White & Ors v Williams & Ors

The cy-près jurisdiction may arise after a religious schism where property donated for the use of a particular congregation is controlled by trustees unable to communicate meaningfully with that congregation. It is unnecessary for the court to determine which faction represents the true faith. The spirit of the gift is identified broadly, by reference to its substance and the circumstances of the gift. A scheme should reflect that spirit while applying the statutory considerations of closeness to the original purposes and suitability in current social and economic circumstances. Where separate congregations have become autonomous, transferring each property to trustees serving the relevant congregation may be preferable to vesting all properties in common trustees.

The claimants were trustees of the Tabernacle Ministries of Great Britain. They sought a cy-près scheme transferring the Lewisham Building, held by the trustees of the Bibleway Church UK Trust, to the Tabernacle Trust. The building had been acquired principally through contributions from the Lewisham Congregation.

Following a schism in the parent United States church, the Lewisham, Bethnal Green and Mitcham congregations became autonomous, while the Bibleway Trust came under the control of trustees associated with a different faction. The central issues were whether the statutory jurisdiction was engaged, whether a scheme should be made, and how the original charitable purposes and the spirit of the gifts should be reflected.

1. Jurisdiction. The court held that the circumstances in section 13(1)(e)(iii) of the Charities Act 1993 were satisfied. The schism and the subsequent control of the trust meant that the buildings were no longer being administered as suitable and effective places of worship and witness for the congregations whose contributions had funded them. It was unnecessary to decide which faction represented the true faith or whether the congregations remained members of the Bibleway Church UK.
2. Spirit of the gifts. Applying the guidance in Varsani v Jesani [1999] Ch 219, the spirit of each gift was broader than the literal wording of the trust deed. The relevant buildings, or their value, were intended to provide places of worship and witness for the contributing congregations for as long as those congregations continued. The evidence did not establish a special trust restricting the Lewisham Building exclusively to the Lewisham Congregation, but it did establish that expectation as the spirit of the gift.
3. Exercise of the power. The matters in section 14B of the Charities Act 1993 required a scheme. The best solution was to transfer the Lewisham, Bethnal Green and Mitcham buildings to separate charitable trustees serving the respective congregations, rather than require the congregations to repurchase their buildings or place them under common trustees. The proposed purposes of the Tabernacle Trust were sufficiently close to the original purposes, but the scheme should include an express limitation reflecting the spirit of the original gift.
4. The precise terms of the scheme, the treatment of creditors and trustee indemnities, and whether the court or the Charity Commission should make the scheme were left for a further hearing, with relevant congregations and creditors represented.

Not stated in the judgment. This was a first-instance decision.