In the Matter of the Former Modbury Primary School No. Scgrg-96-2287 Judgment No. 6379 Number of Pages 4 Equity

[1997] SASC 6379

IN THE SUPREME COURT OF SOUTH AUSTRALIA

WILIAMS, J

CATCHWORDS:

Equity - trusts and trustees - application for declaration as to whether land subject to charitable trust - admissibility of secondary evidence as to terms of a trust - evidence insufficient to support existence of trust - Minister free to dispose of land. Trustee Act s69B s69B(3); Real Property Act , referred to. City of Burnside v Attorney General (1993) 61 SASR 107; Registrar of Accident Compensation Tribunal v Federal Commissioner of Taxation
(1993) 1 78 CLR 145; Kinloch v Secretary of State for India (1882) 7 App Cas 619, applied.

HEARING:

ADELAIDE, 25 August 197 (hearing), 26 September 1997 (decision)

#DATE 26:9:1997

#ADD 7:10:1997

Appearances:

Applicant Attorney General for the State of South Australia:

Counsel: Mr W Rudd

Solicitors: Crown Solicitor (SA)

Participant (amicus curiae) Solicitor General for the State of South Australia:

Counsel: Mr Bm Selway QC with him Ms R Gray

Solicitors: Solicitor General

Order: declaration that the evidence is insufficient to support the existence of a trust so as to bring its administration within the jurisdiction of the Court.

WILLIAMS J:

1. The Nature of the Application

This is an application by the Attorney General for South Australia for a declaration as to whether the land upon which the former Modbury Primary School was constructed is the subject of a charitable trust. The land is that comprised in Certificate of Title Register Book Volume 4400 Folio 737 and the Minister for Education Employment and Training (in whose name the land is vested) is desirous of disposing thereof as surplus to requirements.

The land in question was acquired by The Minister controlling Education (as the office was then described) pursuant to an indenture dated 1 March 1881. An examination of the terms of the indenture and relevantly the Ministerial docket No.1938 of 1880 entitled "Site for school Modbury" raises the possibility that the land may be the subject of a charitable trust.

Accordingly in his capacity as patrens patrine the Attorney has sought to invoke the jurisdiction of the court for the purpose of obtaining declaratory relief and with a view to obtaining further orders by way of variation of the Trust in accordance with s69B of the Trustee Act if, indeed, a charitable trust has attached to the land.

The Attorney General was represented before me by Mr WL Rudd of counsel to advance the argument supporting the existence of a trust for educational purposes. I gave leave to the Solicitor-General for South Australia, Mr BM Selway QC to appear with Ms Gray as amicus curiae for the purposes of presenting an argument in opposition to the Attorney's contention. I acknowledge this assistance. The value of the land exceeds $250,000 and therefore in accordance with s69B(3) of the Trustee Act (assuming that a charitable trust exists) the Attorney is unable to deal with this matter without invoking the jurisdiction of the Supreme Court. However, the preliminary question is whether or not a trust exists.

2. The History of the Land

The land in question originally formed part of a larger parcel which was acquired by Robert Symons Kelly in 1847. The Government docket was opened on 17 September 1880 or thereabouts. It discloses negotiations between Mr Kelly and the Highercombe School Board of Advice which were constituted on 11 September 1880 whereby the Board at a special meeting held to consider the sites for schools at Modbury and Hope Valley resolved as follows:

"That the offer of Mr Kelly of a site for School, part of Section 842 and adjoining the Wesleyan Chapel land, be accepted, Mr Kelly offering the same free of cost."

In fact, that proposal never eventuated.

A notation on the file by Mr Hosking, the School Inspector, dated 9 October 1880 reads as follows: "Accompanied by Mr Kelly, I have examined the site recommended by the Board of Advice, adjoining the Wesleyan Chapel land. I think, instead of the strip proposed, it would be better to have a square block; and this Mr Kelly is willing to give on the N.W. corner of same section (No.842)

This too is the preferable position - free from the dust and traffic of the main road, and nearer the township.

Mr Kelly offers 3/4 of an acre - provided that a room "for the accommodation of eighty children" is decided on. I believe a room for 60 would be sufficient and trust Mr K will give way that far.

I enclose map with site suggested marked with red pencil."

On 12 October 1880 the Inspector General of Schools forwarded the file to the Secretary to the Minister with the Inspector's report. The Inspector General's note relevantly reads:

"The second site (red) is preferable. A school for 80 would be too large."

On 13 October 1880 The Minister's secretary then made the following note on the file: "Please inform Mr Kelly of the choices of site size of school and ask that the deeds may be sent to Mr Andrews Q.C. for transfer of the land."

The file then shows that the file was forwarded to Mr Andrews QC as Solicitor for Education who completed the transaction.

The conveyance from Mr Kelly to the Minister was by the abovementioned indenture dated 1 March 1881, which is in evidence before me. The transaction (dealt with under the 'old system') was memorialised, and following an application made in 1990 to bring the land under the Real Property Act, the abovementioned certificate of title was issued in 1993 pursuant to the RealProperty Act.

The conveyance dated 1 March 1881 recited that "in consideration of the sum of five shillings paid by the said Minister to the said Robert Symons Kelly receipt whereof is hereby acknowledged and for other good causes and considerations him thereunto moving the said Robert Symons Kelly doth by these presents grant and convey unto the said Minister ... the lands".

Before the transaction was completed there was apparently an incident reported by Mr Andrews QC to the Minister's Secretary in a memorandum dated 17 December 1880 as follows:

"I sent the deed of the above School to Mr Kelly for his execution but he returned same to me unexecuted - He is under the impression that the Department are thinking about building the School on another site and not on his land. He therefore does not wish to convey the land to the Hon the Minister and afterwards to have it reconveyed - If he be advised that such is not the case I have no doubt he will convey at once."

The Parliamentary papers incorporating the Report of the Minister controlling Education for the year ended 31 December 1881 show that a government contract was let for the Modbury school building to accommodate 50 pupils with a completion date of 7 November 1881 at a contract price of [sterling]887.10.0. It is apparent that Mr Kelly's expectations as regards the establishment of a school were satisfied.

The evidence shows that the Modbury Primary School operated on the land now in question from 1881 until 1962. The site then became too small for the then needs of the community and a new primary school was built nearby. More recently the land in question has been leased to the City of Tea Tree Gully and used as a community library. From 1976 until 1991 the property was used as a College of Technical and Further Education. The property is now unoccupied.

Counsel for the Attorney General drew my attention to local history books. Counsel did not rely upon the historical material - nor do I. Although there is a belief amongst the historians that Mr Kelly donated the land for school purposes the evidence as to the circumstances of the transaction falls short of establishing a trust. However, it is understandable that in the light of the material to which I have referred the Attorney General has brought the matter before the Court

In City of Burnside v Attorney General (1993) 61 SASR 107 at 124 Legoe J reviewed the principles relating to the admissibility of secondary evidence as to the terms of a trust and the standard of proof which should be required in the case of a trust for a public purpose; in the same case at 146 Duggan J also reviewed the authorities.

I am prepared to act upon the material disclosed in the Government docket and the evidence to be extracted from the Parliamentary papers.

There is no rule of law or equity to prevent the imposition of ordinary trust obligations upon the Minister for Education as representative of the Crown where land has been provided by a private individual upon the footing of an undertaking to apply the property for a designated purpose. (see Registrar of Accident Compensation Tribunal v Federal Commissioner of Taxation (1993) 178 CLR 145 at 163). However, in the case which I have cited a distinction is drawn between a "true trust" and a "political trust". In the absence of clear words establishing a true trust according to ordinary principles, the obligation in circumstances such as the present may be characterised as a "political trust" or a trust of governmental obligation.

In Kinloch v Secretary of State for India (1882) 7 App Cas 619 at 625-626 Lord Selborne LC said:

"Now the words "in trust for" are quite consistent with, and indeed are the proper manner of expressing, every species of trust - a trust not only as regards those matters which are the proper subjects for an equitable jurisdiction to administer, but as respects higher matters, such as might take place between the Crown and public officers discharging, under the directions of the Crown, duties or functions belonging to the prerogative and to the authority of the Crown. In the lower sense they are matters within the jurisdiction of, and to be administered by, the ordinary Courts of Equity; in the higher sense they are not."

I find that the evidence is insufficient to support the existence of a trust (in the lower sense referred to by Lord Selborne) so as to bring its administration within the jurisdiction of the Court.

Any obligation created by Mr Kelly's actions was no more than a governmental obligation which would not be enforceable in a Court of law. My conclusion is that the Minister is free to dispose of the land in question and to apply the proceeds generally for the purposes of the Crown. It will be for the Minister to consider whether in view of the history of the land the proceeds of sale should be applied in a specific fashion. I refrain from further comment lest I appear to impose a fetter where none in law exists.

There will be a declaration accordingly.