Mar 2023 Charity & NFP Law Update
On February 24, 2023, the court in Friends of Nellie Lunn et al. v. Township of Wollaston held that land gifted to a municipality by way of a will did not create a charitable trust.
In 1981, Boleslaw Kilncewicz executed a will (“Will”) which left a parcel of land to the Corporation of the Township of Wollaston (“Township”), intending for it to be used as a park. The Will stated:
“I GIVE, DEVISE, BEQUEATH AND APPOINT all my estate, both real and personal, of every nature and kind whatsoever and wheresoever situate, and over which I have any power of appointment, to my Trustee, hereinafter named, upon the following trusts
1. To transfer and convey all my real estate located in the Township of Wollaston, in the County of Hastings, to the Town of Coehill for the purpose of a Park, and I direct that such Park shall be called the “Nellie Lunn Park”.
Decades later, the Township decided that it no longer wanted the land, and passed a resolution in 2022 to sell the property. A sale was to close in October 2022, but closing was delayed pending resolution of this case.
The applicants were an Ontario corporation named the Friends of Nellie Lunn Park and a private individual. They claimed that the Will established a charitable trust over the land in question and thereby the sale of the land was a breach of trust. The respondent Township argued that the Will did not create a trust and the Township has fee simple ownership of the land, which allows the Township the right to sell the land.
The court held that the property was not held in trust. For a will to create a trust, much stronger language is required and the language in the Will at hand was not sufficient to meet this threshold. The court found that there was no evidence of the circumstances leading up to the execution of the Will, nor was there any evidence that supported a finding that the Township accepted the land with the understanding it would be required to hold and maintain the land as a public park into perpetuity. As such, there was no “certainty of intention” to create a trust, which is one of the mandatory requirements for a trust to be created.
Although the court found that the sale was otherwise void because the sale was not properly authorized by by-law of the Township, this could be easily remedied by the Township passing the necessary by-law to approve the sale.
This case serves as a reminder that those wishing to make an estate gift subject to a charitable purpose trust should ensure that this is expressed in clear and direct language in the will, communicate the intention to create a trust to the intended bequest recipient, and that the recipient will agree to hold the property in trust.