Euphemia (“Mia”) Polykarpou, died on 2 March 2015, leaving an estate with a value of about $1.4 million. She had made a Will in March 2004, probate of which was granted to her executor in October 2015.
Mia left her entire estate to charitable causes; half went to scientific research into the causes and cures for Multiple Sclerosis with the other half specifically gifted to Oprah’s Angel Network, a charity founded and managed by Oprah Winfrey.
Oprah’s Angel Network (OAN) operated from 1998 to 2010. OAN promoted the education and advancement of women with projects including provision of education supplies, school construction, and disaster relief. In May 2010 the charity stopped accepting donations and was shut down.
When Mia created her Will in 2004, OAN was operating as a charity. However by the time of her death OAN had ceased operation for 5 years; therefore the gift failed, as no organisation existed that could accept the gift.
Where a specific gift within a Will fails, and there is no provision in the Will for dealing with the residue of the estate, that portion of the Will is treated as if it did not exist. Those assets would be distributed as if the deceased died “intestate”. Where this occurs the court can step in and establish a scheme by which a failed gift is distributed to an alternate charitable beneficiary that is as closely aligned to the deceased’s intentions as possible.
Cy-pres is a doctrine which is applied when the strict terms of a will cannot be carried out and is subject to certain conditions;
- the testator must exhibit in his will a general charitable intention.
- there must be impracticability in the fulfillment of the charitable intention of the testator.
- the condition of the gift that causes the impracticability must not be an essential term of the bequest.
If those conditions are present and satisfied, then subject to the size of the bequest, the Court may direct that the gift given for charitable purposes should be administered via a cy-pres scheme – which is as near as possible to the intention evinced by the testator in the will, but without the impractical or unacceptable aspect.
The Court first considered whether the failed gift to Oprah’s Angel Network was for a charitable purpose. As the gift was to a charitable institution, it was held to be prima facie for a charitable purpose. The Court then considered whether the Will had a general charitable intention which should be administered through a cy-pres scheme.
Taking into consideration that the entirety of the Estate was gifted to charity and that the failed gift was to a charitable institution, the Court ruled that the intent of the deceased in her Will was charitable in nature. The Court then ordered that a cy-pres scheme be established to distribute the gift to a similar charitable interest.
In this instance Mia should have revisited her Will during the intervening period. As we have suggested previously a Will is a planning document that should be revised at a minimum every 3-5 years. If Mia had revisited her Will her executor wouldn’t have had to ask the court to intervene to ensure that her testamentary wises were carried out.