A tale of two Trusts…

The long running dispute between Stradbroke Parish Council and the Stradbroke Charitable Trust (or is is the Stradbroke Trust?) took another turn this week with the Trust blinking first and paying the rent due on the Doctor’s surgery to the Council. (For background see Charitable Trust refuse to pay rent on Doctor’s Surgery)

The cheque was was accompanied by yet another letter suggesting that the Council had misunderstood the Trust and asking for a meeting. The Council have responded by inviting them to attend a parish council meeting (which would be held in public) and after some argument agreeing to get legal advice about the lease on the doctor’s surgery.

Part of the issue here is that the Stradbroke Charitable Trust (which to add to the confusion used to be called the Stradbroke Health Trust) is changing to become a “charitable incorporated organisation”. Basically a charity and company merged into one. The main benefit would be that the Trustees would no longer have personal liability in the event the charity had to be wound up.

This is perhaps an understandable aspiration for the Trust but it is actually impossible to change an unincorporated trust — like the Stradbroke Charitable Trust — into a charitable incorporated organisation (CIO) — like the newly established Stradbroke Trust.

What has to be done is all the assets of the old Charitable Trust have to be transferred to the new CIO and then the old trust can be wound up.

Apparently this has either already happened (according to an email from former Trustee and recently resigned parish councillor Gerald Jenkins) or is nearly finished according to the letter from the Stradbroke Trust to the Council.

The problem with all this is that the lease on the Doctor’s Surgery is between the Parish Council and the Stradbroke Charitable Trust (as successors to the Stradbroke Health Trust). The lease could be moved or to use more technical language assigned to the Stradbroke Trust but this requires the consent of the Council and the Stradbroke Charitable Trust have never even asked for this.

In fact they have simply started to use the new Stradbroke Trust name in correspondence with the council despite the fact that the two trusts have different (albeit overlapping) Trustees.

This might sound like splitting hairs but it is actually really important. The two trusts are not the same thing, they are completely different charities with different charity numbers. A lease cannot be transferred magically. Any freehold owner such as the Council would need to go through a due diligence process and get legal advice before doing this in order to ensure that the asset is protected.

Cllr Chris Edwards hit the nail on the head when he said several times that the intention of the lease is to protect the surgery. This is what matters. With the Trust suggesting that they want to use the surgery to raise money for other projects it is the Council’s job to ensure that this does not put the surgery at risk. Hopefully getting solid legal advice will be the start of the process to put the surgery back on a secure footing going forward.