Baptist Churches of South Australia Inc v Attorney-General (SA)
[2018] SASC 14
•1 March 2018
SUPREME COURT OF SOUTH AUSTRALIA
(Civil)
BAPTIST CHURCHES OF SOUTH AUSTRALIA INC & ANOR v ATTORNEY-GENERAL FOR THE STATE OF SOUTH AUSTRALIA
[2018] SASC 14
Reasons for Decision of The Honourable Justice Stanley
1 March 2018
CHARITIES - CHARITABLE GIFTS AND TRUSTS - WHEN APPLIED CY-PRES - IMPRACTICABILITY OF OBJECT - WHERE GIFT APPLIED CY-PRES
Application for a trust variation scheme pursuant to sections 69B and 59B of the Trustee Act 1936 (SA). The application was heard on 19 October 2017 at which time orders were made granting the application. These are reasons for so doing.
Clause six of the deceased’s will bequeathed certain shares to his trustees and for the trustees to pay income and dividends therefrom equally to two individuals for their joint lives and solely to the survivor of them for her life and upon the death of such survivor upon trust for the plaintiff for the purpose of making additions to an existing hospital controlled by it and in the event of there being no such hospital then for the purpose of providing a fund for the erection of a hospital to be controlled by the plaintiff.
At issue is whether the trust purpose is financially impracticable. At the date the will was executed by the deceased and at the date the funds were received by the plaintiff (presently held on trust) it did not own or conduct a hospital to which the trust funds could be applied. The plaintiff also submits the funds held on trust are insufficient to erect and conduct a hospital. The proposed scheme would (inter alia) vary the purpose of the trust to provide for the erection, maintenance and operation of a primary health care facility. The defendant does not oppose the proposed scheme.
Held: Application granted.
1. Clause six of the deceased’s will seeks to establish a charitable trust.
2. The evidence establishes that the available trust funds would not be sufficient to establish a functioning modern hospital. The original purposes of the trust established by the deceased’s will cannot be satisfactorily fulfilled. A variation is justified.
3. However, the trust funds would be sufficient to build a clinic or community health centre. A primary health care centre could be established consistently with the spirit and intention of the deceased.
Trustee Act 1936 (SA) s 59B, s 69B, referred to.
Public Trustee v Attorney General (NSW) & Ors [2005] NSWSC 1267; Re Trusts of Kean Memorial Trust Fund (2003) 86 SASR 449; Re JW Laing Trust [1984] Ch 143; Oldham Borough Council v Attorney-General [1993] Ch 210; Chinachem Charitable Foundation Ltd v Secretary for Justice & Ors [2015] HKCFA 35; Re Royal Society’s Charitable Trusts [1956] Ch 87; Construction Industry Training Board v Attorney-General [1973] Ch 173; Re Baker (1985) 11 DLR (4th) 430; Corish v Attorney-General’s Department (NSW) [2006] NSWSC 1219; Re Robinson [1931] 2 Ch 122; Re The Lutheran Laypeople’s League of Australia Inc [2016] SASC 106; Re Dion Investments Pty Ltd (2014) 87 NSWLR 753; The Joyce Henderson Trustee (Inc) v Attorney-General (WA) [2010] WASC 60, applied.
Re Royal Society’s Charitable Trusts [1956] Ch 87; Re Shipwrecked Fisherman and Mariners Benevolent Society [1959] Ch 220; Re Coates’ Trusts [1959] 1 WLR 375; Re University of London Charitable Trusts [1964] Ch 282; Trustees of the British Museum v Attorney-General [1984] 1 WLR 418, discussed.
BAPTIST CHURCHES OF SOUTH AUSTRALIA INC & ANOR v ATTORNEY-GENERAL FOR THE STATE OF SOUTH AUSTRALIA
[2018] SASC 14STANLEY J.
Introduction
This is an application for a trust variation scheme pursuant to s 69B and s 59B of the Trustee Act 1936 (SA) (Trustee Act). The application is made by Baptist Churches of South Australia Inc (Baptist Churches) and Baptist Care (SA) Inc (Baptist Care). I heard this matter on 19 October 2017. I made an order on that occasion granting the application. These are my reasons for doing so.
The basis of the application
Frederic Thomas Trevett Fricker late of 1202 Old Port Road Royal Park South Australia died on 13 May 1973 (“the deceased”). The deceased left a will dated 9 June 1965 and a first codicil to his last will dated 28 February 1973.
Probate of the last will and codicil was granted to Elders Trustee and Executor Company Limited and Kenneth Bennet Mason by this Court in its Testamentary Causes Jurisdiction on 2 November 1973.
Clause 6 of the deceased’s will provides:
I GIVE and bequeath all my shares in F. FRICKER PTY LIMITED unto my trustees UPON TRUST to pay the income and dividends therefrom to the said JOY CLARRICE MILLER and the said ALISON HELENA KEMPSON equally for their joint lives and solely to the survivor of them for her life and upon the death of such survivor UPON TRUST for THE SOUTH AUSTRALIAN BAPTIST UNION INCORPORATED of 61 Flinders Street Adelaide South Australia for the purpose of making additions to an existing hospital controlled by that Union and in the event of there being no such hospital then for the purpose of providing a fund for the erection of a hospital to be controlled by The South Australian Baptist Union Incorporated.
On 15 June 2010, The South Australian Baptist Union Incorporated changed its name to Baptist Churches. The second plaintiff to these proceedings is Baptist Care which is an incorporated body that is wholly controlled by Baptist Churches and provides a vast range of services for persons in need. In effect, it is the social welfare arm of Baptist Churches.
The survivor of the life interests died on 19 April 2008. Between November 2010 and January 2012, the executors of the deceased’s estate proceeded to make payments and thereafter transferred the deceased’s shares in F. Fricker Pty Ltd to Baptist Churches in accordance with the terms of the deceased’s will. Baptist Churches invested the funds and as at March 2017 the fund held $5,938,796.43 in trust for the purposes prescribed in the deceased’s will.
The issue before the Court is whether the trust purpose is financially impracticable. At the date the will was executed by the deceased and at the date the funds were received by Baptist Churches, they did not own or conduct a hospital to which the trust funds could be applied. Furthermore, Baptist Churches submit that the funds held on trust are insufficient for Baptist Churches to erect and conduct a hospital.
Baptist Churches and Baptist Care have brought this application seeking a trust variation scheme to the terms of the trust established in clause 6 of the deceased’s will. The proposed scheme would vary the purpose of the trust to provide for the erection, maintenance and operation of a primary health care facility. It is further proposed that the trustee administering the trust fund should be Baptist Care rather than Baptist Churches and that various powers should be conferred upon the trustee, in accordance with the scheme.
In his affidavit sworn 22 March 2017, Mr Paul Keith Scully, the Chief Executive Officer of Baptist Care, deposes that in or about 2011, Baptist Care was asked by Baptist Churches to consider the options available for Baptist Care to erect or provide a hospital pursuant to the terms of the will of the deceased.
Baptist Care made extensive efforts to examine the viability of establishing a hospital. It consulted with health practitioners, the Government and community stakeholders. Mr Scully’s affidavit deposes that:
11. Health provision has changed over the last fifty years in Australia.
…
13. As a result, the range of services provided by hospitals has narrowed.
14.Many services once provided in hospitals are now provided in the community. These include shared care maternity services, post-natal care, district nursing, hospital in the home, renal dialysis, specific optometry services, wound management, diabetic care, orthodontic treatment, community mental health care and support and a range of allied health services such as physiotherapy screening services, minor skin surgery, medication reviews, rehabilitation, alcohol and drug support and counselling, outreach services and pathology. Ongoing post-surgery follow up support is frequently managed by predominant primary health services and even if funded by a hospital, in reality they are often provided by partnering with community providers.
15This trend has continued over the last decade, with increasing number of out-patient clinics run in the community and a gradual increase in funding for community managed mental health services.
16.While [there] are several reasons for this shift, two are especially important. The first is the cost. Services provided in hospitals are greatly more expensive than those run at a community level. The second reason is that the standards expected by the community and more formally by the National Safety and Quality Health Service Standards have risen sharply over this period. These standards have driven most hospitals to focus on what they are very good at, and to withdraw from services they cannot provide at the required levels of quality and safety.
….
18.Hospitals therefore now provide a narrower range of services which are more complex and expensive. Operating a hospital is highly sophisticated and costly in the 21st century.
19.The shift to community based health provision is likely to accelerate in coming decades as cost pressures increase, new technologies emerge that allow easier care in a local clinic and the demand for care for chronic diseases and mental illness will increase. Chronic diseases and mental illness both need much more ongoing care in the community than hospital interventions.
20.Australia is therefore building a stronger primary health care system to enable early prevention and intervention, rather than continuing to build the hospital sector. The recent National Mental Health Review (December 2014) specifically recommended that Australia’s health system be refocused towards more community care, and away from acute care.
As a result of Baptist Care’s investigations and consultations, Baptist Care concluded that although the available funds of $5,938,796.43 would not be sufficient to establish a functioning modern hospital, it would be sufficient to “build a clinic or community health centre”. Mr Scully’s affidavit explains:
32.Baptist Care’s research and consultation has led us to conclude that:
32.1 It is not viable, in the current environment with the funds available, to build a small hospital. Funding available from the Fricker Bequest is only sufficient to build a clinic or community health centre.
32.2 The most viable option will be to develop a community wellness facility, without the constraints of the “hospital” label, delivering a mixture of specialist community health care services.
32.3 A primary health care service model aligns strongly with contemporary health best practice, and would also satisfy the intent of the will.
32.4 A primary health care approach to service provision aligns strongly with the values, strategic direction and current expertise of Baptist Care.
The evidence of Mr Scully was not challenged and I accept it. I also accept the evidence of Michael William Mills, the State Executive Minister and Chief Executive Officer of Baptist Churches, who deposes that Baptist Churches is not a suitable organisation to act as the trustee of the trust established by the deceased’s will. I also accept his evidence that, for the reasons set out in Mr Scully’s affidavit, Baptist Care is a suitable organisation to do so.
He agreed with the conclusion reached by Mr Scully that it is financially impracticable for Baptist Churches or Baptist Care to establish a new hospital. Equally, he agrees a primary health care centre could be established consistently with the spirit and intention of the deceased.
Application pursuant to s 69B of the Trustee Act
The application made pursuant to s 69B of the Trustee Act seeks to vary the terms of the charitable trust established in the deceased’s will. The proposed trust variation scheme is set out in a schedule to these reasons. The Attorney‑General did not oppose the proposed trust variation scheme.
I am satisfied that clause 6 of the deceased’s will seeks to establish a charitable trust. In Public Trustee v Attorney General (NSW) & Ors, Gzell J said:[1]
[1] [2005] NSWSC 1267 at [20].
The object of providing hospital care and treatment is a recognised head of charity, both by reference to the preamble to the Statue of Charitable Uses 1601 (UK) as a gift for the care of the impotent and for persons decayed and on the basis of a long line of authority upholding gifts for hospital purposes, or for the work of named hospitals, as charitable (In re Resch’s Will Trusts [1969] 1 AC 514). A hospital must not be carried on for the purpose of making a profit for private individuals. But it may charge for services, provided the profits are not available to members or otherwise available for non-charitable purposes. A hospital may be publicly funded. But it must provide its services to the public, or a sufficiently large class of the public, to be considered of public benefit (Dal Pont, Charity Law in Australia and New Zealand, Oxford University Press, Melbourne, 2000, at 128–129).
The Court has always had power to vary the purposes of charitable trusts. However, prior to the enactment of s 69B of the Trustee Act, this could only be done by means of a cy-près scheme. A cy-près scheme can only be made where the purposes of a charitable trust have become impossible or impracticable to fulfil.
Section 69B(1) expands the circumstances in which the Court may approve a trust variation scheme. It provides:
69B—Alteration of purposes of charitable trust
(1)The purposes for which property is required or permitted to be applied in pursuance of a charitable trust may be altered by a scheme (a trust variation scheme) approved under this section in any of the following circumstances:
(a)where the original purposes, in whole or in part—
(i)have been as far as possible fulfilled; or
(ii)cannot be carried out, or not according to the directions given and to the spirit of the gift; or
(b)where the original purposes provide a use for part only of the trust property; or
(c)where the trust property could be more effectively used if combined with other property applicable for similar purposes and administered jointly with that property; or
(d)where it is not reasonably practicable having regard to—
(i)the value of the trust property; or
(ii)changes in circumstances that have taken place since the constitution of the trust; or
(iii)any other relevant factor,
to apply the trust property in accordance with the original purposes; or
(e)where the original purposes, in whole or in part—
(i)have been adequately provided for by other means; or
(ii)have ceased to be charitable purposes; or
(iii)have ceased to provide a suitable and effective method of using the trust property.
Section 69B(6) provides:
(6)If the relevant authority is satisfied, on application under this section, that the variation of the terms of a trust proposed in a trust variation scheme—
(a)accords, as far as reasonably practicable, with the spirit of the trust; and
(b)is justified in the circumstances of the particular case,
the relevant authority may approve the trust variation scheme and the approved scheme prevails over inconsistent provisions of a relevant instrument or declaration of trust.
Section 69B(3) provides that the relevant authority, where the value of the trust property exceeds $300,000, is this Court. While s 69B represents a significant legislative expansion of the Court’s capacity to vary charitable trusts, a trust variation will not be justified on the basis of mere expediency or because it appears that the trust assets could be used more beneficially for another purpose.[2]
[2] Re Trusts of Kean Memorial Trust Fund [2003] SASC 227 at [56] and [68], (2003) 86 SASR 449 at 464 and 466.
As I have mentioned, Baptist Churches did not own or conduct a hospital at the date that the will was made nor at the date when the funds were transferred to it. Pursuant to s 69B(1), I must be satisfied that the funds presently held on trust by Baptist Churches are insufficient for the establishment of a hospital in accordance with the terms of the deceased’s will before considering any proposed variation.
As I have said, I accept the evidence of Mr Scully that the funds presently held ($5,938,796.43) are insufficient to establish and maintain a fully functioning modern hospital.
Although the funds presently held on trust are substantial, it is unlikely that, at the time he executed his last will in 1965, the deceased would have been able to predict the future advancements in medicine, medical equipment, the higher costs of employing trained medical staff and the increased costs of building and equipping a fully functional hospital in the 21st century.
For these reasons I am satisfied that the original purposes of the trust established by the deceased’s last will cannot be satisfactorily fulfilled. The fact that Baptist Churches does not control an existing hospital to which the trust funds could be applied, coupled with the fact that there are insufficient funds to establish and maintain a new hospital, are relevant factors in my consideration pursuant to s 69B(1)(a)(ii) and s 69B(1)(d). It follows that a variation is justified.
I am also satisfied that the proposed alternative of a primary health care facility accords with the spirit of the trust. It will provide health care by an organisation closely associated with the trustee chosen by the deceased in his will.
Administrative provisions of the scheme
Section 69B only empowers the Court to vary the purposes of a charitable trust, in the sense of the objects to be benefited by the charity. The purposes do not include provisions dealing only with administration or the machinery for carrying out the trust purposes.[3]
[3] Re JW Laing Trust [1984] Ch 143 at 149-150, 153; Oldham Borough Council v Attorney-General [1993] Ch 210 at 221.
The Court’s power to complement a variation pursuant to s 69B of the Trustee Act, by providing the appropriate machinery to render trust purposes operable, derives from its inherent jurisdiction.
In Chinachem Charitable Foundation Ltd v Secretary for Justice & Ors, Lord Walker NPJ observed:[4]
[4] [2015] HKCFA 35 at [41].
The court has an inherent jurisdiction over the administration of charitable trusts, originally based on the notion of the sovereign as parens patriae (parent of the nation). This jurisdiction could be invoked by the Attorney General … as the sovereign’s forensic representative. Where the court exercises its jurisdiction to clarify or modify the purposes of a charitable trust, or to improve the administration of a charitable trust, it does so by making a scheme – that is, a written instrument approved by the court to regulate, in whole or in part, the future management and administration of the trust.
The power to make schemes is an aspect of the Court’s special jurisdiction in respect of charitable trusts, which is more extensive than the limited inherent jurisdiction to vary the terms of ordinary trusts.[5]
[5] Re Royal Society’s Charitable Trusts [1956] Ch 87 at 91-92;Schemes fall into two broad categories: (1) those that alter the purposes of a charitable trust (cy-près schemes); and (2) those that alter the administrative provisions of a charitable trust (administrative schemes).
Conceptually, the distinction is between means and ends. An administrative scheme clarifies, supplements or alters the machinery for the carrying out of existing charitable objects. A cy-près scheme (and now, a s 69B scheme) alters those objects.[6]
[6] Corish v Attorney-General’s Department (NSW) [2006] NSWSC 1219 at [9]; Re Robinson [1931] 2 Ch 122 at 128; Re Trusts of Kean Memorial Trust Fund [2003] SASC 227 at [47], (2003) 86 SASR 449 at 461; Re The Lutheran Laypeople’s League of Australia Inc [2016] SASC 106 at [19].
Administrative schemes enable the Court to provide all the mechanisms necessary for the carrying out of the purposes of a charitable trust. They commonly confer charity trustees with powers of management and investment of trust property.[7]
[7] See e.g. Re Royal Society’s Charitable Trusts [1956] Ch 87; Re Shipwrecked Fisherman and Mariners Benevolent Society [1959] Ch 220; Re Coates' Trusts [1959] 1 WLR 375; Re University of London Charitable Trusts [1964] Ch 282; Trustees of the British Museumv Attorney-General [1984] 1 WLR 418.
The Court has a discretion to make orders by way of a scheme to regulate the administration of a charity where it appears to the Court to be “expedient” to do so.[8] This stands in contrast to the higher thresholds which must be satisfied before making a cy-près or s 69B scheme.
[8] Re JW Laing Trust [1984] Ch 143 at 155; The Joyce Henderson Trustee (Inc) v Attorney-General (WA) [2010] WASC 60 at [33]; Re The Lutheran Laypeople’s League of Australia Inc [2016] SASC 106 at [31]-[32].
The provisions of the trust variation scheme are within the scope of the Court’s inherent jurisdiction.
Section 59B of the Trustee Act
Section 59B of the Trustee Act authorises the Court to provide trustees with increased powers of management and administration of property where it is, in the Court’s opinion, expedient to do so. It applies to charitable trusts as well as to ordinary private trusts.
Section 59B does not affect the inherent jurisdiction of the Court to make schemes in respect of charitable trusts.[9]
[9] Re Trusts of Kean Memorial Trust Fund [2003] SASC 227 at [47], (2003) 86 SASR 449 at 461.
In the present case, the specific powers in the trust variation scheme sought to be conferred pursuant to s 59B lie within the scope of the Court’s inherent jurisdiction to make an administrative scheme.
To a large extent, the inherent jurisdiction and s 59B traverse the same area. However, they are not co-extensive. Unlike the inherent jurisdiction of the Court, s 59B is confined to the conferral of powers for the management and administration of property.[10]
The powers sought to be conferred in paragraphs 8.1.3 and 8.2 of the trust variation scheme may fall outside the scope of s 59B, insofar as they are not restricted to dealings or transactions concerning the management and administration of property. However, they are clearly within the scope of the Court’s inherent jurisdiction.[11]
I am satisfied that the trust fund should be administered by Baptist Care as trustee. It is an organisation conducted under the auspices of Baptist Churches, with the requisite skills and experience to own and operate a primary health care facility.
The proposed trust variation scheme permits Baptist Care to, inter alia, purchase a property in which to operate a primary health care facility. It may employ health care professionals and may lease facilities to primary health care professionals. Importantly, it will provide similar services to the community of a nature that the deceased would have anticipated a “hospital” of his day to provide.
Conclusion
For these reasons, I was satisfied that the powers conferred upon the Court by s 69B of the Trustee Act, s 59B and its inherent jurisdiction, should be exercised to approve the proposed trust variation scheme annexed hereto.
[10] Re Dion Investments Pty Ltd [2014] NSWCA 367 at [94], (2014) 87 NSWLR 753 at 773.
[11] Re Trusts of Kean Memorial Trust Fund [2003] SASC 227 at [97], (2003) 86 SASR 449 at 471.
Accordingly, I made the following orders:
1.Pursuant to s 69B of the Trustee Act 1936 (SA) and the inherent jurisdiction of the Court the trust variation scheme set forth in the schedule hereto in relation to the trust distributions to the first plaintiff from the estate of Frederic Thomas Trevett Fricker deceased (together with all income thereon) be and is hereby approved and that subject to paragraph 2 of this order the trust variation scheme be carried into effect.
2.That the various powers sought to be conferred upon the trustee of the trust variation scheme and more particularly set forth therein in paragraphs 8, 15.3, 16 and 17 thereof be and the same are hereby conferred upon the said trustee pursuant to s 59B of the Trustee Act 1936 (SA) (as amended).
3.That the costs of the plaintiffs of and incidental to this application and the preparation of the scheme be adjudicated as between solicitor and client (or agreed) and paid out of the trust assets.
SCHEDULE
TRUST VARIATION SCHEME
for the administration of the charitable trust
administered by Baptist Churches of South Australia
1.Definitions
In this Scheme, unless a contrary intention appears:-
1.1 “Baptist Care” means Baptist Care (SA) Inc.
1.2 “Baptist Churches” means Baptist Churches of South Australia Inc.
1.3 “Primary Health Care Facility” means a Health Care Facility as more particularly defined in paragraph 4
1.4 “the deceased” means Frederic Thomas Trevett Fricker late of 1202 Old Port road [sic] Royal Park in the State of South Australia Company Director deceased.
1.5 “the Fricker Trust” means the following Trust established in the will of the deceased namely:-
“for the South Australian Baptist Union Incorporated of 61 Flinders Street Adelaide South Australia for the purposes of making additions to an existing hospital controlled by that Union and in the event of there being no such hospital then for the purposes of providing a fund for the erection of a hospital to be controlled by the South Australian Baptist Union Incorporated.”
1.6 “the Fricker will” means the last will and testament of Frederic Thomas Trevett Fricker dated 9 June 1965 and one codicil thereto dated 28 February 1973.
1.7 “the transfer date” means a date not later than three months after the date on which this Scheme is approved by the Court.
1.8 “the trust assets” mean the assets of the Fricker Trust and all income arising therein and all accretions thereto.
1.9 “the Trustee” means the Trustee of the Fricker Trust and includes the successors and assigns of the Trustee.
2. Appointment of New Trustee
2.1 Baptist Churches is the Trustee of the trust assets.
2.2 Baptist Churches is hereby empowered to execute a Deed:-
2.2.1 appointing Baptist Care as the Trustee of the trust assets; and
2.2.2 to retire as the Trustee thereof.
3. The Fricker Trust
3.1 The Fricker Trust will be administered by the Trustee.
3.2 In lieu of the provisions of the will of the deceased the Trustee will hold the trust assets upon trust for the erection, maintenance and operation of a Primary Health Care Facility controlled by the Trustee.
4. Primary Health Care Facility
4.1 For the purposes of this Trust Variation Scheme the term “Primary Health Care Facility” means a site or several sites owned or leased by the Trustee upon which:
4.1.1 there are facilities and rooms comprising (but not limited to) consulting rooms, meeting rooms, surgeries, treatment facilities, counselling facilities, offices, day hospitals, diagnostic services, and pharmacies;
4.1.2 employees or Lessees of the Trustee practise primary health care comprising (but not limited to) services pertaining to maternity care, post natal care, district nursing, hospital in the home, renal dialysis, optometry, wound management, diabetic care, orthodontic care, community mental health care and support, physiotherapy, minor skin surgery, medical reviews, rehabilitation, alcohol and drug support and counselling, outreach services, pathology, post surgery follow up support, pharmaceutical and diagnostic services;
4.1.3 Front line Primary health care services are delivered to the community by primary health care practitioners and professionals including general medical practitioners, dentists, nurses, aboriginal health workers, pharmacists, physiotherapists, psychologists, psychiatrists, social workers, dieticians and other allied health professionals;
4.1.4 the Primary Health Care services are delivered to the community telecommunications technologies such as health advice, telephone services, video consultations and remote monitoring of health metrics through electronic devices;
4.1.5 Primary Health Care services partner with hospitals and community health providers and interact with other health services;
4.1.6 Primary Health Care services are delivered to indigenous migrant and drug and alcohol dependent persons;
4.1.7 Primary Health Care services partner with home and community care, alcohol and drug treatment services, suicide counselling services, specialist disability services, aged care services and palliative care services;
4.2 The aims and objects of the Primary Health Care Facility will be to:
4.2.1 support a range of primary health care activities including (but not limited to) health promotion, disease and illness prevention, early medical intervention, treatment of acute conditions and management of chronic conditions in a manner which includes an understanding of the social context of people’s lives and the social determinants of health;
4.2.2 provide sound first level care provided by a suitably trained work force supported by integrated referral systems in a way that gives priority to those most in need, maximises community and individual self reliance and participation and involves collaboration with other health sectors in such a way that it encourages health promotion, illness prevention, care of the sick, advocacy and community development.
5. Transfer of property
On the transfer date Baptist Churches will transfer the trust assets to Baptist Care and thereafter Baptist Care shall hold the trust assets upon trust and for the objects and purposes set out in paragraph 4 and with the powers set out in paragraphs 7 to 17 of this Trust Variation Scheme.
6. Further proceedings
Any question affecting the regularity or the validity of any proceeding under this Scheme or any doubt or question arising as to the powers and authorities of the Trustee arising as a result of this Scheme or as to the application of any of the provisions of this Trust Variation Scheme or the administration of the trusts hereby created shall be referred for the advice and direction of the Court in accordance with Sections 60 or 69 (as the case may be) of the Trustee Act 1936 (as amended) or under any statutory provision amending or substituted for those Sections.
7. Powers
The Trustee shall notwithstanding the trusts hereinbefore declared and in addition to and without limiting the powers and discretions vested in the Trustee by law have the following powers and discretions namely:-
7.1 To do all such things and to sign all such documents as may be necessary or expedient to erect, maintain and operate a Primary Health Care Facility or Facilities.
7.2 To purchase a house property or home unit or dwelling place of any kind or business premises or professional rooms or to purchase land and to erect thereon a Primary Health Care Facility, a house property or business premises or professional rooms and to allow such person or persons as it may think fit to occupy the same either free of rent or at such rent as the Trustee shall think fit and generally upon such terms and conditions as the Trustee shall think fit.
7.3 To invest the trust assets in any investments for the time being authorised by the law of the Commonwealth or any State of Australia for the investment of trust funds and in debentures or debenture stock preference or ordinary shares or stock or unsecured notes of any company incorporated or carrying on business in any part of the world and whether bearing any liability for uncalled capital or not.
7.4 To invest the moneys trust assets by purchasing or otherwise acquiring units in any unit trust or by lending the same to any unit trust and any such loan may be either with or without security and either free of interest or at such rate of interest as the Trustee may think fit.
7.5 To invest in any property trust or share trust or other trust whatsoever and whether quoted on the Stock Exchange in Australia or not or in any cash management fund or in any insurance bonds of any nature or friendly society bonds of any nature or in any other investment which is recommended to the Trustee in writing by an investment adviser.
7.6 To invest the trust assets in the purchase or improvement or development of any real or leasehold property or any interest therein or in the purchase of any livestock plant equipment furniture furnishings or other personal property and to enter into any transactions to take on lease or on hire any plant equipment furniture furnishings or other personal property.
7.7 At such time or times as the Trustee shall think fit and in such manner and upon such terms and conditions as the Trustee shall think fit to sell call in and convert into money any part or parts of the trust assets which shall not consist of money.
7.8 To lease or let all or any part of the real or leasehold property which shall form part of the trust assets to any person or persons whomsoever and for such period as the Trustee shall think fit and at such rent and generally upon such terms and conditions as the Trustee shall consider to be fair and reasonable and in the absolute discretion of the Trustee to manage and superintend the management of such real or leasehold property and generally to deal therewith in a proper and due course of management as if beneficially entitled thereto.
7.9 To purchase any business or all or any assets of any business and at any time to sell the whole or part of any such business or the assets thereof.
7.10 To commence or carry on or join in carrying on any business or partnership for such period or periods as the Trustee shall think proper and to employ in such business or partnership the whole or any part of the trust assets and to employ or join in employing any person or persons at such salary as the Trustee shall think fit to conduct or manage such business and to delegate all or any of the powers of the Trustee in relation to such business to any person or persons and the Trustee shall not be liable for any loss occasioned by carrying on the business under the power herein contained.
7.11 To advance and lend moneys to and to borrow and raise moneys from and to secure by mortgage bill of sale lien or charge fixed or floating legal equitable or otherwise the payment of money to any persons firms companies corporations governmental or municipal bodies upon such terms with or without security or interest as the Trustee shall deem fit and the Trustee is hereby expressly empowered to join with any company or natural person in executing any mortgage or other document for the purpose of securing the payment of money to the Trustee jointly with any company or natural person or for the purpose of securing the payment of money to any company or natural person and if the Trustee is a company to give and to execute a registrable floating charge over all the property (both present and future) of the company and the property (both present and future) of the trust assets held by it as Trustee and to give and execute any other charge or security registrable under the Corporations Law of and the Trustee may borrow or raise moneys to be used in deriving income or gain in augmentation of the trust assets notwithstanding that the trust assets may already be wholly invested or applied or that the moneys to be borrowed or raised may exceed the sum of value of the trust assets and no lender shall be concerned to enquire as to whether the necessity for any such borrowing has arisen or as to the purpose for which it is required or as to the application of the money borrowed. Without limiting the generality of the foregoing, the Trustee shall have the power to borrow and raise moneys by way of offshore loans outside the ordinary jurisdiction and in a currency other than Australian dollars.
7.12 To give any guarantee or indemnity with or without security solely and jointly with any other company or natural person and with or without remuneration for payment of money or the performance of any contract, obligations or undertaking by any person firm company corporation or association and to secure by mortgage bill or sale lien or charge fixed or floating legal equitable or otherwise howsoever such guarantee or indemnity and upon such terms with or without security or interest as the Trustee shall deem fit and if the Trustee is a company to give and to execute a registrable floating charge over all the property (both present and future) of the company and the property (both present and future) of the trust assets held by it as Trustee and give and execute any other charge or security registrable under the Corporations Law.
7.13 To open bank accounts of every description upon such terms and conditions as the Trustee shall think fit and to conduct and operate such accounts in such manner as the Trustee shall think fit in accordance with the customs, usages and practices of banks including without limiting the effect thereof the power to operate any such account on overdraft and to agree to the bank debiting any such account with interest costs charges expenses and liabilities incurred by the bank at any time or from time to time on behalf of the Trustee and in addition to any other power herein contained to borrow or raise or secure the payment of money in such manner as the Trustee shall think fit and to secure the same or the repayment or performance of any debt liability contract guarantee or other engagement incurred or to be entered into by the Trustee in any way with such bank.
7.14 To draw make accept endorse discount execute and issue promissory notes bills or exchange bills of lading and other negotiable or transferable instruments.
7.15 To employ engage or appoint any manager solicitor accountant or agent or any other person or company to transact all or any business of whatever nature required to be done in the administration of the trust assets or under the trusts established by this Trust Variation Scheme including the receipt or payment of money and including the acquisition or holding or management of property of any nature whatsoever and the Trustee may decide the amount of such remuneration to be allowed and paid to any person so employed and of all charges and expenses so incurred.
7.16 To decide whether any moneys forming part of the trustee assets are capital or income and to decide whether any payments ought to be made out of capital or income.
7.17 To enter into any transactions hereby authorized either solely or jointly with any other person company corporation or association.
7.19 To enter into transactions or any kind hereinbefore authorized notwithstanding that the Trustee may be either directly or indirectly interested in any such transactions and without being liable to account in any way for any profit which the Trustee may make by reason of any such transactions.
7.20 To appoint any person to be an attorney of the Trustee to exercise all or any of the powers or discretions given to the Trustee hereby upon such conditions and subject to such terms as the Trustee shall deem fit and the Trustee shall not be responsible for any action (whether wrongful or otherwise) on the part of any such attorney and any instrument appointing such attorney shall continue in force until such time as revoked by the Trustee.
8. Management by Trustee
The Trustee may:-
8.1 Prescribe and alter such rules for:-
8.1.1 the government of the Primary Health Care Facility and the users thereof;
8.1.2 the management and administration of the Primary Health Care Facility;
8.1.3 the meetings of the Trustee, the mode of convening them and the conduct of business and otherwise as it thinks fit.
8.2 Delegate any of its powers and duties to any committee or committees as it may appoint for the purpose.
9. Appointment of New Trustees
If and whenever the Trustee shall think fit the Trustee may appoint a new Trustee or Trustees of the trust assets.
10. Payment of outgoings
10.1 The Trustee shall out of the income of the trust assets:-
10.1.1defray the cost of all ordinary repairs required for the purpose of maintaining the Primary Health Care Facility in a proper condition;
10.1.2insure the Primary Health Care Facility against fire and such other contingencies as it may think fit;
10.1.3pay all other charges and outgoings in respect of the Primary Health Care Facility;
10.1.4pay all proper costs charges and expenses of and incidental to the administration and management of the Primary Health Care Facility.
10.2 There shall also be paid out of the income of the trust assets such sum or sums as may be necessary for the salaries, annual leave payments, compulsory superannuation and such other amounts of and incidental to the employment of any person by the Trustee provided that such employment is directly related to the Primary Health Care Facility.
10.3 In the administration of the trust the Trustee shall so far as possible, make all the payments (including the costs and expenses incidental to the trust fund) out of interest and income but if these are not sufficient, the Trustee shall realise so much of the capital of the trust fund as will be sufficient to supply the deficiency.
11. Sinking Fund
The Trustee shall out of the income of the trust assets remaining after the making of the payments mentioned in paragraph 10 hereof create a sinking fund by setting aside out of the income such yearly sum as the Trustee thinks fit until such fund amounts to the sum of $100,000.00 (or such other sum as the Trustee may from time to time determine). The Trustee shall invest the yearly sums so set aside in the name of the Trustee in any investments permitted by law with power to the Trustee at any time to vary any such investments for others of a like nature.
12. Application of sinking fund
12.1 The capital and income of the sinking fund shall be applied by and at the discretion of the Trustee:-
12.1.1to the extraordinary structural repair of the Primary Health Care Facility or in altering, improving or rebuilding it;
12.1.2in recouping to the trust assets any loss or estimated loss arising either upon a sale of or by reason of depreciation (provided that such depreciation be likely in the opinion of the Trustee to be of a permanent and not merely temporary character) in the Primary Health Care Facility;
12.2 If in any year any of the income of the sinking fund shall not be required for any of these purposes it may at the discretion of the Trustee either be added to the capital of the sinking fund and invested accordingly or be allowed to fall into and be applied as part of the income of the trust assets.
13. Payments out of sinking fund to be made good
If any part of the capital of the sinking fund shall have been applied for any of the purposes mentioned in paragraph 12 above it shall be made up again to the sum of $100,000.00 (or such other sum as the Trustee may from time to time determine) by setting assets aside out of the income of the trust assets in the manner mentioned in paragraph 11 above the yearly sums there mentioned (such sums to be invested as provided in the same clause) until the sinking fund shall again amount to the sum determined by the Trustee.
14. Surplus income
So much (if any) of the income produced by the trust assets in any year as shall not be required to meet any costs or expenses or as a contribution to the sinking fund shall be applied in such manner as the Trustee thinks fit for the benefit of the Primary Health Care Facility.
15. Building or acquiring Primary Health Care Facility
15.1 The Trustee shall have absolute discretion as to:-
15.1.1the nature and character and the mode and time of erection or acquisition of the buildings for the Primary Health Care Facility;
15.1.2the manner of furnishing, decorating and fitting them.
15.2 The Trustee shall not be under any obligation to accept by way of gift any piece of land which it may not consider suitable for the purpose of this Trust Variation Scheme.
15.3 The Trustee shall have full power to enter into any contracts and to employ such professional or other persons and to do all such acts and things (including pulling down existing buildings, laying out gardens and yards, drainage and sanitary works and insuring against fire (incidental to or connected with the erection of the buildings or altering, adapting or adding to any existing buildings and furnishing, decorating and fitting them in such manner as the Trustee thinks desirable.
16. Other uses of Primary Health Care Facility
The Trustee may at any time:-
16.1 Permit any part of the Primary Health Care Facility to be used either free of charge or not for educational purposes (including but not limited to lectures, meetings or otherwise) if this can be done without interfering with the use of the Primary Health Care Facility.
16.2 Lease or let as it thinks fit any part of the Primary Health Care Facility which is not immediately required for the purposes of the Primary Health Care Facility.
17. Multiple Primary Health Care Facilities
17.1 Nothing in this Trust Variation Scheme shall prevent the Trustee from building or acquiring more than one Primary Health Care Facility.
17.2 The Trustee shall have full power to:-
17.2.1manage and maintain a Primary Health Care Facility on more than one site;
17.2.2sell a Primary Health Care Facility and build or acquire one or more Primary Health Care Facilities in its place at a different site or sites.
18. Interpretation and definitions
Unless qualified by or inconsistent with the context of this Trust Variation Scheme:-
18.1 A reference to one gender includes the other gender; a reference to a person includes an incorporated body or other association of persons or a Governmental agency and vice versa; the singular includes the plural and vice versa.
18.2 Where a party comprises more than one person, this Trust Variation Scheme applies to all of them together and each of them separately.
18.3 Headings are for convenience of reference and will not affect the interpretation of this Trust Variation Scheme;
18.4 In this Trust Variation Scheme where a word or phrase is given a particular meaning other parts of speech or grammatical forms of that word or phrase have corresponding meanings.
Construction Industry Training
Board v Attorney-General [1973] Ch 173 at 181, 186; Re Baker (1985) 11 DLR (4th) 430 at 441.
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