Hockey and trust law, two concepts that are not usually mentioned together. With the NHL lockout now stretching into the weeks (if not months), there is no shortage of articles detailing the arguments back and forth in the lockout. In the onslaught of articles, one article in particular caught my attention after the author mentioned something I had not known before. The Stanley Cup, it seems, is not owned by the NHL, but is rather held on a charitable trust.
A quick look at the Wikipedia page for the Stanley Cup reveals that when donating the Stanley Cup, Lord Stanley of Preston provided the trustees of the cup with five instructions. They were:
1. The winners shall return the Cup in good order when required by the trustees so that it may be hand over to any other team which may win it;
2. Each winning team, at its own expense, may have the club name and year engraved on a silver ring fitted on the Cup;
3. The Cup shall remain a challenge cup, and should not become the property of one team, even if won more than once;
4. The trustees shall maintain absolute authority in all situations or disputes over the winner of the Cup; and
5. If one of the existing trustees resigns or drops out, the remaining trustee shall nominate a substitute.
Charitable trusts are a well-defined area of the law. Unlike a trust in most circumstances, a charitable trust does not require you to be able to ascertain the beneficiaries of the trust (so long as the court is satisfied that the settlor intended to benefit “charity”), and are also not subject to the rules against alienability or indefinite duration. As phrased in The Law of Trusts: A Contextual Approach, property subject to a charitable trust can be expressed as the “exclusive dedication of property to a charitable purpose in a way that provides a public benefit.” In the case of the Stanley Cup, it seems, the public benefit is the promotion of hockey.
All of which brings us back to an interesting question. Who should be awarded the Stanley Cup if the lockout should cancel the entire season. If the Stanley Cup is truly held on a charitable trust, which by definition requires there to be a public benefit, why do NHL teams have exclusive jurisdiction over the ability to be awarded the Cup? If the NHL is not going to hold a competition this year, why can’t the trustees award the cup to another team in their place? Would that not be for the “public benefit”?
Thank you for reading.