Satish Jamnadas Chatwani & Ors v Chirag Mehta & Ors

A charitable constitution is construed using ordinary contractual principles, read against the background reasonably available to users of the public document. Informality may affect the consequences of a breach, but it does not alter what the rules require. Notice of a meeting must fairly identify the substance of the business, so recipients can decide whether to attend or consent to short notice. A materially misleading notice, or failure to notify a member whose constitutional status is being removed, can invalidate the meeting. Charity trustees must act transparently and co-operatively for the charity and its beneficiaries collectively. Declaratory relief may restore the position after a takeover achieved through constitutional breaches, even where a fresh vote might otherwise be possible.

The claim concerned the governance of a religious charitable unincorporated association and its property-holding company. The claimants challenged amendments made at a trustees’ meeting on 5 November 2021. The amendments removed Member A, a constitutional office with veto and control powers, and placed the UK charity under trustee control. The defendants said that the meeting was properly convened, quorate and conducted in the charity’s interests.

The court considered whether Prem Swami had become Member A under the 2013 Constitution; whether he and other members were entitled to notice; whether the email notice misleadingly described the meeting as a conversion to a charitable incorporated organisation; whether the meeting was quorate and properly conducted; and whether declaratory relief should be refused because a fresh meeting could repeat the decision. An alternative fiduciary-duty ground was also considered.

Disposition. Judgment was given for the claimants. The 2021 Constitution was not validly adopted and had no effect. Prem Swami was Member A and retained the constitutional veto and appointment powers.

1. Construction. The 2013 Constitution was to be construed using ordinary contractual principles, while taking account of the background known to users of a public religious constitution and the beliefs informing the succession arrangements. The distinction in Speechley v Allott [2014] EWCA Civ 230 between the meaning of the rules and the consequences of non-compliance was material. Flexibility could affect the latter, not the former.
2. Member A and notice. The Disputed Letter was authentic and effectively notified the change in the presidency. It made Prem Swami Member A when received, alternatively when supplied to the trustees’ solicitors on 31 May 2022. Although not a voting member, Member A was a constitutional member entitled to notice. Failure to notify him of a meeting abolishing his status would have vitiated the meeting.
3. Misleading notice. The email described the meeting as principally concerned with conversion to a charitable incorporated organisation and asserted that the solicitors had advised upon a two-stage process. Those statements were false. The notice did not fairly disclose the proposed abolition of Member A and the transfer of control. The consent of absent members to short notice was therefore ineffective, and the purported business was invalid.
4. Quorum and conduct. Trustees validly appointed under the earlier constitution remained validly appointed after the 2013 restructuring. The meeting was consequently quorate. The rushed conduct of the meeting, failure to circulate the amended constitution and uninformed signature did not independently invalidate it because the relevant vote could not have altered the result.
5. Fiduciary duties. Obiter, the court considered that the reasoning in Saxon Woods Investments Limited v Costa [2026] UKSC 21 could extend a duty of collegiality and co-operation to charity trustees. The deliberate attempt to mislead fellow trustees was contrary to those duties, although that conclusion was not necessary to grant the declarations.
6. Relief. The factors identified in Financial Services Authority v Rourke [2002] CP Rep 14 supported declaratory relief. The company-law authorities in MacDougall v Gardiner (1875) 1 Ch. D. 13 and Bamford v Bamford [1970] Ch 212 did not make the declaration otiose. The charity context, the constitutional breaches and the uncertainty of any future vote justified restoring the position under the 2013 Constitution.