illegal, or legal but morally wrong on charity voting

illegal, or legal but morally wrong on charity voting

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silverfoxcc

Original Poster:

7,683 posts

144 months

Saturday 6th February 2016
quotequote all
This is the situation
A charity,lets call them charity A, has been given a bequest of over 50k from a member. At the time of writing it he suggested the trustees put it towards a project,which ,at the time, was not in existence ( lets say he suggested in 2005 putting it towards the building of a replica Aircraft and suggested several he would like to see flying) since then a project has commenced which fits his wish. Lets call this Charity B
now here is the 'dodgy' bit
Two of the trustees of chairy A are founder members of Charity B and a third is also a trustee of charity B
At a recent meemting of A's trustees it was a unanimous decision to donate a substantial amount of the bequest to Charity B
Now i thought that anyone who had vested interests i Carity B should announce them and abstain from voting. This, due to the unanimous decision wa no the case. As i asked
Legal, or have any laws been broken in voting for something they have a ested interest in?

TooMany2cvs

29,008 posts

125 months

Saturday 6th February 2016
quotequote all
silverfoxcc said:
This is the situation
A charity,lets call them charity A, has been given a bequest of over 50k from a member. At the time of writing it he suggested the trustees put it towards a project,which ,at the time, was not in existence ( lets say he suggested in 2005 putting it towards the building of a replica Aircraft and suggested several he would like to see flying) since then a project has commenced which fits his wish. Lets call this Charity B
now here is the 'dodgy' bit
Two of the trustees of chairy A are founder members of Charity B and a third is also a trustee of charity B
At a recent meemting of A's trustees it was a unanimous decision to donate a substantial amount of the bequest to Charity B
Now i thought that anyone who had vested interests i Carity B should announce them and abstain from voting. This, due to the unanimous decision wa no the case. As i asked
Legal, or have any laws been broken in voting for something they have a ested interest in?
Just to try to translate that mess to English...

Mr X dies. He donates £50k+ to charity A. This gift has no reservations, just a "suggestion" that it goes towards a particular purpose.
Some years later, charity B is started to do that purpose.
The trustees of charity A agree for charity A to donate a similar amount to Mr X's bequest to charity B.

What, exactly, is your point...?

Not only are charity A's trustees doing something they're perfectly entitled to do, but they seem to be fulfilling Mr X's wishes, even though they had no obligation to.

You seem to think that three of charity A's trustees somehow forced all the other trustees to do their bidding - how many trustees are there?

deeen

6,079 posts

244 months

Saturday 6th February 2016
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How about legal, and morally correct? Charity A has behaved in the way most likely to see his wish (replica built) fulfilled?

Jasandjules

69,825 posts

228 months

Saturday 6th February 2016
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I thought it was just me, but I agree as above, it would appear they've attempted to ensure his wishes were fulfilled?!

Countdown

39,690 posts

195 months

Saturday 6th February 2016
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Charity B trustees are "related parties" of Charity A. At the very least A needs to disclose in its Annual Report any payments made to B. There's also a potential conflict of interest. A should have a CoI policy and follow it in this situation. To be purer than Caesar's wife Trustees of B should not partake in any decisions made by A which have an impact on B.

But (afaik) there's nothing legally stopping them.

Hamish Finn

476 posts

107 months

Sunday 7th February 2016
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TooMany2cvs said:
Just to try to translate that mess to English...
You don't need to. This is not your thread.

silverfoxcc

Original Poster:

7,683 posts

144 months

Sunday 7th February 2016
quotequote all
Countdown
Thanks, you have read it correctly. Two trustees of A are involved with B, and one trustee of A is also a trustee of B. I would have expected that instead of the vote being unanimous that it should have been for example 5 for with three abstensions to make it above suspicion.




Chrisgr31

13,440 posts

254 months

Sunday 7th February 2016
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Charity trustees are obliged to act within the law and in the best interests of their charity. Seems to me that they have done exactly that in this case. Charity A had £50,000 for a project it wasn't doing, and therefore could do nothing with the money. They are allowed to give money to other charities as long as the aims and objectives are similar or tighter.

So no problem with money going to charity B and it allows the wishes of the original benefactor to be met. Everyone happy well in theory.

Bigyoke

152 posts

131 months

Sunday 7th February 2016
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Suspicion of what exactly? The vote was unanimous, so even if they had declared an interest and abstained the transfer of funds would still have happened, or do you think that had the others known ( how do you know they don't? )they wouldn't have voted for it?

s2kjock

1,677 posts

146 months

Sunday 7th February 2016
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silverfoxcc said:
Countdown
I would have expected that instead of the vote being unanimous that it should have been for example 5 for with three abstensions to make it above suspicion.
From a governance perspective, that may have been more appropriate, but as others have stated, it seems the donor's wishes have been complied with, and that is the most important issue here.

TooLateForAName

4,727 posts

183 months

Sunday 7th February 2016
quotequote all
What does the constitution of charity A say? (and Charity B)

Trustees should be acting to achieve the documented aims of their charity.

Might be worth a call to the charity commission to discuss.