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Re Denley: re-evaluating its significance for non-charitable purpose trusts

Wilde, D. (2023) Re Denley: re-evaluating its significance for non-charitable purpose trusts. Law Quarterly Review, 139 (2). pp. 243-268. ISSN 0023-933X

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Abstract/Summary

Stating the law on non-charitable purpose trusts should be a straightforward matter in anticipation of the Law Commission’s review.1 But a disfiguring shadow is cast over the area by Re Denley's Trust Deed.2 A recent reminder noted that this judgment is now over 50 years old.3 According to Lewin on Trusts the case is ‘the leading authority concerning the validity of trusts for apparent non-charitable purposes’4 – although the text seems ultimately to conclude that it was a beneficiary trust rather than a purpose trust after all.5 But at the same time, it seems true to say that (on the best view of the case law) ‘Re Denley has … never been specifically relied on to uphold a non-charitable purpose trust.’6 The argument here will be that Re Denley is indeed best viewed as a beneficiary trust. That interpreting the decision as upholding a non-charitable purpose trust does not, as is commonly suggested, expand the scope of valid trusts: it instead involves taking what would have been a valid beneficiary trust anyway and downgrading it to something less; to something not fully recognisable as a trust at all. Furthermore, it will be argued that wider obiter dicta in the case do not have the potential value they are commonly thought to have for upholding non-charitable purpose trusts more generally. Overall, it will be suggested, Re Denley adds nothing of substance to the law on non-charitable purpose trusts. And, accordingly, many have attached too great a significance to the case.

Item Type:Article
Refereed:Yes
Divisions:Arts, Humanities and Social Science > School of Law
ID Code:111774
Publisher:Sweet & Maxwell

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