Charities' Legal Spend - In Support Of Your Charity, What To Be Aware Of

What do charities need to consider to demonstrate responsible management?

Charity spending on legal fees recently hit the headlines again, as part of Save the Children being questioned before the International Development Committee of the House of Commons about the recent allegations against it. Part of the session included questions on letters sent by the charity's lawyers to media organisations in response to the media's unfavourable reporting on the allegations.

It is not the first time that charities have come under scrutiny for their legal spending and proactive legal action. The former chair of the Charity Commission, William Shawcross, noted in one of his last interviews before leaving office that well funded charities may be using lawyers to head off unwanted attention.

Separately, the RSPCA has had to justify its spending on private prosecutions on alleged animal cruelty.

Charity, including academy, trustees have a duty to act in furtherance of their charitable objects and to manage charity resources prudently. There is significant scope for trustees to determine what may be in the best interests of their charity.

As part of that trustees are actively encouraged to seek advice as and when they need it. Setting an annual budget for legal (and other professional) advice can help demonstrate responsible management Charity Commission guidance states that "a decision to take or defend legal action must be made exclusively in the best interests of the charity, having considered whether or not another course of action is available". That includes...

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