In September the Charity Commission produced a case report following its investigation into the unincorporated charity Imamia Mission London (UK) and its decision to relocate to a new site.
The report raises interesting questions about how charity trustees should decide what is right for their charity and the importance of listening to the people who benefit from the charity's work.
Facts of the case
The Charity Commission's involvement centred around the charity's decision to relocate within London from a mosque in Newham to one in Ilford, some four miles away. The trustees had come to the conclusion that relocation was desirable due to the small size and health and safety problems of the charity's previous base.
The Charity Commission's report, somewhat unusually, is able to stress many of the things the charity did correctly in the process of relocation. In particular, it noted that the trustees of the charity had:
- properly followed its constitutional document
- avoided conflicts of interest; and
- made a decision within 'the range of decisions a trustee body could reasonably make'.
However, the Charity Commission found that the trustees' decision, while valid, was ultimately deficient as they had failed to take into account the views of the charity's members and beneficiaries in making it.
Lessons for Trustee Boards
This case report illustrates how Trustees can get into difficulty for making what they believe to be a reasonable decision without following a reasonable process to do so.
The issue the Commission identified was that the Trustees had decided that the charity should move without being 'sufficiently informed' or taking into account 'all relevant factors'.
In a decision like this the voices of key stakeholders - in this case users of the charity's premises – must be taken into account. By ignoring them the Trustees failed in their duties to manage the charity so as to avoid unnecessary litigation and reputational risk.
