I too was surprised that this facility was available (or had been so technically up until 20 odd years ago) to the courts. What a great little remedy available to judges when dispensing justice! What a shame it has been ruled no longer legally possible. It certainly hasn't been part of the New Zealand justice framework, more's the pity!
James, some questions:
Was this confined to Victoria or was a commonwealth wide practice?
Was the Melbourne CC simply looking to get its (grubby little?) hands on the money that was being diverted to charities in this way and not into their coffers ..... or is there an anti-Christian agenda behind it?
Is there any likelihood of a groundswell from the social services / charitable sector pushing for the law to amended to reinstate this as a legal avenue?