Under most construction contracts, the contractor takes on the ground conditions risk. However, a recent case has demonstrated that the risk can fall on the employer.
Khaira and others v Shergill and others
This case concerned a disagreement involving two factions of two Sikh gurdwaras as regards which of the factions was properly to be considered to be the trustees of (and have the right to govern and manage) the gurdwaras. Central to the case was whether or not a particular individual was the rightful successor to the First Holy Saint of Sikhism and, therefore, entitled to appoint and remove trustees.
The Court of Appeal decided that this case revolved purely around a matter of religious doctrine and practice upon which it could not rule. It refused permission to appeal its decision but acknowledged that it was ultimately for the Supreme Court to decide whether or not it could consider further argument. The Supreme Court granted leave of appeal and considered the matter further. The Supreme Court upheld the long-standing position that the courts should not intervene in relation to matters which relate solely to questions of faith and doctrine. However, this should not be an excuse behind which the courts seek to hide when required to determine issues which, although involving religious organisations where faith and doctrine will be relevant, also involve broader issues of law. This will mean that on some occasions a court will need to consider questions concerning religious belief and practice in order to decide upon, for example, contractual disputes and questions as regards whether or not property which is held for a specific trust is being properly used for the purposes of that trust.
In the case in question the Supreme Court did not seek to pass judgement upon the specific circumstances which had led to the dispute but indicated that it may have to do so if the parties could not resolve their differences. There was, therefore, a little pushing of (or perhaps a re-stating of) the boundaries in relation to the extent to which the courts can and should intervene in matters of doctrine. However, exactly how the courts will cope in adjudicating on such doctrinal matters remains to be seen; the ability of the courts to intervene in such matters does not mean that they will necessarily find it easy in practice to do so.
In this case Ms Louisa Hodkin wished to marry her fiancé at the central London chapel of the Church of Scientology but the Registrar General refused to register the chapel as a place of worship which was necessary in order for it then to be registered under the Marriage Act 1949 for the solemnisation of marriages. Ms Hodkin took the matter to the Administrative Court which upheld the Registrar General’s action but allowed an appeal to the Supreme Court.
The Supreme Court allowed the further appeal unanimously. The first consideration by the Supreme Court was whether or not scientology could properly be regarded as a religion. The judgment handed down concluded that it could and provided a new and wider definition of religion than had previously been recognised in the English courts. Having determined scientology to be a religion then if the chapel was not registered by the Registrar General scientologists would be unable to marry anywhere in a form that involved use of their marriage service since a religious service in their chapel would not constitute a legal marriage (if the chapel was not registered) but neither could they hold a civil marriage on other approved premises which included any form of religious service because of the general restrictions under the Marriage Act. This would be, in the words of one of the judges involved in the case, “illogical, discriminatory and unjust”.
The decision of the Supreme Court raises broader issues since while scientology is now recognised as a religion for the purposes of the Places of Worship Registration Act 1855, applications to register the organisation as a charity have to date been refused by the Charity Commission. This has been on the basis that scientology is not a religion for the purposes of English charity law and that even if it was the church would not be regarded as existing for public benefit. It will, however, be interesting to see whether the decision of the Supreme Court in the Hodkin case will be the springboard upon which the Church of Scientology or other similar organisations seek to launch renewed attempts to obtain charity registration.
Plymouth Brethren Christian Church (PBCC) and Preston Down Trust (the Trust)
This case concerned the refusal by the Charity Commission to register the Trust, a local congregation of PBCC. The Commission’s refusal to register was appealed to the First Tier Tribunal (Charity) where scheduled hearings in the early part of 2013 were stayed until January 2014, by which time the parties announced that the appeal had been withdrawn and that the Commission would accept an application for registration from the Trust based upon a revised governing document which would amend the Church’s core religious doctrines and practices.
The initial objection raised by the Charity Commission concerned the extent to which the Trust’s worship services and other activities were open to members of the general public. However, as discussions between the Trust and the Commission continued the Commission turned its attention to other concerns, in particular the extent to which the detriment, harm or ‘dis-benefit’ to members of the congregation arising from the doctrines and practices of the Trust outweighed the public benefit arising from its religious and other activities.
Based on the evidence presented to it the Commission concluded that there were elements of detriment and harm which prevented it from registering the Trust as a charity. However, when the Trust acknowledged past mistakes, demonstrated a willingness to change and agreed to adopt a revised governing document, the Charity Commission agreed to proceed with registration, noting that it would then monitor the Trust’s performance against this revised governing document.
Whilst the withdrawal of the Tribunal application was of benefit to both the Trust and the Commission (the Trust achieving its objective of charity registration and the Commission avoiding another high profile appearance before the Tribunal), many independent observers were disappointed that the Tribunal did not have the opportunity to consider the particular issues of this case which could have provided useful clarity and legal precedent for the future. Instead, we continue to have grey areas around certain issues of religion and public benefit, in particular what represents relevant detriment or harm to members of the public or adherents of a religion and the relevant considerations in balancing such detriment and harm against the benefits to the public delivered by the organisation. Only at such stage as these issues are considered by the Tribunal are we likely to have any significant clarity.
St Margaret’s Children and Family Care Society (the Society)
This case involved a Scottish adoption agency with close links to the Catholic Church. In March 2013 the Office of the Scottish Charity Regulator (OSCR) confirmed a previous decision requiring the Society to amend external statements, internal guidance and procedures and practice so as to comply fully with the requirements of the Equality Act 2010 or otherwise lose its charity status. The particular issue at question was the extent to which the Society discriminated against same sex couples wishing to adopt.
On 31 January 2014 the Scottish Charity Appeal Panel issued its decision to quash the OSCR decision. The Appeal Panel held that OSCR’s decision review process was procedurally unfair as the decision was reviewed only by those who had originally taken the decision such that there was no objective re-assessment. OSCR had taken the view that Article 9 of the European Convention on Human Rights (Freedom of Religion) did not apply in this case but the Appeal Panel disagreed and ruled that Article 9 was engaged. Further, the Appeal Panel held that whilst there was discrimination against same sex couples this amounted to indirect discrimination and was, therefore, allowed by the Equality Act as a proportionate means of achieving a legitimate aim. Moreover, in reaching its decision OSCR had not fully considered the implications of that decision for the Society (the Society relied heavily upon funding from the Catholic Church which would have been withdrawn if the Society had been forced to comply with OSCR’s requirements which ran counter to the teachings of the Catholic Church) and so, compared with the discrimination complained of, OSCR’s decision was a disproportionate regulatory measure. OSCR considered the Appeal Panel’s decision and after taking legal advice announced in March that, perhaps a little surprisingly, it would not launch an appeal against the decision.
This case came hot on the heels of the Catholic Care case in England and it is, therefore, important to understand the distinctions between the two cases as the outcome of the Catholic Care case was very different. In essence, the difference between the two cases was that Catholic Care wished to impose a complete ban on same sex couples using its services and sought to amend its charitable objects to achieve this outcome. The Society on the other hand did not impose such a blanket ban and showed that it was, in fact, prepared to work with same sex couples if approached by them but maintained a list of preferred criteria which same sex couples would find harder to meet, one criteria being a requirement to have been married for a least two years. Catholic Care’s discrimination had been direct and could not, therefore, be argued to be a proportionate means of achieving a legitimate aim whereas the discrimination by St Margaret’s had been indirect such that the religious exemption could still apply.
It should be noted that this remains a complex and contentious area of law and that each particular case will be judged upon its own circumstances such that one cannot draw any broad conclusions from this case. This point was highlighted by OSCR in its statement confirming that it would not appeal as was the fact that the subsequent passing by the Scottish Parliament of the Marriage and Civil Partnership (Scotland) Act 2014 will also have an impact on cases such as this since it is now possible for same sex couples to meet a marriage criterion.
The advancement of religion as a charitable purpose (and particularly the public benefit arising from activities in pursuit of this purpose) continues to be a bone of contention in many quarters and it is highly likely, therefore, that we will see further cases over coming years which will no doubt clarify and refine the law in various ways.
This article first appeared in the Charity Finance Yearbook 2015.
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