Legal Notice for Solicitation of Employees

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					 Charity

  charitable purposes
  subject to control of the High Court exercising its
   charitable jurisdiction




 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                  1                      1
 Charitable purpose

  one of the specified purposes AND
  for the public benefit




 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                  2    2
 Charitable purposes
    poverty; education; religion;
    advancement of health or the saving of lives (including the prevention or relief of
     sickness, disease or human suffering)
    advancement of citizenship or community development (including rural and urban
     regeneration; promotion of civic responsibility; volunteering; the voluntary sector;
     and the effectiveness or efficiency of charities)
  the arts, culture, heritage or science
    amateur sport
    human rights, conflict resolution or reconciliation or the promotion of religious or racial
     harmony or equality and diversity
    environmental protection and improvement
    the relief of those in need by reason of youth, age, ill-health, disability financial
     hardship or other disadvantage
    animal welfare
    efficiency of the armed forces, police, fire and rescue services or ambulance services
    other beneficial purposes
 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                               3                                              3
 Other beneficial purposes

  Analogous to or within the spirit of any other charitable
   purposes now or accepted in the future
  Express provision for continuing development of charity
   purposes




 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                  4                            4
 Art

  Public benefit –
     Access
     Merit
  CC publication – Museums and Art galleries, RR 10




 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                  5                    5
 Research

  Increase of knowledge combined with teaching or
   education
  Educational value or merit
  Benefit to public -
        Directed so as to lead to something which will pass into store of
         educational material available to the public or for use for the
         benefit of the public, or
        Directed so as to improve the sum of communicable knowledge
         in an area which education may cover

 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                      6                                      6
 Public benefit test

  No presumption
  Public benefit as understood for the purposes of the law
   relating to charities in England and Wales
  Guidance, awareness and understanding of public
   benefit
  Demonstrate actual public benefit or capability of being
   for the public benefit


 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                  7                           7
 Exempt charities

  Changes to the list of exempt charities
  Secretary of State can add or remove charities from the
   list
  Power of secretary of state to modify legislation relating
   to the charity on its removal from the list




 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                  8                             8
 Increased regulation of exempt charities


  Name change; inquiries; documents; scheme on application of
   Attorney General; small charities; Parliamentary Bill; dormant bank
   accounts; charity proceedings; repayment by disqualified charity
   trustees
  No s. 18 powers without inquiry
  Inquiry must be requested by the principal regulator
  Secretary of State may appoint principal regulator (body or Minister
   of State) and give necessary powers




 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                   9                                  9
 Restrictions on mortgaging

  Relaxation from specific loan to other types of
   arrangement
  Extension to mortgages to secure discharge of any
   obligation
  Relevant matter – resonableness having regard to
   charity’s purposes




 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                  10                   10
 Disposals of exhibits and/or collections

  Purpose(s) of the charity
  permanent endowment
  Museums Association guidance




 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                  11        11
 Charitable companies

  Income above £90,000 but below £500,000 per year
     Reporting accountant’s report if assets less than £2.8
      million
  Where charitable company part of a group, whether as
   parent or subsidiary – new increased thresholds




 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                  12                       12
 Duty to report concerning charitable companies


  Duties of and protections for auditors and independent
   examiners of other charities extended to auditors and
   reporting accountants of charitable companies




 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                  13                        13
 Remuneration of trustees (including connected persons) (1)


  Allowed for services to the charity if conditions are met –
     Agreed reasonable amount
     Trustee supplying services is in best interests of charity
     There are at least two trustees who are not entitled to receive
       remuneration
     There is no express prohibition to receive remuneration
  Provisions in trusts, court or Commission orders or statutory
   authority allowing trustee benefit are unaffected




 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                   14                                   14
 Remuneration of trustees (including connected persons) (2)


    Commission guidance
    Duty of care in s. 1(1) Trustee Act 2000 applies
    Connected persons are defined in the section
    Commission may disqualify a trustee from receiving
     remuneration where the trustee has participated in
     decision



 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                  15                          15
 Breach of trust – relief from liability


  Charity trustees, trustees, scrutineers of accounts
  Commission by order
      capacity as charity trustee etc
      honestly, reasonably and ought fairly to be excused
  whole or part relief – relief on such terms as the Commission thinks
   fit
  3rd party interests – order has no effect
  S. 61 Trustee Act 1925 and S. 727 Companies Act 1985 (as
   extended by the Bill) are unaffected



 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                    16                                16
 Trustee indemnity insurance

    Charity trustees given power to purchase TII out of the funds of the charity
    Conditions set out in the Bill (Secretary of State may amend by regulations)
    Charity trustees must be satisfied that it is in the best interests of the charity
    Duty of care in s. 1(1) Trustee Act 2000 applies
    Express prohibition of trustees benefiting at cost of charity does not prevent
     statutory power to purchase
    Express prohibition of TII at cost of charity prevents statutory power




 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                          17                                         17
 Fundraising (1)

  Stricter requirements relating to notice given in
   solicitation of amount taken by fundraisers and
   commercial participators
  Requirement for paid officers, trustees and employees of
   charity or connected company to give notice in
   solicitation of the fact of their office, trusteeship or
   employment and the fact that they are remunerated



 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                  18                     18
 Fundraising (2)

  Reserve power to Secretary of State to control
   fundraising by charities
  Initially to be controlled by self-regulation




 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                  19                19
 Charitable incorporated organisations (1)


    Details in schedule (7) of the Bill
    New legal form
    Created specially for charities
    Benefit of incorporation
    One regulator (Commission) instead of two
    Conversion from –
       charitable companies not limited by shares
       registered industrial and provident societies not limited by shares
       community interest companies – regulations of the Secretary of
        State

 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                     20                                  20
 Charitable incorporated organisations (2)


  Amalgamation
  Body corporate with constitution & principle office in England or
   Wales
  One or more members
  Charity trustees’ acts will bind CIO with regard to 3rd parties who
   have given full consideration – constitutional limitations disregarded
  Usual protection for purchasers without actual notice
  Duty of charity trustees and members to exercise powers and
   functions in good faith for the purposes of the charity




 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                    21                                  21
 Charitable incorporated organisations (3)


    Duty and standard of care
    Secretary of State may allow for exclusion of duty of care in regulations or
     regulation may allow for exclusion in the constitution
    Personal benefit by charity trustees –
       No authority for benefit expressly given in Bill
       Bill allows for benefit to be authorised in constitution
       Any charity trustee seeking authorised benefit must declare interest
         before transaction or arrangement agreed by the trustees




 Neil Mackenzie, Legal Services


New Charity Law and the Arts

                                        22                                          22

				
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