Trusts for Religious Purposes and the Question of Public Benefit
| Date | 01 March 2008 |
| Published date | 01 March 2008 |
| DOI | http://doi.org/10.1111/j.1468-2230.2008.00687.x |
THE
MODERN LAW REVIEW
Volume 71 March 2008 No 2
Trusts for Religious Purposes and the Question of
Public Bene¢t
Matthew Harding
n
It is a well-established pri nciple that no trust may be regarded as charitable in law unle ss carrying
out its purposes wil l be ne¢t the public.Trusts for religious purposes have traditionally been pre-
sumed bycourts to be for the public bene¢t. However, the presumptionof public bene¢t wil l be
removedfrom the law in early 2008 when section 3(2) of the Charities Act20 06 comes into force.
At that time, two questions are likely to attract interest.First, to what extent, and in what ways,
has the application ofa presumption of public bene¢t assisted courts up to now? Secondly, with-
out the assistance of the presumption, howmight courts go about ascertaining whether the pub-
lic will bene¢t i n future cases? The article takes up these two questions with respect to trusts for
religious purposes.
INTRODUCTION
It is a well-established principle that no trust may be regarded as charitable in law
unless carrying out its purposes will bene¢t thepublic.The ‘public bene¢ttest’, as
it has come tobe known, has, over the years, given rise to a considerable body of
case law.One group of cases hasraised questions aboutthe extent to which, and in
what sense, the purposes of a charitable trust must be public in character.
1
Another
groupof cases has raised questions about whether thepurposes of a trust, ifcarried
out, will bene¢t the public.Within this second group of cases, a distinction has
been drawn among trusts falling under the four traditional ‘heads’ of charity
famously set out by Lord Macnaghten i n Commissioners for Special Purposesof Income
Ta x vPemsel.
2
In the case of trusts falling under the ¢rst three traditional heads of
charity ^ trusts whose purposes are recognised in law as the relief of poverty, the
advancement of education, or the advancement of religion ^ courts have pre-
sumed public bene¢t unless the contrary has been proven based on evidence.
However, in the case of trusts falling under the fourthtraditional head of charity ^
trusts for purposes bene¢cial to thecommunity not falling under one of the¢rst
three traditional heads of charity ^ courts have applied no suchpresumption.
3
n
Lecturer,Law School, Universityof Melbourne. Mytha nks tothe two anonymous referees for their
invaluablecomments and suggestions.
1 See eg, Oppenheim vTobacco SecuritiesTrust Co Ltd [1951] AC 297; Inland Revenue Commissioners v
Baddeley[1955] AC 572; Dingle vTu r n e r [1972] AC 60 1.
2 [1891] AC 531,583.
3NationalAnti-VivisectionSociety vInland Revenue Commissioners [1948 ] AC 31 (‘Vivisectioncase’).
r2008 The Author.Journal Compilation r2008 The Modern Law Review Limited.
Published by BlackwellPublishing, 9600 Garsington Road,Oxford OX4 2DQ,UK and 350 Main Street, Malden, MA 02148, USA
(2008) 71 (2) 159^ 182
Against this backdrop, the enactment of the Charities Act 2006 is an event of
great signi¢cance for the law relating to charitable trusts. Among its other innova-
tions, the act ¢nally severs the longstanding connection between the de¢nition of
charitable purpose and the preamble to the Statute of Charitable Uses 1601.
4
More-
over, even though the Cha rities Act explicitly preserves the public be ne¢t test and
the general law understanding of the meaning of public bene¢t,
5
the legislation
removes the presumption of public bene¢t that has been applied in the past in cases
on trusts falling under the ¢rst three traditional heads of charity.
6
When the provi-
sions of the Charities Act relating to public bene¢t come into force in early 2008,
7
whether a purpose that is otherwise charitable is for the public bene¢t will have to
be determined, based on the evidence before the court, without the application of
any presumption.
8
As a consequence,from that time there is likely to be interest in
questions relating to public bene¢t on the partof litigants and judges. In particular,
interest is likely to centre on twoquestions. First, towhat extent, andin what ways,
has the application of a presumption of publ ic bene¢t assi sted courts up to now?
Secondly, without the assistance of the presumption, how might courts go about
ascertaining whether the public will bene¢t in future cases?
In this article, I take up these two questions with respect to trusts falling under
one of the traditional heads of charity: trusts for the advancementof religion. In the
future, questions of public bene¢t are likely to be of particular interest when it
comesto trusts underthis head of charity, because in additionto removing the pre-
sumption of public bene¢t, the Charities Act widens the meaning of religion for
the purposes of the law relating to charitable trusts and thereby makes it less likely
that cases on trusts for religious purposes will be determined on the basis that the
purposes in question do not advance religion.
9
The article proceeds in three stages.
First, I consider the extent to which, and the ways in which, the presumption of
public bene¢t has, up to now, assisted courts in cases on trusts for religious purposes.
Secondly, I identify two approaches from within the case law ^ on trusts for reli-
gious purposes and on trusts falling under the other traditional heads of charity ^
whichmightbeavailabletocourtsoncethepresumptionofpublicbene¢tis
4 Charities Act 2006, s 2.
5 Charities Act 2006, s 3(3).
6 Charities Act 2006, s 3(2).
7 Cabinet O⁄ce (O⁄ce of the Third Sector), CharitiesAct 2006: Implementation Plan (5 December
2006) at www.cabineto⁄ce.gov.uk/third_sector/documents/charity_reform/implementation_plan.
pdf (visited 18 October 2007).
8 The Charity Commission is required, under section 4 of the Charities Act, to issue guidance
explaining the public bene¢t requirement.The Commission has initiated a consultation process
with a view to issuing this guidance in June 2008. See Charity Commission, Cons ultation on Draft
PublicBene¢tGuidance (March 2007)at www.charity-commission.gov.uk/library/enhancingcharities/
pdfs/pbconsult.pdf (visited 18October 2007).However,although the Commission’sguidance will
assist in knowing how the Commissionwi ll addressthe question of public bene¢t when it con-
siders applications for registration, it will not address how a court wil l determine whether a pur-
pose stated by a putative settlor or a testatori s for the public bene¢t.That wil l be a matter for the
court, applying the relevantcase law.
9 Charities Act 2006, s 2(3)(a):‘‘‘religion’’includes ^ (i) a religionwhich i nvolves belief in more than
one god,a nd (ii) a religionwhich does not involve belief in a god’. Cf Re SouthPlace EthicalSociety
[1980] 1WLR 1565;C harity Commissioners, Applicationfor Registration as a Charityby the Church of
Scientology (England andWales)(17 November1999) (‘CoS’) at www.charity-commission.gov.uk/
Library/registration/pdfs/cosfulldoc.pdf (visited 18 October 2007).
Trusts forReligious Purposes
160 r20 08 The Author.Journal Compilation r2008 The Modern Law Review Limited.
(2008) 71(2) 159^182
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