Gifts in Wills and Bequests

Where a donor proposes making a gift to the University during his or her lifetime, Advancement staff will liaise with the donor to:

• identify the purpose for which the gift is to be made, taking into account the current needs and priorities of the University, and also taking into account the future plans of the University; and
• prepare a document (usually a Memorandum of Gift) that records the purpose for which the gift is made, in a way that ensures that the donor's wishes can always be implemented by the University, even if there are changes to the content or structure of a particular course, or if there are changes to the research priorities of the University.

The University cannot provide donors with any legal or tax advice in relation to a proposed gift.

Referrals for advice can be obtained from:

• The Law Institute of Victoria
• CPA Australia
• Institute of Chartered Accountants

Before making any gift to the University a donor should, therefore, seek independent advice, including legal advice and taxation advice.

Regardless of the type of gift, a donor must always specify the purpose of the gift, which should preferably be described in broad terms including the benefit the donor wishes to confer.  This ensures that the donor's wishes can always be implemented by the University, even if there are changes to the content or structure of a particular course, or if there are changes to the research priorities of the University.

When proposing a gift to the University, donors might consider the various groups at the University who would particularly benefit from financial support, including students in financial need, disabled students, and indigenous students.

Below are some sample clauses of broad gifts.  Donors should contact the University for assistance in drafting their Gift clause.

Donors should get their own independent legal advice regarding the particular terms of their Gift. If the clauses below do not cover the donor’s intentions, please contact the Advancement team.

A gift for the general purposes of the University

The general purposes of the University include the educational purposes of the University (namely research, learning and teaching, engagement) and also the ancillary functions of the University (including the construction and maintenance of the University buildings and grounds). A gift for the general purposes of the University will most likely need to be reflected in a University trust instrument so that all relevant terms are appropriately recorded.

In this example a perpetual charitable trust is not established, and the University will apply the gift for the projects that have top priority at the time of the gift:

The gift is for the general purposes of the University, and the gift is to be known as ‘The [insert title] Gift’.

A gift for the educational purposes of the University

The University’s educational purposes comprise research, learning and teaching, and engagement.

In this example a perpetual charitable trust is not established, and the University will apply the gift for the educational projects that have top priority at the time of the gift:

The gift is for the educational purposes of the University, and the gift is to be known as ‘The [insert title] Gift’.

A gift for the libraries at the University

In this example a perpetual charitable trust is not established, and the University will apply the gift for the projects at the libraries that have top priority at the time of the gift:

The gift is for the libraries of the University, and the gift is to be called ‘The [insert title] Libraries Gift’.

Gifts to the University from a donor’s estate which are specified in their Will, are called a bequest.

When making a bequest to the University by a Will, there are two types of gift:

• a residuary bequest, where the donor gives a portion of his or her residuary estate; or
• a specific bequest, where the donor bequeaths gives a specified sum (called a legacy) or a specified asset.

Staff will liaise with donors to identify the purpose for which the bequest is to be made, taking into account the current needs and priorities of the University, and also taking into account the future plans of the University.

Donors must then instruct their solicitors to prepare a Will that records the gift and its purpose.

Where an unusual or complex gift is proposed, the Advancement staff will arrange for the Specialist Trusts Lawyer to assist with this process.

The University cannot provide donors with any legal or tax advice regarding a proposed bequest.

Referrals for advice can be obtained from:

• The Law Institute of Victoria
• CPA Australia
• Institute of Chartered Accountants

More information is available on our Gifts in Wills website.

A gift made after the donor’s death, as described in the donor’s Will, is called a bequest. To assist donors and their solicitors, the University suggests the following Will clauses:

1. For the general purposes of the University:

   I give [percentage of my residuary estate / dollar amount / specified assets] ('the bequest') to The University of Melbourne of Grattan Street, Parkville, Victoria ABN 84 002 705 224 ('the University'), for the general purposes of the University. The Bequest is to be known as The [insert name] Bequest.

2. For a specific purpose:

   I give [percentage of my residuary estate / dollar amount / specified assets] ('the bequest') to The University of Melbourne of Grattan Street, Parkville, Victoria ABN 84 002 705 224 ('the University'). It is my preference that the bequest support [insert purpose, e.g. scholarships for students in financial need / the University libraries / the Melbourne Medical School (or its successor), etc.]. The Bequest is to be known as The [insert name] Bequest.

3. Where a donor’s Will gives a fixed dollar amount to the University, the Will should state that the specified sum be adjusted for inflation. A sample inflation clause is included here:

The said pecuniary legacy is to be adjusted for inflation from the date of this Will to the date of my death according to the movement of the CPI between those two dates. CPI for the purposes of this Will means the Consumer Price Index All Groups, Weighted Average of Eight Capital Cities of Australia. If the CPI is no longer current at the date of my death and another index is then current, my Executor must compare the indices at the date of this Will to the date of my death and adjust the amount of the gift to take account of inflation.

These clauses are samples only and may not be suitable for the particular purpose under consideration. Donors should get their own independent legal advice regarding the specific terms of their Will. They should also contact the Gifts in Wills Team (hyperlink to Bequests team renamed as Gifts in Wills Team) if they wish to discuss a specific purpose for their gift.

Notes for solicitors/Will drafters

As the University is a charitable institution, there is no need for any gift in Will to the University to:

• state ‘… and I declare that the receipt of the Vice-Chancellor or other proper officer of the University will be a good and sufficient discharge to my trustees and that my trustees will not be obliged to see to the application of the gift’: see section 6 of the Charities Act 1978 (Victoria);
• specify in a donor’s Will a particular manner or form of investment for a bequest to the University, as section 40 of the University of Melbourne Act 2009 (Victoria) permits the University to invest endowment funds in the manner authorised by the Trustee Act 1958 (Victoria); and
• specify that, where a perpetual charitable trust is created, a portion of income be retained to protect against capital depreciation, as section 39(1) of the University of Melbourne Act 2009 (Victoria) permits the addition of a portion of income from an investment pool to be added to the capital of the pool ‘as a provision against depreciation or reduction in income’.