Decision

Charity Inquiry: Wimbledon and Putney Commons Conservators

Published 2 July 2020

This decision was withdrawn on 13 July 2022

This Inquiry has been archived as it is over 2 years old.

The charity

Wimbledon and Putney Commons Conservators (‘the charity’) was registered on 14 April 1972. It is governed by an Act of Parliament, the Wimbledon and Putney Commons Act 1871. The charity’s objects are to preserve the land under its jurisdiction as open spaces for the purposes of exercise and recreation. The majority of the charity’s funding comes from a levy on local residents.

The charity’s entry can be found on the register of charities.

Background

This report, where appropriate, refers to three groups of trustees in relation to the charity ^{[footnote 1]}. The membership and composition of these groups varied from time to time, with some overlap in personnel. The ‘original trustees’ means those trustees who were in place up until the granting of the easement referred to in the report, in August 2014. The ‘subsequent trustees’ means those trustees who were in place after the granting of the easement, including when the Commission’s regulatory compliance case and the subsequent statutory inquiry was opened, up until the trustee elections held in 2018. The ‘current trustees’ means those trustees who have been in place since the trustee elections were held in 2018. The Commission has not sought or been able to apportion individual responsibility for any decision, act or omission by any individual(s) within the various groups of trustees.

The Putney Hospital site (‘the hospital site’) sits within the south-east corner of that part of Putney Lower Common bordered by Lower Richmond Road and Commondale. Before Putney Hospital closed in 1999 access to the hospital site was over common land and under licence.

In 2002 Wandsworth Primary Care Trust (‘WPCT’), who at that time owned the hospital site, approached the charity seeking to agree a right of way to the hospital site, in order to develop a primary care centre and private flats. This led to the granting of the ‘2010 transfer’ on 8 July 2010, providing for a transfer of land to the original trustees and a grant by the original trustees to WPCT of rights on terms to enable the hospital site to be developed. The rights were to be granted for a consideration of £250,000, payable not later than 56 days before development began. £1 of the £250,000 was for rights relating to the primary care centre and £249,999 relating to the private flats. The development did not proceed.

On 14 February 2012 WPCT sold the hospital site to Wandsworth Borough Council (WBC) for £4,400,000. On the same day the original trustees entered into an agreement with WBC (‘the 2012 agreement’) relating to the granting of an easement (‘the easement’) over part of the Commons to WBC. The 2012 agreement provided that, following planning permission being obtained to develop the hospital site into a primary school and residential flats, WBC and the original trustees would enter into a Deed of Easement in the form annexed to the 2012 agreement. The easement’s purpose was to grant access rights over Putney Lower Common to the hospital site. The 2012 agreement provided for £350,000 to be paid to the original trustees in return for the grant of access rights, £1 for rights relating to the school and £349,999 to the flats.

Following an unsuccessful judicial review of the legality of the 2012 agreement, the easement was formally granted on 13 August 2014 (‘the 2014 agreement’), with £350,000 being paid to the charity. The original trustees considered they were bound as at 14 February 2012 to enter into the 2014 agreement. The easement was granted on similar terms to those set out in the 2010 transfer save that the consideration was £350,000.

In May 2015, due to differing views amongst the subsequent trustees on the matter, the subsequent trustees agreed to instruct a legal firm to review the way in which the sum paid for the easement was determined and whether the process met charity law requirements. However, partly due to a dispute within the charity, the legal firm stopped providing services to the charity in August 2015.

On 9 July 2015 one or more members of the charity’s Audit and Risk Committee (ARC) commissioned a surveyor’s report for a revaluation of the easement. Some members of the ARC and the Board were not aware of the commissioning of the surveyor’s report. The report (‘the 2015 surveyor’s report’) was produced in September 2015. The 2015 surveyor’s report stated that the terms and price agreed for the easement were not the best reasonably obtainable and that granting the easement on the terms agreed was not in the charity’s best interests. It also stated that the payment should have been around £1,900,000, with the lowest acceptable payment being £1,187,500.

The 2015 surveyor’s report cost £21,250 excluding VAT. Most of the subsequent trustees did not accept the legitimacy of the 2015 surveyor’s report, believing that the ARC did not have the authority to commission it and that not all relevant facts and documents were disclosed to the surveyor. The ARC representatives who commissioned the 2015 surveyor’s report believed they were acting in the charity’s interests. The surveyor who produced the 2015 surveyor’s report said he would be prepared to ‘revisit’ his valuation, taking account of any facts not available to him at the time. The subsequent trustees did not take up the offer, although a minority of them were in favour of doing so.

Two of the subsequent trustees of the charity made a serious incident report to the Commission regarding the granting of the easement at an apparent undervalue. One of the two subsequent trustees subsequently resigned.

The Commission opened a regulatory compliance case into the charity on 21 September 2015 due to its concerns about a potential financial loss to the charity if the easement had been granted at an undervalue.

The Commission met with the subsequent trustees on 9 October 2015 and issued a letter on 22 October 2015 containing a formal action plan. The action plan listed six steps for the subsequent trustees to undertake, including appointing legal advisers and a valuer, obtaining a valuation and considering the feasibility of recovery of charitable funds if appropriate.

By August 2016 the subsequent trustees had accomplished only the first of the action plan’s six steps, appointing a legal advisor in February 2016. The Commission had serious concerns about this slow pace. The Commission was also concerned that the subsequent trustees might be unable to progress the rest of the action plan due to a serious dispute within the trustee body and the possibility that some subsequent trustees might be conflicted in any decision making. The Commission was further concerned that the original trustees who agreed to enter into the easement might not have acted in the best interests of the charity, or with reasonable care and skill, indicating a potential breach of trustee duty which might have exposed the charity to a significant financial loss. There was also a continuing risk to charitable property due to the ongoing expenditure by the subsequent trustees on professional fees due to the trustee dispute. There was a risk to public trust and confidence in the charity and charities more generally due to issues surrounding the granting of the easement, the trustee dispute and the dispute being played out on a local community website.

Due to these concerns, on 18 August 2016 the Commission opened a statutory inquiry under section 46 of the Charities Act 2011 (‘the Act’).

The inquiry closed with the publication of this report.

Issues under Investigation

The scope of the inquiry included: - the administration, governance and management of the charity by the trustees with specific regard to the granting of the easement in August 2014 to the London Borough of Wandsworth for access rights over Putney Lower Common and governance costs generally - whether or not the trustees had complied with and fulfilled their duties and responsibilities as trustees under charity law - the extent to which the trustees were unwilling or unable to comply with the action plan issued by the Commission on 22 October 2015 - whether the easement was granted at a significant undervalue and, if so, whether sufficient consideration was given as to whether it was appropriate or feasible to recover any monetary loss to the charity and from whom - whether conflicts of interest were managed appropriately

Appointment of Interim Manager

The inquiry appointed an Interim Manager to consider the decision of the subsequent trustees of the charity not to take legal action to recover any loss which may have been suffered by the charity following the granting of the easement in August 2014. This was a narrow appointment and the subsequent trustees remained in control of the management of the charity apart from this issue. The charity’s subsequent trustees were embroiled in a dispute regarding the granting of the easement which meant that they were unable to work together to progress the matter satisfactorily. Appointing an Interim Manager as an independent and neutral person was intended to provide assurance to the public, in particular the local residents who contribute towards the income of the charity via their levy payments, that any decision to take or not to take action to recover funds potentially lost by the charity had been made properly and that the charity’s assets had been protected. The Interim Manager’s report is attached to this report.

Findings

The administration, governance and management of the charity by the trustees with specific regard to the granting of the easement in August 2014 to the London Borough of Wandsworth for access rights over Putney Lower Common and governance costs generally

Prior to opening the inquiry the Commission received contradictory accounts and interpretations of events relating to the administration, governance and management of the charity, with specific regard to the granting of the easement, from the subsequent trustees.

The Commission was aware, from correspondence from levy-payers and postings on a public forum that issues surrounding the granting of the easement and the related dispute within the charity were known to local residents. Issues relating to the easement and the dispute within the charity’s subsequent trustee body remained unresolved after a considerable period of time which was damaging to the charity’s reputation, an asset which the Commission expects trustees to protect. The inquiry remained and continues to remain neutral regarding the dispute, focusing on the cause of the disagreement and the governance of the charity.

The disagreement amongst the subsequent trustees over whether members of the charity’s ARC had the authority to commission a retrospective valuation report relating to the easement intensified the subsequent trustee dispute. A lack of clarity meant that the subsequent trustees were able to interpret the position in two opposing ways. It is important for charities to ensure that the terms of reference, delegated powers and authority to spend the charity’s funds of committees are clear, so as to avoid this type of dispute. The 2015 surveyor’s report obtained by members of the ARC was not formally accepted by the majority of subsequent trustees who considered the instruction to have been unauthorised and that not all relevant facts and documents were disclosed to the surveyor. The main subsequent trustee board started the process of obtaining a further valuation, despite the fact that the surveyor commissioned by the ARC offered to revisit their 2015 surveyor’s report.

At the time that the Commission opened its inquiry there was severe dysfunctionality within the charity’s subsequent trustee board, which centred on the issue of the granting of the easement. There were subsequent trustees with different and strongly held opposing views who all considered they had the interests of the charity at heart and that trustees with an alternative view were acting against the best interests of the charity. This meant that the subsequent trustees appeared unable to work collectively to progress some issues, for example they failed to comply with the Commission’s action plan within a reasonable timeframe.

In 2008 the original trustees had instructed a surveyor to provide advice in connection with the proposed granting of the easement, but had not sought to obtain a full valuation report. An email from that surveyor in 2008 referred to an amount of £250,000 in relation to the proposed deed of easement. In October 2011 the surveyor was instructed to negotiate with WBC on the proposed disposal and at this time an amount of £350,000 is referred to.

After the opening of the inquiry the dysfunctionality of the subsequent trustee board continued. The inquiry received contradictory accounts of events from different subsequent trustees. For example, after the inquiry directed the subsequent trustees to obtain a revaluation of the easement, some subsequent trustees alleged that the majority of the subsequent trustee board were not ensuring that the appointment process for the surveyor was being conducted in an independent and impartial manner. Other subsequent trustees alleged that it was. These allegations and counter-allegations were a contributory factor in the inquiry’s decision to appoint an Interim Manager.

The inquiry found that the charity’s governing document, which dates back to 1871, contained provisions and powers that either required modernisation and/or were not fit for purpose. For example, financial amounts referred to had not been updated and aspects of more modern life are not considered. There was also scope for the governing document to provide more clarity on the conduct and behaviour of trustees. This will be taken forward by the current trustees, as part of a broader constitutional review, outside of the inquiry. The Commission will assist in this process where appropriate.

Since the charity’s latest trustee elections in 2018 the current trustee board has significantly improved its openness and accountability, for example by introducing a new and transparent complaints procedure and by publishing more information on the charity’s website. The current trustees are also taking significant steps to improve the governance of the charity.

Whether or not the trustees complied with and fulfilled their duties and responsibilities as trustees under charity law

On 9 April 2008 the Commission wrote to the original trustees explaining the Commission’s then interpretation of the law that a charity may only grant an easement if authorised to do so by an Order of Court or the Commission or if it complied with s36(3) of the 1993 Charities Act (as amended by the Charities Act 2006). ^{[footnote 2]} Compliance with the 1993 Charities Act would include:

• obtaining and considering a written report from a qualified surveyor
• advertising the disposition if advised to by the Surveyor
• deciding whether they were satisfied, having considered the Surveyor’s report, that the proposed terms were the best that could reasonably be achieved for the charity

The original trustees obtained legal and valuation advice on the proposed terms for the 2010 transfer in October 2008 and for the 2012 agreement in December 2011. However, they did not obtain a formal surveyor’s report. The Interim Manager found nothing to suggest that the advice would have been any different had a formal surveyor’s report been prepared.

In the 2012 agreement the original trustees certified that they had complied with the provisions of the Charities Act 1993 in relation to the granting of the easement. In the 2014 agreement the original trustees certified that they had complied with the provisions of the Charities Act 2011 in relation to the granting of the easement, as far as applicable.

In April 2016 the subsequent trustees obtained legal advice that the provisions of the Charities Act 2011 relating to the disposal of land did not apply to the charity, as they could rely on section 8 of their governing document for the power of disposal. The advice explained that the original trustees were not obliged to obtain a surveyor’s report before entering into the 2012 agreement. The advice also confirmed that the relevant valuation date was 14 February 2012, i.e. the date the 2012 agreement was entered into and the original trustees became bound to grant the 2014 easement.

On the basis of this advice, the subsequent trustees sought to obtain a retrospective valuation report as at 14 February 2012 to establish whether the consideration received by the original trustees for the grant of the 2014 easement represented the best terms that could reasonably be obtained.

The inquiry considers that the original trustees should have obtained a formal surveyor’s report prior to facilitating the granting of the easement. The subsequent trustees did obtain retrospective legal advice that there was no need to comply with the provisions of the Charities Act 2011 relating to the disposal of land. However, this was not established at the time of the transaction and in the Commission’s view, it would have been best practice to have obtained a formal surveyor’s report. Whilst the inquiry cannot conclude the failure to obtain a formal surveyor’s report has resulted in financial loss to the charity it would, at the least, have reduced the scope for disagreement amongst the trustees.

The Chair of the subsequent Trustees confirmed to the Commission in January 2017 that between April 2015 and January 2017 the charity incurred legal and professional fees of £263,633.61 excluding VAT. The Chair of the subsequent Trustees said that these fees related to obtaining two retrospective valuations, taking steps to comply with the Commission’s action plan and inquiry and taking advice in relation to disciplinary action against a subsequent trustee. In the inquiry’s view these costs arose in connection to the granting of the easement without following or clarifying the requirements of charity legislation and as a result of the subsequent trustee dispute which largely centred on this issue.

The subsequent trustee dispute meant that the subsequent trustees were unable to act collectively or in the charity’s best interests to resolve the issues relating to the granting of the easement. All the subsequent trustees believed that they were acting in the best interests of the charity, but the effect of the dispute was to take resources away from operating the charity effectively.

Since the opening of the inquiry the subsequent and current trustees have co- operated fully with the inquiry by complying with the inquiry’s Orders and Directions and requests for information. The current trustees are taking steps to improve the governance of the charity.

The extent to which the trustees were unwilling or unable to comply with the action plan issued by the Commission on 22 October 2015

The Commission issued a formal action plan to the subsequent trustees on 22 October 2015. The subsequent trustees were slow to comply with the action plan before the inquiry was opened. Following the opening of the inquiry the charity made further progress in complying with the action plan.

The subsequent trustees had only accomplished the first of the six requirements of the Commission’s action plan before the inquiry opened. This requirement was to appoint lawyers which the subsequent trustees achieved in February 2016. On 30 August 2016 the subsequent trustees resolved to commence a process to appoint an independent valuer to undertake a retrospective valuation as at 14 February 2012. The valuer was appointed in October 2016 and produced a report which concluded that the value of the easement as at the date of the 2012 agreement was £675,000. The non-conflicted subsequent trustees considered that revaluation report in November 2016 and resolved to seek further legal advice on whether it was appropriate and feasible to recover any losses and if so from where.

In December 2016 the non-conflicted subsequent trustees discussed next steps regarding the possible under-valuation and resolved to obtain further legal advice. This advice was obtained in February 2017 and discussed in that month. The non-conflicted subsequent trustees agreed at that meeting that they did not think that it was in the best interests of the charity to incur any further costs on the matter of the valuation.

There were serious divisions within the subsequent trustee body to the extent that the Commission received separate and contradictory interpretations of events from both individual subsequent trustees and different groupings of subsequent trustees, including on the reasons for the subsequent trustees’ failure to comply fully with the Commission’s action plan in a timely manner. In the inquiry’s view the divisions centred around the granting of the easement. The divisions created mistrust and entrenched positions amongst the subsequent trustees. The subsequent trustee body was split and apparently unable and/or unwilling to work together to implement the Commission’s action plan. A considerable amount of time and resource was spent by the subsequent trustees on the dispute within the subsequent trustee body, meaning that the subsequent trustees were slow to comply with the Commission’s action plan.

The Interim Manager also found that difficulties and disagreements within the subsequent trustee board meant that the matters relating to the revaluation took much longer to progress than he would have expected.

Whether the easement was granted at a significant undervalue and, if so, whether sufficient consideration was given as to whether it was appropriate or feasible to recover any monetary loss to the charity and from whom

The 2010 transfer allowed for the transfer of land and granting of an easement for £250,000. Within this agreement additional land was to be transferred to the original trustees and works were to be undertaken to the Commons. It appears that the value of the land to be transferred to the original trustees was estimated at £12,500 and the costs of the works were estimated to be £250,000-£300,000. In December 2011 the London Borough of Wandsworth (‘LBW’) increased its offer to £350,000 in addition to the land transferred to the original trustees and the work to be carried out on the Common, by now apparently estimated to be worth £310,000. The inquiry notes, however, that the 2015 surveyor’s report stated that works which LBW agreed to undertake to the Common in relation to the easement were analogous to development costs that would have been incurred by LBW in any event; any benefit to the charity was ancillary. The 2015 surveyor’s report did not place any value to the charity on those works.

The inquiry directed the subsequent trustees to appoint a surveyor to carry out a retrospective valuation of the easement.

The surveyor who produced the 2015 report had previously offered to revisit their report afresh in the light of additional documents, including documents relating to the 2010 transfer. This offer was not taken up. The majority of the subsequent trustees expressed concerns that they did not have any information as to the detail of instruction given to that surveyor previously and preferred to proceed with the appointment of a different valuer.

In October 2016 concerns were raised with the Commission by some of the subsequent trustees regarding the Board’s selection process for selecting the new surveyor to perform a revaluation and also regarding the instructions sent to that surveyor.

In November 2016 the new surveyor’s report was received by the subsequent trustees (‘the 2016 report’), which concluded that the value of the easement as at the date of the 2012 agreement was £675,000, identifying a potential loss to the charity of £325,000. However, the 2016 report also found that had the 2010 transfer not been entered into the appropriate value would have been £1,350,000 ^{[footnote 3]}.

Following receipt of the valuation the subsequent trustees took advice about what action they could take to recover the money the charity may have lost as a result of the possibility that the disposal had been at an undervalue. After receiving and considering that advice, the non-conflicted subsequent trustees, who had not been involved in the decision making regarding the easement, decided to take no further action to recover funds on the basis that they considered that it would not be in the charity’s interests to incur further costs in attempting to do so. Information supplied to the Commission by some of the subsequent trustees indicated that those advising the charity may not have had all the necessary information given to them to enable them to provide the comprehensive advice required for a properly informed decision, and it therefore appeared possible that the subsequent trustees did not consider all the relevant facts. The inquiry appointed an Interim Manager to obtain further clarification on these issues.

The Interim Manager found that all relevant information necessary to allow them to discharge the responsibilities for which they had been instructed was supplied by the subsequent trustees to their legal advisers. This information had then been used by the legal advisers when they instructed the surveyor to provide the 2016 report and when they instructed further legal advisors to provide an opinion on whether any legal action by the subsequent trustees was appropriate and proportionate. The Interim Manager found that a meeting on 8 February 2017 where the majority of subsequent trustees who were non-conflicted decided to take no further action to recover funds was validly convened and quorate. The Interim Manager found that the decision was taken after a full discussion and the consideration of legal advice and that the non-conflicted trustees acted reasonably in resolving by a majority to follow the advice of their solicitors. The Interim Manager’s own conclusion was that it did not appear to be proportionate or in the interests of the charity to initiate proceedings to recover any loss that may have been incurred by the charity.

Given the concerns expressed by some subsequent trustees, the Interim Manager also asked the surveyor who had produced the 2015 report to revisit his previous valuation principally in light of information relating to the 2010 transfer which was not supplied with their original instructions. That surveyor concluded in a further report (‘the 2018 report’) that the value of the easement was £830,000-£950,000. The range of valuations provided shows the difficulty in calculating the extent, if any, of the loss to the charity. The Commission accepts that valuation is not a precise science and it is possible for two professional valuers acting properly and in good faith to arrive at different valuations. Whilst the easement was granted for £350,000, the range of valuations now obtained indicated a value of between £675,000 and £830,000 - £950,000. That said, the Commission also noted the determination of the Court of Appeal, dated 9 July 2014, that found the Conservators were entitled to take into account the overall impact of the proposal including the net effect on the Commons of the scheme as a whole ^{[footnote 4]}.

Whether conflicts of interest are being managed appropriately

Some of the original trustees who made the decision to grant the easement were still in place at the time that the inquiry opened, and when the issue of a possible undervalue and what to do about it was being dealt with. It is important to manage conflicts of interest, and to be able to demonstrate that they are being managed when a charity’s current board is investigating the actions of a previous board. In this instance some original trustees were conflicted with regard to considerations relating to the revaluation of the easement and the possibility of legal action to recover any losses sustained by the charity. The way in which conflicts of interest were identified and managed were acceptable to most but not all of the subsequent trustees.

The inquiry found that conflicts of interest had been identified and appropriately managed by the subsequent trustees in relation to the appointment of a valuer. The Interim Manager also concluded that conflicts of interest were managed appropriately by the subsequent trustees in taking the decision not to seek restitution, with the conflicted subsequent trustees being excluded from this decision making process. The subsequent trustees took legal advice on these matters, gave the advice due consideration, and excluded conflicted persons from decision making in an appropriate manner and based on the advice received.

Trustee Elections

The charity’s governing document requires five of the charity’s eight trustees to be elected by residents in a specified geographical area who pay a levy to the charity. The other three trustees are appointed by the Secretaries of State for the Home Office, Defence and Environment, Food and Rural Affairs respectively. The trustees are either elected or appointed for three years and are then eligible for re-election or re-appointment.

An election for the five elected trustee positions on the board of trustees took place whilst the inquiry was open, in February 2018. The Commission received several complaints regarding the trustee elections which it examined as part of the inquiry.

The inquiry found that the charity’s guidance on the conduct of trustee elections, including the conduct of candidates, was very limited and in need of modernisation. There were no clear written policies on issues such as funding candidates and expenditure by candidates. The lack of written guidelines for candidates meant that there was ambiguity, which increased the scope for complaints regarding the conduct of elections.

There were differing views amongst the subsequent trustees as to what constituted acceptable behaviour by trustees during election time. The inquiry recommended that the current trustees consider introducing a policy whereby statements made in a personal capacity by trustees in the period leading up to an election must explicitly state that they are being made in a personal capacity. The inquiry also recommended that the current trustees consider clarifying and approving a written policy as to when the consent of the board is required before posting statements and when it is not, with particular reference to elections.

The role of the Returning Officer during the election – a trustee - was made difficult by a lack of guidance on the role, trustee conduct and other matters. The Returning Officer monitored conduct as best they could on a common sense basis but their role would have been easier and their decisions less susceptible to challenge if there had been written, agreed and publicised guidance for trustees’ behaviour at election time. The inquiry was satisfied that the Returning Officer reacted to events in a reasonable way in the absence of clear guidance and policies and that the subsequent trustees followed a decision making process before releasing documents during the election period.

The inquiry provided regulatory advice and guidance to the current trustees on the trustee election process, and the current trustees are to make improvements to the election process and related guidance before the next trustee elections in 2021.

Conclusions

The Commission found that the original trustees failed to obtain a formal surveyor’s report or to obtain formal legal advice that this was not required in advance of the granting of the easement. They did, however, obtain some legal and valuation advice on the issue. Retrospective valuations have indicated that the easement may have been transferred at an undervalue.

The inability of the subsequent trustees to manage the trustee dispute resulting from the granting of the easement is evidence of mismanagement of the charity. The subsequent trustees were unable to progress the Commission’s action plan within a reasonable timeframe largely due to the impact of the subsequent trustee dispute. Without the opening of the statutory inquiry by the Commission and the inquiry’s subsequent appointment of an interim manager it is unclear whether the trustees would have been able to work together in the best interests of the charity to progress and resolve matters relating to the transfer of the easement. The previous lack of progress was costly to the charity in terms of diverting resources from the objects of the charity and was clearly not in the charity’s best interests. It is inevitable that there will be differences of opinion amongst trustees from time to time but all too often the Commission sees such disagreements deteriorate into entrenched disputes which damage the charity’s reputation and deplete its funds.

The decision by the subsequent trustees that it is not in the interests of the charity to seek to recover any funds which may have been lost to the charity was a reasonable decision and took into account legal advice received. Taking legal action to recover losses sustained by a charity is a costly and unpredictable course of action. This makes it all the more important for charity trustees to obtain formal advice in the first place, because rectifying situations further down the line is so difficult.

During the course of the inquiry the Commission provided regulatory advice and guidance to the charity. The administration, management and governance of the charity has now significantly improved, in particular since the trustee elections of 2018. In its recent meetings and correspondence with the inquiry the current trustees have demonstrated their ability to act collectively in the best interests of the charity.

Regulatory Action Taken

The inquiry issued an Order under section 84 of the Charities Act 2011 requiring the subsequent trustees to appoint a surveyor to carry out a retrospective valuation of the easement.

The inquiry obtained information from the subsequent trustees under section 47 of the Charities Act 2011 including instructions issued to legal advisors and valuers, legal advice received, and other information relating to the procurement and tender process by which the subsequent trustees selected and instructed the surveyors for the retrospective valuation of the easement.

On 31 May 2017 the inquiry appointed Gordon Reid of Barlow Robbins as Interim Manager to the charity, to work alongside the subsequent trustees, under section 76(3) (g) of the Charities Act 2011. The Interim Manager was appointed to consider the subsequent trustees’ decision on 8 February 2017 not to take legal action to recover the loss suffered by the charity following the granting of an easement to the London Borough of Wandsworth in August 2014 for access rights over Putney Lower Common for £350,000 which was at a potential undervalue (‘the decision’) and whether further action needed to be taken. In particular the Interim Manager was to:

a. review the information supplied to the subsequent trustees’ legal advisers and assess whether all relevant information was supplied and duly considered by the subsequent trustees

b. determine whether the decision was taken properly and was in the best interests of the charity

c. if required, to obtain further legal or valuation advice for a new decision to be properly made

d. make recommendations as to whether legal action to recover property was proportionate and in the interests of the charity

e. report to the Commission the reasons for affirming or re-taking the decision with supporting information

The inquiry discharged the Interim Manager on 28 August 2018 after his work was completed and his report was submitted to the inquiry. The cost of the Interim Manager appointment was £26,564.80 including VAT and disbursements. A revaluation arranged by the Interim Manager cost £4,900 plus VAT.

The inquiry provided regulatory advice and guidance to the current trustees, including on the importance of having clear written policies and procedures relating to elections, complaints procedures, and the requirement to be transparent and accountable.

Issues for the Wider Sector

Charity trustees have a duty to ensure that they comply with their legal duties, which includes always acting in the best interests of their charity and with reasonable care and skill. How they demonstrate this is usually left to their discretion, but when it comes to selling, leasing or transferring their charity’s land, it is important to ensure that these important transactions are properly managed in the charity’s interests and that the charity trustees obtain the best price reasonable in the circumstances.

For most disposals involving a sale, lease or other disposal of an interest in land, the law requires that charity trustees obtain and consider a written report from a qualified surveyor, advertise the disposal following advice from the surveyor, and decide whether they are satisfied that the proposed terms are the best that can reasonably be obtained in the circumstances of the disposal. The surveyor must be appropriately qualified and the charity trustees must follow his or her advice on how to market the disposal (or not, if that is the advice).

Every charity needs an effective trustee body which has control over the administration of the charity and acts as a whole, especially because all trustees are jointly and equally responsible for the management of their charity. A charity is entitled to the independent and objective judgment of each of its trustees, acting in the best interests of the charity.

The conduct of trustees can be a key driver of public trust and confidence in the charity sector. When the conduct of trustees falls below the standards expected there can be damage to the reputation of individual trustees, the charity and possibly the wider charity sector.

1. By section 8 of the Wimbledon and Putney Commons Act 1871 the Conservators were established “for carrying this Act into execution, the full number of whom shall be eight, and who are hereby incorporated by the name of the Wimbledon and Putney Commons Conservators, and by that name shall be one body corporate, with perpetual succession and a common seal, and with power to take and hold and to dispose of (by grant, demise, or otherwise) land and other property”. ↩

2. An identical provision is now included at s119 of the Charities Act 2011 ↩

3. Dated 11 November 2016. Retrospective Valuation as at 14th February 2012 to establish whether the consideration agreed for the Deed of Easement dated 13th August 2014 represented best value. ↩

4. [2014] EWCA Civ 940 ↩