Disposing Of Charity Land – Additional Considerations

Disposing of charity land carries a number of additional requirements and considerations. Such requirements will differ depending on factors, including:

  • What the land is held for;
  • What type of charity you are; and
  • How you intend to dispose of the land.

Before a charitable disposition is agreed, it is crucial to ensure that the correct procedure is followed. The correct procedure will depend on a number of circumstances:

1. Legislation

Part 7 of the Charities Act 2011 (CA) governs the disposition of land held on charitable trust.

2. What purpose is the land held for and by whom?

It is the purpose of land held which determines its charitable status. Often, the answer is ‘simple’ as the land is held by a registered charity.

However, sometimes land is held by other entities including companies, local authorities, a body of trustees, or an unincorporated association. Such entities may not even be aware that they are holding land on the terms of a charitable trust.

It is important to be sure and make proper investigations as dispositions of charity land which do not comply with the regulations are likely to be void.

3. Different types of charity

There are different regulations for different types of charity:

  • Exempt charities – exempt charities are listed in Schedule 3 of the CA and include:
    • Academies, foundation and voluntary schools, sixth form colleges and most universities;
    • Museums and galleries; and
    • Various charitable societies including housing associations.
  • Non-exempt charities – unfortunately this is not defined in the CA but the term is widely used in land to differentiate between charities which are not classed as ‘exempt’ or ‘other’ charities.
  • Other charities – include small groups which are connected with the Church of England, including ecclesiastical corporations, trusts of consecrated land and glebe land.

4. What is a ‘disposition’?

S117-123 CA 2011 regulates dispositions of charity land. ‘Disposals’ include:

  • A conveyance or transfer;
  • The grant of a lease for more than seven years;
  • Leases of whatever term granted at a premium;
  • The surrender of a lease;
  • The grant of an easement; or
  • Any contract which precedes any of the above

The charity must be able to demonstrate that the disposal is in the best interest of the charity and is negotiated on the best possible terms.

disposing charity land

How Nelsons can help

Amy Rowson-Hallam is an Associate in our expert Commercial Property team.

Should a charity be considering such a ‘disposal’, please get in touch so that we can guide you through the process. Please contact Amy or another member of the team in Derby, Leicester or Nottingham on 0800 024 1976 or via our online form.