Follow us on Twitter

Charity Trustees fear breach of trust and council acting ultra vires advice sought

0 votes
Its a story.  The village has a field handed over in 1920 to the council to hold in trust and for a committee of management to manage it.  This under the 1859 Recreation grounds act.    Over time the council and committee of management became intertwined as buildings appeared on the field and the committee of management got into financial difficulties. In 1964 the field and all on it were registered as a charity.  In 2007 the trustees voted to hand over the running of the field to the parish council.  This left a trustee committee (4 councillors and 6 others) in operation and annually a vote to appoint them at the annual parish meeting.   Unfortunately the trustees and the council failed to ratify the handover decision and change the governing deed.   Now the council is running the field as a council (not as a charity). The trustees have carried out a review of the charity and found that they are still responsible for it all and that various letters over time to the council and trustees from the charity commission have pointed this out (same question, same answer).   The trustees have engaged acre and soon the charity commission to help sort it out and have informed the council.  Unfortunately there are no councillors on the trustee committee due to a lack of volunteers. However the council does not recognise that they are acting ultra vires (the council never voted to accept the offer, and although the trustees vote each year to allow the council to manage the field, they do not write to the council asking them to do so, and the council do not vote to do it).   I think we are on the right track to sort it out (via acre and the charity commission), but wonder if anyone has advice as to get the councillors attention.  All trustees and councillors involved in 2007 have fled the coop, so its a set of new people trying to sort it out.  Although I am surprised that a council can manage a charity for so long without twigging that the absence of any reference to the charity, the trustees and founding doc in its procedures (and no document explaining who does what and when) and ditto the trustees.
by (1.0k points)

1 Answer

+1 vote
ACRE will sort this out for you. With another hat on, I can assure you that it's the sort of thing ACRE deals with all the time. Such situations are surprisingly common. In the meantime, the Council should cease to act, as they have no authority to do so. That doesn't mean that the grass cutting must stop, but the Council should not be seen to be exercising any control. Do only what ACRE tells you to do.

Retrospective reimbursement is unlikely to be required and there should be no naming and shaming. It's history now. The issues you might need to address in the near future will include insurance and ownership of assets if buildings or children's play equipment etc have been erected. I'm working on one at the moment where a Parish Council has built a community centre on land it thought it owned, but which actually belongs to a charity.
ago by (37.2k points)
Dave    Thanks and will report back.  We all have  high hopes of getting this resolved win win style.
I don't fall out with anything that Dave has said.  In the absence of that I would have said you should appoint solicitors to sort out the whole situation  - and I don't mean that should be adversarial - it is in the equal interest of both parties to have clarity.
John 1706   I would not disagree.  However the trustees do not have 2 pennies to rub together having handed over cash and various bits and bobs over the years in the 'not quite sure who did what' years.    Well about £1400 in the kitty!   So steady progress and legal advice when required, not adversarial and that in all probability linked to who owns what and how.
There's always a temptation to turn to solicitors in such a situation, but, if truth be told, the average solicitor is not well equipped to deal with such matters. There are specialists who have the knowledge and experience to take this on, but their bill may well be five figures. That is, in part, due to their inordinately high hourly charge-out rate, but also down to the fact that any negotiation with the Charity Commission is likely to be long-winded and laborious.
Dave    Thanks   The past docs show solicitor and charity commission input.  The trustees and council have seemed to ask the same question each time (what is the situation) and the answer is always the same.  This time all available docs have been gone though to understand what went on, and a lot of guidance gone through, and old stuff at that as guidance varies over time.  The idea is to admit we no further forwards in legal terms than 2007, and put a set of options on the table for the council and trustees to consider (and a few on either side are still wedded to the past).  Then work with both sides to get it fixed.  Thanks all for your comments and advice and I will turn up for some more soo I expect.
Without seeing the documents, I'm going to stick my neck out and say that a 1964 charity governing document would probably have specified that changes required the written consent of the Charity Commission, so without such consent, nothing changed legally in 2007, the Trustees should have continued to operate the charity in accordance with its governing document (i.e. AGM, appointments/reappointments, minutes, accounts etc), with the Council presumably acting as the Holding Trustee as landowner (although this would depend on the 1920 documentation).
Dave   The charity commission have only the 1920 Indenture, It was not changed in 1964 so it does not refer to more recent laws.  However, in past communications the charity commission have informed the council (who were trying to close the charity) that it needed the trustees to apply to do that, and the charity commission would then work with the council to set up the appropriate structure to manage the field in trust.  The council will be briefed next week at full council, but I think it will take a while to get the council to the table.
Just to note - the trustees were not happy the council had applied to get rid of them.
The Charity Commission will only accept instructions from the Trustees, as they don't recognise the Council as a controller of the charity and I'm not surprised the Trustees were unhappy!

Welcome to Town & Parish Councillor Q&A, where you can ask questions and receive answers from other members of the community. All genuine questions and answers are welcome. Follow us on Twitter to see the latest questions as they are asked - click on the image button above or follow @TownCouncilQA. Posts from new members may be delayed as we are unfortunately obliged to check each one for spam. Spammers will be blacklisted.

You may find the following links useful:

We have a privacy policy and a cookie policy.

Google Analytics Alternative