Hames v. City of Polson

Decision Date03 March 1950
Docket NumberNo. 8922,8922
Citation123 Mont. 469,215 P.2d 950
PartiesHAMES v. CITY OF POLSON et al.
CourtMontana Supreme Court

T. H. MacDonald, Kalispell, Lloyd I. Wallace, Polson, Mr. MacDonald and Mr. Wallace argued the case orally, for Appellants.

F. N. Hamman, Polson, Mr. Hamman argued the case orally, for Respondent.

BOTTOMLY, Justice.

This is an appeal from a decree and order granting a permanent injunction, enjoining the operation of bars and slot machines and gambling upon or within the confines of the described municipal public park owned by the city of Polson in Lake county, Montana.

Prior to 1936 the Polson Country Club, then an unincorporated association, owned a tract of land, about one-half mile northeast of the Polson city limits, on which golf was played.

To qualify for federal grants of W.P.A. funds, available to municipal corporations and other public agencies but not obtainable by private persons, the Polson Country Club, on July 7, 1936, conveyed the aforesaid property to the city of Polson for development and use as a municipal park, recreational grounds, and golf course purposes, by deed as follows:

'This indenture, made the 7th day of July, in the year of our Lord, one thousand nine hundred and thirty six, between the Polson Country Club, a corporation, organized and existing under and by virtue of the laws of the State of Montana, with its principal place of business and Post Office address at Polson, Montana, party of the first part, and the City of Polson, in Lake County, a municipal corporation of the State of Montana, party of the second part.

'Witnesseth. That the said party of the first part, for and in consideration of the sum of One and no/100 Dollars ($1.00) and other good and valuable consideration, lawful money of the United States of America to it in hand paid by the said party of the second part, the receipt of which is hereby acknowledged, do remise, release and forever quitclaim unto the said party of the second part, and to its successors and assigns, the following described real estate, situated in the County of Lake, and State of Montana, to-wit:

'Lot Four (4) and the Northwest Quarter of the Southwest Quarter (NW 1/4 SW 1/4) of Section Two (2) in Township Twenty-two (22) North of Range Twenty (20) West, according to the United States government survey thereof, save and excepting from, however, all easements for rights of way heretofore granted to the Northern Pacific Railway Company for railroad purposes, and likewise all easements for rights of way heretofore granted for and on behalf of the public highway purposes and any right of way heretofore granted or now existing for pole lines or ditches and likewise this conveyance shall be subject to flowage rights now or hereafter constructed, excepting therefrom, that portion of said tract of land which lies South of the U. S. Highway No. 93, containing approximately four (4) acres, more or less.

'Together with all the tenements, hereditaments and appurtenances thereunto belonging, and the reversion and reversions, remainder and remainders, rents, issues and profits thereof; and also all the estate, right, title, interest, property, possession, claim and demand whatsoever, as well in law as in equity for the said party of the first part, of, in or to the said premises, and every part and parcel thereof.

'To have and to hold, all and singular, the said premises, with the appurtenances unto the said party of the second part, its successors and assigns forever, for municipal park, recreational grounds and golf course purposes.

'This grant is made and accepted upon condition that said tract of land shall be used for park, recreational grounds and golf course purposes, and upon condition that, in the event the same ceases to be used, maintained and kept up for such purposes, then the title to said land and premises together with the appurtenances and improvements thereon, shall revert to the grantor herein named and that the grantee will reconvey such title to said grantor, and upon further condition that the grantee herein will by ordinance or resolution create and provide a park Board or Commission, consisting of three members to be appointed by the Mayor of the City of Polson, one of whom shall be a member of the City Council of the City of Polson, and the other two shall be members in good standing of the Polson Country Club, and that said park Board or Commission shall be vested with power and authority to govern and manage said park, recreational grounds and golf course and to make reasonable rules and regulations for the use thereof by the public.'

The city accepted the deed and by ordinance assumed to create a city park board and to prescribe its duties.

Through grants of public funds obtained by the city through the federal W.P.A., augmented by contributions received from the people of the city of Polson and different interested groups and organizations, a large building was erected on the tract.

Assuming to act under the authority of section 72 of a city ordinance, Article XIV, on March 10, 1948, such park board so created by said ordinance, entered into a lease agreement with the Polson Country Club then and now a private corporation, whereby the said park board leased to the Polson Country Club the lower portion of the large building and the playing area of the golf course, all located on the property described in the above deed, for a term of five years from April 20, 1948. As rent the club is to pay to the city of Polson all green fees and membership fees collected by the club. The park board on behalf of the city of Polson agreed to keep up and maintain the leased property and pay for all water, lights and heat and it was agreed the Polson Country Club could not sublease the property or any part thereof without consent of the park board.

Similar arrangements without any lease have been in operation between the city of Polson and the Polson Country Club since the completion of the building in 1937 or 1938 prior to the said lease and apparently no objections were encounted until about two years ago when the Polson Country Club, after the execution of the lease, installed a bar and began selling beer and liquor and operating slot machines in what is called the bar or club room on the leased lower floor of the large building, from which portion of the building and premises the general public was and is excluded. The kitchen and rooms occupied as living quarters by the manager and his family are also located on this first floor. The manager also serves the members of the Polson Country Club with beer or liquors as required.

The plaintiff in his complaint alleges that at all times material to this action he is and has been a taxpayer in the city of Polson, Montana, and as such brings this action on his own behalf and on behalf of other taxpayers similarly situated; that the property is held in trust by the city of Polson for a specific purpose, under the terms and conditions imposed in the deed to the city, being for municipal park, recreational, and golf course purposes, and to the use and benefit of the general public for those purposes only; that a bar and slot machines operated at, in and upon these premises interferes with the general public's use of the property and that the action of the defendants has been in total disregard of their duties and obligations to and toward the citizens of Polson and this plaintiff.

This taxpayer's action is brought to protect the interests and rights of the inhabitants of Polson in and to the property deeded to the city of Polson and the complaint on its face clearly states a cause of action, showing plaintiff to be entitled prima facie to an injunction. See McClintock v. City of Great Falls, 53 Mont. 221, 163 P. 99; Lloyd v. City of Great Falls, 107 Mont. 442, 86 P.2d 395; Colwell v. City of Great Falls, 117 Mont. 126, 138, 157 P.2d 1013; Milligan v. City of Miles City, 51 Mont. 374, 382, 153 P. 276, L.R.A.1916C, 395 and cases therein cited.

The deed is absolute in its terms and conveyed the fee simple title to the property therein described to the city where it has since remained.

A city or town is but an assemblage of inhabitants living in the vicinity of each other and not separated by any other intervening division of the state and having a designated number of inhabitants, and when organized as a municipal corporation such step is taken for the purpose, mainly, that the people within its territorial limits may thereby be enabled, for their own interest and advantage, to administer their local and internal concerns. The property covered by the above described deed, while running to the city, is in fact a trust, the city council being the trustees holding the legal title, and the equitable title being in the cestui que trust, being the inhabitants, the public, of the city of Polson.

'A fundamental essential to the existence of any trust is the separation of the legal estate from the beneficial enjoyment * * *' 26 R.C.L., 'Trusts,' sec. 22, p. 1186; Doan v. Vestry of Parish of Ascension, 103 Md. 662, 64 A. 314 and note 7 L.R.A., N.S., 1119, 115 Am.St.Rep. 379; Hospes v. Northwestern Mfg. & Car Co., 48 Minn. 174, 50 N.W. 1117, 15 L.R.A. 470, 31 Am.St.Rep. 637.

This beneficial enjoyment, or, in other words, the equitable title to the subject matter of the trust, is vested in the person or persons for whose benefit the trust is created, known as the cestui que trust. See Dillenbeck v. Pinnell, 121 Iowa 201, 96 N.W. 860.

For whose benefit was this trust now under consideration created? Surely not for the Country Club. The property is but the subject matter of the trust, legal title to which is vested in the trustees, in this case the city council, for the use and benefit of all the inhabitants of the city of Polson generally, they being the ones entitled to the beneficial enjoyment of the...

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