Koh Lau Keow v AG

• Jurisdiction: Singapore
• Judgment Date: 19 August 2013
• Date: 19 August 2013
• Docket Number: Originating Summons No 1021 of 2012
• Court: High Court (Singapore)

Koh Lau Keow and others

Plaintiff

and

Attorney-General

Defendant

[2013] SGHC 155

Tay Yong Kwang J

Originating Summons No 1021 of 2012

High Court

Trusts—Purpose trusts—Charitable trusts—Applicant seeking to set aside charitable trust declared over property on ground that one of declared purposes of trust was non-charitable in nature—Whether avowed purpose of using property as home or sanctuary for Chinese women vegetarians of Buddhist faith was non-charitable purpose—Whether aforesaid purpose should be construed to be ancillary to other charitable purposes and/or to overall charitable intent of declaration of trust—Whether there was sufficient public benefit for trust to be considered charitable

The first plaintiff, Koh Lau Keow (‘Koh’), was 96 years old and had been a devout vegetarian Buddhist since childhood. She was very close to three elderly women, whom she addressed as aunts despite the fact that they were not related to her by blood or marriage (‘the Aunts’).

In 1948, Koh acquired land located at 10 Rangoon Lane (‘the Property’) (in the joint names of herself and the Aunts) to establish a temple and provide a home for the Aunts. Koh fully funded the acquisition of the land and the erection of a wooden building (subsequently also fully paying for the erection of a concrete building in 1957).

Koh was advised that she could ask for a property tax exemption on the basis that the Property was used as a temple for religious worship. Koh applied unsuccessfully in 1948 and 1949, and was advised that it was unlikely for exemption to be granted unless the property was actually vested in trustees. A third application in May 1960 proved to be successful; Koh was told by her then lawyers that it would be helpful to sign a document declaring that the Property was being and would continue to be used for religious purposes. To that end, a declaration of trust was executed in October 1960 (‘the Declaration’). The preamble to the Declaration stated that the settlors (ie,Koh and the Aunts) were ‘desirous of dedicating [the Property] to charity’. The Declaration further stipulated that the Property was to be used for ‘all or any’ of the following purposes, including ‘as and for a home or sanctuary for such Chinese women vegetarians of the Buddhist faith as may from time to time be chosen by the trustees of this deed’ (hereinafter ‘Purpose B’).

Turning to the present application, Koh averred that she had been contemplating discontinuing all temple activities for some years. Due to her limited mobility and an inability to find successors to the running of the temple, Koh sought to terminate the Declaration and make provisions for the testamentary disposition of the Property.

Held, dismissing the application:

(1) Non-charitable purpose trusts were void because such trusts violated the beneficiary principle. Charitable trusts were a well-recognised exception to the beneficiary principle: at [18] and [19] .

(2) For a purpose to be classified as ‘charitable’ in the legal sense, it had to fall under one of four categories: the relief of poverty, the advancement of education, the advancement of religion and other purposes beneficial to the community (‘the Pemsel categories’): at [20] .

(3) If, upon a true construction of the trust, the trustees had a power to apply funds to purposes which did not fall within the Pemsel categories, such a trust was not a valid charitable trust falling within the exception to the beneficiary principle and was thus void: at [21] .

(4) It was well settled that courts leant in favour of charity when construing trust deeds: at [22] .

(5)‘Home’ and ‘sanctuary’ sufficiently overlapped in meaning such that ‘or’ could be interpreted exegetically. ‘Home or sanctuary’ connoted a religious institution where the defined class of persons (of that religion) was looked after and finds refuge or sanctuary. The use of the Property as a ‘home or sanctuary’ would certainly be religious in nature: at [29] and [31] .

(6) Case law had ascribed a wide meaning to the advancement of religion. It might be true that it was not enough for an organisation to merely do something in the name of religion for that organisation to be advancing religion, but this was not the case here. Using the property as a home or sanctuary for Buddhist Chinese women vegetarians directly advanced Buddhism; such persons residing in the property would certainly have benefited from passive advancement and personal spiritual contemplation: at [32] , [34] and [36] .

(7) The reference to the Property being used ‘for all or any of the following purposes’ had to be read in light of the rest of the declaration of trust, in particular the preamble, where the settlors stated that they were ‘desirous of dedicating [the Property] to charity’. The settlors clearly had a dominant charitable intention. Thus, even if Purpose B read alone did not strictly constitute the advancement of religion, it was to be construed as ancillary to the overriding charitable intention to advance religion. It would constitute a breach of trust if the Property were to be used entirely as a private residence: at [37] and [38] .

(8) It was well-settled that a trust had to benefit the public for it to be recognised as being charitable in nature: at [39] .

(9) There was a crucial distinction between a form of relief extended to the whole community yet by its very nature advantageous to only a few and a form of relief accorded to a select few out of a larger number equally willing and able to take advantage of it. Using the Property as a temple to provide a home or sanctuary for the class of persons defined was capable of conferring public benefit even though the class was confined by religion, gender and race. Buddhism was one of the main religions in Singapore and Chinese women formed a significantly large class of the population. A trust for the advancement of religion was also presumed to be for the public benefit: at [41] , [44] and [45] .

Chapman, Re [1922] 2 Ch 479 (folld)

Chichester Diocesan Fund and Board of Finance (Inc) v Simpson [1944] AC 341 (folld)

Commissioners for Special Purposes of the Income Tax, The v John Frederick Pemsel [1891] AC 531 (folld)

Compton, Re [1945] Ch 123 (folld)

Davidson, Re [1909] 1 Ch 567 (folld)

Davis, Re [1923] 1 Ch 225 (folld)

Endacott, Re [1960] Ch 232 (folld)

Gilmour v Coats [1949] AC 426 (distd)

Hetherington, deceased, Re [1990] Ch 1 (folld)

IRC v Baddeley [1955] AC 572 (folld)

Keren Kayemeth Le Jisroel Ltd v CIR [1931] 2 KB 465 (folld)

Morice v The Bishop of Durham (1804) 9 Ves Jun 399; 32 ER 656 (folld)

Nai Seng Hiang v Trustees of the Presbyterian Church in Singapore [1988] 2 SLR (R) 106; [1988] SLR 717 (distd)

Neville Estates Ltd v Madden [1962] Ch 832 (refd)

Samuel Emily, deceased, Re Will of [2001] 3 SLR (R) 335; [2001] 4 SLR 379 (folld)

United Grand Lodge of Ancient Free and Accepted Masons of England v Holborn Borough Council [1957] 1 WLR 1080 (folld)

Weir v Crum-Brown [1908] AC 162 (folld)

Trustees Act (Cap 337, 1999 Rev Ed) s 64

Charitable Uses Act 1601 (c 4) (UK)

Leonard Manoj Kumar Hazra (Damodara Hazra LLP) and Tang Hang Wu (instructed) for the plaintiffs

Zheng Shao Kai and Fu Qi Jing (Attorney-General's Chambers) for the defendant.

Tay Yong Kwang J

Introduction

1 This action concerns a trust declared over 10 Rangoon Lane (previously known as 156 ERangoon Road) (‘the Property’). The plaintiffs took out these proceedings to set aside the trust on the ground that it is a non-charitable purpose trust and sought a declaration that the first plaintiff is the sole beneficial owner of the Property. I dismissed the action on the basis that the trust is a valid charitable purpose trust. The plaintiffs have appealed and I now give the reasons for my decision.

Background

2 The first plaintiff, Koh Lau Keow (‘Koh’), was born in China in 1917 and has been a devout vegetarian Buddhist since childhood. She came to Singapore in 1936 to work and to undertake religious activities. She was very close friends with three elderly women whom she addressed as aunts even though they were not related to her by blood or marriage (‘the Aunts’).

3 In 1948, Koh acquired the Property to establish a temple and to provide a home for the Aunts. Koh paid for the Property with an upfront cash payment of $1,900 and a loan of $1,600. Despite Koh paying for the Property, Koh and the Aunts were named as joint tenants of the Property. At that time, Koh was travelling frequently and she did not want the Aunts to be left without a home should anything untoward happen to her.

4 Subsequent to the purchase, Koh erected a simple single-storey wooden building which was divided into a worship hall in front and two rooms at the back. The worship hall was used as a temple (named the Chee Teck Kwang Im Temple, hereinafter ‘the Temple’). The two rooms were used as living quarters for Koh and the Aunts. In 1957, a concrete building was erected (with Koh paying for the entire costs of the building). The concrete building was similarly divided into two sections, with the front used as the Temple and the back (comprising a kitchen, two bedrooms and a living room) used as a private residence.

5 Soon after the purchase of the Property, Koh was advised that she could ask for property tax exemption on the basis that the Property was used as a temple for religious worship. Koh applied unsuccessfully for exemption twice, in April 1948 and July 1949. In a letter dated 22 July 1949 to Koh, the Municipal Assessor stated that:

...

1. 2. In April 1948, a similar request was received on your behalf from Messrs. Richard Chuan Hoe Lim & Co. In reply the Municipal Assessor required to know :-

   1. (a) Whether the property was vested under a Deed of Trust, and if so, the names of the Trustees in whom the management of the building is vested?

...

1. 3. No reply was received to this...