Court Opinion

ID: 7119996
Source: CourtListenerOpinion
Date Created: 2022-07-24 12:37:15.072117+00
Date Added: 2024-06-11T16:14:04.414491
License: Public Domain

Faville, J.
(dissenting.) I feel compelled to dissent from the opinion of the majority in this case. The case arises on demurrers to the petitions of the plaintiffs and the interveners.
It appears that, prior to 1881, an educational institution known as Western College had been located at the town of Western, in Linn County, Iowa. About 1881, Western College was removed from Western and “permanently” located at Toledo, Iowa. In 1902, the authorized officers of the college announced a plan for the raising of an endowment fund for such college, and published • a statement that the college would be given the name of anyone who would give the sum of $50,000 to said endowment fund. About a year after this written propo*1020sition bad been promulgated by the college, Mr. Leander Clark, a resident of Toledo, accepted the said offer of the college, said acceptance, containing a counter offer specifying the terms and conditions upon which he would pay to the college $50,000.
His said counter proposition was duly accepted by the proper officers of the college. It is unnecessary that I set out all of the written proposition of Leander Clark, as much of it is quoted in the majority opinion.
He .recited that he had had under consideration 1;he. offer of the college to give the name of the college to anyone who would contribute the sum of $50,000 to an endowment fund, and he said:
“I have concluded to accept the proposition made in your resolution above referred to and I hereby propose to lay the foundation for an endowment by making a donation of fifty thousand dollars ($50,000) on the terms and conditions following, to wit: * * *.”
Then followed certain conditions and provisions with regard to the payment of the $50,000, and said terms required .that the board of trustees of the college “shall then, by proper action made of • record, fully accept said donation of fifty thousand dollars ($50,000) with all the terms and conditions on which it is offered as herein expressed, and solemnly pledge the college to the strictest compliance with such conditions, forever.”
One of the conditions was that the name of the college should be changed to “Leander Clark College,” and that such change should be made by proper amendment of its articles of incorporation, “and forever thereafter the college shall be known as Leander Clark College.”
Another of the conditions was that an additional sum of $100,000 should be raised by the college, and that said sum, together with the $50,000 paid by Mr. Clark, “shall constitute a permanent endowment fund, the principal of which shall be protected and forever held sacred as such.”
The college officers duly accepted all of the terms and conditions of this offer, as made by Leander Clark. The fund of $100,000 was raised, and Leander Clark paid over the sum of $50,000, in accordance with said agreement. The articles of incorporation of the college were changed, as specified by Mr. *1021Clark, and the college was named Leander Clark College, and continued to operate as such. In all of these proceedings the college is repeatedly referred to as being located at Toledo, Iowa.
The petitions and amendments thereto in question allege that Leander Clark College and its board of trustees have now made arrangements to merge and consolidate said college with Coe College, a corporation organized under the laws of Iowa and located at Cedar .Rapids, Iowa, and to transfer and set over the said endowment fund, including the said $50,000 so paid by Leander Clark, to said Coe College, and have liquidated and permanently closed up the affairs of the said Leander Clark College and transferred said fund and the income derived therefrom to said Coe College, and that Leander Clark College has ceased to exist.
The plaintiffs, as trustees of the estate of Leander Clark, and the interveners, as beneficiaries under his will, seek to recover the said sum of $50,000 so paid to Leander Clark College under said arrangement.
I do not construe this transaction as being a gift or donation by Leander Clark to general educational purposes, and I do not think the cy-pres doctrine has any application whatever to the facts in this case. As I view it, Leander Clark entered into a valid, binding, and enforeible contract with the college, based upon an adequate and sufficient consideration. The primary and essential elements of a contract are all present here. Leander’ Clark made a written offer to the college. This offer was to pay a certain sum of money to said college, on condition that the said college do certain things. This offer of Mr. Clark’s was duly accepted, and a binding contract was made. The essential requirements of the contract were, on the part of Mr. Clark, that he should pay to the college the sum of $50,000; on the part of the college, they were that the name of the institution should be changed from Western College to Leander Clark College, and that the college should be bound by said contract “to the strictest’compliance” with the conditions imposed, “forever.” The college expressly agreed by said contract that the said sum of $50,000 (together with $100,000 more) sho.uld be “forever held sacred,” and that the income therefrom should be used as a “faculty fund only: that is, for *1022the payment oí president and teachers; and no part shall be diverted to any other use or purposes.”
As I view it, this was nothing’ more nor less than a valid, binding, and enforcible contract, entered into between the parties, which was performed on.the part of Mr. Clark, and which was necessarily executory as to the college. It required the colleg’e to change its name to Leander Clark College, and to maintain the same with “strictest compliance, forever;” it required that the fund should be “forever held sacred” as such; it specified the definite purpose for which the income therefrom could be used; and provided that “no part shall be diverted to any other use or purpose.” This was a continuing obligation on the part of the college; and I must confess that I am at loss to see any legal basis upon which the college had a right to violate the terms and conditions of the contract on its part, not only in one particular but in every particular. As I view it, the college, has breached every obligation of this contract. It is not maintaining the name of Leander Clark in this educational institution “forever,” but has abandoned it entirely; it is not using the income from this $50,000 to pay the faculty of Leander Clark College; it is not holding this $50,000 as a fund which is not to be diverted or used for any other purpose than to support Leander Clark College.
Let us suppose that, the very next day after the college had duly accepted Mr. Clark’s offer and had received his money, it had proceeded at once to do the very things it has now done; suppose that, immediately after he had turned over this $50,000, the officers of said institution had changed the name from Leander Clark College back to Western College; or suppose that they had at once decided to abandon the college as an educational institution, and turn this fund over to another educational institution located at some distant point. Would anyone seriously contend that Leander Clark could not, at such time, have maintained an action for the breach of said contract? If so, then it makes no difference that a number of years elapsed before the college breached its contract; nor do I think it makes any difference that in the meantime Mr. Clark has died. It was an executory contract, so far as .the college was concerned, which of necessity contemplated the death of *1023Mr. Clark: in fact, be expressly provided in bis offer that, in the event of his death, his heirs and trustees should perform the contract on his part.
I do not care to enter into the discussion of the interesting question as to how far we have recognized the application of the cy-pres doctrine in this state. In any event, I think it has no application whatever to the instant case. Mr. Clark was not giving a general donation to the cause of education that was to be carried out, if need be, by the application of the cy-pres doctrine. He did no such thing. He made a specific and definite written contract with a duly organized corporation, with power to act. By said contract, he bound himself to do certain things; and by said contract, the corporation bound itself to do certain things. The contract was regular in every respect. Mr. Clark performed the contract on his part; the corporation has breached the contract on its part. By the very terms of the contract, the money was paid upon “conditions” which the college bound itself to carry out with the “strictest compliance,” “forever.” It has not carried out these conditions. It has breaehed^and violated them. It is not at all a question of good faith on the part of the officers of Leander Clark College. No one impeaches their good faith in this transaction. No one questions that possibly the $50,000 can be used to far greater advantage in furthering the general cause of Christian education if turned over to Coe College, or some other larger institution, than if retained by Leander Clark College. It is not a question at all, in my judgment, of whether a greater good may be accomplished by turning the fund over to Coe College. Good faith, a lofty purpose, and a conscientious desire to further the cause of Christian education are in no way involved here. I view this simply as a question of the breach of a contract between two parties. Whether it was capricious or unreasonable on the part of Mr. Clark to require the terms and conditions he desired to be incorporated in the contract, is immaterial to our inquiry. He had a right to make such a contract; he had a legal right to pay $50,000 to have an institution bear his name as a monument and to be preserved “as a sacred trust” “forever.” He had a right to require that this money should not be diverted to any other purpose, and he had a right to *1024specify that its income should be used to pay the salaries of the faculty -of Leander Clark College. On the other hand, the corporation, created as a-legal entity under the laws of this state, had a perfect rig'kt to enter into this contract; and, as I view it, it has no more right to breach such a contract than would any individual. It fully and specifically agreed with Mr. Clark that it would do certain things for a valuable consideration. It has breached the contract on its part, and must respond for its failure to fulfill its contract, the same as any individual would do under a similar situation. I eann'ot interpret this arrangement between Leander Clark and the college as being anything more or less than a simple contract, which has been performed by one party and breached by the other. If there can be no redress and no relief under such conditions, then the law of contracts is very, impotent indeed.
It is suggested in the majority 'opinion that there is no forfeiture clause in the contract, no provision for reversion, and no condition subsequent. I concede that the contract does not, by its express terms, provide for a reversion or forfeiture in the event that the same be breached. I also concede that t|iere was no condition subsequent named in the contract that in terms pro: vidcd the remedy available if the contract should be breached; but I do not regard these as essential to the. right to maintain this action against the college for breach of its contract. The law is not so helpless that it cannot give to a party a remedy for a breach of the terms of an executory contract of this character. It was not incumbent upon Mr. Clark to provide by the contract that he should have his money back if the college breached the terms and conditions of the contract. The law supplies the remedy where the contract is silent on the subject-matter.
I think it sufficiently appears from the petition that the plaintiffs and interveners stand in the shoes of Leander Clark, and are entitled to the remedies available to him had he still been living, and are'entitled to maintain this action in the manner in which it was brought, to recover for the breach of the contract on the part of the defendants.
The questions which I have discussed, it seems to me, are too -elementary to require citation of authorities. As I view *1025it, it is largely a matter of tbe construction to be placed upon the transactions between Mr. Clark and the college. I think these transactions, when properly construed, constitute a valid, binding, and enforcible contract, which has been fully performed on the part of Mr. Clark, and which, according to the allegations of the petitions, has .been breached on the part of the defendants.
I cannot acquiesce in the pronouncement of the majority that “it seems to us clear that the dominant purpose of Leander Clark -was to establish a perpetual and charitable trust for the aid and support of Christian education.” As I view it, he did no such thing. He entered into a perfectly proper and legal contract that he would pay a certain sum of money to a certain corporation for a certain purpose, and the corporation agreed with him that, in consideration of his paying said sum, the spécified purpose would be carried out and performed. If Mr. Clark’s purpose was to make a gift of $50,000 “as a perpetual and charitable trust for the aid and support of Christian education,” then this money can be transported to Hong Kong or “darkest Africa” for educational purposes, and the name of Leander Clark can be utterly abandoned; and if that can be done now, it could have been done the very next day after the college received the money.
Mr. Clark’s purpose was clearly defined in his proposition to the college. It was not to help the cause of Christian education by turning over a trust fund to certain trustees to administer for said genéral purpose. The statements in his offer to the college, in my judgment, negative any such idea. I do not think he ever dreamed of such a thing. He was dealing with a local corporation, with the twofold purpose of helping an educational institution in which he was interested and of perpetuating his name as a monument among the people where-he lived. He was not making a gift or donation for educational purposes generally. I think it violates the very terms and provisions of the offer and acceptance which make up this contract, to so hold.
I shall not attempt to review the authorities. Nothing in our decisions in any way contravenes the view I have expressed herein. The case of Curtis & Barker v. Central Univ. of Iowa, 188 Iowa 300, recognizes that educational institutions are liable *1026under contracts, tbe same as other corporations or individuals. Such is and should be the law.
Of the right of the appellants to maintain this action, I have no doubt. The majority do not question such right. '
I think the action of the trial court in sustaining the de- ' murrers to the petitions of plaintiffs and interveners was erroneous. I would reverse.
De Graef, J., joins in this dissent.