Residual Category
Residual Category
The fourth or residual class of recognised charitable object, refers to trusts for other purposes beneficial to the community. Whereas trusts for education, relief of poverty and religion are presumed to be for the public benefit, this does not apply to this latter category. It is not enough that the purpose is for the benefit of the public.
Trusts in the fourth category must be for the public benefit generally or be for the benefit of a particular part of the public or community. The part of the public must be significant. It should not be merely for the benefit of a limited class, such as the extended relatives of the settlor (person creating the trust) or the employees of a company.
A wide range of trusts have been upheld as potentially beneficial in this context. Trusts for communities, hospitals, the aged, the disabled, sick, sporting or recreational bodies for the benefit of the locality have also been upheld in this category.
Nature of Purposes
Difficult questions may arise as to whether a trust is of sufficient benefit to the public, in order to qualify in the fourth category. Traditionally, a trust falling into this category must fall broadly within the spirit and intent of charitable uses and purposes as contemplated in the preamble to the (repealed) Elizabethan Charitable Uses Act.
A trust is not charitable simply because it benefits the community. Mere public benefit is not enough. It must be for the relief of poverty, education, religion, or some other similar public benefit, which has been recognised by the courts or is analogous to a purpose which has been recognised.
The gift must fall into certain broad categories or analogous cases. The residual category is sometimes measured by reference to the intent and spirit of the abovementioned statute.
2009 Reforms
The legislation preserves the pre-existing definition of a charity as set out otherwise.
The 2009 Act specifically clarifies that the following are deemed to be of public benefit and are thereby charitable:
- Advancement of community welfare including relief as those in need by reason of youth, age, ill health or disability;
- Advancement of community development rural or urban generation;
- Promotion of health including prevention of sickness, disease or suffering;
- Promotion of civic responsibility or voluntary work;
- Promotion of religious or racial harmony and harmonisation of commuter relations;
- Protection of the natural environment;
- Advancement of environmental sustainability;
- Advancement and sufficient effective use of charitable organisations property;
- Prevention of or relief of suffering of animals;
- Advancement of art and culture heritage of scientists;
- Integration of disadvantaged and promotion of their participation in society.
Subjective Approach to some Extent
Where there is public controversy on a matter, the question as to whether the purpose is beneficial to the public is measured subjectively, to some extent, in Ireland. Where the person making the trust considers it beneficial, the court will endeavour to take a neutral stance.
Although a subjective recourse may be permissible, less latitude is given than in the case of religious trusts. The court must be satisfied that the matter is of benefit and importance on an objective basis. It must not be irrational, unlawful or immoral. The objection is that trusts could be otherwise made for fantastic objects that have very little merit and substance.
Gifts in the residual category may be too vague to be given effect even under the above principles. However, the courts and later statute have endeavoured to save charitable gifts where there is a charitable intention.
Residual Ground / Limits
Gifts to assist, maintain, old or/and aged and disabled persons have long since been upheld. Gifts for the purpose of repair of hospitals have been upheld. Hospitals may qualify, even though they charge fees to some patients. Even where a hospital or nursing home is fully fee-paying, it may still be upheld as charitable where it is running enough for classification on this basis.
Trusts for the benefit of science and medical science may be charitable. Where they are for the benefit of a particular professional organization, they may not qualify.
Charities to provide recreation have historically not been looked upon favourably. Recreational activity has been seen as less meritorious than other categories.
On the other hand gifts for the benefit of a particular locality or for the maintenance of parks for public use have been upheld as charitable. Gifts of recreational facilities which are not devoted exclusively to charitable purposes have not been, have, may not qualify.
Public Benefit
A trust for the benefit of a group of employees and associates of a particular company, even a very large one, is unlikely to be held to be charitable. Similarly, a trust which benefits a wide category of relations is insufficiently public in nature in order to qualify as a charity.
However, it appears that there may be differences of approach, depending on the purpose of the trust. It would appear that a trust for the relief of poverty will be allowed in respect of a much narrower category of person than, for example, a trust for the purposes of education.
A trust may be sufficiently public if it is for the benefit of the inhabitants of a particular locality. The fact that it is limited to members of a particular club or members of a particular association, will not necessarily disqualify it.
It is not enough that the purpose is for the benefit of the inhabitants of a particular locality. Its purposes themselves must be charitable. If it falls into one of the recognised categories of charity, it will be more readily assumed to be for the public benefit, until the contrary is shown.
In respect of the residual category of trusts, the criteria of public benefit or benefit to the community is a necessary, though not necessarily sufficient condition, for the trust to be charitable. It need not benefit the community as a whole, and indeed, it rarely will. However, it must benefit a section of the community, who must not be negligible in number and who must not be traced by reference to a relationship to a particular person or organisation.
Purpose Trusts
Generally, trusts for a particular purpose which do not qualify as charitable and are void.
Gifts for the maintenance of particular animals do not qualify at common law. In contrast, trusts for the maintenance and welfare of animals generally have been upheld.
However, the Charities Act specifically allows trusts for:
- erection and maintenance of monuments or graves;
- trusts for the benefits of clubs and bodies which are interpreted as a gift to the association with the requirement to to apply for charitable purposes;
- trusts for the maintenance of particular animals.
Political Purposes
Trusts for political purposes are denied charitable status. Gifts for political parties and for political purposes are not charitable. In England, a gift for Amnesty International was held to be non-charitable on the grounds that it is political in nature.
Gifts principally for the purpose of relief of poverty and advancement of education in developing countries may be invalidated if their purposes extend to political purposes.
Trusts for the promotion of vegetarianism have been upheld in Ireland. Trust for an antivivisectionist society was held invalid albeit many years ago, in England.