Oppenheim v. Tobacco Securities Trust Co Ltd and Others
[1951] 1 All ER 31(Decision by: Lord Morton of Henryton)
Between: Oppenheim
And: Tobacco Securities Trust Co Ltd and Others
Judges:
Lord Simonds
Lord Normand
Lord Oaksey
Lord Morton of HenrytonLord MacDermott
Subject References:
Charity
Education
Public character
Public nature of bond between beneficiaries
Gift for the education of the children of past and present members of limited company
Case References:
Re Compton - [1945] 1 All ER 198; [1945] Ch 123; 114 LJCh 99; 172 LT 158; 2nd Digest Supp
Re Hobourn Aero Components Ltd's Air Raid Distress Fund - [1946] 1 All ER 501; [1946] Ch 194; 115 LJCh 158; 174 LT 428; 2nd Digest Supp
Gilmour v Coats - [1949] 1 All ER 848; [1949] AC 426; [1949] LJR 1034; 2nd Digest Supp
Jones v Williams - (1767), Amb 651; 27 ER 422; 8 Digest 244, 36
Income Tax Special Purposes Comrs v Pemsel - [1891] AC 531; 61 LJQB 265; 65 LT 621; 55 JP 805; 3 Tax Cas 53; 8 Digest 241, 1
Re Grove Grady - [1929] 1 Ch 557; Digest Supp
Re Drummond - [1914] 2 Ch 90; 83 LJCh 817; 111 LT 156; 8 Digest 244, 28
Re Rayner - (1920), 89 LJCh 369; 122 LT 577; 84 JP 61; Digest Supp
Admiralty Comrs v Valverda (Owners) - [1938] 1 All ER 162; [1938] AC 173; 107 LJKB 99; 158 LT 281; Digest Supp
Hall v Derby Sanitary Authority - (1885), 16 QBD 163; 55 LJMC 21; 54 LT 175; 50 JP 278; 8 Digest 243, 26
Isaac v Defriez - (1754), Amb 595; 27 ER 387; 44 Digest 890, 7479
Gibson v South American Stores (Gath and Chaves) Ltd - [1949] 2 All ER 18; [1949] Ch 572; [1949] LJR 1228; affd in part and revsd in part; [1949] 2 All ER 985; [1950] Ch 117; 2nd Digest Supp
Spiller v Maude - (1881), 32 ChD 158 n; 8 Digest 348, 1412
Re Gosling - (1900), 48 WR 300; 8 Digest 244, 27
Re Buck - [1896] 2 Ch 727; 65 LJCh 881; 75 LT 312; 60 JP 775; 8 Digest 262, 246
Re Sir Robert Laidlaw's Will Trusts - (1935), unreported
Verge v Somerville - [1924] AC 496; 131 LT 107; sub nom A-G for Australia v Somerville; 93 LJPC 173; Digest Supp
Judgment date: 13 December 1950
Decision by:
Lord Morton of Henryton
My Lords, I have had the privilege of reading in print the opinions which have just been delivered by my noble and learned friends, Lord Simonds and Lord Normand. I agree with these opinions, but, as I was a party to the decisions of the Court of Appeal in Re Compton and Re Hobourn Aero Components Ltd's Air Raid Distress Fund, it is, perhaps, appropriate that I should say a few words about these and certain other cases. Counsel for the appellant submitted that the observations of Lord Greene MR (with which I concurred) in Re Compton, and of myself in the latter case, in regard to trusts for the employees of a particular company, were ill founded. I have re-considered these observations with great care in the light of the argument submitted on this appeal, and I see no reason to qualify any of them.
In the last portion of his speech, my noble and learned friend on the Woolsack referred to the "poor relations" cases, of which, perhaps, the most notable is Isaac v Defriez. In Re Compton Lord Greene MR considered these cases and observed ([1945] 1 All ER 206):
"The cases must at this date be regarded as good law although they are, perhaps, anomalous."
In the course of the argument, your Lordships' attention was called to a line of much more modern decisions which might possibly be described as the descendants of the "poor relations" cases. Recently, in Gibson v South American Stores (Gath and Chaves) Ltd, the Court of Appeal had to consider the trusts of a fund called "Employees' Health and Relief Fund" established by the defendant company. The board of the company had executed a deed vesting a fund in trustees and declaring (by cl 3) that it was to be used for granting, at the discretion of the board, gratuities, pensions or allowances to beneficiaries. By cl 4 it was declared that the class of beneficiaries included:
"all persons who in the opinion of the London board are or shall be necessitous and deserving and who for the time being are or have been in the company's employ or in the employ of any agents of the company or in the employ of [a subsidiary company] and the wives widows husbands widowers children parents and other dependents of any person who for the time being is or would if living have been himself or herself a member of the class of beneficiaries."
The Court of Appeal first held that, as a matter of construction, the trusts established in cl 3 and cl 4 were limited to necessitous beneficiaries. Sir Raymond Evershed MR having stated the above decision, continued ([1949] 2 All ER 992):
"That left as the next point for discussion what, it appeared, might well be a question of law of great difficulty and no little importance. The question may, I think, be put thus: Under the law as it has now been established, and in the light of several recent decisions, both in this court and in the House of Lords, is a trust for a class of poor persons defined by reference to the fact that they are employed by some person, firm, or company, a good charitable gift, a good charitable trust, or does it fail of that qualification through the absence of the necessary public element?"
If one omits the word "poor" the question thus posed is, in substance, the same as the question which arises on the present appeal. The learned Master of the Rolls then went on to consider Spiller v Maude, Re Gosling, Re Buck, and Re Laidlaw's Will Trusts, an unreported case decided by the Court of Appeal in 1935, and he felt constrained by the last mentioned authority to decide that the trust in Gibson's case was a valid charitable trust, notwithstanding the limited nature of the class of beneficiaries. The element of poverty of the beneficiaries was present in each of the cases considered by the learned Master of the Rolls, and, therefore, each case fell into the first of the four classes of charitable trusts laid down by Lord Machaghten in Pemsel's case ([1891] AC 583), whereas the present case falls into the second class. I think that for this reason your Lordships are of opinion that it is neither necessary nor desirable to express any view, on the present occasion, on the cases to which I have just referred. I am content to fall in with this opinion, only observing that they may require careful consideration in this House on some future occasion. I agree that the appeal must be dismissed with costs.