Also known as: benevolent trusts · charitable trust
Written by attorneys · grounded in primary & secondary sources — see below
A trust or portion of a trust created for a charitable purpose. Charitable purposes include the relief of poverty, the advancement of education or religion, the promotion of health, governmental or municipal purposes, or other purposes beneficial to the community.
Marie transferred farmland and cash to Dakota as trustee with directions to provide low-interest loans to local family farms and lifelong care for working animals. Horizon Livestock objected that the distributions conferred private benefits. The court determined the trust qualified as a benevolent trust because its purposes advanced community-wide agricultural traditions and rural economies.
A retired shop owner transferred funds to Stone Trade to subsidize retail leases for artisans on Main Street. After online commerce emptied the corridor, South Commerce petitioned to redirect funds to digital platforms. The court evaluated whether the original purpose remained feasible under the benevolent trust framework.
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Senator Bacon devised land for a park limited to white persons. After the restriction was held unconstitutional, heirs sought reversion of the property. The court refused to apply cy pres and allowed the property to revert rather than alter the benevolent purpose.
Bob Jones University maintained a policy against interracial dating while claiming tax-exempt status as a benevolent trust advancing religion and education. The IRS revoked the exemption. The court upheld the revocation because the policy violated fundamental public policy against racial discrimination.
A testator created a trust to care for minor Black children whose parents had been imprisoned for political crimes. Opponents claimed the trust encouraged criminal conduct. The court upheld the trust as a valid benevolent trust because its dominant purpose relieved a needy class and benefited the community.
A city accepted land in trust to operate a park for white persons only. Private trustees continued the racial restriction after the city withdrew. The court held that continued operation constituted state action violating equal protection and required the trust to be administered without the restriction.
A benevolent trust must serve purposes beneficial to the community such as relief of poverty or advancement of education. A private trust benefits specific individuals and need not produce community-wide benefits.
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The settlor, the attorney general, and persons with a special interest may enforce the trust. The Uniform Trust Code expressly authorizes the settlor to maintain a proceeding to enforce a charitable trust.
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A court may apply cy pres when the charitable purpose becomes unlawful, impracticable, impossible, or wasteful. The modification must direct property in a manner consistent with the settlor's charitable purposes.
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A benevolent trust of perpetual duration is valid. Charitable trusts are exempt from the rule against perpetuities because they serve indefinite community purposes.
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The court may apply cy pres to modify the trust or, if modification is not feasible, the property may revert to the settlor or heirs. A gift-over provision to a noncharitable beneficiary prevails only under limited statutory conditions.
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…adopting in Georgia the common law of charities, Jones v. Habersham , 107 U. S. 174, 180 . We may therefore expect general charitable trust principles to be as fully applicable in Georgia as elsewhere in the several States. Under such principles, there is grave doubt concerning whether a charitable trust for a park could be…