Trustee changes and how to deal with your property title

A common problem for charity trustees is what to do with their property interests when the trustees need to retire or be appointed. This can be a costly exercise in ensuring that the property title is held in the correct names and often frustrating as once the trustee names are updated they can often change again. The process is to apply to the Land Registry by submitting an application form, completing a formal transfer of title and paying a Land Registry fee.

This in itself is cumbersome, but if any of the trustees named on the title cannot be found or lack capacity to sign the transfer, it becomes even more complex. There are however some potential solutions to this problem:

  1. Set up a charitable company (which as such is a permanent legal personality) although this may not be appropriate for all charities particularly if they are small.
  2. Incorporate the trustees (under Section 251 of the Charities Act 2011) – the trustees then become the body corporate under Part 12 of the 2001 Act. 
  3. Vest the property in the Official Custodian – this is a statutory holding trustee under Section 21 and Schedule 2 of the 2011 Act.

The Official Custodian route can lead to difficulties given that the property is legally in the name of the Official Custodian but the transfer has to be executed by the trustees to be valid. Therefore the option of incorporating the trustees can be a simpler option for a smaller charity. 

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