Charitable Trusts

Question 1

Beneficiary of a Charitable Trust

Answer 1

(1) A charitable trust provides a social benefit to the public or a reasonably large class. There need not be a definite beneficiary, and the trustee does not ordinarily maintain a fiduciary relationship with any specific person.

Question 2

Gift to Charitable Corporation

Answer 2

(2) If a gift is made to a charitable corporation (or to a charitable state entity—SC Dept of Mental Health v. McMaster), even though the gift does not constitute a trust the

Question 3

RAP Period for Charitable Trust

Answer 3

(3) Because the RAP is inapplicable to a charitable trust, a charitable trust may be created for a period of time longer than the RAP period.

Question 4

Who May Enforce a Charitable Trust

Answer 4

(4) A co-trustee can enforce the trust against another co trustee, or the trust may be enforced by the AG.

Question 5

Filing a Charitable Trust

Answer 5

(5) The trustee of a charitable trust must file a certified copy of the trust instrument with the AG within 60 days after its creation.

Question 6

Charitable Purposes

Answer 6

(1) Charitable purposes may include

a. educational
b. religious
c. government purposes
d. relief of poverty
e. promotion of health
f. purposes beneficial to the community

(2) If a trust has purposes so vague or indefinite that they cannot be carried out or that do not qualify as charitable or benevolent, the trust will fail.
(3) A charitable trust will not fail by reason of the fact that
a. it may charge fees in its operation, provided such fees are not conducted for profit;
b. it has no geographical limitations; OR
c. it may benefit the rich as well as the poor (unless the purpose is relief of poverty).

Question 7

Failure or Need to Modify a Charitable Trust

Answer 7

(1) In SC, if a gift is made to an illegal charity, the gift fails.
(2) The doctrine of cy pres, permitting a court to modify a charitable trust when a trust purpose becomes illegal or impossible to perform, does not exist in name in South Carolina.
(3) SC has long recognized an analogous doctrine: equitable deviation, allowing for modification of the administrative provisions of a trust in a manner similar to cy pres, when reasonably necessary.

Question 8

Conditions of and Limitation Upon Charitable Gifts

Answer 8

Gifts to charities may be subject to various limitations and conditions that may terminate a gift after or upon the occurrence of certain events. Such limitations are effective unless illegal. Such a termination results in either a reverter (if provided for) or a gift over (to another charity).