LAW OF MORTMAIN.

HC Deb 16 March 1854 vol 131 cc859-72

MR. HEADLAM

, in moving for leave to introduce a Bill to amend the Law of Mortmain, said, he rose for the purpose of submitting to the House a measure of considerable importance. He was about to ask the House to consider the whole law affecting the disposition of property for charitable and religious purposes—laws under which it was right to state in the first instance many institutions in this country had been established, in which they took great pride, and which were founded by the munificence of their ancestors, and laws, which, on the other hand, it was equally right to say by which great injustice had been done, a great amount of litigation had been caused, and a great amount of property had been taken from those who had a moral claim to its possession, and applied to purposes of questionable utility. He was going to ask the House to repeal the existing law on this subject, and enact, in its place, provisions more suitable to present circumstances, more effectual for the prevention of the particular abuses against which the law was originally intended to operate, but at the same time much less obstructive and inconvenient in cases of well-considered charitable bequests. He wished in the I outset to state that his was as much an enabling as a restraining statute, for, while the existing law had in many instances failed to meet the purposes for which it was intended, it gave rise to evils of a magnitude which could be scarcely exaggerated. He was aware that some apology was due from himself, as an independent Member, for venturing to bring forward a measure on so extensive a subject, but the House would recollect that in the course of the last Parliament a Select Committee on the whole matter was appointed, of which he had the honour to be Chairman, and which, after an investiga- tion that lasted two Sessions, made a Report to the House; and that, at the time he moved for the Committee, he pledged himself to bring forward a measure. Having considered that the best mode of procuring practical legislation on the subject would be to urge it on the attention of the Government, he applied to two successive Administrations, and it was not until he received an intimation that the Government did not intend to introduce a measure on the subject that, in the fulfilment of the pledge ho had given, he thought it necessary to come forward with the present measure. The first law on the subject of mortmain contained in the Statute-book was to be found in Magna Charta, although the history of the Mortmain Law went back further even than that. It was rarely they had to refer to so ancient a Statute, but he would read the provision on the subject:— It shall not be lawful from henceforth to any to give his lands to any religious house, and to take the same land again to hold of the same house. Nor shall it be lawful to any houses of religion to take the lands of any, and to leave the same to him of whom they received it. If any from henceforth give his lands to any religious house, and thereupon be convict, the gift shall be utterly void, and the land shall accrue to the lord of the fee. That was not really the commencement of the law on the subject, for by the principles of the common law it was prohibited to give lands to religious houses; the Statute of Magna Charta was one of a series of Statutes, enacted for the purpose of preventing an evasion from time to time of the provisions of the common law, and he could not better explain the general nature of those Statutes than by reading an extract from Blackstone's Commentaries on the subject:— In deducing the history of which Statutes it will be matter of curiosity to observe the great address and subtle contrivance of the ecclesiastics in eluding from time to time the laws in being, or the zeal with which successive Parliaments have pursued them through all their finesses; how new remedies were still the parents of new evasions; till the Legislature at last, though with difficulty, hath obtained a decisive victory. It was perfectly true that new remedies were still the parents of new evasions, but he differed from Blackstone when he said the Legislature had obtained a decisive victory. It was singular that almost all the curious technicalities which existed in the law seemed to originate from these sources; for, when land was prohibited to be given to charities, long terms, such as terms for 1,000 years, were invented by way of evading the Statute. The 7th of Edward I. was enacted to meet this evasion. Then they had heard, probably, of what were termed fines and recoveries, which were proceedings technically existing in the law till within the last twenty years. They were also used for the purpose of evading the law of mortmain, and the 13th of Edward I. was enacted to prevent that mode of evasion. Then there were uses and trusts which were applied to modern conveyancing, but which were introduced also for the purposes of evasion, and the 15th of Richard II. was passed to put a stop to that mode of evasion. In the time of Henry VIII. a great proportion of the land was devoted to purposes of this description, and it was not the force of law, but the tenacious grasp of that Monarch, which took this property from the purposes to which it was applied, and devoted it to purposes which were perhaps more useful. The general result of all these Acts was that no land could be given to a corporation, and held by that corporation, unless there was a licence from the Crown, or a provision contained in the Act of Parliament under which the corporation was established. He did not wish in any way to interfere with that provision, but there was one evil arising from it, that trading corporations in modern times had doubts whether they could advance money on real security—on mortgage, for instance, or railway debentures. But, assuming that they could do so, and that they availed themselves of the security, to foreclose the land, and become absolute possessors of it, they then subjected themselves to danger of forfeiture to the Crown. And they had evidence before them in the Committee of cases of this kind. He proposed in reference to this part of the subject that these corporations should be at liberty to avail themselves of these securities, subject only to a provision that they should sell the property in five years after they became entitled to it, because there were serious objections to large quantities of land becoming the property of these corporations. He might mention that the history of the law of mortmain, so far from being, as some might imagine, a dry and uninteresting one, was one really full of information, replete with instruction with regard to things of which men in the history of this country were earnestly striving for conquest. They found this exemplified in the cases that came before the courts of law, in the tendency at different periods of public opinion on the subject, and in the manner in which the judges, from time to time, gave their decisions in reference to this question as cases came before them. The first of these periods was that which occurred before the time of the Reformation, from the time of Magna Charta to the time of Elizabeth. The second period, during which a totally different policy prevailed, was from the time of the Reformation to the 9th George II., when enactments were passed on the subject which were now existing. The third period was from the 9th George II. to the present time. He had stated the law during the first period. During the second period a totally different policy seemed to have prevailed in the Legislature, and also in society. There were two Statutes which enabled persons to evade completely the series of statutes to which he had called the attention of the House. One of those statutes was termed the Statute of Uses, and the other was an enactment which enabled a man to devise his lands for charitable purposes. And not only were there no cheeks or restraints upon this practice by the principles of the courts of law, but a contrary principle prevailed, and, by a statute enacted at the beginning of the reign of Elizabeth, great latitude and encouragement was given to devises of this description. At that time, also, it happened that the somewhat stern and cold rules of political economy were not known as well as at the present day. This continued till the reign of George II., when the evils had increased to a considerable extent. Before, however, he came to the third period, he should state that the courts of law, by their decisions, favoured gifts to charities; for instance, it sometimes happened that a particular individual had a power of appointment over funds; that was to say, he could dispose of funds provided he went through certain formalities. Well, the courts of equity held that if these formalities were not carried out that did not vitiate a gift to a charity, but it did with respect to an individual. A case came within his own knowledge in which a lady had a power of appointment, which she executed partly in favour of a charity and partly in favour of relations. The appointment was not duly executed, but the Court held that under the same instrument the charitable devise was good, but the devise to the individuals was bad. This decision was doubly hard, because, if there had been no execution of the power of appointment, these same relatives would have taken the property absolutely, so that if the Court had held the appointment absolutely good or absolutely bad they would, at all events, have taken a portion, but as it was they took nothing. He proposed that the same rule of construction should apply to the cases of charities as to the cases of individuals. He now came to the third period, which was the one with which they had practically to deal. In the commencement of the reign of George II. one of the greatest lawyers of this country, and one whose reputation, perhaps, stood highest in the Court of Chancery—he meant Lord Hardwicke—took this matter in hand, and under his auspices a Statute was passed, the preamble of which, as it fully explained the object of the measure, he would read. It was— Whereas gifts or alienations of lands, tenements, or hereditaments in mortmain are prohibited or restrained by Magna Charta, and divers other wholesome laws, as prejudicial to and against the common utility; nevertheless this public mischief has of late greatly increased by many large and improvident alienations or dispositions made by languishing or dying persons, or by other persons, to uses called charitable uses, to take place after their deaths, to the disherison of their lawful heirs. And very shortly after the passing of that statute a case came before his Lordship, in delivering judgment on which he took occasion to state in the clearest manner the object the Legislature had in view in passing that Act. In that judgment he said:— The reason of the Statute was to hinder gifts by dying persons out of a pretended or mistaken notion of religion, as thinking it might be for the benefit of their souls to give their lands to charities which they paid no regard to in their lives; and therefore the Act of Parliament has not absolutely prohibited the disposition of land to charitable uses, but left it to be done by deed executed a year before the death of the grantor, enrolled within six months, though this will not render them equally unalienable; but the Legislature blended the two inconveniences together—the acts of dying persons and the disherison of heirs. With respect to the policy of that Act he had nothing whatever to say; he believed it to be, perhaps, as wise a principle as any that could be discovered, and the Act which he was about to propose was based on that principle. The first great evil of this statute had been the enormous amount of litigation it had caused. By that Act, personal property was divided into two descriptions,—one, personal property having relation in any way to land—that was to say, money due upon mortgage, or railway debentures, or property in any way connected with real estate; the other description of personal property was that which had no connection with real estate. The law with regard to these two descriptions of personal property was totally different. For instance, they might give money lying at their bankers' without the slightest restriction, but they could not by will give money which was due upon mortgage. The courts of law held that the charity devise or the devise to individuals failed in proportion as the. personal estate was one of these descriptions or the other. Boundless litigation had been thereby caused. The books were full of cases on the subject. [The hon. and learned Gentleman then read an extract from the evidence of Mr. Pemberton Leigh on the subject before the Committee corroborative of his statement.] The great hardship of this state of the law was, that if a charity legacy was given they must have a Chancery, suit to administer the estate, and the expenses of that suit had to be paid not out of the charity legacy, but out of the residue of the estate of the testator, that portion which he had devoted to his own family, so that they had to pay not only the charity legacy, but the expenses of the suit in addition. This was an evil, and he hoped the House would assist him to redress it. The Committee to which he had alluded were unanimous in the conclusion that, whatever might be the law on this subject, there should be one law and one rule with respect to all descriptions of personal property. In this measure that principle was introduced. He would, however, state with regard to real estate what were the provisions now in force, and what were those which he proposed. The House, he thought, would agree with him that there was a considerable distinction between the gift of a piece of land for the purpose of a site of a building, for instance of a church or chapel, or a school, and the gift of a farm or estate for the purpose of that farm or estate being made a source of revenue to a charitable foundation. The gift of a site, he thought, was praiseworthy, but the gift of a piece of land for a permanent endowment, he thought, they should look upon with suspicion. The Legislature had acted on this principle, for there were several Acts of Parliament giving facilities for granting sites. There was a law which stated they should not grant land at all, except under certain restraints; and then they had a Statute that they might give land without restraint for schools. But he did not wish to confine the exceptions merely to schools. He should propose an exemption in favour of sites for all places of worship belonging to any sect or community; also sites of schools, libraries, museums, and all buildings of that description in the possession of public bodies devoted to literature, science, and the fine arts. He proposed that there should be no restriction of gifts of sites for these purposes, except that notice should be given to the Charity Commissioners, and also that there should be registration, in order that the matter might be formal. The next exemption he would make was with regard to bonâfide purchases of land. The evils that had arisen in respect of that were of a very serious nature, but the House would see that when land was bonâfide sold, when the owner received the full value for it, there was no reason why there should be a difficulty in the conveyance. He did not wish to give the slightest encouragement to the investment of money devoted to charity in land, hut, supposing such an investment were made, there was no reason why it should be subject to this technical restraint. Mr. Bunting, who was a solicitor in large practice in this department, in his evidence before the Committee, was asked— With regard to a bonâfide sale, is there any reason why such a provision should be in existence? And he said— Clearly there is no reason, and it works in practice exceedingly objectionably, particularly in the locality where I reside. It arises out of the peculiar tenure of land in the neighbourhood of Manchester. They are in the habit of reserving a rent-charge on land, and those rent-charges are inconsistent with the Act of George II. Well, now, with regard to the general principle of giving land to permanent charitable foundations, the law as it was at present was of this nature—they could not give land by will to any charity whatever; they could only give it by a deed executed a year before the death of the persons giving it, and the deed must be enrolled within six months of its execution. He, for one, was not prepared to make any additional concession to render it easier to give land for permanent charitable foundations. He would ask the House to consider what an enormous power was exercised by a man who gave land for purposes of this description. In the case of the gift of land to indivi- duals, the law imposed some restraint upon the degree of their control over it. The law did not allow a man to tic up an estate for ever; they did not allow him to accumulate it for more than twenty-one years, or to name an heir beyond a certain period. But that was not the rule with regard to a charity. There were hundreds of acres of land in this country, the produce of which was expended in obedience to the wishes—it may be the whims of caprice—of some individual who lived in the reign perhaps of Elizabeth. If the law enabled a man to say with regard to a particular acre of land to which he was entitled in this generation, that the produce of that particular acre should be applied in a certain way, so long as the sun and moon lasted—if they gave a power of that description, it was the duty of the Legislature to see that that power was not executed except in the most distinct and solemn form, and they should take care that it should not be executed at the moment of his death, in the hour of his weakness, when, judging from the past, it was quite possible he might be under some spiritual influence that had been exerted on his mind. He, therefore, trusted that the House would maintain this particular provision in the existing law upon the subject. He now came to personalty. As he had before stated, he thought it desirable that there should be one law applicable to all forms of personalty. There was, however, one exception which might be made, namely, specific gifts of books, pictures, and things of that kind, which he thought might be given to public institutions, such as the National Gallery, the British Museum, and establishments of that description. He now came to the question of what should be the general law with respect to all forms of personal estate, and, to use a Parliamentary phrase, he had three courses. He might forbid the giving of all personalty; and there were some Gentlemen on the Committee who advocated that view, but he thought that would be too stringent a provision. The second course would be to make the law the same as that which applied to the other descriptions of personal property, that was to say, that there should be no restraint whatever. He, for one, was not disposed to accede to that. He thought it was not desirable to introduce so grave a relaxation as that would be. What he proposed was a medium course between the two. He proposed that personal estate, of whatever nature, should be subjected to one law with respect to bequests, namely, that the will giving such estate must be executed three months before the death of the testator, and that within one month after its execution notice of the amount of any charitable gifts and of the purposes to which they are applied must be given to the Charity Commissioners. He did not propose, however, that the notice so given should be made public until after the testator's death; but he wished to have all such matters executed in as solemn and formal a manner as possible. It was not impossible that under this Bill some charitable bequests might fail, but it should be remembered that at present half the personal property in the kingdom could not be given for charitable purposes at all; and, therefore, he considered his proposal a fair compromise. The next matter to which he would allude was the necessity of some measure for curing the defects of titles, which had grown up under the present law. The House would be surprised to hear the extent to which these defective titles existed. Mr. Bunting, in his evidence, said:— I think I could, in five minutes, from my own knowledge of the cases, enumerate property to the extent of 200,000l. and 300,000l., the title to which is bad, except so far as it has been cured by Statute. The source of these defects in the cases referred to by Mr. Bunting, was the local custom he had already mentioned; and about twenty years ago it had been found necessary to pass an Act of Parliament or the subject. He (Mr. Headlam) now proposed by a general enactment to make valid all existing titles except where proceedings had been taken to impeach them; and he trusted that no retrospective measures of this kind would ever be required in future. There was another object which he sought in this Bill to attain, and that was to prevent what were called secret trusts; namely, cases where property was given to individuals for trusts, the nature of which was not disclosed. A very strong opinion had been expressed by the Committee against trusts of this description an opinion which was founded upon evidence equally strong; and, indeed, it was obvious that secret trusts must hold out great temptations to laxity and dishonesty and give rise to continual heartburning on the part of those who considered them selves deprived of property for purposes c which they were entirely ignorant. H should, therefore, propose to enact, that if any person accepted property upon any secret trust, and should omit to give notice to the Charitable Trusts Commissioners, he should be personally liable to refund all he rents and profits which he had applied to the purposes specified, and if no suit were instituted within a given time by the persons interested in the property, then he Attorney General should be at liberty to sue. He (Mr. Headlam) was quite willing to admit the impossibility of entirely weventing cases of this kind; but he thought the proposal he had made would materially check the practice, which was, perhaps, all the Legislature could hope to effect. Since the Act of George II., various exemptions from its operation were obtained by different parties; but he was strongly of opinion that there should be one general law based upon a sound principle, and that from such law no exemption should be allowed. In the reign of George II., a very earnest endeavour was made by the Universities to be excepted from the provisions of the Act, which was acceded to, and several other bodies had since obtained the same privilege. The Committee, however, had had the Vice Chancellor of Oxford before them, and that gentleman had stated his opinion that the University had not derived any material advantage by the concession. That statement appeared to be quite the fact, for there seemed to have been no gifts made to the University on account of its exemption from the Act. But although such exemptions were of such small practical value, their continuance did impart a certain degree of unfairness to the law; and he (Mr. Headlam) would provide against that by a clause to the effect that the exemptions which had been obtained from the operation of previous Acts should not be likewise admitted as exemptions from the provisions of this Bill, for having made general exemptions in the measure, he did not think it was advisable that any particular exemptions should be allowed. There was now only one other point remaining to be noticed. Dr. Wiseman had complained before the Committee of the operation of the Statute of Superstitious Uses. Now he (Mr. Headlam) did not think that there was any practical grievance in that Statute, inasmuch as the Act of the 2 & 3 William IV. placed the Roman Catholics on precisely the same footing as Protestant Dissenters. However, as the Statute of Edward VI. might possibly have practical operation notwithstanding the Relief Act—which he very much doubted—he should propose its formal repeal; such repeal, however, not to affect the legal definition of the word "charity," so that Roman Catholics, Dissenters, and members of the Church of England would then all stand upon precisely the same footing. He had now enumerated all the material provisions of the Bill he was proposing, and he had described the nature of the changes which he sought to introduce. When he first moved in this matter and asked the House to appoint a Select Committee on the subject, he stated that it was not his intention to make any difference between the different religions communities in this country; and he trusted that there was nothing in what he had said or proposed that could insult the feelings or even wound the prejudices of any religious body whatever. His Bill had been conceived in no illiberal spirit towards the charities of the country. We had many proofs of the greatness and wealth of this kingdom—many proofs of the power we exercised in the remotest parts of the world; but the proof that made the greatest impression of all upon his mind was the enormous sums that were annually contributed by individuals amongst us to charitable and religious purposes, and the zeal and energy that were displayed by so many persons in improving the condition of their fellow subjects, and in spreading the blessings of civilisation and religion to the farthest ends of the earth. He had no wish to freeze up the source of this munificence; for the alms which men gave in their lifetime—the rich from their superfluities, the men of moderate means from their necessities, and those in humbler circumstances from their poverty itself—conferred a benefit not only on the objects of their benevolence, but upon themselves. Of money so given the description of the poet was no less accurate than beautiful:— The quality of mercy is not strained; It droppeth as the gentle dew from Heaven Upon the place beneath: it is twice blessed, It blesseth him that gives and him that takes. But the same observation was scarcely accurate when applied to money given, not during the life of the donor, but at a time when it could hardly be called his own—given when he could exercise no self-denial in providing it, nor control its disposition. If anything, therefore, that he had said, or any provisions of the Bill he sought to introduce, should have the effect of changing charitable donations of this second class into those of the first, in inducing men to give in their lifetime rather than upon their deathbed, he, for his own part, should be completely satisfied with the result; and he should feel that his labour had not been in vain.

MR. HADFIELD

seconded the motion, and said the country had great reason to complain of the difficulties thrown in the way of promoting religious and charitable schemes. It could never have been the object of the Statute of Mortmain to place obstacles in the way of dispensaries, places of worship, or schools being erected. He could not help thinking that very serious mistakes had been made in the wording of that Act, and that it had been subjected frequently to the most erroneous constructions. It was a remarkable fact connected with the institution of Manchester of which its inhabitants had most reason to be proud—he meant the Manchester Infirmary—that for fifty years it was held upon a defective title; for it happened that the conveyance of the charity reserved some small rent to the grantor who had been the lord of the manor, and that reservation made the conveyance a bad one. Again, under the existing state of the law, copyhold property could not be passed for the purpose of charity, and the consequence of that was, that throughout a large district of the north of Lancashire, where scarcely any other species of property was to be heard of but copyhold, it was doubtful at this very day whether a school, or a dispensary, or even a literary institution, could be invested with property of a copyhold nature. An instance had occurred where a gentleman left as much as 60,000l. for the formation of two schools—one of them for the use of the blind; but he was debarred by the law from giving a single acre of land for the purpose, and the consequence was, the fulfilment of the objects of the charity was delayed for ten years, and then the schools were erected in a district removed from that in which the testator wished them to have been erected. He was quite sure that, whether the law was to be ameliorated through the exertions of the Government, or that of the hon. and learned Gentleman who had so ably propounded his scheme, the country would feel much indebted to whoever should prove the instrument of bringing about such an amendment.

THE ATTORNEY GENERAL

said, there was no objection whatever on the part of the Government to the introduction of the Bill. The subject was one of great importance, and he thought the time had come when the Law of Mortmain might well undergo revision. It was a subject to which his hon. and learned Friend (Mr. Headlam) had given great attention, and no person was more competent to deal with it. Without at all pledging the Government to the course they should take with regard to the Bill, when the opportunity for considering it should arrive, he would say that the subject introduced by his hon. and learned Friend was in every way worthy of consideration.

MR. BOWYER

must do justice to the fairness with which this Bill had been brought forward by the hon. and learned Gentleman; and he certainly wished that other measures affecting that portion of the community to which he belonged were brought forward in an equally fair and reasonable manner. He was quite sure that when measures were brought forward in that manner, the Catholics would be ready to discuss them in a candid way, and to place the merits of the case, so far as it affected them, before the House fully, fairly, and justly. It struck him that this Bill, and all matters like it, involved in reality an important principle. The real question was the power of disposal, and that was the question involved in all those measures. Those dispositions to charities were not the only dispositions they should guard from the effects of the law as it now stood. Let them suppose the case of a man with a large landed estate, and no children or relations at all. That man probably might have never done a charitable action or any public good in the course of his life; but when he was dying, and bethought himself of founding something useful, either religious or charitable, he could not do it—he was prevented. But suppose it was a man with a large family of children dependent upon him—that man had free liberty by law to will the whole of his property away to some worthless person, disinheriting his own children altogether. Therefore, the real question was whether a testator should be allowed to disinherit those for whom he was bound by nature and religion to provide? In other countries a person could not altogether disinherit his children, but must leave them a legitim legacy for their subsistence, and so it was according to the law of Scotland. As to the Roman Catholics, he could assure the House that they had no desire to be legislated for on any other principles but those which formed the basis of legislation with respect to the remainder of the country. But they said that they were now subject to exceptional laws, and the new legislation affecting them must be so framed as to prevent the action of those laws upon them in an unjust manner. He would reserve to himself the right to consider the means proposed by the hon. and learned Gentleman to deal with that subject, and whether they would really cure the defects arising from the old law. With regard to secret trusts, there would be no necessity on the part of the Roman Catholics for secret trusts if the present law were so altered as to place them and their charities and religious establishments on the same footing as those of the remainder of the country. He would reserve to himself the right to take hereafter what course he might think advisable.

Leave given.

Bill ordered to be brought in by Mr. Headlam and Mr. Hutt.