Woman's Christian National Library Association v. Fordyce

• Decision Date: 10 December 1905
• Citation: 86 S.W. 417,79 Ark. 532
• Parties: WOMAN'S CHRISTIAN NATIONAL LIBRARY ASSOCIATION v. FORDYCE
• Court: Arkansas Supreme Court

86 S.W. 417

79 Ark. 532

WOMAN'S CHRISTIAN NATIONAL LIBRARY ASSOCIATION v. FORDYCE

Supreme Court of Arkansas

December 10, 1905

Appeal from Garland Circuit Court; Alexander M. Duffie, Judge reversed.

The plaintiff, the Woman's Christian National Library Association, a corporation, brought this action against S.W Fordyce and Charles H. McKee.

The complaint charges in effect that Mrs. E. B. Hotchkiss and a number of other ladies, being desirous of founding a free public library in the city of Hot Springs, and of making donations of funds as a matter of purely public charity, for the purpose of securing, providing and obtaining a suitable and attractive building, where the literature and books of such a library might be permanently lodged, donated the sum of $ 100 to be used for the purpose of paying for certain lots in Hot Springs to be used for such purpose only. In order to secure the right to enter the property, which then belonged to the United States Government, they petitioned Congress to permit a corporation which they had organized as charitable trustee to receive title to said property, to enter same for a free public library; setting forth in their petition that they had organized a corporation having for its object the establishment of a free public library and reading room; that its objects were purely public and charitable, and contemplated, for the free use of the thousands of sick who are constantly in attendance at the Springs, commodious rooms, a large library and newspapers, etc. Their petition concluded by asking that an act be passed granting to said association this property "to be held by them while it shall be so used." That Congress, upon receiving their petition, appointed a committee and adopted their report which is entitled "Lot at Hot Springs, Ark., for use of Woman's Library Association." That the report shows that Congress understood the object was "to erect a building thereon for so laudable a purpose as that of furnishing a free library and reading room to the thousands of sick, rich and poor, constantly in attendance at the Springs from every quarter of the country." The Congressional committee in its report also seemed to understand that these ladies expected to donate these lots as it says: "Your committee, believing said association to be sincere in its work of charity, has concluded that the Government in its generosity ought to aid it to the extent of donating the grounds for its building." That the act of Congress authorized the Association to enter "for the uses and purposes of such Association." The complaint then alleges that thereupon the said corporation used the money donated for said charitable purpose expressly to make entry of said land, and received a patent which alludes to said act. The complaint sets forth the articles of incorporation of the Association, which include the petition to the circuit court alleging that the object of the Association was "for the purpose of establishing, providing and keeping, in the City of Hot Springs, Garland County, Ark., a library for the free use of the public generally, and soliciting and receiving donations and aid for said purposes." The articles of the Association provide: "They (the officers) shall not make any contract or bill with any one that shall operate as a lien or mortgage on the building or library of the Association."

Articles ten and eleven of the Association provide as follows:

"10. The object of this association shall be to provide books, newspapers and magazines of such character as will afford instruction and diversion, but such books and papers as are demoralizing in their tendency or subversive of religion shall not be admitted.

"11. The object of this association is to provide a suitable and attractive building where the literature of the association may be permanently lodged, and where suitable lecture rooms on such subjects as are not in field of political or theological controversy, and other entertainments not in conflict with the objects of the Association may be given."

That the corporation is and was a mere trustee of the naked legal title to said property for a public charitable use, and has never had any beneficial interest in the same, or any interest which could be taken, sold or appropriated to satisfy any judgment obtained against said corporation for the torts of its agents. That the defendants have possession of said property without right, claiming to own the same by virtue of a sale under execution for the enforcement of a judgment for damages rendered for an alleged tortious act of said corporation on account of injuries inflicted by one Murray, who was excavating said property under contract, and by means of a blast which injured defendant's grantor, who was plaintiff in said suit and purchaser at said execution sale. That the funds donated to purchase the lots are about to be diverted. That the plaintiffs are willing to carry out the charitable object.

The complaint concludes with prayer for recovery of possession and all further and general relief.

A demurrer to the complaint was sustained. Plaintiff has appealed.

Judgment reversed and remanded.

R. G. Davies, for appellant.

The court erred in sustaining the demurrer to the complaint. Even if appellant had not itself been a charitable corporation, but a mere naked trustee, the trust funds could not be held liable for the torts of the corporation's agents. 1 L. R. A. 417. It was not, however, necessary that there be any trustee at all. 95 U.S. 303. The evidence discloses the trust, and that is sufficient. 113 Pa.St. 269. Further, that the trust fund was not subject to the claim of appellees, see Elliott, Priv. Corp., § 19; Fr. Void Jud. Sales, § 35; 27 Am. & Eng. Enc. Law, 50, 51. The trustee had no power to sell where it would prejudice the object of the charity. 17 Ark. 488. A deed was unnecessary where the property was dedicated to public use. 9 Am. & Eng. Enc. Law, 38. The articles of association plainly show that the corporation was a trustee. Cf. Sand. & H. Dig., §§ 1392, 1426. The fact that dues were collected does not alter this. 86 Pa.App. 306. Further, upon the proposition that the corporation was really a trustee, see 19 Ala. 814; 35 Pa. 316; 4 Ga. 404; 7 Vt. 243; 3 Lead. Cas. R. Prop. 374; 10 Allen, 169; 34 N.J.Eq. 321; 86 Pa.St. 306 S.C. 5 W. N. C. 196; S.C. 3 Lead. Cas. Real Prop. 339, 340, 341; 14 Allen, 539; S.C. 2 Am. & Eng. Lead. Cas. Eq. 18, 24, 25. Further, on the proposition that the corporation was a mere trustee, and that the trust funds are not liable, see: 31 L. R. A., 227; 60 F. 365; 41 Ark. 271; 1 Wh. & Tud. Lead. Cas. Eq. 802; Freeman, Ex., § 109; Freeman, Judg., § 356; 93 Am. Dec. 346; 27 Am. & Eng. Enc. Law, 107; 11 Vt. 283; 120 Mass. 432; 60 F. 365; 15 N.Y. 620; S.C. 13 N.E. 781; 18 F. 221; 32 P. 1012; Ell. Priv. Corp., § 19; 4 Wheat. 518; 22 Am. Dec. 236; 31 L. R. A. 227; 26 Am. Dec. 446; 38 Am. Rep. 298. Cases in 86 Ga. 486 and 12 S.C. 882 are not applicable.

Wood & Henderson, for appellees.

The appellant was not a public or charitable corporation. 14 Allen, 556; 3 Pom. Eq. Jur., § 1020, et seq.; Perry, Tr., §§ 697, 710; 44 Conn. 60, S.C. 26 Am. Rep. 424; 132 Mass. 211, S.C. 39 Am. Rep. 445; 29 N.J.Eq. 36; 1 McG. & C. 286; L. R. 9 Ir. 246; 2 Oh. 649; 19 L. R. A. 413; 29 N.J.Eq. 32; 35 A. 1064; 42 N.E. 1130; 15 N.E. 505; 107 U.S. 174; 111 Mass. 267; Thomps. Corp., §§ 8143, et sep.; 4 Wheat. 516; 12 Ark. 353; Sand. & H. Dig., § 1419; Thomps. Corp., § 6466. The property was not excepted by the statutes (Sand. & H. Dig., §§ 3049, 3053, 3054) from execution, and must therefore be subject to same. Thomps. Corp., § 7847; 75 Am. Dec. 518; 26 Am. Dec. 561; Fr. Ex., § 348; 57 Ga. 340; 346; 5 Ired. L. 297; 12 L. R. A. 852; 13 L. R. A. 668; 69 Ark. 68; 57 Ark. 445; 62 Ark. 481. A trust cannot be engrafted by parol upon the property, as against creditors of the legal owners. Sand. & H. Dig., § 3480; 57 Ark. 637; 67 Ark. 530; 59 Ark. 71. Appellant was liable for the negligence which is the foundation of appellees' claim. Sand. & H. Dig., §§ 1419, 1393, 1397; 12 R. I. 411, S.C. 34 Am. Rep. 675; 12 S.E. 882; 31 L. R. A. 227; 60 F. 365; 29 Am. Rep. 17; 36 Am. Rep. 17; 32 Am. Rep. 408; 37 Am. St. Rep. 24; 10 N.Y.S. 115; 28 A. 32; 4 Oh. 399; 36 Am. Rep. 508; 51 Am. Dec. 284; 18 Am. St. Rep. 284; 53 Ind. 337; 3 Md. 431.

Wood & Henderson, Ratcliffe & Fletcher, for appellee, on motion to reconsider.

The court erred in holding that appellant holds only a naked legal title to the property. 1 Beach, Trusts, § 554; Tied. Real Prop., § 515; 4 Wheat. 636; Mech. Ag., § 733; 86 Ga. 486; 2 Beach, Trusts, §§ 402, 407; 1 Lewin, Trusts, 221; 83 N.C. 65; 17 Ark. 483; 86 Pa.St. 306; 57 Ark. 445; 145 Ill. 628; 151 Mass. 365; 69 Ark. 68; 56 Ark. 354; 50 Ark. 141.

R. G. Davies, for appellant.

Trust funds are not liable for the trustee's tort. 86 Ga. 486; 60 Pa.St. 30; 3 W. & S. 27; 2 Grant, 75; 183 Mass. 126; 68 Ohio St. 236; 7 Ohio St. 114.

HILL, C. J. WOOD, J., disqualified. MCCULLOCH, J., not participating.

OPINION

HILL, C. J.

The Reporter will state the facts showing the object and purposes of the corporation, its organization and plan, and the history of the acquisition of the property in question.

The court holds on the facts presented that the property in controversy was acquired by the appellant corporation for the purpose of establishing and maintaining thereupon a reading room and library for the benefit of the members of the corporation and "of the multitude of people who visit" the city of Hot Springs "in search of health and pleasure." Under these facts, is such property subject to sale under execution on a judgment rendered against the corporation for a tort? The judgment was recovered for an injury received by...