Title: Murphy v. Traylor

State: alabama

Issuer: Alabama Supreme Court

Document:

289 So. 2d 584 (1974)
Mary Jo MURPHY
v.
Herbert TRAYLOR et al.
SC 451.

Supreme Court of Alabama.
January 31, 1974.
Dillon, Kelley & Barnes, Alexander City, for appellant.
Howard & Dunn, Wetumpka, for appellees.
MERRILL, Justice.
This appeal is from a decree vesting title in Equality United Methodist Church, a corporation, to 2½ acres of land near the church.
The trustees of Equality Methodist Church and Equality United Methodist Church, a corporation, filed a declaratory judgment proceeding to establish the owner of the land in question.
Fred Raht Whitaker died testate on August 1, 1953. Under Paragraph 2 of his will, Whitaker provided that:
At the time of the death of Whitaker, the church was an unincorporated association. It was incorporated more than ten months prior to the trial.
The question presented to the trial court and here, on appeal, is whether the devise to the church is valid, inasmuch as the church was not incorporated when the testator died but was incorporated before the trial.
The pertinent part of the trial court's decree follows:
The appellant argues that an unincorporated religious society is without capacity to acquire or hold title to realty and cites McLean v. Church of God, 254 Ala. 134, 47 So. 2d 257, and other cases which so hold. In McLean, this court stated in part:
But this rule is not absolute. While this court has held that an unincorporated religious society cannot maintain an action in the nature of ejectment in the name of the society, Enterprise Lodge No. 352 v. First Baptist Church (Col.) of Evergreen, 288 Ala. 592, 264 So. 2d 153, it has also held that an unincorporated religious society can maintain a bill for injunction to require respondents to remove a fence on its property and from further trespassing on church property, Vaughn v. Pansey Friendship Primitive Baptist Church, 252 Ala. 439, 41 So. 2d 403; and that an incorporated church, by and through its trustees and deacons, can maintain a bill to quiet title to their church property, Hamner v. Carroll's Creek Baptist Church, 255 Ala. 277, 51 So. 2d 164, Ford v. Washington, 288 Ala. 194, 259 So. 2d 226. This court has also held that equity has power to compel specific performance of an agreement to convey land made to trustees of a religious society before it was incorporated, upon application of the church after it became incorporated. Gewin v. Mt. Pilgrim Baptist Church, 166 Ala. 345, 51 So. 947.
*586 In Hundley v. Collins, 131 Ala. 234, 32 So. 575, this court said:
This court has dealt with deeds to unincorporated religious societies several times. The author of McLean, 254 Ala. 134, 47 So. 2d 257 (1950), also authored Johnson v. Sweeney's Lane Church of God, 270 Ala. 260, 116 So. 2d 899 (1959). In the latter case, Delia V. Bowen deeded property to an unincorporated religious society, but which, as here, subsequently became incorporated, and this court quoted from Gewin v. Mt. Pilgrim Baptist Church, 166 Ala. 345, 51 So. 947:
This court also quoted from Hope of Alabama Lodge of Odd Fellows v. Chambless, 212 Ala. 444, 103 So. 54:
Then this court wrote:
All the justices concurred in the opinion in Johnson, and three of them had participated in the McLean decision. So, it appears that in equity this court does allow a conveyance to an unincorporated religious society to stand where the society is later incorporated in order to secure title to the property.
We fail to see any material distinction in a grant by deed and a devise by will in an attempt to convey property to an unincorporated religious society that is later incorporated. A deed is effective upon delivery and a will speaks as of the death of the testator. But if the grantor in a deed has named an improper grantee, he can redraft his deed, but the testator cannot redraft his will. And there are numerous instances where courts have upheld devises to people not then in esse. Here, the unincorporated church was in existence, the congregation occupies a building; it owns the church property, a parsonage and a cemetery, and it is the same church, incorporated, as it was unincorporated, and still a part of the North Alabama Conference, and the pastor is appointed by the bishop. Also, it was the unquestioned intention of the testator to convey the property to his church.
In MacGregor v. Commissioner of Corporations and Taxation, 327 Mass. 484, 99 N.E.2d 468, it was said:
In Frazier v. St. Luke's Church, 147 Pa. 256, 23 A. 442, the court said:
In Restatement, Second, Trust, § 397, Comment f, the rule as to a devise to an unincorporated charitable association is stated as follows:
In Schneider v. Kloepple, 270 Mo. 389, 193 S.W. 834, several Missouri cases are cited for the rule "since the corporate *588 character of the devisee is not necessary to the validity of a charitable devise" made to an unincorporated religious society.
The dissenting opinion cites Trustees of the Philadelphia Baptist Association v. Hart's Executors, 4 Wheat. (U.S.) 1, 4 L. Ed. 499 (1819). That case is cited in Carter v. Balfour, 19 Ala. 814 (1851), wherein this court cited cases where land was devised to unincorporated societies, and quoted a New York case, Potter v. Chapin (6 Paige 639), where the chancellor said of 4 Wheat. 1, "I believe that it is generally admitted that the decision in that case was wrong." Later in the opinion, Coleman, J., speaking for all the court except Chilton, J., who did not participate, stated: "I consider the above case from 4 Wheat, as partially, if not altogether overruled by the same court"; and he cites cases of the U.S. Supreme Court to support that statement. In 1882, in Russell v. Allen, 107 U.S. 163, 2 S. Ct. 327, 27 L. Ed. 397, the U.S. Supreme Court stated that the case of Baptist Association v. Hart, 4 Wheat. 1, "was decided upon an imperfect survey of the early English authorities, and upon the theory that the English law of charitable uses, which, it was admitted, would sustain the bequest, had its origin in the statute of Elizabeth, which had been repealed in Virginia. That theory has since, upon a more thorough examination of the precedents, been clearly shown to be erroneous." (Emphasis Supplied.)
We think it appropriate to note that it is general knowledge that in the organization of the United Methodist Church, title to real property is not in the local churches but in the respective Annual Conferences. In 1 Page on Wills, § 17.14, at 835, the author says:
The cases cited in support of the rule so hold. Had proof been made that the Annual Conference was incorporated or that it held title to the property of the local church, this would have been an additional reason for affirming the decree of the trial court.
Applying the rule of our cases heretofore cited, we hold (paraphrasing the language of Johnson, 270 Ala. 260, 116 So. 2d 899, and authorities cited therein), that the legal title to the property passed under the will to the incorporated church regardless of whether it was held in trust by the trustees of the church, individual members of the unincorporated church, or the next of kin of the testator, and passed to the church when it was incorporated.
Affirmed.
BLOODWORTH, MADDOX, McCALL and JONES, JJ., concur.
HEFLIN, C.J., concurs specially.
COLEMAN, HARWOOD and FAULKNER, JJ., dissent.
HEFLIN, Chief Justice (concurring in result):
I concur that this case should be affirmed, but for different reasons.
Appellant in this case relies on Title 61, Sections 4, 5, Code of Alabama, 1940, as amended (Recompiled 1958) and the long standing common law rule that an unincorporated association cannot hold title to real property, e. g., Enterprise Lodge No. 352 v. First Baptist Church (Col.) of Evergreen, 288 Ala. 592, 264 So. 2d 153 (1972). Section 4 provides as follows:
Section 5 states:
This court has gone so far as to hold that because of the common law disability of an unincorporated association to hold title to real property, a devise to such an association is void. McLean v. Church of God, 254 Ala. 134, 47 So. 2d 257 (1950).
The hub of Appellant's argument then is the above mentioned common law rule. Although this court has repeatedly intoned the rule over the years, little discussion of the reasons for maintaining such a rule can be found. Indeed, because of the realities of modern day conditions the courts of this country, including this court, have used many devices to avoid the operation of this ancient rule. For example, the prohibition is said to apply only to real and not personal property. See McLean v. Church of God, supra. And, in addition, this court has held that an unincorporated society may hold equitable title to real property under certain circumstances. See, e. g., Johnson v. Sweeney's Lane Church of God, 270 Ala. 260, 116 So. 2d 899 (1960).
The majority opinion in this case would carve out still another exception by permitting a devise of real property to be sustained under the theory that a charitable use should not fail for want of a trustee.
These inroads into the old rule are the result of a recognition by members of this court of the social necessity for some form of collective ownership by unicorporated organizations. The overall problem is well summarized by Professor Powell:
Note also that the legislature has moved to alleviate the unreality of the common law rule by enacting a simplified scheme whereby churches, educational or benevolent societies, etc. may incorporate, and upon completion of this incorporation, the association may "acquire, hold, administer, distribute or dispose of real or personal property . . ." See Title 10, Sections 124-132 Code of Alabama 1940, as amended (Recompiled 1958). Regardless of this simplified procedure, there remain in this state a large number of unincorporated associations, especially religious groups, which, for reasons of their own, have elected not to incorporate. Thus the problem of how best to fashion a rule of law which will fulfill the need for a form of collective ownership by unicorporated associations should be considered.
I feel that the ends of justice will best be served by a rule which permits unincorporated associations to acquire, hold and transfer property in their own name. I would hold that an unincorporated religious society does have the capacity to acquire real property by devise, and the instant case is due to be affirmed. Thus I would overrule McLean v. Church of God, supra, and other similar holdings.
It is realized that the promulgation of a new rule often leaves many questions unanswered. But there is a core of decisions in this state and decisions from other states which will serve as a basis for resolving problems as they arise. Perhaps the foremost problem likely to arise is how the rights of the church members will be protected in case of a schism or in case it becomes necessary or expedient to dispose of the property held.
As a starting point, the court has repeatedly held that while the powers of courts of this state may not be invoked in purely ecclesiastical matters, the courts of this state do have jurisdiction to act in church matters involving civil and property rights. See, e. g., Board of Incorporators of African Methodist Episcopal Church v. Gaston, D.C., 343 F. Supp. 823 (1972); Williams v. Jones, 258 Ala. 59, 61 So. 2d 101 (1952); United Baptist Church of Primitive Faith v. Gautney, 250 Ala. 216, 34 So. 2d 1 (1948). Furthermore, the conveyance of property held by trustees of an unincorporated association has long been under the watchful eye of the courts of equity, since as trustees of a passive trust, the trustees have no power to convey the property. Street v. Pitts, 238 Ala. 531, 192 So. 258 (1939). Thus it seems clear that the courts of this state have jurisdiction to settle controversies involving the conveyancing of property to and from unincorporated associations.
Although the court may not have the ability to predict every conceivable variation which may arise under the new rule, there are some generally established principles which will provide guidance.
In the usual situation, the persons who constitute an unincorporated association will have made some sort of agreement or will have established a constitution and by-laws for the government of the association. Unless justice and equity dictate otherwise, the actions of the duly constituted authorities, acting in accordance with its rules and regulations or under a mandate of the majority should be binding on the association. Naturally a corollary to this rule would be that if the constituted authorities act outside the scope of the conferred authority, the acts would not bind *591 the association. See Pallilla v. Galilee Baptist Church, 215 Ala. 667, 112 So. 134 (1927).
In the event the association has no written constitution or by-laws, absent a valid reason for not so doing, the court likely would adhere to the cases which hold that in democratic church organizations, the majority controls as a rule. See Gewin v. Mt. Pilgrim Baptist Church, 166 Ala. 345, 51 So. 947 (1910); Harris v. Cosby, 173 Ala. 81, 55 So. 231 (1911); Guin v. Johnson, 230 Ala. 427, 161 So. 810 (1935).
In the event of a schism, the law extant in this state both as to incorporated and unincorporated associations is essentially the same. The principle applied is well stated in Guin v. Johnson, supra:
Thus the court has held that when a religious society divides into two groups, one of which radically departs from fundamental ecclesiastical usages and principles which were accepted before the dispute arose, ordinary principles of majority rule do not apply, and the group adhering to such usages and principles is entitled to the church property. Holt v. Scott, 252 Ala. 579, 42 So. 2d 258 (1949). Although these rules are rooted in trust principles there appears to be no good reason why such rules should not be applied by a court of equity in a non-trust situation. Indeed in cases involving incorporated churches, the courts of equity of this state have not hesitated to assume jurisdiction, even though any passive trust would have been executed upon incorporation of the association. See Williams v. Jones, supra.
As a final note, it should be pointed out that authority also exists to resolve problems which arise in unincorporated associations which are less democratically organized that the "majority rule" associations mentioned above. In Davidson v. Church of Christ, 245 Ala. 203, 16 So. 2d 179 (1944), the appellants insisted that since the Church of Christ was congregational in its nature and creation, with no superior or directing power other than that found in the government of the church by its membership, express authority of the congregation, acting as such, is necessary to institute a suit in the church's name. The evidence was without conflict that the church in question has no written creed or discipline, but that the elders had been chosen by the customary manner of the church:
*592 The court went on to hold that there was sufficient evidence to support the church's insistence that the elders have authority to govern and control the temporal affairs of the church and the church property, and held that those who unite themselves to such an organization do so with an implied consent to that form of government and must submit to it.
In summary then, it appears that there is authority to guide the court in resolving problems of conveyancing to and from unincorporated associations.
Furthermore, it would seem that no private interests are protected and no compelling public policy is served by requiring that unincorporated associations hold real property through some trust arrangement. See generally, Comment, The Law of Trusts in Alabama, 25 Ala.L.Rev. 467, 492-59 (1973). On the other hand, the rule herein suggested would have the effect of fulfilling the reasonable intent and expectations of the average layman in this state when he attempts to transfer property, whether by deed or by will, to some unincorporated church group. Also, the rule should have a salutary effect on a long-recognized problem of clouds placed on titles to land because of conveyances of real property from unincorporated religious societies. See Worthy, The Acquisition and Alienation of Real Property By Religious Societies in Alabama, 15 Ala. Law 410 (1954).
Furthermore, the legislature has recognized that unincorporated associations are sufficiently recognizable entities so that they may sue and be sued in their own name. Title 7, Section 142-145, Code of Alabama 1940, as amended (Recompiled 1958). And note particularly Section 145 which states:
In conclusion, a comment by Professor Powell is again in order:
Thus, even though I would hold that an unincorporated religious association may take by devise, I would reserve judgment as to the capacity of other types of unincorporated associations until the arguments pro and con are heard.
FAULKNER, Justice (dissenting).
What the majority has done in this case is to call an end sweep when the game plan calls for a play up the middle. Whether an unincorporated association can hold title to real estate is still unsettled. A rose by any other name is still a rose. If the question of how a conveyance can be made from an unincorporated association were answered by the concurring opinion of the Chief Justice, I would be inclined to vote with him. But, that question is not answered. In most jurisdictions which permit unicorporated associations to hold title to real property, the title is vested in the members thereof jointly. Under that theory in our State each and every member and his or her spouse would have to join in the execution of a deed or mortgage. But, what happens when a member leaves or dies? Do his or her heirs and next of *593 kin have to be tracked down to get their signatures? And, suppose a member flatly refused to sign, could good and merchantable title be conveyed by the remaining members?
The majority holding that "the legal title to the property passed under the will to the incorporated church regardless of whether it was held in trust by the trustees of the church, individual members of the unincorporated church, or the next of kin of the testator, and passed to the church when it was incorporated" is reminiscent of two bird hunters. One had a steady aim, fired on a flushed covey and missed. The other was shaky with his gun, which wavered from side to side, up and down, and around in circles when he pointed it to a flushed covey. He fired and killed a bird. The one with the steady aim remarked to his friend, "You ought to have got one you shot everywhere." This story is told in good humor and not intended to reflect on the sincerity and integrity of the members of the majority.
Whether an unincorporated association which was subsequently incorporated was then capable of holding title to real estate was ruled upon by the Supreme Court of the United States in Trustees of the Philadelphia Baptist Association v. Hart's Executors, 4 Wheat. (U.S.) 1, 4 L. Ed. 499 (1819). The Court, by an opinion delivered by Chief Justice Marshall, held that the Baptist Association, not being incorporated at the testator's death, could not take title to the property given and bequeathed to it under the decedent's will.
Under the facts in this case the wife of Whitaker, upon his death, became the life tenant with remainder over to the Equality Methodist Church if it could take. As the life tenant she became the trustee for the remainderman. Amos v. Toolen, 232 Ala. 587, 168 So. 687 (1936); Durden v. Neighbors, 232 Ala. 496, 168 So. 887 (1936); Abney v. Abney, 182 Ala. 213, 62 So. 64 (1913). And, as trustee for the remainderman, the life tenant could not injure or dispose of the property to the injury of the remainderman. Durden v. Neighbors, supra; Abney, supra. By no act of the life tenant can the title of the remainderman be effected or destroyed. Hall v. Condon, 164 Ala. 393, 51 So. 20 (1909); McLeod v. Bishop, 110 Ala. 640, 20 So. 130 (1895).
The will read "in fee simple forever". Even though a life tenant holds in trust for the remainderman, there must be a remainderman capable of taking title to the real estate. Under Title 61, § 4, Code of Alabama 1940, Recompiled 1958, a devise of lands may be made to any person or corporation capable by law of holding real estate. Section 5 of this title provides that any interest in real estate devised to a person or corporation incapable of taking, descends as in case of intestacy. A will speaks from death and without consequences from subsequent events. Blakeney v. DuBose, 167 Ala. 627, 52 So. 746 (1910). Although the intent of the testator must be as fully carried out as legally possible, his will must meet the requirements of the law. Sanford v. Alabama Power Company, 256 Ala. 280, 54 So. 2d 562 (1951).
The majority does not answer the question as to ejectment by an unincorporated association. See Arnold v. Methodist Episcopal Church, 281 Ala. 297, 202 So. 2d 83 (1967); Vaughn v. Pansey Friendship Primitive Baptist Church, 252 Ala. 439, 41 So. 2d 403 (1949). If one has a piece of cake, he ought to have the right to eat it.
In answer to question of "reserving judgment as to other types of unincorporated associations" mentioned by the concurring opinion, I see no reason in the eyes of the law why they should be treated any differently from a religious society, so long as it is for a legal purpose.
I respectfully dissent.
HARWOOD, J., concurs in the result.