Charities (Amendment) Act 2006

i Charities (Amendment) Act 2006 Act No. 73/2006 TABLE OF PROVISIONS Section Page PART 1—PRELIMINARY 1 1. Purposes 1 2. Commencement 2 PART 2—AMENDMENT OF CHARITIES ACT 1978 3 3. New Part IB inserted 3 PART IB—CHARITABLE TRUSTS 3 7J. Definitions 3 7K. Distribution to certain eligible entities 3 7L. Leave to apply trust fund for further purposes 5 7M. Inclusion of non-charitable purposes not to invalidate trust 6 4. Schedule inserted 7 PART 3—AMENDMENT OF RELIGIOUS SUCCESSORY AND CHARITABLE TRUSTS ACT 1958 8 5. Change of name 8 6. New Part III substituted 8 PART III—TRANSITIONAL 8 61. Change of name of Act 8 7. References to Act name 8 PART 4—AMENDMENT OF PROPERTY LAW ACT 1958 9 8. Repeal of section 131 9 ═══════════════ ENDNOTES 10 -- 1 of 11 -- 1 Charities (Amendment) Act 2006 † [Assented to 10 October 2006] The Parliament of Victoria enacts as follows: PART 1—PRELIMINARY 1. Purposes The main purposes of this Act are— (a) to amend the Charities Act 1978— (i) to enable the trustees of a charitable trust to provide money, property or benefits to or for, or for the establishment of, certain eligible entities; and Victoria No. 73 of 2006 -- 2 of 11 -- Part 1—Preliminary Charities (Amendment) Act 2006 Act No. 73/2006 2 (ii) to re-enact with amendments section 63 of the Religious Successory and Charitable Trusts Act 1958 to provide power for the Supreme Court to grant leave for a charitable trust fund to be applied for further purposes; and (iii) to re-enact section 131 of the Property Law Act 1958 to provide for the validity of certain charitable trusts; and (b) to repeal sections 61 and 63 of the Religious Successory and Charitable Trusts Act 1958 and to rename that Act; and (c) to repeal section 131 of the Property Law Act 1958. 2. Commencement This Act comes into operation on the day on which it receives the Royal Assent. __________________ s. 2 -- 3 of 11 -- Part 2—Amendment of Charities Act 1978 Charities (Amendment) Act 2006 Act No. 73/2006 3 PART 2—AMENDMENT OF CHARITIES ACT 1978 3. New Part IB inserted After Part IA of the Charities Act 1978 insert— 'PART IB—CHARITABLE TRUSTS 7J. Definitions In this Part— "charitable trust" means a trust created for a charitable purpose; "trust fund" means any property subject to a charitable trust. 7K. Distribution to certain eligible entities (1) The powers of the trustees of a charitable trust include a power to provide money, property or benefits to or for an eligible entity, or for the establishment of an eligible entity, that, but for a connection to government, would be a charity to or for which, or for the establishment of which, money, property or benefits could be provided in accordance with the trust instrument. (2) Sub-section (1) applies despite any provision to the contrary in the trust instrument. (3) Sub-section (1) does not apply to the trustees of a charitable trust unless there is in force a declaration to the effect of the form in the Schedule in respect of the trust. (4) The exercise of a power conferred by sub- section (1) on the trustees of a charitable trust does not affect the status of the trust as a charitable trust. See: Act No. 9227. Reprint No. 2 as at 10 February 2000 and amending Act Nos 74/2000, 11/2005 and 29/2006. LawToday: www.dms. dpc.vic. gov.au s. 3 -- 4 of 11 -- Part 2—Amendment of Charities Act 1978 Charities (Amendment) Act 2006 Act No. 73/2006 4 (5) The provision, before the commencement day, by the trustees of a charitable trust of money, property or benefits to or for an eligible entity, or for the establishment of an eligible entity, that, but for a connection to government, would be a charity to or for which, or for the establishment of which, money, property or benefits could have been provided in accordance with the trust instrument— (a) is deemed to be, and always to have been, a provision for a valid purpose; and (b) does not affect, and is deemed never to have affected, the status of the trust as a charitable trust. (6) Sub-section (5) applies despite anything to the contrary in the trust instrument. (7) For the purposes only of this section the factors that may be taken into account in determining whether an eligible entity may be taken to be connected to government include— (a) the extent to which the eligible entity is under government direction or control; or (b) the extent to which the eligible entity is required to implement government policy; or (c) the extent to which a government can appoint, or direct or control the appointment of, the members of the governing body of the eligible entity— whether or not the eligible entity receives government funding. s. 3 -- 5 of 11 -- Part 2—Amendment of Charities Act 1978 Charities (Amendment) Act 2006 Act No. 73/2006 5 (8) In this section— "commencement day" means the date of commencement of the Charities (Amendment) Act 2006; "eligible entity" means a deductible gift recipient within the meaning of the Income Tax Assessment Act 1997 of the Commonwealth; Note: See section 30-227 of the Income Tax Assessment Act 1997 of the Commonwealth. "government" means the government of the Commonwealth or of a State or Territory or of any municipality of a State or Territory. 7L. Leave to apply trust fund for further purposes (1) On the application of the trustees or the administrator of any charitable trust (whether created before, on or after 1 April 1959) the court may grant leave empowering the trustees or the administrator— (a) to apply the trust fund for such further purposes as are necessary or desirable in order to carry out the purposes of the trust or to make them fully effective or are incidental to the carrying out of those purposes; and (b) without affecting the generality of paragraph (a), if the carrying out of the purposes of the trust will impose on a charity an expense that is not adequately met by payments made pursuant to the trust, to apply such portion of the trust fund as is proper to meet those expenses. s. 3 -- 6 of 11 -- Part 2—Amendment of Charities Act 1978 Charities (Amendment) Act 2006 Act No. 73/2006 6 (2) If leave is granted, the trustees or the administrator (as the case may be) may exercise the power subject to and in accordance with that leave. (3) Any trustees or administrator wishing to obtain leave under this section may apply to the court by summons to which the Attorney- General is to be made a party. (4) In this section "administrator" means any person (other than the trustees) administering a trust fund. Note: This section re-enacts (with amendments) section 63 of the Religious Successory and Charitable Trusts Act 1958. 7M. Inclusion of non-charitable purposes not to invalidate trust (1) A trust is not to be held to be invalid by reason that some non-charitable and invalid as well as some charitable purpose or purposes is or are or could be deemed to be included in any of the purposes to or for which that trust directs or allows the trust funds or any part of the trust funds to be applied. (2) A trust referred to in sub-section (1) is to be construed and given effect to in the same manner in all respects as if no application of the trust funds or of any part of the trust funds to or for the non-charitable and invalid purpose had been or should be deemed to have been so directed or allowed. (3) This section does not apply to a trust declared before, or to the will of any testator dying before, 26 October 1914. Note: This section re-enacts section 131 of the Property Law Act 1958.'. s. 3 -- 7 of 11 -- Part 2—Amendment of Charities Act 1978 Charities (Amendment) Act 2006 Act No. 73/2006 7 4. Schedule inserted After section 17 of the Charities Act 1978 insert— "SCHEDULE DECLARATION BY TRUSTEES The Trustees of the [Insert name of charitable trust], after having regard to the effect of this declaration on the liability of the trust to income tax, declare that the power conferred by section 7K of the Charities Act 1978 to provide money, property or benefits to or for an eligible entity, or for the establishment of an eligible entity, within the meaning of that section, is approved as a power that the trustees for the time being of the [Insert name of charitable trust] are authorised to exercise. DATED EXECUTED AS A DEED". __________________ s. 4 -- 8 of 11 -- Part 3—Amendment of Religious Successory and Charitable Trusts Act 1958 Charities (Amendment) Act 2006 Act No. 73/2006 8 PART 3—AMENDMENT OF RELIGIOUS SUCCESSORY AND CHARITABLE TRUSTS ACT 1958 5. Change of name In section 1 of the Religious Successory and Charitable Trusts Act 1958 for "Successory and Charitable" substitute "and Successory". 6. New Part III substituted For Part III of the Religious Successory and Charitable Trusts Act 1958 substitute— "PART III—TRANSITIONAL 61. Change of name of Act On and from the commencement of section 5 of the Charities (Amendment) Act 2006, in any Act (other than this Act) or in any instrument made under any Act or in any other document of any kind, any reference to the Religious Successory and Charitable Trusts Act 1958 is deemed to be a reference to the Religious and Successory Trusts Act 1958 so far as it applies to any period on or after that commencement, unless the contrary intention appears.". 7. References to Act name In the Second Schedule, Fourth Schedule, Fifth Schedule, Sixth Schedule and Eighth Schedule to the Religious Successory and Charitable Trusts Act 1958 for "Religious Successory and Charitable Trusts Act 1958" (wherever occurring) substitute "Religious and Successory Trusts Act 1958". __________________ See: Act No. 6357. Reprint No. 3 as at 6 March 1997 and amending Act No 85/1998. LawToday: www.dms. dpc.vic. gov.au s. 5 -- 9 of 11 -- Part 4—Amendment of Property Law Act 1958 Charities (Amendment) Act 2006 Act No. 73/2006 9 PART 4—AMENDMENT OF PROPERTY LAW ACT 1958 8. Repeal of section 131 Section 131 of the Property Law Act 1958 is repealed. ═══════════════ See: Act No. 6344. Reprint No. 11 as at 19 May 2004 and amending Act Nos 108/2004, 18/2005, 71/2005, 82/2005 and 88/2005. LawToday: www.dms. dpc.vic. gov.au s. 8 -- 10 of 11 -- Charities (Amendment) Act 2006 Act No. 73/2006 10 ENDNOTES † Minister's second reading speech— Legislative Assembly: 10 August 2006 Legislative Council: 14 September 2006 The long title for the Bill for this Act was "to amend the Charities Act 1978 to make further provision for charitable trusts, to amend the Religious Successory and Charitable Trusts Act 1958 and the Property Law Act 1958 and for other purposes." Endnotes -- 11 of 11 --