Young Women's Christian Ass'n of Ashville, N. C., Inc. v. Morgan

• Decision Date: 16 June 1972
• Docket Number: No. 125,125
• Court: North Carolina Supreme Court
• Parties: YOUNG WOMEN'S CHRISTIAN ASSOCIATION OF ASHEVILLE, NORTH CAROLINA, INC. v. Robert MORGAN, Attorney General, State of North Carolina.

Page 169

189 S.E.2d 169

281 N.C. 485

YOUNG WOMEN'S CHRISTIAN ASSOCIATION OF ASHEVILLE, NORTH CAROLINA, INC. v. Robert MORGAN, Attorney General, State of North Carolina.

No. 125.

Supreme Court of North Carolina.

June 16, 1972.

Riddle & Shackelford by John E. Shackelford, Asheville, for plaintiff.

Atty. Gen. Robert Morgan, and Asst. Atty. Gen. Christine Y. Denson, for defendant.

BRANCH, Justice.

Defendant, Attorney General, contends that the trial judge erred in holding that the assets received from the estate of Anna Johnson Moorhead are held by plaintiff in fee simple, discharged of any trust. He argues that the assets are held in trust and that any relief granted should be by application of the Cy pres doctrine.

This Court has consistently rejected application of the Cy pres doctrine, as such. However, it has long recognized that the courts may exercise their equitable power, in proper cases, to modify a charitable trust so as to prevent its failure and so as to effectuate the primary purpose of the trustor. Wachovia Bank & Trust Co. v. John Thomasson Construction Co., 275 N.C. 399, 168 S.E.2d 358; Brooks v. Duckworth, 234 N.C. 549, 67 S.E.2d 752; Woodcock v. Wachovia Bank & Trust Co., 214 N.C. 224, 199 S.E. 20.

The Cy pres doctrine derives its meaning from the Anglo-French phrase Cy pres comme possible, meaning 'near as possible.' Thus, when a particular purpose set forth in a charitable trust becomes impossible, illegal or impracticable, the courts exercise their equitable powers to select a purpose as near as possible to that originally selected by the testator or trustor. Bogert, Law of Trusts and Trustees (2d ed. 1965) § 431; IV Scott, Law of Trusts (3d ed. 1967) § 399.

The 1967 General Assembly enacted the Charitable Trust Administration Act, which expressly gave the courts the power to apply the Cy pres doctrine to charitable trusts. When there is a charitable trust, bequest, or devise evidencing a general charitable intent by the grantor, and the specific, express purpose cannot be fulfilled because of illegality, impossibility or impracticability, this act specifically empowers the court, in the absence of alternate disposition, to modify the trust so as to apply the fund to a purpose as nearly as possible like the originally expressed purpose. G.S. § 36--23.2. Note: 'Trusts--Cy Pres Enacted in North Carolina,' 46 NCLR 1020. The doctrine of Cy pres applies only to charitable trusts. Bogert, Law of Trusts and Trustees (2d ed. 1965) § 431.

Generally, when a trust is created for any lawful purpose which promotes the well-being of mankind and does not contravene public policy, it is charitable in its purpose. Woodcock v. Wachovia Bank & Trust Co., supra. A charitable trust has also been defined as '. . . a fiduciary relationship with respect to property, arising as a result of a manifestation of an intent to create it, and subjecting the person by whom the property is held to equitable duties to deal with the property for a charitable purpose.' Restatement (Second) of Trusts, § 348.

The parties stipulated that plaintiff was a charitable corporation at the time it received the fund, and that one of its corporate purposes was to establish and maintain a boarding house for young women. This corporate purpose was manifestly charitable. Thus, we need to decide only whether the will of Anna Johnson Moorhead created a trust.

A trust is based upon a direct declaration or expression of intent (Bowen v. Darden, 241 N.C. 11, 84 S.E.2d 289), yet no particular words are necessary to create a trust if the purpose to create is evident. Morris v. Morris, 246 N.C. 314, 98 S.E.2d 298; Stephens v. Clark, 211 N.C. 84, 189 S.E. 191. Therefore, we must ascertain the intent of the testatrix, for her intent must be given effect unless contrary to public policy or some rule of law. The intent of the testatrix is in reality her will. Such intent is to be determined by examining the provisions of the will in light of all surrounding facts and circumstances known to the testatrix. Citizens National Bank v. Grandfather Home for Children, 280 N.C. 354, 185 S.E.2d 836; Campbell v. Jordan, 274 N.C. 233, 162 S.E.2d 545; McCain v. Womble, 265 N.C. 640, 144 S.E.2d 857; In re Will of Wilson, 260 N.C. 482, 133 S.E.2d 189.

If the whole instrument discloses an intent by the testatrix to convey the legal title to the property or fund to plaintiff, Young Women's Christian Association of Asheville, North Carolina, to hold the property and deal with it for the benefit of another, the property will be affixed with a charitable trust, and, correspondingly, equitable duties will be placed on plaintiff as holder of the legal title. King v. Richardson, 46 F.Supp. 510 (M.D.N.C.); Thomas v. Clay, 187 N.C. 778, 122 S.E. 852; Laws v. Christmas, 178 N.C. 359, 100 S.E. 587. If such intent be not disclosed, plaintiff will be declared absolute owner of the fund, free of any trust.

G.S. § 31--38 provides:

'Sec. 31--38, Devise presumed to be in fee.--When real estate shall be devised to any person, the same shall be held and construed to be a devise in fee simple, unless such devise shall, in plain and express words, show, or it shall be plainly intended by the will, or some part thereof, that the testator intended to convey an estate of less dignity.'

The provisions of this statute have been held to apply to the disposition by will of both real and personal property. Worsley v. Worsley, 260 N.C. 259, 132 S.E.2d 579; Heefner v. Thornton, 216 N.C. 702, 6 S.E.2d 506; Barco v. Owens, 212 N.C. 30, 192 S.E. 862.

In Brinn v. Brinn, 213 N.C. 282, 195 S.E. 793, this Court, speaking through Barnhill, J. (later C.J.) stated:

'A consideration of the decisions in this jurisdiction discloses that it is now a well-established rule in this state that, where an estate is given to a person generally or indefinitely it is construed to be a devise in fee simple, unless such devise shall, in plain and express words, show, or it shall be plainly indicated by the will, or some part thereof, that the testator intended to convey an estate of less dignity. It is so provided by our statute.--C.S., 4162 (now G.S. 31--38). Springs v. Springs, 182 N.C. 484, 109 S.E. 839; Hayes v. Franklin, 141 N.C. 599, 54 S.E. 432; Carter v. Strickland, 165 N.C. 69, 80 S.E. 961, Ann.Cas.1915D, 416; Hardy v. Hardy, supra (174 N.C. 505, 93 S.E. 976); Barco v. Owens, 212 N.C. 30, 192 S.E. 862; Peyton v. Smith, ante, 213 N.C. 155, 195 S.E. 379. Carter v. Strickland, supra, is reported and annotated in Ann.Cas.1915D, at page 416.'

It is seldom that we find aid in prior decisions when we seek to determine the intent of a testator. Although the North Carolina authority on the question here presented deals with real property, these cases offer guidance in reaching our decision as to the intent of the testatrix in bequeathing her personal property.

This Court considered a conveyance of real estate by deed to a religious corporation in St. James v. Bagley, 138 N.C. 384, 50 S.E. 841. There Dr. A. J. De Rosset and wife executed a deed to the Vestry and Wardens of St. James Church, which deed contained the following recital:

'. . . that the said parties of the first part, for the purpose of aiding in the establishment of a Home for Indigent Widows or Orphans, or in the promotion of any other charitable or religious objects to which the property hereinafter conveyed may be appropriated by the said parties of the second part and in further consideration of One Dollar to whom in hand paid by the parties of the second part, the receipt whereof is hereby acknowledged, have granted, bargained and sold, and do by these presents grant, bargain and sell to the said parties of the second part, . . ..'

The Court, in holding that no trust was created, stated:

'. . . 'The effect of a deed must depend upon the effect of the language used. A grantor can impose conditions and can make the title conveyed dependent upon their performance. But if he does not make any condition, but simply expresses the motive which induces him to execute the deed, the legal effect of the granting words cannot be controlled by the language indicating the grantor's motive.' . . ..'

'. . . By all of the canons of construction and the rules laid down by the courts for ascertaining the intention of the donor, we are brought to the conclusion that no trust is created by the language in this deed. In saying that no trust is created, we, of course, mean no other trust than is imposed upon all property held by the trustees or official body representing a religious society, pursuant to the provisions of section $3665 of the Code. (now G.S. § 61--3) The plaintiff held the property for the use of the congregation consisting of the members of the church organized as St. James Parish, with the right and power to appropriate it to such uses and purposes as the said congregation, acting through its organized agencies, may direct . . .. While the language used by the donor is not, strictly speaking, precatory, but rather expressive of motive, the same interpretation should be given it. . . . (Emphasis ours)

'. . . We simply decide that there is no declaration of trust in the deed made by Dr. De Rosset to the plaintiff; that the language sought to be construed into a trust is expressive only of his motive and purpose in conveying the property to the plaintiff, and, in our opinion, expressly excludes the idea of attaching a trust thereto.'

A will was construed in order to determine title to real estate in the case of Williams v. Thompson, 216 N.C. 292, 4 S.E.2d 609. The pertinent clause of the will provided:

'Item I: I leave to my niece Clarentine F. Clift lot No. 108, in the Town of Plymouth during her natural life, and after her death, I give and bequeath the said lot with all improvements and hereditaments to the Methodist Episcopal Church in this place, To be used by the stewards or legal representatives of the said Church in the Town...