Notice of Meeting: General Purposes Committee

Notice of Meeting:

General Purposes Committee

Meeting Location: Virtual meeting

Date and Time: Monday, 29 June 2020 at 18:00

Contact for Enquiries: Address: Democratic Services, Perceval House, 14 Uxbridge Road, Ealing, London, W5 2HL Telephone: 020 8825 6253 Email: [email protected]

Chief Executive: Paul Najsarek

Committee Membership

Councillor Kamaljit Nagpal (Chair), Councillor Miriam Rice (Vice-Chair), Councillor Mohammad Aslam (Member),Councillor Jon Ball (Member),Councillor Ranjit Dheer (Member),Councillor Sarah Rooney (Member),Councillor Gareth Shaw (Member),Councillor Nigel Sumner (Member),Councillor Hitesh Tailor (Member),

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mailto:[email protected]

AGENDA

Open to Public and Press

VIRTUAL MEETING - LINK TO VIEW

This meeting will be a virtual meeting and therefore will not take place in a physical location following regulations made under Section 78 of the Coronavirus Act 2020. This meeting can be viewed by following this link: LINK HERE

1 Apologies for Absence

2 Urgent Matters

3 Declarations of Interest

4 Matters to be Considered in Private

To determine whether items contain information that is exempt from disclosure by virtue of Part 1 of Schedule 12A of the Local Government Act 1972.

5 Minutes

To approve as a correct record the minutes of the meeting held on 26 September 2019.

Minutes of GPC meeting 26 Sep 2019 5 - 12

6 General Purposes Committee Report 29 June 2020 13 - 86

7 Date of Next Meeting

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https://teams.microsoft.com/l/meetup-join/19%3ameeting_ZWE4OTE2MjUtMzVlMy00OGE4LTgzNDctMTc1MzFmMzE3NWZl%40thread.v2/0?context=%7b%22Tid%22%3a%22013a8c43-8287-4c8b-878b-131e30cdb9f3%22%2c%22Oid%22%3a%22752a0f55-4077-4ff2-99cb-fc11db81bb26%22%2c%22IsBroadcastMeeting%22%3atrue%7d

The next meeting will be held on 17 November 2020.

Published: Friday, 19 June 2020

Paul Najsarek Chief Executive, London Borough of Ealing

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Minutes of the meeting of the General Purposes Committee Date: Thursday, 26 September 2019 Time: 19:00 Venue: Committee Room 3, Town Hall, New Broadway, W5 2BY Attendees: Councillor Mohammad Aslam, Councillor Jon Ball, Councillor Ranjit Dheer, Councillor Kamaljit Nagpal, Councillor Gareth Shaw, Councillor Nigel Sumner, Councillor Hitesh Tailor Apologies for Absence: Councillor Miriam Rice, Councillor Sarah Rooney ALSO IN ATTENDANCE AT THE ABOVE MEETING WERE:

LBE OFFICERS

Mwim Chellah Democratic Services Officer

Helen Harris Director of Legal and Democratic Services

Adam Whalley Assistant Director of Capital Investment Programme

MEMBERS OF PUBLIC EXPRESSED A DESIRE TO ADDRESS THE MEETING:

Will French Friends of the Victoria Hall

Tony Miller CEPAC

1

Apologies for Absence Councillors Rice and Rooney. Councillor Costigan (substitute for Councillor Rooney).

2

Urgent Matters There were none.

3

Declarations of Interest There were none.

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4

Matters to be Considered in Private There were none.

5

Minutes The Committee considered the minutes of the meeting on 25th June 2019. Resolved: that the minutes of the meeting held on 25th June 2019, be agreed, and signed by the Chair, as a correct record.

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REPORT - Victoria Hall Trust In exercising the functions of Ealing Council as Trustee of the Victoria Hall Trust, the Committee received a report with appendices, from Officers, on a number of matters concerning the future of the Trust. The report detailed the following: The Committee had previously received and considered three reports in its capacity as Trustee and had, in particular, considered the proposals to redevelop Ealing Town Hall, of which the Trust property (namely, the Victoria Hall and the Princes Hall) formed part; applications had been made to the Charity Commission seeking to update the objects of the Trust to ensure that its objects were consistent with the requirements of charitable status, and to seek approval for a scheme enabling the Trust to dispose of Trust property (such disposal being a necessary consequence of the arrangements to be made with Mastcraft to enable the redevelopment of the Town Hall). The applications also involved a “land swap”, as previously reported to the Trustee (that is, swapping the Prince’s Hall (Trust property) with the Queen’s Hall (Council property). There had been detailed correspondence relating to the applications with the Commission. However, the Commission had not made decisions. A meeting was held with the Commission on 10th July 2019 to understand what further information was required by the Commission for them to make decisions and to, then, instigate the further formal steps to authorise the disposal, and approve the updated objects. The meeting (10th July 2019) was useful in that it enabled the Commission’s representatives to see the Town Hall and confirm what further and final information was needed by the Commission. Following the meeting, the Commission confirmed that the meeting provided significant and useful clarification about the context in which the Trustee will further consider the options available to it. The main issue of concern to the Commission was that they needed to see clear evidence that the Trustee had undertaken an independent “charity’s interests” evaluation of all the options available. It would be acceptable for that evaluation to rely on material and information

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previously made available to the Trustee. The Commission confirmed that the Trust would also need to identify that there was a “cy pres” occasion which underlay any choice of an option that would result in a disposal. If the Trustee was minded to continue supporting the Mastcraft disposal, it had to demonstrate to the Commission that the Trustee had fully assessed all identified options and had concluded that the Mastcraft proposal represented the best option, consistent with the original purposes of the Trust. That required the Trust to have considered and be in agreement with the benefits of the Mastcraft proposal, and to be satisfied that that was preferable to all other options. In that regard, the “benefits” were to be assessed in relation to the intended beneficiaries of the Trust, and not the benefits to the Council. The way in which the scheme had evolved since 2014, including, in particular, the requirements of the Commission, showed that the information submitted to them on behalf of the Trust had, inevitably, been provided in a piecemeal way. The report was intended to draw all previous and current issues together into a single report. The purpose of the report was, therefore, twofold: to present the Trust with a complete position and basis on which to reach a decision; and to enable the Charity Commission to be satisfied that the relevant legal tests had been met. Guided by the Charity Commission’s feedback, and over-lapping with section 5 of the report, Trustees were drawn to the following: the Mastcraft proposal involved a “disposal” of designated charity land; it was that disposal that required authorisation under charity law, via the Charity Commission; the implications of the “community use protocol” for the Victoria Hall; the cy-pres implications, as between the Princes Hall and the Queens Hall; Mastcraft would be responsible for external repairs and maintenance under the terms of the Lease, which the Trust may regard as being a benefit as it would remove uncertainty about the ongoing financial support of the Council; the consent of the Charity Commission is also required to authorise change of objects proposals; these are required in order to bring the Trust’s objects into line with the requirements of modern charity best practice; the Trustee had to consider the range of options available to it, as described in paragraph 4 of the report. That would include a “do-nothing” option; and the Trustee had to be satisfied that it had had all the necessary independent advice (in addition to the independent valuation report), particularly in relation to the choice of whether to “opt-in” to the Mastcraft scheme. The Committee received a presentation from the Friends of the Victoria Hall Trust, presented by Mr Will French. (A detailed submission, with appendices, and summary had been circulated to the Committee before the meeting.) Mr French urged the Committee members to reflect on their responsibilities as Trustee.

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Mr French explained that they were responsible to the beneficiaries of the Trust, and not to either the Council or its officers. The Trust had important duties laid down in law and well summarised by the Charity Commission. These included: understanding the charity’s purpose, as set out in the 1893 Trust document; setting the Trust’s direction —and ensuring the Trust operated effectively by taking independent reports and advice. Mr French argued that, hitherto, inadequate information had been provided to the Trustees. Mr French also argued that the Committee had “never discussed” how the Trust was supposed to serve the public benefit. He believed that the following information was missing: a strategic framework; budget; financial plan; and asset register. Mr French was particularly critical of the failure to prepare separate accounts for the Trust until very recently. He argued that the accounts now before the Committee were inadequate and overstated the level of subsidy provided by the council to the Trust. Mr French was critical that there had been no separate consultation by the Trustees with stakeholders. Mr French said he believed some parts of the report were “impossible to digest”, despite reading it “several times”. He said that the sections on the Mastcraft deal (paragraphs 4.16 to 4.25) were “totally opaque”. He highlighted the following as being “wrong or misleading” in the report: the extent of the Trust property; Trust finances; the independent valuation; and the review of the options for the Trust’s future direction. Mr French said that there were conflicts of interest in the Trust pursuing a course of action that favoured the Council in its need to reduce the costs of maintaining the rest of the Town Hall, not the Trust’s assets. He said the Charity Commission noted that those issues should not be relevant to Trustee and that the Trust should do only what was best for the charity in carrying out its purposes and avoid conflicts with their loyalty to any other body, like the Council. Mr French made the following further points in relation to the options available to the Trust:

1. the Mastcraft deal was “very vague” as monetary benefits were unquantified. How would their value to the Trust be known? Much weight had been given to the community use covenant. Neither the Trustee or the beneficiaries had discussed it but it had been agreed apparently.

2. over the long term it would be “impossible” for the Trustee to enforce the community protocol or secure the financial commitments in the Trust’s interests. Alternative options have been dismissed “with short shrift”;

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3. the report should have mentioned earlier discussions between the Council and Ealing Arts, a social enterprise company, to convert the Town Hall into an arts and leisure centre; and

4. later proposals by Ealing Voice and CEPAC sought a partnership working with the Council. Those got “nowhere” because, having selected Mastcraft as its development partner, these initiatives never stood a chance.

Mr French asked the Trustee to reflect on the nineteenth century benefactors who put up the money for the Trust. Generations of Ealing residents had used Trust Property for numerous social, political and cultural activities. Mr French reminded the Trust that Victoria Hall has welcomed Prime Ministers. It had staged rallies, such as “Save the NHS”. It had been a place for Ealing’s minority groups — hosting Diwali and Durga Pudja events, in addition to Polish, Armenian and Arab cultural evenings. There had also been election hustings, concerts, carol services and model railway exhibitions. Mr French argued that other governance models were available to the Trust which did not involve the council, and which would not surrender the Trust and its assets for the next 250 years. Officers advised that various options had been considered, including the ones advanced by various community groups, such as Friends of the Victoria Hall Trust. The advice of Officers was that the deal with Mastcraft was considered the most viable and in the best interests of the Trust in the long term. However, it was open to the Trustee to reject the Mastcraft deal should it not agree with that recommendation. Officers advised that, in their professional view, it would be very difficult to maintain, manage and operate effectively the Trust Property independently from the rest of the Ealing Town Hall. However, it was open to the Trustee to request that option be investigated more fully, should it not agree with the report recommendations. (Councillor Tailor excused himself from the meeting at 8pm and did not vote on the Report’s recommendations.) The Committee also received a submission from Mr A H J Miller, Secretary of the Campaign for an Ealing Performance Arts Centre (CEPAC). Mr Miller was unable to attend the meeting and so, at Mr Miller’s request, Councillor Ball presented the statement on his behalf. The statement was read verbatim by Councillor Ball:

“Had I been able to address you this evening, which unfortunately I can’t, I would have asked you just two

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questions about why you are even considering the proposals to support the Council’s Mastcraft deal – a deal which will effectively end the existence of the Trust as an independent body, dedicated to the objectives of Trust Deed. The first question is: do you honestly believe that you as Trustees, acting through the Council as manager, can no longer effectively operate the property of the Trust to meet the undoubted need which exists in the community? Any other reason would, in the words of the Charity Commission, be “irrelevant” to meeting your obligations under the Trust Deed, and therefore inadmissible. But if you do believe that, the second question is: why will you not consider handing over the facilities to be run by another, independent, body of Trustees, in the same way as is being successfully done with Pitzhanger Manor? A separate charitable Trust could raise new money and take over responsibility for meeting the objects of the Trust Deed, in the interest of local people. I urge you in the light of all the evidence now before you to choose that option.”

In the discussion that ensued, Councillor Dheer took cognisance of adopting the Pitzhanger Manor model in redeveloping the Town Hall as proposed by various community groups. However, the facts were different. The former was a “standalone, self-contained” facility, whilst the latter was not. (Councillor Aslam excused himself from the meeting at 8:25pm and did not vote on the Report’s recommendations.) Councillor Shaw was concerned about the “prohibitive costs” of maintaining the Trust Property. Officers reminded the Trustee that maintenance had historically been carried out by the Council on behalf of the Trust, but, that going forward, the Council had made it clear that such Council subsidy for this purpose was no longer available. Officers advised that the discounted rates for community use would last for the duration of the entire lease duration of 250 years. Although rates would be reviewed after 10 years, any upwards adjustments to

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discounted community rates would have to be agreed upon by all stakeholders, including the Trustee. Resolved: that the General Purposes Committee:

1.1 notes the outcome of a meeting between officers and the

Charity Commission which took place on 10 July 2019; 1.2 notes and agrees the extent of the property held under the

terms of the Trust, as shown, edged with a solid or dashed black line, on the plans at Appendix 1;

1.3 notes the independent valuation report commissioned on

behalf of the Trust attached at Appendix 4;

1.4 considers the range of options available to the Trust in respect of its future, in light of the proposals for development of Ealing Town Hall, agreed between Ealing Council and Mastcraft, and which includes Trust property. Determines that the proposal agreed between Ealing Council and Mastcraft, which includes Trust Property, is in the best overall interests of the Trust and that accordingly no alternative option should be pursued;

1.5 authorises the Assistant Director Capital Investment

Programme, following consultation with the Chair, to conclude the necessary legal steps, including (i) the Agreement for Lease to be entered into (between the Council, Mastcraft, and Trust), (ii) final detailed settlement of the Community Use covenant having regard to paragraph 4.27 of this report, and (iii) the further application to and associated dealings with the Charity Commission necessary to progress the scheme on that basis; and

1.6 authorises the Assistant Director Capital Investment

Programme, following consultation with the Chair, to settle the apportionment of the lease premium and rent paid by Mastcraft (as well as the fair and reasonable contribution to be made by the Trust towards the Council’s costs), in accordance with the advice received from the independent Valuer (and any further valuation advice required in that respect).

The Trustee’s decision on resolutions 1.1 and 1.3 (above) was unanimous. Councillors Nagpal (Chair), Dheer, Midha and Shaw voted in favour of approving resolutions 1.2, 1.4, 1.5 and 1.6 (above). However, Councillors Ball and Sumner voted against resolutions 1.2, 1.4, 1.5 and 1.6 (above).

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Date of Next Meeting The next meeting of the General Purposes Committee was provisionally scheduled for 30th October 2019 at 7pm.

The meeting finished at 8:40pm. COUNCILLOR NAGPAL (CHAIR)

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Contains Confidential or Exempt Information

No

Title Victoria Hall Trust

Responsible Officer(s) Adam Whalley Assistant Director Capital Investment Programme Helen Harris (Director of Legal & Democratic Services)

Author(s) Adam Whalley

Portfolio(s) N/A

For Consideration By The Trustee of the Victoria Hall Trust (acting by General Purposes Committee)

Date to be Considered 29th June 2020

Implementation Date if Not Called In

N/A

Affected Wards Ealing Broadway

Keywords/Index Victoria Hall, Princes Hall. Trust, redevelopment, Charity Commission, disposal

This report updates the Trustee of the Victoria Hall Trust on matters relating to the Trust and in particular the latest response from the Charity Commission, and it seeks decisions necessary to inform the response to the Charity Commission.

1. Recommendations

It is recommended that the Trustee

1.1 Notes the Charity Commission’s review of the decision to make a Scheme for the regulation of the Trust, attached at Appendix 1

1.2 Considers and makes decisions on the points and options set out in Appendix 4, to inform the response to the Charity Commission

1.3 Considers whether to hold a further meeting, to give more detailed direction, prior to that response being sent

1.4 Authorises the Assistant Director Capital Investment Programme, acting for the Trustee, to take the steps decided by the Trustee and to reply to the Charity Commission’s review on behalf of the Trustee, following consultation on the draft response with the Chair of the Trustee body and the Director of Legal and Democratic Services

Report for: ACTION Item Number: 6

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2. Purpose of this Report 2.1 General Purposes Committee continues to exercise the functions of the Council as Trustee of the Victoria Hall Trust. The Committee has now received and considered four reports in its capacity as Trustee and at its last meeting on 26 September 2019 considered a comprehensive report intended to enable a final decision to be made by the Trustee about the proposal for the Trust property and in order to assist the Charity Commission in reviewing the resulting applications. 2.2 Full details of the background to the proposals and details of the proposals themselves were set out in that report and are therefore not repeated here except to confirm that the original reason for the application to the Charity Commission was twofold, namely to update the objects of the Trust, given that the existing objects of the Trust are no longer compliant with modern charity law, and to seek consent for the disposals arising from the Mastcraft proposals.

2.3 The legal context is that the Trusts of Land and Appointment of Trustees Act 1996 provides the Council with the powers of an absolute owner as the sole trustee of the Trust. In principle this includes the power to dispose of Trust property as is envisaged as part of the Mastcraft proposal. However, this is restricted by section 62 of the Charities Act 2011 which sets out the circumstances in which the original purposes of a charity can be altered to allow property to be applied for a different purpose. 2.4 To alter a charity’s purpose, the court or the Charity Commission must make what is known as a “cy-près scheme”. A cy-près scheme (Scheme) is a legal arrangement that allows charitable property to be applied for charitable purposes which are similar to the original purpose(s).

2.5 When making a Scheme, the Commission can provide for Trust Property to be applied for such charitable purposes as it considers appropriate, but it must have regard to the matters set out in subsection 67(3) of the 2011 Act. These are:

(a) the spirit of the original gift; (b) the desirability of securing that the property is applied for charitable purposes which are close to the original purposes; and (c) the need for the relevant charity to have purposes which are suitable and effective in the light of current social and economic circumstances.

2.6 Following consideration of the September 2019 report General Purposed Committee as sole Trustee resolved that (subject to necessary consents) it still wished to proceed with the Mastcraft scheme and authorised officers of the Council, acting on the Trust’s behalf, to conclude the necessary legal steps, including

(i) the Agreement for Lease to be entered into (between the Council,

Mastcraft, and the Trust), (ii) final detailed settlement of the Community Use covenant, and

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(iii) a further application to and associated dealings with the Charity Commission necessary to progress the Scheme on that basis.

2.7 In addition, officers of the Council were also authorised to settle the apportionment of the lease premium and rent paid by Mastcraft (as well as the fair and reasonable contribution to be made by the Trust towards the Council’s costs), in accordance with the advice received from the independent valuer attached to the September report (and any further valuation advice required in that respect).

2.8 Following the meeting on 26 September 2019 the minutes were sent to the Charity Commission who confirmed that they were satisfied that

a. The decision of the Committee appeared to have complied with the Trustee's decision-making responsibilities, and that the mechanism of the Committee making the decision sufficiently addresses the Council's conflict of interest in making a trustee decision (given its other interests in the Mastcraft proposal). b. A cy-près occasion has arisen, and therefore a Scheme can be made that would (amongst other things) permit the Trustee to enter into a lease as a (new) mechanism for the continued operation of the Trust Property for its existing purposes.

c. Once they had agreed the draft Scheme, they were likely to require the draft be published for 30 calendar days.

2.9 The wording of a draft Scheme was subsequently finalised by the Charity Commission in November 2019 and was published with closing date of 7 January 2020 (see Appendix 2).

2.10 The representations made in response to the draft Scheme included a petition signed by 1,400 people and a detailed 41-page document prepared by the Friends of Victoria Hall.

2.11 The Charity Commission then reviewed the draft Scheme taking the responses and other background information into account and sent its findings to Council officers in April 2020 (see Appendix 1). Although there are many factors to be given attention, the thrust of the Charity Commission response is that further consideration needs to be given to the following in particular:

a. The extent of the charity’s property b. The needs of the public in Ealing c. The use of the premium d. The Charity’s future use of the Victoria Hall e. Managing conflicts of interest.

2.12 The Charity Commission’s findings are set out in table form in Appendix 4. In summary the Charity Commission consider that

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a. The existing primary object of the Trust is to ‘provide facilities for recreational and other leisure-time occupation by members of the public in Ealing and its neighbourhood in the interest of social welfare’. b. Despite representations to the contrary by those opposed to the Mastcraft proposals, the preservation of the Trust property itself (i.e. the Victoria and Princes Halls) is not integral to the purpose of the Charity. c. The circumstances provided for in the Charities Act 2011 exist and that they therefore continue to agree in principle that a Scheme can be made to authorise the disposal of the Victoria and Prince’s Halls.

2.13 However, the Charity Commission also confirmed that a Scheme can only be made if the property realised by the Trust as part of the overall transaction with Mastcraft can be applied for charitable purposes ‘that are more suitable and effective than the original purposes’. By “property realised”, the Charity Commission mean the Town Hall as it will be developed and then regulated by way of the lease to Mastcraft. In this context, and as referred to by the Charity Commission, regard must be had to matters set out in subsection 67(3) of the 2011 Act referred to above namely

(a) the spirit of the original gift - the Charity Commission are of the view

that this is ‘the provision of facilities for recreation and other leisure time occupation in the interest of social welfare for the public of Ealing and its neighbourhood’;

(b) the desirability of securing that the property is applied for

charitable purposes which are close to the original purposes which the Charity Commission consider to be facilities in Ealing i.e. not necessarily the Victoria Hall or Prince’s Hall;

(c) the need for the Trust to have purposes which are suitable and

effective in the light of current social and economic circumstances. The Charity Commission consider a number of factors to be relevant to this aspect including demand in the area for recreational/leisure time facilities, modern requirements for facilities, whether the Town Hall building adequately meets current needs and whether there are individuals or groups needing facilities which would not be met by the refurbished halls.

2.14 Given that the Charity Commission agree that a Scheme is appropriate, they have then considered whether the changes facilitated by the Scheme as currently drafted will provide ‘a more suitable and effective method of using the property’.

2.15 Factors that the Charity Commission acknowledge make the use of Trust Property following the making of the proposed Scheme more suitable and effective as are follows: -

(a) The Trust is relieved of the financial burden of the upkeep and

maintenance of the Victoria Hall as this will in future be the responsibility

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of Mastcraft who will also be under a duty to renew and replace fixtures and fittings as necessary.

(b) The Victoria Hall will be renovated at the expense of Mastcraft.

(c) The Trust will still have access to the refurbished Victoria Hall for use by qualifying community groups at preferential rates on (potentially) 355 days a year.

(d) A working group will be established, which may co-opt members from the

community, to monitor and review the use of the Victoria Hall in accordance with the Scheme.

(e) The Trust will obtain a sub-lease in the Victoria Hall and a sub-sub lease

in the Queens Hall.

2.16 However, factors that the Charity Commission consider make the use of the

property as proposed less suitable and effective include the following: -

a. The Trust will no longer have a freehold interest in its property and therefore lose full control of it.

b. The Commission is still unclear as to whether the proposals are the best ones that can be obtained for the Trust.

c. The fact that the hotel operator will control bookings for the Victoria Hall could be detrimental to the Trust.

d. There is concern as to how the community use covenants can be enforced.

e. The fact that hire of the Hall will be restricted to registered charities and non-profit community groups might preclude other users.

f. Any profit from income from letting Victoria Hall will not be available to the Trust.

g. The refurbished Victoria Hall may not be the most suitable type of venue for recreational and leisure time use in the modern day.

h. The preservation of the Victoria Hall is not an object of the Charity. i. The timing of the swap of the Princes hall for the Queen’s’ Hall will reduce

income due to the Trust. j. The Commission has not seen any assessment as to which of the Princes

and Queen’s Halls best meets the needs of the public for recreational and leisure time occupation.

2.17 With regard to the terms of the Scheme itself, the Charity Commission make

the following comments on their original draft wording a. There should be provisions relating to the premium and for applying the

future income of the charity. b. There should be an obligation on the Trustee to appropriate the Queen’s

Hall for the purpose of the charity. c. There should be a mechanism for managing conflicts of interest which

may arise between the Council and the Trust.

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2.18 The Commission concludes that the Scheme as drafted, and the proposals negotiated with Mastcraft, cannot as yet be said to be a ‘more suitable and effective use of the property’ than the original purposes and that therefore the Trust needs to give further thought to the following in particular

f. The extent of the charity’s property g. The needs of the public in Ealing h. The use of the premium i. The Charity’s future use of the Victoria Hall j. Managing conflicts of interest.

3. Matters for Consideration and Decision 3.1 Officers have been in discussion with the Charity Commission over a number of years on behalf of the Trust, and the Commission itself drafted the proposed draft Scheme which was published in November 2019. Officers have reviewed the new issues raised by the Charity Commission in detail and have set out information and suggestions for consideration and approval by the Trustee, as appropriate, in the table at Appendix 4.

3.2 The issues that the Trustee need to consider have been grouped under main headings in the table together with any relevant additional background information and options to be considered. Recommendations have also been made but the Committee as sole Trustee must come to its own conclusion as to what response should be made in its name to the points raised by the Charity Commission.

3.3 By reason of the complexity of the issues, and the importance of the Trustee acting independently, the Trustee should consider whether it will be appropriate to hold a further meeting, to discuss the response to the Charity Commission in more detail, once officers have carried out further work in line with directions given by the Trustee at this June meeting.

4. Legal Considerations

4.1 Members of General Purposes Committee are making decisions as Trustee of the Victoria Hall Trust/ charity and are therefore bound by charity law to act in the best interests of the charity and its beneficiaries both generally and with regard to the particular decisions it makes under this report. In making the decisions, the Trustee should have due regard to relevant guidance and advice issued by the Charity Commission but not limited to, the Commission guidance on the roles and responsibilities of trustees (CC3), guidance on local authorities acting as trustees, guidance on changing the charity’s objects, guidance on the disposal of charitable property (CC28) and guidance on identifying and managing conflicts of interest (CC29).

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https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/866947/CC3_feb20.pdf

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/622147/CC28.pdf




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4.2 When considering the proposals which are put forward by the Council regarding Ealing Town Hall, as well as other available options, the Trustee is under a duty to consider the duties set out in the following paragraphs.

Duty to carry out its purpose for the public benefit

4.3 The Trustee is aware that the current status quo regarding the maintenance of the charity’s property by the Council using public funds cannot continue due to the financial restraints placed on the Council. The Trustee is legally required therefore to find an alternative solution in order to protect the assets of the Trust and ensure that the public continue to benefit from the charity.

4.4 Advice has been obtained from an experienced charity law barrister on the governing document(s) of the charity who confirmed that charitable objects of the charity were vague and imperfect. There was a risk that the objects may not give effect to the wishes and intentions of the original subscribers to the charity and the purpose for which the charity was established. The barrister advised that the Council apply to the Charity Commission for a Scheme to update the charitable objects of the charity to more accurately reflect the original purposes for which the charity was established. The Charity Commission has drafted a proposed Scheme to apply new charitable objects via cy-près and the Council is asked to consider these proposed objects to ensure that the charitable purpose of the charity is maintained. A ‘cy-près’ Scheme is one which is as near as possible to the original trustee’s intentions when these cannot be precisely followed. The Scheme, when published by the Charity Commission, would cover the disposal and change of charitable objects.

Compliance with the charity’s governing document and the law

4.5 As stated above, expert external legal advice was obtained on the governing document of the charity and its potentially imperfect charitable objects. On the basis of that advice, and in order to comply with its legal duties, the Council applied for a cy-près Scheme from the Charity Commission, to apply new charitable objects in line with the original purposes for which the charity was established. In response to that application, the Charity Commission has now asked that the Trust provide further information and clarification, as set out in the Charity Commission’s April review document (Appendix 1).

Manage your charity’s resources responsibly

4.6 The Trustee, as sole charity trustee, is required to manage the assets of the charity in a reasonably prudent manner and to protect them for the benefit of the beneficiaries of the charity. The Trustee is aware that the Council has made clear that the current arrangement regarding the ongoing maintenance of the Trust Property being significantly subsidised by Council funds cannot continue. The Trustee is therefore also aware that removal of that subsidy will leave a shortfall in the income of the charity. In turn, this could lead to the Trust Property becoming dilapidated. The Trustee may therefore consider that, in contrast with other options, the assets of the charity can be best protected through entering into the

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lease arrangements with Mastcraft, through which the charity’s assets will be maintained and protected long-term whilst still being available to the beneficiaries of the charity to use in accordance with the charity’s charitable objects.

Ensure the charity is accountable

4.7 The Trustee approved the approach for the accounts for the Trust, at its meeting of 16th April 2019. The Council has admitted to historic failings in this area but is now committed to clear and open accountability for the Trust. A further report will be brought back to the Trustee as soon as possible, with an update on the accounts position.

Conflict of Interest

4.8 There is potential for a conflict of interest (or perception thereof) regarding the Council’s dual role as a local authority and trustee of the Trust, and this has already been recognised by both the Council and Trustee. The Council has therefore sought, obtained, and followed both independent legal advice and guidance from the Charity Commission throughout this process and will continue to do so. The Trustee should, as always in considering this report, reach an independent judgement as Trustee, and consider and decide whether it feels it has received sufficiently independent advice necessary to inform its decision-making.

Appendices Appendix 1 – Charity Commission Review April 2020 Appendix 2 Draft Scheme

Appendix 3 Community Use Protocol Appendix 4 Table of Charity Commission requirements and officers’ comments on those recommendations

Background Information

Full Council report 19 December 2017 General Purposes Committee reports – 15 March 2018, 15 January 2019, 16 April 2019 and 26 September 2019 Cabinet reports 21 October 2014, 12 July 2016 and 12 February 2019 Charity Commission Guidance including CC3, CC28 and CC29

https://www.gov.uk/government/organisations/charity-commission/about/publication-scheme

Report History

Decision type: N/A Urgency item? No

Report no.: Author: Adam Whalley

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Charity: Victoria Hall, Ealing

Unregistered charity number: 4057721

Review of the decision to make a Scheme for the regulation of the Charity

1. Introduction 1.1 This is a review of the proposal to make a Scheme for the unregistered charity known

as Victoria Hall, Ealing (“the Charity”).

1.2 In May 2017, the Council of the London Borough of Ealing (“the Council”), the trustee

of the Charity (“the Trustee”), applied to the Commission for a Scheme. After lengthy

correspondence and a site visit, the Commission agreed to make the Scheme and, in

November 2019, finalised a draft Scheme. In accordance with section 88 of the

Charities Act 2011 (“the 2011 Act”), the Commission and the trustee (as agent of the

Commission) gave notice of the Commission’s proposal to establish a Scheme. The

notice invited representations to be made to the Commission within a period

specified in the notice. The Commission received representations, including a

petition. Under section 88(5), the Commission must, where it gives public notice,

take into account any representations made to it within the period specified in the

notice.

1.3 I was appointed to review the representations in accordance with section 88(5) of the

2011 Act and the Commission’s Decision Review procedures which are set out in the

publication “Dissatisfied with one of the Charity Commission’s decisions: how can we

help you?” available on the Commission’s website. I am Neil Robertson, Head of

Technical Casework & Quality Assurance. I have not previously been involved in the

conduct of the case. This decision represents a final decision of the Commission.

1.4 The issue for the decision review is whether the Commission should proceed to

make the Scheme, with or without modification, or if it should withdraw the Scheme.

In doing so, I can only consider matters that are relevant to the Charity according to

the legal framework for making the Scheme.

1.5 In conducting this review, I have been mindful of the public sector equality duty set

out in section 149 of the Equality Act 2010. I have therefore had regard to the needs

set out there: to eliminate discrimination, harassment, victimisation and any other

prohibited conduct, to advance equality of opportunity and to foster good relations.

1.6 In making the decision, I have considered:

• the representations made in response to the draft Scheme, including a petition signed by 1,400 people and a detailed 41-page document prepared by the Friends of the Victoria Hall, Ealing (“the Friends”) which I found very helpful;

• the draft Scheme (finalised November 2019);

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• other relevant documents from the Commission’s case files, including all of the information supplied to the Commission by the trustee and others during the course of the case, particularly the report to the General Purposes Committee dated 10 September 2019;

• the charity’s governing document – the deed of 1893;

• the power to make a cy-près Scheme in the 2011 Act, particularly sections 62 and 67;

• the Commission’s Operational Guidance (particularly OG 2 – Application of property Cy-près); and

• the Commission’s statutory objectives, functions and duties (as outlined in sections 14-16 of the 2011 Act) and its public law duties.

2. Background to the Scheme

2.1 The Charity

2.1.1 By a deed of 6 December 1893, members of the Ealing Local Board declared trusts

over the property, including the property known as the Victoria Hall. The trust

property was to be used “for the purpose of meetings, entertainments, balls, bazaars

and other gatherings whether social or political”. Income, after deduction of the

expenses, was to be applied to “any charities or philanthropic charitable institutions in

the district of the Ealing Local Board”.

2.1.2 The deed provided for imperfect trusts that were not exclusively charitable. During the current case, the Commission initially considered that the property was not held on exclusively charitable trusts, but then took the view that the trusts had been validated by the Charitable Trusts (Validation) Act 1954. It noted that, on 28 June 1957, the Commission had made an Order to authorise a sale of the organ, which it would only have done if it was charitable property, and, in a letter of 10 July 1957, the Commission had said that the words " or philanthropic" should be treated as if they were deleted.

2.1.3. The primary purpose of the Charity appears to be the provision of a facility in Ealing

for community use. The Commission has been made aware of the varied activities that have taken place in the Halls over the years until bookings were recently halted.

2.1.4 Clause 5 of the Charities Act 2011 provides that it is charitable to provide facilities for

recreation or leisure time occupation if the facilities are provided in the interests of social welfare. It further provides that the facilities must be provided with the object of improving the conditions of life for the persons for whom the facilities are primarily intended. In this case, the facilities are intended for the public at large.

2.1.5 The secondary purpose of the trust, should there be surplus funds, is to financially

assist charities in Ealing. The Commission understands that, initially, the operation of the Halls made a profit, which was distributed to local charities, such as for the benefit of local almshouses. So far as the Commission is aware, there has not been any distribution of funds under this purpose for many years.

2.1.6 Although originally the Halls were administered by a separate committee, over time it

became managed as part of the Council’s property along with the other rooms in the Town Hall. Records show that, in 1936, it was suggested that the property be leased to the Council in its corporate capacity with the Council then paying for the upkeep and

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maintenance out of the general rate fund. Although no documentation was entered into, the Council in its corporate capacity took over the running of the Halls from that time. During the elapse of time, the Council no longer recognised that the property was held on charitable trusts, including when it considered and negotiated the disposal of the Town Hall building between 2014 - 2016. Therefore, the trust has not been operated as a charity for many years until recently and separate accounts have not been prepared. This also means that, any conflicts of interest that may have arisen between the Council as trustee and the Council in its statutory capacity will not have been managed.

2.1.7 The Charity has not been entered on the register of charities, although there is

evidence that the Commission chased registration in 1966. The Council is under a legal obligation to apply for registration by virtue of s.35(1)(a) of the Charities Act 2011. Initially the Commission said that the Charity should be registered before the Scheme was made, but has now accepted the Trustee’s undertaking to register the Charity when the Scheme is made.

2.2 The Property

2.2.1 The property was constructed on land originally owned by the Local Board, which it

settled on charitable trust under a power in section 175 of the Public Health Act 1875.

Completed in 1888, the property was built to commemorate Queen Victoria’s Golden

Jubilee using monies raised by public subscription from the inhabitants of Ealing. It

principally comprises of the Victoria Hall at first-floor level and, at ground and

basement level, Princes Hall. An extension to the original building was added in

1899.

2.2.2 The two halls, which are large function rooms, are attached to, but separate from, the

Grade II listed municipal Town Hall . The main entrances to the Halls are by way of

the main Town Hall street entrance, with the Victoria Hall accessed from a staircase

at first floor level. The Prince’s Hall has its own street level entrance and the two

buildings share a common service staircase. The Council considers that access to

the Charity’s property through the street level entrance would be impractical for use,

other than in an emergency or for event-related deliveries, as it is direct from the

highway pavement, although this has been disputed by some making

representations. However, as I understand it, access to the Halls is usually gained

by way of the main Town Hall entrance.

2.2.3 The 1893 deed refers to the Victoria Hall and “the rooms and offices belonging

thereto”, but does not identify the extent of the property and there is no plan attached

to it. The trustee has identified the area that it believes to be held on trust, being the

Victoria Hall and the Prince’s Hall. This does not, for instance, include the kitchen

area adjoining the Prince’s Hall. This has not been disputed, but those making

representations suggests that the area is larger than just these two halls. Research

by the Friends suggest that “the rooms and offices” include other rooms, such as the

Artists Rooms and the cloakrooms/toilets. It points to the subsequent 1899 extension

and also suggests that the Charity will have the benefit of easements through the

Town Hall. The size of the trust property is particularly important since the premium

for the disposal of the Town Hall is to be apportioned between the Council and the

Trust on the basis of floor area.

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2.2.4 I note that in 2016 an application was made to register the Town Hall as an asset of community value. No bids to purchase all or part of the property were made by or on behalf of the community within the relevant six-month timescale required.

2.2.5 The Commission considers that the property is “designated land. “Designated land” is

a term used in the 2011 Act and refers to land which is settled on specific charitable

trusts and is required to be used for a particular purpose(s) of the charity. In this

case, the land is required to be used for the purposes set out in the 1893 deed.

2.2.6 It is relevant that there was no accompanying endowment for the maintenance of the property and no reserves have been accumulated1. It appears that, since at least 1936, repairs, maintenance and major renovations have been undertaken by the Council from its own resources. The Commission understands that, apart from routine maintenance work, there are significant overdue building repair works. The Council’s Leader has told the Commission that “the budget is no longer there for the Council to subsidise the building continuing to open”.

2.3 The Trustee

2.3.1 The original trustee was the Local Board for the District of Ealing, being the local

authority at the time. This became an urban district council in 1894 and then, by

virtue of various reorganisations of local government, the functions of the local board

are now exercised by the present Ealing Council. I understand the area of the

modern London Borough of Ealing to be larger than the original area as a result of

local government re-organisation in 1965.

2.3.2 As mentioned above, the Council has not operated the Trust as a charity and has

therefore not historically managed the conflict of interest that exists between its

corporate role as local authority and its role as charity trustee. It now seeks to

manage this by acting through its General Purposes Committee. I note that this

committee does not contain any independent members; they are all members of the

Council.

2.3.3 The draft Scheme provides that Ealing Council would continue to be the trustee of

the Charity for all purposes.

2.4 The proposals

2.4.1 Since 2014, the Council has been looking to dispose of the Town Hall. The building

needs repair and refurbishment and, with current funding pressures on the Council, it

considers that it is unaffordable for the Council to refurbish it. It ran a competitive

tendering process for the redevelopment of the building, including the trust property.

Following this, in 2016, the Council entered into a deal with the company Mastcraft. I

note that the Register of Companies issued Mastcraft with a notice for compulsory

strike off on 31 March 2020.

2.4.2 Under the proposals, set out at 2.4.4 below, the Town Hall (including the charity’s

trust property) would be disposed of on a 250-year lease. Mastcraft has established

a company called Surejogi Ealing Town Hall Limited (“the Company”) to redevelop

the building to provide a hotel, restaurant and leisure facilities. Part of the Town Hall

1 I note that, when the organ was disposed of in 1957, the proceeds were donated to local charities and not invested.

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will be sub-let back to the Council in its corporate capacity to use for its own

purposes and the Victoria Hall will be sublet back to the Council as trustee. The

Charity will lose its freehold interest in its property and will not receive any

replacement land, other than a limited sub-lease of the Victoria Hall and sub-sub-

lease of the Queen’s Hall.

2.4.3 At the time when the re-development was agreed, the Council was not aware of the

Charity’s existence. Therefore, no consideration was given as to whether the proposal was in the Charity’s best interests, including whether there were other alternatives to the deal with Mastcraft that might better suit the Charity.

2.4.4 The proposals are:

• The Town Hall would be leased for 250-years to Mastcraft at a premium of £2,500,551 and annual rent of £250,000. This would include all of the charity’s property. The Charity would receive a proportion of the premium and annual rent, worked out on the basis of the charity’s percentage ownership of the Town Hall.

• The developer would grant the Charity an underlease of the re-developed Victoria Hall. This Hall will be reduced in size, including the loss of backstage facilities. The Charity would have use of this property under “community use” arrangements2 to be set out in the lease as an enforceable covenant. The arrangements would allow qualifying community groups to hire the premises at set rates to be reviewed after 10 years, but on the basis that they remain affordable. The Council has said that these arrangements are designed to closely mirror current use by the Trust. Mastcraft would be responsible for repairs and maintenance of the property under the terms of the lease.

• The Council owned Queen’s Hall would be ‘swapped’ for the Charity owned Prince’s Hall, which is required by the company for its hotel. The Queen’s Hall would be sublet by the developer to the Council in its corporate capacity, who would then sublet it to itself as trustee at a consideration of £1.

2.4.5 The Trustee carried out two consultations between November 2017 and May 2018 to

which 275 representations were received. Although this process has been described as flawed by some of those making representations to the Scheme, it was carried out as part of the Trustee’s fact finding to ensure that it was properly informed and not as part of a legal process.

3. Why a Scheme is needed 3.1 If the proposals go ahead, all of the charity’s land will be disposed of.

3.2 The Trusts of Land and Appointment of Trustees Act 1996 (TLATA) provide trustees

with the powers of an absolute owner, which include the power to dispose of

property. However, this is restricted by section 62 of the Charities Act 2011 (“section

62”). Section 62 explains the circumstances in which the original purposes of a

charity can be altered to allow the property to be applied for a different purpose. This

2 These were originally set out in a Community Benefits Statement in the ‘section106 agreement’ between the Council and the developer, made under section 106 of the Town and Country Planning Act 1990 and setting out the principles for community use.

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is because the trustee is not acquiring an alternative property for carrying out the

same charitable activities set out in the 1893 deed.

3.3 To alter the charity’s purpose, the court or the Commission must make what is known

as a “cy-près scheme”. “Cy-près” means “as near as possible” and a cy-près

Scheme is a legal arrangement that allows charitable property to be applied for

charitable purposes which are similar to the original purpose(s). Such a Scheme can

only be made in the circumstances set out in section 62.

3.4 If the trustees of a charity’s consider that their charity’s property requires to be

applied cy-près, they are under a legal duty to apply to the Commission (or the court)

for a Scheme under section 61 of the 2011 Act.

3.5 The Commission must be certain that one or more of the circumstances set out in

section 62 apply and that therefore a cy-près occasion has arisen. Only then can it

proceed to make a Scheme.

3.6 When making a cy-près Scheme, the Commission can provide for the charity’s

property to be applied for such charitable purposes as it considers appropriate, but it

must have regard to the matters set out in subsection 67(3) of the 2011 Act. These

are:

(a) the spirit of the original gift;

(b) the desirability of securing that the property is applied for charitable purposes

which are close to the original purposes; and

(c) the need for the relevant charity to have purposes which are suitable and effective

in the light of current social and economic circumstances.

3.7 To be clear, if a cy-près Scheme authorises the disposal of designated land, section

67 does not require it to be replaced.

3.8 In this case, the Commission has accepted the trustee’s argument that a cy-près

occasion has arisen under s62(e)(iii) – “Where the original purposes, in whole or in

part, have, since they were laid down ceased in any other way to provide a suitable

and effective method of using the property available by virtue of the gift, regard being

had to the appropriate considerations”. The “appropriate consideration” means:

(a) (on the one hand) the spirit of the gift concerned, and

(b) (on the other) the social and economic circumstances prevailing at the time of the

proposed alteration of the original purposes.

3.9 The Scheme in draft provides for a new charitable purpose and authorises the land

transactions explained above.

3.10 Even if a cy-près Scheme was not required, the Commission would need to authorise

the arrangements whereby the Council in its corporate capacity is (indirectly)

swapping the Prince’s Hall for the Queen’s Hall. This is because of the Council’s

conflict of interest.

4. Decision 4.1 The object of the Charity

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4.1.1 I consider that the existing primary object of the charity is to provide facilities for recreational and other leisure-time occupation by members of the public in Ealing and its neighbourhood in the interests of social welfare.

4.1.2 Whilst it is clear that the original purpose of the charity was for the Victoria Hall to be

used for the purpose set out in the 1893 deed so long as it continued to exist, this does not mean that the provision and maintenance of the Victoria Hall is part of the charity’s purpose. Whilst maintaining the Victoria Hall in a suitable condition to enable it to be used by the community is implied in the purpose, this does not extend to preserving it. A community building could be provided on other land in Ealing.

4.1.3 It has been argued by those opposed to the proposals that the preservation of the

Victoria Hall is integral to the purpose of the charity. The Commission has been referred to a case in the Court of Appeal3. This referred to the situation where “the qualities of the property which is the subject matter of the gift are themselves the factors which make the purposes of the gift charitable”. In the judgement, Dillon LJ gave examples of such property, including a trust to retain for the public benefit a particular building for its architectural merit.

4.1.4 It is true that the property is now historic and grade 2 listed. Many of the

representations in respect of the Scheme refer to the importance of preserving the Hall and it is clearly a much-loved building. Nevertheless, I do not think that the purpose of the trust included the preservation the building for the public benefit. I do not therefore accept the argument that the preservation of the Victoria Hall is integral to the purpose of the Charity.

4.2 Whether a cy-près occasion has occurred 4.2.1 As mentioned above, the Trustee considers that a cy-près occasion has arisen under

s62(e)(iii). It considers that the Charity is not self-sufficient and the Council in its corporate capacity cannot continue to subsidise the running and maintenance of the Halls.

4.2.2 As the Commission’s guidance makes clear4, “the circumstances which permit a cy-

press application of a charity’s property are not restricted to ‘failure’ and therefore the

trustees do not necessarily have to demonstrate that the charity’s purposes are

incapable of being carried out or wholly impracticable, particularly when current

social and economic circumstances are also taken into account”.

4.2.3 The charity does not have an endowment fund or income producing property and

therefore the cost of providing and maintaining the Halls must be met from letting fees, supplemented where possible by grants or other fundraising. This will include (1) day-to-day running costs, such as administration and cleaning, (2) regular routine maintenance, (3) cyclical maintenance, such as periodic re-painting and the replacing of furniture and fittings and (4) extraordinary maintenance to extend the life of the building, such as in replacing the roof or providing disabled access. Given this is an historic building, it is inevitable that costly repairs will be required in the future. Over previous years, the Council has paid all of the costs out of its corporate funds. Whilst the Council is to be criticised for not preparing separate charity accounts to provide evidence of its subsidies, it seems likely that the Council has significantly subsidised the maintenance and operation of the facility, particularly in respect of major

3 Oldham BC v Attorney-General [1993] Ch 210 at 219B 4 Operational Guidance OG 62 Application of property cy-près at 1.2.

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renovations, over many years. Now that the Council is aware that the property is owned by a charity and given the council’s finances, this kind of support will not continue in the future. I have not seen any evidence that the Halls could be self-sustaining.

4.2.4 Even if the Charity’s property was removed from the proposed re-development of the

Town Hall, the rest of the building (other than that sub-let to the Council) will be

operated by a commercial company. The Charity would not therefore be able to rely

on the Council to provide on-site services. Further the main entrance to the Victoria

Hall is via the staircase in the Town Hall, which may not be available for use. Whilst

the Friends claim that the Charity is likely to have an easement through the Town

Hall building, there is no evidence of this. Any works required to provide alternative

access and make the charity self-sustaining from the rest of the building would have

to be at the Charity’s expense and it does not have funds available for this purpose.

4.2.5 The Council argues that the trust property is effectively ‘landlocked’ because it was

built as an integral part of the construction of that wing of the Town Hall complex. It

says that most of the ancillary facilities needed to deliver some of its activities

(kitchens, storage, bar area, cloakroom, toilets, lifts etc.) sit within the Council’s

(statutory) footprint – although the Friends claim that the toilets are part of the

Charity’s property. It also claims that the restricted independent access to the trust

property mentioned above would not meet required standards.

4.2.6 I also think it questionable as to whether the Victoria and Prince’s Halls continue to

provide facilities that are “suitable and effective in the light of current social and

economic circumstances”. I note, for instance, that the Victoria Hall is described on

the Council’s website as a “grand Gothic Revival style hall” suitable for dining events

and dances. It is not a charitable purpose to provide facilities for corporate

conferences and other events and private parties – although they could be

accommodated at times when use for charitable purposes is not required to raise

funds for the charity. Although the Commission has no expertise in the provision of

community facilities, it seems reasonable that a property provided in Victorian times

is not necessarily going to meet the diverse recreational needs of the Ealing public in

the modern age.

4.2.7 I therefore consider that the circumstances provided for in s.62(1)(e)(iii) of the

Charities Act 2011 exist. I agree that a Scheme can be made which would authorise

the disposal of the Victoria and Prince’s Halls, but only if the property realised can be

applied for charitable purposes that are more suitable and effective than the original

purposes, regard being had to the matters in s67(3). I deal with this below.

4.3 Applying the property cy-près

4.3.1 As mentioned at 3.6 above, the Commission must, in deciding how the property

should be applied, have regard to the matters set out in section 67(3).

4.3.2 The Commission must firstly have regard to the spirit of the original gift. I have

concluded that the spirit of the gift is the provision of facilities for recreation and other

leisure time occupation in the interest of social welfare for the public of Ealing and its

neighbourhood.

4.3.3 Secondly, the Commission must have regard to the desirability of securing that the

property is applied for charitable purposes which are close to the original purposes.

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The original purpose was the provision of facilities in Ealing for the purposes set out

in the 1893 deed. I do not consider that this has to be in the Victoria and Prince’s

Halls, but suitable facilities should be available somewhere in Ealing.

4.3.4 Thirdly, it is necessary to consider whether the purposes are suitable and effective in

the light of current social and economic circumstances. In doing so, it is necessary to

consider changes since the time that the Halls were built. It is evident from the

charity register that there is a continuing need to provide facilities for recreation and

leisure time occupation in the interest of social welfare. In respect of this Charity,

relevant factors include:

• What demand is there in the area for recreational/leisure time facilities?

• What kind of facilities are required in the modern day?

• Would the refurbished facilities in the Town Hall building adequately meet current

needs?

• Are there individuals/groups who need facilities, but not of the type that will be

provided by the refurbished halls?

4.3.5 I cannot see that any thought has been given to what provision should be made in

Ealing in current social and economic circumstances and whether the present

proposals meet public needs. Importantly, I have not seen any proposals for using

the premium that the Charity will receive from the disposal and the annual rent. The

premium will be permanent endowment and must be retained, either by acquiring

new facilities or by being invested to produce an income.

4.3.6 As at 4.2.7 above, I agreed that the cy-près occasion has arisen on the basis that the

property no longer provides a “suitable and effective method of using the property”.

Therefore, the Commission needs to consider whether the changes facilitated by the

Scheme will provide a more suitable and effective method of using the property.

4.3.7 Factors that would make the use of the property following the making of the Scheme

more suitable and effective in meeting the charitable purpose include the following:

(a) The Charity is relieved of the financial burden of the upkeep and maintenance

of the Victoria Hall; this will in future be the responsibility of the Company. It

will also be under a duty to renew and replace fixtures and fittings as

necessary.

(b) The Victoria Hall will be renovated at the expense of the Company.

(c) The Charity will still have access to the refurbished Victoria Hall for use by

qualifying community groups at preferential rates on (potentially) 355 days a

year.

(d) A working group will be established, which may co-opt members from the

community, to monitor and review the use of the Victoria Hall in accordance

with the Scheme.

(e) The Charity will obtain a sub-lease in the Victoria Hall and a sub-sub lease in

the Queens Hall.

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4.3.8 Factors that make the use of the property less suitable and effective in meeting the

charitable purpose include the following:

(a) A 250-year lease is realistically a permanent disposition of the property. The charity will therefore no longer have any freehold designated land and will not have full control over the use of the property that it receives under sub-leases.

(b) I cannot see that any consideration has been given as to whether the

proposals are the best that can be obtained for the Charity - the terms of the disposal were agreed by the Council in its corporate capacity before it realised that the Halls are held on charitable trust. The report and valuation prepared by for the Council by Sanderson Weatherall dated 9 September 2019 does not do this, having been prepared on the basis of the proposed transaction. Although the proposals were considered by the General Purposes Committee acting as trustee in September 2019, it consists entirely of members of the Council and is inherently conflicted.

(c) Under the protocol, it will be the operator of the hotel who decides who can

hire the facilities - not the Trustee. This could be detrimental to the Charity, particularly as the operator does not have to give priority to community use and there are no reserved times for community use. Given that hirers would access the facility through the hotel and use its facilities, the hotel may be reluctant to let the facility to certain groups that it did not want on its premises or prioritise use by one of its customers over community use. Further, the operator will have no incentive to encourage community use and potentially could discourage it. It is possible that certain community groups may be reluctant to hire facilities in, what I understand will be, a boutique hotel.

(c) If, despite the covenants, the hotel operator refused to let the hall to

community groups, it is not clear how this could be enforced. Whilst it would seem to fall to the Council in its corporate capacity as landlord to enforce the community use, it may have no incentive to do so. The council as trustee would not have any funds to take legal action and it seems unlikely that the Council as trustee would act against the Council as landlord to enforce the community use.

(d) The Halls will only be available for hire by, basically, registered charities and

non-profit community groups with the majority of their members resident in Ealing. Whilst this may be a convenient way for the hotel to check whether a group is entitled to the reduced charges, this would potentially preclude other users.

(e) The income from letting the Victoria Hall will go to the private company,

Surejogi. Whilst it will bear all of the costs of making the property available, any ‘profit’ will stay with the Company and will not be available for application for the secondary purpose.

(f) The refurbished Victoria Hall will no doubt provide function room facilities

appropriate to a boutique hotel. Whilst this may be suitable for use for

events such as a charity dinner dance fundraising event, it may not

necessarily be the most suitable type of venue for recreational and leisure

time use in the modern day. I have not seen any analysis of this.

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(g) Although one of the benefits of the transaction has been presented by the

Council as being the preservation of the Victoria Hall, this is not an object of

the Charity.

(h) The ‘swap’ of the Smaller Queens Hall for the Princes Hall will take place

before the transaction with the Company is completed. Since the

apportionment of the premium and rent will be on the basis of floor space, this

means that that the Charity will receive a reduced premium and rent to what it

might have been entitled if the swap had not taken place.

4.3.9 Many making representations do not consider that the Queens Hall is a suitable

replacement for the larger Prince’s Hall with its split levels. However, I have not seen

any assessment of which of the Halls provides the type of facility and space that best

meets the needs of the public for recreational and leisure time occupation. Although

I am in no doubt that the ‘swap’ is as a result of the Company wanting to convert the

Prince’s Hall into a hotel gym and swimming pool, I consider this to be a neutral

factor since size is not the only criterion to consider.

4.4 The terms of the Scheme

4.4.1 I have considered the following in relation to the Commission’s Scheme as drafted:

(a) There should be provisions relating to the premium and for applying the future

income of the charity. It needs to be clear that the premium will constitute

permanent endowment and must either (1) be used to provide a replacement

property or other facilities in furtherance of the object or (2) invested to

produce an income.

(b) There should be an obligation on the Trustee to appropriate the Queen’s Hall for the purpose of the Charity. Although the Charity will only have a limited interest in this property under the sub-sub lease, this will still constitute permanent endowment and this should be reflected in the Scheme.

(c) There should be a mechanism for manging conflicts of interest which may

arise between the Council and the Charity. Given that all members of the

General Purposes Committee could be conflicted, there needs to be an

arrangement whereby there are independent co-optees to form a quorum

where the elected councillors have, or may have, a conflict of interest.

4.5. Conclusion

4.5.1 As mentioned at 4.2.7 above, I consider that the circumstances provided for in

s.62(1)(e)(iii) of the Charities Act 2011 exist. I therefore agree that a Scheme can be

made to authorise the disposal of the Victoria and Prince’s Halls, but only if the

property realised can be applied for charitable purposes that are more suitable and

effective than the original purposes, regard being had to the matters in s67(3).

4.5.2 Having considered the proposals, I have concluded that the Scheme as drafted and

the proposals negotiated by the Trustee for the future use of the Charity’s property

cannot be said to be a more suitable and effective use of the property than the

original purposes and create a significant risk to the trust property.

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4.5.3 I therefore consider that the Trustee should be given the opportunity to re-consider

how the Charity’s property, if the Halls are disposed of, can be put to more suitable

and effective use for the purposes of the Charity. In particular, further thought needs

to be given to the following:

(a) The extent of the charity’s property

It is important to ensure that the Charity is receiving the right proportion of the

sale premium and annual income in relation to its floor area. Consideration

should also be given as to why the Charity is potentially losing out in terms of

the premium that it will receive as a result of the swap of halls, which is being

made for the Council’s convenience as a result of the deal it negotiated.

(b) The needs of the public in Ealing

Consideration should to be given to the public’s need for facilities for

recreation or other leisure-time occupation, having regard to current social

and economic circumstances and the type of facility required to meet those

needs. For instance, a study could be commissioned from relevant experts to

provide this information. This could include consideration of the extent that

the renovated Victoria Hall and the Queen’s Hall will provide suitable facilities

for recreational and leisure time occupation and the type of use that might be

made of them.

(c) Use of the premium

The Commission needs clarity about how the Trustee proposes to use the

premium, in the light of any study commissioned as above and for what

purpose the interest from its investment and its share of the rent will be used.

For instance, whether a new property should be purchased for use for the

objects, such as a community hall in an area of Ealing without any such

facilities.

(d) The Charity’s future use of the Victoria Hall

Thought needs to be given as to how the community protocol can be

strengthened to ensure the hotel will be obliged to let the facilities for

community use, how this will be monitored by the proposed committee and

how it would be enforced.

(e) Managing conflicts of interest

Procedures need to be implemented to manage the conflict of interest which

may arise between the Council and the Charity.

4.5.4 If the trustee wishes to continue with its cy pre application, it needs to present the

Commission with a revised case that demonstrates that the proposals now amount to

a more suitable and effective use for the Charity’s property. Subject to consideration

of this, and having regard to the matters in section 67(3) of the 2011 Act, I consider

that the existing draft Scheme can be modified and made. I also consider that, if this

is done within one calendar year, the notice already given will be sufficient for the

purpose of section 88 of the 2011 Act and no further notice will be required.

However, those making representations would need to be notified that the Scheme

was being made since they should be aware of the ability to appeal to the First-tier

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Tribunal (Charity). If, on the other hand, the Trustee decides not to revise its case,

the Scheme can be withdrawn.

4.5.5 I have considered whether, under s.70(8) of the Charities Act 2011, the Scheme is so

contentious in character that it would be more fit for the case to be adjudicated on by

the court. Whilst there is opposition to the proposals, particularly by those opposed

to the disposal of the Victoria Hall, I do not consider making the Scheme itself to be

contentious.

4.5.6 As mentioned at 4.5.4 above, those opposed to the Scheme, if made, may be able to challenge the decision in the Tribunal by persons entitled to appeal. More information is available on the Tribunal's website:

http://www.justice.gov.uk/guidance/courts-and-tribunals/tribunals/charity/appeals.htm

Further information should be provided to those who made representations if a Scheme is subsequently made. Neil Robertson

3rd April 2020

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Reference Number: Case Number: C-482933

1

THE CHARITY COMMISSION FOR ENGLAND AND WALES

Under the power given in the Charities Act 2011

Orders that from today, the

this

SCHEME

will govern the charity

known as

THE VICTORIA HALL TRUST

at

Ealing, London

A member of staff of the Charity Commission authorised to act on behalf of the Charity Commission

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SCHEME

1. Definitions:

In this scheme:

“the beneficiaries” means the inhabitants of Ealing and the surrounding area.

"the charity" means the charity identified at the beginning of this scheme.

“Ealing Town Hall” means all the land and buildings at Ealing Town Hall New Broadway Ealing London W5 2BY registered at HM Land Registry with title number AGL135666.

“Mastcraft” means Mastcraft Limited (company number 01845796) whose registered address is at 30 Poland Street, London, W1F 8QS.

“Surejogi” means Surejogi Ealing Town Hall Limited (company number 10648824) whose registered address is at 30 Poland Street, London, W1F 8QS.

“the former trusts” means the Deed of Trust dated 6th November 1893.

“the Commission” means the Charity Commission for England and Wales.

ADMINISTRATION

2. Administration

The charity is to be administered in accordance with this scheme. This scheme replaces the former trusts of the charity.

OBJECTS OF THE CHARITY

3. Objects of the charity

The objects of the charity are

(1) To promote the benefit of the beneficiaries by the provision of facilities for recreation or other leisure time occupation of individuals who have need of such facilities by reason of their youth, age, infirmity or disablement, financial hardship or social and economic circumstances or for the public at large in the interests of social welfare and with the object of improving the condition of life of the beneficiaries.

(2) Subject to clause 4 of this scheme, the property listed in part 1 of the schedule to this scheme must be retained by the charity for use for the object at sub-clause (1).

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(3) If and insofar as the income of the charity cannot be applied towards the object above, it may be applied in furthering general charitable purposes for benefit of the beneficiaries.

POWERS

4. Powers of the trustee

In addition to any other powers which it has, the trustee may exercise the following powers in furtherance of the objects of the charity:

(1) Subject to the requirements of part 7 of the Charities Act 2011, the trustee may lease the land identified in Part 1 of the schedule to this scheme to Surejogi (in furtherance of clause 3(1) of this scheme) provided that the lease is on the terms identified in Part 2 of the schedule.

(2) The trustee may within six months from the date of this scheme enter into an exchange of the land set out in part 3 of the schedule to this scheme with the land set out in part 4 of the schedule to this scheme provided the trustee is satisfied that the terms of the exchange are in the interests of the charity.

TRUSTEE

5. Trustee

Ealing Borough Council is the trustee of the charity.

GENERAL PROVISIONS

6. Questions relating to the Scheme

The Commission may decide any question put to it concerning:

(1) the interpretation of this scheme; or

(2) the propriety or validity of anything done or intended to be done under it.

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SCHEDULE

PART 1

Land Land Registry title number

Part of Ealing Town Hall known as the Victoria Hall, shown edged and hatched red on the plan at Annex 1 to this scheme.

Part of title number AGL135666

PART 2

Required provisions for lease to Surejogi in respect of Ealing Town Hall (under which the Victoria Hall and Queen’s Hall will be demised, together with the rest of the building)

Length of lease for Victoria Hall

250 years

Premium for Victoria Hall

£2,500,551.00 (two million five hundred thousand five hundred and fifty one pounds) (exclusive of VAT) in respect of the whole Ealing Town Hall building.

The charity will obtain a receipt by way of a proportion of the Premium and rent payments consistent with the valuation obtained by the trustee in accordance with s119 of the Charities Act 2011in respect of the Victoria Hall (and Queen’s Hall).

Community use requirement for Victoria Hall

The lease will place a user covenant on Surejogi which will prohibit it from using the Victoria Hall other than in accordance with the objects set out in clause 3 of this scheme.

This use of the Victoria Hall (as well as the Queen’s Hall and other areas within Ealing Town Hall designated for community use) will be governed by the terms of a ‘Community Use Protocol’ contained in the lease.

The charity, Surejogi and Ealing Borough Council will be party to the Community Use Protocol, under which:

• they will establish a working group (which may co-opt members from the community) to monitor and review the use of the Victoria Hall in accordance with this scheme;

• the Victoria Hall will be available for community use bookings for up to 355 days in each year of the lease term (with guaranteed reserved hours for such bookings per day);

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• qualifying community groups will be able to book the Victoria Hall for community uses at reasonable and affordable rates (with provision for multiple booking discounts). These rates will be reviewed by the parties after an initial 10 year period, to ensure that they are still affordable for community groups.

Reserved use for Council’s statutory purposes of Victoria Hall

There will be 10 days reserved in each year of the lease term during which Ealing Borough Council (in its capacity as landlord) will have the right to use the Victoria Hall free of charge to carry out its statutory functions (e.g. for election purposes).

Ealing Borough Council will notify Surejogi in advance of the dates on which it intends to use the Victoria Hall for such purposes. The parties will be required to keep each other informed in relation to proposed bookings of the Victoria Hall on the Council’s nominated days, and will work co-operatively to resolve any conflicting bookings of the Victoria Hall.

Apart from during the 10 reserved days referred to above, the use of the Victoria Hall will be governed by the Community Use Protocol.

Repair and maintenance obligations for Victoria Hall

Surejogi will be required to:

• keep the Victoria Hall in good and substantial repair and condition;

• renew and replace from time to time all landlord’s fixtures and fittings at the Victoria Hall which may become beyond repair at any time during the lease term.

Parties to the lease • Ealing Borough Council (Landlord) of the first part;

• The Victoria Hall Trust (Trust) of the second part;

• Surejogi Ealing Town Hall Limited (Tenant) of the third part; and

• Mastcraft Limited (Guarantor) of the fourth part.

Note: the Commission authorises Ealing Borough Council in its capacity as the registered proprietor of the freehold to Ealing Town Hall, as one party (separate from, and in parallel to its capacity as trustee of the charity) to enter a single lease of Ealing Town Hall, including both those parts of the premises that are not held on charitable trust, and the Victoria Hall and Queen’s Hall, provided that the terms stated above must be included in the lease in respect of the charity’s property.

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PART 3


Part of Ealing Town Hall known as the Prince’s Hall, shown edged black on the plan at Annex 2 to this scheme.


PART 4


Part of Ealing Town Hall known as the Queen’s Hall, shown cross-hatched black on the plan at Annex 2 to this scheme.


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Annex 1: Victoria Hall Plan

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Annex 2: Prince’s Hall and Queen’s Hall Plan

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T

PP

DD

DD

D D P P P P T

DD

Business Services GroupProperty Services

Business Services Group, Property Services

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Schedule 2

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Part 1. Community Use Covenants

The covenants and other obligations set out below in the Community Use Provisions

Community Use Provisions

1. Introduction

These provisions govern the basis on which the Property shall, after the Practical Completion Date, be made available for Community Use, the eligibility criteria for such use, and the basis for charging for such use. These provisions may only be varied

or amended by written agreement between the Landlord, the Tenant and the Trust.

2. Definitions

Additional Community

Roomsmeans:

(a) the Nelson and Telfer Rooms; and(b) private dining, hospitality and meeting rooms;

Commercial Use

Community Use

Community Use Areas

Community Use

Eligibility Criteria

which are owned freehold by the Landlord and identified on

the Community Use Areas Plans in this Schedule 2 on a floor by floor basis, as may be revised from time to time with the

prior consent of the Landlord and the Trust

means any use which is not Community Use

means:

(a) use of a Community Use Area by a Qualifying

Community Group; and(b) use of the Trust Property in accordance with the

charitable objects of the Trust;

subject to any User Restrictions as may be agreed with

the Landlord and Trust from time to time in accordance

with Paragraph 4.6

means :

(a) the Trust Property; and(b) the Additional Community Rooms

means bodies which are either -

(i) subject to Paragraph 4.3, a registered charity providing

services to residents to, and based wholly or predominantly

in, the Borough of Ealing; or

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Community Use Periods

Community Use Rates

Community Use Working

Group:

Multiple Booking

Discount

Practical Completion

Date

(ii) a Community Group within the meaning of Paragraph 4.2.

means the periods described in Paragraph 6

means the rates set out in Table 1

means the group established pursuant to Paragraph 3 as a

forum for review of the operation of these Community Use

Provisions

means the discount on the Community Use Rate referred to in

Table 2

shall have the same meaning as defined in Schedule 2 to the

Agreement for Lease

Qualifying Community

Group

Trust Property

means any organisation meeting the Community Use Eligibility

Criteria, or a school or college operating in the Borough of Ealing (not for profit)

means:

(a) the Victoria Hall; and(b) the Queen’s Hall

User Restrictions

which are held by the Landlord (as freehold owner) in its

capacity as sole trustee for the Trust and identified on the

Community Use Areas Plans in this Schedule 2

means such reasonable restrictions on the types of use to be

permitted in the Property having regard to the needs of other users, the building, and other factors, consistent with

encouraging Community Use, as may be agreed pursuant to

Paragraph 4.6

3. Community Use Working Group

3.1 The Tenant, Landlord and Trust shall establish a working group comprising 4

representatives of each party for the purposes of monitoring and reviewing the

operation of these Community Use Provisions. The Community Use Working Group

may co-opt members from the community and generally regulate its business (including attendance) as it sees fit, consistent with the purposes of the

Community Use Working Group.

3.2 The purposes of the Community Use Working Group shall be -

3.2.1 to consider and comment on the Tenant’s policies or procedures relating to the

administration of Bookings (including any User Restrictions);

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3.2.2 to generally act as a Forum for discussion between the Parties, and with the

community, regarding Community Use

3.3 The Community Use Working Group shall meet not less than quarterly in the first two years following the date of this Lease and not less than every six (6) months

following the date falling two (2) years after the Practical Completion Date.

3.4 Without prejudice to Paragraph 3.2, in the period prior to the Practical Completion

Date, and during the Term, the Community Use Working Group may consider and

recommend means by which the Parties, acting jointly, shall enable future use of the Property for Community Use, including by organisations currently using the

Property.

4. Organisations able to use the Property for Community Use

4.1 The Tenant shall, in accordance with the Community Use Covenant, provide for Qualifying Community Groups to be able to make bookings for Community Use

during Community Use Periods at the Community Use Rates, under and in

accordance with these Community Use Provisions.

4.2 A body shall be a Qualifying Community Group provided that -

4.2.1 it is based wholly or mainly in the Borough of Ealing (evidenced by means of its

invoice address); and

4.2.2 in the case of an organisation not being a registered charity -

(i) at least 60% of its membership lives in the Borough of Ealing evidenced (a)in the case of an existing community group by means of its membership

list showing details only of the first part of the postcode and the first number of the second part of the postcode for all members, and (b) in

the case of a new community group by means of details of how the

community group intends to promote itself to residents of the Borough

of Ealing, together with production of a membership list in accordance

with (a) by no later than six months after being established;

(ii) the constitution/terms of reference/aims of the community group muststate that a key aim/purpose is to provide a service to residents of the

Borough of Ealing; and

(iii) it operates as a non-profit making organisation;

4.3 In the case of a registered charity the Tenant shall seek proof of status by requiring

the organisation to provide its registered charity number for verification on headed

paper.

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4.4 In the event of any uncertainty or dispute regarding whether an organisation meets

the Community Use Eligibility Criteria, the Tenant shall seek advice from the Head

of Hospitality 8t Events (or equivalent) at Ealing Council and the Trust.

4.5 Where a booking has been made by an organisation not providing satisfactory

evidence of being a Qualifying Community Group within two weeks of being

requested to do so, the Tenant may convert the booking from being for Community

Use to a Commercial Use (or may cancel the booking altogether and refund any

booking fee paid).

4.6 The Parties may from time to time discuss and agree reasonable User Restrictions

to ensure that the Property is used only for purposes appropriate for the Property, provided always these are fully consistent with suitable Community Use and are in

no way discriminatory or unlawful.

5. Management of Bookings

5.1 The Tenant shall manage all bookings for Community Use and Commercial Use, having regard to any booking policies or procedures notified to and discussed with

the Community Use Working Group, and any User Restrictions.

5.2 The bookings policies and procedures shall -

5.2.1 apply the Community Use Rate in respect of bookings for Community Use;

5.2.2 apply the Multiple Bookings Discount; and

5.2.3 provide for Qualifying Community Groups to make booking up to 12 months in

advance.

6. Community Use Periods

6.1 The Community Use Areas shall be available for Community Use during the

Community Use Periods shown in Table 1, as the same may be varied from time to

time with the agreement of the Landlord and the Trust.

6.2 Priority hire of the Community Use Areas during the Community Use Periods will be given to recurring users of the Community Use Areas by means of contacting

them sufficiently in advance to determine their future Community Use

requirements.

7. Community Use Areas

7.1 The agreed Community Use Areas shall be those shown edged red on theCommunity Use Areas Plans in this Schedule 2. Throughout the Term, unless agreed

by the Landlord and Trust, the Additional Community Rooms shall never be less than as shown in Table 3.

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7.2 Throughout the Term, the Tenant shall comply with its obligations under Clause 32

(Alterations) of the Lease.

8. Community Use Rates

8.1 The Community Use Rates shall be as set out in Table 1 (increased annually by the

Retail Price Index (RPI)), which the Parties agree reflect the upgraded Community

Use Areas by way of a 10% uplift.

8.2 The rates shown in Table 1 shall apply for a period of ten (10) years following the

re-opening of the Town Hall. In the period of twelve (12) months prior to the end

of year ten, the Landlord, Tenant and Trust shall review the Community Use

Provisions and the Community Use Rates, on the basis that Qualifying Community

Groups may continue to use the Property at rates which are affordable. For these

purposes it is agreed that “affordable” shall reflect the prevailing discount at that time and be based on benchmarking the new Community Use Rates at 60% of any

equivalent rate(s) charged by the Tenant for Commercial Use of the Community

Use Areas of the Property.

9. Community Use in relation to Promotion of Public Health

9.1 In addition to Community Use by Qualifying Community Groups, the Tenant shall apply the Community Use Rate to all bookings made in respect of Community Use

Areas by organisations providing dance and exercise classes where the organisation

can demonstrate that it is providing valuable services to the residents of the

Borough of Ealing and charging a fair price to individuals for the classes. The

Community Use Area for dance and exercise classes (the Telfer Room) will maintain

its wooden floors.

9.2 Any booking made under this Paragraph 9 shall be only in respect of Community

Use Areas (subject to Paragraph 9.3) during the periods Monday to Friday (9am - 10pm) and Saturday and Sunday (9am - 5pm), and provided that there is a

minimum booking period of two (2) hours on Mondays to Fridays, and of four (4) hours on Saturdays and Sundays.

9.3 The Victoria Hall will not be available under this Paragraph 9 after 5pm on Friday

or on Saturday or Sunday.

10. Records

10.1 The Tenant shall maintain records of all Community Use and these will be

reviewed quarterly for the first year and thereafter every 6 months by the

Community Use Working Group.

11. Transitional Arrangements

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Prior to the re-opening of the Property, the Tenant shall confirm to the Landlord and

the Trust its planned arrangements for bookings (and any associated notification to

current users of the Property) and shall take into account any comments made by the

Landlord and/or the Trust.

Table 1 - Community Use Periods and Community Use Rates

Note: Peak Hourly Rate means the rate charged by the Tenant as they determine from

time to time, unless shown otherwise.

Community Use

Hourly RateCommunity Use

Hourly RatePeak Hourly Rate

Community UsePeriod

Monday to Thursday. 9am to 12 am

(midnight)

Friday. 9am to 5pm

Friday. 5pm to 12am

(midnight)Saturday, Sunday, and Bank holidays

9am to 12am

(midnight)

Community Use Area

(a) Trust Property

Victoria Hall £127 n/a £402

Queen’s Hall £68 [TBC] £198

(b) Additional Community Rooms

Nelson Room £68 £68 £220

Telfer Room £68 £68 £198

Telfer Room (dance

and exercise classes

only)

£68

(£45 for youth

classes)

£68

(£45 for youth

classes)

£68

(£45 for youth

classes)

9am - 5pm only

Ground -Private

dining£30 £30 [£198]

Basement - Hospitality area

£110 £110 [£198]

Basement - meeting1

£30 £30 [£43]*

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Basement - meeting2

£26 £26 [£43]‘

Basement -meeting3

£26 £26 [£43]‘

Hospitality package -

(Limited to 1 per hirer per month in peak periods, booking

within 3 months of hire use)

Sat, Sun and & Bank

holidays 9am - 12am

Victoria Hall - Ealing

Town Hall10 hours room hire including

standard lighting scheme £1,925

‘Note: 6 hour minimum booking at peak times unless meeting room is to be used in

conjunction with Trust Property, Nelson Room or Telfer Room.

Table 2 -The Multiple Booking Discount

Bookings Made in One

Transaction within the

financial year (April - March)

DiscountApplicable

2-5 10%

6- 10 12.5%

11-20 15%

21 - 35 20%

35-50 50%

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Table 3 - Minimum Additional Community Room Areas

Floor - Room Sq.m Sq.ft

Basement - Hospitality Area 220 2,368

Basement - Meeting 1 Indicative 48 Indicative 517



NB These are indicative areas and the

requirement is for 3 rooms providing the

total area, configured to meet community

use needs, and v/ith an ability to move

partitions so that a larger space is available.

TOTAL 118 1,271

Ground - Telfer room 109 1,173

Ground - Private dining 44 474

First - Nelson room 103 1,109

First - Function room 38 409

TOTAL 632 6,804

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Community Use Areas Plans

(1) Trust Property

a. Victoria Hall (edged red)

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of 86

Part 2. Victoria Hall Covenants

1 The Tenant covenants with the Landlord and the Trust to make available to the

Landlord or such other person firm company or other organisation nominated by

the Landlord (Nominee) (and all persons authorised by the Landlord or any

Nominee) Victoria Hall and all necessary access and egress to and from Victoria

Hall along and over any part of the Property and to the use of toilet and washroom

and kitchen facilities within the Property reasonably required by the Landlord for such purpose for up to 10 full days per annum in each year of the term.

2 As soon as reasonably practicable prior to or after the commencement of each

year of the term (each year being the “Relevant Year”), the Landlord shall be

entitled to serve written notice upon the Tenant nominating up to 20 full days in

the Relevant Year on which it (or any Nominee) provisionally intends to use

Victoria Hall in accordance with paragraph 1. For the avoidance of doubt, if the

Landlord has nominated less than 20 days in accordance with paragraph 2 before

the commencement of any Relevant Year, the Landlord shall not be precluded

from serving further notice or notices on the Tenant during the course of that Relevant Year to nominate the balance of days available for nomination.

3 The Landlord shall be entitled to notify the Tenant of its nominations in

accordance with paragraph 2 by serving one or more written notices on the

Tenant, provided that the aggregate number of days nominated in those notices

does not exceed 20.

4 The Landlord shall confirm the dates of the 10 full days on which it (or any

Nominee) will use Victoria Hall in accordance with paragraph 1 on service of not less than three months’ written notice upon the Tenant in advance of each such

day, the 10 such days having previously been nominated by the Landlord in

accordance with paragraphs 2 and 3 of this Part 2 of Schedule 2.

5 The Tenant shall notify the Landlord in writing of any intention to accept a

booking or other arrangement for the Tenant or any other person to use the

Victoria Hall for any day part of a day or number of days that conflict or conflicts

with any day or days already nominated by the Landlord in accordance with the

procedure set out at paragraphs 2 and 3 of this Part 2 of Schedule 2 and shall not accept the same without the prior written consent of the Landlord (which shall be

deemed to have been given if no response is received within 5 Working Days of a

request for consent, save that the Landlord’s consent shall never be given or deemed to have been given to requests for bookings under this paragraph 5 that conflict with any confirmed bookings of Victoria Hall that have already been

notified by the Landlord to the Tenant in accordance with paragraph 4).

6 Without prejudice to the generality of the provisions of paragraphs 1 to 5

(inclusive) of this Schedule the Landlord and the Tenant shall act reasonably co-operate with each other and keep each other as informed as is reasonably

practicable as to their respective requirements for the use of the Victoria Hall from time to time and shall seek to resolve as amicably as possible any actual or potential conflict between their respective requirements. Without prejudice to

the generality of the foregoing the Landlord shall use reasonable endeavours to

notify the Tenant as soon as reasonably practicable prior to or after the beginning

of each year of the term of any dates likely to be required for such purpose or weeks in which those dates are likely to fall in the forthcoming or current year of

of 86

the term but shall not be bound by any such notification or to any dates or weeks

specified in that notification.

The use of Victoria Hall (and all facilities contained within the same, including but not limited to the furniture and audio visual equipment) pursuant to this Part 2 of Schedule 2 shall be free of charge to the Landlord and any Nominee.

For the avoidance of doubt in relation to any events held at Victoria Hall pursuant to this Part 2 of Schedule 2, the Landlord and any Nominee shall be entitled to:

8.1 provide its own food and/or drink and/or (subject to paragraph 9) appoint any external catering companies or other providers of food and/or drink (in

each case including but not limited to the provision of bar and catering staff and equipment) free of additional charge to the Landlord (including corkage

charges), and including access to adequate kitchen facilities and such other suitable parts of the Property as the Landlord, Nominee and/or catering

company or provider may reasonably require for the finishing of food, to

cater for such numbers of guests as are permitted by the laws referred to in

clause 36.1.1 of this lease (which for the avoidance of doubt shall include

(without limitation) adequate access to running water, a plating/clearing

area and electrical connections for the operation of turbo ovens and hot cupboards); and/or

8.2 appoint the Tenant’s internal catering services for the provision of food

and/or drink (including but not limited to the provision of bar and catering

staff and equipment), the cost of the provision of such services to be

charged to the Landlord in accordance with published hotel catering rates

at the date of the relevant event subject to a discount to be agreed in

writing between the Landlord and Tenant, each acting reasonably, prior to

each relevant event;

and the Landlord shall confirm to the Tenant, on serving notice in accordance withparagraph 4, which of the catering arrangements (as specified at subparagraphs 8.1and 8.2 above) it will be using or intends to use.

The use of the kitchen facilities at the Property by the Landlord, its Nominee or any external catering companies or other providers of food and/or drink appointed

in accordance with paragraph 8.1 shall only be permitted if, on request, the

person or persons intending to use said kitchen facilities provide the Tenant with:

9.1 evidence of public liability insurance with a minimum cover of £5,000,000;

9.2 evidence of employer’s liability insurance with a minimum cover of £10,000,000;

9.3 food hygiene certificates (for all chefs that will be at the Property);

9.4 a Council Hygiene Star Rating Certificate;

9.5 a Risk Assessment and a Hazard Analysis Critical Control Point plan or plans; and

9.6 two satisfactory references in relation to catering services previously

provided for events at established conference and meeting venues.

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The Tenant, the Landlord and the Trust shall each observe perform and comply

with the provisions of the Community Use Covenants insofar as the same relate to

the Victoria Hall and are not inconsistent with paragraphs 1-5 (inclusive) of this

Part 2 Schedule 2.

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1

APPENDIX 4

Charity Commission Review April 2020 - Summary of issues, options and recommendations

CC Review Para Ref

Charity Commission Comment Factors and options Recommendation

The Extent of the Charity’s property

1. 4.5.3(a) It is important to ensure that the Charity is receiving the right proportion of the sale premium and annual income in relation to its floor area. Consideration should also be given as to why the Charity is potentially losing out in terms of the premium that it will receive as a result of the swap of halls, which is being made for the Council’s convenience as a result of the deal it negotiated.

It is not the case that the Trust will potentially lose out in terms of premium and annual income by reason of the land swap based on floor areas. No decision has yet been taken as to what a fair apportionment is. On 26 September 2019 the Trustee resolved: to authorise officers of the Council, acting on their behalf, to settle the apportionment of the lease premium and rent paid by Mastcraft (as well as the fair and reasonable contribution to be made by the Trust towards the Council’s costs), in accordance with the advice received from the independent Valuer (and any further valuation advice required in that respect). As a result, whilst respective floor areas will be part of the considerations which are taken into account they will not exclusively determine what is the correct proportion of premium and rent that the Trust should receive. The independent valuation obtained by the Trust (which was attached as Appendix 4 to the 26 September report) noted that the respective floor areas for the halls which are proposed to be swapped are as follows Princes Hall: 370.8 sq.m (3,991 sq.ft)

Option a. The best interests of the Trust regarding the apportionment of premium and rent income will be protected by means of a negotiation between valuers instructed on behalf of the Trust and the Council respectively. Delaying a response to the Charity Commission is not recommended because of the need to resolve the Scheme and the limited time for doing so.

6

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2

Queens Hall: 214.0 sq.m (2,304 sq.ft Also, and contrary to what is assumed by the Charity Commission, the land swap of the Princes Hall with the Queen’s Hall was proposed for the benefit of the Trust rather than the Council. The Council’s original proposal was that there should be a land swap of the Princes Hall with other hire space within the hotel lease area. However following correspondence with the Charity Commission, it was agreed that the Princes Hall should be swapped for the Queen’s Hall instead. This was principally because the Queen’s Hall is within the ‘retained’ part of the Town Hall intended to be subleased back to the Council and therefore under the control of the Council not the hotel operator. This then enables the Council to give the Trust more control of the use of the space by means of a sub under lease from the Council. This is in the interests of the Trust rather than the Council which will now lose the control of the Queen’s Hall to the extent that it otherwise would have retained under the original proposal. With regard to the need for the Charity to receive the right proportion of the sale premium the identified options available to the Trust would be to: Options

a. Reaffirm the authorisation of 26 September 2019 quoted above

b. Delay a response to the Charity Commission until the details of the apportionment have been agreed

The needs of the public in Ealing

2. 4.5.3(b) Consideration should be given to the public’s need for facilities for recreation or other

In relation to meeting the needs of the public in Ealing, the Trustee may conclude that it would have arrived at the same

Option a

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3

leisure-time occupation, having regard to current social and economic circumstances and the type of facility required to meet those needs. For instance, a study could be commissioned from relevant experts to provide this information. This could include consideration of the extent that the renovated Victoria Hall and the Queen’s Hall will provide suitable facilities for recreational and leisure time occupation and the type of use that might be made of them.

overall conclusions as the Council with regard to the need for a facility, and the type of facility. There is no evidence that a different specification for community use would have been developed on the future use of the Trust property by the Trustee rather than by the Council had the distinction between the Council’s dual roles been known at the time of seeking proposals for the Town Hall. When the Council first considered redeveloping the Town Hall as a whole, it was one of the Council’s requirements that any redevelopment should cater for as much of the previous hirer activity as possible. The developer requirements and terms subsequently negotiated were also informed by information obtained from what community groups/hirers were requesting from other Council venues. The conclusion was that it did not appear that anything needed to be significantly changed to provide what the public wanted other than for the facilities themselves to be upgraded and modernised. This was supported on a review that the Council was undertaking of its community space provision, including Ealing Town Hall, and which did not identify any specific unmet need. In its Scrutiny Panel report dated 2016 it was noted that As of November 2015, there are now 52 organisations which use either Ealing Town Hall or Greenford Hall regularly. These comprise of a wide range of community activities from flower-arranging, religious groups, social networking, exercise and dance to children’s homework classes, blood donor sessions and arts groups. They also include public sector organisations such as National Blood Service and NHS / Ealing CCG.

A new assessment is highly unlikely to reveal any significant additional information about the demands for space for public recreation and leisure time occupations in the area, or reveal any material change in the social or economic factors that bear on that. Also, the time it is likely to take to carry out that assessment would be likely to put the current proposals at risk (bearing in mind that without redevelopment, the Trust would then be seeking to rely on continued financial support from the Council).

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4

In addition to this, a large number of community groups and charities use the facilities at both venues for regular adhoc, quarterly, bi-annual and annual events. Examples of these hirers include local pantomime shows, Met Police meetings, Ealing in Bloom awards, Jack Petchey Foundation, local schools’ awards ceremonies and annual community religious/cultural festivals. Finally, they host a huge volume of one-off events and meetings for community organisations and charities. This is considered to provide evidence of a continuing demand from the community for both large and small spaces. Nothing in the intervening period would suggest any change in this assessment. It has not been suggested by any objectors to the Town Hall proposal that the needs of the community would be better met by relocation of facilities to a new location. The objections rather tend to support the view that the public wish to continue using facilities within the Town Hall (and for the same general purposes). With regard to the need to reconsider the public’s need for facilities for recreation or other leisure-time occupation and whether the proposals meet this need, options available to the Trust would be to:

a. Accept that based on existing evidence the proposals meet the demands for space for public recreation and leisure time occupations in the area

b. Commission a new study to reassess demands for space for public recreation and leisure time occupations in the area

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3. 4.3.9 The Queen’s Hall Assessment of which of the halls [Queens and Prince’s] provides the type of facility and space that best meets the needs of the public for recreational and leisure time occupation.

Members are already very familiar with the current layout of the Princes Hall and Queen’s Hall. The Trust’s independent report and valuation by Sanderson Weatherall and considered by the Trust on 26 September 2019 confirms the following in relation to the proposed land swap:

• Queens Hall currently generates a higher level of gross income than Princes Hall, which would show a greater margin if expressed on a net basis

• Queens Hall is considered to be capable of maintaining higher occupancy than Princes Hall

• Following the proposed refurbishment, Queens Hall will represent a function space that is comparatively more flexible than Princes Hall

• Queens Hall is a size and configuration that we consider to be more suited to community use groups and workshops

One of the significant benefits of the land swap proposed is that the refurbished Queen’s Hall would be capable of being subdivided. The Princes Hall could not be sub-divided and the split levels prohibit flexibility for community use. The fact that the Princes Hall has historically attracted fewer bookings supports the Princes Hall being less suitable for the delivery of the Trust’s objects. With regard to undertaking a further assessment of which of the halls proposed to be swapped provides the type of facility and space that best meets the needs of the public for recreational and leisure time occupation, options available to the Trust would be to:

a. Reaffirm that it is accepted that a newly refurbished Queen’s Hall better meets the needs of the public

Option a Given that an independent property consultant acting for the Trust has already made an assessment it is not considered necessary to commission any further assessment particularly given the risk of the delay to the project that this may cause.

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for recreational and leisure time occupation than a refurbished Princes hall based on Sanderson Weatherall’s independent assessment.

b. Commission a further opinion from an expert to appraise the two spaces and their relative potential.

Use of the premium and rent

4. 4.5.3 (c) The Commission needs clarity about how the Trustee proposes to use the premium, in the light of any study commissioned as above and for what purpose the interest from its investment and its share of the rent will be used. For instance, whether a new property should be purchased for use for the objects, such as a community hall in an area of Ealing without any such facilities.

There are a number of options as to how any premium and income could be used. For example, the Trust could use money to support groups in other ways, reduce hire rates, support dance groups that require different facilities to find other locations/subsidise hiring of other venues. The total premium is £2.5m and it therefore clear that even with a generous apportionment as between the Council and the Trust the amount due to the Trust would not be sufficient to purchase another property. With regard to further clarifying at this time how the Trustee would propose to use any premium, options available to the Trust would be to:

a. To defer any decision as to how the premium and income might be used until the Scheme has been approved, but to give that active consideration once the Scheme is made and by means which are consistent with the objects of the Charity (as updated).

b. Consider and agree what use the premium and income would be put to before responding to the Charity Commission

Option a It would seem premature to recommend how the premium and income is to be applied on a Scheme that has yet to be adopted by the Charity Commission and, as noted elsewhere, would place the proposals at risk through further delay. The Trustee may however wish to confirm to the Charity Commission its clear intention to give that matter serious and proper consideration, including by way of a study into the needs in the area that might be met through use of the premium and rent.

The Charity’s future use of the Victoria Hall

5. 4.5.3 (d) Thought needs to be given as to how the community protocol can be strengthened to ensure the hotel will be obliged to let the

The Protocol (attached at Appendix 3) is already a comprehensive document and is part of the Lease with Mastcraft. It is enforceable as a lease covenant and

Option b

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facilities for community use, how this will be monitored by the proposed committee and how it would be enforced.

includes a mechanism for monitoring by means of the establishment of a Community Use Working Group to which independent members may be co-opted and which will meet at prescribed intervals. If despite this level of monitoring there are breaches of the Protocol by the Tenant then this may (depending on the nature of and extent the breach) amount to breach of the terms of the lease which would give rise to enforcement in the usual way. Options available to the Trust in relation to making further amendments to the Protocol include:

a. Make no further changes to the Protocol on the basis that it is contains clear and enforceable protections to the Trust

b. Require that arrangements are made with Mastcraft to further develop the Protocol. This could include:

• Adding a further provision to the Protocol requiring them as the hotel operator to prioritise community over commercial use e.g. by means of an advance booking system.

• A requirement to actively encourage/advertise the use of those areas for community purposes.

• The introduction of further monitoring requirements and an ability to ensure compliance with the Protocol by means of other steps prior to enforcement of the lease by way of legal action.

Although the Protocol as it stands is enforceable and comprehensive, the Council have confirmed that Mastcraft are amenable to the Protocol being developed to accommodate the matters referred to.

Managing conflicts of interest

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6. 4.5.3 (e) Procedures need to be implemented to manage the conflict of interest which may arise between the Council and the Charity.

There has already been correspondence with the Charity Commission about the potential for a conflict of interest between the Council and the Trust. Earlier guidance provided by the Charity Commission has been acknowledged and addressed by the Trust and the Council (as landowner) for some time. This issue was reviewed in detail by the Trustee at the meeting on 26 September 2019 and in its response to the minutes of that meeting the Charity Commission confirmed that: The reported decision of the Committee appeared to have complied with the Trustee's decision making responsibilities, and that the mechanism of the Committee making the decision sufficiently addresses the Council's conflict of interest in making a trustee decision (given its other interests in the Mastcraft proposal). With regard to implementing further procedures to manage any conflict of interest between the Trust and the Council, options available to the Trust are to:

a. Do nothing and reaffirm that existing procedures, which are consistent with earlier guidance from the Charity Commission, are in place to manage potential conflicts of interest

b. Reaffirm that existing procedures are in place to manage potential conflicts of interest, which are consistent with earlier guidance from the Charity Commission, but undertake to review those arrangements to see what additional procedures can be put in place going forward.

Option b The conflict of interest point has been very thoroughly considered and taken into account. Nevertheless, and in order to provide further assurance to the beneficiaries of the Trust going forward, the Trustees should give further though to these arrangements (including for example the co-option of external representatives as trustee(s)).

The section 67(3) issue – being the matters to be taken into account in relation to the disposal

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7. 4.5.1 ……a Scheme can be made to authorise the disposal of the Victoria and Prince’s Halls, but only if the property realised can be applied for charitable purposes that are more suitable and effective than the original purposes, regard being had to the matters in s67(3) namely

7a (a) the spirit of the original gift, The Charity Commission are of the view that this is ‘the provision of facilities for recreation and other leisure time occupation in the interest of social welfare for the public of Ealing and its neighbourhood’

Taking into account the way in which the Trust operated historically it is arguable that the Charity Commission’s view is not an entirely accurate reflection of how the Trust was intended to and did operate in its early years and beyond. It is clear from the minutes of Trust meetings and Trust accounts that from its inception the Trust functioned by hiring Halls for recreational and leisure purposes as well as municipal ones and (in the early decades at least) also created surplus income which was applied elsewhere in the borough. For example, and as previously reported, minutes record that in 1937 surplus income was being applied to pay the rent for elderly residents living in ‘Coronation Cottages’. This ended when the cottages were demolished. Later minutes also confirm that the ‘deemed rent’ paid by the Council to the Trust from the 1930s onwards was latterly applied to the Mayor’s Fund to be applied for whatever charitable purpose was nominated by the Mayor from year to year. In summary any surplus received by the Trust has always been applied for wider charitable purposes and has not been limited to recreation and leisure purposes only, albeit that the availability of the Halls being for hire for recreational and leisure purposes (and a source of income) was also very much a key part of its objects.

Option a Given that the proposal will both secure the availability of premises for recreational and leisure purposes and is likely to create surplus income for the Trust (and which may then be applied for compatible purposes) it would appear that this requirement has been met.

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The Trust needs to be satisfied that the current Scheme meets the requirement that the proposal in is the spirt of the original gift. In relation to amending the proposals to reflect the views of the Charity Commission, options available to the Trust would be:

a. To agree that the proposals are in the spirit of the original gift

b. To reconsider what future (viable) proposals could be considered to be in the spirit of the original gift

7b (b) the desirability of securing that the property is applied for charitable purposes which are close to the original purposes

The Charity Commission confirm that they consider these to be facilities that can be provided in Ealing generally i.e. not necessarily in the Victoria Hall or Prince’s Hall.

When the Council first considered the options for the redevelopment of the Town Hall, it sought to ensure that the existing recreational and leisure occupation facilities made available to the public in the Town Hall (including the Victoria Hall and Princes Hall) would be protected and would continue to be provided as a minimum. It is now suggested by the Charity Commission for the first time that the Trust consider whether it might be in the best interests of the Trust to dispose of the Victoria Hall and Princes Hall altogether presumably with a view to obtaining a capital receipt which it can then apply for charitable purposes which are close to the original purposes. This is likely (although not inevitably) to involve the Trust needing to invest in other premises in Ealing. It is not clear how this could be funded bearing in mind that the Halls have been subsidised by the Council since the 1930s and it is therefore unlikely that the disposal of the property

Option a Any outright disposal of the Trust Property pre-supposes that the resultant receipt would enable the Trust to acquire new property which is better suited to meeting the Trust’s objects, and that there would be a willing buyer. Neither assumption is supportable. Even if the Council disposed of the Town Hall without any retained community use, it is unlikely that the resulting share of premium obtained by the Trust would be sufficient to fund such new premises. Also, it is abundantly clear that the beneficiaries want

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would achieve sufficient capital receipt to enable the Trust to invest in other property. It is also still possible for the Trust to apply its share of premium and rent income in support of ‘additional facilities for recreation and other leisure time occupation in the interest of social welfare for the public of Ealing and it neighbourhood’ e.g. by subsidising groups wishing to hire other types of facilities in the event that the Victoria Hall and Queens Hall are not suitable for any reason. This also links to the points raised in section 9 below. In relation to the Trust exploring whether there are alternative routes to meeting the objects of the charity by securing alternative premises, options available to the Trust would be to:

a. Proceed with the disposal to Mastcraft as previously agreed

b. Review options for disposal of Victoria Hall and Princes Hall to secure a capital receipt to invest in other premises

the Trust to retain its current ability to provide facilities in the Town Hall.

7c c) the need for the relevant charity to have purposes which are suitable and effective in the light of current social and economic circumstances The Charity Commission consider a number of factors to be relevant to this including demand in the area for recreational/leisure time facilities, modern requirements for facilities, whether the Town Hall building adequately meets current needs and whether there are individuals or groups

The proposed new purposes of the Trust are set out in the draft Scheme and are summarised by the Charity Commission as the ‘provision of facilities for recreation and other leisure time occupation in the interest of social welfare for the public of Ealing and it neighbourhood’. It is considered that these purposes are suitable and effective in the light of current social and economic circumstances. It is also considered that the Town Hall building (especially following its refurbishment) will more than adequately meet current needs, as is borne out by

No decision is required, but the response to the Charity Commission will reference this factor.

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needing facilities which would not be met by the refurbished halls.

the consultation and other feedback in support of ongoing community use. However, it is acknowledged that the Charity Commission raise other relevant factors and these are therefore addressed as appropriate in this Table.

9 4.3.8 Factors that make the use of the property less suitable and effective in meeting the charitable purpose include the following:

9a. 4.3.8 (a) A 250-year lease is realistically a permanent disposition of the property. The charity will therefore no longer have any freehold designated land and will not have full control over the use of the property that it receives under sub-leases.

The charity will be granted an underlease of the Victoria Hall and sub-underlease of the Queen’s Hall, in each case for a term of just under 250 years. The charity will therefore gain an ‘effective freehold’ in the trust property under these leases, in the same way that Mastcraft will under its long leasehold interest in the rest the building. In the case of the Queen’s Hall it will be the Trust (not the hotel operator) who will have day to day control of the Queen’s Hall as this will be part of the Town Hall to be retained by the Council not the operator (albeit under a sublease). The Trust will therefore control the use of the Hall by means of the sub-under lease.

In addition to its rights with regard to the Queen’s Hall by the sub-under lease proposed the underlease of the Victoria Hall will provide the Trust with a level of control in the form of landlord covenants for Mastcraft to make the Trust property available for use in accordance with the Community Use Protocol. If Mastcraft does not comply (or in relation to the Queen’s Hall, the Council does not procure Mastcraft’s compliance), then the Trust will have the right to enforce these covenants.

Option b. This will assure the Charity Commission that the lease structure not only reflects the suggestions they made, but also deals with the underlying concern about “control”.

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This underlease structure was put in place in accordance with the Charity Commission’s own suggestion in its letter dated 15 July 2019 (by way of follow up to the Council and Trustee’s meeting with it on 10 July 2019). The Commission’s view then was that if the Trust retains an interest in the Trust property by way of the grant of an underlease, this would ‘strengthen the charity’s position over the medium and longer term’, as it would not be left ‘relying solely on enforcement of covenants’ under the headlease. The Council will also have rights under the headlease (in its capacity as landlord, together with the Trust) and the DRP underlease (in its capacity as tenant) to enforce the Community Use Protocol against Mastcraft. It is acknowledged that the Protocol doesn’t currently reflect the fact that the hotel operator will not be responsible for the hiring of the Queen’s Hall, but the Protocol can be amended to reflect this; again, Mastcraft are understood to be amenable to this. In relation to the issue of the loss of Freehold interest in the Trust property as raised by the Charity Commission, options available to the Trust would be to:

a. Confirm to the Charity Commission that the existing lease structure combined with the Community Use covenant, does in fact provide the charity with the “control” referred to;

b. Give that confirmation under a. but also confirm the amendment to the Protocol referred to (i.e. strengthened control of the Queen’s Hall).

(b) [the charity commission could not] see that any consideration has been given as to

The Trust is aware of the position from the details set out in the various reports it has received in the past few years. The

Option a.

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whether the proposals are the best that can be obtained for the Charity - the terms of the disposal were agreed by the Council in its corporate capacity before it realised that the Halls are held on charitable trust. The report and valuation prepared by for the Council by Sanderson Weatherall dated 9 September 2019 does not do this, having been prepared on the basis of the proposed transaction. Although the proposals were considered by the General Purposes Committee acting as trustee in September 2019, it consists entirely of members of the Council and is inherently conflicted.

independent report was prepared exclusively for the Trust and not the wider Council (who obtained their own separate valuation). The report was prepared in the knowledge that the Trust has been subsidised by the Council for decades in terms of the running of the Halls and that the Council can no longer continue to subsidise the Trust. With regard to the question of conflict of interest the members of the Committee are fully aware of their duties to the Trust rather than the Council and are receiving independent advice as a result. Every opportunity has been provided for the members of the Committee, when acting as the Trustee, to challenge and seek to reverse the approach being taken and the proposed transaction with Mastcraft. In relation to further considering whether the proposals are the best that can be obtained for the Trust, options available would either to

a) Confirm that the Trustee has evaluated all options, including whether to reverse out of the proposed transaction, and has done so with an independent mind acting in the interests of the Trust and its beneficiaries

b) undertake a further review of options for the Trust property

Whilst it might be possible to entirely reverse out of the current proposal, the Trustee may conclude that the current proposal is the best that can be obtained because

(i) the Council ran a competitive process,

(ii) that process was premised on the retention of community use on essentially the same basis as current,

(iii) the resulting lease premium and rent are the best consideration obtainable (and have been signed-off as such by valuers),

(iv) the Trust take a share of that premium and rent (on a fair and equitable basis), and

(v) ongoing use of the Trust property is protected by the lease structure and Protocol.

Also, the Trustee may recognise that available options do not include the status quo, whereby it seeks

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to continue a reliance on Council subsidy.

c) Under the protocol, it will be the operator of the hotel who decides who can hire the facilities - not the Trustee. This could be detrimental to the Charity, particularly as the operator does not have to give priority to community use and there are no reserved times for community use. Given that hirers would access the facility through the hotel and use its facilities, the hotel may be reluctant to let the facility to certain groups that it did not want on its premises or prioritise use by one of its customers over community use. Further, the operator will have no incentive to encourage community use and potentially could discourage it. It is possible that certain community groups may be reluctant to hire facilities in, what [the Charity Commission] understand will be, a boutique hotel. (c) If, despite the covenants, the hotel operator refused to let the hall to community groups, it is not clear how this could be enforced. Whilst it would seem to fall to the Council in its corporate capacity as landlord to enforce the community use, it may have no incentive to do so. The Council as trustee would not have any funds to take legal action and it seems unlikely that the Council as trustee would act against the Council as landlord to enforce the community use.

Information related to protections to the Trust under the proposed lease arrangements are covered in section 9a above. In addition, the current proposals are that the hotel operator will grant a sublease to the Trust of the Victoria Hall. It is not however proposed that the Trust will be responsible for day to day management and maintenance of the Victoria Hall. It is expected that a management services agreement will be needed to enable the hotel operator to manage the Hall from day to day and this could include details for management of the hirings. The Trust will have control of bookings or how they are manged via the sub-underlease even where that is delegated to the Council via a Management Services Agreement. Assuming that the Management Services Agreement will include details of the agreed hiring arrangements, the Protocol could be amended to reflect the position with regard to the Queen’s Hall and Victoria Hall. All of this needs to be seen in the context of how the Trust has operated historically, i.e. entirely reliant on the Council for the administration of community use. Therefore these suggested arrangements will improve on that and provide the Trust with a greater ability to enforce than is the case at present.

Option c) A Management Services Agreement will be developed and will include the agreed hiring processes for the Victoria Hall. Once this has been agreed with the hotel operator the Protocol can be amended to align with the process for the Victoria Hall and for completeness could include the Queens Hall. The Council have confirmed that Mastcraft are amenable to this.

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In relation to the Trust further considering whether the proposals represent a loss of control, options available to the Trust would be to:

a. Retain the Protocol as drafted b. Amend the Protocol to reflect the sub underlease of

the Queens’ Hall c. Amend the Protocol to include controls on the hire

of the Victoria Hall and Queen’s Hall

(d) The Halls will only be available for hire by, basically, registered charities and non-profit community groups with the majority of their members resident in Ealing. Whilst this may be a convenient way for the hotel to check whether a group is entitled to the reduced charges, this would potentially preclude other users.

This is incorrect. The Halls will be available for registered charities and non-profit making organisations but there is no reason that they should not also be available for other community groups or users. There appears to be confusion between community ‘use’ and those organisations that qualify for the community ‘rate’. Options available to the Trust in relation to the issue of whether the proposals exclude certain groups:

A. Retain the Protocol as drafted B. Amend the Protocol to make it clear that any

members of the public can hire the Victoria Hall.

Option a) The current system has worked successfully and there is not deemed any reason to amend it at this time.

(e) The income from letting the Victoria Hall will go to the private company, Surejogi. Whilst it will bear all of the costs of making the property available, any ‘profit’ will stay with the Company and will not be available for application for the secondary purpose.

This is correct however the Trust will receive its share of profit generated from the Victoria Hall and without exposure to losses or ongoing maintenance costs. In particular, the head lease provides for payment of an annual Base Rent by Mastcraft to the Council (£250,000, subject to upward reviews). There will need to be a mechanism by which the Council pays the Trust a share of that rent. The apportionment has yet to be agreed but it will be based on the Trust and Council each obtaining their own independent advice and then agreeing an apportionment

This requires no action but the response to the Charity Commission will explain the position (they have had sight of the Lease already).

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The Council (and therefore the Trust) is also entitled to an annual Turnover Rent from Mastcraft. If 7% of Mastcraft’s turnover in a year exceeds the Base Rent mentioned above, then Mastcraft has to pay the excess to the Council as rent, before it calculates its profit. The Turnover calculation takes into account any consideration received by Mastcraft in relation to the operation of the Community Use Property. The Trust will be receiving a proportionate share of this rent too. It should be noted that for many years the Trust has been subsidised by the Council and the ability of the facilities to be profit-making is questionable. The historical arrangement has exposed the Trust to liabilities for losses (albeit that the Council has funded these through subsidy). Whilst it is correct that the Mastcraft proposal would require the Trust to waive any future profit which might be generated it also removes the Trust’s exposure to losses.

f) The refurbished Victoria Hall will no doubt provide function room facilities appropriate to a boutique hotel. Whilst this may be suitable for use for events such as a charity dinner dance fundraising event, it may not necessarily be the most suitable type of venue for recreational and leisure time use in the modern day. [The Charity Commission] have not seen any analysis of this.

The Victoria and Queen’s hall will each be available for hire and provide facilities which will accommodate a range of modern uses and requirements. Other rooms in the hotel element of the development will also be available at community rates. To the extent that this range of types of accommodation is not suitable for specific types of new groups the Trust can consider applying its income to supporting groups in finding accommodation elsewhere. In summary it is considered that overall the facilities available in the hotel and in the Queen’s Hall will provide a wide community offering and will be accommodate a wide and diverse variety of community activities as evidenced the range of demand.

See options / recommendation at 4.5.3 b) and 4.3.9 above.

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(g) Although one of the benefits of the transaction has been presented by the Council as being the preservation of the Victoria Hall, this is not an object of the Charity.

Noted

To be noted.

(h) The ‘swap’ of the Smaller Queens Hall for the Princes Hall will take place before the transaction with the Company is completed. Since the apportionment of the premium and rent will be on the basis of floor space, this means that that the Charity will receive a reduced premium and rent to what it might have been entitled if the swap had not taken place.

As 4.5.3 (a)

As 4.5.3 (a)

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Notice of Meeting: General Purposes Committee

Documents

Transcript of Notice of Meeting: General Purposes Committee