Over the spring and summer of 2019 – 2020, Australia suffered a series of catastrophic bushfires. Millions of hectares of bushland and agricultural land were burned out. Thousands of homes and properties were destroyed. Countless animals were killed or injured.
Thirty-three people throughout Australia were killed including fourteen firefighters; twenty-five people were killed in New South Wales including six members of the NSW Rural Fire Service. Many others sustained physical and psychological injuries.
In New South Wales firefighting was organised under the command of the NSW Rural Fire Service, a body constituted under the Rural Fires Act 1997.
Celeste Barber responded to this unfolding crisis by launching a charitable crowdfunding appeal (“the appeal”) in early January 2020 entitled:
“Please help any way you can. This is terrifying.”
Celeste nominated, and PayPal published, the NSW Rural Fire Service & Brigades Donations Fund (“the RFS Fund”), as the proposed recipient of the appeal donations. The RFS Fund is an express charitable trust and a charity within the meaning of s5 of the Charities Act. It is a registered charitable trust with the Australian Charities and Not-for-profits Commission. The appeal raised $51 million. PayPal remitted this money to the RFS Fund.
A charitable trust is created when an initial sum of money is transferred to a trustee, who manages it and the income from this investment is then distributed to charitable organisations for the advancement of the “charitable purposes” specified in the trust instrument.
Courts now generally accept that charitable trusts fall into one of the following, for the:
• relief of poverty;
• advancement of religion
• advancement of education
• or other purposes beneficial to the community
A charitable trust is administered by the trustees, whose powers are conferred by the trust instrument, legislation and the Court. In NSW, the relevant legislation is the Trustee Act 1925 (”the Act”) and the Charitable Trusts Act 1993.
The RFS Fund
The trustees of the RFS Fund, (“the trustees”) constituted by a trust deed of 10 April 2012 (“the Deed”) sought the Court’s advice or direction under s 63 of the Act as to the proper interpretation of the RFS Trust Deed.
The Deed established the RFS Fund. Recital B of the Deed records that the RFS Fund
“will be established and operated solely for the purpose of supporting the volunteer-based fire and emergency services activities of the Brigades”.
Clause 1.1 defines “Brigades” as
“all brigades establish from time to time under the Rural Fires Act 1997 (NSW) as amended.”
Clauses 2.1 and 2.2, of the Deed, establish and name the RFS Trust. Clause 2.3 sets out the purposes of the RFS Fund. This clause is the central provision to be construed by the Court.
The Court proceedings
Section 63 of the Act empowers the Court to advise trustees
“on any question respecting the management or administration of the trust property or respecting the interpretation of the trust instrument”.
The trustees wish to honour the intentions and beliefs of Celeste and the donors who responded to the appeal concerning what should be done with the donated money. But they wish to do so consistently with the Deed and following applicable law.
If a trustee acts on the Court’s “opinion, advice or direction’ under s 63 of the Act the trustee is
“deemed to have discharged the trustee’s duty as trustee in the subject matter of the application”.
Therefore, provided a trustee’s application is not misleading and the trustee acts following the Court’s advice, the trustee is protected from a complaint.
The advice the Court gives is private advice to the trustee. But unless there is a special reason for confidentiality, in the proper administration of justice, the advice is given in open court. In proceedings under s63 of the Act, a trustee asks the Court questions, which the Court then answers.
The trustees raise four questions with the Court about the interpretation of the RFS Trust Deed. whether, they are justified, in the proper performance of their powers and duties as the trustees, in applying the monies in the RFS Fund to any of the following four possible objects:
1. paying money to other charities or rural fire services, whether in New South Wales or other Australian states or territories, to assist in providing relief to persons and animals affected by bushfires;
2. setting up or contributing to a fund to support rural firefighters injured while firefighting, or the families of rural firefighters killed while firefighting;
a) physical health training and resources,
b) mental health training and resources, or
c) trauma counselling services,
d) to volunteer firefighters (as defined in Rural Fires Act, s 8), who require them in connection with performing the functions of the New South Wales Rural Fire Service, as defined by Rural Fires Act, s 9; or
4. setting up or contributing to a fund to meet the costs for volunteer rural firefighters, as defined in Rural Fires Act, s 8, to attend and complete courses that improve skills related to the volunteer-based fire and emergency services activities of the brigades, established under the Rural Fires Act.
The Crown, as parens patriae, must protect all property committed to charitable purposes. The Attorney General of New South Wales joined as a defendant in these proceedings on behalf of the Crown, fulfilling its usual role to represent the object of a charity.
The Court after taking account of the facts presented including greater detail about the appeal and the structure of the crowdfunding payment mechanism used; followed by the terms of the RFS Trust Deed and the legislative context relevant to the Court’s consideration of the terms of the RFS Trust Deed. The Court advises trustees of the RFS Fund that they:
1. Cannot use the donated money to give to other charities, or to donate interstate, or to help people or animals affected by bushfires.
2. Can set up or contribute to a fund to support rural firefighters injured while firefighting or the families of rural firefighters killed while firefighting.
3. Can make payments from the RFS Fund to provide volunteer firefighters with a fund from which physical and mental health training can be provided, together with trauma counselling services.
4. Can set up or contribute to a fund to meet the costs for volunteer rural firefighters to attend and complete courses that improve their skills related to the volunteer-based fire and emergency services activities of the brigades.
Despite the trustees’ wish to honour those donors’ intentions, hopes or both that the money they donated would be used for purposes beyond those which the Court has advised, the Court has applied the principles provided by the Act that ensure a degree of certainty in the application of trusts including charitable trusts.