The Theological Seminary of Auburn vs. Childs & Stebbins, 4 Paige Ch. 419

The Chancellor. By the decision of the court for the correction of errors in M’Cartee v. The Orphan Asylum Society, (9 Cawen's Rep. 437,) it is settled that the statute of wills of March, 1813, (1 R. L. 364,) did not authorize a devise of real estate directly to a corporation. And in the recent revision of the laws, it is declared that no devise to a corporation shall fee .valid unless such corporation be expressly authorized by its charter, or by statute, to take .by devise. (2 R. S. 57, § 3.) It is insisted, however, on the part of the complainants, that by their act of incorporation they are authorized to take lands by devise directly to themselves. By the first

section of that act, (Laws of 1820, p. 197,) the corporation is declared to be capable in law of taking, purchasing, holding and conveying any real or personal estate. And it is supposed by the complainants’ counsel that the word taking, in this act, distinguishes it materially from the act incorporating The. Orphan Asylum Society, in which that word is not found.

Were there no other way in which a corporation could take property, according to the usual acceptation of that term, except by a devise thereof, this charter might, perhaps, by necessary implication, give to a testator the right to transfer his title to real estate to the corporation by will. A corporation, however, may acquire property by a gift, or voluntary donation, as well as by a purchase thereof, in the ordinary sense in which the word purchase is used.

There is nothing, therefore, in the use of the word taking, in the complainants’ act of incorporation, from which we are authorized to infer that the legislature intended to give to them the right to take, either real or personal estate, in any other manner than that in which the owner thereof was authorized to convey it to any other corporation. He had the power to do this by bargain and sale, or by a gift or voluntary grant thereof to the corporation. But he was not authorized, either by statute or by the common law, to transfer the legal title in his real estate, to a corporation, by a direct devise.

To make a valid transfer of property, it is not only necessary that the individual, or corporate body, to whom it is to be transferred, should have the legal capacity to take, but the person who is to make the transfer must also have the right or power to transfer the property, in the manner in which he attempts to transfer the same. In this case, therefore, I am satisfied the complainants could not have acquired title to real estate by a direct devise from the testator.

It will be necessary then to inquire whether the decedent could give to the complainants a part of the proceeds of his real property, as a testamentary bequest, by means of a devise of a power to his executors to sell the estate for that purpose.

A devise to a corporation being now prohibited by statute, and the legislature having abolished mere nominal trusts, and indeed all trusts as to real estate except in a few specified cases, it seems to follow that no devise to, or in trust for a corporation is valid, either at law or in equity, unless such corporation is expressly authorized by its charter, or by some other statutory provision, to take by devise. (2 R. S. 57, § 3. 1 Id. 728, § 49. Id. 729, § 58. Id. 737, § 129.) In this case the testator died before the passing of the revised statutes.

Yet it is insisted on the part of the defendants that the exception of corporations, in the statute of wills which was then in force, must receive the same construction as the prohibitory clause in the present law ; and that the testator could not give to a corporation, indirectly, an interest in, or a valid lien upon his real estate, when he had not the legal power to make a direct devise of the estate itself to. such corporation, l am not prepared to say that the devise of a-power in trust to executors to sell lands for the payment of a legacy charged thereon, in favor of a corporation, would be invalid, even under the revised statutes.

On that subject, however, I do not wish to be understood as expressing any definitive opinion. But I am satisfied that at the time this will was made, and at the death of the testator, in 1826, he had the legal right to devise his real estate to a trustee in trust for a corporation ; and that the devise of such estate to his executors, to sell the same, for the payment of. this and other legacies charged thereon, was valid.

The feudal policy having changed the ancient common law of England, and deprived the owners of lands of the power of devising the same at their deaths, the statute of wills was an enabling statute, and the exception as to corporations was strictly only an exception, and not a prohibition. The decision of this court in The Orphan Asylum Society v. M'Cartee, is conclusive on this question. Although the decree of Chancellor Jones in that case was reversed, it was solely upon the ground that the devise to the corporation was direct, and not to the executors in trust. Indeed, Mr.

Justice Woodworth, who delivered the opinion of the majority of the court for the correction of errors in that case, admits that if the legal estate had remained in the executors, in trust for the corporation, and they had refused to pay over its portion of the proceeds of the property on a sale thereof, the complainants would have been entitled to relief. (9 Cowen’s Rep. 506.) The cases referred to by the defendants’ counsel are founded upon the prohibitions of the statute, 9 Geo. 2, ch. 36 ; (1 Evan’s Stat. 324,) under which statute, although it contains no express,Words prohibiting a bequest of money to be produced by the sale of lands, for charitable purposes, it has been settled by construction that such a bequest is void, as being within the spirit and meaning of the act. (See 14 Vesey's Rep. 541.) There must, therefore, in pursuance of the stipulation in the case, be a decree against the defendants for the payment of the legacy, to the complainants, out of the proceeds of the lands devised to the executors to be sold, for that and other purposes.