Adams v. Swig

• Decision Date: 26 January 1920
• Citation: 234 Mass. 584,125 N.E. 857
• Parties: ADAMS v. SWIG et al.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

234 Mass. 584

125 N.E. 857

ADAMS

v.SWIG et al.

Supreme Judicial Court of Massachusetts, Suffolk.

Jan. 26, 1920.

Appeal from Municipal Court of Boston, Appellate Division.

Action by Forrest N. Adams against Simon Swig and others, trustees of the National Realty Company, resulting in finding for plaintiff, the case being reported to the appellate division of the municipal court of the city of Boston, which dismissed the report, and defendants appeal. Order dismissing report reversed.

The agreement of trust creating the voluntary association on whose behalf defendants signed the note in suit as trustees, read as follows:

Agreement and declaration of trust made this thirteenth day of February, 1912, by Robert Luce of Somerville, Mass., Simon Swig of Taunton, Mass., Robert O. Harris of E. Bridgewater, Mass., Edward L. McManus of Natick, Mass., and Louis Goldstein of Boston, Mass., Trustees:

We, the subscribers, hereby agree to and with each other, in consideration of mutual agreements as follows:

(Hereinafter appears a list of the names of the various subscribers, including the name of the plaintiff and those of the various defendants.)

A capital shall be accumulated by fixed monthly payments to be paid as hereinafter provided. The beneficial interest in such capital and in the property acquired hereunder is divided into shares owned at the signing hereof as follows: [Omitted here.]

That the title of the trustees and of their successors as trustees under this instrument shall be National Realty Co. and that any property or properties conveyed or sold to them or their successors in this trust, under that description shall be held by them in trust under this instrument.

That the trustees hereunto shall have authority to issue notes or bonds, to secure the payment of the same by mortgage of the whole or of any part of the trust property.

That the trustees shall have authority to borrow money for temporary purposes giving therefor notes, signed by them in their capacity as trustees.

That the trustees hereunder shall invest such part of the capital and the profits thereon and the proceeds of the sale of bonds and notes herein provided for, as to them may seem desirable in such real estate, equities in real estate, and mortgages of real estate in Boston and its suburbs and in such other places as the said trustees by unanimous vote may deem advisable.

That the trustees hereunder shall hold the legal title to all property of said National Realty Co. and shall have as trustees the exclusive management and control of said property as if the absolute owners thereof, and are hereby given full power to do all things and perform all acts which in their judgment are necessary and proper for the protection of the said trust property and for the interest of the certificate holders hereunder in the property of said trust, subject nevertheless in all cases to the restrictions, terms and conditions herein set forth.

That without prejudice to the general powers conferred on the trustees hereunder by the last proceeding section, it is hereby expressly declared that the said trustees shall have the following powers, that is to say: (a) To purchase any real property for the National Realty Co. upon these same trusts, at such time or times and on such terms as to them may seem advisable, to assume mortgages upon said property and all without the consent written or oral of the certificate holders hereunder, or any of them, or of the board of directors hereunder or of any director thereof. (b) To sell at public action or private sale, to barter, to exchange, or to dispose of otherwise, any part, or the whole of the trust property which may, from time to time form part of the trust estate and discharged from all trusts at such time or times during the continuance of said National Realty Co. subject to such restriction and agreements for such price or consideration for cash or for credit and generally upon such terms and conditions as to them may seem judicious without the consent, written or oral of the certificate holders hereunder, or of any of them or of the board of directors hereunder, or of any director thereof, to secure payment upon any loan or loans of said trust, by mortgage with or without power of sale, and to include therein, such provisions, terms and conditions as to them may seem desirable without the consent written or oral of the certificate holders hereunder, or of any of them or of the board of directors hereunder or of any director thereof. (c) To rent or to lease the whole or any part of the property of said National Realty Co. for long or short terms, but not for terms exceeding the term of the trust, them remaining, provided that the said trustees may nevertheless, in any case rent or lease the said property for the term of a year or any part thereof. (d) To repair, alter, tear down, add to or erect any building or buildings upon land belonging to the said National Realty Co. to fill, grade, drain, improve and otherwise develop any land belonging to said trust; to carry on, operate or manage any building, apartment house, or hotel belonging to said trust. (c) To make, execute, acknowledge and deliver all deeds, releases, mortgages, leases, contracts, agreements, instruments and other obligations of whatsoever nature they may be relating to the trust property hereunder and generally to have full power in the premises to do all things and perform all acts necessary to make said instruments proper and legal. (f) To collect all notes, obligations, dividends and all other payments of whatsoever nature that may be due and payable to said National Realty Co. to deposit the proceeds thereof, as well as any other moneys from whatsoever source they may be derived, in any suitable bank or banks, or other depository, and to draw the same from time to time for the purpose herein provided. (g) To pay all lawful taxes and assessments and the necessary expenses of said National Realty Co., to employ such officers, brokers, engineers, architects, carpenters, contractors, agents, counsel and such other persons as to them may seem expedient, to designate their duties and fix their compensation; to fix a reasonable compensation for their own services to said trust, as organizers thereof, as well as to fix a reasonable compensation from time to time for their personal services as trustees thereof, and to pay themselves for said services. (h) To represent said National Realty Co. and the certificate holders thereof in all suits and legal preceedings relating to the property of said trust in any court or courts of law or equity, or before any other bodies or tribunals; to begin suits and to prosecute them to final judgment or decree; to compromise claims or suits, and to submit the same to arbitration when, in their judgment necessary or proper. (i) To perform all agreements made incumbent upon them by the deeds of any property which they may acquire pursuant to the provisions of this trust.

That the trustees hereunder shall have no power to bind the shareholders hereunder personally and in every written contract they may enter into, reference shall be made to this declaration; and any person or corporations contracting with the said trustees as well as any beneficiary hereunder shall look to the funds and property of said National Realty Co. for the payments under such contract, or for the payment of any debt, mortgage, judgment or decree or for any money that may otherwise become due or payable whether by reason of failure of the said trustees to perform the contract, or for any other reason and neither the said trustees nor the said certificate holders shall be liable personally therefor.

It shall be the duty of the trustees of said National Realty Co. in addition to the other duties herein imposed upon them: (a) To keep a careful and complete record of all the issues or shares of beneficial interest in the property of said trust with the name and residence of the person or persons to whom shares are issued, the date of issue and such other items as they may deem of importance or as may be required by the certificate holders hereunder and also a transfer book in which all transfers of said shares shall be recorded. (b) To keep careful and accurate books showing the receipt and disbursement of said trust and also the property of said trust, and also such other items as they may deem of importance or as the certificate holders hereunder may require. (c) To keep books of said trust open to the inspection of the said certificate holders at such reasonable times at the main office of said trust as they may appoint. (d) To furnish the said certificate holders at special meetings at which it shall be requested a careful, accurate written report of their transactions as trustees hereunder, of the financial standing of said trust, and of such other information concerning the affairs of said trust as they shall request.

That the trustees of said National Realty Co. and their successors hereunder as trustees shall not, at any time be required to give a bond, and each trustee hereunder shall be liable only for his own acts, and then only for the result of his own gross negligence or bad faith.

That the shareholders hereunder shall have no power to remove a trustee of said National Realty Co. from their office and to appoint a successor to him, but any certificate holder desiring to have a trustee hereunder removed shall have his recourse to any proper court of law or equity within said commonwealth.

That any trustee hereunder may resign his office at any special meeting of the certificate holders of said National Realty Co. the purpose of said meeting having been stated in the call thereof, and immediately thereafter and at the same meeting the said certificate holders shall proceed to elect by majority vote a new trustee to take the place of the trustee who had resigned but said resignation shall not take effect until a...