London school sold and shut by trustee who acted ‘without considering consequences’

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The former trustee at Grangewood Educational Association has been found responsible for serious mismanagement and/or misconduct in the charity’s governance, management and administration, and in the handling of transactions, including the sale of the school.

The charity was set up to provide Christian education, and operates the Grangewood Independent School in Newham, London.

The Charity Commission opened a statutory inquiry on 15 April 2018 and appointed interim managers to the charity on 24 April 2018 in response to several serious concerns, including that significant decisions had been taken for the school by a sole trustee. Decisions included the sale of the school building and the closure of the school.

The inquiry found:

  • the charity was inquorate for several significant periods of time
  • the sole trustee made the decision to sell the school and then lease it back
  • the sole trustee made the decision to close the school, without considering the consequences and families were given short notice of the closure with little time to find alternative arrangements.
  • parents were protesting against the decision to close the school by occupying the school premises. The sole trustee had instructed solicitors to instigate a Possession Order to remove the parents.
  • a loan of £5,000 was paid to the sole trustee and then used to settle the trustee’s own debts. The charity’s financial records show that the three trustees in post during 2016 and 2017 received £31,905 in expenses, but these were not recorded in the accounts.

As the charity did not have sufficient trustees to make quorate decisions, the trustee should not have sought a Possession Order against parents, and the Commission refused to grant permission to allow this action to go ahead.

Due to the appointment of new trustees on 29 August 2018 and their subsequent engagement with the interim manager, there is now adequate due diligence, monitoring and risk management procedures in place and there appears to be no ongoing risk to the charity or its assets.

The sole trustee formally ceased to be a trustee from 23 July 2018 when his directorship of the charitable company ended and he was not re-appointed. The trustee has undertaken to not accept a trusteeship for a charity or any charities for a period of ten years from this date.

The school continued to function throughout the period of the appointment of the interim managers and the statutory inquiry, and remains open.

Amy Spiller, Head of Investigations Team at the Charity Commission, said:

The Grangewood community were treated poorly, by the inadequate way this charity was managed and how decisions were taken. The sole trustee, who should not have made decisions alone, failed in his responsibilities to the charity and let the school community down.

We took action to support the reopening of the school and protect the charity from suffering further harm, and we’re satisfied it has now made the significant changes to its governance needed, but it should not have taken this level of disruption to pupils, families and staff for this to happen.

The public rightly hold charities to high standards, and trustees as the custodians of charity, have a responsibility to ensure that they carry out their duties with care and skill.

/Public Release. View in full here.