Section 7 of CART Act : Section 7: Powers Of Trustee To Apply For Directions

Explanation using Example

Imagine that the trustees of "Green Future Charitable Trust," which is dedicated to environmental conservation, are unsure whether they can allocate a portion of the trust's funds to start an educational program about recycling in local schools. This program was not explicitly mentioned in the trust's original charter, but the trustees believe it aligns with the overall mission of the trust.

To ensure they are managing the trust's assets responsibly and in accordance with legal requirements, one of the trustees decides to seek the Court's guidance. They file a petition to the local Court where the trust operates, explaining the situation and asking whether the proposed allocation of funds for the educational program is within the scope of their administrative powers.

The Court reviews the petition and decides to set a hearing date, notifying other interested parties, such as beneficiaries and co-trustees, to provide them with an opportunity to present their views on the matter.

At the hearing, after considering all viewpoints, the Court provides its opinion, advising that the educational program is indeed a proper use of the trust's funds as it serves the public purpose of environmental conservation. The trustees, acting in good faith on this advice, proceed with the program and are protected from liability regarding this decision, as they have followed the Court's direction.