some default text...

Charities Bill (HL Bill 80)

Charities BillPage 40

(3) In subsection (1)(a)(i), the reference to the trustee having been adjudged
bankrupt includes a reference to the trustee’s estate having been sequestrated.

(4) This section does not apply in relation to an exempt charity except at a time
after the Commission has instituted an inquiry under section 46 with respect to
5it.

81 Removal or appointment of charity trustees etc.: supplementary

(1) The powers of the Commission under sections 76, 79 and 80 to remove or
appoint charity trustees of its own motion include power to make any such
order with respect to the vesting in or transfer to the charity trustees of any
10property as the Commission could make on the removal or appointment of a
charity trustee by it under section 69 (Commission’s concurrent jurisdiction
with High Court for certain purposes).

(2) Any order under any of those sections or this section—

(a) for the removal or appointment of a charity trustee or trustee for a
15charity, or

(b) for the vesting or transfer of any property,

has the same effect as an order made under section 69.

(3) Subsection (1) does not apply in relation to an exempt charity except at a time
after the Commission has instituted an inquiry under section 46 with respect to
20it.

82 Removal of trustees etc.: notice

(1) Before exercising any jurisdiction by virtue of section 79 or 80, the Commission
must give notice of its intention to do so to each of the charity trustees, except
any that cannot be found or has no known address in the United Kingdom.

(2) 25Any such notice—

(a) may be given by post, and

(b) if given by post, may be addressed to the recipient’s last known address
in the United Kingdom.

83 Power to suspend or remove trustees etc. from membership of charity

(1) 30Subsection (2) applies where—

(a) the Commission makes an order under section 76(3) suspending from
office or employment a person who is a trustee, charity trustee, officer,
agent or employee of a charity, and

(b) the person is a member of the charity.

(2) 35The Commission may also make an order suspending the person’s
membership of the charity for the period for which the person is suspended
from office or employment.

(3) Subsection (4) applies where—

(a) the Commission makes an order under section 79(2) removing from
40office or employment a person who is an officer, agent or employee of
a charity, and

(b) the person is a member of the charity.

Charities BillPage 41

(4) The Commission may also make an order—

(a) terminating the person’s membership of the charity, and

(b) prohibiting the person from resuming membership of the charity
without the Commission’s consent.

(5) 5If an application for the Commission’s consent under subsection (4)(b) is made
5 years or more after the order was made, the Commission must grant the
application unless satisfied that, because of any special circumstances, it
should be refused.

84 Power to direct specified action to be taken

(1) 10This section applies where, at any time after the Commission has instituted an
inquiry under section 46 with respect to any charity, it is satisfied either as
mentioned in section 76(1)(a) (misconduct or mismanagement etc.) or as
mentioned in section 76(1)(b) (need to protect property etc.).

(2) The Commission may by order direct—

(a) 15the charity trustees,

(b) any trustee for the charity,

(c) any officer or employee of the charity, or

(d) (if a body corporate) the charity itself,

to take any action specified in the order which the Commission considers to be
20expedient in the interests of the charity.

(3) An order under this section—

(a) may require action to be taken whether or not it would otherwise be
within the powers exercisable by the person or persons concerned, or
by the charity, in relation to the administration of the charity or to its
25property, but

(b) may not require any action to be taken which is prohibited by any Act
or expressly prohibited by the trusts of the charity or is inconsistent
with its purposes.

(4) Anything done by a person or body under the authority of an order under this
30section is to be treated as properly done in the exercise of the powers
mentioned in subsection (3)(a).

(5) Subsection (4) does not affect any contractual or other rights arising in
connection with anything which has been done under the authority of such an
order.

85 35Power to direct application of charity property

(1) This section applies where the Commission is satisfied—

(a) that a person or persons in possession or control of any property held
by or on trust for a charity is or are unwilling to apply it properly for
the purposes of the charity, and

(b) 40that it is necessary or desirable to make an order under this section for
the purpose of securing a proper application of that property for the
purposes of the charity.

(2) The Commission may by order direct the person or persons concerned to apply
the property in such manner as is specified in the order.

Charities BillPage 42

(3) An order under this section—

(a) may require action to be taken whether or not it would otherwise be
within the powers exercisable by the person or persons concerned in
relation to the property, but

(b) 5may not require any action to be taken which is prohibited by any Act
or expressly prohibited by the trusts of the charity.

(4) Anything done by a person under the authority of an order under this section
is to be treated as properly done in the exercise of the powers mentioned in
subsection (3)(a).

(5) 10Subsection (4) does not affect any contractual or other rights arising in
connection with anything which has been done under the authority of such an
order.

86 Copy of certain orders, and reasons, to be sent to charity

(1) Where the Commission makes an order under a provision mentioned in
15subsection (2) it must send the documents mentioned in subsection (3)—

(a) to the charity concerned (if a body corporate), or

(b) (if not) to each of the charity trustees.

(2) The provisions are—

  • section 76 (suspension of trustees etc. and appointment of interim
    20managers);

  • section 79 (removal of trustee or officer etc. for protective etc. purposes);

  • section 80 (other powers to remove or appoint charity trustees);

  • section 81 (removal or appointment of charity trustees etc.:
    supplementary);

  • 25section 83 (power to suspend or remove trustees etc. from membership of
    charity);

  • section 84 (power to direct specified action to be taken);

  • section 85 (power to direct application of charity property).

(3) The documents are—

(a) 30a copy of the order, and

(b) a statement of the Commission’s reasons for making it.

(4) The documents must be sent to the charity or charity trustees as soon as
practicable after the making of the order.

(5) The Commission need not comply with subsection (4) in relation to the
35documents, or (as the case may be) the statement of its reasons, if it considers
that to do so—

(a) would prejudice any inquiry or investigation, or

(b) would not be in the interests of the charity;

but, once the Commission considers that this is no longer the case, it must send
40the documents, or (as the case may be) the statement, to the charity or charity
trustees as soon as practicable.

(6) Nothing in this section requires any document to be sent to a person who—

(a) cannot be found, or

(b) has no known address in the United Kingdom.

Charities BillPage 43

(7) Any documents required to be sent to a person under this section may be sent
to, or otherwise served on, the person in the same way as an order made by the
Commission under this Act could be served on the person in accordance with
section 339.

87 5Supervision by Commission of certain Scottish charities

(1) Sections 76 to 82 (except section 79(2)(b)) and sections 84 to 86 have effect in
relation to any body which—

(a) is entered in the Scottish Charity Register, and

(b) is managed or controlled wholly or mainly in or from England or
10Wales,

as they have effect in relation to a charity.

(2) Subsection (3) applies where—

(a) a body entered in the Scottish Charity Register is managed or
controlled wholly or mainly in or from Scotland, but

(b) 15any person in England and Wales holds any property on behalf of the
body or of any person concerned in its management or control.

(3) If the Commission is satisfied, on the basis of such information as may be
supplied to it by the Scottish Charity Regulator, as to the matters mentioned in
subsection (4), it may make an order requiring the person holding the property
20not to part with it without the Commission’s approval.

(4) The matters are—

(a) that there has been any misconduct or mismanagement in the
administration of the body, and

(b) that it is necessary or desirable to make an order under subsection (3)
25for the purpose of protecting the property of the body or securing a
proper application of such property for the purposes of the body.

(5) Subsection (6) applies where—

(a) any person in England and Wales holds any property on behalf of a
body entered in the Scottish Charity Register or of any person
30concerned in the management or control of such a body, and

(b) the Commission is satisfied (whether on the basis of such information
as may be supplied to it by the Scottish Charity Regulator or
otherwise)—

(i) that there has been any misconduct or mismanagement in the
35administration of the body, and

(ii) that it is necessary or desirable to make an order under
subsection (6) for the purpose of protecting the property of the
body or securing a proper application of such property for the
purposes of the body.

(6) 40The Commission may by order—

(a) vest the property in such body or charity as is specified in the order in
accordance with subsections (7) and (8),

(b) require any persons in whom the property is vested to transfer it to any
such body or charity, or

(c) 45appoint any person to transfer the property to any such body or charity.

(7) The Commission may specify in an order under subsection (6)—

Charities BillPage 44

(a) such other body entered in the Scottish Charity Register, or

(b) such charity,

as it considers appropriate, if the purposes of the body or charity are, in the
opinion of the Commission, as similar in character to those of the body referred
5to in subsection (5)(a) as is reasonably practicable.

(8) But the Commission must not so specify any body or charity unless it has
received from—

(a) the persons concerned in the management or control of the body, or

(b) (as the case may be) the charity trustees of the charity,

10written confirmation that they are willing to accept the property.

Publicity relating to schemes and orders

88 Publicity relating to schemes

(1) The Commission may not—

(a) make any order under this Act to establish a scheme for the
15administration of a charity, or

(b) submit such a scheme to the court or the Minister for an order giving it
effect,

unless, before doing so, the Commission has complied with the publicity
requirements in subsection (2).

20This is subject to any disapplication of those requirements under subsection
(4).

(2) The publicity requirements are—

(a) that the Commission must give public notice of its proposals, inviting
representations to be made to it within a period specified in the notice,
25and

(b) that, in the case of a scheme relating to a local charity (other than an
ecclesiastical charity) in a parish, or in a community in Wales, the
Commission must communicate a draft of the scheme to—

(i) the parish council or, if the parish has no council, the chairman
30of the parish meeting, or

(ii) the community council or, if the community has no council, the
county council or county borough council.

(3) The time when any such notice is given or any such communication takes place
is to be decided by the Commission.

(4) 35The Commission may determine that either or both of the publicity
requirements is or are not to apply in relation to a particular scheme if it is
satisfied that—

(a) because of the nature of the scheme, or

(b) for any other reason,

40compliance with the requirement or requirements is unnecessary.

(5) Where the Commission gives public notice of any proposals under this
section—

(a) it must take into account any representations made to it within the
period specified in the notice, and

Charities BillPage 45

(b) it may (without further notice) proceed with the proposals either
without modifications or with such modifications as it thinks desirable.

(6) Where the Commission makes an order under this Act to establish a scheme for
the administration of a charity, a copy of the order must be available, for at
5least a month after the order is published, for public inspection at all reasonable
times—

(a) at the Commission’s office, and

(b) if the charity is a local charity, at some convenient place in the area of
the charity.

(7) 10Subsection (6)(b) does not apply if the Commission is satisfied that for any
reason it is unnecessary for a copy of the scheme to be available locally.

(8) Any public notice of any proposals which is to be given under this section—

(a) is to contain such particulars of the proposals, or such directions for
obtaining information about them, as the Commission thinks sufficient
15and appropriate, and

(b) is to be given in such manner as the Commission thinks sufficient and
appropriate.

89 Publicity for orders relating to trustees or other individuals

(1) The Commission may not make any order under this Act to appoint, discharge
20or remove a charity trustee or trustee for a charity, other than—

(a) an order relating to the official custodian, or

(b) an order under section 76(3)(b) (appointment of additional charity
trustees),

unless, before doing so, the Commission has complied with the publicity
25requirement in subsection (2).

This is subject to any disapplication of that requirement under subsection (4).

(2) The publicity requirement is that the Commission must give public notice of its
proposals, inviting representations to be made to it within a period specified in
the notice.

(3) 30The time when any such notice is given is to be decided by the Commission.

(4) The Commission may determine that the publicity requirement is not to apply
in relation to a particular order if it is satisfied that for any reason compliance
with the requirement is unnecessary.

(5) Before the Commission makes an order under this Act to remove a person who
35is—

(a) a charity trustee or trustee for a charity, or

(b) an officer, agent or employee of a charity,

without the person’s consent, the Commission must give the person not less
than one month’s notice of its proposals, inviting representations to be made
40to it within a period specified in the notice.

This does not apply if the person cannot be found or has no known address in
the United Kingdom.

(6) Where the Commission gives notice of any proposals under this section—

(a) it must take into account any representations made to it within the
45period specified in the notice, and

Charities BillPage 46

(b) it may (without further notice) proceed with the proposals either
without modifications or with such modifications as it thinks desirable.

(7) Any notice of any proposals which is to be given under this section—

(a) is to contain such particulars of the proposals, or such directions for
5obtaining information about them, as the Commission thinks sufficient
and appropriate, and

(b) (in the case of a public notice) is to be given in such manner as the
Commission thinks sufficient and appropriate.

(8) Any notice to be given under subsection (5)—

(a) 10may be given by post, and

(b) if given by post, may be addressed to the recipient’s last known address
in the United Kingdom.

Property vested in official custodian

90 Entrusting charity property to official custodian, and termination of trust

(1) 15The court may by order—

(a) vest in the official custodian any land held by or in trust for a charity,

(b) authorise or require the persons in whom any such land is vested to
transfer it to the official custodian, or

(c) appoint any person to transfer any such land to the official custodian.

(2) 20But subsection (1) does not apply to any interest in land by way of mortgage or
other security.

(3) Where property is vested in the official custodian in trust for a charity, the
court may make an order discharging the official custodian from the
trusteeship as respects all or any of that property.

(4) 25Where—

(a) the official custodian is discharged from the trusteeship of any
property, or

(b) the trusts on which the official custodian holds any property come to an
end,

30the court may make such vesting orders and give such directions as may seem
to the court to be necessary or expedient in consequence.

(5) No person is liable for any loss occasioned by—

(a) acting in conformity with an order under this section, or

(b) giving effect to anything done in pursuance of such an order.

(6) 35No person is excused from—

(a) acting in conformity with an order under this section, or

(b) giving effect to anything done in pursuance of such an order,

because the order has been in any respect improperly obtained.

91 Supplementary provisions as to property vested in official custodian

(1) 40Subject to the provisions of this Act, where property is vested in the official
custodian in trust for a charity, the official custodian—

(a) must not exercise any powers of management, but

Charities BillPage 47

(b) as trustee of any property—

(i) has all the same powers, duties and liabilities,

(ii) is entitled to the same rights and immunities, and

(iii) is subject to the control and orders of the court in the same way,

5as a corporation appointed custodian trustee under section 4 of the
Public Trustee Act 1906.

(2) Subsection (1) does not confer on the official custodian a power to charge fees.

(3) Subject to subsection (4), where any land is vested in the official custodian in
trust for a charity, the charity trustees may, in the name and on behalf of the
10official custodian, execute and do all assurances and things which they could
properly execute or do in their own name and on their own behalf if the land
were vested in them.

(4) If any land is so vested in the official custodian by virtue of an order under
section 76(3)(c), the power conferred on the charity trustees by subsection (3) is
15not exercisable by them in relation to any transaction affecting the land, unless
the transaction is authorised by order of the court or of the Commission.

(5) Where any land is vested in the official custodian in trust for a charity—

(a) the charity trustees have the same power to make obligations entered
into by them binding on the land as if it were vested in them, and

(b) 20any covenant, agreement or condition which is enforceable by or
against the official custodian because the land is vested in the official
custodian is enforceable by or against the charity trustees as if the land
were vested in them.

(6) In relation to a corporate charity, subsections (3) to (5) apply with the
25substitution of references to the charity for references to the charity trustees.

(7) Subsections (3) to (5) do not authorise any charity trustees or charity to impose
any personal liability on the official custodian.

(8) Where the official custodian is entitled as trustee for a charity to the custody of
securities or documents of title relating to the trust property, the official
30custodian may permit them to be in the possession or under the control of the
charity trustees without incurring any liability by doing so.

Official custodian and Reverter of Sites Act 1987

92 Divestment of official custodian where 1987 Act due to operate

(1) Subsection (2) applies where—

(a) 35any land is vested in the official custodian in trust for a charity, and

(b) it appears to the Commission that section 1 of the 1987 Act (right of
reverter replaced by trust) will, or is likely to, operate in relation to the
land at a particular time or in particular circumstances.

(2) The jurisdiction which, under section 69, is exercisable by the Commission for
40the purpose of discharging a trustee for a charity may, at any time before
section 1 of the 1987 Act operates in relation to the land, be exercised by the
Commission of its own motion for the purpose of—

(a) making an order discharging the official custodian from the trusteeship
of the land, and

Charities BillPage 48

(b) making such vesting orders and giving such directions as appear to the
Commission to be necessary or expedient in consequence.

(3) In this section and sections 93 to 95—

(a) “the 1987 Act” means the Reverter of Sites Act 1987, and

(b) 5any reference to section 1 of the 1987 Act operating in relation to any
land is a reference to a trust arising in relation to the land under that
section.

93 Divestment of official custodian where 1987 Act has operated

(1) Subsection (2) applies where—

(a) 10section 1 of the 1987 Act has operated in relation to any land which,
immediately before the time when that section so operated, was vested
in the official custodian in trust for a charity, and

(b) the land remains vested in the official custodian but on the trust arising
under that section.

(2) 15The court or the Commission (of its own motion) may—

(a) make an order discharging the official custodian from the trusteeship
of the land, and

(b) (subject to sections 94 and 95) make such vesting orders and give such
directions as appear to it to be necessary or expedient in consequence.

94 20Vesting of land in relevant charity trustees following divestment

(1) Subsection (2) applies where an order discharging the official custodian from
the trusteeship of any land—

(a) is made by—

(i) the court under section 90(3), or

(ii) 25the Commission under section 69,

on the ground that section 1 of the 1987 Act will, or is likely to, operate
in relation to the land, or

(b) is made by the court or the Commission under section 93.

(2) The persons in whom the land is to be vested on the discharge of the official
30custodian are the relevant charity trustees, unless the court or (as the case may
be) the Commission is satisfied that it would be appropriate for it to be vested
in some other persons.

(3) In subsection (2) “the relevant charity trustees” means—

(a) in relation to an order made as mentioned in subsection (1)(a), the
35charity trustees of the charity in trust for which the land is vested in the
official custodian immediately before the time when the order takes
effect, or

(b) in relation to an order made under section 93, the charity trustees of the
charity in trust for which the land was vested in the official custodian
40immediately before the time when section 1 of the 1987 Act operated in
relation to the land.

95 Supplementary provisions in connection with 1987 Act

(1) Subsection (2) applies where—

Charities BillPage 49

(a) section 1 of the 1987 Act has operated in relation to any such land as is
mentioned in section 93(1)(a), and

(b) the land remains vested in the official custodian as mentioned in
section 93(1)(b).

(2) 5Subject to subsection (3)—

(a) all the powers, duties and liabilities that would, apart from this section,
be those of the official custodian as trustee of the land are instead to be
those of the charity trustees of the charity concerned, and

(b) those trustees may, in the name and on behalf of the official custodian,
10execute and do all assurances and things which they could properly
execute or do in their own name and on their own behalf if the land
were vested in them.

(3) Subsection (2) is not to be treated as requiring or authorising those trustees to
sell the land at a time when it remains vested in the official custodian.

(4) 15Where—

(a) the official custodian has been discharged from the trusteeship of any
land by an order under section 93, and

(b) the land has, in accordance with section 94, been vested in the charity
trustees concerned or (as the case may be) in any persons other than
20those trustees,

the land is to be held by those trustees, or (as the case may be) by those persons,
as trustees on the terms of the trust arising under section 1 of the 1987 Act.

(5) The official custodian is not liable to any person in respect of any loss or
misapplication of any land vested in the official custodian in accordance with
25section 1 of the 1987 Act unless it is occasioned by or through any wilful neglect
or default of—

(a) the official custodian, or

(b) any person acting for the official custodian.

(6) But the Consolidated Fund is liable to make good to any person any sums for
30which the official custodian may be liable because of any such neglect or
default.

Establishment of common investment or deposit funds

96 Power to make common investment schemes

(1) The court or the Commission may by order make and bring into effect schemes
35for the establishment of common investment funds under trusts which
provide—

(a) for property transferred to the fund by or on behalf of a charity
participating in the scheme to be invested under the control of trustees
appointed to manage the fund, and

(b) 40for the participating charities to be entitled (subject to the provisions of
the scheme) to the capital and income of the fund in shares determined
by reference to the amount or value of the property transferred to it by
or on behalf of each of them and to the value of the fund at the time of
the transfers.

(2) 45In this section and sections 97 to 99 “common investment scheme” means a
scheme under subsection (1).