Report No. 27
Section 92 and cypres
1. In connection with section 92, it may be of some use to draw attention to the legislation regarding cypres recently undertaken in England and to the provisions in the Bombay Public Trusts Act, 1950 (Bombay Act 29 of 1950) which have been followed by certain other States also. Some difficulties were felt in England by virtue of the limited scope of the cypres doctrine, whereunder, the court had power to direct the application of the income to another purpose only where the original object had failed, etc. It had no power to alter the objects of the trust so long as they could be carried on literally. Now, there might be cases where it would be desirable to alter the very purpose of application as mentioned in the trust instrument, because the original objects have been adequately provided for by other means, or have ceased to provide a suitable method of using the property, or have become obsolete or useless or prejudicial to the public welfare, or are not substantially beneficial to the class of persons for whom the endowment was intended originally.
2. The Nathan Committee1 went into great detail in this question. The Committee was satisfied that the most urgent need was to enable the Charity Commissioners to give timely assistance to those trustees who were administering trusts "no longer adapted to modern conditions". Since the alteration of the objects of charities (where the objects can still be executed) could only be done by a statutory power, the Committee recommended suitable legislation regarding cypres.
3. The Charities Act, 1960 (8 & 9 Eliz. 2 ch. 58) has carried out, to a large extent, the recommendations of the Nathan Committee. Briefly speaking, under section 13 of that Act the original purpose of a charitable gift can be altered to allow the property to be applied cypres, where the original purpose has been fulfilled or cannot be carried out according to the directions and the spirit of the gift, or provides the use for part only of the property, or where the property available by virtue of the gift and other property applicable for similar purposes can be used in conjunction, or where the purposes were laid down with reference to an area which has ceased to be a unit or a class of persons which has ceased to be suitable or where the original purposes have been adequately provided for by other means or ceased (as being useless or harmful to the community) to be in law charitable or ceased to provide a suitable and effective method of using the property available by virtue of the gift. Thus, a failure of the original purpose is not now the only ground for cypres.
4. Attention may also be drawn to section 56 read with section 55 of the Bombay Public Trusts Act, 1950, whereunder, on an application by the Charity Commissioner, etc., the court can sanction an alteration of theoriginal object. It provides that, if the court is of opinion that "the carrying out of such intention or object is not wholly or partially expedient, practicable, desirable, necessary or proper in the public interest", the court may direct the property or income of the public trust or any portion thereof to be applied cypres to any other charitable or religious purpose. For this purpose, it is lawful for the court to alter any scheme already settled or to vary the terms of any decree, etc., or the instrument of trust.
5. As to the application of section 92 to High Courts on the original side in relation to the local limits, see the decision cited below2.
6. The matter can be considered in detail3 when the Law of public trusts is revised.
7. The doctrine of cypres can even now be applied4 to suits under section 92. But its scope will, presumably, be limited by the rules of the English Law, as unmodified by statute.
1. Report of the Committee on the Law, etc., relating to Charitable Trusts, (1952) Cmd. 8710, paras. 299, 316, 319, 320, 329.
2. Fazlehussain v. Yusufally, AIR 1955 Born 55 (58), para. 4 (Shah J.).
3. The Hindu Religions Endowments Commission (1960-62), Report, p. 89, Chapter VI, para. 29 has also recommended adoption of sections 13-14, Charities Act, 1960.
4. See Muthukrishna v. Ramchandra, AIR 1919 Mad 659 (669), (Seshagiri Aiyyar J.).