Court Determines Ownership and Trusteeship in Charity Dispute Over Abbey Mills Site

Citation: [2023] EWHC 2761 (Ch)
Judgment on

Introduction

In the High Court case of Solad Sakandar Mohammed & Ors v Sabir Ahmed Ebrahim Daji & Ors, the court was presented with a dispute concerning the ownership and trusteeship of a substantial freehold site at Abbey Mills, Canning Town, London, intended for religious and charitable use as a mosque for the Tablighi Jamaat community. This case brings into focus several key principles of trust and charity law, including donor intentions, the establishment and execution of charitable trusts, and the principles governing the replacement and removal of trustees.

Key Facts

The site in question was purchased by three trustees for £1.4m in the 1990s. The core dispute revolved around whether the purchase monies and subsequent ownership of the Land were intended for a London-based trust focused on serving the Tablighi Jamaat community in the region or for a trust based in Dewsbury with broader charitable purposes. Further, the removal of one trustee and the appointment of another were contended, with the subsequent rectification of the trustee register being sought.

The judgment elucidated on several legal principles applied in determining the rightful trusteeship and purpose of the Land’s use:

  1. Donor Intention and Charitable Trusts: The court highlighted that a donation to a charity is held for the purposes specified by the donor, ascertained objectively from the donor’s perspective, aligning with the principles in Tudor on Charities and leading cases like Re Church Army.

  2. Executory vs. Executed Trusts: The case differentiated between executory and executed trusts. An executory trust, as stated in Lewin on Trusts, contemplates the execution of an additional instrument to perfect the trust, whereas an executed trust has defined equitable interests. The court dealt with the appropriate inference from a home-made ‘96 Trust Deed’ initially lacking clarity on its execution date.

  3. Declarations of Trust: It was determined that declarations of trust could be executed by trustees on behalf of the donor, provided they did not conflict with the initial appeal’s terms (Attorney General v Mathieson).

  4. Replacement and Removal of Trustees: Under s.36(1) and s.40 of the Trustee Act 1925, the court examined the legitimacy of replacing a trustee who effectively refuses to act. The decision emphasized the need for existing trustees’ resolutions at properly convened meetings, per the trust deed’s guidelines or statutory provisions if applicable.

  5. Cy-Près Doctrine: The Cy-près doctrine, although not determined in this case due to the claimants’ success on other grounds, was mentioned in the context of a charity potentially not being able to fulfill its original purposes (s.62 Charities Act 2011).

Outcomes

The Court decisively found that:

  1. Ownership: The Land was to be held on the terms of a London trust, rather than the Dewsbury Trust, based on the objective intention of the donors and the trustees’ conduct.

  2. 1996 Declaration of Trust: The document was ultimately considered valid and reflective of the donors’ intentions.

  3. Trustee Removal: D14 was justifiably removed as a trustee of the London Trust due to refusal to act, and C3’s appointment as a new trustee was validated.

  4. Cy-près Claim: The claim was deemed unnecessary to determine following the resolution of the primary issues.

Conclusion

The case of Solad Sakandar Mohammed & Ors v Sabir Ahmed Ebrahim Daji & Ors serves as an instructive example of the application of charity law principles, particularly concerning donor intentions and the execution of charitable trusts. It reaffirms the importance of the trustees’ fiduciary duties and adherence to the explicit terms set out by charitable trust donors. The court’s systematic approach in unwinding the case’s intricacies offers a clear precedent for handling similar disputes, emphasizing the paramountcy of donors’ intentions and proper trustee administration in trust and charity law.

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