Charitable Trusts Act 1957

Schemes in respect of charitable funds raised by voluntary contribution

40: Property may be disposed of for other charitable purposes

You could also call this:

"Rules for using charity money for different purposes when the original plan doesn't work"

If you raise money for a charity but can't use it for the original purpose, you might be able to use it for a different charitable purpose. This can happen if:

It's impossible, impractical, or not a good idea to carry out the original purpose
There's not enough money to do what was planned
The original purpose has already been achieved
The original purpose is against the law, useless, or unclear

If any of these things happen, and the money hasn't been used within a year of being collected, you can use it for a different charitable purpose.

Sometimes, you might raise more money than you need for the original purpose. In this case, you can use the extra money for another charitable purpose.

These rules also apply to cases where the charitable purpose was defined by a plan approved by the Attorney-General or a court. In these situations, you can go back to the original purpose, with or without changes.

These rules apply to money raised and plans approved both before and after this law was made.

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This page was last updated on 15 April 2025

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM309970.

Topics:

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39: Funds to which this Part applies, or

"This part explains which charitable donations are covered by the law"

41: Extension of powers or alteration of mode of administration of trust, or

"Changing how charity money is managed when it's difficult"

Part 4Schemes in respect of charitable funds raised by voluntary contribution

40Property may be disposed of for other charitable purposes

In any case to which this Part applies—
if it becomes impossible or impracticable or inexpedient to carry out the charitable purpose for which the money raised is held, or if the amount available is inadequate to carry out that purpose, or that purpose has been effected already, or that purpose is illegal or useless or uncertain; and
if the money has not been entirely applied, and is not in the course of being applied, for the charitable purpose for which it is held at any time after the expiration of 1 year after the contribution or receipt of any part of the money or the sale of any part of the goods—

In any case to which this Part applies, if the money raised and the income which has accrued or will accrue therefrom or any residue thereof is more than is necessary to carry out the original charitable purpose, any excess money or income may be disposed of for some other charitable purpose, or a combination of such purposes, in the manner and subject to the provisions hereafter contained in this Part.
This section shall extend to cases where the charitable purpose for the time being affecting any money or income is defined by a scheme approved by the Attorney-General or the court under this Part or otherwise approved by the court, and in any such case the original purpose or purposes may be restored, with or without modifications.
The provisions of this section shall apply with respect to money raised, and to schemes approved as aforesaid, before or after the commencement of this Act.

Compare

1908 No 164 ss 33, 34
1928 No 55 s 5