Scottish Burial Reform and Cremation Society Ltd v Glasgow Corpn

An institution falls within the fourth head of charity where its purposes benefit the community and are charitable within the evolving spirit and intendment of the preamble to the Statute of Elizabeth. That inquiry may proceed by analogy with purposes already recognised as charitable, but the established categories must remain responsive to changing social needs.

Providing inexpensive and sanitary facilities for disposing of human remains, including cremation, is a charitable purpose of public utility. A non-profit institution does not lose that status merely because it charges for its services, accumulates reasonable reserves, benefits some individuals, or operates in a field where similar services may also be supplied commercially.

The appellant was a non-profit company established to promote inexpensive and sanitary methods of disposing of the dead, particularly cremation. It operated a Glasgow crematorium and sought partial remission of local rates under section 4(2) of the Local Government (Financial Provisions etc.) (Scotland) Act 1962.

The Lord Ordinary dismissed the action. A majority of the Second Division agreed that the company's purposes were not within the spirit and intendment of the preamble to the Statute of Elizabeth; Lord Walker dissented. There was also disagreement below about whether sufficient public benefit had been shown.

The central issue was whether the company was established for charitable purposes only under the English law of charity incorporated by the 1962 Act.

1. The appeal was allowed unanimously. Lord Reid, Lord Upjohn and Lord Wilberforce delivered reasoned speeches. Lord Guest agreed with Lord Reid and Lord Wilberforce, and Lord Pearson agreed. The company was a charity and was entitled to the statutory rating remission.

2. Per Lord Reid, Lord Upjohn and Lord Wilberforce, a purpose within Lord Macnaghten's fourth charitable category must benefit the community and must be charitable within the spirit and intendment of the preamble to the Statute of Elizabeth. The latter requirement is applied broadly through the developing body of decisions concerning the preamble. Lord Wilberforce emphasised that the classification in Pemsel's case was one of convenience, not statutory language, and that charity law may evolve with changing social needs.

3. Per Lord Reid, the courts may find the necessary connection by analogy either with an object stated in the preamble or with an object already held charitable. Decisions involving broadly framed discretionary gifts required stricter treatment because the discretion might extend to non-charitable objects. That line of authority did not govern an institution with clearly specified purposes.

4. Per Lord Upjohn and Lord Wilberforce, disposal of the dead is a public necessity and public utility. The statutory recognition of cremation and its extensive public use confirmed its public benefit. The authorities concerning churchyards, burial grounds and public cemeteries supplied a sufficient analogy. Cremation services also fell in their own right within the preamble's spirit as services of general public utility. The company did not have to prove that cremation was cheaper, more sanitary or otherwise better than burial.

5. Per Lord Reid and Lord Wilberforce, charging fees did not destroy the charitable character of services supplied for an independently charitable purpose. Lord Upjohn reached the same conclusion and observed that the company was not conducting a trade. The absence of distributions to members and the application of income and property solely to the company's objects supported its non-profit character. Possible incidental benefits to individuals, reasonable reserves, and the existence or possible entry of commercial suppliers did not disqualify it on the facts.

6. The orders dismissing the action were displaced and the appellant's claim to remission under section 4(2) of the Local Government (Financial Provisions etc.) (Scotland) Act 1962 succeeded.

1. House of Lords: Allowed the appeal unanimously and held that the appellant was a charity entitled to rating remission under section 4(2) of the Local Government (Financial Provisions etc.) (Scotland) Act 1962.

2. Second Division of the Court of Session: By a majority comprising the Lord Justice-Clerk, Lord Strachan and Lord Wheatley, affirmed dismissal of the action; Lord Walker dissented. The majority held that the purposes were not within the spirit and intendment of the preamble to the Statute of Elizabeth.

3. Lord Ordinary: Dismissed the action as irrelevant. He accepted that the purposes benefited the community but held that they were outside the spirit and intendment of the preamble.