HL Deb 16 December 1952 vol 179 cc998-1001

3.2 p.m.

EARL JOWITT

My Lords, I beg to ask the Question which stands in my name on the Order Paper.

[The Question was as follows:

To ask Her Majesty's Government whether they will now make available the Report of the Committee of Inquiry into the Law and Practice relating to Charitable Trusts, and will state whether they accept its recommendations.]

THE LORD CHANCELLOR

My Lords, I am making available to your Lordships in the Printed Paper Office this afternoon the Report of the Committee, under Lord Nathan's chairmanship, which has been considering changes in the Law and Practice (except as regards taxation) relating to Charitable Trusts in England and Wales. The Government are grateful to Lord Nathan and to the other members of the Committee for having undertaken this heavy and complicated task. The Report as a whole is receiving the careful consideration of the Government, who will announce their decision upon the recommendations in due course. The Government have, however, given urgent consideration to one aspect of the Report concerning imperfect trust instruments dealt with in Chapter 12, which is ancillary to the general problem, and have decided to introduce legislation dealing with it as soon as possible. I propose to circulate in the OFFICIAL REPORT a statement of the purport of the proposed legislation.

Following is the statement referred to:

  1. 1. Subject to some minor differences which will appear in the later paragraphs of this statement, the Government accept in the main the proposals of the Committee set out in Chapter 12 of the Report for validating trust dispositions which authorise the application of property for both charitable and non-charitable purposes. They art not, however, satisfied that it is either right or necessary in the circumstances to make provision for the validation of trust dispositions for purposes which are wholly non-charitable.
  2. 999
  3. 2. The Government propose to introduce as soon as opportunity occurs a Bill, which, if Parliament approves, will make provision on the lines set out in the following paragraphs.
  4. 3. Broadly speaking, the Bill will validate dispositions of property which satisfy the following conditions:—
    1. (a) that the disposition was made before the 16th day of December, 1952;
    2. (b) that the disposition is in terms which authorise the application of the property for purposes that comprise both charitable and non-charitable objects;
    3. (c) that the disposition is invalid on grounds, such as remoteness or uncertainty, which would not invalidate it if its objects were wholly charitable; and
    4. (d) that the disposition has been treated as valid.
  5. 4. From the passing of the Bill, property comprised in a disposition within its ambit will be made applicable by the Bill itself for charitable purposes only, unless a claim adverse to the disposition is successfully asserted in accordance with paragraph 5. The particular charitable purposes for which the property will thus be rendered applicable will be the purposes specified in the disposition so far as they are charitable.
  6. 5. A person who apart from the Bill would have a right to recover property comprised in a disposition within the ambit of the Bill on the ground of the invalidity of the disposition will be left free to assert that right if—
    1. (a) at December 16, 1952, the disposition has been in operation for less than six years (that is to say, either was made within six years before that date or was subject down to that date, or to within six years before that date, to a prior interest which absorbed the whole of the income or profits of the property), and
    2. (b) any necessary action has already been begun or is begun at any time before the expiration of a year from the passing of the Bill.
    Subject as above, such rights will be extinguished by the Bill; except that provision will be made for any relaxation of the conditions mentioned at (a) and (b) which may be proper for safeguarding the position of persons who have been or are under disability or whose interests have been or are in reversion only.
  7. 6. Application before the passing of the Bill of property comprised in a disposition within the ambit of the Bill in accordance with the terms of the disposition will be treated as having been a proper application, and rights which would exist apart from the Bill either to render the persons by whom such application has been made personally liable on the ground of misapplication or to recover from any recipient of any of the trust property will be extinguished by the Bill, except in a case in which an action to assert such a right has been begun before December 16, 1952.
  8. 7. Forestalling of the proposed protective provisions by actions brought between December 16, 1952, and the passing of the Bill to assert rights falling within the classes of 1000 rights which the Bill is to extinguish will be met by provision for staying any such action at the passing of the Bill if it is then still pending or for restitution if it has been completed.
  9. 8. For the purposes of taxation, the effect of the Bill will be that dispositions falling within its ambit will become entitled to the normal relief available by statute to charitable bodies, but no right will be conferred to reclaim any payments of tax already made, whether by direct payment or by deduction of tax.

EARL JOWITT

My Lords, this is a difficult and complicated matter, and the noble and learned Lord will realise that it may be that we shall desire an opportunity for its full discussion. No doubt that can be arranged in due course through the usual channels.

THE LORD CHANCELLOR

Yes.

VISCOUNT SAMUEL

With regard to the noble and learned Earl's last observation, I have given notice that I propose to raise this question after the Recess, since I had the privilege of initiating this discussion in your Lordships' House two or three years ago.

LORD NATHAN

My Lords, with your indulgence and as chairman of the Charitable Trusts Committee, perhaps I may be allowed to say a few words on the statement which has just been made by the noble and learned Lord the Lord Chancellor. First, let me say that I am grateful to the noble and learned Lord for the expression of the thanks of Her Majesty's Government on the fulfilment of the task entrusted to my Committee, appointed in the first instance by Mr. Attlee, and, on the change of Government, invited by Mr. Churchill to continue. There has been no comprehensive review of the law and practice relating to charitable trusts since Lord Brougham's Committee was appointed in 1818 and made its full Report eighteen years later. Although my Committee has had to consider a vast amount of statutory and case law, and more general questions arising out of the changed economic and social conditions, I am glad to think that we have taken so much less time to make our Report than our predecessors did.

The decision announced by the Lord Chancellor to introduce legislation as soon as possible to deal with the problem of imperfect trust instruments—to which your Lordships will find that my colleagues and I drew attention in paragraphs 491–517 of Chapter 12 of our Report, and upon which the members of the Committee were unanimous—is in line with the views of my Committee that a policy statement should be made by Her Majesty's Government upon this particular matter in conjunction with the presentation of the Report to Parliament. I have had no opportunity of comparing the Government's proposals with the recommendations of the Report and therefore naturally I reserve comment on them. I wish to emphasise, as the Lord Chancellor's statement indicates, that this, though important, is not a problem of central importance—

THE SECRETARY OF STATE FOR COMMONWEALTH RELATIONS (VISCOUNT SWINTON)

My Lords, I am greatly interested in the statement which the noble Lord is in the process of making, but we have some rules of order or convenience in this House, and one is that Question time is Question time and not a time for making general statements.

LORD NATHAN

I sought the indulgence of your Lordships, but I do not question that the noble Viscount is perfectly justified in raising the point he has raised. I was making a concluding sentence, but now, of course, I will refrain from finishing it.

THE LORD CHANCELLOR

My Lords, with regard to the point raised by the noble Viscount, Lord Samuel, a debate can, of course, be arranged through the usual channels. I hope the noble Viscount will not be in too great a hurry about it, because there is a good deal to digest in this remarkable Report of Lord Nathan and his Committee. I propose, if the noble Lord will allow me, to say how grateful I am—as, I am sure, are all the members of the profession to which I belong—for the Report which he and they have produced.

VISCOUNT SAMUEL

The fact that I have put down my Question with no date named should be a sufficient answer to the noble and learned Lord's remark.