non-charitable purpose trusts cases

Morice v Bishop of Durham

Facts: A testatrix left her residuary estate to the Bishop of Durham to be applied "for such objects of benevolence and liberality" as he saw fit. The question was whether this created a valid trust.

Held: Invalid. The estate resulted back to the next of kin.

Reasoning: Sir William Grant MR stated the foundational principle — every trust must have a definite object, meaning there must be somebody in whose favour the court can decree performance. "Objects of benevolence and liberality" were too vague to constitute identifiable beneficiaries, and the purpose was not a recognised charitable one. Without a human beneficiary able to enforce the trust, it could not stand.

Principle: The beneficiary principle — a non-charitable trust must have ascertainable human beneficiaries who can enforce it. A trust for a vague abstract purpose is void. This is the foundational case for all non-charitable purpose trust analysis.

PQ use: Start here whenever a trust appears to be for a purpose rather than identifiable people. Ask — is there a human beneficiary who can enforce this? If not, is it charitable? If neither, it fails under Morice.

Re Shaw

Facts: George Bernard Shaw left money in his will to fund research into creating a new 40-letter phonetic alphabet, and to translate one of his plays into it. He argued this was charitable as it advanced education.

Held: Invalid non-charitable purpose trust.

Reasoning: Harman J held the purpose was not charitable — it was not the advancement of education because it did not teach anyone anything, it merely promoted Shaw's personal preference for spelling reform. And as a non-charitable purpose trust it failed the beneficiary principle — there was nobody who could enforce it. The trust failed entirely.

Principle: A purpose that merely promotes a personal preference or view is not charitable education. Confirms that non-charitable purpose trusts are void for want of a beneficiary. Also illustrates that the line between educational charity and personal agenda is drawn at whether the public actually learns something.

PQ use: Use when a testator tries to dress up an idiosyncratic personal purpose as charitable education. Also the clearest modern statement that non-charitable purpose trusts are void — use as the baseline rule before considering exceptions.

Re Endacott

Facts: A testator left his residue to the North Tawton Devon Parish Council "for the purpose of providing some useful memorial to myself." The council argued this was a valid purpose trust or alternatively fell within the anomalous exceptions for monuments and tombs.

Held: Invalid. The gift failed.

Reasoning: The Court of Appeal held the trust did not fall within the anomalous exceptions — those are limited to specific established categories and are not to be extended. A vague memorial to oneself is not within the tomb and monument exception. And as a non-charitable purpose trust it failed under Morice — no beneficiary, no enforcement. The court also warned that the anomalous exceptions should not be extended further.

The anomalous exceptions are specific categories of non-charitable purpose trust that English courts have historically tolerated despite failing the beneficiary principle. They are anomalies — the courts acknowledge they should not exist as a matter of principle but feel bound by authority to uphold them. Re Endacott confirmed they will not be extended further.

The established exceptions are:

Graves and tombs — trusts for the maintenance of a specific grave, tomb, or vault. Re Hooper is the key case. The courts uphold these on the basis of old authority even though they technically violate the beneficiary principle.

Monuments — trusts for the erection or maintenance of a monument to a specific person. Again upheld purely on historical authority.

Specific animals — trusts for the care of a specific identified animal or animals belonging to the testator. The classic case is Re Dean (1889) where a trust for horses and hounds was upheld. Not on your case list but the principle is established.

Saying of private masses — trusts for the saying of private masses for the testator's soul have been upheld in some jurisdictions, though this is more contested in English law.

Principle: The anomalous exceptions to the beneficiary principle (graves, tombs, monuments) are narrow and closed — they will not be extended. Any purpose outside those categories that lacks human beneficiaries fails as a void purpose trust.

PQ use: Use to show the court's reluctance to extend the anomalous exceptions. If a testator tries to create a purpose trust for something that looks like a monument but does not fit neatly within established categories, Re Endacott says it fails.

Re Hooper

Facts: A testator left money for the care and upkeep of certain graves, a vault, and a monument, and for the maintenance of a window in a church.

Held: Valid — but only so far as the perpetuity period allowed.

Reasoning: Maugham J held the trust for graves and monuments fell within the anomalous exception recognised in earlier cases. The court was bound by that exception even though it would not have recognised it as a matter of principle. However the trust could only last for the perpetuity period — any trust of this type that purports to be permanent is void for perpetuity.

Principle: The graves and monuments anomalous exception exists but is strictly limited. The court is bound by it historically but will not extend it. Subject to perpetuity rules — cannot last indefinitely.

PQ use: If a testator leaves money for grave maintenance or a family monument, Re Hooper says it is valid as an anomalous exception — but flag the perpetuity point. Under the Perpetuities and Accumulations Act 2009 s.5 the perpetuity period is now 125 years, but s.18 confirms the rule against duration for non-charitable purpose trusts is not affected — so the trust still cannot last beyond that period.

Re Denley's Trust Deed

Facts: A company conveyed land to trustees to be maintained as a sports ground "for the benefit of the employees" of the company, and secondarily for others at the trustees' discretion. A question arose whether this was a valid trust.

Held: Valid trust.

Reasoning: Goff J held this was not truly a purpose trust at all — it was a trust for the benefit of identifiable persons, namely the employees, even though it was expressed as a purpose. The employees were sufficiently identifiable and the trust directly and substantially benefited them in a way that gave them standing to enforce it. Because there were human beneficiaries who could come to court, the beneficiary principle was satisfied.

Principle: A trust expressed as a purpose but which directly and tangibly benefits ascertainable individuals is valid — it is construed as a trust for those persons rather than a purpose trust. This is the Re Denley anomaly — rescuing what looks like a purpose trust by finding implied beneficiaries.

PQ use: Whenever a purpose trust appears to benefit a defined group of people directly — employees, members of a club — argue Re Denley: construe it as a trust for those people, not a pure purpose trust, and it survives the beneficiary principle. The key question is whether the purpose directly benefits identifiable individuals who could enforce it.

A purpose trust is one where the trust property is held for an abstract objective or aim — with no identifiable human being who can come to court and say "I am personally entitled to benefit from this trust and I want to enforce it."

The classic examples are trusts for saying masses, maintaining graves, or funding a phonetic alphabet like Re Shaw. In all of those there is no person who has a personal entitlement to the property. The purpose just floats there with no one to enforce it.

Re Osoba

Note: This is not a purpose trust case — it is included here to show the contrast. What looks like a purpose trust was saved by construing the purpose as mere motive for an outright gift to identifiable people.

Facts: A Nigerian testator left his residuary estate to his wife "for her maintenance and for the training of my daughter Abiola up to university grade and for the maintenance of my aged mother." The daughter's education had finished and money remained. A son from another marriage argued the trust had failed — the purpose was exhausted so the surplus resulted back to the estate.

Held: No resulting trust. The wife and daughter took the residue absolutely.

Reasoning: The Court of Appeal held that where a testator gives an entire fund to an identifiable person and states a purpose, the purpose is merely the motive for the gift — it does not limit it. The gift is absolute and the beneficiary takes the whole, regardless of whether the stated purpose is exhausted. The court will not impose a resulting trust if doing so would frustrate the testator's clear intention to benefit specific individuals. The fact it was in a residuary clause reinforced this — intestacy would have been an absurd result.

Principle: Where a purpose is stated as motive for an outright gift to an identifiable person, the purpose does not limit the gift. The beneficiary takes absolutely. Distinguish from a true purpose trust where the purpose is the object of the trust itself rather than a reason for making a gift to a person.

PQ use: If a gift is expressed as "to X for the purpose of Y" — ask whether X is an identifiable person who takes the whole fund. If so, Re Osoba says Y is merely motive and does not limit the gift. If the purpose fails or is exhausted, X still takes. No resulting trust arises.

On the familial relationship

Yes it was relevant but not determinative in itself. The court's primary focus was on construing the testator's intention — did he mean to make an outright gift to these people with the purpose as mere motive, or did he mean to limit the gift strictly to the purpose? The family relationship supported the inference that he intended to benefit them personally and generously rather than create a strictly limited purpose fund.

The answer is that a purpose trust arises when there is no identifiable person taking beneficially at all. —> but here there is an identifiable person so they resort to callling it a gift instead of a purpose trust to save it??