If Conditions A to D are met in relation to remuneration within subsection (1), P is entitled to receive the remuneration out of the funds of the charity.

• Condition A

  Condition A is that the amount or maximum amount of the remuneration—

  1. a

     is set out in an agreement in writing between the charity or its charity trustees (as the case may be) and P under which P is to provide the F4goods or services, or goods and services, in question to or on behalf of the charity, and

  2. b

     does not exceed what is reasonable in the circumstances for the provision by P of the F5goods or services, or goods and services, in question.

• Condition B

  Condition B is that, before entering into that agreement, the charity trustees decided that they were satisfied that it would be in the best interests of the charity for the F6goods or services, or goods and services, to be provided by P to or on behalf of the charity for the amount or maximum amount of remuneration set out in the agreement.

• Condition C

  Condition C is that if immediately after the agreement is entered into there is, in the case of the charity, more than one person who is a charity trustee and is—

  1. a

     a person in respect of whom an agreement within Condition A is in force,

  2. b

     a person who is entitled to receive remuneration out of the funds of the charity otherwise than by virtue of such an agreement, or

  3. c

     a person connected with a person falling within paragraph (a) or (b),

  the total number of them constitute a minority of the persons for the time being holding office as charity trustees of the charity.

• Condition D

  Condition D is that the trusts of the charity do not contain any express provision that prohibits P from receiving the remuneration.

This section does not apply to any remuneration for services provided by a person in the person’s capacity as a charity trustee or trustee for a charity or under a contract of employment.

Before entering into an agreement within Condition A the charity trustees must have regard to any guidance given by the Commission concerning the making of such agreements.

The duty of care in section 1(1) of the Trustee Act 2000 applies to a charity trustee when making such a decision as is mentioned in Condition B.

For the purposes of Condition C an agreement within Condition A is in force so long as any obligations under the agreement have not been fully discharged by a party to it.

Sections 187 and 188 (interpretation) apply for the purposes of this section.

The charity trustee or trustee for a charity is disqualified from acting as such in relation to any decision or other matter connected with the agreement.

But if an act is done by a person who is disqualified from doing it by virtue of subsection (2), the act is not invalid merely because of that disqualification.

An order under this subsection is one directing that P or (as the case may be) the connected person is not to be paid the whole or part of the remuneration mentioned in subsection (4)(b).

If the Commission makes an order under subsection (5) or (6), P or (as the case may be) the connected person accordingly ceases to have any entitlement under the agreement to so much of the remuneration (or its monetary value) as the order requires P to reimburse to the charity or (as the case may be) as it directs is not to be paid to P.

Sections 187 and 188 (interpretation) apply for the purposes of this section.

The condition in this subsection is that the Commission considers that it would be inequitable for the person not to be paid the remuneration or not to retain the benefit.

Sections 350 to 352 (meaning of child, spouse and civil partner, controlled institution and substantial interest) apply for the purposes of subsection (1).