Commissioners of Inland Revenue v Baddeley
| Jurisdiction | England & Wales |
| Judge | THE MASTER OF THE ROLLS,LORD JUSTICE JENKINS |
| Judgment Date | 18 May 1953 |
| Judgment citation (vLex) | [1953] EWCA Civ J0518-2 |
| Date | 18 May 1953 |
| Court | Court of Appeal |
[1953] EWCA Civ J0518-2
The Master of the Rolls (Sir Raymond Evershed)
Lord Justice Jenkins and
Lord Justice Hodson
In The Supreme Court of Judicature
Court of Appeal
Mr S. PASCOE HAYWARD, Q.C. and Mr W.F. WAITE (instructed by Messrs Kenneth Brown, Baker, Baker) appeared on behalf of the Appellants.
Mr GEOFFREY CROSS, Q.C. and Mr J.H. STAMP (instructed by Solicitor of Inland Revenue) appeared on behalf of the Respondents.
THE ATTORNEY-GENERAL (Sir Lionel Heald, Q.C.) with The Hon. DENYS B. BUCKLEY (instructed by the Treasury Solicitor) appeared ac amicus curiae.
I have had the pleasure and advantage of reading the Judgment about to be delivered by Lord Justice Jenkins, who, after a close analysis of the language of the two relevant conveyances of the 21st August, 1951 (which in this as in every case it is first of all necessary to construe) and after reference to the numerous authorities to which our attention was directed, has reached the conclusion that the two deeds ought to be regarded as "made to a body of persons established for charitable purposes only or to trustees of a trust so established" within the meaning of Section 54(1) of the Finance Act 1947. I find myself in entire agreement with my brother and with the reasons for his Judgment; and, were it not for the importance of the arguments to which the case has given rise and to the fact that we are differing from Mr Justice Harman in the Court below, I should have been content to do no more than express my concurrence with Lord Justice Jenkins. In the circumstances, however, I hope that it may be useful for me, without repeating my brother's reasoning, to add some few considerations of my own.
Upon the question of construction of the deeds, I agree with Lord Justice Jenkins that the overriding purpose of the trusts therein respectively contained are the promotion of the religious, social and physical well-being (in the one case) and of the moral, social and physical well-being (in the other) of the class of persons therein identified, and that the other relevant provisions of the two deeds serve only to indicate the means ancillary to those objects. In this respect, therefore, the present case is, in my judgment, essentially distinct from Trustees of Londonderry Presbyterian Church House v. Inland Revenue Commissioners, 1927 Tax Cases, page 431. In the deed which was in that case under consideration, the main object of thedisposition was that it should be used "as a hall for meetings or for social or recreation purposes in connection with the various Presbyterian Churches in … Londonderry … or as a hostel or boarding-house or as a library or for such other … purposes as the Board of Governors … shall … think fit, it being the true intention … that the said premises shall be used for … assisting and helping in the religious, moral, social and recreative life of those connected with the Presbyterian Church in … Londonderry … in such manner as the said Board of Governors … shall … think right". The language I have quoted (and in doing so I have emphasised the repeated use of the disjunctive "or") contemplates upon the face of it the use of the property conveyed exclusively for "social purposes", "recreation purposes", or (for example) for a boarding house, objects which, according to the authorities, would be outside the scope of exclusively charitable trusts unless the final words in the quotation could be so construed as to confine and, as it were, rescue what had gone before. The Irish Court of Appeal held that the final words could not have that effect. In the present case, Lord Justice Jenkins' analysis of very different language shows that no such rescue operation is here demanded; that the vital general words appear, not by way of an expository limitation, but as the opening and primary expression of the objects of the trusts. Although the Londonderry case is not binding upon this Court, I agree with Mr Justice Harman that it must be treated with the greatest respect, and not the least so because, the law in regard to charities being the same in Northern Ireland as in England, it is plainly desirable that the decisions of the Courts in the two countries should be in conformity. It is, however, unnecessary for me to say more about the Londonderry case since, for the reasons I have indicated, it cannot in myjudgment, be said to cover the present case, or provide the clue for its decision.
The most important and the most difficult question raised in the present appeal is whether, assuming that the class of persons to be benefited can properly be said to be a section of the public, the second essential requirement for satisfying the test of a trust claiming to be charitable is satisfied, namely, whether the purposes of the deed fall within the spirit and intendment of the preamble to the Statute of Elizabeth ( 43 Elizabeth I, Chapter 4). I take as my guide the language of Lord Simonds in Williams Trustees v. Inland Revenue Commissioners, 1947 Appeal Cases, at page 455: "My Lord, there are, I think, two propositions which must ever be borne in mind in any case in which the question is whether a trust is charitable. The first is that it is still the general law that a trust is not charitable and entitled to the privileges which charity confers, unless it is within the spirit and intendment of the preamble to the statute of Elizabeth ( 43 Eliz. c. 4), which is expressly preserved by section 13, subsection 3, of the Mortmain and Charitable Uses Act, 1888. The second is that the classification of charity in its legal sense into four principal divisions by Lord Macnaghten in Income Tax Commissioners v. Pemsel must always be read subject to the qualification appearing in the judgment of Lord Justice Lindley in In re Macduff: 'Now Sir Samuel Romilly did not mean, and I am certain Lord Macnaghten did not mean, to say that every object of public general utility must necessarily be a charity. Some may be, and some may not be'. This observation has been expanded by Lord Cave, Lord Chancellor, in this House in these words: 'Lord Macnaghten did not mean that all trusts for purposes beneficial to the community are charitable, but that there were certain beneficial trusts which fell within that category; andaccordingly to argue that because a trust is for a purpose beneficial to the community it is therefore a charitable trust is to turn round his sentence and to give it a different meaning. So here it is not enough to say that the trust in question is for public purposes beneficial to the community or for the public welfare; you must also show it to be a charitable trust. See Attorney-General v. National Provincial & Union Bank of England'".
I agree with Lord Justice Jenkins that the trusts in the present case cannot be regarded as being for the advancement of religion, though, at any rate in one instance, they have a religious element in them. I agree also with my brother that they cannot be regarded as for relief of poverty, though the "means test" which they comprehend endows them with a certain flavour of poor relief; and I accept the argument that to show that the trusts are trusts for the advancement of religion or for the relief of poverty or both, but comprehend also other objects, will not (at least if the latter are not merely incidental in character) qualify the whole for the enjoyment of the privileges of a charity unless those other objects are also themselves charitable.
In the course of his Judgment, Mr Justice Harman was impressed by the emphasis which he discerned upon recreation as an essential purpose of the trusts, and he indicated his view (though I do not think it was essential to his conclusion) that trusts for promoting or providing recreation are not charitable. Thus, at the foot of page 8 of the transcript of his Judgment, he said: "If I were free to do so, I should hold that recreation is not a charitable object"; and he thus concluded his Judgment: "Accordingly, if I had held that recreation was a charitable object, I should have held that the purpose here was public recreation".
These expressions of opinion by the learned Judge have served to afford to us at the hearing in this Court the benefit of the argument of the Attorney-General, who appeared before us as amicus curiae, being anxious lest the learned Judge's expressions might be regarded as casting dcubt upon the qualification as charitable trusts of many activities like those, for example, of the National Playing Fields Association. With all respect to him, I think that Mr Justice Harman's opinion on trusts for recreation was too broadly stated. It is not now in doubt that trusts which may be described as being for "the encouragement of mere sport" (which may be the same thing as "the mere encouragement of sport") would not be charitable; ( re Nottage, 1895 2 Chancery, page 649). On the other hand, apart from the inference which must be drawn from the many Statutes to which we were referred by the Attorney-General, beginning with the Recreation Grounds Act 1859, it is in my judgment clear that trusts for the provision or promotion of recreation, even though comprehending organised games, may well qualify as charitable trusts if, for example, they can in their context be regarded as educative in their main purpose; and in the most recent case of Inland Revenue Commissioners v. City of Glasgow Police Athletic Association, 1953 2 Weekly Law Reports, page 625, it was clearly indicated by Lord Normand that the activities there under review, which were in the event held to amount in effect to those of a recreational club, would have qualified for the privileges of a charity had they been but incidental to the purpose of improving the efficiency of the police force and of the encouragement...
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