S - Z


Trust law

The concept of a trust grew out of the branch of law known as Equity. In the early development of English law the Courts sought to enforce moral rights that were not otherwise provided for in statute, contract or specified by deed. A trust is a relationship recognised by Equity that arises where property is vested in a person or persons called the trustees, and which those trustees are obliged to hold for the benefit of other persons called beneficiaries. The interests of the beneficiaries will usually be laid down in the instrument creating the trust but may be implied or imposed by law. Trust law is divided between private and public or charitable trusts. Public trusts are very limited in their application and relate to the realisation of a particular purpose, for example the delivery of a charity’s objects. Thus charity law is a branch of trust law.

Private trusts are divided into: express, resulting and constructive trusts, and express trusts. The latter have further sub divisions but private trusts are rarely of relevance to trustees in the charity sector.

Voluntary organisation and voluntary sector

A voluntary organisation is one whose main focus is to deliver social benefit in a variety of forms, rather than to generate profit for distribution to its members. It will usually be governed by volunteers, be independent of government and seek to pass on its assets to a similar organisation should it stop functioning. A charity is an organisation with exclusively charitable purposes. Most charities, with certain exceptions, are registered with the Charity Commission under the provisions of the Charities Act 1993, section 3.

WCVA has defined the voluntary sector as encompassing organisations, formal or informal, which meet the following criteria:

  • informal or formal (ie with or without an adopted governing document)
  • independent (not controlled by a for profit organisation or the state; voluntary organisations must have a majority of non-statutory bodies, appointees or representatives on its board of trustees and a majority of non statutory members)
  • self governing
  • non profit distributing
  • benefits from a meaningful degree of philanthropy ie gifts in kind or of time (eg volunteers, non paid trustees)
  • established for public benefit

This definition is similar to that of the narrow voluntary sector in Kendal and Knapp (The voluntary sector in the UK (1996), Kendall J and Knapp M, John Hopkins Non-profit Sector Series 8, Manchester University Press), and includes:

  • most charities (for exceptions see below)
  • housing associations
  • community groups, informal and formal
  • self-help and mutual aid groups
  • sports groups with community benefit
  • religious groups with social benefit
  • campaigning non political groups
  • community businesses
  • credit unions

Charities which are not included are: NHS trust funds, Welsh Church Act Funds, school trust funds, places of worship, promoting and supporting religion, statutory charities, statutory museums, independent further education colleges, professional associations, charitable independent schools, charitable quasi autonomous non-governmental organisations, voluntary aided schools and exempt charities.

The Voluntary Sector Scheme, which outlines the relationship between the Welsh Assembly Government and the voluntary sector, has the following definition:

bodies (other than local authorities or other public bodies) whose activities:

a) are carried out otherwise than for profit, and

b) directly or indirectly benefit the whole or any part of Wales (whether or not they also benefit any other area)

Voluntary Sector Scheme para 1.1

This is enlarged upon later in the document as including:

voluntary organisations, community groups, volunteers, self-help groups, community co-operatives and enterprises, religious organisations and other not for profit organisations of benefit to communities and people in Wales

Voluntary Sector Scheme para 2.1