Application of the doctrine of cy-pres

Application of the doctrine of cy-pres

1. Application of the doctrine of cy-près

Application of the doctrine of cy-près
By Ikram Abdul Sattar,
Ahmed Ibrahim Kulliyah of Laws, IIUM.

The cy-près is a doctrine that where a charitable trust's purposes are impossible or cannot
be fulfilled for whatever reason, the funds should be reapplied to purposes as close as
possible to the trust's original goals. The word cy-près means; as near as possible.
In Malaysia, there is no specific statutory provision to govern the doctrine of cy-pres.
Therefore, Malaysian courts refer to case law whenever an issue of cy-pres arises.
To apply the cy-pres doctrine to a failed charitable trust, the court will look at the intention
of the settlor, which must be towards a general charitable purpose. If the intention of the
settlor is towards a specific charitable purpose and it is impossible to execute it, the cy-pres
doctrine cannot be applied and the gift fails completely.
1

The cy-près doctrine applies to two different situations namely; initial failures and
subsequent failures.

INITIAL FAILURES
An initial failure occurs when a specific gift to a charity failed because it has ceased to exist
or the purpose has become impossible before the date of the gift. The gift is then never
effective.
For the court to invoke its jurisdiction, it must be satisfied that the donor wished to give to
charity as a paramount intent (and secondarily to this charity) rather than giving a gift to the
institution specified and only that institution. The court must satisfy a wider intention in
order to apply cy-pres. This is known as General Charitable Intention.
If there is no general charitable intention by the testator then the doctrine of Cy-Pres cannot
be applied and it becomes a resulting trust.
2

In the case of Re Rymer
3
; There was a legacy to ‘ rector for time being St. Thomas’s
Seminary for the education of priests in the diocese of the Westminister for the purposes of

1
Mohsin Hingun and Wan Azlan Ahmed in Equity and Trust in Malaysia, 2
nd
Edition P.167.
2
Graham Moffat, Gerry Bean, Rebecca Probert in Trusts Law: Text and Materials P. 944
3
[1891-94] All ER Rep 328 also reported in [1895] 1 Ch 19.

2. Application of the doctrine of cy-près

such seminary. Shortly before the testator’s death, the seminary had been closed, the
building sold, the student had been transferred to another seminary near Birmingham.
4
It
was held that the gift failed, as the testator had a specific but not a general charitable
intent, therefore it fell into residue. Thus, cy-pres cannot be applied in this case.

How to determine the general charitable intention:
The gift must show charitable intention but the settlor intended not just a gift to a particular
(failed) purpose or organisation, but a more general charitable intention.
In Re Satterthwaite's Will Trusts
5
, it was held that the charitable intention can be found in
cases where a non-existent charity is the recipient of the settlor's gift, as in Re Harwood.
In the case of Re Harwood
6
; a gift had been made to the peace society in Belfast which
society could not be shown to have ever existed. The Judge found that there was a general
intention to benefit societies aimed at promoting peace and the gift was therefore applied
Cy-Près. There was also a second gift in the Will to the Wisbech Peace Society which had
once existed but had ceased to exist prior to the Testator’s death and this gift was held to
have lapsed.
7

In the case of Biscoe V. Jackson [1887] 35 Ch.D 460, money was to be applied towards the
establishment of a Soup Kitchen in Shoreditch and a Cottage Hospital there. It was not
possible to apply the gift in the manner indicated. The Court of Appeal held that there was
sufficient general intention of charity for the benefit of the poor of Shoreditch to entitle the
court to execute the trust Cy-Près . It was decided in effect that the direction to establish a
soup kitchen and a cottage hospital was only one means of benefiting the poor of
Shoreditch whom there was a general intention of benefiting.
8


SUBSEQUENT FAILURES
Subsequent failures are where money has already been applied to a charitable purpose, and
that purpose has failed. It does not allow the next of kin of the original donor to recover any

4
Philip H. Pettit, Equity and the Law of Trusts, P. 342
5
[1966] 1 All ER 919
6
[1966] 1 All ER 919
7
www.kenyalawresourcecenter.org/2011/07/cy-pres-doctrine.html
8
ibid

3. Application of the doctrine of cy-près

money, as said in Re Wright
9
"Once money has been effectually dedicated to charity,
whether in pursuance of a general or a particular charitable intent, the testator's next of kin
or residuary legatees are forever excluded".
General Charitable Intention is irrelevant:
In a situation where a charity ceased to exist after the property has become vested in the
charity, the doctrine of Cy-pres will apply irrespective of whether there is a general
charitable intention by the testator or not. In this situation there is no resulting trust to the
donor.
In Re Slevin
10
the Court of Appeal considered a gift to an orphanage which closed after the
death of the testator but before his assets were administered. It was held that the gift did
not lapse and Kay L.J. said this about the operation of lapse generally – ‘Properly speaking, a
lapse can only occur by failure of the object in the lifetime of the testator; but it is possible
that a will might be so framed as that a subsequent failure of the object of the charitable gift
might occasion a resulting trust for the benefit of the testator's estate.’
11



9
[1954] Ch 347
10
[1891] 2 Ch 236
11
Mark Mullen, Redcliffe Chambers, Lincoln's Inn in “Initial or subsequent failure of a charitable gift?” P. 6