Soton Equity and Trusts - alastairhudson.com

2) The four heads of charity in Pemsel’s Case
"Charity in its legal sense comprises four principal divisions: trusts for the relief of poverty; trusts for the
advancement of education; trusts for the advancement of religion; and trusts for other purposes beneficial to the
community." (Commissioners of Special Income Tax v. Pemsel [1891] A.C. 531, at 583, per
Lord Macnaghten).
Scottish Burial Reform and Cremation Society Ltd. v. Glasgow City Corp [1968] AC 138.
3) The position under the case law before 2006
This approach now simplified by the categorisation adopted by Lord Macnaghten in IRC v.
Pemsel into four principal divisions:-
(i)
(ii)
(iii)
(iv)
Relief of poverty
Advancement of education
Advancement of religion
Other purposes beneficial to the community
See also the Recreational Charities Act 1958
i) Relief of Poverty
What is poverty?
(a)
Preamble to 1601 Act - "aged, impotent and poor people" is now accepted that these
terms may be read disjunctively and thus sufficient if a gift comes within just one of the
categories.
Joseph Rowntree Memorial Trust Housing Association Ltd. v. A-G [1983] Ch
159
(b)
(c)
Poverty means having to go short having regard to the individual's standing in life
The gift must be in terms that exclude those who are not poor. Thus, a trust to provide
"knickers" for boys aged 10-15 whose parents were resident in Farnham was held not
to be charitable on the ground that there was nothing in the terms of the gift to exclude
rich sons. Further, it would seem to follow that a gift would not be charitable if it
excluded the poor, eg a gift to benefit impotent millionaires
ii)
Advancement of Education
Since 1601, the term education has come to include a far wider range of objects than those set
out in the Preamble
(a)
Education of the young
IRC v. McMullen [1981] AC 1
(b)
Research
c) Artistic Pursuits
Re Shaw [1957] 1 WLR. 729
Re Hopkins [1965] Ch 669
McGovern v. AG [1982] Ch 321
Royal Choral Society v. IRC [1943] 2 All ER 101
91