Analysis
In November 2007 the claimant stood for election as chairman of the Korean Residents Society (the ‘society’). He was unsuccessful and, the result of the election being disputed, commenced proceedings in the Queen’s Bench Division against the first and second named defendants acting on behalf of the society. The trial took place on 12 March 2008 at the conclusion of which Judge Mackie QC declared that the election had been conducted by the Election Committee in breach of the duties owed to the claimant, gave directions as to the conduct of a further election and ordered the first and second named defendants to pay the claimant’s costs. They in turn issued third party proceedings against the current chairman of the society seeking an indemnity against the costs they have been ordered to pay and a default judgment was given on 23 March 2011. In subsequent proceedings before Master Leslie it was submitted that the original proceedings were likely to be charity proceedings within s33 of the Charities Act 1993 pursuant to which such proceedings required to be authorised by an order of the Charity Commission and, in those circumstances, on 4 November 2011 he ordered that the proceedings and execution be stayed and transferred to the Chancery Division for hearing by a Master. On 7 March 2012 Deputy Master Henderson directed that the claim, together with its enforcement be stayed until, inter alia, the claimant had obtained authority under s33 of the 1993 Act. The Charity Commission observed that it did not have power under s115 of the Charities Act 2011 (following the repeal of the Charities Act 1993) to authorise the substantive proceedings retrospectively and that it was unclear whether the enforcement proceedings fell to be authorised thereunder as they amounted to proceedings brought in a pending cause or matter. In view of that uncertainty the Charity Commission concluded that it could authorise the enforcement proceedings if and insofar as the same met the definition of charity proceedings pursuant to s115(8) of the 2011 Act and by order dated 12 February 2013 authorised the claimant, being a person interested in the charity, to take or continue to take the enforcement proceedings. The claimant duly applied to the court for an order that the stay imposed by Deputy Master Henderson be lifted on the ground that he had obtained authority from the Charity Commission and Master Marsh ordered that the stay be lifted on 4 July 2013. The first and second named defendants then sought permission to appeal against that order.
Held (refusing permission to appeal):
Section 115 of the Charities Act 2011 ultimately derived from s17 of the Charitable Trusts Act 1853 and provided that no charity proceedings should be entertained or proceeded with unless the taking of the proceedings was authorised by an order of the Charity Commission. It was clear that the Charity Commission, in distinguishing between the substantive proceedings and the enforcement proceedings, did not intend to authorise the former from their inception but only the remaining part of the existing proceedings, namely the enforcement of costs order. Authority demonstrated what could be described as a practice that the courts did not treat proceedings begun without leave as nullities but overcame the logical difficulty inherent in giving leave to commence after proceedings had already begun without that leave by giving instead leave to continue and taking that leave sufficiently to sanction the further conduct of the proceedings in question. Comparable statutory provisions could be taken to be directory and elsewhere authority treated a want of leave as only an irregularity. This demonstrated that the practice of granting retrospective leave for proceedings was well established in the cases. Accordingly, the Charity Commission had proceeded on a false premise when it supposed that retrospective authorisation of the proceedings could not be given. Section 115(4) provided that an order for the taking of proceedings in a pending cause or matter, or for the bringing of any appeal, was not required and this lent colour to the meaning of ‘the taking of proceedings’. It could not merely mean the ‘initiating or commencing of proceedings’ because, once a matter was pending, one would not speak of initiating proceedings within it but rather of taking steps in it, such as making applications. In other words, the taking of proceedings was something possible in the course of an action which had already commenced. Accordingly, the Charity Commission could authorise the taking of steps within existing proceedings, even though such proceedings as a whole have not been authorised from their inception, and are not so authorised. It thus followed that the Charity Commission had authorised the taking of proceedings, albeit within the existing proceedings, and it would be wrong to stay the operation of the orders.
Judgment MR JEREMY COUSINS QC: INTRODUCTION [1]This is an appeal against the order of Master Marsh made on the 4 July 2013, whereby he directed that the stay ordered by Deputy Master Henderson on the 7 March 2012 be lifted on the basis that the Claimant, Mr Park, had obtained authority from the Charity Commission …Continue reading "Park v Cho & ors [2014] EWHC 55 (Ch)"