Coral Levett v Attorney General in and for the State of New South Wales
[2014] NSWSC 1787
•15 December 2014
Supreme Court
New South Wales
Medium Neutral Citation: Coral Levett -v- Attorney General in and for the State of New South Wales [2014] NSWSC 1787 Hearing dates: 24 November and 4 December 2014 Decision date: 15 December 2014 Jurisdiction: Equity Division Before: Nicholas AJ Decision: The amendments to the Scheme should be made. The costs of all parties be paid out of the assets of the Trust
Catchwords: EQUITY - trust and trustees - charitable trust - scheme required application of funds for general purpose of encouraging, assisting and promoting nursing education - application to amend scheme to meet changes in the nursing profession and nursing education since 1992 - cy pres scheme under s 9 Charitable Trust Act 1993 - turns on facts - no question of general principle Legislation Cited: The Charitable Trusts Act 1993
Trustee Act 1925Cases Cited: Attorney General for New South Wales v Fred Fulham & Ors [2002] NSWSC 629
Hunter Region SLSA Helicopter Rescue Service Ltd v Attorney General of New South Wales (2013) NSWSC 1749Category: Principal judgment Parties: Coral Levett - First Plaintiff
Gary Clark - Second Plaintiff
Brett Holmes - Third Plaintiff
Judith Kiejda - Fourth Plaintiff
Carol Coombes - Fifth Plaintiff
Susan Pearce - Sixth Plaintiff
John Kemsley-Brown - Seventh Plaintiff
Attorney General in and for the State of New South Wales - DefendantRepresentation: Counsel:
C.D. Norton - Plaintiffs
J.E. Davidson - Defendant
Solicitors:
NEW Law Pty Ltd - Plaintiffs
Crown Solicitors Office - Defendant
File Number(s): 2014/230355
Judgment
HIS HONOUR: On 8 December 2014 I made orders, by consent, that:
1. That the Edith Cavell Trust, as established by way of a Scheme in Order 3 made by this Court in proceedings No. 5511 of 1991 on 12 February 1992, shall be administered in accordance with the Scheme set out in annexure A to the Further Amended Summons.
2. The costs of all parties are to be paid out of the assets of the Trust.
These are my reasons.
The plaintiffs' application was to amend the terms of the scheme (the "Scheme") for the administration of the Edith Cavell Trust ("Trust") which was established by order of this Court made on 12 February 1992 in proceedings no. 5511 of 1991.
The application was supported by the affidavits of Kathleen Evelyn Baker sworn 5 August and 19 November 2014, and of Kathryn Anne Adams sworn 2 December 2014. Ms Baker is a distinguished member of the nursing profession, with over 48 years experience in nursing and midwifery. Ms Adams has similar experience in nursing and midwifery, and is presently the manager of the Professional Services of the New South Wales Nurses and Midwives Association. They deposed to the extent of changes in the nature of the nursing profession, and in the methods of delivery of nursing education since 1992.
The following background is taken from the agreed Statement of Facts which was prepared by the parties' representatives for inclusion in these reasons, and which I gratefully adopt.
Statement of Facts
Introduction
1. Edith Cavell was an Australian nurse who is renowned for her work on the fronts during the First World War. Her work was much publicised and generated much public awareness for the profession of nursing.
2. The current Edith Cavell Trust is named after Edith Cavell. It was formed by orders of the Supreme Court of NSW made by Cohen J on 12 February 1992 in proceedings 5511of 1991 (Taylor and ors v Attorney-General and anor - "the 1992 Proceedings") permitting the pooling or fusing of the funds, assets and income of five separate charitable trusts. Those orders required the Trust to be administered in accordance with a Trust Scheme appended to the orders ("the Scheme").
3. The five former charitable trusts the subject of the 1992 proceedings were the following trusts:
a) The Penlee Trust
In 1916, Mr William Edward Shaw made a gift on trust of a large house known as "Penlee" at Summer Hill. The Union Trustee Company of Australia Ltd was appointed as trustee of the property. The house was to be used for the purposes of a 'rest house' for trained nurses, known as the Edith Cavell Memorial House. A condition of the gift was that Army nurses be entitled to preferential use of Penlee during and for a period following any war. Penlee was to be managed by the Executive Committee of the Edith Cavell Memorial Association.
Penlee was sold in or about 1964 and the funds placed in trust. The Supreme Court subsequently made orders empowering the trustee to lend amounts from time to time to the Australian Trained Nurses Association (ATNA) for the purposes of constructing an accommodation facility for trained nurses, with a preference for nurses in the Australian Forces during wartime. A further variation was made in 1966. The Penlee Trust subsequently involved the provision of money to the ATNA for maintenance and upkeep of this facility, in Whitton Road, Chatswood, for the housing of aged nurses. The Whitton Road property was sold in 1990 and the proceeds were held in trust.
b) The Benevolent Fund
The Benevolent Fund was a fund established by the ATNA for the purpose of assisting members of the ATNA who were unable to work due to incapacity through accident or illness.
c) The A M Kellet Memorial Fund
The A M Kellet Memorial Fund was established by the ATNA to provide a prize to the nurse who was awarded the highest marks in the final examination conducted annually by the NSW Nurses' Registration Board.
d) The Rachel Betteridge Memorial Fund
The Rachel Betteridge Memorial Fund was established by the will of John Wallace Betteridge for the purpose of providing an annual prize to the member of the ATNA attaining the highest degree of proficiency in some branch of nursing as the Council of the ATNA might determine.
e) The ATNA Edith Cavell Memorial Home Trust
The ATNA Edith Cavell Memorial Home Trust was created by order of the Supreme Court on 17 December 1973. Its purpose was to hold in trust the Whitton Road property and conduct it as a home for aged trained nurses.
Because of changes in social circumstances since the making of the orders in 1973 creating the ATNA Edith Cavell Memorial Home Trust, there was in 1992 no longer any call or requirement for housing for aged nurses.
The 1992 Proceedings and the purpose of the Cavell Trust
5. The 1992 Proceedings proceeded on the basis of 16 Statement of Facts filed in Proceedings No 5511 of 1991.
6. It was agreed in those proceedings that:
a) all five trusts shared as their originating purpose a benefit to the nursing profession;
b) there was a substantial need, likely to be indefinite, for awards, scholarships, and other study assistance within the nursing profession to assist it to adjust to the increased technical demands of nursing;
c) the purpose of the orders sought (and ultimately made) in those proceedings was to amalgamate the five trust funds and establish a scheme for the investment of the capital with a view to preserving its value together with the use of income to award scholarships and other assistance to promote nursing education.
7. The Scheme provides that the general purpose of the Trust (for which its funds are to be applied) is "for the general purpose of encouraging, assisting and promoting nursing education" (Scheme, cl 5(b)(i)).
8. The Scheme makes provision for grants, awards or loans to be made to financially assist nurses, nursing students and nursing organisations in the furtherance of:
(i) accredited nursing studies;
(ii) such academic research programmes as are approved by the Trustees in the theory or practice of nursing work; or
(iii) clinical nursing education programmes at basic, post-basic and continuing educational professional development level;
in accordance with certain specified categories. Those categories are:
Category 1
Shall be available to students of nursing undertaking full-time studies leading to initial registration as a nurse on a needs or merit basis.
Category 2
Shall be available to registered or enrolled nurses wishing to undertake:
(i) short-term accredited clinical nursing education programmes not in excess of six months' duration on a full-time or part-time basis; or
(ii) accredited nursing conference or seminars relevant to the applicant nurse's clinical practice;
in each case on a needs or merit basis.
Category 3
Shall be available to a properly constituted nursing organisation, faculty or school of nursing or to a registered or enrolled nurse wishing to:
(i) undertake in the case of a nurse full-time relevant post-basic studies at a properly approved educational institution for a period of periods in excess of six month's [sic] duration;
(ii) undertake in the case of a nurse academically approved research programmes in the theory or practice of nursing work; or
(iii) in the case of an institution conduct or fund relevant professional or clinical nursing educational projects.
Changes in nursing education
9. The evidence in these proceedings establishes a number of relevant changes in nursing education since 1992 that impact upon the ability of the Scheme to provide assistance.
a) University based education, part-time and distance education
10. Prior to 1985, nurses were educated through hospital-based training. However, over the period between 1985 and 1993, education moved to a university-based model.
11. Since the move to a university-based model, the need to provide education to persons in rural and remote areas, coupled with the rise in access to computers and the internet, has led to an increase in the use of distance education programs. In Australia today, almost every university provides distance education or online education, including in nursing and midwifery at universities where those courses are offered. Though the majority of students still complete their degrees face-to-face, distance education, or multi-modal teaching (a combination of face-to-face and distance) makes up a substantial component of nursing education, which generally increased between 2002 and 2011.
12. Distance education is important in attracting staff to work in rural areas. In addition, city-based nurses and midwives can use distance education where their lifestyle and work patterns do not suit more formal face-to-face education.
13. Distance education (including online courses) is also used for the purposes of delivering:
. Short-term courses, conferences and seminars that may be relevant to the mandatory continuing professional development requirement of 20 hours a year for nursing and midwifery professionals;
. Post-basic (that is, postgraduate) training of nurses; and
. Provision of training to assistants in nursing and assistants in midwifery.
14. The current categories 1 and 3(i) under the Scheme restrict grants, awards or loans only to full-time nursing students, while category 2(i) is restricted to courses offered on a full-time or part-time basis, which today has the effect of restricting assistance to a much smaller proportion of students than was the case in 1992.
15. Ms Baker, former Chief Nursing Officer (NSW) has affirmed an affidavit in these proceedings. Her evidence is that she considers distance education, part-time education and multi-modal delivery will continue to play a significant role in nursing education in the foreseeable future.
b) Midwife education
16. In 1992, the occupation of midwifery was regarded as a component of nursing. Midwives were initially educated as nurses, and following their nursing training would train further to receive a graduate diploma in midwifery.
17. Over the past decade, there has become available an alternative path of entry into midwifery. Whilst midwives can still enter midwifery via nursing education, there is also now a direct entry pathway into midwifery via a separate degree that does not have nursing as a prerequisite.
18. In 1992 the term "nursing profession" would have been understood to include midwives. However, today the profession of midwifery is separately regulated via a separate register of midwives, established by the Nursing and Midwifery Board of Australia in 2010.
19. The current categories under the Scheme do not refer specifically to midwifery students or practitioners. This would not have been necessary in 1992 since such people would have been considered to be nurses or nursing students.
Changes within the nursing profession - midwives, assistants in nursing and assistants in midwifery
20. Since 1992, there has been a change in the allocation of work previously done by persons who were part of the "nursing profession" at that time.
21. As set out above, the profession of midwifery is now regulated as a profession separate to nursing, which was not the case in 1992.
22. Associated with the development of midwifery as a separate profession, there has developed a further group known as Assistants in Midwifery. Assistants in Midwifery did not exist in 1992, but today they work alongside midwives in planning, providing and documenting patient care. These positions are filled by midwifery students studying for a degree in midwifery. There are presently no Assistants in Midwifery who are not studying for such a qualification.
23. Assistants in Nursing existed as a group in 1992, in relatively low numbers. At that time, persons designated as "Assistants in Nursing" were employed mostly in aged care facilities. Now, Assistants in Nursing are able to receive qualifications in acute care and are able to play a more general role in the delivery of patient care.
24. Assistants in Nursing are now often performing tasks which, in 1992, were the exclusive domain of registered or enrolled nurses. Assistants in Nursing are not licensed or registered by the Nursing and Midwifery Board of Australia.
25. In order to work as an Assistant in Nursing in the NSW public health system, a person must hold as a minimum a Certificate III under the Australian Qualifications Framework. Certificate III qualifications are currently available in both the areas of health care assistance, and in aged care. However, whilst a Certificate III qualification is essential for acute care workers in the public health system, persons working as Assistants in Nursing in aged care are not required to have any minimum qualifications.
26. The current categories under the Scheme do not refer to Assistants in Nursing or Assistants in Midwifery. Accordingly, in the case of Assistants in Nursing, unless such people are qualified for assistance for some other reason (such as that they are also students of nursing) they are not eligible for assistance.
Changes in name
27. The following organisations named in the Scheme have changed their names since 1992:
a) "NSW Nurses Association" is now known as "NSW Nurses and Midwives Association";
b) "Australian Nursing Federation" is now known as "Australian Nursing and Midwifery Federation"; and
c) "NSW College of Nursing" is now known as "Australian College of Nursing".
No power to accept gifts or bequests
28. The Trust currently has no power to receive donations and benefactions.
A marked-up copy of the Scheme which indicates the amendments ordered to be made in the present proceedings is annexure A to these reasons.
The Court's jurisdiction to make the amendments sought, with the exception of the addition of cl 6(i), is under s 9 of The Charitable Trusts Act 1993, (the "Act") which provides:
9 Extension of the occasions for applying trust property cy pres
(1) The circumstances in which the original purposes of a charitable trust can be altered to allow the trust property or any part of it to be applied cy pres include circumstances in which the original purposes, wholly or in part, have since they were laid down ceased to provide a suitable and effective method of using the trust property, having regard to the spirit of the trust.
(2) References in this section to the original purposes of a charitable trust are to be construed, if the application of the trust property or any part of it has been altered or regulated by a scheme or otherwise, as references to the purposes for which the trust property are for the time being applicable.
The present application proceeded as an application for a cy pres scheme.
In Attorney General for New South Wales v Fred Fulham & Ors [2002] NSWSC 629 Bryson J said:
"16. However s 9 of the Charitable Trusts Act 1993 has widened the grounds on which the Court may act, in that it is no longer necessary that actual compliance with the original terms should be impossible. It is now enough that they have ceased to provide a suitable and effective method of using the trust property.
...
17. The Court may alter the purposes of a charitable trust where the original purposes have ceased to provide a suitable and effective method of using the trust property; this is well short of a test requiring impossibility. Subsection 9 (1) greatly widens the circumstances in which the Court may act and the influence which it may allow considerations of practicality to have."
In Hunter Region SLSA Helicopter Rescue Service Ltd v Attorney General of New South Wales (2013) NSWSC 1749 White J said:
"37 In my view, s 9 can be applied proleptically. Section 9 is remedial and beneficial legislation and not to be narrowly construed. A construction of s 9 that the court could not make an order altering the original purposes of a charitable trust until those purposes have ceased to provide a suitable and effective method of using the trust property, even though it will then be too late to do anything about it, should not be adopted if an alternative construction is reasonably available. Section 9(1) does not purport to state exhaustively the circumstances in which the court can alter the original purposes of the charitable trust. The section says that the circumstances in which those original purposes can be altered "include" circumstances in which the original purposes have ceased to provide a suitable and effective method of using the trust property having regard to the spirit of the trust. As the power can be exercised in those circumstances, it is only logical that it can also be exercised if it is shown that the original purposes will cease to provide a suitable and effective method of using the trust property having regard to the spirit of the trust.
38 By s 11 the trustee of a charitable trust is under a duty, if the case permits and requires the trust property or any part of it to be applied cy-près to secure its effective use for charitable purposes, to take steps to enable it to be so applied. This provision makes it clear that the court can make orders for trust property to be applied cy-près to secure its effective use for charitable purposes in anticipation and prevention of events that would otherwise prevent the property being effectively applied for the original purposes of the charitable trust."
The amendments sought were:
(a) amendments to the existing categories in which assistance is awarded, with the effect of adding midwives, assistants in nursing, assistants in midwifery, students of and education programmes in midwifery to the potential recipients of funds; and midwifery education to the eligible forms of study;
(b) amendments to the categories of assistance to include additional methods of course delivery, including courses studied part-time, and by distance education;
(c) an amendment to remove the nominated investment fund;
(d) amendments to update references to the names of various professional organisations;
(e) an amendment to include a general power to receive gifts and bequests.
The parties agreed that the spirit of the Trust is for the promotion of nursing education as a benefit to the nursing profession, as those terms were understood in 1992, and for the assistance of those engaged in such nursing education.
The plaintiffs submitted that most of the changes sought were to ensure that the categories of assistance available, and the persons to whom that assistance is available, remain relevant to nursing education in modern times.
In 1992 the occupation of midwifery was regarded as a component of nursing, and the term "nursing profession" would have been understood to include midwives. Today, the profession of midwifery is separately regulated under a separate registrar of midwives established in 2010 by the Nursing and Midwifery Board of Australia. Assistants in midwifery are persons who work with midwives in providing patient care, and who are studying for a degree in midwifery. Apparently, this occupation did not exist in 1992.
Details of the nature of, and qualifications for, the occupation of an assistant in nursing are described above (Statement of Facts paras 23 - 26),
The present categories under the Scheme make no specific reference to midwifery students or practitioners, or to assistants in nursing or assistants in midwifery. The evidence shows the extent which these occupations, and the modes of delivery of education and training for them, have emerged and developed since 1992. However, because the categories under the Scheme make no specific reference to midwifery students or practitioners, or to assistants in nursing or assistants in midwifery, such persons are not eligible to receive assistance from the Trust.
It is clearly within the spirit of the Trust that those persons who meet the descriptions specified in the proposed amendments be included as persons eligible for assistance. That they are presently precluded from receiving assistance indicates that the existing scheme is no longer adequate to provide a suitable and effective method of using the Trust property.
There is a need for the alterations sought. For example, left unchanged, under categories 1 and 3(i) assistance is restricted to full time nursing students, and under category 2(i) to full time or part time courses which, today, have the effect of restricting assistance to a much smaller proportion of students than was the case in 1992.
In circumstances where the Trust property may not be suitably and effectively used, it is open to remedy the Scheme by altering the Scheme cy pres. Section 9 of the Act is remedial and beneficial legislation, not to be narrowly construed. Section 9(1) greatly widens the circumstances in which the Court may act, and the influence which it may allow considerations of practicality to have: (Hunter Region SLSA Helicopter Rescue Service Ltd v Attorney General of New South Wales paras 35, 37; Attorney General for New South Wales v Fred Fulham & Ors paras 16,17).
In this case the effect of the alterations enables the Trust to proceed with the general purpose of encouraging, assisting, and promoting nursing education as a benefit to the nursing profession with regard to the modern realities of the nature of the nursing profession and the methods of delivery of nursing education. The proposed amended Scheme would thus enable the Trust to respond effectively to the changes since 1992 to the nursing profession and nursing education. Considerations of practicality provide strong support for the alterations sought.
Consistently, the alterations which recognise changes in the names of the various professional organisations should also be made.
With respect to the alteration to cl 4, the necessity for the authority to invest in the Rothschild "Five Arrows Charities and Authorised Trust" no longer remains following the amendment in 1998 to s 14 of the Trustee Act 1925. The section confers powers upon trustees, unless expressly forbidden by the instrument creating the trust, to invest trust funds in any form of investment, and at any time vary any investment. In this case there is no such prohibition. In the circumstances, the alteration should be made by deleting the name of the trust.
With respect to the addition of cl 6(i) it is self-evidently expedient that the Trust should have the power to receive donations and benefaction. Accordingly, it is appropriate that the Court pursuant to s 81(1) of the Trustee Act 1925 confer upon the trustees the necessary power as formulated in cl 6(i).
For these reasons I held that the amendments to the Scheme as sought by the plaintiff, and with which the Attorney General agreed, should be made. It was also appropriate to order, by consent, that the costs of all parties be paid out of the assets of the Trust.
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Annexure A (PDF)
Decision last updated: 15 December 2014
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