Wright v. Mcgee

• Decision Date: 28 February 1934
• Docket Number: No. 376.,376.
• Citation: 206 N.C. 52,173 S.E. 31
• Parties: WRIGHT et al. v. McGEE.
• Court: North Carolina Supreme Court

173 S.E. 31

206 N.C. 52

WRIGHT et al.

v.McGEE.

No. 376.

Supreme Court of North Carolina.

Feb. 28, 1934.

Appeal from Superior Court, Wake County; Harris, Judge.

Action by W. B. Wright and others, constituting the majority of the trustees of Rex Hospital, against J. W. McGee, one of the trustees of Rex Hospital. From a judgment, defendant appeals.

Action dismissed.

This action was begun in the superior court of Wake county under the authority, and pursuant to the provisions, of chapter 102, Public Laws of North Carolina, 1931, which is entitled, "An Act to Authorize Declaratory Judgments."

The plaintiffs and the defendant constitute the trustees of Rex Hospital, a corporation created by the General Assembly of North Carolina. Chapter 0, Private Laws of North Carolina, 1840-41. The said corporation is now the owner of certain property, real and personal, situate in the city of Raleigh, and known as Rex Hospital. The said hospital is operated primarily as a public charity, and is maintained and supported by said corporation with funds derived from certain endowments and donations which have been made to it to enable the said corporation to provide hospital facilities for poor and afflicted persons who reside in the city of Raleigh. These funds are insufficient in amount for the adequate support and maintenance of said hospital, and for this reason are supplemented by funds derived from patrons of said hospital, who are able to pay and who do pay for the services rendered to them by said corporation.

The buildings and equipment of Rex Hospital are now inadequate for the purposes of a modern hospital, and certain repairs and improvements are necessary in order that the corporation may continue to receive patronage which will enable it to provide hospital facilities for poor and afflicted persons residing in the city of Raleigh. The' corporation is without funds to pay for such repairs and improvements, and for that reason has applied to the Public Works Administration, an agency of the government of the United States, for a loan of $250,000 to be expended by the said corporation in making said repairs and improvements, and in enlarging the facilities of Rex Hospital. If the application is approved, and if the loan is made, the corporation will be required by said Public Works Administration to secure the same by a mortgage or deed of trust on all its property, both real and personal, situate in the city of Raleigh, and known as Rex Hospital.

The plaintiffs, who constitute a majority of the trustees of Rex Hospital, contend that the corporation has the power to borrow money for the purpose of repairing and improving its property, and of enlarging the facilities of Rex Hospital, and to secure the payment of money loaned for such purposes by a mortgage or deed of trust on its property. The defendant, who is one of the trustees of Rex Hospital, contends to the contrary. The sole question presented for determination is whether the trustees of Rex Hospital, as a corporate body, have the power to borrow money for the purpose of repairing and improving said hospital, and of enlarging its facilities, and to secure the payment of the same by a mortgage or deed of trust on said hospital.

On the facts alleged in the complaint and admitted in the answer, the court concluded:

"1. That all persons interested in this Controversy have been duly served with summons and are now before the Court. That the defendant J. W. McGee has duly filed an answer by his counsel admitting the facts as alleged in the petition, but seriously controverting the right of The Trustees of Rex Hospital to borrow money under said state of facts, and as a matter of law.

"2. That the Court has jurisdiction of this action and of all parties concerned, by reason of the power conferred upon it by chapter 102, Public Laws of North Carolina 1931, known as 'The Uniform Declaratory Judgment Act.'

"3. That the Court is of the opinion and so holds upon the foregoing findings of fact that the Trustees of Rex Hospital have full power to accept the loan offered by the Public Works Administration, to borrow money and to pledge therefor the physical property now in the hands of said Trustees known as Rex Hospital, as security therefor, by way ofmortgage, deed of trust, or other legal instrument, and to do any and all things necessary and proper to the completion of said loan, the proceeds of which shall be used for the purpose of either improving the present hospital building or building a new hospital and providing equipment for the same."

It was thereupon ordered, considered, adjudged, and decreed by the court:

"1. That The Trustees of Rex Hospital and their successors have and are hereby fully clothed with the power to borrow money for the purpose of improving the present hospital and its equipment and/or of erecting a new hospital and providing such equipment; to pledge the physical property of the institution known as Rex Hospital as security for said loan and to execute a mortgage, a deed of trust, or any other legal instrument pledging said property; to execute notes or bonds representing the indebtedness involved and to do any and all things necessary to a proper and legal conclusion of said loan; and said Trustees of Rex Hospital or their successors are hereby adjudged to have full power to accept the loan from the Public Works Administration, or any other corporation making a loan to said Trustees for the purposes above expressed; and to do any and all things necessary for the acceptance and conclusion of the same, including the power to alienate as above provided.

"2. It is further ordered that the costs of this action be taxed against the...