Deck 13: Cy-Près: Redistributing Funds and Changing Purposes

Question 1

Which of the following examples would not be considered to be examples of the initial failure of a charitable gift?

A) A gift by will of the testator's residuary estate to establish a full fees scholarship at Oldcastle University when specific gifts have exhausted all but £5000 of the testator's estate.
B) A gift by will of the testator's residuary estate to establish a full fees scholarship at Oldcastle University when no university of this name has ever existed.
C) A gift by will of the testator's residuary estate to establish a full fees scholarship at Oldcastle University when that university ceased to exist five years before the testator's death as a result of a merger with Oldcastle Metropolitan University to create Oldcastle New University.
D) A gift by will of the testator's residuary estate to establish a full fees scholarship at Oldcastle University when that university ceased to exist five years before the testator's death as a result of its dissolution as a higher education corporation.

Answer 1

A , B

Question 2

Rocky, in his will, left £100,000 to 'Mountchapel Prostate Cancer Support Group to assist in its invaluable work in providing advice and practical support for men with prostate cancer.'
In which of the following circumstances is it likely that the gift would take effect notwithstanding that there is no longer a group with this name in existence (more than one may apply)?

A) There has never been a group by this precise name. There is an unincorporated association called Mountchapel Cancer Support Group. This provides advice and support for men with prostate cancer, but also for any other person with any other type of cancer.
B) There has never been a group with this name, or any similar name.
C) The Mountchapel Prostate Cancer Support Group wound up and was dissolved a year before Rocky's death.
D) The Mountchapel Prostate Cancer Support Group agreed a year before Rocky's death to amalgamate with the Mountchapel Cancer Support Group, and this decision was put into effect a month after Rocky's death.

Answer 2

A , B

Question 3

The Sodor Railway Trust (a registered charity) has been raising money for the rebuilding of the Sodor coastal line, a steam and heritage railway project estimated to cost about £10 million. When the Trust had raised about half of this sum, a massive landslide made the project completely unviable.
Which of the following statements about the money raised by the Trust is least accurate?

A) The Trust is not entitled to receive a legacy from Rocky, who had promised to make a gift in his will, and who died a month after the landslide.
B) The Trust is obliged to return to the original contributors any money raised through cash deposited in collecting boxes to the extent to which such contributors can be identified.
C) The trust is not obliged to return any funds to any contributor who was told before the donation that in the event of the project failing, the funds would be applied to alternative charitable purposes.
D) The trust must return larger donations to any donor who can be identified, using advertisements and inquiries if necessary.

Answer 3

B

Question 4

Which of the following would be treated as cases of subsequent failure (more than one applies)?

A) Funds remaining when a charitable trust set up to erect a statue has completed its work.
B) Assets held by a gun club which was originally established for charitable purposes, but which has been informed by the Charity Commission that its purposes are no longer considered to be charitable.
C) Funds held by a trust to provide grants to meet the medical needs of servicemen who served in Burma during the second world war, when, after advertisements in four successive years, no surviving servicemen can be found who would benefit from a grant.
D) Funds originally held on trust by Oldcastle University to make grants to students studying at the Oldhampton city campus. Oldcastle University and Oldcastle Metropolitan University merged last year to form Oldcastle New University, and the Oldhampton city campus was closed as part of the merger.

Question 5

Which of the following would not be treated as situations where a cy-pres application would be permitted?

A) A trust established in 1900 to provide a grant of £100 annually to the Vicar of Oldcastle, to be used by him to meet the needs of poor people in the parish. The trust has funds which now produce an income of £50,000 annually.
B) A trust established in 2004 to support an event to be held on 11 November 2018 to commemorate the centenary of the Great War (the First World War, 1914 to 1918). After the event has taken place, funds of £350,000 remain.
C) Two trusts to provide support for individuals suffering from age-related macular degeneration for patients at the Nightingale and Lark hospitals respectively after the ophthalmic services at both hospitals have been transferred to the new Oldshire University Hospital.
D) A trust to provide free meals to those in the city of Oldcastle in need of such support. The publicly elected Mayor of Oldcastle has a policy of discouraging vagrants, and is putting pressure on the trustees to discontinue the provision of meals because this, in her view, encourages vagrancy.