Education (Scotland) Act 1980

107 Educational endowments applicable in part to non-educational purposes

(1) Where an endowment is an educational endowment within the meaning of this Part of this Act, and part of it is applicable or applied to other charitable purposes, the scheme shall be in conformity with the provisions of subsections (2) to (6) below (except so far as the governing body of such endowment assent to the scheme departing therefrom).

(2) The proportion of the endowment or annual income for the time being derived therefrom which is applicable to such other charitable purposes shall not be diverted by the scheme from such purposes unless in the opinion of the Secretary of State—

(i) there are no persons who are entitled to benefit out of such part of the endowment; or

(ii) the purposes of such part of the endowment have failed altogether or have become obsolete or useless or are otherwise sufficiently provided for; or

(iii) such purposes have become insignificant in comparison with the magnitude of such part of the endowment; or

(iv) such purposes have become prejudicial to the public welfare.

(3) The proportion of the endowment or annual income for the time being so applicable to such other charitable purposes shall be deemed to be the proportion which, in the opinion of the Secretary of State, is the proportion which has according to the average of such number of years as the Secretary of State shall determine been appropriated as regards capital or applied as regards income to such purposes, or if that proportion differs from the proportion which ought to have been so appropriated or applied according to the express directions of the instrument of foundation or the decree of any competent court or the statutes or regulations governing such endowment, the proportion applicable to such other charitable purposes shall be the proportion which ought, according to the express directions of such instrument, or such decree or such statutes or regulations, to have been appropriate or applied to such other charitable purposes.

(4) If the proportion applicable to other charitable purposes amounts to or exceeds one half of the whole of the endowment, the governing body of such endowment existing at the date of the scheme shall, so far as regards its non-educational purposes, remain unaltered by the scheme.

(5) Where the governing body remains so unaltered, that body shall pay or apply for educational purposes such proportion as under the former provisions of this section is applicable to those purposes, or such less sum as may be fixed by the Secretary of State.

(6) When any portion of the endowment or the annual income of such portion has been accumulated and not applied to any purpose, the Secretary of State shall determine whether, and in what proportion, such portion or income is to be considered for the purposes of this section as having been appropriated or applied for educational purposes or for other charitable purposes.

(7) Subject to the foregoing provisions of this section, the Secretary of State shall have power by any scheme to deal with any such endowment, and with the governing body thereof, in the same manner in all respects as if it were an endowment applied wholly to educational purposes.