The form of Schedule 2 at the time of incorporation
155Hamilton J's conclusion was, in short, that all that the 1984 Act vested in the incorporated Association was the limited interest of the unincorporated Association in the trust property and that therefore this did not include any equitable estate or interest in the property. At most, so his Honour held, the unincorporated Association had a right (which might or might not have been a right of property) to use the property for the charitable purpose (see [77] and [119] above).
156The basis upon which the appellants challenge these conclusions in the event that Hamilton J's description of the trust is upheld is encapsulated in the following submissions:
"The Trustees held the legal estate in the Schedule A property or part thereof in trust for or on behalf of the Unincorporated Association within para (b) of cl 2(1). The words 'for or on behalf of a former Association' in para (b) of cl 2(1) encompassed the trust created by cl 1 of the Trust Deed. As the Unincorporated Association had the right to use the first property, the trust was 'for or on behalf of' the Unincorporated Association. The words 'for its purposes' in para (b) of cl 2(1) also encompassed this trust. As the trust purpose is substantially similar to the objects in paragraph A in cl 3 of the Unincorporated Association Constitution, the Trust being for the main charitable object of the Unincorporated Association ... was 'for its objects'. As the extent of the Schedule A property that was so held by the Trustees was the legal estate, it was that legal estate that vested in the Association pursuant to cl 2(1). The words 'to the extent that the property was so ... held' in the latter part of cl 2(1) are not ambiguous as they refer to the property within the description in para (b): in other words, they refer to property held in trust or otherwise for the former association or on behalf of the former association or for the objects of the former association" (Submissions dated 20 July 2007, [97]).
157I reject these submissions for the following reasons.
158First, contrary to the appellants' assertion, the trustees did not hold the legal estate to any of the property on trust "for or on behalf of the unincorporated Association" (see clause 2(1) of Schedule 2). The trust applicable to both the Schedule A and non-Schedule A property was a trust for a charitable purpose, not a trust for a person or entity. The property, whether held by the 10 trustees or otherwise, was not therefore held "for or on behalf of" the unincorporated Association. As Hamilton J pointed out, the reference in the Deed of 8 March 1977 to the unincorporated Association as "the proposed beneficiary" did not, on the Deed's proper construction, indicate otherwise. This was not, as in Bacon v Pianta [1966] HCA 44; 114 CLR 634, a gift to (or trust for) an unincorporated association. As a result the different possibilities referred to in that case as to how such a gift (or trust) may operate do not arise for consideration in the present case.
159Secondly, the trust here was not one "for or on behalf of" the unincorporated Association "for its objects" (see clause 2(1) of Schedule 2). The fact that there was substantial coincidence between the purpose of the trust and the objects of the unincorporated Association does not mandate a different conclusion. The trust purpose was immutable except as a result of the Court settling a scheme, whereas the unincorporated Association's objects were able to be changed by resolution of its members. Even if the objects of the Association had been identical and immutable, the fact would remain that the trust here was found to be for an identified purpose and not one for the objects of the Association, or any other entity.
160Thirdly, the unincorporated Association's right to use the trust property for the charitable purpose did not, as the appellants submit, render the trust one "for or on behalf of" the unincorporated Association. As Hamilton J observed, it is not by any means clear that the reference in the description of the trust to the trust property being used by the unincorporated Association for the charitable purpose conferred any right of property on the Association. Certainly, the right of user does not confer on the Association any beneficial interest in the property as it is not entitled to use the property other than for the charitable purpose. The right is similar to the right (and duty) of a trustee of a charitable trust to use the trust property for the charitable purpose but does not necessarily involve the Association holding any property. The description of the right in the Deed of 8 March 1977 was consistent with the trust property being held by an entirely separate trustee. Moreover, as pointed out earlier (see [129] above), in the description of the trust the Association was simply identified as a vehicle for the achievement of the trust purpose. Inability or unwillingness on its part to perform that role would thus likely see its replacement as a result of the settlement by the Court of a cy-près scheme.
161Fourthly, the appellants' assumption that the 1984 Act vested in the incorporated Association the legal estate in the trust property held by the trustees is erroneous. None of the elements of clause 2(1) of Schedule 2 was satisfied. That legal estate was not vested in the unincorporated Association but was vested in the trustees (see clause 2(1)(a)) and was not held by them in trust or otherwise "for or on behalf of" the unincorporated Association or "for its objects". They held the property, not for the unincorporated Association or its objects, but for the identified charitable purpose.
162The incorporated Association now holds the trust property. To the extent that that property was previously held by the 10 trustees appointed by the unincorporated Association (as most of the Schedule A property was) the transfer to the incorporated Association was not, for the reasons given above, effected by the 1984 Act. Schedule 2 of the 1984 Act did not operate in respect of that property because it was not property as described in clause 2(1) of Schedule 2. Nevertheless, the transfer has occurred and the incorporated Association holds the property as trustee subject to the same charitable trust as that upon which the previous trustees held it.
163Trust property other than that held by the 10 trustees, for example the non-Schedule A property such as the Holy Objects, appears, as a matter of legal analysis, to have been held by the members of the unincorporated Association (as the Association was not then a legal entity), or by the Committee on behalf of the members. As I have concluded (see [143] above), that property was part of the trust property. As a result, those who held the property had no beneficial interest in it. Upon incorporation, Schedule 2 vested the legal interests in this property in the incorporated Association. The reference in clause 2(1)(a) of Schedule 2 to property vested in the unincorporated Association, must, in light of the Association's lack of legal personality, be taken as a reference to property vested in the members of the Association for its purposes. As Hamilton J held, the vesting in the incorporated Association was, according to the terms of clause 2(1) of Schedule 2, only "to the extent that the property was ... vested or held" by the unincorporated Association. The unincorporated Association held (through its members) only the bare legal interests. No more than that was therefore vested in the incorporated Association by the 1984 Act.
164I add that this analysis applies also to the unincorporated Association's "right", if it can be regarded as that, to use the trust property for the identified charitable purpose. The right did not carry with it any beneficial interest in the property. However, the Association arguably had standing to enforce its right and thus had a chose in action interest that vested in the incorporated Association in accordance with Schedule 2 of the 1984 Act. In any event, upon incorporation the Association became the entity falling within the description in the trust of the permitted user and enforcement of the trust would involve allowing the Association to use the trust property for the specified charitable purpose.
165The appellants placed considerable reliance on clause 2(2)(b) of Schedule 2, submitting that it demonstrated a legislative intent to extinguish any trust previously binding property which the 1984 Act vested in an incorporated association. I do not accept this submission.
166The position can be tested by asking what would have been the effect of incorporation on a private trust of which the unincorporated Association was trustee. It would seem to follow from the appellants' submission that the legislative intent was to extinguish the rights of the individual who was the beneficiary under the trust and, on incorporation, vest the whole of the legal and equitable interests in the property in the incorporated Association. There is nothing in the Act that would support that radical result. Why then, it needs to be asked, should a similarly radical result be concluded to follow in relation to a trust for a purpose rather than for a person?
167In my view clause 2(2)(b) of Schedule 2, far from operating to extinguish charitable trusts, is designed to preserve them by ensuring that the incorporated Association remains bound by them. No doubt clearer language, such as used in some interstate statutes to which the appellants referred, could have been used but the meaning of the words in fact used is in my view tolerably clear. The operative words of the paragraph prohibit the relevant property being dealt with contrary to an applicable trust. A trust is an applicable trust if, first, it is one which affected the property immediately before incorporation of the Association and, secondly, its provisions relate to the purposes for which the property is required to be applied. Both of these conditions were satisfied in the present case, with the result that the incorporated Association became bound by the trust.
168In my view it is not of significance, at least in the present case, that the paragraph refers to "the provisions" of any trust rather than simply to the trust itself. There are no provisions of the present charitable trust other than those relating to the purposes for which the property is to be applied.
169In support of their approach to the construction of Schedule 2, the appellants submitted:
"That the object of the 1984 Act was to enable an association carried on for charitable purposes to be incorporated (see s 7(1)(2)(a)) and to carry on its activities subject to the terms of its constitution without the imposition of trust obligations (see s 18(1))" (ibid [99(f)]).
170The submission is not supported by the sections of the Act to which it refers. Section 7 renders associations carried on "for the object of trading or securing pecuniary gain for its members" ineligible for incorporation under the Act and s 18(1), in effect, confines an incorporated association's activities to those authorised by its constitution. The sections say nothing about the freedom of an incorporated association from trust obligations.