## Facts

- Charles B. Henry, a resident of Winchester, Virginia, executed a will on April 21, 1949, and died on April 23, 1949.
- The will left the residuary estate (about \$86,000) to Shenandoah Valley National Bank of Winchester as executor and trustee, to hold as the “Charles B. Henry and Fannie Belle Henry Fund.”
- The trustee was directed to invest the corpus and, twice yearly (the last school day before Easter and before Christmas), divide the net income into equal parts for all children in the first, second, and third grades at John Kerr School in Winchester.
- Each child was to be paid one equal cash share, stated to be “used by such child in the furtherance of his or her obtainment of an education.”
- The trustee had no discretion over eligibility or amounts and no mechanism to supervise or restrict how the money would be used after payment.
- Distributions were made to every child in the designated grades without regard to financial need.
- An heir challenged the trust as noncharitable and therefore void under the rule against perpetuities.

## Issues

1. Whether the will created a valid charitable trust (including an educational charitable trust) for the benefit of children attending a designated public school.
2. If not charitable, whether the trust was a private trust of indefinite duration that violated the rule against perpetuities and was void.
3. Whether a court could preserve validity by modifying the method of payment (e.g., paying parents or guardians) without changing the dispositive substance.

## Decision

- The Supreme Court of Appeals of Virginia affirmed the trial court.
- The court held the trust was not charitable because its dominant purpose and operation were benevolent gifts rather than the advancement of education or other recognized charitable ends.
- Because the trust was noncharitable and intended to continue indefinitely for successive classes of children, it violated the rule against perpetuities and was void.
- Proposed administrative adjustments to the payees would not convert unconditional gifts into a charitable educational trust.

## Legal Principles

- A charitable trust requires a dominant charitable intent and a practical operation that fits within recognized charitable purposes; benevolence alone is insufficient.
- Labels or stated motives (e.g., references to “education”) do not establish a charitable trust where beneficiaries receive unrestricted cash with no enforceable limitation to a charitable use.
- Distributions to a class without need-based limitation or other public charitable objective may be treated as private gifts rather than charity.
- Courts may adjust administrative details of a valid charitable trust, but they cannot rewrite a dispositive plan to create charitable substance where the instrument provides none.
- Noncharitable trusts are subject to the rule against perpetuities; a private trust designed to continue indefinitely is void.

## Conclusion

The court invalidated the testamentary trust because it functioned as unconditional holiday-time cash gifts to a rotating group of schoolchildren rather than an enforceable charitable educational program; as a noncharitable trust of potentially perpetual duration, it violated the rule against perpetuities and failed.


Shenandoah Valley Nat’l Bank of Winchester v. Taylor, 192 Va. 135, 63 S.E.2d 786 (Va. 1951)