§ Order for Second Reading read.
§ MR. GOULBURN
said, there were several points in the Bill which deserved serious consideration, and he thought he could not do better than state the objections he entertained to it now on the second reading, in the hope that they would be duly considered by the Government before it went into Committee. It was extremely important that the object professed by the Bill should be achieved—the better and more economical administration of charitable funds. Every one knew that those at present invested with the management of these funds found great difficulty in providing fresh trustees without incurring great expense, and, in some instances, of giving due effect to the wishes and intentions of the donors. But this Bill would not effect what its title professed to have in view. It applied only to a particular class of charities, those under 100l. a year in value; and it provided two new tribunals—one a separate Master in Chancery for 119 those charities above 30l. and under 100l., and another tribunal for those under 30l. At present no property under 100l. could go into the Court of Chancery without the certainty of being devoured. The Bill proceeded altogether on a wrong principle, for charities above 100l. had the same right to be economically and properly administered as those under 100l. This was nothing but a device for avoiding that reformation of the Court of Chancery in its administration of charities for which all the world had been long crying out, and the necessity of which was every day more impressed upon the public. No Government could undertake a more popular task than that of endeavouring to make the Court of Chancery what it was intended to be—the means of administering justice with regard to charities, available for all, however small in amount. If the hon. and learned Solicitor General would give his attention to such an alteration of the Court of Chancery, he would be doing a great public service; but if he persevered with this Bill as it stood, the effect would only be to hide from the public the deformities and the expense of that particular court, and to prevent any adequate reformation of it in its administration of charities; while in the meantime the charities of small amount would be remitted to a tribunal which he thought would be utterly incompetent to manage them. Some persons thought charities of small amount were of minor importance; but they involved principles of property as sacred as charities of the largest amount; and though not operating so extensively on particular classes of individuals, they still materially influenced the happiness and comfort of those within their range in their respective localities. It was not the amount, but the object to which a charity was directed, that ought to be looked at: efforts should be made to secure the donor's intentions, and prevent those abuses which had arisen more from want of an adequate tribunal for their redress, than from any fault of those who administered them. The number of small charities with which the Bill dealt was enormous; there were 4,600 of an educational character alone, which were directed to most beneficial purposes, and of which the due application should be ensured. The Bill proposed to transfer to the judge of the county court the right of dealing with the charities under 30l. per annum; all questions as to the appropriation of the charity, and the appointment of the trus- 120 tees were to be submitted to him; he was to have the power of laying down new schemes for the administration of the charities, in conformity with what he considered the intentions of the founders. This was a very extensive power; it had hitherto been vested entirely in the Lord Chancellor, who, from his eminent position, always in the view of the public, having great responsibility attached to him, and acting always in the presence of a learned bar, who were ready to criticise, approve, or censure his conduct, had every motive for acting on just and uniform principles in the administration of these funds. But the power was to be transferred to an officer of a very different description—a county court judge, sitting in a provincial town, with no bar of any importance before him—the affairs he managed only known to a few persons resident in the immediate neighbourhood—who was not sufficiently high in his profession to be above the suspicion which always would attach to his decisions, of proceeding in some degree from political or other feelings—who, generally speaking, had to deal with questions of common law, and was very little conversant with the rules of equity. Another evil was this. At present there was a uniform tenor of decisions; but they were about to commit these questions to perhaps sixty jndges, each deciding in his separate jurisdiction on points of equity with which he was not particularly conversant, forming precedents for himself in each particular case, and running the risk, if not incurring the certainty, of giving decisions on most important points, which would involve the whole administration of these trusts in difficulty and disorder, not merely for the moment, but for all time to come. The greater number of these small charities had been left by clergymen, or members of the Established Church, for the education of the poor; and they had been so applied as to give the poor of these several parishes a good and religious education, though in many cases the testator might not have particularly specified that a religious education was to be given, such being presumed to be his intention from his own profession. The funds in these cases had been applied in aid either of the parochial schools or those of the National School Society. Now there was an impression in some parties that secular education only was necessary; and he would ask the House, was it safe to leave to such an officer as he had described, on the applica- 121 tion of any dissatisfied person in the parish, representing that there was no specific provision in the will of the founder that a religious education should be given to the people—himself, perhaps, imbued with these novel principles—the power of deciding, should he so take it into his head, that an exclusively secular education was the only one to which the trust property was applicable? This would open an infinite source of litigation and division. He might be told that there was an appeal from the decision of the county judge to the Lord Chancellor; but the party appealing must do so at his own expense, and where was the benevolent person to be found who would incur the expense of litigation in Chancery to recover 10l. improperly withdrawn from a school? The true remedy was in the purification of the Court of Chancery, and in rendering it less dilatory and expensive; not in raising up tribunals, the only remedy for whose unjust decisions would be surrounded with all the expense, vexation, and delay which now attended questions of the administration of charity in the first instance. On these grounds he thought the Bill required serious consideration on the part of Government. It would be far wiser to undertake such a revision of the proceedings in Chancery as should give to all charities, great or small, the advantage of a proper administration, than to endeavour to bolster up what was in itself a bad system, by attempting a remedy for a portion of the evil, which would be no remedy at all, but which, though it might save some expense and litigation in the first instance, would tend to produce great dissatisfaction and injustice.
§ MR. TURNER
complained that the Bill had been generally put into the paper at an unreasonable time. In objecting to its being proceeded with after midnight, he had been actuated solely by a sense of the importance of the measure. It affected mainly the interests of the poorer classes, and threw a great responsibility on the House in selecting a tribunal for the proper administration of these charities. He regretted that such administration had often been tainted with political feeling. He was most desirous of hearing the suggestions of Gentlemen conversant with the working of charities in their respective neighbourhoods. The Bill dealt with all small charities under 100l., the number of which was about 24,000, and their income was not less than a million a year. There 122 were also between 3,000 and 4,000 charities under 30l. a year, whose aggregate income was between 200,000l. and 300,000l. Their objects were very various; some were for the maintenance of churches, others of highways, others of the poor, and others for educational purposes. The descriptions of trustees were almost as various—nominated, elected, ex officio, and other kinds. In dealing with funds so large, and applicable to such a variety of purposes, it was most important to select a tribunal which would ensure their being fairly and properly administered. The first object was to take care that proper persons were selected as trustees; the next to meddle as little as possible with the discretion of those trustees so long as it was properly exercised; next, to provide a very speedy and efficient remedy in the event of any abuse of the trust; and, lastly, to take care that no groundless or vexatious suit on the subject of these charities or their administration should be incurred. No person who was unacquainted with the course of proceeding in the Court of Chancery could conceive the mischief that arose from allowing parties to come into court upon any complaint which they thought proper to prefer. As an illustration of that he might mention that when the report of the commissioners, who had been appointed some years ago to inquire into all the charities of the kingdom, had been published, and no provision had been made to prohibit any others than the Attorney General to institute proceedings for the purpose of remedying abuses in those charities which required to be remedied, a particular attorney in the neighbourhood of that House filed informations against the different charities in the city of London, and against a vast number of other charities, at the relation of some person nominally interested; and to his knowledge the funds of many of these charities had been completely wasted in the litigation which ensued, in consequence of the want of sufficient control with respect to suits to be instituted for the remedy of abuses in charities. Now, on looking to see if the provisions of the Bill provided any adequate protection against such an evil, he found that any person might sue who had the sanction of his hon. and learned Friend the Attorney General, or of the magistrates in petty session assembled. If his hon. and learned Friend could devote sufficient time and care, consistently with the other duties he had to perform, to this matter, he should be quite satisfied to leave that discretion in his hands. But he knew 123 that it would be impossible for his hon. and learned Friend to devote sufficient attention to the subject, and without casting the slightest imputation on his hon. and learned Friend, he was acquainted with many cases where information had been filed in the name of his hon. and learned Friend, whose sanction was required pro formâ, without its being possible for him to give due consideration to the subject. No protection, therefore, which could be of any avail to these charities was thrown round them by the sanction of his hon. and learned Friend. Then, the sanction of two magistrates would be sufficient. Let the House only conceive what the effect of this must be in the different towns throughout the country. Nothing would be more easy than for a party to obtain the sanction of two magistrates in those places where a spirit of strife or party feeling existed, to file informations against a charity, and to exhaust its funds by making it the subject of appeal to the Court of Chancery. The Bill was objectionable in that respect. But it was objectionable likewise in many other respects. By the provisions of these Bills all charities between 30l. and 100l. were to be referred at once to the jurisdiction of a Master in Chancery, finally, and without appeal. Now, he would admit that the office of Master in Chancery was never better filled than it was at the present time; but, nevertheless, he had no hesitation in saying that it was a general practice for the parties who were litigating any case to appeal from their decision to that of the superior court. He therefore asked at the hands of the House that the right of appeal from the decision of the Master should be allowed in the case of these charities. He should not perhaps object to the Masters in Chancery being invested with the power of appointing the trustees. But this Bill proposed to give them the power of removing trustees. This would necessarily bring into the office of the Masters questions as to the conduct and character of parties, which ought to be reserved for the judgment of the higher court. With respect to charities under 30l., the Bill proposed to place them under the jurisdiction of the county courts. To that he entertained the strongest objection, because although he wished to speak with great respect of the judges of these courts, they were not generally acquainted with the mode of administering charities, or with the principles which regulated their administration. If they were resident in 124 their different localities, and were personally acquainted with those who administered the charities, he might not entertain so strong an objection to these charities being placed under their jurisdiction. But, generally speaking, they were not local residents, they possessed no local knowledge of the persons who administered the charities. On whom, then, would the administration and control of them fall, and from whom would the judges derive their information? From their clerks. And who, generally speaking, were these clerks? They were in too many instances solicitors practising in the towns where these charities existed. They were, therefore, connected with all the local politics of the place, and had a share in every election which took place: was it right that the control of these charities should be vested in such hands? These were evils which he thought sufficient to prevent the administration of charities from being placed in the hands of the county courts; but there was another and a greater objection which he thought would be decisive on the question. Suppose the case of the appointment of a trustee, and the judge having to decide between two candidates of different politics. In order to avoid the least suspicion of partiality, he might appoint the person who was of different politics from himself, although he might not be so well fitted to discharge the trust, or he would appoint the person of the same politics as himself, and then it would be said of this judge, in whom it was of importance that the poor should have the greatest confidence, that he worked the charities for local politics, and as a political engine. But the evil did not stop at charities under 30l. a year, for power was given to the Lord Chancellor to send charities of a higher amount to the county court, for the purpose of inquiry and administration. Under this provision of the Bill, even Rugby, Harrow, or Eton, would come within the power of the county court. It was not right to incur even the danger of that. He did not deny that some legislation was necessary on this subject. But this Bill was defective as well as faulty. It made no provision to enable charitable trustees to pass their accounts, which was a most desirable object to attain. It introduced confusion with respect to municipal charities under 30l., which were under the jurisdiction of trustees appointed by the Lord Chancellor. But this Bill places other charities of the same amount which 125 might be and were connected and administered together with municipal charities, under a different jurisdiction. Again, this Bill contained no provision to remedy the evil of requiring leases to be executed by all the trustees. He was of opinion that the objects contemplated by this measure would be effected more cheaply, and he was sure more safely and more equitably, and certainly more beneficially, through the medium of a Judge of the Court of Chancery sitting in chambers, than through the medium of the county courts or the Masters of the Court of Chancery. If the House did not approve of a Judge sitting in chambers, he thought that the commissioners of bankruptcy throughout the country, who were locally resident and were acquainted with the practice of equity courts, could more appropriately take cognisance of these charities than the judges of the county courts. He trusted that the House would prevent the administration of charities under 30l. a year by county courts, and that it would generally repudiate the principle of the administration of charities by these tribunals. He hoped the House would rather confer that jurisdiction upon a Chancery Judge in chambers, and it was his intention shortly to introduce to the consideration of the House a measure constituting such a tribunal.
The SOLICITOR GENERAL
would acquit the hon. and learned Gentleman who had just sat down of any unreasonable opposition to this Bill; but it should be remembered, that it had been estimated that the aggregate amount of the charities under 30l. was about 300,000l.; and under the existing state of the law, in every one of these cases, a breach of trust might be committed without the possibility of redress, redress being too expensive for any person to attempt to proceed. All would, therefore, admit, that it was highly important to provide a remedy for such a state of things. He was not disposed to dispute that if the Court of Chancery were reformed as he could wish it to be, it might deal with all these cases as cheaply as the tribunals proposed by this Bill; but, he asked, how near were they to such a reform in the Court of Chancery? The first steps now in progress for that end, both in England and in Ireland, were only in the nature of experiments; and although he had no doubt of their ultimate success, yet what were they to do with these charities in the interval? And if they were referred, in the meantime, to the jurisdiction pro- 126 posed by this Bill, there would be no reason why, when the Court of Chancery had been effectually reformed, they should not be transferred there, if it was considered advisable. The hon. and learned Gentleman objected to the proceedings before the Masters in Chancery, because there was no appeal; but if he referred to the 3rd clause, he would find that there was an appeal in cases where the Master makes a special report, or makes an order subject to the opinion of the Court. This enabled the Masters to allow appeals, if in their discretion they believed it necessary; and it was generally found that they were most ready to have their opinions corrected by the superior courts. It should be observed that great expense was occasioned by protracted litigation, and in the case of a charity of only 100l., one year's income, and probably more, would be entirely absorbed by the costs of an appeal, and the benefits to the poor recipients would be stopped. He, therefore, thought the right of appeal ought to be limited in extent. His hon. and learned Friend said it was important to give no encouragement to groundless complaints. Now, it had been a matter of course until of late years, that any person might file an information, himself being liable to the costs; and it was only within the last fifteen or sixteen years that the practice had been otherwise. This Bill sought to remedy this; for the 31st section provided that every application should have either the consent of the Attorney General or of two justices of the peace acting in petty session in the jurisdiction within which the charity was applied; and surely those justices of the peace might be safely trusted to allow a person to apply for redress regarding a charity of which it must be supposed they would have a local knowledge, and respecting which they must be presumed to be as free from party bias as they were in the discharge of their other duties. As regarded the passing of accounts, he supposed that meant a tribunal to audit the expenditure. Now, that was an expensive proceeding, and a great object of this Bill was to keep down expense as much as possible. But the Bill made special provision for the keeping and publication of accounts; and if any person thought he detected anything improper in them, he could apply to the magistrates for permission to seek for redress. With regard to the objections to the judges of the county courts, the argument about the diversity of decisions was 127 equally applicable to the county courts, as they now existed, and yet the country was strongly in favour of them. But here the evil would be less, because an appeal, under certain restrictions, would be allowed as to these charities, whereas no appeal at all was at present allowed in the county courts; and this provision would have the effect of regulating the law and practice of the courts; and he thought the judges would have sufficient acquaintance with the subject to enable them to deal with the cases that would come before them. There was no magic in them, and they would not have to deal with cases of title except in some particular instances. County court judges were not exclusively taken from the common law bar; he could name five or six gentlemen of considerable experience, from his own knowledge, who had been chosen from the Chancery bar; and that circumstance would be as strong a reason for objecting that they were not sufficiently acquainted with common law, yet he had not heard of such a complaint in any county court. Believing, as he did, that no individual could efficiently administer any branch of common law or equity without an acquaintance with the principles and even the details, to some extent, of the practice of all the other branches, he thought it exceedingly desirable that a knowledge of the whole should be united in the same individual, instead of being subdivided to such an extent as many seemed to prefer. With respect to the argument regarding the political bias likely to arise in the minds of county court judges, he confessed that he did not feel much of the strength of his hon. and learned Friend's observations. He did not believe it possible in human nature to remove all political bias from a Judge; and he believed the fear of being swayed by such an influence oftentimes made many Judges decide contrary to the truth of the case. But what did his hon. and learned Friend suggest? The county court judges were not locally resident in their several jurisdictions; but his hon and learned Friend proposed to transfer the duty to the Commissioners of Bankruptcy, who were generally locally resident in their different jurisdictions; and he ventured to say that political party and local bias was much stronger in persons always resident in the same place, than in those who only went there from time to time. And, in fact, this was the reason for changing the circuit of the Welsh Judges, and not continuing them always on the same juris- 128 diction. He believed, therefore, that his learned Friend's suggestions were very unadvisable in this respect. But he also suggested that an Equity Judge should try these cases in chambers. Now it would not be possible to do this in charities under 30l., because it would be too expensive. But why not apply the same principle to the Masters in Chancery; for it would really amount to the same thing, except in the name of the Judge—it would merely he a Master in chambers instead of a Judge in chambers; and he would venture to say—and he believed his hon. and learned Friend would agree with him—that many of the Masters of the Court of Chancery at this moment were as competent to deal with these cases as the Judges themselves. Therefore, in reality, his hon. and learned Friend's suggestions, instead, of being opposed to, turned out to be confirmatory of, the provisions of this Bill. He (the Solicitor General) was desirous to avoid trespassing upon the time of the House, but there was one observation he should make with respect to what the right hon. Gentleman the Member for Cambridge University had stated in reference to those charities that were given for educational purposes. In administering the charitable trusts, the judges appointed to administer them would find charitable trusts belonging to every denomination of persons—of members of the Church of England—of Dissenters and other persons; and in all those cases to which the right hon. Gentleman referred, where from the fact of the donor being a member of the Church of England, or from the fact of the trusts being administered by a member of the Church of England it was necessarily to be inferred that the intention of the founder was, that the fund should be devoted to the instruction of persons professing the doctrines of the Church of England, it would be a breach of the trusts to apply them to any other purposes. The same principle had governed the decision in the case of Lady Hewley's charity; and by that principle the judges of the county courts would be bound. He did not mean to say that there was not in the Bill a great number of matters to be improved, and was perfectly aware of the difficulties of the subject; but the general principle of the measure was to afford a speedy and cheap remedy for the administration of those charities. He did not expect any opposition to the second reading of the Bill, though he anticipated in Committee 129 a great deal of discussion on some of the clauses, and many suggestions respecting them. Those suggestions would receive consideration, and he promised to give his best attention to the subject.
§ MR. ROUNDELL PALMER
said, it struck him that the main difficulty in the way of this and many other reforms which might be suggested in the administration of justice, arose not by any means from that part of the subject which occasioned the principal necessity for legislation. There was an important practical distinclion between the administrative and contentious jurisdiction of the court in this class of subjects; and the great practical necessity for legislation, he would venture to say, had reference not so much to cases of supposed or actual breach of trust in small charities as to the very numerous instances of their administrative wants, which, in the present very imperfect state of the law, could not be supplied without the Court of Chancery. Take, for example, the appointment of new trustees—the most simple, and often the most necessary, thing in the world. One would suppose that there would be an equally simple, straightforward, and obvious way of doing it; but no, the only mode was by the costly machinery of a petition to the Court of Chancery, reference to the Master, a return to the Court to be confirmed, and, possibly, further questions arising out of the subject. Again, the taking and publication of accounts was an important matter; so, also, was the power of re-leasing when the estates of a charity required to be let; and the case where the funds of a small charity had so increased that it would be possible to extend the basis of the foundation consistently with the wishes of the founder. All these were administrative objects, and it was for the sake of those objects that the intervention of the Legislature was necessary. All that, however, might be supplied by the present Bill without entangling themselves in any of the difficulties which arose immediately they attempted to apply the same mode of summary jurisdiction in those difficult contentious cases which would arise in small charities as well as great. It was, he thought, worthy of consideration whether it would not be better, in the first instance, to pass a Bill which should provide a cheap, simple, and effectual mode of supplying the ordinary administrative wants of charities, whilst they reserved the consideration of that contentious part of the 130 jurisdiction until they should be able to deal with the general subject of Chancery reform, in connection with which it really required very much to be considered. Another point of first-rate importance, on which, as it appeared to him, this Bill was open to grave exception, was that of appeal. It seemed to him that the House should pause before it extended the principle of giving judges, who were to be appealed from, the right of determining whether or not an appeal should lie from their decision. With respect to the Masters in Chancery, they were known so well, and they had before them so many examples and so large a course of sound and just administration, that he could not doubt but that, as a matter of course, they would allow an appeal in every case whenever it was asked; but that principle was now proposed to be extended still further with respect to the judges of the county courts, and they gave to those judges the power of removing the most respectable persons in the neighbourhood—the clergy of the parish, county magistrates, and gentlemen of that standing—from the office of trustees, and of refusing to give them an appeal; and further, if they allowed an appeal, it was proposed that the case should go to the court above from the local judge upon his statement of the facts of the case, as he had derived them from the evidence. He quite admitted, that of all the reforms which had been introduced into the country for many years past there was none for which they had more reason to thank the Government than the establishment of the county courts; and feeling that, he was not disposed to refuse to those judges, as a class, that confidence which he thought ought to be placed in the judicial institutions of the country generally; but when the question arose of referring these matters either to the county court judges or the Commissioners in Bankruptcy, he must observe, that the Commissioners in Bankruptcy had, for the most part rather greater acquaintance with equitable principles than could usually be expected from the previous practice of the county court judges; and that the questions arising out of the contentious jurisdiction in charities would be of a different class from those which were now referred by the law to the county court judges; and, therefore, it by no means followed that those gentlemen would acquire, in the ordinary exercise of their present jurisdiction, those habits which 131 were at all applicable to this class of subjects. The jurisdiction was also far greater in point of amount than was entrusted to the county court judges for any other purpose; for 30l. a year was equivalent to no less than 750l. at twenty-five years' purchase; and the Government which introduced this Bill was now objecting to any extension of the county court jurisdiction, even in common cases of debt, beyond its present limit of 20l. These were, in his opinion, important reasons for endeavouring to place the jurisdiction, in cases of charities under 30l. a year, in the hands of the Commissioners in Bankruptcy.
§ MR. AGLIONBY
said, it was, of course, exceedingly natural for hon. and learned Gentlemen belonging to the Chancery bar to feel great reverence for the court in which they practised; but the country did not like that court; and the great advantage of this Bill was, that it sheared that court of a considerable portion of its practice, and vested it in a body in which the public felt more confidence. He had received, from districts in which small charities were administered, communications in favour of the passing of a Bill which would relieve parties from the caprice and delay of the Court of Chancery. Bad as was the practice of the Court itself, that of the Master's Office was worse—even the place and the manner of administering justice were anything but calculated to inspire the public with confidence. He believed there was no greater evil than appeals, and that there was nothing which was viewed with greater impatience by the country than the delay and expense occasioned by this system of appeal. He could not agree with those eminent and learned men who had already spoken. He thought the change was a great advantage, and he thanked the hon. and learned Solicitor General for having carried out this work.
§ Bill read 2°, and committed for Monday next.
§ The House adjourned at a quarter before Twelve o'clock.