ASSET OR LIABILITY?

Wairarapa Times-Age, 18 May 1939, Page 8

ASSET OR LIABILITY?

FUTURE OF A. P. WHATMAN BEQUEST QUESTION OF MAINTENANCE COST. HOSPITAL BOARD VIEWS. The future of “Panama,” the residence and property of which the late Mr A. P. Whatman bequeathed to the Wairarapa Hospital Board as a convalescent home, was again discussed at yesterday's meeting of the board. At a recent meeting the Public Trustee advised that the residue cf the estate, including the value of the realty, was approximately £15,881; that the income would be approximately £4OO to £5OO per year; and that no revenue would be available until 1945. On several occasions the board has considered the bequest and the question has been raised as to whether trust should be accepted or repudiated as some members considered it to be a liability and not an asset. At the April meeting of the board it was decided that before a definite decision on the matter was arrived at the. advice of the Department of Health should be obtained. On May 1, at the request of the department the following met in conference to investigate the matter; Messrs J. Prendeville, Crown Solicitor; H. Gunn, Department of Health; S. V. Gooding, solicitor to the board; H. H. Mawley, chairman; and Norman Lee, Managing-Secretary. In a report on the outcome of the conference, submitted to yesterday’s meeting of the board, the chairman, Mr H. H, Mawley, said: “Whether a convalescent home is necessary or otherwise is not determined; in fact the cost of maintaining convalescent patients in hospital is not much greater than maintaining them in a separate home. However, the necessity may arise in the future when it would be an advantage for a convalescent home to be established as an adjunct to the hospital. When this time arrives the home should be in close proximity to the hospital—-not miles away. With a home in the grounds at Masterton hospital all the services would be available and there is accommodation for the staff.” Mr Mawley said that if a convalescent home were established at “Panama’’ the annual salaries would aggregate approximately £llOO. After dealing with the question of accommodation he said that in addition to salaries the staff living-in would have to be kept on a conservative basis and the estimated cost would total about £4OO a year. Without any maintenance costs the total charges for maintaining a staff at the home would be approximately £l5OO. Furthermore, small institutions of that type were expensive to maintain.

“I have,” added Mr Mawley, “so far dealt only in a general way with maintenance costs. Certain capital charges would be necessary to utilise the residence for staff only and furnishings would be required—then a convalescent home would have to be built and this may cost from £B,OOO to £lO,OOO. All these factors were considered by those attending the conference and to reiterate the concensus of opinion was that the trust with its restrictive conditions is practically impossible to implement. “The members of the conference are of the opinion that as the value of the trust is considerable it should not be allowed to lapse without making some endeavour to have the restrictive conditions varied so that the board could take advantage of the bequest. It is obvious that the intention of the testator was to create a charitable trust, therefore, it is a matter for consideration as to whether application should be made to the Court to have the trust deed varied go that the bequest maybe of value to the board and not a lia ■ bility and irksome obligation. The solicitors present .discussed this suggestion of variation and indicated the case was one for submission to the Court to apply the ‘cy-pres’, doctrine —this is a doctrine of law providing for variation of the purposes of charitable trusts where the conditions make performance impossible or impracticable. There are many cases on record where the Court has made orders in accordance with this doctrine.”

Mr Mawley said that trustees of the estate, Messrs F. M. Whyte, District Public Trustee, and G. W. Sellar, had agreed that the conditions made acceptance of the trust impossible. Mr Whyte indicated that he could not commit the Public Trustee, but would strongly recommend that application be made to the Court for a variation of the terms of the trust. Mr Sellar said that provided a charitable trust was established he had no objections to variation. After consideration of Mr Mawley’s report and other aspects of the bequest, the board decided that Mr Mawley and the Managing-Secretary, Mr Norman Lee, should discuss the matter with the Director-General of Health, Dr R. A. Shore, and report back to the next meeting of +he board.