TRUSTS-CHARITABLE TRUSTS-EFFECT OF NATIONALIZATION ACT ON GIFTS TO ENGLISH HOSPITALS

Complainant held property under a trust created by a Rhode Island will, the validity of which had previously been determined by the Rhode Island court. Respondent hospitals were remainder beneficiaries of the trust, the gifts to them being subject to certain limitations on their use. Respondent churches were named in the trust deed as alternative legatees "in case any of my preceding gifts, specially my gifts to Public purposes, should fail .... " The remainder interests vested, and partial distribution of the corpus was made in 1939.

In 1946 the National Health Service Act was passed in Great Britain which nationalized all hospitals, including respondents, and vested all property in which they had any beneficial interests in the Minister of Health, or a governing board under his control. The property was to vest free of all trusts, but trust funds were to be used for stated purposes "as far as practicable." In an action by the trustee for instructions, held, the gifts to the English hospitals failed by reason of the Health Act, and vested in the respondent churches as alternative legatees. The naming of alternative legatees precluded cy pres performance. Pennsylvania Co. for Banking and Trusts v. Board of Governors of London Hospital, CR.I. 1951) 83 A. (2d) 881.