The charity tribunal was created four years ago to offer a rapid, low-cost way of contesting decisions by the Charity Commission. It allows people to bypass the commission's own 'decision review' process and, crucially, get to see all relevant documents before a hearing.
So far, there have been 27 appeals to the tribunal, but the number of commission internal reviews has risen rather than fallen. There were 38 in the year to March 2009, and the figures for the following years were 38, 53 and 49.
Some internal reviews were of cases in which an appeal to the tribunal would not have been admissible: schedule six of the Charities Act 2011 imposes restrictions on the kind of actions (or refusals to act) by the commission that are capable of being appealed, and by whom.
The commission does not keep figures on how many internal review cases were capable of being appealed to the tribunal. But it confirms that many charities have opted for internal review even when the tribunal was open to them.
Sticking with the commission
Alison McKenna, the tribunal's principal judge, speculated in a speech to Melbourne Law School in Australia this year that charities were litigation-averse for various good reasons, that they might be scared of damaging their relationship with the regulator and that charity lawyers preferred to keep things informal.
She added that she thought the most significant reason for the relatively low number of cases coming to the tribunal was that the commission was making fewer formal orders of the kind capable of being appealed under schedule six.
Charity lawyers offer various reasons for the continued use of the commission's review process to challenge commission decisions, such as a refusal to grant charitable status or vary a charity's objects.
Rosamund McCarthy, a partner at Bates, Wells & Braithwaite, agrees that the restriction on appeals imposed by schedule six is a factor. Others were time, money and the flexibility of the review process.
"You have to think about what it will cost," she says. "How long will it take? What are the consequences of a decision it might make?
"I think for trustees, the idea of an internal review process is no big deal, whereas going to the tribunal is. By talking to the commission you can have a dialogue. There is a sense that you have nothing to lose by asking for an internal review as you still have the option of going to the tribunal."
Jo Coleman, partner at IBB solicitors, says many charities prefer the simplest option. "No one litigates for the hell of it," she says. "Charities are focused on getting the quickest resolution and generally it is perceived that asking the commission to review it is seen as more cost-effective than going to the tribunal. An internal review may appear to offer a quicker resolution."
A commission spokeswoman says reasons given to it for preferring a decision review include a shorter timescale, less cost and a less legalistic, more conciliatory procedure. "It has the capacity to effect a compromise instead of a 'right or wrong' sort of approach," she said.