Court Opinion

ID: 6669499
Source: CourtListenerOpinion
Date Created: 2022-07-20 21:08:26.949011+00
Date Added: 2024-06-11T16:00:26.979266
License: Public Domain

Eccleston, J.,
delivered the opinion of this court.
The complainants in their bill rest their claim to a sale of the property, included in the deed of trust, upon two grounds:— 1st. That the corporation received large profits from which dividends, within the meaning of the deed, should have been paid to the certificate holders, but no such payments had been made. 2nd. That the sale of the property to Green, under the judgment; had rendered the corporation incapable of carrying out the purposes of the trust, and of performing the conditions which induced the contributions to be made.
' In argument, the first ground was not formally abandoned, but virtually so. As well it might, because the answers deny that any dividends had ever accrued, or become payable to the contributors under the deed. And there is no proof to sustain the allegation of the bill in this respect.
Neither can the second ground taken be sustained in our opinion. The answer of the corporation states, that “from 1836, or thereabout,” the buildings had been used, and, at the time of making the answer, were still being used by the corporation as a college for medical instruction, and as a hospital and lunatic asylum, and that moneys had been received by them, from time to time,'for such uses of the said buildings. In a subsequeñt part of the answer they admit their inability to pay their debts, but distinctly assert they had never failed to fulfil any of the requirements contained in the deed of trust, and that they were then in possession of the buildings erected for the purposes of the institution under the deed, and were using and employing them for the purposes contemplated by the deed and the parties thereto.
Green states in his answer, that the corporation occupied the buildings, as a medical school and hospital, from the time *407of their completion up to the sale made to him. But he denies that from such occupation any dividends, within the purport of the deed, ever became due and payable. He says nothing in regard to the possession or occupation of the buildings after he purchased them. The rendition of the judgment, and the sale to him under it, he admits, and then adds: “This respondent also submits, that for the reasons assigned by his co-defendants, in their answer, the said complainants have no right of redress.”
After such a reference to, and reliance upon, the grounds taken in the answer of the corporation to defeat the claim of the complainants, it cannot be supposed that the silence of Green, in reference to the possession or occupation and use of the buildings by the corporation, after the sale, as stated in their answer, was intended to contradict the statement on that subject made by them. And there is no proof in the cause tending to show, either that the corporation were not occupying the premises, as usual, after the sale and up to the time of making their answer, or that they were paying rent to Green for the same, other than the mere fact of the sale itself. But if the proof -was before us that the corporation were paying rent for the premises, it would only lessen their means of accumulating dividends for the contributors. We do not see, that whilst they continued to occupy the buildings for the very purposes contemplated by the deed, the sale of the buildings rendered the corporation so entirely incapable of performing the requirements of the trust, as to authorise a decree for a sale under ibis deed, which, to say the least of it, is not very explicit. There is no provision in it for a sale in case of failure to realize profits, out of which dividends were to he paid, but the sale is to be made on failure to pay dividends which have actually accrued and remain unpaid for a year. A sale, under the ciicumstances disclosed in the record, could not be claimed by virtue of any express provision in the deed. Nor would the principles of equity, applicable to such a case, authorise a sale, simply because, by virtue of the sale of the premises under the judgment,, the corporation were *408liable to be turned out of possession or to be compelled to pay rent; provided that at-the time the bill was filed they were still in possession of the property, and using it for the purposes contemplated by the deed. A state of things calculated, only, to reduce the means of producing dividends, but not, necessarily, to render the corporation entirely incapable of performing the duties required by the trust, could not entitle the appellees to a decree in their favor under the present proceedings.-
In this instrument there is no express authority, at least, in language plain and clear of doubt, to sell the trust property for the payment of the principal of the contributions. There is a provision, that if the dividends stipulated in and by the certificates to be paid, or any part of them, shall be in arrear and unpaid for a year, then the trustees may sell the property, and out of the proceeds of sale, after the payment of arrearages of rent, pay and reimburse the owners of the certificates the full amount of the principal of said certificates, and all dividends in arrear, and the residue, if any, to the corporation. A failure to pay dividends is the only event which, according to the express language of the deed, authorises a sale.
Among the recitals in the deed is one, that at any time after the 24th of July 1845, (ten years after the date of the instrument,) the corporation are to have the privilege of paying the principal to the certificate holders, in discharge of all claim under the trust. But it is nowhere said at what time the certificate holders may demand payment of the principal, except out of the proceeds of the property, when sold, in consequence of a failure to pay dividends. If, then, it should be held, that from the general scope and design of the deed, it is to be considered as intending to secure the ultimate payment of the principal, it was not contemplated that the same should be paid within ten years.
The deed clearly invests, for the period of ten years, at least, the contributions of the certificate holders, and inhibits the payment of the principal until the expiration of that time. The institution appears to be still in operation. This being *409so, arid there being no proof of profits out of which dividends eould alone be made, establishes, in any aspect of the' case, that the bill was filed too soon.
We do not wish to be understood as intimating, that had the ten years elapsed, or the purposes of the institution completely failed, the complainants would have been' able to maintain this proceeding. On that subject it is not necessary we should, at this time, pronounce any opinion. The decree will be reversed and the bill dismissed, with costs to the appellant.-

Decree reversed and bill dismissed¿