and the requirement is that,
discover the original manuscript of these plays.
in order to be charitable, research must either be of
Held: Cha as the results of the research would be published to educational value to the researcher or must be so
the world which was directed to improve the literary heritage. directed as to lead to something which will pass into
the store of educational material, or so as to improve
the sum of communicable knowledge in an area which
education may cover education in this last context
extending to the formation of literary taste and
appreciation….”

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B. CHA.PURPOSES: ADVANCEMENT OF B. CHA.PURPOSES: ADVANCEMENT OF

EDUCATION - research EDUCATION - research
MCGOVERN v A.G. 1981 3 AER 493, Slade J clarified RE SHAW 1957 1 AER – restricted approach to research.
research to be cha as follows: Gift of money by George Bernard Shaw, for the
development of a forty letter alphabet and the translation
1) Only if:- (a)the subject matter of the proposed
research is a useful object of study; and (b) it is of one his plays ‘Androcles and the Lion’ into this new
contemplated that the knowledge acquired as a result of alphabet. Held : not charitable on the ground that if the
object be merely the increase of knowledge, per se, that
the research will be disseminated to others, and (c) the
trust is for the benefit of the public, or a sufficiently is not in itself a charitable object unless it be combined
important section of the public will teaching or education. (compare with RE HOPKINS)

2) Unless provided otherwise, the court will be readily RE BRITISH SCHOOL OF EGYPTIAN ARCHAELOGY 1954 1
WLR 546 the Court upheld the gift for the research into
inclined to construe a trust for research as importing
subsequent dissemination of the results thereof Egyptian historical artifacts as charitable

3) not necessary to have/involve a conventional teacher-

student situation or conventional education style.
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B. CHA.PURPOSES: ADVANCEMENT OF B. CHA.PURPOSES: ADVANCEMENT OF

EDUCATION – artistic education EDUCATION – artistic education
H: whether a particular body is established for charitable
Promotion of artistic pursuits which are of artistic merits
may fall under the education purposes is a question of law and it can not be a matter of
fact. As the Society was established for the promotion of
Applies to trust for specific artistic purposes and not for aesthetic education. Its objects were charitable and its
promotion of it per se as it was too wide and too vague income was exclusively applied for the purpose of charity.
ROYAL CHORAL SOCIETY v IRC 1943 2 AER 101 Lord Greene
stated: “In my opinion, a body of persons established for Lord Greene, MR stated:-“I protest against that narrow
purpose of raising the artistic state of the country is conception of education when one is dealing with aesthetic
established for charitable purpose.” education. A body of persons established for the purpose of
raising the artistic taste of the country and established by an
Facts: the Society had its object “to form and maintain a appropriate document which confines than to that purpose, is
choir in order to promote the practice and performance of
choral works” in London. The question arose whether it was established for educational purposes, because the education
established for charitable purposes. of artistic taste is one of the most important things in the
development of a civilized human being.”

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B. CHA.PURPOSES: ADVANCEMENT OF B. CHA.PURPOSES: ADVANCEMENT OF

EDUCATION – artistic education EDUCATION – artistic education
In evaluating the artistic merits of an artistic education, the court
Artistic purposes may also includes social graces may seek expert opinion on the matter – intention of donor
RE SHAW’s WILL TRUST 1952 1 AER 49 where the wife of irrelevant
George Bernard Shaw left money for what was RE DELIUS 1957 1 AER 49, the widow of the composer Frederick
described as a sort of finishing school for the Irish Delius, by will, gave her residuary estate to her trustees on trusts
people, where “self control, oratory, deportment and for the advancement of her husband’s musical works. Q: was it a
the arts of personal confidence” were to be taught. valid charitable trust. It was not in dispute that the standard of
Vaisey J concluded that the gift was charitable, stating Delius’s work was so high that the question as to his adequacy as
that education included ‘the promotion and a composer did not arise. The issue was decided subjectively by
the Court. Held : the purpose of the trust was to spread the
encouragement of those arts and graces of life which
knowledge and appreciation of Delius’s work throughout the
are, after all, the finest and best part of human world and the fact that it was also to enhance the reputation of
character.’ Delius did not prevent it being a charitable trust.

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B. CHA.PURPOSES: ADVANCEMENT OF B. CHA.PURPOSES: ADVANCEMENT OF

EDUCATION – artistic education EDUCATION – sports
RE PINION 1965 Ch. 85 a testator made a gift to Promotion of sports per se is not regarded as
national Trust of his studio and its contents, a charitable, however if it is carried out as part of the
collection of furniture, paintings china and other activities of schools and universities, it can be included
objects to trustees, to be used as a museum to display under advancement of education.
his collection of arts. Experts were of the opinion that IRC v MCMULLEN 1945 Ch. 16 per Lord Hailsham:
the collections were virtually worthless and of no
“education …when it is applied to the young … it is
artistic merit what so ever. As the display of this complex and varied …. it is a picture of a balanced and
collection could not be regarded as of any educational systematic process of training, instruction and practice
value, the Court held that the gift failed as charity.
containing both spiritual, moral, mental and physical
Harman LJ stated that he could ‘conceive of no useful elements.’
object to be served by foisting upon the public this
mass of junk.” Therefore - Sports which forms part of the normal
educational process can be said to be within this
heading, as long as it will benefit the public.
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B. CHA.PURPOSES: ADVANCEMENT OF B. CHA.PURPOSES: ADVANCEMENT OF

EDUCATION – sports EDUCATION – sports
Physical education, games and sports, other extra RE MARIETTE 1915 2 Ch 284 a gift of £1000 was given to
curricular activities such as field trips are all Aldenham School for the purpose of building squash
considered to be within the ambit of education, courts and to provide for prizes in some school athletic
provided that they are for the young, who it is assumed sports. Held: it was charitable, for the development of
are still undergoing a process of education and the body and mind of boys aged 10-19 years.
development.
RE NOTTAGE 1895 2 Ch 649 a gift to purchase a
Harmful sport activities – can be excluded from perpetual trophy for yacht racing was held not to be
education. charitable as it only promotes sports only
IRC v MCMULLEN a trust for the promotion of RE CLIFFORD 1911 where a gift was made to aid angling
association football or other games and sports in British was refused charitable status
schools and universities was upheld as charitable. The
aim of the settlor was the promote the physical
education and development; it is education in a wide
sense.
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B. CHA.PURPOSES: ADVANCEMENT OF Trusts for the Advancement

EDUCATION – sports of Education – edu + politics
RE DUPREE 1945 Ch. 16 where a sum of £5000 which
was left to established an annual chess tournament for Courts are hostile to political purposes trust and trusts
boys and young men under 21 was upheld as for the dissemination of political propaganda under the
charitable. Vaisey J upheld the gift but warned against guise of education are not charitable.
slippery slopes i.e. to consider such anomalous cases Educational charities are restrained from using their
i.e. scrabble, draughts which are towards the resources for political purposes.
improvement of mental ability of young people, in
RE HOPKINSON 1949 1 AER 346 Vaisey J warned that
view of their own peculiar facts. “political propaganda masquerading as education is not
RE WEBBER 1954 1 WLR 1500 a gift for the furtherance education for the purpose of charity. In this case gifts
of boy scout’s movement was upheld as charitable. were made to ‘for the advancement of adult education
in lines with Labour Party policies’ was considered as
gifts made to political parties thus not charitable.

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Trusts for the Advancement Trusts for the Advancement

of Education – edu + politics of Education – edu + politics
BOWMAN v SECULAR SOCIETY LTD 1917 AC 406 Lord Parker Stated the
general position as follows :- “A trust for the attainment of political Gifts were made to political parties under the guise of
objects has always been held invalid, not because it is illegal for furthering of edu – not cha.
everyone is at liberty to advocate or promote by any lawful means a RE BUSHNELL 1975 1 All ER 721 ChD , Gifts by testator
change in the law, but because the Court has no means of judging
whether a proposed change in the law will or will not be for the public
‘for the advancement and propagation of the teaching of
benefit, and therefore cannot say that a gift to secure the change is a Socialized medicine to public and personal health”, to be
charitable gift.” done by way of lectures and pamphlets. Held : that as
the testator was trying to promote his own theory of
The Society objects were the abolition of religious tests, the
socialized medicine and not mainly to educate the
disestablishment of the Church, the secularization of education and
the alteration of the law touching religion or marriage or the public, it was not charitable.
observance of the Sabbath.
H: objects were political as they were aimed at changing the law and
the court had no means of judging if these were for the public benefit.
( a case where a political object was guised as under advancement of
education and religion)
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Trusts for the Advancement Trusts for the Advancement

of Education – edu + politics of Education – edu + politics
If gifts could be carried out without the political object RE KOEPPLER’S WILL TRUST 1986 Ch 423 a gift was made
being dominant, there might be a possibility of construing by the testator to “Wilton Park” which was a centre for
it as a charitable trust discussing of matters of international relations with
political themes, which is open to academicians and the
RE SCOWCROFT 1989 2 Ch 638: “for the furtherance of
interested public, but without getting involved in the
Conservative principles and religious and mental
political scenario. H: cha.
improvement and to keep the said reading room free
from intoxicants and dancing. “ H: charitable on the Educational charities are also restrained from using their
reason cited earlier. funds for political purposes.
Note: in present day can it be cha?

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Trusts for the Advancement Trusts for the Advancement

of Education – edu + politics of Education – edu + politics
BALDRY v FENTUCK 1972 2 AER 81, a registered charity, Sussex
Research + politics – to be cha. must aim at objectivity
University Students Union was restrained from spending money
and balance in the method of conducting research
on a campaign to restore free school milk as this was regarded
projects, and in publishing the research the aim must be
as an attempt to challenge government policy, thus is regarded
to inform and educate the public rather than to influence
by the courts as political and not charitable.
political attitudes.
WEBB v O’DOHERTY 1991 The Times, 11 February an injunction
was granted by the Court to restrain a student’s union from
spending money in support of a campaign against Gulf war.
Hoffman J made a clear distinction between the discussion of
political issues which could be a legitimate educational activity
and charitable; and campaigning in the sense of seeking to
influence public opinion on political matters which cannot be
charitable.

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Trusts for Political Purposes Trusts for Political Purposes

MCGOVERN v A.G. 1981 3 AER 493 Slade J guideline:
ii. Trust for political purposes …. include (inter alia) trust of
MCGOVERN v A.G. 1981 3 AER 493 Slade J set out the which a direct or principal purpose is either:-
reasons for Courts not to allows a trust which has among
its objects, matters which are essentially political as - To further the interests of a political party, or
charitable and the guidelines as to what are considered - To procure changes in the law of the country, or
as trusts for political purposes. He stated:
- To procure changes in the law of a foreign country
i. even if the purposes falls within the spirit of Preamble
of Statute of Elizabeth 1; a trust for political purposes - To procure a reversal of government policy or of particular
falling within the spirit of Lord Parker’s pronouncement decisions of government authorities in his country, or in a foreign
in BOWMAN’s case can never be regarded as being for the country
public benefit in the manner which the law regards as
charitable. Reasons for refusing - court will not have the adequate means to
judge whether a proposed change in law is for public benefit;
court would risk prejudicing its reputation for political
impartiality, if it promoted political objects; it must still decide a
case on the principle that the law is right as it stands since to do
LLB20803 (C) MK MUSA, FUHA, UNISZA. 57 otherwise
LLB20803 (C) MK would usurp the function of the legislature.
MUSA, FUHA, UNISZA. 58

B. REQUIREMENTS OF
Trusts for Political Purposes
CHA.PURPOSE – ADV. OF RELIGION
Organizations which are set up to procure changes in the law or
has as one of their objects a charge in law and it sole aim is
changes in the law then it will be refused charitable status For the advancement of religion, must be religious in a sense
NATIONAL ANTI-VIVISECTION SOCIETY v IRC 1948 AC 31 acceptable by the court.
If however the organization only presses for changes in law as a no comprehensive definition of religion.
matter incidental to its main purposes, it may then still retain its Religion involves spiritual belief, faith and belief in a God or
charitable status.
Gods
Each case is a question of facts in itself
must also promote spiritual teaching but it does not mean it
only covers mere moral teaching, ethics or the philosophy of
the nature of man.
Ethics per se did not form religion although religion is broad
enough to cover many aspects of ethical practices.

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B. Trusts for the Trusts for the Advancement

Advancement of Religion of Religion
Meaning of religion - ‘belief’ in’ the higher unseen Def of ‘religion’ was provided by Mason CJ and Brennan
power which is Divine. J in Church of the New Faith v Commissioner of Pay-roll
Tax (Vic) (1983) 154 CLR 120 at 136; [F]or the purposes
CHURCH OF THE NEW FAITH V COM OF PAYROLL TAX
of the law, the criteria of religion are twofold: first,
(Australia) defines religion as: – 1. belief in supernatural
belief in supernatural Being, Thing or Principle; and
being, thing or principle – 2. code of conduct to give
second, the acceptance of canons of conduct in order to
effect to belief
give effect to that belief, though canons of conduct
BOWMAN v SECULAR SOCIETY, Lord Parker - which offend against ordinary laws are outside the area
monotheistic belief was an essential qualification of of immunity, privilege or right conferred on the grounds
religion. of religion

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Trusts for the Advancement Trusts for the Advancement

of Religion of Religion
RE SOUTH PLACE ETHICAL SOCIETY 1980 3 AER 918, Dillon J:
Examples of valid trusts:
“Religion as I see it, is concerned with man’s relations with
Gods, and ethics are concerned with man’s relations with man. Trusts for Buildings, Grounds and Cemeteries
The two are not the same… It seems to me that the two Trusts for Prayers, Masses and Ceremonies
essential attributes of religion are faith and worship : faith in a
Gifts to Religious Office Bearers
God and worship of that God. The Oxford English Dictionary
gives as one of the definitions of religion; (i) A particular Other religion - as long as its purposes are beneficial to
system of faith and worship, (ii) Recognition on the part of man the community and not devoid of all morality, it will be
of some higher unseen power as having control of his destiny considered charitable.
and as being entitled to obedience, reverence and worship.”
NEVILLE ESTATES v MADDEN 1962 Ch 832:
- here the society was formed for the study and dissemination of
“As between different religions, the law stands
ethical principles.
neutral, but it assumes that any religion is at least
likely to be better than none.”
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Trusts for the Advancement Trusts for the Advancement of

of Religion Religion - Cases

England - Buddhist and Hindu religions have been THORNTON v HOWE (1862), a trust for the publication of the
granted charitable status by the Charity Commissions ‘sacred writing’ of Joanne Southgate, who claimed that she
was with child by the Holy Ghost and would give birth to a
Australian High Court has accepted Scientology Church new Messiah was upheld as cha.
of New Faith as a religion capable of enjoying charitable
privileges. UNITED GRAND LODGE OF ANCIENT FREE & ACCEPTED MASONS
v HOLBORN BOROUGH COUNCIL 1957 1 WLR 1090 freemasonry
Essential - must advance some religious doctrine either was held non-charitable as it did not advance religion but
directly and indirectly. It need not be numerically instead required its members to believe in a Supreme Creator
strong / many in order to qualify for the status. What is and live a good moral life.
necessary to show is that it is a genuinely held belief or
doctrine.

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Trusts for the Advancement of Trusts for the Advancement

Religion - Cases of Religion – cases
Donovan J:- “To advance religion means to promote it, A.G v THIRPOOREE SOONDEREE 1808-1884 1 KY 377 the
to spread its message even wider among mankind; to court upheld a gift of land for the benefit of a Hindu
take some positive steps to sustain and increase temple as religious and charitable gift however a gift of
religious belief and these things are done in a variety $200 to a named idol in the temple failed to take effect
of way which is described as pastoral and missionary.” as a charitable trust.
RE WATSON 1973 3 AER 678, a trust was established to RE LOW KIM PONG’s TRUST SETTLEMENTS 1938 MLJ 119
publish book and articles by Hobbs, a leader of a very the court held that a gift of land to a Buddhist priest for
small non-denominational Group of Christian. Although the purpose of erecting a temple of worship and to
the groups was very small and on expert evidence him maintain an orchard to be used for the purposes of the
work was of no value, the members were sincere in temple, as charitable.
their belief thus charitable

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Trusts for the Advancement Trusts for the Advancement

of Religion – cases of Religion – cases
TITULAR ROMAN CATHOLIC BISHOP OF K.L. vs CHAIRMAN A.G v STEPNEY 1804, a trust for distribution of Bibles
KLANG TOWN COUNCIL the high court ruled that a and other religious books – charitable
church is clearly a place of religious worship within the
RE CLERGY SOCIETY 1856, gifts made to missionary
definition under PEMSEL’s case
societies eg the Church Missionary Society – charitable
Purposes incidental / related to the main activity of
A.G v CHESTER (1785) – to establish a bishopric
advancement of religion will also be charitable for e.g.
for the upkeep and maintenance of religious officers / A.G v SPARKS (1753) – to provide for a clergyman’s
priests not beneficially or to him personally, but as to salary
the holder of the office / position – such gifts are A.G v PARKER (1747) – to provide a pension for a
considered to be charitable and he is expected to apply clergyman
the money for the advancement of religion.

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Trusts for the Advancement Trusts for the Advancement

of Religion – cases of Religion – cases
To maintain places of worships which were upheld- Gifts to religious officials is subjected to whether the
gift is given to the person itself or to the office he is
RE PARKER (1859) – to provide and maintain place of
holding. If it is to his office – it is charitable as he is
worships
required to use the gift for advancement of religion.
RE MANSER (1905) – to provide furniture and ornaments
RE GARRARD 1907 1 Ch 382 - a gift to the Vicar and
in places of worships.
church wardens ‘for such purposes as they in their sole
HOARE V OSBORNE (1866) – to maintain any part of the discretion think fit’ was valid as they would only think
fabric of the Church. of religious purposes.
TURNEX v OGDEN (1787) – provide for Church bells. RE BAIN 1930 1 Ch 224 – TO THE Vicar ‘for purposes
connected’ with the Church – charitable.
A.G v OAKAVER (1736) – to provide an organ and salary
for the organist. RE SIMSON 1946 Ch 299 – “to Vicar of St. Luke’s Church
for his work in the Parish” – charitable as it means it is
RE VAUGHAN (1886) – for the churchyard or burial to be used for religious work in that particular parish.
ground.
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Trusts for the Advancement Trusts for Purposes which are Beneficial
of Religion – cases to the Community
Under this grouping - acceptable cha purposes are a great
RE EASTES 1948 1 AER 536 Ch. – ‘to the Vicar and Churchwarders of variety of general purposes which are more or less,
St. George’s Church, for any purposes in connection with the said conducive to the public good, within the spirit and
Church which they may select’ – charitable as the discretion given did
intendment of the Preamble
not allow them to use the gift for non-charitable purposes.
Need to refer to changes in social condition
FARLEY v WESTMINSTER BANK 1939 AC 430 – a gift was made to the
Vicar for ‘Parish work’ – non-charitable because it was not for In short – need to satisfy 2 pre-requisite to be valid cha
religious purposes alone but for the assistance and furtherance of trust:- per Russell LJ in INCORPORATED COUNCIL FOR LAW
those activity which include many objects which are legally non- REPORTING v AG 1972 Ch 73
charitable.
1. the purpose in question must be beneficial to the
RE STRATTON 1931 1 Ch 197 – ‘to Vicar of Mortlake to be distributed community
at his discretion among such parochial institutions / purposes as he
shall select – not-charitable as parochial institutions were not 2. purpose must fall within sprit of Preamble
necessarily religious institution.

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Trusts for Purposes which are Beneficial Trusts for Purposes which are
to the Community Beneficial to the Community
Note: NOT every purpose which is clearly beneficial to the
public will be beneficial in a way which the law considers Examples of purposes upheld as cha by courts:
to be charitable.
Gifts to a Community/Locality
Compare between INCORPORATED COUNCIL OF LAW
REPORTING FOR QUEENSLAND (production of law reports) Public Works and Beautification Trusts
and CHESTER V RNA - breeding of racing pigeons Protection of Animals and Wildlife
AG v NATIONAL PROVINCIAL BANK 1924 AC 2 62 Viscount Protection from War and Disaster
Cave said:
Relief of Taxes
“Lord McNagthen (in PEMSEL) did not mean that all trusts
Public Recreation and Sport
for purposes beneficial to the community are charitable, but
that there were certain charitable trust which fall within Public Safety and Defence
that category.”
Note: this grouping are not meant to be exhaustive or
definitive but as a guide
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Trusts for Purposes which are Beneficial Trusts for Purposes which are Beneficial
to the Community - Animals to the Community - Animals

Trust for animals generally -can be cha Must either relief suffering to animals or it must be one which
will not restrict the public to view / benefit from these animals.
The charitable benefit is - indirect moral benefit to mankind as
cruelty to animal was degrading to man If to protect animals in isolation from human would lack the
necessary benefit to the public i.e. will not help to elevate
RE WEDGEWOOD 1915 1 Ch 113 per Swinfen-Eady J in upholding
mankind morally and not cha
a secret trust for animal protection regarded such trust – “tend
to promote and encourage kindness towards animals …. and RE GROVE-GRADY 1929 1 Ch 557 - gift was made to a society to
stimulate humane and generous sentiments in man towards the provide a sanctuary ‘for the preservation of all animals, bird or
lower animals, and by this means to promote feelings of other creatures …. so that they shall be safe from molestation
humanity and thus elevate the human race.” and destruction by man’. Held – not cha as does not benefit
mankind; as men were not allowed to even observe them.

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Trusts for Purposes which are Beneficial Trusts for Purposes which are Beneficial
to the Community - Animals to the Community - Animals

Organizations involved in wildlife preservation and nature Cases:

reserves or sanctuaries for near extinct animal, flora or fauna
can be cha; if set up with environmental element to benefit a home for lost dogs – RE DOUGLES 1887 35 ChD 472
public even at limited level. for the welfare of cats – RE MOSS 1949 1 AER 495
Gifts made to animal homes and hospital & organizations
for humane slaughtering of animals – TATHAM v DRUMMOND
preventing cruel treatment to animals – cha
If the trust for animal would conflict with human interest, the for protection of animals from ill-usages, cruelty and suffering –
court would decide in favor of human interest and hold such RE MURAWSKI’s WILL TRUST 1971.
gifts as non-charitable.
NATIONAL ANTI-VIVISECTION SOCIETY v IRC 1948 AC 31, a trust to
abolish vivisection was not charitable since this would not
benefit the public (reduce research).

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Trusts for Purposes which are Beneficial to Trusts for Purposes which are Beneficial to
the Community – recreational & social the Community – recreational & social
charities charities
Trusts for sports, per se – a recreational activity not cha unless RE GRAY 1925 Ch 362 a trust for the promotion of sport in the
as part of education. army was held as charitable because it was said to promote the
See RE NOTTAGE and IRC v MCMULLEN efficiency of public services
Purely recreational pastimes has been refused cha status In WILLIAMs TRUSTEES v IRC 1947 1 A11ER 513 and IRC v
BADDELEY 1955 AC 572, it seemed that if the social or
IRC v GLASGOW POLICE ATHLETIC ASSOCIATION 1953 1 A11ER
747, the Association was formed to provide and arrange sporting recreational aspect of a gift is too great it might be refused
activities for members of police force. Objective: ‘to encourage charitable status
and promote all forms of athletic sports and general pastimes’. introduction of words such as ‘social and/or recreational’ in a
Held: although it existed to improve the police force’s
gift / trust appear to make the ambit of the gift too wide and
efficiency, the inclusion of a merely recreational element was
fatal to its charitable status. Furthermore it is for the private possibly covering non-charitable purposes – not cha.
advantage of its members,

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Trusts for Purposes which are Beneficial to Trusts for Purposes which are Beneficial to
the Community – recreational & social the Community – recreational & social
charities charities
Recreational Charities Act 1958 (UK) – identify certain types of gifts IRC v BADDELEY – there was a trust of certain premises to be
for the purposes of recreation as cha if guideline contained in Sec 1 used for ‘the promotion of the religious, social and physical
of the said Act.
well-being of persons resident in West Ham and Leyton as were
1st foremost the facilities must aim to improve the conditions of or were likely to become members of the Methodist Church and
life of the beneficiaries and were of insufficient means to enjoy such advantages’. Held : the
2nd the beneficiaries must either need the facilities because of purposes were too vague and wide enough to cover non-
their youth, age, infirmity or disablement, poverty / social / charitable objects and also non-charitable as it lack the public
economic circumstances or must be available to the public at large. benefit element.
Thus, leisure activities which were harmful though intended to
improve the life condition of the beneficiary is excluded. So also, WILLIAMS TRUSTEE v IRC – is a trust to benefit the Welsh people
facilities run for profit with the object of making money or private in London, including a provision of a place of meeting for
sports clubs. ‘promotion of social, moral, spiritual and educational welfare of
Note: no similar Legislation in Malaysia. the Welsh people. Held: the word ‘social’ did not connote a
charitable trust and since charitable objects are mixed with
social aspects – it failed for not being exclusively charitable.
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Trusts for Purposes which are Beneficial Trusts for Purposes which are Beneficial
to the Community - Aged and Health to the Community - Aged and Health
Purposes Purposes
Preamble to 1601 Act refers to ‘aged, impotent and poor JOSEPH ROWNTREE MEMORIAL TRUST HOUSING
people’ – disjunctively. If exclude poor from paying – can be
ASSOCIATION v AG 1983 1 AER 288, a housing association
cha
was created the purpose of which to build houses the
gift for health and medicine are prima facie cha as long as the benefit of old people, over the retirement age, who is in
public benefit element can be satisfied. need of dwelling. They were given tenancy of the houses
RE RESCH’s WILL TRUST 1969 1 AC 514 where a private hospital until they paid 70% of the price of the houses. The housing
charging fees to its patients were held to be charitable, not for association was held to be charitable as it relief the ‘need’
private profit of the hospital itself but for the running of the of old people and no major profit was made by it.
hospitals.
includes ancillary purposes such as providing nurses
accommodation or facilities for relatives of the critically ill.
promotes health and gifts to hospitals which are not profit-
motivated - cha

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Trusts for Purposes which are Beneficial Trusts for Purposes which are
to the Community - benefit of localities Beneficial to the Community
trust created for a particular area, town, village, is treated as
being for charitable purposes within that area
As long as it can be said to fulfil the requirements of
Not applicable if the testator identifies specifies purposes & public benefit + within spirit & intendment of preamble
the purposes is a mixture of charitable + non-charitable – can be considered as cha.
purposes = non cha.
Cha - if group / class to benefit is from some defined group
Need to cater to public who are in need
within the locality.
RE SMITH 1932 1 Ch 153 where the gift was ‘to my country,
England’. Held: charitable and used for charitable purposes in
England.
HOUSTON v BURNS 1918 337 money was left for public,
beneficial or charitable purposes are not actually charitable –
mixture of cha + non cha purposes.

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References

Mohsin Hingun & Wan Azlan – Equity & Trusts in Malaysia

2nd Ed, 2013.
Mary George – The Law of Trust in Malaysia
Pettit - Equity & Law of Trust
Any text book on Law of trust (UK & Australia)

LLB20803 (C) MK MUSA, FUHA, UNISZA. 89