Cy-près (pronounced sih-pree) is a legal term that originated from French law and is used in NSW in relation to trusts. A cy-près scheme is a legal process that allows the Supreme Court of NSW to modify the terms of a charitable trust to ensure that the trust’s objectives are still met, even if the original purpose of the trust is no longer possible or practical.
The Supreme Court of NSW has this power under the Charitable Trusts Act 1993. Under this Act, a cy-près order may be made if the original purpose of the trust has become impossible, impractical, or if the original charitable purpose is no longer relevant due to changing circumstances.
For example, if a trust was established to provide financial assistance to a specific group of people, but that group no longer exists, a cy-près scheme may be initiated to modify the trust’s terms and provide financial assistance to a similar group or cause.
To initiate a cy-près scheme in NSW, an application must be made to the Supreme Court. The application must include evidence that the original charitable purpose of the trust is no longer possible or practical and that a cy-près scheme is necessary to ensure that the trust’s objectives are still met.
The court will consider the evidence presented and may make a cy-près order to modify the terms of the trust. The court may also appoint a trustee to manage the trust in accordance with the modified terms. It is important to note that cy-près schemes are only applicable to charitable trusts and cannot be used to modify the terms of a private trust or a will.
In summary, cy-près schemes in NSW allow the court to modify the terms of a charitable trust to ensure that the trust’s objectives are still met, even if the original purpose of the trust is no longer possible or practical. To initiate a cy-près scheme, an application must be made to the Supreme Court, and evidence must be presented that a cy-près scheme is necessary to achieve the trust’s objectives. It is important to seek legal advice before initiating a cy-près scheme to ensure the best possible outcome.
At Adams & Partners Lawyers, we can assist you in the process of making applications of these types. We have offices in Penrith, Parramatta, Richmond, and Sydney.
Written by Cameron Spanner.
