The case presents the Seafarer’s Trust charity which through a will was given £2.5 million by Akira Kurosawa to use in its charity work in benefiting the unemployed sailors. The company was also entrusted with £2.5 million to build a multi-purpose recreational green space in the Liverpool city. The charity objective was to support the unemployed sailors together with those who were going through financial hardships. Two issues are arising from the case. First, the company had been wood up before when without Akira’s knowledge by the time it was given the money. Second, robots replace sailors meaning that the trust is no longer needed. However, the company completed the multi-purpose recreational green space in 2017 using £2 million.

From the analysis of the case, one of the issues to address is the responsibility towards remaining £0.5 million after building the space. Another aspect is the responsibility towards the £2.5 million which should benefit the sailors now that the marine service does not need them anymore. Also, there is the accountability combined issue of the £0.5 million and £2.5 million now that the company does not exist and it was unincorporated. These studies will focus on what the law of equity and trust says about such circumstances to advise the proprietors of the company on the available options.

Direction after Replacement of the sailors with robots

Seafarer’s Trust main objective was to support the unemployed sailors and the ones going through hardships. By replacing the sailors with robots, it means that the company can no longer achieve its objective because there are no sailors to support. The sailors were automatically entitled to charity by the virtual of the company objective and contributions like that of Akira(Cross)(Gravells ). However, the company had received £2.5 million from Akira, a settlor in the issue to support in its objective of helping the sailors. The proprietors of the charity organization might be tempted to keep the money for themselves with a defense that their purpose does not exist anymore with the implementation or robots. However, the doctrine of equity protects unnecessary benefits prescribed under the common law which individuals obtain in such a case.

The situation can be illustrated better by the Latimer v The Commissioner for Inland Revenue case. In the case, the judge held that the claimant could not be rendered as a beneficially because the there were no agreement or intention to use the contribution for charity or as trust. It means that as long as a trust allocates assets or funds for charity, they must be used for that purpose regardless of other occurrences. The charity company must avoid using circumstances to benefit from the funds allocated for other beneficiaries(Latimer).

Equity doctrine strengthens the common law by restricting the application of legal rights in some cases(Watt, pp. 14). The case where equity restricts the exercise of legal rights is where the common law application would lead to unconscionable dependence (Penner, 2016, 227). Common law would allow Seafarer’s or the proprietors of the company to own the money and use it for their benefit because the purpose intended no longer exists. However, use of the money for personal advantage is unconscionable dependence in the case of the trust company because it is taking advantage of extinction of their objectives. Other trust companies can arise with goals which they are sure that they will end after a short time of operation to benefit from the funding. Equity doctrine protects from such acts. In the case at hand, therefore, the company cannot own the money with support from the common law because of equity supplements the shortcoming of the applicable law (Virgo, 2018, 4);(Martin, ‘The Construction)

The doctrine of Cy prés under equity and trust law is applicable in the case to guide on what an organization is supposed to do where it is unable to meet its objectives. The doctrine permits the amendment of the provisions of the trust to as near as possible to what was the intention of the settlor or testator([Luxton). The Seafarer’s Trust company cannot be able to meet its objectives because of the replacement of the sailors with robots meaning that there are no sailors to help. However, the intention of the settlor, Akira was to support sailors to maintain enough workforces in the marine, an objective which is hard to meet either. In this case, Cy prés can guide to amend the terms of the Seafarer’s to make the company support the intention of Akira.  The court has the powers to order the charity to or proprietors to appoint beneficiaries as intended by Akira in the case(Martin and Hanbury,2005, 198).

The option available to the Seafarer’s Trust form the above analysis of change in circumstance which held a charity organization is to allocate the charity for other intentions. However, the aims should be close to those of Akira. The company can, therefore, decide to support the robot project or another project within the marine that ensures smooth running and service to marine clients. By doing so, it will ensure that it is not taking advantage of the common law shortcoming and that it is allowing equity in the application of rights(watt pp 5).

The Cy-près schemes provide another option available on what to do with the contribution from Akira. The properties of a charity organization can be transferred to another charity through trust(Charities Act 2011, s 62(1)). Now that the Seafarer’s Trust cannot be able to continue with its charity work, it can transfer its resources meant for charity to the charity organization by the trust which can use the contributions to continue with charity as it was the intention of the donors.

Account for the remaining £0.5 million after building the space

The company was given £2.5 million as a trustee to construct a multi-purpose recreational green space. However, £0.5 million of the funds remained unused. According to the doctrine of trust, the £2.5 million was supposed to benefit the public through the construction of the recreational space and the organization to enact it immediately Akira dies. Whether the Settlor is alive or not, the funds were supposed to support the public all of it according to the law of equity and trust(Watt, 4). The case of Liverpool and Distinct Hospital for Diseases of the Heart v Att General illustrates the circumstance of Seafarer’s Trust where contribution by donors to hospital projects was declared by the court to be trusted on the donors, and it had to serve their intentions(Liverpool and Distinct). The case of Re Wright also illustrates the issue where a testator had allocated a residential estate to a tenant through a trust. After the testator died, the trust had failed to hand in the whole estate with the claim that the testator no longer existed and so, the agreement was not practicable (Re Wright). The court of appeal held the contract on beneficially should be actualized in full immediately the testator dies and not to wait (Re Wright).

In determining what to do with the remaining £0.5 million now that the project entitled for the funds is complete, the doctrine of Cy près is applicable. According to the charity act of 2011, a trust organization can change the intention of a charity when the original purpose is partially or wholly fulfilled (Charities Act 2011, s 67(2)). In the case at hand,   the company used £2 million in building the recreational space meaning that it fulfilled part of the intention. It, therefore, means that the other remaining amount should be directed to another purpose but still for charity and not benefit the owners of the company(Charities Act 2011, s 67(2).

Winding up of the company

The proprietors of the company received the funding and trust from the settlor illegally since they had dissolved it.  However, the law of equity and trust can be used to get a solution. According to the Cy près doctrine, where no trustee is remaining in a charity, the powers of the charity will extend to the association whether incorporated or unincorporated(Watt, 4). In the case of Re Faraker, a settlor had given out a gift through charity which later amalgamated with other charities(Re Faraker). However, the court held a decision that the first charity passes the trust to the formed charity after amalgamation. Also, in the cases of Re Vernon’s, Berry v IBS-STL (UK) Ltd, Re Slatter’s, Re Rymer, Re Harwood and  Re King,  the charity organizations in question merged although the court held that the successor charities  to continue with endowment of charity(Re Vernon’s, Berry v IBS-STL (UK) Ltd, Re Slatter’s, Re Rymer, Re Harwood, and  Re King). Another case similar to the one mentioned is that of Re Finger’s will Trusts where the charity ceased before the death of testatrix (Re Finger’s). The court of appeal held that the organization had to serve the beneficiaries of trust immediately. The case provides that there is no room for excuses to use the contribution for trust company benefit.

Winding up of the company does not mean that the contributions for charity or the trust allocation ceases to exist and benefit the unintended people. The law of trust and equity directs on such circumstances. It guides that the original charity organization to transfer such donations, contributions, and allocation to another charity to continue with the intention of the settlors or testators.  The owners of Seafarer’s Trust should, therefore, trust Akira’s contribution for charity to another charity organization which will use it to implement the original intention. However, since the trust cannot meet the original plan, the same law of Equity and Trust guides that the terms can be changed to as near as possible to the original purpose (Virgo, 2018, 4).

The intention of the money is what matters in the case.

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