Court Opinion

ID: 6575059
Source: CourtListenerOpinion
Date Created: 2022-07-20 19:33:29.054041+00
Date Added: 2024-06-11T15:57:03.630033
License: Public Domain

Williams, Ch. J.
The plaintiffs seek, by their bill, to procure the interposition of this court, to prevent the destruction of a fund for the support of the ministry in the society, which, they claim, is about to be done, by returning the money subscribed for that purpose to the subscribers and their representatives. The defendants claim, that the society have a right to return the money subscribed for this purpose, when they think it is no longer necessary or useful to the society; and also, that the facts stated in the bill do not warrant the interposition of a court of chancery.
The first ^objection to this bill, i?, that it does not shew, by proper averments, that the fund was accepted, by the society.
It is said, no vote is stated, nor the time of acceptance, unless by the vague allegation that it was in a reasonable time.
The bill alleges, that the plaintiffs and ethers, being anxious to promote the welfare of the society, by raising and perpetu-*122atmg a fund for the support of the gtfepel ministry in the soci-et v did un¡te jn and subscribe an agreement, which is set out at large, with the sums subscribed by each person ; by which, say, they became obligated to pay the same according to the tenor of said writing: further alleging, that said society did, within a reasonable time thereafter, accept said fund, according to the articles of said constitution or writing ; and that the fund, according to the terms of the constitution, was transferred to, and committed into, the especial trust and management of said society, and has so ever since remained, and now amounts to the sum of 4960 dollars ; and a part has been vested in Phoenix bank stock, in the name of a committee of said society, and the balance has been loaned by said society.
The objection is, that the vote of acceptance and the time are not shewn. If a vote of the society was necessary to prove an acceptance, it is only evidence of it, and of course, need not be pleaded. The fact of acceptance is alleged ; and that is sufficient. Under that allegation a vote may be shewn as evidence of such acceptance. And if it is not necessary to set forth a vote in the bill, it would seem unnecessary to allege any specific time of acceptance ; as by the constitution of the subscribers, no time was fixed in which it must be done, but merely that after it was done, the whole management should be transferred to the society. At all events, if the society did, within a reasonable time, accept the special trust and management of this fund, and have actually received the avails, it would require some authority to prove, that because the precise time of such acceptance could not be, or was not, pointed out, therefore they could not be called to account for an attempt to misapply it.
The next objection is, that if any obligation rests upon the society, it is created by a contract arising by implication of law from the facts stated ; and that such contract is not alleged in this bill, but only the evidence of it. A little attention to this bill will shew what foundation there is for this objection. The bill states the object of the subscribers to be a permanent fund for the support of the ministry. It then shews the constitution or agreement for the regulation and disposition of said fund; and that the fund has been transferred to, and received and is now held by, the society, “ according to the terms and conditions, and for the purposes, specified in said subscription *123paper or constitution and then alleges, that the sociefy are about to violate those conditions, and claims the protection the court. It would seem that the rights of the plaintiffs were here clearly, though concisely stated, with the obligation the defendants, and their attempt to violate them. 2 Sw. Dig. 203. Milf. Pl. 40. Botsford v. Beers, 11 Conn. Rep. 370. 374.
We come, then, to the merits of the case.
The plaintiffs claim, that this fund in the hands of the defendants, is in the nature of a trust fund, to be held, by the society, for the uses and purposes for which it was originally destined, forever. The defendants, on the other hand, claim, that this was a donation to the society, which they had a right to accept or not, and which they may keep or return at pleasure : that when they become rich and do not need it; or when, in their opinion, it does not promote the peace and welfare of the society, or the objects originally intended ; the society may return it to the donors : that the subscribers gave up their respective individual interests to the society, who, being a corporation, may act by a major vote.
If this fund was a donation to the society, as is claimed, without restriction or condition, the society might return it to the donors, or use it for any other purpose to which they might apply any other property of the corporation. But if it was to be held, as the bill alleges, according to the terms and conditions of the constitution adopted by the subscribers, we must resort to that instrument to determine what are the powers and duties of the society. It shews, that the subscribers, being desirous to promote the welfare of the community, and being reminded that funds were among the best means of promoting that object, and being of opinion that a fund safely deposited for the purpose of defraying the annual expenses of the society to which they belonged, or some part thereof, would be of great benefit to themselves and their posterity, covenanted, among other things, that the money subscribed should be a permanent fund for the support of the gospel ministry in the present congregational society in Plymouth; that the interest should be so applied; that until the subscriptions were due, the business of the fund should be conducted, by a committee of the subscribers chosen annually; and afterwards, the whole management should be transferred to the society. The object *124íq view was the welfare of this community ; which, they sup-would be advanced, by a permanent fund for the sup-p0l-{ 0f the ministry; and that it might be permanent, it was that jt should be placed in the hands of persons chosen by the subscribers, to be vested in such a manner as might be most secure and permanent. They intended, then, to establish a permanent fund, not for fhe benefit of this generation merely, but for the benefit of their own families and those who should come after them. Ii was first to be placed in the hands of a committee elected by the subscribers ; which committee had no more beneficial interest in it than any other subscribers. They held it merely to carry into effect the object the subscribers had in view. This committee, then, were merely the agents or trustees of the subscribers, holding these funds to the use and for the purpose designated in the instrument they called a constitution, and could appropriate them to no other objects. But as this committee were to be chosen annually, by the subscribers, who would continually diminish until none remained, it was desirable that this care should devolve upon a more permanent body. It was therefore provided, that after the subscriptions all became due, the whole management should be transferred to the society. The society then were substituted for the former committee; and were to have the powers and perform the duties first imposed upon this committee. If the committee, to whom was first confided the management of this fu-ad, did not thereby become owners of that fund, and could not dispose of it at their pleasure, it is necessary to see how the society, their successois, became the owners, or could dispose of it at their pleasure. The management was confided to each in turn, and nothing but the management : the disposition of the fund was made by the subscribers themselves, and left no discretion to those whom they appointed managers.
It is said, it was given for the benefit of the corporate body ; and so they had the legal and the beneficial interest. But was it intended for the benefit of the corporation, as such ; or for the good of the individuals composing it or connected with it? In our pecuniary corporations the legal estate is in the corporate body ; but they hold it for the benefit of the individual stockholders. The corporate body has not all power, and may do acts to the injury of individual stockholders; and if it does, & eourt of chancery will restrain it.
*125This corporation having accepted the fund, accepted it, of course, subject to the terms and conditions which the donors had prescribed, viz. that it should be permanent; and that it should be appropriated for the uses and purposes intended. And the present managers can have no more right to vary the designation of the money, than the committee originally appointed. Both were the depositaries, not the donees, of the money. The constitution agreed upon, by the subscribers, is as much the rule of action for those who hold the funds given under it, as the constitution of the state is the rule by which the destination of the school fund is secured for the use of common schools. The donors part with their money, upon certain terms and conditions; and those who received it, received it subject to those terms and conditions, and those ordy. They now indeed say, that those terms and conditions have become ill adapted to the circumstances of the society ; that the fund is actually hurtful; and that the subscribers cannot complain, if they receive back their own money. How far the opinion of one hundred and twenty members out of two hundred and twenty-five, 'would go to prove that the fund was useless, is a question not now necessary to settle. But it is important to know where the society obtained the pow’er claimed. If they were mere donees of the subscribers, and their corporate powers were unlimited, they might possess it. But if the society are mere trustees, or in the nature of trustees, they can have no more right to destroy the trust fund, even by returning the property to the original owners, than other trustees. This mode effects as complete a destruction of the fund as any other ; and although it is more just, if the fund is to be destroyed, than any other disposition of it, it remains to be proved that they have the power to destroy it. If an annuity is left by A to B, for the use of C, B cannot return it to A or his heirs, because C has received an immense estate from another source, or because he expends it in low and vicious indulgences.
It seems to be claimed, that this is done with the consent of the cestui que trusts themselves. But the corporate body) a being without a soul, is not the cestui que trust. The object of the subscribers w’as, to confer a benefit on themselves and their children, on each individual member of the society and their posterity, so far as they should remain within the influence of the gospel as there dispensed. Nay further ; if, as the *126father of our country has said, religion and virtue are the pil-jarg 0f gocje^ every person living in the vicinity might have some interest in the support of the gospel in that place ; and might be considered as in some measure interested in the continuance or destruction of this fund. If so, it must follow, that the corporate body could have no right to annihilate it at their pleasure.
It is asked, shall the plaintiffs complain that their own money is to be returned to them? The plaintiffs represent themselves and others interested in the fund ; and complain, not merely that their own money is to be forced back upon them, but they are to be deprived of the stipulated benefit of the money of others. They also complain, that there was a solemn contract entered into, by which it was stipulated, that if one of the parties would pay a certain sum, others would also contribute certain sums for an important common object; after which no one had a right to withdraw what he had appropriated, without the consent of all; and he who put in the smallest sum, had no more right than he who subscribed the largest; nor would it give the right because he consented that others should do so too. As the consent of all was necessary to make the contract originally, the consent of all must be necessary to dissolve it; and the court cannot go into the enqui-ry whether the minority are not as much benefitted, by having their money returned, as by having it used in the manner agreed upon ; and if the fund was productive only of evil, as was claimed by one of the counsel, still a part of those interested could not vacate the bargain. Could such a state of facts be proved, it is not necessary to say there could be no remedy. But certainly the individual, whether a natural person or a corporation, who is in the situation of a trustee, although he may have some beneficial interest, is not constituted an umpire to decide this question. A corporation has power, by the vote of a majority, to decide upon all subjects over which they have controul; but they are persons of limited capacities, and when they attempt what is beyond their power, their vote can have no more effect in court, than it is entitled to, by the reasons which produced it. The defendants, then, must shew, that they, as a corporation, possess a power, which the committee in whose hands these funds were first placed had not, before their vote can be obligatory upon all persons interested there*127in ; or that the reasons for that vote are such as will satisfy a court of chancery, that the act done is in itself proper. The court is not satisfied, that they had any such power; and no facts have been shewn tending to prove, that the fund is less or injurious. But even were it so, no authority has been produced, to shew, that after such a trust has been accepted, the trustee or those who stand in that relation, can not only relinquish the burthen, but can, at pleasure, annihilate the fund. The authorities, as we think, teach a different doctrine.
In the case of The Attorney General v. Christ's Hospital, 3 Bro. Ch. Rep. 165. 1 Russ. Sp Myl. 626. where an annual sum of 4001. was given for the support of six poor children, and in case and as often as the governor of the hospital should refuse or neglect to take in and maintain the number, the money was to be applied to support the same number in such other school or manner as bis executor or the corporation should see fit; it was held, that the defendants having once accepted the legacy, they were forever bound by the condition, whether the receipts were sufficient or not; although it was contended, that the testator never could have intended to encumber the institution, by the legacy he gave to it. It was there said, as it has been here, shall the defendants be compelled to remain holders of this fund contrary to their mind and will? But if they are trustees, or stand in the relation of trustees, they certainly cannot change that relation at pleasure. No rule is better settled than that trustees cannot, without consent of the cestui que trust or a court of chancery, change that relation at pleasure, or discharge themselves of the trust, or “ denude” themselves of the trust, as it is sometimes expressed. Chalmer v. Bradley, 1 Jac. & Walk. 68. Shepherd v. McEvers, 4 Johns. Ch. Rep. 136. And this court has decided, that where moneys were given to a society to belong to them to support a free school in the centre district; and the society, instead of applying it for that purpose, made an agreement with the heirs of the testator, by which they were to receive a certain part of the money and apply it to the support of the gospel; such an attempt to divert this fund from the object of the testator, was fraudulent and void. Bailey & al. v. Lewis & al. 3 Day, 450. 464. In that case, the fund was given to, and to belong to, the society; but it *128was for a certain object; and the court did not enquire whether a free school was wanted or not, whether the society was unanimous or not, but merely, what was the object for which .it was given by him who had the power of designating the object.
But we need no authority but that of cur statute. An ancient enactment, still in force, has provided, that when lands, money or other estate are given or sequestered for the use and support of the ministry in any society or congregation in this state, the society may appoint a committee, who shall have power to demand, recover, and receive and take care of all such lands, money or estate for the use of the ministry, according to the true intent of such grant, donation and sequestration. Stat. 435. tit. 94. s. 11. The society, therefore, had nothing to do but to follow the true intent of the subscribers; and the moment they deviated from it, they deviated from the letter of the statute, as well as from the constitution of the subscribers. A return of the money subscribed was no more within the contemplation of those wTho signed the constitution for a fund, when it was committed to this corporation, than the arrangement made by the society and the heirs was in view of the testator, in the case of Bailey v. Lewis; and there is no more apology for a violation of that intent, in this case, than in that. The society of Plymouth, therefore, when they passed the vote complained of, attempted an act which was to nullify the sequestration of this property, and destroy the very object in view, when the subscribers pledged their faith to each other. Such an attempt is contrary to all the principles which regulate courts of chancery upon such subjects, and in face of our statute, and cannot be countenanced by this court.
If any reasons existed why this fund should be broken up, or the society should no longer remain managers of it, application should have been made to a court of chancery, who would have given such direction as would have comported with the safety of the fund, and its faithful appropriation, and the convenience of the society.
The superior court is advised to overrule the demurrer.
In this opinion the other Judges concurred.
Demurrer overruled.