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High Court of Australia |
THE ROYAL SOCIETY FOR THE PREVENTION OF CRUELTY TO ANIMALS, N.S.W. v.
BENEVOLENT SOCIETY OF N.S.W. [1960] HCA 4; (1960) 102 CLR
629
Settlement
High Court of Australia
Dixon C.J.(1), Kitto(2), Taylor(3), Menzies(4) and Windeyer(5) JJ.
CATCHWORDS
Settlement - Construction - Trusts - Land and houses - For use of society - Sum of money - Interest to be applied for general purposes of society - Conditions attached to trusts - Gift over upon non-compliance with conditions to second society - Charitable purposes - Validity of trusts.
HEARING
Sydney, 1959, September 1, 2, 4, 7;DECISION
February 22, 1960.2. The controversy arises under an indenture made on 30th September 1932 between one Robert James Douglas Sellar as settlor and the Perpetual Trustee Company (Ltd.) as trustee. The property which under the deed Sellar placed in the trustee's hands consisted of two adjoining but detached cottages at Manly and a sum of 10,000 pounds. Some account of Sellar including some references to the deed will be found in the reports of two cases decided in this Court not very long after Sellar's death, Brunker v. Perpetual Trustee Co. (Ltd.) [1937] HCA 29; (1937) 57 CLR 555 and Brunker v. Perpetual Trustee Co. (Ltd.) (No. 2) [1937] HCA 76; [1937] HCA 76; (1937) 59 CLR 140 . But the facts they disclose form only a background to the indenture and do not otherwise help in the decision of the present case. (at p639)
3. In September 1932 Sellar, an elderly bachelor, owned two cottages fronting Bower Street, Manly, side by side. They were then numbered 6 and 8. Sellar resided in No. 6; No. 8 was unoccupied. The land forming the site of the two cottages amounted in area to half an acre. It stretched from Bower Street to the edge of the cliffs overhanging the sea front. At the rear of one of the cottages Sellar had established a bird bath. Some of the Indian doves familiar in Sydney drank there; apparently he thought they were native doves. Other birds also drank there occasionally. He fed the birds with grain and this is said to have attracted them. The indenture with which these appeals are concerned reflects these habits of Sellar. In it may be seen an attempt to ensure that the two cottages should be kept up in perpetuity under the name of the Sellar Sanctuary for Birds, that this should be done by the Royal Society for the Prevention of Cruelty to Animals and that so long as he, Sellar, lived he should remain there but in the guise of a manager, nominating his immediate successor. The general plan of the deed may be said to be to invest in the trustee the trust property, that is to say the land with the cottages and the 10,000 pounds, then to allow the Society for the Prevention of Cruelty to Animals to occupy and use the cottages and land under the name The Sellar Sanctuary for Birds for the general purposes of the Society, provided the Society kept the premises in repair, paid the rates and taxes, kept the premises insured, employed the manager and staff and that the manager and staff kept the sanctuary clean and in repair, encouraged the birds, and watered and fed them. The interest of 10,000 pounds was to be paid to the Society but not applied to the costs of fulfilling these purposes but generally. On any default in performance of the conditions the Benevolent Society of New South Wales should become entitled to the trust property including the 10,000 pounds. (at p640)
4. At present the cottages are vacant and in disrepair, the so-called sanctuary is neglected, there is no manager or staff and it would seem that if the plan of the deed were effective the Benevolent Society would take. However, the Society for the Prevention of Cruelty to Animals says the question whether the conditions have been performed is one of fact not now before the Court and if the question were before the Court the Society could make an answer; what answer by no means clearly appears. But the Society maintains that in any case the issue can never arise because, as it contends, the conditions to be performed are void for uncertainty or as seeking to impose duties on the Society beyond its powers to execute, so that the Society takes free of the conditions; if the conditions be part of the trusts, then it is free of them as trusts inasmuch as they are trusts for non-charitable purposes superadded to a main trust for the society's general purposes which, it says, are charitable. On the other hand the Benevolent Society in its appeal maintains that it is a simple case of a breach of a condition imposed upon a charity and thereupon a gift over to another charity, the possible remoteness of the gift over not mattering because the donees are both charities: cf. Christ's Hospital v. Grainger [1848] EngR 89; (1849) 1 Mac & G 460 (41 ER 1343) . The estate of Sellar is represented by residuary legatees (the trustees of the deed being also executors of the will) and they claim that the trusts of the deed are invalid and that the trust estate and fund results to the estate. (at p640)
5. The conclusions I have reached may be summarized as follows: [1848] EngR 89; (1849) 1 Mac & G 460 (41 ER 1343) It appears to me that the trusts declared by deed as those upon which the trustee holds the so-called Sellar Sanctuary for Birds are for purposes which involve the occupation of the land by the Society and the performance by the Society whether by itself or the manager of the conditions and that all this forms part of the definition of the trust upon which the trustee holds. (2) For the trust to be valid I think that the purposes so involved must be all charitable and in my opinion that requirement is not fulfilled. (3) The trusts upon which the sum of 10,000 pounds is to be held are dependent upon the trusts of the so-called Sellar Sanctuary for Birds and must fail with the latter trusts. (4) The failure of these trusts involves the failure of the trust by way of gift over in favour of the Benevolent Society of New South Wales. Whatever may be the authority of In re Tyler; Tyler v. Tyler (1891) 3 Ch 252 these conclusions place the present case outside the application of anything it contains and I shall say no more about that decision. (at p641)
6. To explain the grounds for the conclusions I have stated it is necessary to describe, and to discuss to some extent, the terms of the deed. (at p641)
7. After stating the parties, namely, Sellar as settlor and the Perpetual Trustee Company as trustee, the indenture begins with a recital of a transfer of the two cottages to the trustee and of an intention to pay to the trustee the sum of 10,000 pounds. Together they are to be called the "trust fund". The recital concludes by stating that the settlor is desirous of declaring the trusts thereof in manner thereinafter appearing. Then follow eight numbered clauses in the first of which there is a mandatory direction that the trustee shall hold the lands (thereinafter called "the sanctuary") upon trusts the terms of which are of basal importance. The sanctuary is to be held upon trust to permit the same to be appropriated occupied used and enjoyed by the Royal Society for the Prevention of Cruelty to Animals, New South Wales, in perpetuity under the name of The Sellar Sanctuary for Birds as and for its general purposes in conformity with the provisions of these presents but subject to the conditions thereinafter mentioned. These not very precise expressions appear to me to define the trust on which the trustee is to hold the cottages. They mean that the occupation, use, etc. which in execution of the trust the trustee is to permit is to conform with the provisions of the deed and be subject to the conditions which thereinafter are mentioned. Subject to that the occupation use etc. of the lands is to be for the general purposes of the Society. The words "general purposes" are not in themselves restrictive; their significance is really only to show that the registered company may occupy use etc. for any advantage it may obtain so long as the Society carries out the functions which the deed describes and which are confided to the Society so as to maintain the cottages and land as the Sellar Sanctuary for Birds. One can hardly regard the words "for its general purposes" as adding anything to a simple provision in favour of the Society as a corporation. But if one likes to treat that as leaving the Society with a beneficial right to occupy use etc. it is all postponed to the paramount requirement laid down by the provisions of the deed to carry on the premises as what Sellar, the settlor, described as a "Bird Sanctuary". Clause 4 directs the trustee to pay the annual income of the investments of the 10,000 pounds for its general purposes and permit the Society to use occupy enjoy and appropriate the "Sanctuary" for its general purposes "as aforesaid whilst and so long as the said Society shall observe and perform the following conditions". Then are set out a number of requirements which the Society must fulfil. It must well and sufficiently repair maintain amend and keep the said sanctuary with the appurtenances in good and substantial repair and so on. Rates and taxes must be paid. A widely defined cover of insurance must be maintained. Then it must pay or provide all costs charges expenses and outgoings of and incidental to the maintenance and management of the sanctuary and the salaries and wages of "all managers housemaids gardeners and all servants and workmen" who shall be employed in and about the sanctuary. It must do all such works and things as may in the opinion of the trustee be from time to time necessary or desirable for such purposes and in executing the trusts and powers contained in the deed. It must employ keep and maintain upon the lands a manager and all other necessary servants gardeners or workmen for the purposes aforesaid. They must be approved by the trustee and employed at a weekly salary or wage agreed upon by the trustee and the Society. The trustee or Society may terminate their engagement. All this must be done at the expense of the Society, paid otherwise than out of the income of the trust fund. It may be remarked that from an accounting point of view there cannot be much sense in this provision. The Society obtains the income of the trust fund and it makes the expenditure, but the point of the provision probably lies in a hope that the duties of the Society will be regarded as dependent upon conditions of occupation etc. rather than upon any trust imposed upon the Society. If this be so it may explain the provision but it cannot prevent the whole expression of the duties of the Society forming part of the trust upon which the trustee holds the land. The duties of the manager are set out but at the end of the catalogue there is a provision that the due performance of such duties should be one of the conditions on which the Society shall be entitled to the use occupation and enjoyment of the sanctuary and to be paid the said income. The manager is to have the control of the servants workmen and others from time to time employed and his duty is to keep the sanctuary clean and in good and habitable condition including in particular the grounds and the lawns and the fountain at present erected in the grounds. He is to permit and encourage all Australian native birds including the supposedly native doves to come and drink at the fountain at all times. He is to feed or cause to be fed all visiting birds three times a day at hours particularly prescribed for winter and summer. The expression "visiting bird" seems to mean nothing but a bird which comes within the half acre of land forming the sanctuary. The quantity of wheat, grain or seed is specified: it is fixed according to what at the then current market cost a 1 pound a week would buy. There are one or two other provisions which should be mentioned. One prohibits the Society from leasing assigning transferring demising or parting with the possession and so on of the premises without the consent in writing of the trustee. The only importance of this is that it might be construed as implying that with the consent of the trustee the Society might lease etc. the premises. What the draftsman had in mind it is difficult to say but it is impossible to suppose that there is an implied power under which the Society might terminate the whole of the obligations resting upon it by leasing the premises. There is a provision that the Society shall not have upon the premises any animals birds fish or other classes or kinds of living things not approved by the trustee. A power is conferred upon the trustee with the consent of the Society to sell the sanctuary or any parts thereof but the proceeds are to be held upon trust to purchase another property which in the opinion of the trustee is suitable for the purposes for which "the Sanctuary shall theretofore have been used by the Society in the place and stead of the Sanctuary" and the property so purchased is to be held by the trustee upon the same trusts as are declared in the deed in respect of the sanctuary. How exactly this would operate is not clear. There is a provision exonerating the trustee from enquiring whether the Society has performed the conditions and exonerating it from any loss occasioned to the Benevolent Society by reason of the Society being allowed to remain in occupation and in receipt of any moneys payable under the deed. But the exoneration does not extend to wilful neglect or default of the trustee. The provision is of little importance for present purposes but it does confirm the view that the conditions formed part of the definition of the trusts upon which the trustee holds. The gift over is expressed in cl. 5 which provides that if and so soon as the Society shall make default in complying with the stipulations and conditions hereinbefore contained or any of them the capital and income of the trust fund shall be held in trust for the Benevolent Society of New South Wales for its general purposes. To this there is a proviso excepting the neglect or omission of the manager to perform his duties if without the consent or permission of the Society and excepting the accidental neglect or omission of the Society to perform the conditions. (at p644)
8. It appears to me that if valid the effect of the foregoing provisions would be to create a trust for purposes which it is the duty of the trustee to cause to be carried out. Notwithstanding the exoneration from liability for failure without wilful default it is the trustee's duty to see that the so-called sanctuary for birds is maintained and that the purposes as defined are fulfilled. Both the Benevolent Society and the Royal Society for the Prevention of Cruelty to Animals claim that the purposes of the latter Society fall within the conception of charity for the purposes of the law governing charitable trusts. The contention is necessary to the case of the Benevolent Society because otherwise the doctrine that a gift over from one charitable purpose to another falls outside the rule against perpetuities might not apply. Each is a company incorporated under the law of New South Wales and whatever rights may be conferred upon either of the respective Societies belong to the Societies in virtue of their corporate character. It may be assumed that the doctrine of Christ's Hospital v. Grainger [1848] EngR 89; (1849) 1 Mac & G 460 (41 ER 1343) applies to bodies incorporated under the Companies Act for purposes in fact charitable as much as it does to bodies incorporated by Royal Charter for such purposes: Royal College of Surgeons of England v. National Provincial Bank Ltd. (1952) AC 631, at pp 637, 638, 647-650, 662, 663, 666, 667 . This, however, is a question which does not arise in the view I take of the present case. It appears to me to be clear enough that the character of the so-called bird sanctuary as described in the indenture is not charitable. One may be pardoned for thinking that perhaps the benefit of the settlor and of the person to be appointed manager upon his death were not left out of account in framing the provisions of the deed. But however that may be the crude and trifling directions to provide food and water for birds afford no sufficient ground for treating the trusts of the deed as charitable. When the directions contained in the deed are looked at closely there is really no more. The high sounding description Sellar Sanctuary for Birds and the references to a manager and staff cannot be allowed to distract attention from the fact that after all the provision in favour of birds does no more than require that a relatively small area of suburban land near the sea coast shall remain accessible to birds and that there shall be food and water for them. The place, the climate and the nature of the cottage sites, makes the idea absurdly fanciful but in any event it has none of those tendencies which nowadays are demanded as a justification for treating trusts directed to the benefit of animals as valid. See In re Grove-Grady; Plowden v. Lawrence (1929) 1 Ch 557 , Re Moss (1949) 1 All ER 495 . As I have already said, the consequence is that the trusts in favour of the Royal Society for the Prevention of Cruelty to Animals cannot be sustained. It is, in my opinion, impossible to treat it as a trust in favour of the Society independently of the conditions upon which the Society takes. These conditions form clearly enough a part of the trust the execution of which through the Society is imposed upon the trustee. (at p645)
9. The difficult question remains of the position of the Benevolent Society. Can the gift over operate in its favour, the provision in favour of the bird sanctuary being void? So to construe the deed would mean that instead of the gift over being a provision to take effect only on the default of the Society it would become a substitutional provision to take effect in all conditions should the earlier provision fail. The words of cl. 5 are "if and so soon as the Society shall make default in complying with the stipulations and conditions hereinbefore contained or any of them". The provision supposes a valid obligation or quasi obligation upon the Society in the fulfilment of which the Society makes default. To accelerate, so to speak, the gift over simply because of the invalidity of the earlier gift would be to disregard the actual meaning of this expression and to imply an intention which the words do not disclose. To do this would violate the presumptive rule which governs the construction of gifts over upon a contingency and would naturally apply to a contingency consisting in a default. The presumption is that the gift over will not take effect unless the very contingency occurs: see In re Bailey; Barrett v. Hyder (1951) 1 Ch 407 and the cases there cited and discussed and Macpherson v. Maund [1937] HCA 78; (1937) 58 CLR 341, at pp 348-350 . The application of the prima facie rule means that the gift to the Benevolent Society cannot take effect. The result is that there has been a resulting trust in favour of the estate of Sellar. It follows that the view expressed in the decretal order of Hardie J. is correct. (at p645)
10. During the hearing of the present appeals it was noticed that the legatees, namely, Guy Fisher, Lady Hilda Madeline Britton-Jones and Matilda Gertrude Mabel Warden, although appearing before this Court upon the hearing of the appeals in pursuance of the notices of appeal, had not been sued as representing the estate. They are not mentioned in the body of the originating summons. Our order disposing of the appeals should include a provision rectifying this omission. The appeals should be dismissed with costs. (at p646)
KITTO J. I agree. (at p646)
TAYLOR J. In my opinion these appeals should be dismissed. I have had an opportunity of considering the reasons prepared by the Chief Justice and I entirely agree with his observations and have nothing to add. (at p646)
MENZIES J. The facts in this case have been stated in the judgment of the Chief Justice, with which I agree but to which I would add a word or two of my own. (at p646)
2. The limited decision sought from the Court upon these appeals is whether the trust in favour of the Royal Society is valid, and, if any condition of that valid trust has been broken, whether the trust property passes to the Benevolent Society. Both the Royal Society and the Benevolent Society - whose expectations depend upon showing default by the Royal Society in the performance of a valid trust - have therefore sought to sustain the trust established by the settlor according to the letter of the deed. The Royal Society also contended that although the trust in its favour was valid, the conditions annexed thereto were invalid. Hardie J. decided that the trust was invalid because it was perpetual and non-charitable. (at p646)
3. Even if it be that a trust for the general purposes of the Royal Society is charitable, I have come to the conclusion that this trust is not of that character but is confined to its general purposes "in conformity with the provisions of these presents", to use the language of cl. 1, or "whilst and so long as the said Society shall observe and perform the following conditions", to use the language of cl. 4, so that both the occupation of the block of land at Manly with a couple of cottages upon it and the receipt of the annual income of the investments are, as part of the trust, made to depend upon the maintenance of the property as a bird sanctuary, which in the context of the deed means no more than that a manager and staff should be employed to keep the land and fixtures in order, to provide there water and food costing one pound a week for "visiting" birds, and to keep the birds free from molestation while drinking or feeding. I am far from deciding that the maintenance of a genuine wild life sanctuary would not be charitable; but to do no more than provide upon a suburban allotment water and some food for birds, or, for that matter, for dogs or cats, seems to me to fall altogether outside the scope of a trust for the public benefit within the fourth category in The Commissioners for Special Purposes of the Income Tax v. Pemsel [1891] UKHL 1; (1891) AC 531 which requires not only a trust "to benefit animals" but also thereby to "elevate the moral character of men", to use the language of Lord Simonds in National Anti-Vivisection Society v. Inland Revenue Commissioners [1947] UKHL 4; (1948) AC 31, at p 65 . A mind alive to natural impressions will no doubt find "tongues in trees, books in the running brooks, sermons in stones"; but it is difficult to believe that even to the most sensitive mind, the provision of water, a modicum of food thrice daily at stipulated hours and freedom from interruption for birds drinking and eating would bring any moral elevation. The natural reaction to the settlor's trust is not "How kindly and worthy of emulation]" but "How odd] What is the explanation of this?". (at p647)
4. I agree that these appeals should be dismissed. (at p647)
WINDEYER J. I have had the advantage of reading the judgment of the Chief Justice. I respectfully agree in thinking that the decision of Hardie J. was right. The deed seems to have been drawn with Re Tyler ; Tyler v. Tyler (1891) 3 Ch 252 in mind. But I agree that that case really has no bearing on the present question; for the deed upon its true construction creates a trust for what the settlor described as a bird sanctuary. The terms of this trust itself are, I think, to be found in the so-called conditions. If, thus defined, the trust be not a valid trust - and no one has contended that it is - then the foundation of the whole scheme fails, and the gift over the Benevolent Society falls with the rest. That is what has happened. (at p647)
2. I do not mean to suggest that a trust to set up a bird sanctuary in what may perhaps be called the proper sense of that term could not be a good charitable trust. A trust for the provision and preservation of a sufficient area of bushland or of inland water, marshland or sea-coast, suitably situated, as a place where birds could breed unmolested might well, I would think, be good. In most parts of Australia there are laws for the protection of certain species of birds. In New South Wales this policy began with the Animals Protection Act of 1879 which listed certain kinds of birds as protected and provided for the addition to the list of others "known to be destroyers of snakes vermin or insects which are injurious to vegetation". It also enabled the dedication or setting apart by the government or private persons of sheets of water or areas of land as places for the preservation of birds. The policy was carried further by later legislation, the present Act being the Fauna Protection Act 1948. The basis of this policy is the belief that it is for the good of the community that various species of birds should be preserved; and that - especially in the case of some of the more timid native birds - positive measures are needed for their protection and preservation. In relation to animals the law of charity seems to have the same basis as the Puritan's hostility to bear baiting had according to Lord Macaulay. It is not the good of the animals so much as the material and spiritual welfare of men that is to be considered. But some birds are in a material sense useful to man. Others by their appearance, their melody or because of the interest of studying their ways contribute to men's happiness. Trusts in aid of the preservation of birds could, I think, thus be for a purpose useful to the community and have the qualities necessary to make them charitable trusts. The decision in In re Grove-Grady ; Plowden v. Laurence (1929) 1 Ch 557 is not, I think, inconsistent with this - Lord Hanworth M.R., speaking of the scheme there in question, said: "It is not a sanctuary for any animals of a timid nature whose species is in danger of dying out: nor is it a sanctuary for birds which have almost entirely left our shores and may be attracted once more by a safe seclusion to nest and rear their young" (1929) 1 Ch, at p 573 . And one of the purposes of the National Trust, which was held by Ashbury J. in In re Verrall (1916) 1 Ch 100 to be charitable, was the preservation of places of beauty and of their natural aspect, features and animal and plant life. (at p648)
3. But it is not necessary to decide whether a real sanctuary for birds would be a charity. The purposes here in question fall short of anything of that sort. Mr A.H. Chisholm, who is a distinguished ornithologist, said of the land at Manly: "In the terms as we regard a sanctuary I would say the place is hopeless. It is too small and contains two houses and there is not a great deal of vegetation there". Even without such evidence, a trust for keeping a bird-bath in the back yard or small front lawn of a cottage in a Sydney suburb, and putting out grain there for Indian turtle doves and domestic pigeons to eat, could not be considered a charitable trust. The deed contains a provision for the sale of the subject land and the acquisition of another site in lieu of it; but its terms are such that it carries the matter no further. Many people feed birds. This gives them pleasure and gives the birds satisfaction. But a suburban householder cannot by assuming an obligation to keep a basin filled with water and to put out food for birds convert his home into a public charity of which he can make himself or his nominee the manager. (at p649)
4. I agree that the appeals should be dismissed. (at p649)
ORDER
Appeal in each case dismissed.Decretal order of the Supreme Court varied by inserting an order that Guy Fisher, Lady Hilda Madeline Britton-Jones and Matilda Gertrude Mabel Warden be appointed to defend the application as representing the estate of the deceased.
The costs of the abovenamed Guy Fisher, Matilda Gertrude Mabel Warden, Lady Hilda Madeline Britton-Jones, and of the trustee, viz. Perpetual Trustee Company (Limited) of and incidental to the abovementioned appeals No. 79 and No. 80 of 1958, except in so far as such costs are exclusively referable to the said appeal No. 80, are to be paid by the appellant The Royal Society for the Prevention of Cruelty to Animals and such costs of the said Guy Fisher, Matilda Gertrude Mabel Warden and Lady Hilda Madeline Britton-Jones and of the said trustee as are exclusively referable to the said appeal No. 80 to be paid by the appellant the Benevolent society of New South Wales.
The costs of the trustee, viz. Perpetual Trustee Company (Limited) of and incidental to the said appeals No. 79 and No. 80 to be taxed as between solicitor and client and to be retained out of the fund held under the deed of settlement dated 30th September 1932 except in so far as such costs are recovered by the said trustee under the foregoing order. No order as to the costs of the Attorney-General of the said appeals.
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