Freddie Freed & Anor v Saffron Management Limited & Ors
[2023] EWHC 1919 (Ch)
Enus Ali & Anor v Muhammad Modu Miah & Anor
5 June 2024
[2024] EWHC 1818 (Ch)
High Court
A fight over who runs a mosque led to a court case. One trustee removed two others, saying they were unfit because they lied about knowing about the court case. The higher court agreed the trustee acted correctly, as the lies could have harmed the mosque's case.
Key Facts
- •Dispute over ownership of a mosque between The East Ham Bangladeshi Islamic Community Trust and Mr. Bari.
- •Preliminary questions arose regarding the Trust's trustees and their consent to County Court proceedings.
- •HHJ Richard Roberts determined the trustees as Mr. Miah, Mr. Ali, and Mr. Wahid.
- •Mr. Miah subsequently sought to remove Mr. Ali and Mr. Wahid as trustees under s36 of the Trustee Act 1925, replacing them with Mr. Rahman and Mr. Hussain.
- •The Judge concluded Mr. Miah's substitution was valid, deeming Mr. Ali and Mr. Wahid unfit to act.
- •Mr. Ali and Mr. Wahid appealed, arguing the trust instrument ousted s36's power and that the Judge erred in finding them unfit.
Legal Principles
Section 36 of the Trustee Act 1925 allows for the appointment of new trustees when a trustee is unfit, among other reasons.
Trustee Act 1925, s36
Section 69(2) of the Trustee Act 1925 allows a trust instrument to oust the powers conferred by the Act, unless otherwise stated.
Trustee Act 1925, s69(2)
To oust the powers of s36, the trust instrument must express a contrary intention inconsistent with its purport (IRC v Bernstein [1961] Ch 399 (CA)).
IRC v Bernstein [1961] Ch 399 (CA)
The court's power to replace trustees under s41 of the Trustee Act provides guidance on what constitutes 'unfitness' under s36, encompassing misconduct.
Trustee Act 1925, s41; Tudor on Charities, paragraph 19-039, 19-049
Outcomes
Appeal dismissed.
The court found that the trust instrument did not express a contrary intention to oust the power under s36 of the Trustee Act. The Judge's finding of unfitness was also upheld, as the Appellants' false testimony regarding their knowledge of the County Court proceedings was deemed to be against the Trust's interests.
Ground 1 (s36 power ousted by trust instrument) failed.
The trust deed's provisions for trustee appointment and removal did not demonstrate a contrary intention to exclude the additional powers in s36 of the Trustee Act. The court found that s36 could operate alongside the trust deed's provisions.
Ground 2 (Judge erred in finding unfitness) failed.
The Judge's conclusion that Mr. Ali and Mr. Wahid were unfit was an evaluative judgment supported by their false testimony concerning the County Court proceedings, which was detrimental to the Trust's interests. The court determined the Judge was entitled to reach this conclusion.
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