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Disposals from museum collections
Museum Management and Curatorship (1991), 10,255-261
Disposals
from Museum Collections
A Note on Legal Considerations
in England and Wales
ADRIAN BABBIDGE
Twenty years ago the legal issues which obfuscate disposals from museum collections were described as ‘a muddy corner of the law through which some may attempt to drive a coach and horses’. ’ Today the water is no clearer and the postillions are more inclined to make a splash. It may be timely, therefore, to examine how English law bears on what can be one of the most controversial of museum issues. The laws of Scotland and Northern Ireland differ, of course, from those of England and Wales, and this paper does not consider their situation. Nor can it be prescriptive. Only Acts of Parliament and Statutory Instruments have the force of law; the courts alone can interpret the law authoritatively. The views expressed herein are not those of a lawyer, but of a practising museum worker. They are no more than personal opinions. Proposed disposals from museum collections should be subject to legal advice specific to each circumstance. Statutory
Control
A limited number of museums have disposals policies regulated by Act of Parliament. Such legislation is usually specific to institutions, and identifies whether, when and how disposals may be undertaken. Many British nationally funded museums function under Public Acts; a few Private Acts, usually promoted by local councils, provide a framework for a number of local authority museums. There are also a number of disposals from the London Transport Museum, for example, are idiosyncrasies: governed by the Historical Relics Scheme prescribed by the Transport Act (1962). Only the National Gallery and Tate Gallery are expressly forbidden from disposing of items in their collections. Although the National Gallery Act (1856) enabled Trustees to dispose in certain circumstances, a campaign during its revision as the National Gallery & Tate Gallery Act (1954) led to the rescission of those permissive powers, and barred disposals from the collections of both institutions, other than by transfer to other specified nationally funded museums where they might be more appropriately held. The Schedule listing those institutions has been adopted by subsequent Acts to enable transfers between national museums. The earliest of the Public Acts still in force-the Imperial War Museum Act (192O)-is in many ways a prototype for those which followed. It permits its Trustees to exchange, sell or otherwise dispose of duplicate items and, with the ministerial consent, other objects no longer required for museum purposes. With similar consent, income from such disposals can be used to purchase to enhance the collections. These criteria were adopted without substantive variation in the National Maritime Museum Act (1934). 0260-4779/91/03
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The British Museum Act (1963), which governs both the British Museum and the Natural History Museum, is more specific. It allows exchange, gift or other disposal of duplicates, printed material after 1850 of which there is a photographic record, and material useless due to damage, physical deterioration or infestation. There is also a more general permission for the Trustees to dispose of items which, in their opinion, are ‘unfit to be retained and when disposal would not be to the detriment of students’, but only when such action would not be inconsistent with the conditions of a gift or bequest. The National Heritage Act (1983), under which the Victoria & Albert Museum, Science Museum and Royal Armouries are regulated, and the Merseyside Museums & Galleries Order (1986), are similar to the British Museum Act except that they allow for specific trusts or conditions to be overriden where damage, deterioration or infestation makes them useless. This legislation, as with the British Museum Act, requires income from disposals to be applied to purchase of objects for the collections. The Museum of London Acts (1965 and 1986) permit exchange, sale or other disposals of duplicates, or objects no longer required for museum purposes; income derived is to be applied to purchases for the collection. Exceptionally, disposal under the Museum of London Act requires a two-thirds majority of the Museum’s Board. None of these Acts includes controls over disposal which are as rigorous as those embodied in the Museums & Galleries Commission’s Guidelines for a Registration Scheme for Museums in the United Kingdom (1988). Some museums have, however, introduced their own internal systems or Standing Orders to reinforce the legislative The Museum of London, for example, requires an external assessor to requirements. report on a proposed disposal; transfer to other museums is the preferred option, and only if that is not appropriate does the item go to sale by public auction. Other relevant legislation may be found in Private (‘Local’) Acts, intended to extend the range of its sponsor’s powers beyond those conferred by public legislation. A local authority may sponsor such an Act for its own purposes, or several authorities may work together in promoting such legislation for their mutual benefit. Occasionally such Acts-which tend to be omnium gatherum of miscellaneous powers-include museum provisions, and some of these concern disposal from collections. For example, Section 149 of the Greater Manchester Act (1981) allows, inter u&a, disposal of items in the City Council’s art galleries for any reason, but requires the proceeds of any such action to be applied to the acquisition of other works. In the case of gifts or bequests, the governing body is required, if practicable, to consult with donors, or their personal representatives or trustees-who have a right of veto for 21 years following the gift or bequest-before exercising their power of disposal. Similarly, Section 58 of the County of Lancashire Act (1984), which applies to district councils in Lancashire, restricts disposals to loan, exchange or gift to other museums, subject to consultation with donors or their personal representatives where appropriate, with a 35year right of veto over such action from the date of gift or bequest. The Section also includes the requirement for any income received in this way to be applied to the ‘purchase of specimens, works of art, or books’.
The Cottesloe
Report
Although a few fortunate museums have disposals regulated by Public or Private Acts, the majority of museums in England and Wales-whether governed by local authorities, independent trustees or universities-have to look to the Common Law for guidance. For the past 30 years the opinion given in the Report of the Committee of Enquiry into the Sale of Works of Art by Public Bodies (1964) has been widely regarded as authoritative
ADRIAN BABBIDGE
in this respect.
The Committee,
chaired
by Viscount
257
Cottesloe,
asserted
the following:
The basic principle upon which the law rests is that when private persons give property for public purposes the Crown undertakes to see that it is devoted to the purposes intended by the donor, and to no others. When a work of art is given to a museum or gallery for general exhibition, the public thereby acquires rights in the object concerned and these rights cannot be set aside. The authorities of the museum or gallery are not the owners of such an object in the ordinary sense of the word: they are merely responsible, under the authority of the courts, for carrying out the intentions of the donor. They cannot sell the object unless authorized to do so by the courts, or by the Charity Commissioners or the Minister of Education on behalf of the courts, because they themselves have nothing to sell. If they attempt a sale in breach of trust, it is the function of the Attorney-General to enforce the trust and protect the rights of the public in the object by taking proceedings in the Chancery Division. It should be noted that administrative change during the intervening years has rendered the reference to the Minister of Education obsolete, since the Education Act (1973) removed powers of supervision over educational trusts from the Secretary of State and consolidated them with those of the Charity for Education and Science, Commission. The Commission thence became the only administrative body with There has been no other specific legislative change regulatory powers over charities. which might modify the advice given. This guidance has subsequently been embodied in the Museums Association’s Code of Practice for Museum Authorities (1977) and its several revisions, and in the Museums & Galleries Commission’s Guidelines for Museum Registration. As the only authoritative word on the subject, the Cottesloe opinion has gained a common acceptance amongst museum workers. It has not, however, been tested in the courts. It rests, fundamentally, on the belief that by the act of making a gift to a museum, a donor is creating a charitable trust.
The Charitable
Trust
A charitable trust is a legal relationship created when a person places assets for the public benefit under the control of trustees. Although there are similarities between charitable and other types of trust, only a charitable trust can be perpetual, and thereby provide the long-term security implied in the Cottesloe opinion. What constitutes such a trust is a matter for the courts, or for the Charity Commission, which acts for the courts in these matters. The law on which their decisions are taken is based on an Elizabethan statute as interpreted in subsequent court decisions. ’ It is the same foundation as that on which many independent museums are built, whether as unincorporated associations or trusts, or as companies limited by guarantee. However, charitable trusts can be created as much by gifts to local authorities and chartered bodies as to independent museums. To constitute a charitable trust, a gift must meet a number of criteria. The intention of the gift must be certain; it must fall wholly and exclusively within the general criteria of what is charitable; and it must be for the public benefit. Case-law that donations to existing museums can be charitable gifts is long-standing, and goes back to 1826;3 subsequent judgements have held that gifts of objects of art to form a museum open to the public are valid charitable gifts, as being of public utility or benefit.4 The general principle that gifts to museums have the potential for charitable status is clear. However, in practice, this status has to be proved for each individual gift. There are a number of issues which need to be considered in establishing charitable
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Disposals from Museum Collections
status. There needs to be a benefit to the general public, which implies access and availability. Indeed, the Cottesloe opinion limits its definition of ‘protected’ items to those ‘given to a museum or gallery for general exhibition’. What about those items held in reserve collections, or infrequently exhibited, for whatever reason? The quality of the item may also be an issue, as suggested in the judgement of Lord Justice Harman in Re Pinion :5
. . . where a museum is concerned and the utility of the gift is brou ht into question it is, in my opinion, essential to know at least something of the qua iiity of the proposed exhibits in order to judge whether they will be conducive to the education of the public . . . Here it is suggested that education in the fine arts is the object . . . there is a strong body of evidence here that as a means of education this collection is worthless. . . . there is a haphazard assembly . . . of furniture and objects of so-called ‘art’ about which expert opinion is unanimous that nothing beyond the third-rate is to be found. It was said that this is a matter of taste . . . but here I agree with the judge that there is an accepted canon of taste on which the Courts must rely, for it has itself no judicial knowledge of such matters, and the unanimous verdict of the experts is as I have stated . . . I can conceive of no useful object to be served in foisting upon the public this mass of junk. It has neither public utility or educative value . . .’ The evidence required to prove a charitable trust-whether by Agreement, the will which makes a bequest, correspondence, council minutes or the like-must be strong and specifically identify the nature of the gift. Complete and exact contemporary documentation is essential. Whatever the evidence, it should clearly indicate the form and charitable intent of the gift, and its nature must be such that it is capable of being accepted and used as intended; there must also be a certainty that at the time of acquisition it would be used for those purposes and no other. There is no doubt that the standard forms and documentation systems used in British museums do not by themselves have the potential to prove any such trust.
Enforcement
of Charitable
Trusts
Intended disposal in such cases would require sanction by the courts or by the Charity Commission. If such permission is not sought, then action may be taken through the Attorney-General, who usually acts on the information of the Charity Commission, though he can act independently of it. Proceedings would commence with a summons in the Chancery Division of the High Court. The Attorney-General would come to court as an Officer of the Crown informing the judge, as another Officer of the Crown, of the breach of trust or neglect of duty which requires remedy. The court would hear the evidence and if satisfied that the action taken or proposed was against the public interest could order an injunction for its restitution or prohibition of disposal. Although the Attorney is the only party who can conduct such actions, it is possible for a private citizen or a body corporate, or group thereof, to initiate proceedings as (a) relator(s). A relator need have no personal interest in the matter and the only qualifications are that they have not been disqualified from bringing actions for the usual reasons, and not be indigent; a written authority to so act, endorsed by a solicitor, is lodged at the District Registry. Although the carriage for the action, the relator has no status in determining its progress. Thus, for example, if part way through the proceedings the Attorney wishes to discontinue, the relator cannot prevent this. However, a relator is liable for costs, and indeed is normally introduced to relieve the Attorney of such liability.
ADRIAN BABBIDGE
Special Issues for Independent
259
Museums
Independent museums are often registered charities. Their establishment has invariably demanded the establishment of a Trust Fund, either by way of an initial endowment or, if a company, by the guarantee of its members. The primary duty of its trustees is to maintain that Fund to meet those objects specified in its governing instrument. Where museum collections are part of the Trust Fund, the trustees are required by law to seek the consent of the Charity Commission for any disposal. The duty of the Commission, however, is not to superintend good curatorial practice and help preserve collections, but to maintain the value of the Trust Fund. Trustees also have a duty in the case of a disposal of assets to undertake that task in a manner which brings the most benefit6 These requirements mean that disposal other than by open sale to the highest bidder-notwithstanding that the most appropriate curatorial solution might be by transfer to another museum-could be a breach of trust. Some Trust Deeds’ have addressed this problem by separating museum collections from the Trust Fund in their governing instrument, but this might remove oversight of disposals from the Commission. Nor does it resolve the issue as to whether disposal should always be by sale to the highest bidder, with the possibility of any contrary action being subject to challenge in the courts. A more considerable problem arises on a charity being wound up. Where there are funds available to meet all outstanding debts then the transfer of collections to a like institution may be effected, subject to the Charity Commission’s consent. However, where funds are insufficient to meet all debts there is a charge on the collection to the extent required to meet those liabilities. The general rule is that the interests of creditors are the first priority, of its charitable objects second, and of its employees third. Although charity trustees have an obligation to prevent any charge falling on its Trust Fund, and thereby are responsible for underwriting any shortfall, this is often incapable of implementation. In this case the collections would be at risk of liquidation to meet the museum’s debts.
Special Issues for Local Authority
Museums
The basis for the operation of local authorities has seen substantial change in recent years. From the time of the Municipal Corporations Acts of the 183Os, local authorities, whilst not charitable corporations in themselves, were seen as trustees of the property they held for public purposes and for the benefit of their ratepayers. As such they were accountable to the courts in the same way as charity trustees. This characteristic of local government has diminished in recent years, with local councils assuming a quasi-trading role, with greater freedom to buy and sell. Whilst past disposals of public assets would have required Treasury consent, later delegated to appropriate ministers acting on behalf of the Crown, such consents are no longer routinely required. Since the legislative basis for local authority museums-the Public Libraries & Museums Act (1964)-was enacted at a time when there was tighter regulation of property disposals by central government, it is perhaps not surprising that it does not consider this matter. The Act (s 12) simply enjoins a local authority ‘to provide and area or elsewhere, in England and Wales maintain museums . . . within its administrative or expedient in connection with the . . . and do all such things as may be necessary maintenance or provision thereof’. The only mention of disposals (s 15, Schedule 2) is in a model management scheme for the cumulative purchase funds enabled by this enactment.
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Disposals from
Museum
Collections
It includes a requirement that proceeds from disposal by sale are to be applied as income to such funds. Perhaps of greater significance, the Act fails to identify the legal status of gifts to museums. In the absence of museum-specific requirements, the general legislation concerning gifts to local authorities must be examined. Both the Education Act (1944) and L ocal Government Act (1972) make reference to the status of gifts received by local authorities. Section 85 of the former says: or former . . . a local education authority shall have power, and any such authority authority shall be deemed always to have had power, to accept, hold and administer any property upon trust for purposes connected with education and Section
I39 of the latter:
Subject to the provisions of this section [local authorities] may accept, hold and administer (a) for the purpose of discharging any of their functions, gifts of property, whether real or personal, made for that purpose or (b) for the benefit of the inhabitants of their area or some part of it, gifts made for that purpose and may execute any work (including works of maintenance or improvement) incidental or consequential on the exercise of powers conferred by that section . . . . Although gifts made in these ways constitute trusts, they are unlikely to be charitable. Both the Local Acts referred to before, Greater Manchester and Lancashire, with their 2I- and 35-year powers of veto over disposal to donors, suggest that, since they are not perpetual, they cannot be charitable. Case-law shows the difficulty of creating charitable trusts with the local authority as trustee. The judgement in Re Enducott (1960)8 decided that the nature of a local authority’s activities is not so clearly defined as being of a charitable character as to impose a charitable limitation on the words of a gift to that authority, as the statutory power of the council is not confined to charitable purposes. It is probable, therefore, that without the most specific terms of gift, donations to local authorities are not charitable and fall outside the scope of the Cottesloe opinion.
The Future The legal status of museum collections is not clear. The years since the Cottesloe opinion in 1964 have seen changes-particularly in terms of the nature of local authorities-which have cascaded to erode the foundations of trusteeship on which public museum collections have depended. Future trends will probably exacerbate the situation. The position of independent museums is no more satisfactory. Recent reports’ have recommended that the Charity Commission relax its regulation of charities, including those over disposal of property. Past controls, such as they were, will disappear to enable charity trustees to do what they believe to be best for their organizations. The likelihood of intervention by the Attorney-General in any case concerning museum disposals, given evidential and other requirements to prove charitable status, seems remote. The only positive note is the Museums & Galleries Commission’s Registration Scheme which, although voluntary, does provide a potential financial sanction (withdrawal of eligibility for its and Area Museum Council grant schemes) for those which transgress its disposals code. Taken with public opinion, these could be powerful deterrents to unsound disposals. Recent events-notably the sale of museum collections by
ADRIAN BABBIDGE
261
Derbyshire County Council-have shown, however, that in certain circumstances these deterrents can be ineffective. Full legislative control over disposals from museum collections is unlikely to be However, there needs to be some formal-and promoted by the government. binding-reaffirmation of the Cottesloe opinion if public confidence in the custodial role of museums is to be sustained. The Museums & Galleries Commission’s recently published report on local authorities and museumslo suggests that a government circular issued jointly by the Department of the Environment and territorial departments might be useful. Without the sanction of the courts, however, any such directive could only be on disposals from a paper tiger, and in any case would have only limited influence museums subject to the oversight of the Charity Commission. Whether by legislation, creation of precedent by an action in the courts or by judicial review, the matter must be addressed and resolved if public confidence is to be sustained.
Notes 1. John Jacob,
‘The Sale of Museum Objects: The Principles Involved, and an Account of Some Cases in Point’, Museums Journal, 71, 1971/2, pp. 112-115. 2. The Charitable Uses Act (1601), as classified by Lord Macnaghten in Commissioners JOY Spectal Puvposes of Income Tax v. Pemsel [I8911 AC 531 HL, and other judgements. 3. British Museum Trustees v. White (1826) 2 Sim & St, 594. 4. Re Holbourne, Coates v. Mckillop (1885) 53 LT 212; Re Spence, Barclays Bank v. Stockton on Tees Corporation [1937] 3 All ER 684. 5. Westminster Bank Ltd v. Pinion [1964] 1 All ER 890 CA. 6. For example, in Butt/e v. Saunders [1950] 2 All ER 193. 7. Including the draft Deed in Adrian Babbidge, Charitable Status for Museums, AIM Guideline 3 (revised edition 1989). 8. Corpe v. Endacott [1959] 3 All ER 562. 9. Home Office Efficiency Scrutiny of the Supervision of Charities (1987); Home Office Charities: A Framework for the Future (1989). 10. Museums & Galleries Commission,
Local Authorities
& Museums
(1991).
Disposals
from Museum Collections
A Note on Legal Considerations
in England and Wales
ADRIAN BABBIDGE
Twenty years ago the legal issues which obfuscate disposals from museum collections were described as ‘a muddy corner of the law through which some may attempt to drive a coach and horses’. ’ Today the water is no clearer and the postillions are more inclined to make a splash. It may be timely, therefore, to examine how English law bears on what can be one of the most controversial of museum issues. The laws of Scotland and Northern Ireland differ, of course, from those of England and Wales, and this paper does not consider their situation. Nor can it be prescriptive. Only Acts of Parliament and Statutory Instruments have the force of law; the courts alone can interpret the law authoritatively. The views expressed herein are not those of a lawyer, but of a practising museum worker. They are no more than personal opinions. Proposed disposals from museum collections should be subject to legal advice specific to each circumstance. Statutory
Control
A limited number of museums have disposals policies regulated by Act of Parliament. Such legislation is usually specific to institutions, and identifies whether, when and how disposals may be undertaken. Many British nationally funded museums function under Public Acts; a few Private Acts, usually promoted by local councils, provide a framework for a number of local authority museums. There are also a number of disposals from the London Transport Museum, for example, are idiosyncrasies: governed by the Historical Relics Scheme prescribed by the Transport Act (1962). Only the National Gallery and Tate Gallery are expressly forbidden from disposing of items in their collections. Although the National Gallery Act (1856) enabled Trustees to dispose in certain circumstances, a campaign during its revision as the National Gallery & Tate Gallery Act (1954) led to the rescission of those permissive powers, and barred disposals from the collections of both institutions, other than by transfer to other specified nationally funded museums where they might be more appropriately held. The Schedule listing those institutions has been adopted by subsequent Acts to enable transfers between national museums. The earliest of the Public Acts still in force-the Imperial War Museum Act (192O)-is in many ways a prototype for those which followed. It permits its Trustees to exchange, sell or otherwise dispose of duplicate items and, with the ministerial consent, other objects no longer required for museum purposes. With similar consent, income from such disposals can be used to purchase to enhance the collections. These criteria were adopted without substantive variation in the National Maritime Museum Act (1934). 0260-4779/91/03
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The British Museum Act (1963), which governs both the British Museum and the Natural History Museum, is more specific. It allows exchange, gift or other disposal of duplicates, printed material after 1850 of which there is a photographic record, and material useless due to damage, physical deterioration or infestation. There is also a more general permission for the Trustees to dispose of items which, in their opinion, are ‘unfit to be retained and when disposal would not be to the detriment of students’, but only when such action would not be inconsistent with the conditions of a gift or bequest. The National Heritage Act (1983), under which the Victoria & Albert Museum, Science Museum and Royal Armouries are regulated, and the Merseyside Museums & Galleries Order (1986), are similar to the British Museum Act except that they allow for specific trusts or conditions to be overriden where damage, deterioration or infestation makes them useless. This legislation, as with the British Museum Act, requires income from disposals to be applied to purchase of objects for the collections. The Museum of London Acts (1965 and 1986) permit exchange, sale or other disposals of duplicates, or objects no longer required for museum purposes; income derived is to be applied to purchases for the collection. Exceptionally, disposal under the Museum of London Act requires a two-thirds majority of the Museum’s Board. None of these Acts includes controls over disposal which are as rigorous as those embodied in the Museums & Galleries Commission’s Guidelines for a Registration Scheme for Museums in the United Kingdom (1988). Some museums have, however, introduced their own internal systems or Standing Orders to reinforce the legislative The Museum of London, for example, requires an external assessor to requirements. report on a proposed disposal; transfer to other museums is the preferred option, and only if that is not appropriate does the item go to sale by public auction. Other relevant legislation may be found in Private (‘Local’) Acts, intended to extend the range of its sponsor’s powers beyond those conferred by public legislation. A local authority may sponsor such an Act for its own purposes, or several authorities may work together in promoting such legislation for their mutual benefit. Occasionally such Acts-which tend to be omnium gatherum of miscellaneous powers-include museum provisions, and some of these concern disposal from collections. For example, Section 149 of the Greater Manchester Act (1981) allows, inter u&a, disposal of items in the City Council’s art galleries for any reason, but requires the proceeds of any such action to be applied to the acquisition of other works. In the case of gifts or bequests, the governing body is required, if practicable, to consult with donors, or their personal representatives or trustees-who have a right of veto for 21 years following the gift or bequest-before exercising their power of disposal. Similarly, Section 58 of the County of Lancashire Act (1984), which applies to district councils in Lancashire, restricts disposals to loan, exchange or gift to other museums, subject to consultation with donors or their personal representatives where appropriate, with a 35year right of veto over such action from the date of gift or bequest. The Section also includes the requirement for any income received in this way to be applied to the ‘purchase of specimens, works of art, or books’.
The Cottesloe
Report
Although a few fortunate museums have disposals regulated by Public or Private Acts, the majority of museums in England and Wales-whether governed by local authorities, independent trustees or universities-have to look to the Common Law for guidance. For the past 30 years the opinion given in the Report of the Committee of Enquiry into the Sale of Works of Art by Public Bodies (1964) has been widely regarded as authoritative
ADRIAN BABBIDGE
in this respect.
The Committee,
chaired
by Viscount
257
Cottesloe,
asserted
the following:
The basic principle upon which the law rests is that when private persons give property for public purposes the Crown undertakes to see that it is devoted to the purposes intended by the donor, and to no others. When a work of art is given to a museum or gallery for general exhibition, the public thereby acquires rights in the object concerned and these rights cannot be set aside. The authorities of the museum or gallery are not the owners of such an object in the ordinary sense of the word: they are merely responsible, under the authority of the courts, for carrying out the intentions of the donor. They cannot sell the object unless authorized to do so by the courts, or by the Charity Commissioners or the Minister of Education on behalf of the courts, because they themselves have nothing to sell. If they attempt a sale in breach of trust, it is the function of the Attorney-General to enforce the trust and protect the rights of the public in the object by taking proceedings in the Chancery Division. It should be noted that administrative change during the intervening years has rendered the reference to the Minister of Education obsolete, since the Education Act (1973) removed powers of supervision over educational trusts from the Secretary of State and consolidated them with those of the Charity for Education and Science, Commission. The Commission thence became the only administrative body with There has been no other specific legislative change regulatory powers over charities. which might modify the advice given. This guidance has subsequently been embodied in the Museums Association’s Code of Practice for Museum Authorities (1977) and its several revisions, and in the Museums & Galleries Commission’s Guidelines for Museum Registration. As the only authoritative word on the subject, the Cottesloe opinion has gained a common acceptance amongst museum workers. It has not, however, been tested in the courts. It rests, fundamentally, on the belief that by the act of making a gift to a museum, a donor is creating a charitable trust.
The Charitable
Trust
A charitable trust is a legal relationship created when a person places assets for the public benefit under the control of trustees. Although there are similarities between charitable and other types of trust, only a charitable trust can be perpetual, and thereby provide the long-term security implied in the Cottesloe opinion. What constitutes such a trust is a matter for the courts, or for the Charity Commission, which acts for the courts in these matters. The law on which their decisions are taken is based on an Elizabethan statute as interpreted in subsequent court decisions. ’ It is the same foundation as that on which many independent museums are built, whether as unincorporated associations or trusts, or as companies limited by guarantee. However, charitable trusts can be created as much by gifts to local authorities and chartered bodies as to independent museums. To constitute a charitable trust, a gift must meet a number of criteria. The intention of the gift must be certain; it must fall wholly and exclusively within the general criteria of what is charitable; and it must be for the public benefit. Case-law that donations to existing museums can be charitable gifts is long-standing, and goes back to 1826;3 subsequent judgements have held that gifts of objects of art to form a museum open to the public are valid charitable gifts, as being of public utility or benefit.4 The general principle that gifts to museums have the potential for charitable status is clear. However, in practice, this status has to be proved for each individual gift. There are a number of issues which need to be considered in establishing charitable
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status. There needs to be a benefit to the general public, which implies access and availability. Indeed, the Cottesloe opinion limits its definition of ‘protected’ items to those ‘given to a museum or gallery for general exhibition’. What about those items held in reserve collections, or infrequently exhibited, for whatever reason? The quality of the item may also be an issue, as suggested in the judgement of Lord Justice Harman in Re Pinion :5
. . . where a museum is concerned and the utility of the gift is brou ht into question it is, in my opinion, essential to know at least something of the qua iiity of the proposed exhibits in order to judge whether they will be conducive to the education of the public . . . Here it is suggested that education in the fine arts is the object . . . there is a strong body of evidence here that as a means of education this collection is worthless. . . . there is a haphazard assembly . . . of furniture and objects of so-called ‘art’ about which expert opinion is unanimous that nothing beyond the third-rate is to be found. It was said that this is a matter of taste . . . but here I agree with the judge that there is an accepted canon of taste on which the Courts must rely, for it has itself no judicial knowledge of such matters, and the unanimous verdict of the experts is as I have stated . . . I can conceive of no useful object to be served in foisting upon the public this mass of junk. It has neither public utility or educative value . . .’ The evidence required to prove a charitable trust-whether by Agreement, the will which makes a bequest, correspondence, council minutes or the like-must be strong and specifically identify the nature of the gift. Complete and exact contemporary documentation is essential. Whatever the evidence, it should clearly indicate the form and charitable intent of the gift, and its nature must be such that it is capable of being accepted and used as intended; there must also be a certainty that at the time of acquisition it would be used for those purposes and no other. There is no doubt that the standard forms and documentation systems used in British museums do not by themselves have the potential to prove any such trust.
Enforcement
of Charitable
Trusts
Intended disposal in such cases would require sanction by the courts or by the Charity Commission. If such permission is not sought, then action may be taken through the Attorney-General, who usually acts on the information of the Charity Commission, though he can act independently of it. Proceedings would commence with a summons in the Chancery Division of the High Court. The Attorney-General would come to court as an Officer of the Crown informing the judge, as another Officer of the Crown, of the breach of trust or neglect of duty which requires remedy. The court would hear the evidence and if satisfied that the action taken or proposed was against the public interest could order an injunction for its restitution or prohibition of disposal. Although the Attorney is the only party who can conduct such actions, it is possible for a private citizen or a body corporate, or group thereof, to initiate proceedings as (a) relator(s). A relator need have no personal interest in the matter and the only qualifications are that they have not been disqualified from bringing actions for the usual reasons, and not be indigent; a written authority to so act, endorsed by a solicitor, is lodged at the District Registry. Although the carriage for the action, the relator has no status in determining its progress. Thus, for example, if part way through the proceedings the Attorney wishes to discontinue, the relator cannot prevent this. However, a relator is liable for costs, and indeed is normally introduced to relieve the Attorney of such liability.
ADRIAN BABBIDGE
Special Issues for Independent
259
Museums
Independent museums are often registered charities. Their establishment has invariably demanded the establishment of a Trust Fund, either by way of an initial endowment or, if a company, by the guarantee of its members. The primary duty of its trustees is to maintain that Fund to meet those objects specified in its governing instrument. Where museum collections are part of the Trust Fund, the trustees are required by law to seek the consent of the Charity Commission for any disposal. The duty of the Commission, however, is not to superintend good curatorial practice and help preserve collections, but to maintain the value of the Trust Fund. Trustees also have a duty in the case of a disposal of assets to undertake that task in a manner which brings the most benefit6 These requirements mean that disposal other than by open sale to the highest bidder-notwithstanding that the most appropriate curatorial solution might be by transfer to another museum-could be a breach of trust. Some Trust Deeds’ have addressed this problem by separating museum collections from the Trust Fund in their governing instrument, but this might remove oversight of disposals from the Commission. Nor does it resolve the issue as to whether disposal should always be by sale to the highest bidder, with the possibility of any contrary action being subject to challenge in the courts. A more considerable problem arises on a charity being wound up. Where there are funds available to meet all outstanding debts then the transfer of collections to a like institution may be effected, subject to the Charity Commission’s consent. However, where funds are insufficient to meet all debts there is a charge on the collection to the extent required to meet those liabilities. The general rule is that the interests of creditors are the first priority, of its charitable objects second, and of its employees third. Although charity trustees have an obligation to prevent any charge falling on its Trust Fund, and thereby are responsible for underwriting any shortfall, this is often incapable of implementation. In this case the collections would be at risk of liquidation to meet the museum’s debts.
Special Issues for Local Authority
Museums
The basis for the operation of local authorities has seen substantial change in recent years. From the time of the Municipal Corporations Acts of the 183Os, local authorities, whilst not charitable corporations in themselves, were seen as trustees of the property they held for public purposes and for the benefit of their ratepayers. As such they were accountable to the courts in the same way as charity trustees. This characteristic of local government has diminished in recent years, with local councils assuming a quasi-trading role, with greater freedom to buy and sell. Whilst past disposals of public assets would have required Treasury consent, later delegated to appropriate ministers acting on behalf of the Crown, such consents are no longer routinely required. Since the legislative basis for local authority museums-the Public Libraries & Museums Act (1964)-was enacted at a time when there was tighter regulation of property disposals by central government, it is perhaps not surprising that it does not consider this matter. The Act (s 12) simply enjoins a local authority ‘to provide and area or elsewhere, in England and Wales maintain museums . . . within its administrative or expedient in connection with the . . . and do all such things as may be necessary maintenance or provision thereof’. The only mention of disposals (s 15, Schedule 2) is in a model management scheme for the cumulative purchase funds enabled by this enactment.
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Disposals from
Museum
Collections
It includes a requirement that proceeds from disposal by sale are to be applied as income to such funds. Perhaps of greater significance, the Act fails to identify the legal status of gifts to museums. In the absence of museum-specific requirements, the general legislation concerning gifts to local authorities must be examined. Both the Education Act (1944) and L ocal Government Act (1972) make reference to the status of gifts received by local authorities. Section 85 of the former says: or former . . . a local education authority shall have power, and any such authority authority shall be deemed always to have had power, to accept, hold and administer any property upon trust for purposes connected with education and Section
I39 of the latter:
Subject to the provisions of this section [local authorities] may accept, hold and administer (a) for the purpose of discharging any of their functions, gifts of property, whether real or personal, made for that purpose or (b) for the benefit of the inhabitants of their area or some part of it, gifts made for that purpose and may execute any work (including works of maintenance or improvement) incidental or consequential on the exercise of powers conferred by that section . . . . Although gifts made in these ways constitute trusts, they are unlikely to be charitable. Both the Local Acts referred to before, Greater Manchester and Lancashire, with their 2I- and 35-year powers of veto over disposal to donors, suggest that, since they are not perpetual, they cannot be charitable. Case-law shows the difficulty of creating charitable trusts with the local authority as trustee. The judgement in Re Enducott (1960)8 decided that the nature of a local authority’s activities is not so clearly defined as being of a charitable character as to impose a charitable limitation on the words of a gift to that authority, as the statutory power of the council is not confined to charitable purposes. It is probable, therefore, that without the most specific terms of gift, donations to local authorities are not charitable and fall outside the scope of the Cottesloe opinion.
The Future The legal status of museum collections is not clear. The years since the Cottesloe opinion in 1964 have seen changes-particularly in terms of the nature of local authorities-which have cascaded to erode the foundations of trusteeship on which public museum collections have depended. Future trends will probably exacerbate the situation. The position of independent museums is no more satisfactory. Recent reports’ have recommended that the Charity Commission relax its regulation of charities, including those over disposal of property. Past controls, such as they were, will disappear to enable charity trustees to do what they believe to be best for their organizations. The likelihood of intervention by the Attorney-General in any case concerning museum disposals, given evidential and other requirements to prove charitable status, seems remote. The only positive note is the Museums & Galleries Commission’s Registration Scheme which, although voluntary, does provide a potential financial sanction (withdrawal of eligibility for its and Area Museum Council grant schemes) for those which transgress its disposals code. Taken with public opinion, these could be powerful deterrents to unsound disposals. Recent events-notably the sale of museum collections by
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Derbyshire County Council-have shown, however, that in certain circumstances these deterrents can be ineffective. Full legislative control over disposals from museum collections is unlikely to be However, there needs to be some formal-and promoted by the government. binding-reaffirmation of the Cottesloe opinion if public confidence in the custodial role of museums is to be sustained. The Museums & Galleries Commission’s recently published report on local authorities and museumslo suggests that a government circular issued jointly by the Department of the Environment and territorial departments might be useful. Without the sanction of the courts, however, any such directive could only be on disposals from a paper tiger, and in any case would have only limited influence museums subject to the oversight of the Charity Commission. Whether by legislation, creation of precedent by an action in the courts or by judicial review, the matter must be addressed and resolved if public confidence is to be sustained.
Notes 1. John Jacob,
‘The Sale of Museum Objects: The Principles Involved, and an Account of Some Cases in Point’, Museums Journal, 71, 1971/2, pp. 112-115. 2. The Charitable Uses Act (1601), as classified by Lord Macnaghten in Commissioners JOY Spectal Puvposes of Income Tax v. Pemsel [I8911 AC 531 HL, and other judgements. 3. British Museum Trustees v. White (1826) 2 Sim & St, 594. 4. Re Holbourne, Coates v. Mckillop (1885) 53 LT 212; Re Spence, Barclays Bank v. Stockton on Tees Corporation [1937] 3 All ER 684. 5. Westminster Bank Ltd v. Pinion [1964] 1 All ER 890 CA. 6. For example, in Butt/e v. Saunders [1950] 2 All ER 193. 7. Including the draft Deed in Adrian Babbidge, Charitable Status for Museums, AIM Guideline 3 (revised edition 1989). 8. Corpe v. Endacott [1959] 3 All ER 562. 9. Home Office Efficiency Scrutiny of the Supervision of Charities (1987); Home Office Charities: A Framework for the Future (1989). 10. Museums & Galleries Commission,
Local Authorities
& Museums
(1991).