Butterworth v. Keeler

• Decision Date: 28 December 1916
• Citation: 114 N.E. 803,219 N.Y. 446
• Parties: BUTTERWORTH et al. v. KEELER et al.
• Court: New York Court of Appeals Court of Appeals

219 N.Y. 446

114 N.E. 803

BUTTERWORTH et al.

v.KEELER et al.

Court of Appeals of New York.

Dec. 28, 1916.

Appeal from Supreme Court, Appellate Division, First Department.

Action by George F. Butterworth and another, as executors, etc., of Cornelia Storrs, deceased, against Charles E. Keeler and others. From a judgment of the Appellate Division for the First Department, affirming judgment for plaintiffs on report of referee (169 App. Div. 136,154 N. Y. Supp. 744), defendants appeal. Affirmed.

Frederick N. Van Zandt, of New York City, for appellants.

Henry W. Taft, of New York City, for plaintiff respondents.

Robert P. Beyer, of New York City, for respondent Attorney General.

CARDOZO, J.

This action is brought to construe the will of Cornelia Storrs, who died in April, 1912. She directed that her residuary estate be divided into two parts. One of these parts she gave to the New York Skin and Cancer Hospital. The other she gave to her executors ‘George F. Butterworth and Henry J. Storrs, in trust, nevertheless, to be used and devoted by them to the establishment of a school for girls in the town of North Salem, Westchester county, New York.’ The question is whether this latter gift is a valid charitable trust.

That it is valid if it is charitable, is not disputed. Matter of MacDowell, 217 N. Y. 454, 112 N. E. 177, L. R. A. 1916E, 1246. The claim is made, however, by some of the next of kin that in truth it is not charitable. We think the claim is without merit. It is established law in this state that a gift for the promotion of education or learning is a gift for charitable uses. Matter of Robinson, 203 N. Y. 380, 96 N. E. 925,37 L. R. A. (N. S.) 1023;Starr v. Selleck, 145 App. Div. 869,130 N. Y. Supp. 693,205 N. Y. 545,98 N. E. 1116;Matter of Cunningham, 206 N. Y. 601, 100 N. E. 437;Rothschild v.Schiff, 188 N. Y. 327, 80 N. E. 1030;People ex rel. N. Y. Inst. for the Blind v. Fitch, 154 N. Y. 14, 31,47 N. E. 983,38 L. R. A. 591. The rule is the same in England (St. 43 Eliz. c. 4; Wicker v. Hume, 7 H. L. Cas. 124; Smith v. Kerr, [1902] 1 Ch. 774; Matter of Hawkins, [1906] 22 T. L. R. 521); in the Supreme Court of the United States (Russell v. Allen, 107 U. S. 163, 167, 172, 2 Sup. Ct. 327, 27 L. Ed. 397;Perin v. Carey, 24 How. 465,17 L. Ed. 701), and in the highest courts of sister states (Sears v. Chapman, 158 Mass. 400, 33 N. E. 604,35 Am. St. Rep. 502;Dexter v. Harvard College, 176 Mass. 192, 57 N. E. 371;Parks v. Northwestern University, 218 Ill. 381, 75 N. E. 991,2 L. R. A. [N. S.] 556,4 Ann. Cas. 103). Many other cases to the same effect might be cited. There is no conflict of opinion anywhere. The rule, of course, is different where the school or other institution is maintained for the profit of its owners. The purpose must be the promotion, not of private profit, but of public learning. Matter of MacDowell, supra. It is not charity to aid a business enterprise. But the fact that fees are charged is not controlling. Parks v. Northwestern University, supra; Matter of MacDowell, supra, 217 N. Y. at page 464, 112 N. E. 177, L. R. A. 1916E, 1246. Most of our universities and hospitals would be excluded by such a test, yet universities and hospitals are unquestionably public charities. Parks v. Northwestern University, supra; Schloendorff v. Society of N. Y. Hospital, 211 N. Y. 125, 127,105 N. E. 92,52 L. R. A. (N. S.) 505, Ann. Cas. 1915C, 581. What controls is not the receipt of income, but its purpose. Income added to the endowment helps to make it possible for the work to go on. It is only when income may be applied to the profit of the founders that business has a beginning and charity an end. The line of division is the same whether the gift is devoted to education or to the relief of the poor, the halt, and the blind. Charity ministers to the mind as well as to the body.

Our decision in Matter of Shattuck, 193 N. Y. 446, 86 N. E. 455, is said by the appellants to have revolutionized these ancient principles; but it did nothing of the kind. The trust in that case was not to found a new institution of learning. It was to pay the income to existing institutions, either religious or educational or eleemosynary. This left the trustees free to select any educational institution, whether eleemosynary or not. They were therefore free to select institutions organized for private profit. The decisive consideration was the contrast which the court discerned in the mind of the testatrix between purposes that were educational and purposes that were eleemosynary. If the trust had been for the advancement of education, and nothing more, a different conclusion might have followed. The Shattuck Case lays down no principle of large and general application. It defines the meaning of a particular will, and later cases have held that it must be limited to its special facts. Matter of Robinson, Matter of Cunningham, supra.

[3] Different altogether is the will before us. No such latitude of choice is given to these trustees. They are not to distribute a fund among existing institutions, whether eleemosynary or not....