Chancery Division
Published September 1, 2014
Garcha and Others v Charity Commission for England and Wales
Before Mr Justice Norris
Judgment August 5, 2014
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A judge determining whether to allow proceedings to be brought in respect of a charity, which proceedings the Charity Commission had refused to sanction, was exercising an original jurisdiction and not acting as an appellate court against the commissioners’ decision. Ultimately, the judge had to be satisfied that the commencement of litigation was the least unsatisfactory course having regard to the interests of the charity as a whole.
Mr Justice Norris so held in refusing an application by the executive committee of a registered charity, Sri Guru Singh Sabha Southall, for leave under section 115(5) of the Charities Act 2011 to claim a declaration that they were entitled to inspect the legal files of a predecessor committee’s solicitors on the ground that they believed that legal costs incurred had been unreasonably large.
By section 115 proceedings may be taken with reference to a charity if they are authorised by the commission or, should it refuse, by order of a judge of the Chancery Division.
Mr Howard Lederman for the claimants. The commission did not appear and was not represented.
MR JUSTICE NORRIS said that the principles to be applied on such an application were as follows:
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1. The court was exercising an original jurisdiction and was not acting as an appellate court against the commissioners’ decision.
2. The jurisdiction conferred by section 115(5) to grant leave to take proceedings was conferred in unrestricted terms, though earlier decisions might illuminate its exercise.
3. Although the court was exercising an original jurisdiction, the fact that the commission had refused permission to bring the proceedings was part of the evidence, and that prior decision was entitled to respect because of the expertise brought to bear in making it.
4. There had to be a legally sustainable claim to be advanced in the proceedings for which permission was sought, by which was meant one that had a real as opposed to a fanciful prospect of success.
5. That legally sustainable claim had to be advanced in good faith.
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6. Although a sustainable claim advanced in good faith was a necessary condition, it was not a sufficient condition, because the point of having a specific filter (in addition to the thresholds that had to be crossed under the Civil Procedure Rules in any event) was to prevent the resources of the charity being frittered away on internal disputes.
7. Finally, the court had ultimately to be satisfied that the commencement of litigation was the least unsatisfactory course having regard to the interests of the charity as a whole.
In the instant case the claimants had not satisfied that final test.
Solicitors: West London Law Solicitors.