Leahy v Attorney-General for New South Wales [1959] AC 457

Testator died, in his will he left his property to nuns ‘upon trust for such order of nuns of the Catholic Church or the Christian Brothers as my executors and trustees shall select …’ [clause 3] He gave his residuary estate to be put on trust, and the money resulting from the sale to build a new convent or add to existing ones [clause 5] Section 37D of the Conveyancing Act 1919-1954 of New South Wales (NSW): “No trust shall be held invalid by reason that some non-charitable and invalid purpose as well as some charitable purpose is or could be deemed to be included in any of the purposes to or for which an application of the trust funds or any part thereof is by such trust directed or allowed.” Trustees sought declaration as to whether the gifts from clauses 3 and 5 were valid

Did the gifts operate for individual members or institutional purposes, and could the applicable New South Wales legislation preserve a disposition containing charitable and non-charitable objects?

The Privy Council treated the gift as intended for the selected religious order as a continuing institution and for its work, rather than as an immediately divisible beneficial gift to its individual existing members. That construction raised ordinary difficulties about non-charitable purposes and perpetuity. The gift was nevertheless saved by the particular New South Wales statutory provision, which enabled charitable application despite the inclusion of possible non-charitable objects. The statutory saving is essential to the outcome. The decision should not be presented as establishing that every gift to a religious order is charitable, that all purpose gifts are valid, or that the same local provision applies to an English will.

A gift to an unincorporated religious order must be construed to identify whether it benefits members personally or supports the institution’s continuing purposes. Leahy’s validity outcome depended on a New South Wales statutory saving provision and cannot be transferred unqualified to English purpose-trust law.

Leahy concerns construction of gifts to associations and the distinction between gifts to private beneficiaries and gifts for institutional purposes. Its New South Wales statutory setting is important to the outcome. Later English cases develop additional contractual analyses of association gifts, so the possible routes cannot be reduced to two universal categories. The recipient class, the purpose and any applicable saving provision must each be identified before deciding whether the particular disposition can take effect.