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Last updated November 2015

Charity Tribunal Judgement - ACO Press Release

ACO's response following the Charity Tribunal Judgement handed down on 20th February 2012.

For Immediate Release 20th February 2012

ACO responds to Charity Tribunal verdict and applauds “victory for common sense”

The Association of Charitable Organisations (ACO) welcomes the judgement of the Charity Tribunal regarding the status of poverty trusts with restricted groups of memberships.

ACO Chief Executive, Dominic Fox said: “ACO welcomes the judgement. The court has clarified the law and confirmed the right of benevolent funds to charitable status. It is a victory for common sense”.

“The judgement sends a strong signal to the sector that:

  • supports the role of grant making charitable trusts and foundations in determining the public benefit of their activities; and
  • champions the independence of charity trustees.”

He added, “The judges joined ACO in questioning why the Reference was necessary. ACO believes that there should be more consultation at the early stages of any reference to the Charity Tribunal. References are intended to test and clarify the law and ACO believes if the Charity Commission had taken views from ACO the reference would have been better worded. Furthermore our advice as the specialist umbrella body for the sector, would have noted HMRC disinterest and counselled waiting for legal advice from the Attorney General. If these steps had been taken this case might never have reached the court”.

“ACO members can now get on with the job of channelling their funds to people in need, through grants and welfare support services. ACO members collectively provide some £70 million per year in grants to needy individuals and have collective assets of £2 billion. In a time of austerity and rising unemployment their services are needed more than ever. ”

Judges praised the intervention of ACO referring to our collaborative approach bringing together over 20 separate funds, sharing legal fees and cutting down on duplication of legal argument as “helpful”, “perceptive”, “valuable” and providing “insight”.

ENDS

 

The Reference asked the Tribunal to determine the answers to the following questions:

(1) “Whether a trust for the relief of poverty amongst a class of potential objects of the trust’s bounty defined by reference to the relationship of the potential objects to one or more individuals is capable of being a charitable Trust.”

ACO believed the answer to this question was yes. The Attorney General and Judges agreed.

(2) “Whether a trust for the relief of poverty amongst a class of potential objects of the trust’s bounty defined by reference to their or a member of their family’s employment or former employment by one or specified commercial companies is capable of being a charitable trust.”

ACO believed the answer to this question was yes. The Attorney General and Judges agreed.

(3) “Whether a trust for the relief of poverty amongst the members of an unincorporated association or their families is capable of being a charitable trust.”

ACO believed the answer to this question was yes. The Attorney General and Judges agreed.

(4) “Whether Part 1 Charities Act 2006 operates so as statutorily to reverse the decision in any, and if which, of the following cases: …”

ACO believed the answer to this question was No. The Attorney General and Judges agreed.

(5) “Is the nature and extent of the public benefit required in order for a trust for the prevention of poverty amongst a specified class of persons to be a trust for a charitable purpose within s.2Charities Act 2006 (i) the same as that which would be required for a trust for the relief of poverty amongst the same class to be a trust for such a charitable purpose or (ii) different, and if so in what way?”

ACO believed the answer to this question was “the same”. The Attorney General and Judges agreed. Judgement concluded: “This depends on the way the prevention of poverty is to be carried out in accordance with the purposes of the trust concerned.”

Notes for Editors:

ACO (registered charity number 1118605) is the membership organisation for benevolence charities which give grants and welfare support to individuals in need. Members include national, local, occupational and general charities. For more information, contact Dominic Fox on 0207 255 4480, or 0755 737 0683 or email dominicfox@aco.uk.net

Attorney General's Reference CRF/2011/0001
Link: http://www.justice.gov.uk/guidance/courts-and-tribunals/tribunals/charity/references.htm

The Judgement

Icon Attorney General's Ref: CRF/2011/0001

Report

Charity Tribunal Judgement handed down 20/02/12

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