The potential conflict of interest the Charity Commission has identified in the governance of the Royal Albert Hall is to be considered by the charity tribunal after a decision by the Attorney General, Jeremy Wright QC.
He has given consent under a little-used provision of charity law for the commission to refer five key questions about the case to the tribunal.
The move was welcomed by the commission, but the hall said it was disappointed that the commission had taken this "costly and drawn-out" route.
The hall’s president, Jon Moynihan, also criticised the commission in a message at the weekend, saying "the way they are proceeding so litigiously falls below the standard we are entitled to expect from our regulator".
The commission has contended for several years that there is a potential conflict of interest on the hall’s governing council, where 19 of the 24 members are elected from among people who own a quarter of the hall’s seats and can sell tickets for them at inflated prices.
The commission has said there is a risk that council members will prefer their own interests to those of the charity, but the hall has refused to accept its proposal that seat-holders should cease to be a majority on the council. The commission is now preparing to impose revisions to the hall’s constitution, which is set in acts of parliament.
A spokeswoman for the commission said it had asked the Attorney General for his consent to use the reference procedure, which is designed to resolve difficult questions of charity law, because of "the unusual nature and complexity of these issues, as well as the lack of progress on addressing the central issue".
She said she could not give detail about the questions because they were still being finalised.
An earlier commission statement said the questions "will include, but are not limited to, the nature of the charity’s constitution, the commission’s ability to issue a scheme in order to amend the constitution and the proposed content of such a scheme".
Because of the unusual nature of the process, it is not yet clear whether the tribunal will rule on the substantive issues of the case or confine itself to clarifying procedural matters.
Moynihan criticised the commission in his weekend message to seat-holders for declining to show the hall the legal analysis of its counsel, even though the hall had shared its own legal analysis with the commission.
"We think the commission’s behaviour in the way they are proceeding so litigiously falls below the standard we are entitled to expect from our regulator, and is unhelpful in resolving the matter more easily," he wrote.
"While the commission had specified five questions in its request to the Attorney General, it has indicated that this may not be the final form of the questions that are sent to the charity tribunal. The AG, in giving his permission, has not commented on what the final form of the questions should or could be.
"We have asked both parties to engage in further discussions with us on the wording of those questions, since as currently phrased they are both faux-ingenuous, and potentially damaging to the hall.
"We still think a dialogue with the commission is the way to go, but they still refuse to meet us further, and seem insistent on going straight to the expensive, lengthy and unnecessary route of putting various arcane questions to the charity tribunal."
The Conservative peer Lord Hodgson, who recently questioned the government about the progress of the reference, welcomed the Attorney General’s decision and said clarity was important, whatever the tribunal decided.
"Allegations and counter-allegations can only damage the reputation of the whole sector in the eyes of the public, who don’t necessarily understand the complexities but feel that something is not quite right," he said.
"And this comes after a number of difficult issues that have caused reputational problems in the sector, among them fundraising methods, staff pay levels, the collapse of Kids Company and the Cup Trust scandal."
The Albert Hall confirmed today that two senior staff had recently left: James Ainscough, chief operating officer, whose post was made redundant, and Amanda Squires, head of operations, who resigned. Last May, Craig Hassall, former chief executive of Opera Australia, took over as chief executive of the hall.