Briggs v. Merchants Nat. Bank of Boston
| Decision Date | 01 October 1948 |
| Citation | 323 Mass. 261,81 N.E.2d 827 |
| Court | United States State Supreme Judicial Court of Massachusetts Supreme Court |
| Parties | CHARLES V. BRIGGS & others v. THE MERCHANTS NATIONAL BANK OF BOSTON, trustee, & others. |
May 5, 1948.
Present: QUA, C.
J., LUMMUS, DOLAN & WILLIAMS, JJ.
Charity. Trust Charitable trust; Application of trust property; Express trust: construction.
Lincoln. Municipal Corporations, Trusts, Officers and agents. Corporation Charitable corporation. Constitutional Law, Obligation of contracts, Charity. Equity Jurisdiction, Charity. Equity Pleading and Practice, Decree. Words, "Deficiency.
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A conveyance in trust to the town of Lincoln of a tract of land therein with the buildings thereon and an art collection housed in the buildings to hold and maintain as a public park and museum for the benefit of the town's inhabitants, and provisions in the grantor's will establishing trusts in furtherance of such park and museum and recreational and educational activities incidental thereto, created public charitable trusts whose benefits the town could accept whether or not it could expend its own tax-raised money for such purposes.
There was a proper case for the application of the doctrine of cy pres where it appeared that the dominant purpose of a donor by deed and by will was to establish a tract of land in the town of Lincoln and the buildings thereon and an art collection housed in the buildings as a public park and museum for the benefit of the inhabitants of Lincoln, but that that dominant purpose had not been accomplished and would not be accomplished chiefly because the donor's dispositions left the title to and control of such property in the town but, for twenty years after the donor's death, placed control of the expenditure of trust income indispensable to the support and operation of the project in the discretion of trustees whose negotiations with the representatives of the town respecting the project had reached "an impasse" which was not the result of a conflict of personalities or due to any lack of honesty or good faith; and this court therefore approved a scheme altering the mechanism provided by the donor to the extent necessary to save and carry out the dominant purposes of his gifts.
In cy pres proceedings this court approved a scheme overriding the provisions of a testamentary trust placing payments of income for furtherance of a public charity wholly in the discretion of the trustees by directing them to pay to a town a certain sum from income forthwith and thereafter seventy per cent of the net income; by changing somewhat methods of disposing of and acquiring certain personal property; by allowing the town to use income for educational and recreational activities incidental to the project, a power vested by the testator solely in the trustees; and, instead of the trustees forming a corporation to take over the trust property and their activities, as the will provided, by allowing the town to cause the formation of a corporation to act as its agency in operating the project.
In a provision of an instrument creating a charitable trust and authorizing the trustee to pay to a town from income such sums as the trustee might think necessary "to make up any deficiency in the income of" another charitable trust for the town created by the same settlor, the word
"deficiency" did not mean deficit but meant an insufficiency of the income of the other trust to carry out the common objects of the two trusts.
An appropriate court might properly authorize a town to establish a corporation solely to act as the town's agency in managing real and personal property for certain charitable purposes for which the property had been given to the town and to receive income payable to the town from trust funds created by the donor for the support of the project, where the donor, in making his gift of the property to the town and in creating the trusts, had not prescribed any method by which the town must act.
Charitable gifts are made subject to the doctrine of cy pres, and the application of that doctrine in an appropriate case does not violate the constitutional provision forbidding impairment of the obligation of contracts.
Upon approving in general a certain cy pres scheme, this court authorized the trial court, in framing a decree to put the scheme into effect, to supply necessary additional detail, or to make necessary minor modifications, in a way not inconsistent with the main particulars of the scheme, and to provide in the decree that the case be retained for a reasonable time for such alterations in the scheme as experience with it might show to be necessary.
Testamentary trustees paying income to a town, or to a corporation acting as its agency, for charitable purposes under the terms of the will or the terms of a cy pres decree would not be required to see to the proper application of such money unless it were paid in such circumstances as would amount to participation with knowledge in a breach of trust.
A testamentary trustee directed by the will to pay over the income of the trust to a town for certain charitable purposes should pay over the income at reasonable intervals.
In a suit in equity by ten taxpayers of a town, to which a testator in his lifetime had conveyed property in trust for a charitable purpose, and by the town itself, against the attorney general and the trustees of two trusts established by the will of the testator for the support of such project, the trustee of one of such trusts having included a prayer for relief in his answer, the court had jurisdiction under G. L. (Ter. Ed.) c. 214, Section 1, so far as it might not have had it under Section 3
(11), to frame a complete cy pres scheme modifying the testamentary trusts, and to determine various incidental matters.
PETITION IN EQUITY, filed in the Supreme Judicial Court for the county of Suffolk on April 14, 1947, by leave of court.
Following the report of a master, an interlocutory decree denying a motion of the respondents Webber and others, trustees, to recommit to the master and confirming the report was entered by order of Spalding, J., by whom the suit was reserved and reported to the full court.
F. B. Wallis, (L.
Wheeler, Jr., & N. C. Fitts with him,) for the petitioners.
A. C. Webber, for Webber and others, trustees. W. J. Speers, Jr., for The Merchants National Bank of Boston, trustee.
C. A. Barnes, Attorney General, & M.
A. Fredo, Assistant Attorney General, for the Attorney General, submitted a brief.
This suit in equity is brought by ten taxpayers of the town of Lincoln under G. L. (Ter. Ed.) c. 214, Section 3 (11), and by the town itself, against The Merchants National Bank of Boston (hereinafter called the bank) as trustee of a trust (hereinafter called the A trust) created by the will of Julian de Cordova, late of Lincoln, Mr. Webber and four others as trustees under another trust (hereinafter called the B trust) created by the same will, and the Attorney General. The principal purpose of the suit is to secure modification by the court under the doctrine of cy pres of some of the terms of the A and B trusts and of still another trust upon which the town holds certain real estate conveyed to it by de Cordova in his lifetime. All three trusts are related to each other and are parts of one scheme or plan designed by de Cordova for the purpose of setting up in Lincoln a perpetual charity for the maintenance, in memory of himself and his deceased wife, of an art museum and park for the benefit of the inhabitants of the town. Further objects of the suit are to secure certain interpretations of the A and B trusts and directions to the trustees designed to remove doubts and to clarify their duties.
Consideration of a demurrer contained in the answer of the B trustees was reserved until the hearing on the merits. No separate discussion of the demurrer is required, since if the facts established by the master's report make a case for relief, the petition sufficiently states such a case as against any of the grounds set forth in the demurrer.
Julian de Cordova died November 23, 1945, at the age of ninety-five. On November 29, 1930, he had conveyed to the town, and the town had accepted, about twenty-nine acres of land on Sandy Pond. On this land were located his residence, a building known as the art gallery, and some incidental buildings. The conveyance also included the collections of pictures and of other objects of art and interest contained in the buildings. The grantor reserved a life estate to himself and also provided that after his death the town should hold the property in trust to maintain the land as a public park for the benefit of its inhabitants and the residence and art gallery for their benefit as a public museum under the name "The de Cordova and Dana Museum." It was provided that new buildings might be added or substituted, but that any of the objects of art might be disposed of only with the approval of an expert selected by the director or similar officer of the Museum of Fine Arts in Boston. To induce the town to accept this conveyance, de Cordova executed a sealed instrument wherein he covenanted with the town that he had deposited with the bank $250,000 in securities as a guaranty that if the town should accept the conveyance he would provide by will $150,000 for the benefit of the town for the upkeep, maintenance, and improvement of the premises and would make a further substantial provision for the town which, "subject to such reasonable discretions" as he might "interpose," would allow the income to be used in case of need for the upkeep, maintenance, or improvement of the park or museum. He did make these two provisions in his will in the form of the A trust and the B...
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