DEDICATION
3. An Alternative Approach
In this complex area of law, there are two contradictory principles in play. On the one hand, it is established that gifts that (i) fail subsequent to vesting, or (ii) were at some point in time hypothetically possible to effect, are perpetually dedicated regardless of the donor’s intention. Yet on the other hand, an opposing rule is established that donors can oust dedication by (i) technical drafting of a determinable interest, or (ii) by evincing a particular charitable intention. This contradiction reveals an underlying artificiality in the law. It is blind to donor intention in some cases, only to effect it others.
In Scotland, an alternative approach has developed that has potential to avoid this contradiction. In that jurisdiction, it is possible to ‘wait and see’ whether or not the trust will fail before holding that the property is permanently vested in charity. If after the end of the perpetuity period, it becomes impossible to effect donor intention, the gift us is not automatically dedicated. The court retains a discretion.
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The rule was developed in the Inner House case Cuthbert’s Trustees v
Cuthbert.48 Lieutenant-Colonel Thomas Wilkinson Cuthbert, who resided in a
stately home named Badcall, left the building to provide a holiday home for nurses. It was envisaged that the women would pay to stay and that the costs would cover the maintenance of the property. At a hearing in 1938, the testator’s next-of-kin had raised an objection claiming that the scheme was uneconomic and incapable of fulfilment. Lord Keith had taken an innovative approach. He held that while it would be costly to fully enquire into practicability, that if the trustees were to attempt to carry out the scheme and find it impracticable, then the gift would still lapse. This amounted to an experiment; the gift could be trialled.
In the event, it was not economic to run Badcall as a holiday for nurses; it was remotely located, attracting only relatively small numbers, and it was expensive to maintain. When the next-of-kin brought a claim, Lord Guthrie held that in light of events, the gift had in fact been impracticable from the start. It had never vested. He stated:
…the bequest has been shown by experiment to be incapable of receiving practical effect, because of geographical, financial, and other
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circumstances… Accordingly, in my opinion, [the disposition] has never “taken effect”.49
This experimental approach avoids the contradictions found in English law. Scottish law has found a flexible and discretionary compromise between perpetual dedication and intention construction. A trial is permitted, but if that experiment fails, dedication is not automatic; the court retains control of the eventual destination of the gift at the end of the trial. Consequently, there is no artificial division between those cases where the law is blind to intention, and those cases where it seeks to effect it. The court can decide on a case-by-case basis.
Despite the advantages of the principle, a later Outer House authority,
Edinburgh Corporation v Cranston’s Trustees,50 has given Cuthbert’s Trustees a restrictive reading. In Edinburgh Corporation, a gift was left for twelve poor tailors, but on condition that they were temperance society members. A first instance court allowed the trustees to ‘experiment’ and attempt to find the requisite number of trustees. However, it proved very difficult to find suitably qualified individuals, and after intensive efforts, just two poor tailors were found. This left ten out of twelve parts of the gift unused. Consequently, in the Outer House, the trustees claimed that after a failed Cuthbert’s Trustees type experimentation, the gift had lapsed owing to a lack of a beneficial class.
49Ibid 318 50 (1960) SC 244
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Despite prima facie similarity between the two cases, the trustees in Edinburgh Corporation were not able to persuade the Court that there had been a lapse following the experiment. The Outer House held that the trustees’ success in finding two poor tailors was sufficient for the trust to have ‘taken effect’. Lord Guthrie, apparently attempting to restrict the case to its facts, stated directly in relation to gift of the manor house in Cuthbert’s Trustees:
That was a case in which the facts were very special.51
And he further held:
In Cuthbert’s Case and in the present case, the practicability of the bequest was put to the test of experience, but this certainly does not mean that that course should always be followed. These cases were somewhat exceptional, and it is more usual to find the question of practicability decided at the opening of the bequest.52
While the Outer House did not directly overrule the ‘wait and see’ approach, it is at best a luke-warm treatment of the innovation. And in the long period following the decision, no further Scottish cases have implemented a trial. However, it would be unfortunate if the innovation were to wither on the vine unacknowledged by other jurisdictions. The rule in Cuthbert’s Trustees, points the way for the development of a coherent case-by-case treatment of intention.
51Ibid 254 52Ibid
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It side-steps the artificial division between those cases where intention is effected and those where it is not. In its place, the rule allows a practical compromise between intention and workability in any given set of facts.
4. Conclusion
The law relating to perpetual dedication is of foundational importance in relation to the law’s treatment of intention. It governs the circumstances in which donors can control their property. But the rule is contradictory. There are two opposed lines of cases: those in which the law is blind to donor intention and those in which it strives to effect it by permitting lapse.
Scottish innovation points the way to a coherent role for intention. In place of an artificial ‘either/or’ approach to dedication, the rule in Cuthbert’s Trustees
allows for case-by-case decision-making. Rather than forcing the court to choose between ‘blindness’ to intention and ousting dedication entirely, it permits a trial of the gift’s practicability. For the length of the perpetuity period, the courts can ‘wait and see’. If it transpires after such an experiment that the gift as donor intended it is not practical, then dedication is not automatic. The court retains a practical discretion over the eventual destination of the gift.
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CHAPTER SIX: ‘BALANCED VARIATION’ AT THE CY-PRES