Supreme Court victory for charitable foundation following divorce battle

The success of this legal challenge will provide clarity for charities, lawyer says

The Supreme Court has reinstated the original High Court decision
The Supreme Court has reinstated the original High Court decision

The Supreme Court has ruled that the Children’s Investment Fund Foundation (CIFF) must give $360m to Big Win Philanthropy (BWP), following the divorce of CIFF’s founders.

Jamie Cooper and Sir Chris Hohn set up CIFF in 2002, but the couple’s divorce in 2014 led to protracted legal action over the charitable company.

A High Court ruling in 2017 directed Marko Lehtimäki, the third member of the CIFF company along with Hohn and Cooper, and the only one without an obvious conflict of interest, to make the nine-figure payment to BWP, Cooper’s new charity.

This decision was reversed by the Court of Appeal in 2018, which ruled Lehtimäki should make a decision in the best interests of CIFF.

The Supreme Court decision, published today, reinstates the original decision and concludes that the courts do have the power to direct the members of a charitable company in the same way as it would direct trustees, even if there is no evidence that they have breached their fiduciary duty. 

Cooper said in a statement that she was “extremely gratified” by the decision. 

She said: “This will enable Big Win Philanthropy to significantly expand its support to African leaders pursuing ambitious initiatives to improve the lives of children and young people. I am very grateful to my legal team who worked so hard to achieve this result.” 

Leticia Jennings, partner at Bates Wells, who led the legal action on Cooper’s behalf, said the case was “the most important charity law case in many years”. 

She said: “It has clarified many issues relating to members of charitable companies and their duties, as well as resolving frictions found in company law when it comes to charitable companies. 

“This was the right decision in law and the right decision for charity.”

In a statement, CIFF said the charity was pleased that the proceedings had now concluded. 

“Today’s decision by the Supreme Court will have no significant impact on the work that CIFF does around the world to improve the lives of children,” the statement said.

“CIFF’s endowment of around $5bn provides sufficient funds to pursue the charitable objectives that we have set out and we expect to make grants totalling $340m this year and $345m in 2021, a sizeable increase on previous years.

“Our focus has always been – and will remain – on our long-term aim of protecting and empowering children and young people, so they can survive and thrive in a world in which they face multiple challenges.”

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