Hanchett-Stamford v Attorney General & Ors

A trust whose purposes include changing the law is not charitable, even where the proposed change concerns animal welfare. Advocacy for legal change may be a means of pursuing exclusively charitable purposes, but changing the law cannot itself be a charitable purpose. An unincorporated association has no separate legal personality. Its assets are beneficially owned by its members, subject to their contractual rights and restrictions. Where membership falls to one living member and the association consequently ceases to exist, that member is entitled to the assets, unless the association’s rules or the terms on which assets were acquired provide otherwise. Assets do not thereby become bona vacantia.

The claimant was the sole surviving member of the Performing and Captive Animals Defence League, an unincorporated association founded to oppose cruelty to performing animals and to promote legislative change. She sought declarations that the League was charitable and orders appointing trustees to transfer its assets to the Born Free Foundation. The Attorney-General opposed the claim. Dr Jordan was joined as a defendant, and Barclays Bank Trust Company Ltd intervened concerning a legacy mistakenly paid to the Captive Animals Protection Trust.

The principal issues were whether the League was, or had become, charitable; who was entitled to its assets if it was not charitable; and whether the claimant could be appointed trustee.

1. Charitable status. A charitable trust must be of a charitable nature, promote a recognised public benefit, and be wholly and exclusively charitable. Prevention of cruelty to animals can satisfy those requirements through its indirect benefit to humanity. However, a trust with a purpose of changing the law cannot be charitable. The distinction is between a charity’s purposes and the means used to promote them: a charity may campaign for legislative change, but an organisation established to secure such change is not charitable.

2. The League’s published objectives showed that a significant purpose was to secure further legislation and, in substance, to prohibit performing animals. The Animal Welfare Act 2006 and recognition of animal welfare in the Charities Act 2006 did not remove that purpose or alter the fundamental rule. The evidence did not establish cumulative changes of the kind that had led to reconsideration of the charitable status of the General Medical Council. The League was therefore not charitable at its inception and had never become charitable.

3. The claimant’s informal decision with her husband to give the assets to the Born Free Foundation did not create an express trust or alter the contractual constitution of the League. In particular, the statutory requirement for a declaration of trust of land to be evidenced in writing was not satisfied.

4. Ownership of the assets. The authorities establish that property held for an unincorporated association is beneficially owned by its members, subject to the contractual restrictions governing the association. Those restrictions cease when the association is dissolved or its contractual structure can no longer operate. The League continued until Mr Hanchett-Stamford’s death, when its membership fell below two and it ceased to exist.

5. The court declined to follow the obiter view that a sole surviving member cannot claim the assets and that they instead vest in the Crown as bona vacantia. The claimant, as the sole surviving member, was entitled to the assets, including Sid Abbey and the investments, free from the League’s former restrictions. The conclusion was also supported by the protection of possessions under article 1 of Protocol 1 to the European Convention on Human Rights and Fundamental Freedoms.

6. The declaration that the League was charitable and the order appointing trustees were refused. Declarations giving effect to the claimant’s ownership were to be prepared, with unresolved wording to be addressed when the judgment was handed down.