Deutsche Presbyterische Kirche v. Trustees of Presbytery of Elizabeth

• Decision Date: 22 August 1918
• Docket Number: No. 44/728.,44/728.
• Citation: 104 A. 642
• Parties: DEUTSCHE PRESBYTERISCHE KIRCHE v. TRUSTEES OF PRESBYTERY OF ELIZABETH et al.
• Court: New Jersey Court of Chancery

104 A. 642

DEUTSCHE PRESBYTERISCHE KIRCHE

v. TRUSTEES OF PRESBYTERY OF ELIZABETH et al.

No. 44/728.

Court of Chancery of New Jersey.

Aug. 22, 1918.

Bill by the Deutsche Presbyterische Kirche against the trustees of the Presbytery of Elizabeth and others, to enjoin a sale of church property. Injunction issued.

Charles J. Stamler, of Rahway, for complainant. Conover English, of Newark, for defendants.

Orlando H. Dey, of Rahway, for Greek Church.

STEVENS, V. C. This is a controversy over the equitable ownership of a church property in Rahway. Prior to May 15, 1909, the title was vested in complainant. On that day, by warranty deed, it, by certain of its trustees, conveyed or attempted to convey it to the trustees of the Presbytery of Elizabeth. The church now claims that it still has an equitable interest. The trustees of the Presbytery contend that they are the absolute owners. As such they have agreed to sell to St. John's Greek Catholic Church of Rahway, one of the defendants. The bill is filed, primarily, to enjoin them from so doing.

The church was organized as a Presbyterian congregation on April 10, 1884, under the Religious Corporations Act (3 Comp. St. 1910, p. 4339). A year thereafter it acquired the property in controversy from the Rahway Savings Institution, for the consideration of $2,400. It gave back a mortgage to secure $1,000 of the purchase money. The membership was small from the beginning, and as time went on it diminished. Between 1885 and 1909 it had paid only $200 on its mortgage indebtedness. On January 19, 1909, as appears from the minutes of the Elizabeth Presbytery, the following resolution was passed by that body:

"Resolved that the matter be referred to the Standing Committee of the Board of Church Erection and the Trustees of Presbytery, and to give the Trustees of Presbytery power to negotiate a loan of $800 during the interval of Presbytery, if such a course should be found necessary."

These boards, after consideration, reported to the Presbytery, which thereupon adopted the following resolutions:

"1. That Presbytery hereby approves the action of its committee * * * in proposing to the German Presbyterian Church of Rahway to transfer its property by deed to the Trustee's of Presbytery, in return for the assumption by the Trustees of Presbytery of the mortgage of $800 now lying against the property.

"2. That Presbytery hereby authorizes the Trustees of Presbytery to accept title to the German Presbyterian Church, provided it be offered, upon the terms above named, to enter into such agreement with the said congregation, as will secure the German Presbyterian Church of Rahway the free use of the property as long as it exists in connection with the Presbytery, and to do all that may be necessary to complete the transaction both as respects the transference of the title and the replacing of the mortgage."

By this resolution certain members of the Presbytery (including the Rev. Dr. Kerr) were appointed to represent Presbytery at the congregational meeting of the German Presbyterian Church to be held on the next Monday evening. This meeting took place, and Mr. Helms, one of the members of the congregation, offered the following resolution:

"Whereas, the church is incumbered with a mortgage for $800.00 which has existed for twenty-four years and the congregation seems unable to pay the same, and payment thereof has been demanded:

"And whereas the congregation has with difficulty sustained regular religious services and seems unable to do more under existing conditions ;

"And whereas the Presbytery of Elizabeth, its members and subordinate committees to a large extent provided the funds for the acquisition of the church property, and it is desired that the property continue to be devoted to religious uses under direction of the Presbytery and be not lost by foreclosure or otherwise; and the Trustees of the Presbytery of Elizabeth have offered to assume said mortgage:

"Resolved, that the trustees of this church be directed to convey the church property consisting of a lot 50 feet wide fronting on Irving street, Rahway. and the church edifice thereon to the Trustees of the Presbytery of Elizabeth, their successors and assigns.

"Resolved, further that the Presbytery of Elizabeth be respectfully requested to still allow us to occupy and use the church for religious services so long as we may be able to sustain stated religious worship therein and to keep the property in proper order and repair.

"Resolved, further that the Presbytery of Elizabeth he requested to enter into agreement with the church to return the title to the property whenever the church pays the amount of the mortgage above referred to and that the church has the privilege of paying the amounts in installments of $100 or more."

The minutes show that a vote was taken by ballot. Ten votes were cast—all in favor of the preambles and resolutions—being (so the minutes state) "more than two-thirds of all the votes cast." The minutes do not show whether other members of the congregation were present.

On May 15, 1909, the German Church made a deed to the Trustees of the Presbytery of Elizabeth, in consideration, so the deed states, of "one dollar and other valuable consideration." The deed contains, unreservedly, covenants of seisin, warranty, and against incumbrances. It does not declare that the property is conveyed subject to the mortgage. Although the resolution of Presbytery provided that the Trustees of the Presbytery should assume payment, it, the grantor, by its covenant against incumbrances undertook to do so. The Presbytery furthermore directed its committee to enter into an agreement to secure the free use of the property as long as it (the church) existed in connection with the Presbytery. They made no such agreement, and nothing was done about the resolution of the congregation that provided that the Presbytery should be requested to enter into an agreement to return the title whenever the church paid the mortgage.

On May 27, 1909, the Trustees of the Presbytery paid off the mortgage to the savings institution with the proceeds of a $900 mortgage made by them to the ...