Nondiversion of Charitable Property and Fundamental Changes
15 Pa.C.S. §5547(b) prohibits a non-profit corporation from diverting charitable property from the purposes for which it was given. The Orphans’ Court will rule on a petition from a non-profit corporation seeking confirmation that a proposed action does not constitute such a diversion. In addition, the Orphans’ Court may be asked to rule on a question under 15 Pa.C.S. §5550 concerning the effect of certain fundamental changes in the corporation on a gift to the corporation. The general rule concerning property rights of non-profit corporations after a merger are found at 15 Pa.C.S. §5929(b).
Additionally, in the case of health care non-profits, the Office of the Attorney General has promulgated a “Review Protocol For Fundamental Change Transactions Affecting Health Care Nonprofits,” which requires that certain information be provided to enable it to review fundamental corporate change transactions involving a transfer of ownership or control of charitable assets and determine how the public interest would be affected.

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