In Re the Estate of P W Peacock
[1992] TASSC 132
•16 December 1992
Serial No B55/1992
List "B"
COURT: SUPREME COURT OF TASMANIA
CITATION: In re the Estate of P W Peacock [1992] TASSC 132; B55/1992
PARTIES: IN RE THE ESTATE OF P W PEACOCK
FILE NO/S: M197/1992
DELIVERED ON: 16 December 1992
HEARING DATE: 4 September 1992
JUDGMENT OF: Cox J
CATCHWORDS:
Charities — General charitable purpose — Whether subject only to condition precedent — Whether gift on condition-cy-près scheme ordered to be prepared.
REPRESENTATION:
Counsel:
Applicant: S Allston
Respondent: I Hallett
Solicitors:
Applicant: Crown Solicitor
Respondent: Director of Public Prosecutions
Judgment Number: B55/1992
Number of paragraphs: 13
Serial No B55/1992
"List "B"
File No M 197/1992
IN RE THE ESTATE OF P W PEACOCK
REASONS FOR JUDGMENT COX J
16 December 1992
By his will, dated 7 February 1921, William Davidson Peacock devised his residence in Swan Street, Hobart to his trustees upon trust for his wife, Agnes Isabella Peacock, for her life, and at her death upon trust to convey assure and transfer the same to the government of Tasmania, or to such committee of management as the government should appoint, provided that the government should agree to hold the same upon certain conditions, of which the first is as follows: "To establish therein a Hospital or Home for persons suffering from incurable diseases or if that was considered impracticable such a home or Institution for the alleviation of human suffering as the said Government of Tasmania might decide upon it being his earnest wish that as no such Hospital or Home existed in Tasmania such a Hospital or Home should be established and should be known as "The W D Peacock Home for Incurables' or some like designation."
If the government should accept the devise of the testator's residence upon the conditions stated, he devised and bequeathed all the residue of his estate to his trustees upon trust to convert such residue into money, to invest the proceeds, and to apply the income towards the maintenance and upkeep of the hospital.
The testator died on 16 November, 1921, and his will was duly proved on 9 March, 1922. His widow died on 26 August, 1940.
On 10 April, 1941, upon the petition of the trustee, Morris CJ ordered and declared that upon the true construction of the will the provisions relating to his residence at the death of the testator's widow would be properly administered and carried into effect by the conveyance, assurance, and transfer of the property to the government or a committee of management, "to be used by the said Government for the establishment in the said property of a Convalescent Hospital for patients recovering from serious illness who needed further treatment than that which they had already received at a public hospital but for whom the existing Public Hospital could not provide accommodation ..."
The government of Tasmania accepted the devise of the testator's residence upon the conditions set forth in the will and the order of the Chief Justice. The residence was surrendered to the Crown and the then Chief Secretary declared that he would stand possessed of the residence on the trusts set forth in the will and the order. The hospital was named "The Peacock Convalescent Hospital."
After an increase at the beginning of 1956 in the fees charged by public hospitals fewer patients entered the hospital because fewer entered the public hospital and those that did went home as soon as possible. The committee of management desired, therefore, to make the hospital available to as large a number of sick persons as possible by enabling patients from private hospitals to secure admission when there are insufficient patients from public hospitals.
A petition was accordingly presented, by the Attorney–General praying that the trust "be varied by providing for the admission to the said Home of persons recovering from serious illness who need further treatment than that which they have already received at a hospital (whether a public hospital or a private hospital) but for whom the existing hospital could not provide accommodation.
Gibson J held that the enlargement of the class of beneficiaries by qualifying former patients of private hospitals to apply for admission to the Peacock Convalescent Hospital would not add an object not strictly charitable, the relief of impotence being an independent object of charity not requiring any element of poverty, and he approved the scheme proposed by the prayer of the petition (In re Peacock's Charity [1956] Tas S R 142).
Thereafter for several years the hospital was used for the purpose derived from the testator's will, sanctioned by the Order of Morris CJ, declared by the Chief Secretary, and varied by the Order of Gibson J. Some years prior to 1991 the usage of the hospital had altered from a true convalescent function serving patients recovering from serious illness after treatment in a public or private hospital. The modern medical approach to patients recovering from serious injury and still requiring in–patient hospital treatment is to simultaneously provide them with intensive rehabilitation in purpose–built facilities beyond the capacity of the Peacock Hospital, while the improvements in surgery have reduced the requirement for post–surgical hospital care enormously, intensive home nursing being the preferred option. In view of the lack of a need for the kind of convalescence previously available at the hospital it was altered to a facility which accommodated elderly people who awaited nursing home care. This function however was transferred to the St John's Park complex and since June 1991 the hospital has been used for the rehabilitation and support of patients with mental illness. The kind of rehabilitation programmes being administered at the hospital is described in the following paragraph of Dr Westhead's affidavit:
"10 Rehabilitation programmes place emphasis on patients' responsibilities and rights through the acquisition of better coping skills. Staff of the rehabilitation and Support Services organise programmes aimed at developing or enhancing survival skills which cannot as readily be taught within the confines of a psychiatric hospital. The survival skills required include those of being able to manage money, organise budgets and cope with accommodation and related matters. Staff encourages patients to develop social and communication skills, community living skills, personal living skills, modify inappropriate behaviour, develop a sense of belonging and enhancing self–esteem with the aim of becoming members of, and contributing to, the local community."
In my view the original purpose of the trust as varied by the Order of Gibson J is not being and cannot practicably be carried into effect due to the altered circumstances to which I have referred. I am in no doubt that the testator exhibited a general charitable intention so as to make the cy–près doctrine available by way of remedy. Gibson J so found (In re Peacock's Charity (supra) at 145) and I respectfully agree.
Counsel for the Attorney–General who brings this application in right of the Crown as parens patriae supports that interpretation and seeks an order that a cy–près scheme be prepared for consideration by the court. The Crown however claims to have a private interest and in these circumstances I gave leave to counsel for the Solicitor–General in accordance with the practice approved in Attorney–General v The Cordwainers' Company (1833) 3 MY & K 534; 40 ER 203 and adverted to in Tudor on Charities 6 Edn at 450 to argue that the Crown took the devise pursuant to a conditional gift. Counsel for the Solicitor–General submits that although Gibson J held there was a general charitable trust susceptible of cy–près orders, that issue was not argued before him. He submits that the testator imposed a condition precedent to the devise of the land of the Government which, once fulfilled, entitled the Government to beneficial ownership of the property. The condition precedent he submits was the agreement of the Government to hold it upon the conditions he set out in his will. Counsel likened the position to that in Roche v M'Dermott (1901) Vol 1 Ir R 394 where a gift of money to the Society of St Vincent de Paul for the benefit of the poor was given on condition that the committee of the Society should undertake in writing to have the railings of two graves painted once every three years indefinitely. The Master of the Rolls held this to be a condition precedent, not unlawful in itself, although enforcement of it was not possible because of the rule against perpetuities and that it was a valid gift to the Society, the testator being entitled to make the gift conditional upon the committee giving that unenforceable assurance (see also In re Richardson dec'd (1887) 56 LJ Ch 85). In the present instance however the Government not merely agreed to hold the property upon the condition stipulated but by its Chief Secretary executed a declaration of trust accepting those conditions and holding itself bound thereby. Even if there is any validity in the proposition that the devise was subject only to a condition precedent that the Government should express its agreement to the term stipulated, the trust with which I am concerned is that constituted by the declaration of trust executed by the Chief Secretary which has overtaken the gift claimed to be made absolute by the fulfilment of that condition. For the same reasons, in my view, the second contention of counsel for the Solicitor General that the gift conferred by the will was a gift on condition within the meaning of Lord Cairns' first class of gifts which he mentions in Attorney–General vThe Wax Chandlers Company (1873) LR 6 HL 1 at 19 fails in limine. The Crown as the result of the Chief Secretary's declaration of trust has declared itself a trustee for the purposes of carrying out the objects of the testator's bounty as approved by the Order of Morris CJ.
The Perpetual Trustees Tasmania Limited is the trustee of the testator's will and holds the sum of $1,328.48 being the residue of the estate, such residue being held upon trust pursuant to condition 5 of the will to be invested and the income therefrom to be applied in and towards the maintenance and upkeep of the hospital should the Government accept the devise. It is not disputed that if it is appropriate to direct that a cy–près scheme be prepared, the capital sum should be applied towards such purpose as is determined by the court to be appropriate.
I accordingly direct that a cy–près scheme be prepared.
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