Key Facts
- •In 1927, Mr. Gaspard Farrer anonymously donated £500,000 to establish a fund to eventually discharge the National Debt.
- •The fund's growth was intended to inspire further contributions.
- •Subsequent contributions were made, but the fund's size remained minuscule compared to the National Debt.
- •The court determined the original charitable purpose was unattainable due to the fund's size and changed government policy.
- •Two cy-près schemes were proposed: one by the Attorney General (applying the fund to reduce the National Debt) and one by the trustee (applying the fund to general charitable purposes).
Legal Principles
Cy-près scheme application under section 67 of the Charities Act 2011.
Charities Act 2011, section 67
Court's jurisdiction to alter original charitable purposes under section 62 of the Charities Act 2011.
Charities Act 2011, section 62
The 'spirit of the gift' requires considering the donor's basic intention, not just the literal wording of the trust deed.
Varsani v Jesani [1999] Ch 219; White v Williams [2010] EWHC 940 (Ch)
In cy-près schemes, the court considers the spirit of the gift, closeness to original purposes, and the need for suitable and effective modern application.
Charities Act 2011, section 67(3)
Appeal courts review evaluative decisions for identifiable flaws, not substituting their own judgment.
Re Sprintroom Ltd [2019] EWCA Civ 932
Outcomes
The appeal was dismissed.
The court found the Attorney General's scheme, applying the fund to reduce the National Debt, was the most appropriate, aligning with the spirit of the gift and the secondary purpose of the original trust.