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Cram Foundation v Corbett-Jones

Cram Foundation v Corbett-Jones

Case [2006] NSWSC 495 26 May 2006

Successor Corporation

Trusts & Equity

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CITATION: Cram Foundation v Corbett-Jones & anor [2006] NSWSC 495

HEARING DATE(S): 24 October 2005

JUDGMENT DATE :
26 May 2006

JURISDICTION: Equity Division

JUDGMENT OF: Brereton J

DECISION: Order appointing representative of next-of-kin pursuant to UCPR, r 7.6. Declarations that gift in will is valid charitable gift, that plaintiff is successor of original trustee and holds on trusts of will, that gift over is void and that original purposes of trust are no longer suitable and effective method of using trust property. Order for implementation of cy pres scheme.

CATCHWORDS: TRUSTS – Charitable trusts – Procedure – difficulty in ascertaining and finding next-of-kin – whether representative should be appointed - Trustees – corporation assumes charitable functions and assets and liabilities of unincorporated society – whether corporation is successor of unincorporated society - Charitable gifts – gift for charitable purposes “as a memorial” to testator’s family – whether charitable – Perpetuities - gift to charity with gift over on failure of charitable purpose – whether gift over void for perpetuity – whether at common law grantor’s possibility of reverter upon termination of determinable fee is affected by rule against perpetuities - Schemes – Cy pres – for supervening impossibility – where original purposes have ceased to provide a suitable and effective method of using the trust property, having regard to the spirit of the trust – supervening failure of charitable purpose in context of void gift over – where particular charitable intent only –- general charitable intention not required – absolute gift required - distinction between limited or determinable interest and conditional interest - where gift not one for a limited period or until the occurrence of a particular event, but absolute gift to charity subject to a gift over on void condition subsequent – gift takes effect unconditionally and absolutely - cy pres is available - scheme approved.

LEGISLATION CITED: Charitable Trusts Act 1993 (NSW), ss 9, 10, 23
Charities Act 1960 (UK)
Disability Services Act 1993 (NSW)
Methodist Church Union Act 1929 (UK)
Perpetuities Act 1984 (NSW), ss 3(1), 4(1), 14(2)
Uniform Civil Procedure Rules (NSW), r 7.6

CASES CITED: ANZ Executors & Trustee Co Ltd v Trustees for the Presbyterian Church of Australia (NSWSC, Waddell CJ in Eq, 12 June 1990)
Attorney General for New South Wales v Fulham [2002] NSWSC 629
Attorney-General for Northern Ireland v Forde [1982] NI 1
Attorney-General v Cummins (1906) 1 IR 406n
Attorney-General v Pyle (1738) 1 Atk 435
Bath and Wells Diocesan Board of Finance v Jenkinson [2001] WTLR 353
Cabouche v Ramsay (1993) 119 ALR 215
Dean v Dean [1891] 3 Ch 150
Gibson v South American Stores (Gath & Chaves) Ltd [1950] Ch 177
Hancock v Watson [1902] AC 14
Hixon v Campbell (1924) 24 SR(NSW) 436
Hopper v Corporation of Liverpool (1944) 88 Sol Jo 213
Mary Portington’s Case (1613) 10 CoRep 35b
Matthew Manning’s Case (1609) 8 CoRep 94b, 77 ER 618
Newis v Lark (1571) 2 Plowd 403
Pearks v Mosely (1880) 5 App Cas…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Cram Foundation v Corbett-Jones

Details

AGLC: Cram Foundation v Corbett-Jones [2006] NSWSC 495
Case: [2006] NSWSC 495
Decision Date: 26 May 2006

CaseChat Overview and Summary

Cram Foundation v Corbett-Jones was a case that reached the court regarding the administration of a charitable trust. The dispute centred around the challenges faced in determining the next-of-kin of a testator and whether a representative should be appointed. Additionally, the case involved the transfer of charitable functions, assets, and liabilities from an unincorporated society to a corporation, with the question of whether the corporation was the successor to the society. The court was also tasked with deciding the charitable nature of a gift intended as a memorial to the testator’s family, and the validity of a gift over on the failure of a charitable purpose. Furthermore, the case examined the application of the rule against perpetuities to a gift over, and whether cy-près application was appropriate in the context of a supervening failure of charitable purpose.

The legal issues addressed by the court required a detailed analysis of the principles governing charitable trusts, including the ascertainment of beneficiaries, the succession of charitable functions, and the validity of gifts over. The court examined whether a representative should be appointed to manage the trust when next-of-kin could not be located, and whether a corporation could be deemed the successor to an unincorporated society. The nature of the gift intended as a memorial was scrutinized to determine if it qualified as a charitable purpose. The court also delved into the rule against perpetuities, considering its impact on the validity of a gift over. Additionally, the court assessed the appropriateness of applying the cy-près doctrine to a supervening failure of charitable purpose.

The court reasoned that the trustees should appoint a representative if next-of-kin could not be identified, ensuring the trust could be administered effectively. It found that the corporation was the successor to the unincorporated society, assuming its charitable functions, assets, and liabilities. The gift intended as a memorial to the testator’s family was deemed charitable, as it served a purpose aligned with the spirit of charitable giving. The court held that the rule against perpetuities did not affect the grantor’s possibility of reverter in the context of a determinable fee, and thus, a gift over on the failure of a charitable purpose was valid. Finally, the court approved a cy-près scheme to address the supervening failure of the charitable purpose, emphasizing the need for an absolute gift and the distinction between limited or determinable interests and conditional interests.

The final orders of the court included the appointment of a representative for the trust if next-of-kin could not be located, the recognition of the corporation as the successor to the unincorporated society, and the approval of the cy-près scheme to address the supervening failure of charitable purpose. The court's decision provided clarity on the administration of charitable trusts, the succession of charitable functions, and the application of legal principles to ensure the continued effectiveness of charitable purposes.

Orders