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Charity Tribunal has no power to reverse sale of charitable land

19 August 2009

The Charity Tribunal has no powers to set aside the sale of charitable land to a private developer by a local authority acting as sole trustee.

The tribunal was ruling in a case started by two Dartford residents, Derek Maidment and Lennox Patrick Ryan, who objected to the council selling the land to developer St James Investment. The proposed redevelopment plan would include a Tesco supermarket.

The land, which is part of Dartford's Central Park, was left by Charles Newman Kidd to the council in 1903 for use "in perpetuity as a public recreation ground and for no other purpose whatsoever".

The two men asked the tribunal to set aside the Charity Commission decision in March which upheld a scheme, sealed in October 2008, allowing the charity to divest some of the land to fund maintenance of the rest of the parcel.

But in a preliminary ruling the Charity Tribunal held in Maidment and Ryan v Charity Commission (13 August 2009, unreported) that it could only act within the statutory powers vested by the Charities Act, and that “these do not include the power to set aside a land transaction”.

The tribunal nevertheless said it could quash the scheme if it found that Dartford Borough Council had acted in bad faith.

It said it wanted to consider evidence about whether the council acted reasonably when it decided to sell the land “or whether the issue should have been further investigated by the respondent so that the scheme should now be quashed and the matter remitted by the tribunal to the respondent for further consideration”.

The point is to be argued in a four-day hearing at the end of October, together with other issues including whether Dartford had correctly interpreted its duty to maintain the land and whether planned future use of the land under the scheme is permitted by the Deed of Gift.

However, the tribunal also believed that Dartford, as trustee, did not have the powers available to it as a local authority to order a compulsory re-purchase of the land.

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Charities Wills, Trusts & Probate Local government