ATTORNEY GENERAL FOR NEW SOUTH WALES v BARR

Court of Appeal (NSW)|1991-02-28|Before: Kirby P, Handley JA, Samuels JA, Hodgson J

ATTORNEY GENERAL FOR NEW SOUTH WALES v BARR SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL

KIRBY P, SAMUELS and HANDLEY JJA 28 February 1991, 11 October 1991 [1991] NSWCA 4

CHARITIES - cy-pres doctrine - gift to institution which did not exist as such - other institution subsequently amalgamated and activities transferred - whether gift vested - whether general charitable Intention disclosed. AG v Public Trustee (1987) 8 NSWLR 5 applied. CHARITY - charitable gifts - failure of object - when applied cy-pres - bequest of entire estate to "Girls" Orphanage, Goulburn"

no such institution - former Girls' Home since amalgamated with Boys' Home - functions after death of testatrix transferred to another institution in a different town

Kirby P The issues in this appeal are: (a) whether the bequest by a testatrix to a charity, no longer in existence as described in the will at the time of her death fails so that the relatives take as on an intestacy; (b) whether the bequest had vested at death in a successor institution, since closed; and/or (c) whether a sufficiently general charitable intention was evinced in the will to permit the Court to order that the trust in respect of the bequest be executed cy pres.

By her will of 19 January 1960, Mrs Alice Cassells (the testatrix) provided, relevantly:

"... Should my said husband predecease me or die without taking out Probate of this my Will THEN I GIVE DEVISE AND BEQUEATH the whole of my estate as aforesaid to the MOTHER SUPERIOR for the time being of the GIRL'S ORPHANAGE GOULBURN for the use of the said Orphanage AND I DIRECT that the Receipt of the said Mother Superior shall be a sufficient discharge to my Trustee..."

The executrix sought directions as to the construction of the will having regard to the changes in circumstances between the date upon which it was executed, the death of the testatrix on 19 October 1987 and thereafter. Most of the facts proved at the trial before Hodgson J were undisputed. There was no "Girls' Orphanage Goulburn" as such, established by that name at the time of the will or, indeed,

afterwards. There was, however, a girls' home in Goulburn run by the Sisters of Mercy whose principal was, at the time of the will, known as the Mother Superior. That home (St Joseph's Girls' Home) took care of orphaned and other disadvantaged girls. The same religious order ran the St John's Boys' Home. The two homes were amalgamated in 1975; ie before the testatrix's death. Operated in that way, under the name of St John's, they were caring for disadvantaged children, including two orphaned girls at the time of the death of the testatrix. It was agreed at the trial that by her will, the testatrix was referring to the St Joseph's Girls' Home by her reference to the "Girls' Orphanage, Goulburn". Subject to what follows, my own inclination would be to hold that, when the testatrix died, the joint children's home of St John's was the successor institution to the charity described by activity, not name, as "the Girl's Orphanage, Goulburn". Upon this view, the gift had vested before the time of the testatrix's death in the trustees who were responsible for that institution. There was therefore no failure of the bequest. Orders should be made accordingly.

However, circumstances later changed still further. The relatives suggested that the change was significant. In December 1987, St John's Home, Goulburn was closed. The children who were then being cared for in the home were transferred to the Marymead Children's Centre in Canberra. That body, like the religious orders which ran the predecessor institutions, is connected with the Roman Catholic Church. The Centre's activities were described by Sister Mary Brown. She was from January 1964 until 31 December 1974 the Sister Superior of the St Joseph's Girls' Home. She described the amalgamation in 1975 with the St John's Boys' Home to produce the St John's Children's Home. She remained the Sister Superior of that Home until December 1987. She deposed to the transfer of the children to the amalgamated institution at Marymead as follows:

"On the 31st December, 1987 the operations of St John's Childrens Home at Goulburn was taken over by the Marymead Childrens' Centre located at Goyder Street, Narrabundah in the Australian Catholic Territory which is controlled by the Trustees of the Roman Catholic Church for the Archdiocese of Canberra and Goulburn and a Board of Management appointed by the Trustees.

I am involved in the day to day administration of the Marymead Childrens Centre where I supervise children and work in the Family Welfare and Childrens' Welfare Section.

Marymead Childrens Centre provides residential accommodation for girls aged between lyear and 17 years and boys from | year to 11 years from families who live in the Australian Capital Territory and the surrounding districts of New South Wales. Through my experience working in St Joseph's Girls' Home, Kenmore, Goulburn, St John's Boys Home, Goulburn and St John's Childrens' Home, Goulburn I believe that the services offered by Marymead Childrens' Centre are the same services as offered by the aforesaid homes in Goulburn. The services of Marymead Childrens 'Centre are wider than the predecessors in Goulburn and in addition to residential accommodation Marymead Childrens' Centre offers Family Support systems and advisory services which were not fully developed in the previous Homes."

Only three further facts remain to be mentioned. The husband of the testatrix predeceased her. By his will, which was admitted into evidence, he bequeathed half of his residuary estate to the testatrix and a quarter each to the Society for the Propagation of the Faith in the Roman Catholic Archdiocese of Canberra-Goulburn and to the Marist Fathers of the Province of Australia. The

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subject will of the testatrix was not a holograph but was drawn by a solicitor. Cf McCormack v Stevens and Ors [1978] 2 NSWLR 517, 518 (SC).

Failed bequests: applicable principles In present social circumstances, it is virtually inevitable that problems such as the present will increase in number. There are two main reasons for this: (a) The lapse of time which frequently arises between the execution of a will (containing reference to particular charitable objects) and the death of the will-maker, giving rise to the necessity to implement as far as possible his or her intentions. The present is not an atypical case. The lapse of time between the will and death was nearly eighteen years; and (b) The speed of social change, causing changes to occur both in the needs for charitable works and in the organisations and institutions which provide support to the objects of charity. Workhouses have given way to hospitals. Cf In re Roberts, deceased; Stenton and Anor v Hardie and Ors [1963] 1 WLR 406. With different forms of treatment and changing social attitudes, lunatic asylums have become psychiatric outpatient centres. Homes for unmarried mothers have been replaced by women's refuges. Separate institutions for boys and girls have given way to amalgamated bodies. Foundling Institutes and Orphanages, as such, are now rare. Today (as common experience teaches) the equivalent social problems are those of the children of marriage breakdowns and runaway children ("street kids").

Factor (a) is inherent in the very nature of wills. Factor (b) has always existed. But in the present circumstances of rapid social change affecting both the objects of charities and the institutions for the provision of charity, it is appropriate to approach some of the earlier decisions on the failure of charitable trusts, with a degree of caution.

Relevant to the present case, I would derive the following principles from those decisions:

The fundamental question in each case is the proper interpretation of the will, derived from its language and from the circumstances which may lawfully be taken into account. See Attorney General for New South Wales v Public Trustee and Anor (1987) 8 NSWLR 550, 554 per Hope JA. Cf Tudor on Charities, 6th ed, Sweet and Maxwell, London, 1987, 261;

Although a scrutiny of other cases may sometimes suggest matters which should be taken into account, little decisive assistance is likely to be obtained from holdings on other wills, written and construed in other circumstances and in earlier times. See Re Roberts, deceased [1963] 1 WLR 406, 415 and Hope JA, Public Trustee Case, ibid, 553;

As a general principle, courts will lean in favour of charity. Upon the failure of a specific gift, courts will be ready to infer a general intention on the part of the will-maker to provide a gift to charity. See eg Attorney General for New South Wales v Perpetual Trustee Co (Limited) (1940) 63 CLR 209, 227; Re Faraker [1912] 2 Ch 488. Little is required in the language of the will for a court to treat a wider purpose as the object of the trust. This attitude is adopted out of respect for the wishes of the will-maker, out of recognition of the considerations of change set out above and bearing in mind the fact that, if the will fails, those who benefit, in most circumstances, are relatives who have inferentially been considered by the will-maker but rejected in favour of charity. The fact that other legal provision is now made to permit certain family members to disturb a will is a further consideration which favours construing the will to achieve, so far as possible, the will-maker's charitable purpose;

Contrary to what is sometimes suggested in earlier English and other Australian authority, it has been established in this Court that there is no rule that a gift to a named charity, which existed at the date of the will but has ceased to exist before death, makes it more difficult to conclude that the testator had a general charitable intention than where the named charity never existed at all. See Public Trustee Case (above) at 554; In re Spence, deceased [1979] 1 Ch 483, 492; cf Re Rymer [1895] 1 Ch 19; Re Tyrie deceased (No 1) [1972] VR 168, 177;

Depending upon the circumstances, the following considerations have been identified as sometimes supporting an inference of a general charitable intention on the part of the will-maker:

(a) if the failed gift is expressed in a way which suggests a charitable intention; see Hope JA, above, 554;

(b) if the failed gift is made in association with a number of other gifts, undoubtedly charitable, which succeed; see In Re Spence (above) 485;

(c) if the whole estate is left to a charity which fails; see In Re Fingers Will Trusts [1972] Ch 286, 296 (Reginald Goff J); and

(d) if admissible circumstances support the conclusion that the will-maker did not intend to benefit the relatives (see Goff J (above)).

In the end, the court's function involves judgment, assessment and impression upon reading the will. The decision is not wholly susceptible to reasoned exposition. This point was made by Sir Robert Megarry V-C in In re Spence (above) at 488-9. In commenting on what he took to be a "puzzling" decision of the English Court of Appeal in In re Lucas [1948] Ch 424, his Lordship said:

"T say what I say with all due humility, and a ready recognition that the fault may be an inability on my part to see what is plain to others; but, though humble, I remain puzzled."

If a general charitable intention is found, the court has a ready facility to frame an order which represents a disposition of the will-maker's bounty in a way close to the gift as it was apparently intended. See McCormack (above) 519. The inhibition upon so providing arises from the fact that it is then the court, and not the will-maker, which has disposed of the property. This represents, in a sense, a failure to achieve precisely the will-maker's expressed intention. But it is done by the court to get as close as possible to that intention and to avoid intestacy (which the existence of the will tends to negative) and gifts to relatives (whom the testator inferentially did not intend to take).

Conclusion: general charitable intention shown I now apply the foregoing principles to the facts of this case. I assume, contrary to my primary conclusion, that the charity did not vest in the trustees of the St John's Children's home at the time of the testatrix's death because there was no institution then in existence complying with the testatrix's bequest. I am then entirely satisfied that the testatrix sufficiently evinced a general charitable intention so as to permit this Court to make a cy-pres order. Indeed, consistent with the approach which Hope and Samuels JJA and I adopted in Public Trustee Case (above) I cannot readily see how a contrary conclusion could be reached in the facts of this case. Perhaps I am suffering from the puzzlement to which Sir Robert Megarry confessed and which derives from attempts to find order in the chaos of individual cases of failed charities, dutifully reported, each on their own peculiar facts.

The features of this case which lead me to my conclusion of a general charitable intention on the part of the testatrix include the following:

URJ ATTORNEY GENERAL FOR NEW SOUTH WALES v BARR (Samuels JA) 5

(i) That the testatrix, like her late husband, clearly proposed to benefit a charity provided by the agencies of her Church, the Roman Catholic Church;

(ii) That she did not propose to benefit her relatives who will take on an intestacy. On the contrary, she adhered to a will providing a bequest to charity;

(iii) That she left the whole of her estate to be disposed of in this way;

(iv) That, as a resident of Goulburn, it may be inferred that she would have known, at least in general terms, of the changes in children's institutions in that city between the execution of her will and her death;

(v) That the will was not drawn by the testatrix herself but by a solicitor.

It did not refer to a named institution but to an "Orphanage'. This suggests, to my mind, a desire to benefit an institution with the charitable purpose of looking after severely disadvantaged children rather than only a specific named Home which the solicitor might readily have described by its exact title;

(vi) That the provision in the will is "for the use of' the Orphanage. This suggests that it was the activities of the body which were to be benefited, rather than the institution as such. Those activities were undoubtedly of a general charitable purpose; and

(vii) That the provision for the receipt by the Mother Superior as a discharge showed (if the testatrix attended to those words) that she had in mind providing her bequest to the Trustees of the Roman Catholic Church of the Archdiocese of Canberra and Goulburn, represented in the case of the "Orphanage" by the Mother Superior, later the Sister Superior.

Too much should not be drawn from any of the foregoing considerations, taken individually. But in combination they sufficiently persuade me that the testatrix did not have her eye set solely on a particular institution, which she did not even name accurately. Instead, her intention was to provide her entire estate for the general charitable purpose of severely disadvantaged children, such as female orphans.

Although catering for a class wider than "orphans", indeed wider than girls, and located in a city other than Goulburn, I am satisfied that the Marymead Childrens' Centre comes sufficiently close to the testatrix's intention to allow the trust declared in respect of the bequest to be executed cy-pres in favour of that Centre.

This Court generally leaves the settlement of a cy-pres scheme to be decided by the Equity Division. Having regard to the size of the estate and its substantial depletion by earlier proceedings, my own preference would have been to favour taking the course which Hope JA adopted in Attorney General v Public Trustee (above).

However, to secure an order of the Court which accords with the highest common denominator of agreement within the Court, I am content to agree with the orders of Handley JA. Cf Woolworths Ltd v Kelly (1991) 22 NSWLR 189 (CA). Handley JA's orders reflect the implementation, although by a different route, of substantially the same conclusion as I have reached. I therefore agree in those orders.

Samuels JA Alice Patricia Cassells (the testatrix) died on 19 October 1987. She left a will dated 19 January 1960 in the following terms:

"THIS IS THE LAST WILL AND TESTAMENT of me ALICE PATRICIA CASSELLS of "Eurimbla" Frogmore in the State of New South Wales Married Woman I HEREBY REVOKE all former Wills and Testamentary Dispositions

heretofore made by me AND DECLARE this to be my last Will and Testament IT APPOINT my husband FRANCIS McLEAN CASSELLS Executor of my Will and unto him I GI(VE DEVISE AND BEQUEATH all my estate both real and personal of whatsoever kind and wheresoever situate for his own sole use and benefit absolutely PROVIDED that should my said husband predecease me or die without taking out Probate of this my Will THEN I GIVE DEVISE AND BEOUEATH the whole of my Estate as aforesaid to the MOTHER SUPERIOR for the time being of the GIRLS' ORPHANAGE GOULBURN for the use of the said Orphanage AND I DIRECT that the receipt of the said Mother Superior shall be a sufficient discharge to my Trustee AND I APPOINT my sister MARY MARGARET BARR Executrix and Trustee of this my said Will."

The husband of the testatrix predeceased her on 9 March 1986. They had no children. Her next of kin are two sisters, a brother and two children of a deceased brother.

In 1960 there was no institution called "the Girls' Orphanage Goulburn". However, in the period 1960 to 1975 there existed an institution known as the St Joseph's Girls' Home ("the Girls' Home"). At the trial, it was not contested that the testatrix was referring to this institution in her will. The Girls' Home was located in Kenmore, a suburb of Goulburn. It was run by the Sisters of Mercy, Goulburn and Amalgamated Houses ("the Sisters of Mercy") which was a body corporate constituted under the Roman Catholic Church Communities Lands Act, 1942. The Sisters of Mercy in turn ran the institution on behalf of another body corporate, the Trustees of the Roman Catholic Church of the Archdiocese of Canberra and Goulburn ("the Church Trustees"), constituted under the Roman Catholic Church Trust Property Act 1936.

The person in charge of the Girls' Home was called the Mother Superior until 1970, at which time her title was changed to Sister Superior. The Girls' Home did look after orphaned girls when the will was made. But it did more than that. It also provided shelter, education and care for underprivileged girls from broken homes, from families which had deserted them, and from families too poor to care for them. Indeed, at the date of the will, there was only one girl who could be described as an orphan.

At the time the will was made, there was also in existence the St John's Boys' Home, Goulburn ("the Boys' Home"). It too was run by the Sisters of Mercy. The evidence at the trial indicates that the testatrix was aware of the existence of both the Boys' Home and the Girls' Home when she made her will. On 1 January 1975 the Boys' Home and the Girls' Home were amalgamated to form St John's Children's Home ("the Children's Home"). The new institution provided separate accommodation for both sexes in two cottages. The objectives of the amalgamation were to centralise the resources of the two institutions, provide a more homely atmosphere for the children, and to keep together children from the one family. When the testatrix died, the Children's home cared for six children, including two orphan girls and an orphan boy.

On 31 December 1987, following the death of the testatrix, the Children's Home was taken over by the Mary Mead Children's Centre. The Centre is controlled by trustees and a board of directors appointed by the Church Trustees. It cares for girls aged between 1 to 17 years and boys aged | to 11 years whose families reside in the Australian Capital Territory and in the surrounding districts of New South Wales. It provides a wider range of services than the previous homes including family support and advisory services.

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In 1988 the first respondent, Mary Margaret Barr, the executrix under the will of her sister, commenced proceedings in the Equity Division seeking the determination of certain questions about the construction of the will. Hodgson J found that the institution referred to in the will was intended by the testatrix to be the St Joseph's Girls Home. This, as I have indicated, was not in contest. His Honour found, however, that the gift had lapsed. In doing so, he rejected the two alternative bases upon which it was contended that the gift might stand. First, he rejected the submission that the Children's Home was the successor to the Girls' Home for the purposes of the law of charities. Secondly, he found that the will disclosed no general charitable intention. Accordingly, he refused to make an order that the gift be administered cy-pres.

This appeal is brought by the Attorney General in his capacity as parens patriae. Initially, the appeal proceeded on the basis that his Honour was correct to hold that the Children's Home was not a successor institution to the Girls' Home. Rather, it was contended that the gift should be administered cy-pres because the will disclosed a general charitable intention on the part of the testatrix. However, during the course of argument, counsel for the Attorney General sought leave to amend the notice of appeal to raise the issue whether Hodgson J was correct to hold that the Children's Home was not a successor institution. The Court granted leave to amend on the basis that the respondents would be protected as to costs.

Since the named institution (which must be taken to have been the Girls' Home), although in existence at the date of the will, had ceased to exist during the lifetime of the testatrix, the gift will ordinarily be taken to have lapsed: see Re Tyrie Deceased (No 1) (1972) VR 168 at 177, and Tudor on Charities 6th Ed. (1967) at 259-60. There appears to be no question about the correctness of this principle and I need not therefore cite the many cases advanced in support of it by Newton J in Re Tyrie and by the learned editors of Tudor.

There is, however, a number of exceptions to the general rule; Newton J examined them in Tyrie and, in the present case, reliance is placed upon one of them by counsel for the Sisters of Mercy and the trustees, and by counsel for the Attorney General.

The argument, which the learned judge, of course, rejected, was that at the date of the testatrix's death there was in existence the Children's Home formed by an amalgamation of the Girls' Home and the Boys' Home which could properly be regarded as the successor of the Girls Home and as carrying on the work which the Girls' Home had previously undertaken. Since the dominant charitable intention of the testatrix was wide enough to allow the gift to take effect in favour of that successor institution, it should be applied cy-pres since, of course, the successor institution itself had ceased to exist. This submission is based upon the first of the three exceptions formulated by Newton J in Tyrie, and appears to have been accepted before Hodgson J as a correct statement of principle. I need not, therefore, consider the cases such as In Re Slevin (1891) 2 Ch 236, or Williams and Anor v Attorney General and Anor (1948) 48 SR 505.

The two questions then to be considered are first, whether the Children's Home can be regarded as a successor institution to the Girls' Home and, secondly, if yes, whether the will reveals a dominant general charitable intention which will allow the gift to take effect in favour of the Children's Home and thus, in the events which have happened, to be applied cy-pres. Although I have divided these two requirements, it seems to me that the solution really depends upon whether or not the will reveals an overriding or dominant general charitable intention. If it does

not, then the gift will lapse even though it can be said that the surviving institution is carrying on the work of the original donee of the gift.

Largely for the reasons given by Hodgson J, I find it impossible to perceive the necessary charitable intention in the will. As his Honour said, there is no reference to the purposes of the orphanage (or, I suppose, to those of the Girls' Home to which the testatrix was referring), while there is a direction that the gift shall be "for the use of the said orphanage." It is true that, as counsel for the Attorney General contended, the testatrix did not go to the trouble of establishing the correct name of the institution that she intended to benefit, and that this omission, it has been said, may point to general purposes rather than to the institution itself as the object of the gift: see Attorney General of New South Wales v Public Trustee and Anor (1987) 8 NSWLR 550 at 555 per Hope JA (with whom Kirby P and I agreed). In this case, however, the answer is that if there was a purpose in the testatrix's mind, it was to aid orphans; and, of course, none of the institutions here in question fulfilled that role. Upon the proper interpretation of the will, and bearing in mind what was said in Attorney General for New South Wales v Public Trustee and Anor, and so confining myself to the terms of this will in the circumstances of this case without being beguiled by the incidents of other decisions, I conclude that this was a gift to the Girls' Home to assist that institution in the charitable work which it was carrying out. The Girls' Home was not the channel for carrying out a charitable intention; its own work was the object of the gift: see 4 Halsbury, 3rd Ed, p 280 and cf 5 Halsbury, 4th Ed, para 637. I do not consider that the will yields any wider or more general charitable intention than this.

I therefore agree with Hodgson J and propose that the appeal be dismissed. We should hear counsel on the question of costs.

Handley JA In this matter I have had the benefit of reading in draft form the reasons for judgment of Samuels JA and I gratefully adopt his statement of the facts and the history of these proceedings. The first question which arises in this appeal is whether the gift to the Mother Superior of the Girls' Orphanage Goulburn for the use of the orphanage lapsed. There can be no doubt that the St Joseph's Girls Home at Kenmore, Goulburn is the institution described in the will as "the Girls' Orphanage Goulburn" and that it remained in existence at least until its informal amalgamation with St John's Boys' Home Goulburn on | January 1975. As at 31 December 1974 there were thirty girls in residence at St Joseph's.

The evidence indicates that the purpose of the amalgamation was "to centralise resources", keep children from the one family together and provide a more homely environment. As far as possible siblings were housed together in group home accommodation. The amalgamated institution known as St John's Children's Home Goulburn was located in two cottages at No 8 and No 12 Auburn Street, situated next to, and presumably on either side of, the premises formerly known as St John's Boys' Home.

Prior to the amalgamation both institutions had been managed by the Sisters of Mercy on behalf of the Corporate Trustees of the Roman Catholic Archdiocese of Canberra and Goulburn. The amalgamation was an informal one, being effected without a court order or variation of trust. The properties occupied by the former institutions were vested in the Corporate Trustee and merely managed by the Sisters of Mercy. It appears therefore that those properties were held on trust for the general purposes of the Church in the Diocese and that no variation of trust was necessary in order to effect the amalgamation.

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A preliminary question of construction arises as to whether this was a gift to a particular person or association for charitable purposes, was a gift for the purpose of carrying on particular charitable work or was a gift to or for the benefit of a particular institution at a particular place. See Re Watt (1932) 2 Ch 243 at 245, 246 and Re Lucas (1948) Ch 424 at 427. In my view this was a gift to a person, namely the Mother Superior of the Girls' Orphanage, for the use, that is for the purposes of that orphanage as an institution and not just for the upkeep of the premises as an orphanage.

The first question then is whether the St Joseph's Girls' Home Goulburn ceased to exist on 1 January 1975 or whether for legal purposes it remained in existence as part of the new institution formed by the amalgamation. This question may be postponed to permit consideration of the second question which is whether the amalgamated institution itself was in existence on 19 October 1987 when the testatrix died.

At that date six children were still being cared for in St John's Children's Home, including two orphan girls and one orphan boy. It does not appear whether the home was still being carried on at both No 8 and No 12 Auburn Street but nothing turns on this.

It is clear that the activities of the Children's Home had been greatly reduced in scale but it is also clear that it was still in existence. A gift to a particular charity does not lapse if at the date of death it is merely moribund, but not yet dead. See Re Buck (1896) 2 Ch 727 at 735. It does not matter if the charlty "has to a great extent failed" provided it has "not wholly ceased to exist" although it may be "in a poor way". See Re Waring (1907) 1 Ch 166 at 170-171. See also Re Roberts (1963) 1 WLR 406 at 415-416 and Re Tyrie (1972) VR 168 at 177. Compare Re Withall (1932) 2 Ch 236 at 241.

If the gift had been in favour of the St John's Children's Home Goulburn it would not have lapsed and the residuary estate would be held on a valid charitable trust.

I return therefore to the first question to determine whether the St Joseph's Girls' Home ceased to exist when it was amalgamated with St John's Boys' Home on | January 1975.

The amalgamation was an informal one, nothing more being required. In some circumstances an informal amalgamation of charitable societies or institutions will not destroy the amalgamated charities which are treated as continuing to exist within and as part of the new society or institution. In Re Tyrie (above) Newton J reviewed most of the cases dealing with the lapse of gifts to particular charitable institutions and the application of such gifts cy-pres if such institutions ceased to exist in the lifetime of the testator. However in my opinion, and with respect, his Honour's analysis at pp 177-179 was not intended to be fully comprehensive and in any event it does not cover the present situation. I note in particular that at 177 his Honour said that:

"Tt is first necessary for me to decide what are the relevant principles to be applied. It appears to me that for present purposes these principles may be stated as follows..."

In particular it seems to me that his Honour's analysis does not, in terms, deal with the effect of an informal amalgamation of institutions during the lifetime of a testator. This problem has been considered in a number of cases which are not referred to in his Honour's reasons for judgment although they are cited in Tudor on Charities and in Halsbury's 3rd Edition vol 4 at the pages referred to by his Honour at 178.

In Re Joy (1888) 60 LT (NS) 175 the testatrix gave legacies to two anti-vivisection societies which lawfully amalgamated during her lifetime. At 176 Chitty J said:

"Substantially however... so far as the legacies are concerned, the two societies continue to exist, although they now bear the name of one, and one only.... in cases of this kind, some slight alterations made in the constitution of the society as it existed at the date of the will do not avoid the legacy, and have not the effect of justifying the Court in saying that because there has been some alteration the identity is lost.... I think... these two societies do continue for the purpose of this will to exist, although they have combined and now exist under one name."

This decision was followed in Re Pritt (1916) 85 LJ (Ch) 166 and approved by Lord Hanworth MR in Re Withall (1932) 2 Ch 243 at 245. See also Re Dawson (1957) 1 WLR 391 at 396.

These cases are not directly in point because here there was no amalgamation of charitable societies and no amalgamation of charitable funds. There is no evidence that the St Joseph's Home for Girls or the St John's Home for Boys possessed any charitable endowments when they were amalgamated. It was an amalgamation only in the sense that activities carried on for charitable purposes at separate locations were combined at a single location. After the amalgamation the same religious order operated the amalgamated home but in different bricks and mortar owned by the same Corporate Trustee. While it remained in existence the amalgamated home fulfilled the same functions for orphan and other girls in Goulburn as had previously been fulfilled by the St Joseph's Girls' Home.

The change of name and change of locality within Goulburn in the lifetime of the testatrix clearly do not matter. See Re Wedgwood (1914) 2 Ch 245, Re Withall (1932) 2 Ch at 240-242 and compare Re Lucas (1948) Ch 424 at 427.

I see no reason why the principles established in the cases dealing with the informal amalgamation of charitable societies should not apply to other informal amalgamations such as that which occurred in this case. This conclusion is supported by the decision in Re Hutchinson (1953) Ch 387. In that case the testator had made gifts of his residuary estate in equal shares for five hospitals in Nottingham including "The Nottingham and Nottinghamshire Hospital for Diseases of the Throat, Ear and Nose, 63 Goldsmith Street, Nottingham". After the date of his will the governing body of the Throat Hospital resolved to close that hospital and passed a resolution "that the hospital, its properties and funds be amalgamated and the patients' waiting list be transferred to the Ear, Nose and Throat wing of the Nottingham General Hospital". Upjohn J said at 393:

"What was the intention of the testator in making these gifts and disposing of the whole of his residue between the five hospitals in Nottingham... In my judgment he was intending to benefit not merely these particular institutions carried on at the places where they were respectively being carried on at the time he made his will, but he was intending to benefit the work of each charity as such. I cannot think had one of them amalgamated in the true sense with another that the testator would have thought for one moment that his gift would have failed. In my judgment he was intending to benefit the charitable work of each of these charities... and not the particular institution carried on in certain particular premises in each case."

Further support for this conclusion is to be found in that part of the decision in Re Tyrie (above) which upheld the gift of a share of residue to "the Salvation Army Toddlers' Home" with a direction that the receipt of the treasurer, secretary or manager for the time being of the institution should be a sufficient discharge

URJ ATTORNEY GENERAL FOR NEW SOUTH WALES v BARR (Handley JA) 11

for the legacy. The testatrix had made her will in 1965 and died in 1967. Between 1914 and 1947 the Salvation Army conducted a home known at the Toddlers' Home at an address in North Carlton which accommodated children up to the age of five. However in 1947 the Army opened Kardinia Children's Home at Geelong, closed the Toddlers' Home and transferred all the children to the Geelong home. Until 1958 the Geelong home accommodated children only up to the age of five. In that year a cottage system commenced in accordance with modern conceptions of child welfare work and children up to the age of fourteen lived in cottages under the care of cottage parents. In that case of course the relevant changes had occurred prior to the date of the will. Newton J said at 186-187:

"In my opinion the testatrix by the description in CL10 of her will... must be taken to have referred to the... Kardinia Children's Home. Between 1947 and 1957 it had been... the only "Toddlers' Home' conducted by the Salvation Army in Victoria. At the date of the will... it was still in existence, albeit since 1958 it had accommodated older children as well as 'toddlers'. It was still inter alia a 'toddlers' home' and was still the only home for 'toddlers' conducted by the Salvation Army in Victoria. CL10 of the will refers to the Salvation Army Toddlers' Home simpliciter, and makes no reference to Canning Street.... I should add that if I had decided that by the expression 'the Salvation Army Toddlers' Home' the testatrix had intended to refer to the Canning Street home, I should nevertheless have held that the gift did not lapse... that Kardinia Children's Home was the successor institution (in the sense of establishment or activity) to the Canning Street home and that the dominant intention of the testatrix was wide enough to allow the gift to take effect in favour of Kardinia Children's Home."

The decision in Re Tyrie holding that the gift in favour of "The Salvation Army Toddlers' Home" took effect in favour of Kardinia Children's Home Geelong was followed in Re Flynn (197S) VR 633. So far as relevant the gift in that case was of a share of residue for "St Vincent De Paul's Girls' Orphanage, Napier Street, South Melbourne". The testatrix made her will in 1956 and confirmed it by a codicil in 1960. She died in 1972. The first question in the originating summons was whether the Sisters of Mercy who conducted the St Vincent De Paul Children's Home, Balcombe Road, Black Rock were entitled to take the gift in the will to St Vincent De Paul's Girls' Orphanage, Cecil Street (sic), South Melbourne. The facts were that the Sisters of Mercy had conducted a girls' orphanage at the address named in the will between 1874 and 1960. In 1960 so that families could be kept together the Sisters began to care for small boys as well as girls, but only where the boy's sister was already in the home. At the same time it was recognised that few orphans came under the care of the Sisters and the name was changed from St Vincent De Paul's Girls' Orphanage to St Vincent De Paul Children's Home. About the same time the Sisters first experimented with family group homes and ultimately twelve of these were established in the suburbs of Melbourne. In 1966 the Sisters transferred their headquarters from Napier Street, South Melbourne, to Balcombe Road, Black Rock.

Starke J rejected a submission by counsel for the next of kin that the gift was to a particular institution at a particular place which no longer existed and a further submission that the institution being carried on at the date of death was a different institution and not entitled under the gift. The judge said:

".. the dominant intention of the testatrix was that the gift should be applied for the benefit of girls who were cared for at the institution conducted by the Sisters of Mercy,... at St Vincent De Paul's Girls' Orphanage. The address given

in the will,... was... plainly intended for the identification of the institution and has no other significance... I do not think that the mere admission of boys as well as girls could operate to cause the gift to lapse.... Finally (counsel) contended that the whole nature and character of the institution... had changed... at the date of... the will the children were accommodated in dormitories and at the date of her death they were accommodated in family group homes... It would... be unthinkable that the gift should fail because changes of this nature took place. In all institutions changes are made from time to time in accordance with modern methods.... The essential and indispensable intention of the testatrix was that her charitable purpose should be carried out through the instrumentality of the home conducted by the Sisters of Mercy.... I am of opinion... that the institution has never ceased to exist... and... the question of lapse does not arise."

Unfortunately our attention was not directed by counsel either to the reasons of Newton J in Re Tyrie for upholding the gift to the Salvation Army Toddlers' Home or to the decision in Re Flynn both of which are directly in point on the question of lapse.

For these reasons in my opinion the appeal should be allowed. A declaration should be made that on the true construction of the will of the deceased and in the events that happened the residuary estate of the testatrix was held at the date of her death In trust to pay or transfer the same to the Sister Superior of the St John's Children's Home, Auburn Street, Goulburn to be applied for such of the purposes of that home as were identical with the purposes of the St Joseph's Girls' Home at the time of its amalgamation with the St John's Boys' Home on 1 January 1975. See Re Dawson (1957) 1 WLR 391 at 397.

The St John's Children's Home was closed on 31 December 1987, a few weeks after the death of the testatrix, and the remaining children transferred to the Marymead Children's Centre, Goyder Street, Narrabundah ACT. The institution in Goulburn selected by the testatrix then ceased to exist, even within an amalgamation. There is no longer a Sister Superior able to give a good receipt for the gift and act as trustee. Strictly therefore a scheme should be directed to appoint a new trustee and provide for the application of the charitable funds. There must be an order for such a scheme to be settled.

Set aside the orders of Hodgson J except as to costs.

Declare that on the true construction of the will of the late Alice Patricia Cassells and in the events that have happened the residuary estate of the testatrix was held in trust at the date of her death to pay the same to the Sister Superior for the time being of St John's Children's Home Goulburn to be applied for such of its purposes as were identical with the purposes of St Joseph's Girls' Home at the time of its amalgamation with St John's Boys' Home on | January 1975.

Order that the proceedings be remitted to the Equity Division for the settlement of a scheme for the application and administration of such funds.

Order that the costs of all parties of this appeal, the costs of the first respondent on a trustee basis and the costs of the appellant and all other respondents on a common fund basis be paid or retained out of the estate of Alice Patricia Cassells.

Appeal allowed;
Set aside the orders of Hodgson J except as to costs;

JOBNAME: No Job Name PAGE: 13 SESS: 1 OUTPUT: Fri Oct 19 12:11:34 2007

ATTORNEY GENERAL FOR NEW SOUTH WALES v BARR (Handley JA) 13

. Declare that on the true construction of the will of the late Alice Patricia

Cassells and in the events that have happened the residuary estate of the testatrix was held in trust at the date of her death to pay the same to the Sister Superior for the time being of St John's Children's Home Goulburn to be applied for such of its purposes as were identical with the purposes of St Joseph's Girls' Home at the time of its amalgamation with St John's Boys' Home on | January 1975;

. Order that the proceedings be remitted to the Equity Division for the

settlement of a scheme for the application and administration of such funds;

. Order that the costs of all parties of this appeal, the costs of the first

respondent on a trustee basis and the costs of the appellant and all other respondents on a common fund basis be paid or retained out of the estate of Alice Patricia Cassells; and

Solicitors for Appellant: H K Roberts, Crown Sollcitor

25 Solicitors for 2nd-4th Respondents: J C Warsh and Sons

Counsel for 5th Respondent: B J Tamberlin QC with R J Darke

Solicitors for 5th Respondent: Connery and Partners

At a glance

Court

Decision date

Before

Source

Judgment (111 paragraphs)

Parties

Cases Cited (4)

Cited By (1)