Distant relative seeks to claim £500m fund set up to pay off the National Debt
In 1928, an anonymous donor gave away £500,000 for the purpose of paying off the National Debt. The investment has never grown sufficiently to clear the National Debt and although it has increased 1000 times to £500m, it represents less than 0.03% of the National Debt today.
The Government had asked the Court to clarify what should happen with the fund given there is no realistic prospect of it achieving its aim. That raises interesting legal issues of charity law and purpose trusts. However, a Court judgment earlier this month revealed a further complication – the mysterious donor’s great-nephew has now claimed that the 1928 deed is invalid and that the fund should be distributed to the donor’s heirs.
This incredible story will provide useful detail on the validity of purpose trusts. Inadvertently, however, it may also reveal more about the mysterious benefactor who wished to remain anonymous.
Nick Palmer is a solicitor in the private client team at Barker Gotelee, solicitors in Ipswich.