A charitable trust is a gift, to be applied consistently with existing laws, for the benefit of an indefinite number of persons, either by bringing their minds or their hearts under the influence of education or religion, by relieving their bodies from disease, suffering, or constraint, by assisting them to establish themselves in life, or by erecting and maintaining public buildings or works, or otherwise lessening the burdens of government; a gift to general public use, which extends to the poor as well as the rich. To create a valid trust, sufficient words, a definite subject, and an object are necessary. In charitable trusts, the object is generally uncertain. This is because if the object were clearly defined, it would cease to be charity and be governed by trust rules.
At one time it was held that charitable trusts were created by an act passed during Queen Elizabeth's reign, known as the statute of beneficial uses. However, it has been shown that these trusts existed long before that act was passed. Charitable trusts are recognized in all States of the Union, while some States have never adopted the statute at all. It is held that trusts, even when they are not in compliance with the statute, may be considered good if they are in compliance with its spirit. Uncertainty of the object is one of the characteristics of a charitable trust, and it has led to what is known as the “cy pres” doctrine, which is that the courts will interpret instruments creating charitable trusts so that if the exact object of the donor cannot be carried out the donation will be applied to something of a nature similar to that specified by the donor.
When a testator leaves property to his executors in such a manner that they are to be the sole judges of its use, and the executors die before the testator, it is doubtful whether the trust will come into existence, as the executors were the only persons who could designate for what the donation was to be applied. In some jurisdictions, the rule is that if the property can be applied to other than charitable needs, it can be considered indefinite.
In cases in which the particular charitable purpose does not exhaust the whole fund if from the instrument creating the fund, the intention appears that the entire amount is for charity, the surplus will be devoted to another charity and will not form a resulting trust for the heir or next of kin. A gift may be made to a charity that is no longer in existence. A gift to a specific charity will not fail because of the lack of a trustee.
After the trust has come into existence, if the purpose for which the trust was created fails for any reason, it will be applied to some other purpose of a similar character, so as to fulfill as nearly as possible the purpose for which it was intended.
Charitable trusts are not subject to the rule against perpetuities, which is that property cannot be tied up for more than a life or lives in being and 21 years thereafter. If property left to a charitable trust is limited to another estate, not a charitable trust, and the first estate is in violation of the rule against perpetuities, the trust will not be sustained; but after the trust comes into existence the rule against perpetuities is not applied to it. In New York, charitable trusts are governed by the same rules as others.
By English law all bequests for charitable purposes, to be valid, must be strictly for the public benefit; that is to say, in favor of institutions for the advancement of learning, science, and art; for the support of the poor; or for other objects connected with the welfare of the public; and such bequests include those in favor of the Church or of other religious bodies sanctioned by the law.
Bequests for superstitious purposes are null and void. A body of commissioners (the charity commissioners), under whose superintendence such benevolent trusts are placed, was established under the Charitable Trusts Act of 1853. They have the power to inquire into the administration of all English public charities.
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