Opinion
13180.
MAY 23, 1940.
Construction of will; intervention. Before Judge Humphries. October 16, 1939.
Royall, Gosney Smith and James A. Branch, for plaintiff.
Spalding, Sibley, Troutman Brock, for defendant.
1. In the circumstances stated in division 1 of the opinion, legal title to the residuary estate vested in the trustees at the death of the testatrix, with right of possession postponed until acceptance of the charter and organization of the corporation, with equitable title to the property in the beneficiaries of the trust, that might extend to an unlimited number of lives now in being and yet to come. Such disposition of the property would create a perpetuity within the meaning of the Code, § 85-707. However, the law inhibiting perpetuities does not apply to charities.
2. A hospital is not per se a subject of charity as defined in the Code, § 108-203. Whether a hospital is such subject of charity depends on requirement of hospital service rendered for relief of human suffering as related to the poor, and to be free of charge where there is inability to pay. Where such is the purpose and the hospital operates in pursuance of that purpose, it is a subject of charity within the meaning of the statute. The principle was stated and applied in Trust Company of Georgia v. Williams, 184 Ga. 706 ( 192 S.E. 913), in which there was a different result due to the difference in the devise. There was no requirement there, as in the instant case, that the hospital services be extended to the poor free of charge in cases of inability to pay. The decision in that case was rendered by four Justices (two of the Justices not presiding), and is not binding as a precedent, but is now approved by the entire bench of six Justices.
3. The residuary bequest in the instant case, construed in connection with all the items of the will and the Code, §§ 108-202, 108-204, as set forth in division 3 of the opinion, shows the intent of the testatrix to require hospital service free of charge to poor people who are unable to pay. Such being the intent, the proposed hospital is a proper subject of charity within the meaning of the statute. This is not altered because of the further intent to charge persons able to pay, where the receipts from that service are to be devoted to maintenance or improvement of the hospital, with no element of private gain.
4. The residuary bequest in question was sufficiently definite and specific in objects, as required by the Code, § 108-201, and was not void as opposed to that law.
5. None of the grounds of attack on validity of the residuary bequest are tenable.
No. 13180. MAY 23, 1940.
Mrs. Cora B. Williams died in March, 1924, survived by her two sisters Edith Congdon Taylor and Mary Harriet Taylor, who were her next of kin and only heirs at law. By her will Mrs. Williams provided for establishment of an institution to be incorporated and known as "The Jesse Parker Williams Hospital," and after giving direction as to payment of debts, funeral expenses, erection of certain monuments, and for certain specific legacies and devises, devised and bequeathed by the tenth and subsequent items of the will, the residue of her estate for the establishment and maintenance of the said institution. In 1929 certain trustees duly appointed by the executor, in pursuance of powers expressed in the will, applied for and procured in the superior court a charter incorporating the institution under the above name as a charitable "(non-profit, no capital stock)" corporation. The executor paid over the said residue, amounting to about $1,900.000, to the corporation, which assumed to act and carry out the provisions of the will relating to establishment and maintenance of the hospital. Mary Harriet Taylor died on April 14, 1934, leaving a will in virtue of which Edith Congdon Taylor succeeded to all right that said Mary as heir at law of Mrs. Williams would have taken to the residue, if there was an intestacy as to such residue. In August, 1939, Edith Congdon Taylor instituted an action against the Jesse Parker Williams Hospital, seeking to declare void the bequest of said residue, for accounting and recovery with respect to the properties received from the executor, for injunction to prevent construction and maintenance of the hospital, and for general relief. The petition showed all that is stated above, set forth a copy of the will, and alleged specifically various grounds of attack upon those parts of the will relating to disposition of the residue. These grounds are dealt with in the opinion. The pertinent portions of the will follow:
"Item X. . . My executor is directed to conserve the estate and to sell and dispose of the same to the best advantage; and when he has fully administered the same and is ready to be discharged, then he shall appoint five (5) citizens of the State of Georgia, in his judgment fit and proper persons, as Trustees of the `Jesse Parker Williams Hospital,' to act as trustees for the corporate body for the creation of which provision is hereinafter made.
"Item XI. My executor is directed upon the incorporation and organization, as hereinafter provided, of the Trustees of the `Jesse Parker Williams Hospital,' to pay over, assign, transfer, and convey the rest and residue of my estate to said incorporated and organized Trustees of the `Jesse Parker Williams Hospital' who are to hold and use the same in trust for the benefit of the hospital hereinafter provided for.
"It is my wish and I direct, as far as may be lawful and within the terms of this my will, that my executor shall prescribe the terms and conditions of the incorporation and organization of the Trustees of the `Jesse Parker Williams Hospital,' for the creation of which body provision is hereinafter made.
"Item XII. I desire and direct that the location of the hospital hereinafter provided for in this my will shall be within the State of Georgia; the selection of the county in said State for the location of the same to be made by and to rest with the five Trustees of the `Jesse Parker Williams Hospital,' who are to be appointed, as hereinabove provided for, by my executor; the selection of said county to be decided by the majority vote of said trustees, as hereinafter provided for.
"Item XIII. As I desire not only to relieve human suffering and distress, but also to pay a tribute of love and respect to my late husband, I wish and direct that the hospital for which provision is hereinafter made be forever known as the `Jesse Parker Williams Hospital.' It is my wish, and I direct, that only women, female children, and males under twelve years of age be admitted to the `Jesse Parker Williams Hospital,' for which provision is hereinafter made; except in cases of grave emergency, the necessity of which emergency always to rest with the decision of the Trustees of the `Jesse Parker Williams Hospital.'
"Item XIV. I wish and direct that the terms of office of the five trustees of the `Jesse Parker Williams Hospital' first appointed, appointed by my executor hereinabove named, shall be one (1), two (2), three (3), four (4), and five (5) years respective, my executor designating, in making the appointments, the respective terms of the several appointees. I further desire and direct that the five Trustees of the `Jesse Parker Williams Hospital' first appointed by my executor named hereinabove, shall, as soon after their appointment and acceptance as may be practicable, select, by a majority vote, the county in the State of Georgia in which the hospital hereinafter provided for is to be located, and, this having been done, that they shall file their petition to become a body corporate under the laws of the State of Georgia, with the corporate name, Trustees of the `Jesse Parker Williams Hospital;' said corporate body to be managed and directed by a board of trustees, five in number, the first five of such managing and directing trustees being the five Trustees of the `Jesse Parker Williams Hospital' appointed by my executor, as hereinabove provided for, they each to serve for the time and term in accord with their appointment by my executor, as hereinabove provided. The purpose of said corporate body shall be to select and secure an option or options, of not less than six months duration and term, on an appropriate site or sites in the county already selected for the hospital hereinafter provided for; to receive from my executor all the rest and residue of my estate on his hands, not especially bequeathed and . . devised, and to apply the same to the purchase of one or more of the sites so selected and held by option, and to the erection thereon, the equipment, furnishing, and maintenance of a suitable building, or suitable buildings, for the hospital hereinafter provided for, together with all necessary and appropriate grounds, fixtures, appliances, furniture, machinery, and appurtenances, and to the employment of necessary, proper, and suitable servants, employees and attendants, as required and necessary in the conduct and management of the hospital hereinafter provided for; and for the purpose of conducting any and all other business as may be necessary, fit, and proper in the management, operation, conduct, development, and extension of the hospital, provision for which is hereinafter made. All expense of such incorporation and organization, and any expense incident to securing the option or options on the site or sites selected for the location of the hospital hereinafter provided for, as hereinbefore set forth, shall be paid out of my estate, by my executor.
"Item XV. It is my desire and I direct that: the members of the incorporated board of trustees, hereinabove provided for, shall have power and authority to fill any vacancy that may occur in their number, the appointee to be a citizen of the State of Georgia, a fit and proper person in their judgment, and to serve for the unexpired term of the member in whose place the appointment is made; on the expiration of the term of office of any number of the incorporated board of trustees as hereinabove provided for, the remaining members shall select a citizen of the State of Georgia, a fit and proper person in their judgment, as trustee to fill such vacancy, and the newly elected trustee shall serve for four (4) years; at the expiration of the term of office of the first appointed trustees, appointed by my executor as hereinabove provided for, the regular term of each trustee shall be four (4) years from election and qualification; a member shall be eligible to succeed himself. In the event of a tie vote in the election of a member, and the board shall not make a choice in ten days from the date of the first tie vote, the board shall certify that fact to the judge of the superior court of the county where the hospital is located, who shall make his appointment, and his decision making the appointment shall be final.
"Item XVI. The trustees of the `Jesse Parker Williams Hospital' first appointed, appointed by my executor hereinabove provided for, having been incorporated, the charter accepted by them, the incorporated board of trustees regularly organized, an option or options having been secured by them on an appropriate site or sites for the location of the hospital hereinafter provided for, then the said trustees are directed and ordered to receive from my executor all the rest and residue of my estate in his hands, not specially bequeathed or devised, and to apply the same to the purchase of the site or sites for the location of the hospital hereinafter provided for, and in their, judgment, but not later than ten (10) years after their acceptance of the charter hereinabove provided for, to apply the remainder of the moneys and . . property received by them from my executor, and the proceeds therefrom in the foundation, establishment, building, and maintenance of a hospital to be located on the site or sites purchased by them for said hospital, to be forever known as the `Jesse Parker Williams Hospital,' and to further apply said moneys, property, and the proceeds therefrom to the erection, equipment, finishing, furnishing, and maintenance of a suitable building or buildings, with all necessary and appropriate grounds, fixtures, appliances, machinery, and appurtenances; and to the employment of necessary, proper, and suitable servants, employees, and attendants, all as may be required and are necessary in the establishment, building, equipment, management, direction, operation, conduct, development, and extension of the said `Jesse Parker Williams Hospital;' but I wish and direct that only women, female children, and males under twelve years of age be admitted to said hospital, except in cases of grave emergency, the necessity of said emergency always to rest on the decision of the said trustees. The said trustees shall have the authority and the power to employ and discharge all surgeons, physicians, nurses, servants, and agents, as they may deem proper; they shall have the right to make such rules and regulations and by-laws for the government of that body and the management of the hospital as they may deem needful; they shall have all the rights, powers, authority, and privileges of trustees of charitable institutions under the laws of the State of Georgia.
"If, at the time when my executor turns over to the trustees of the hospital hereinabove provided for the rest and residue of my estate, both of my sisters are in life, then the said trustees are directed to pay annually, severally and not jointly, to each of my sisters, seventy-five hundred ($7500.00) dollars, for and during their respective lives. On the death of either of my sisters, the said trustees shall pay annually to the survivor of them, for and during her natural lifetime, the sum of seventy-five hundred ($7500.00) dollars. On the death of both of my sisters all payment shall cease. But until the death of both of them, the sum to be paid to them, or to the survivor of them, shall be a charge upon the property held by the said trustees.
"Item XVII. . . It is my desire that my executor shall manage and control my property and . . estate in such manner as he may deem best, and he is given (10) ten years in which to close up the estate. If, at the expiration of ten years from the date of his qualification, there shall be any property of the estate still in his hand unadministered, it is my will that he sell it to the best advantage and pay the proceeds over to the Trustees of the `Jesse Parker Williams Hospital.'"
The action was dismissed on general demurrer, and the plaintiff excepted.
1. "An absolute or fee-simple estate is one in which the owner is entitled to the entire property, with unconditional power of disposition during his life, and which descends to his heirs and legal representatives upon his death intestate." Code, § 85-501. "An absolute estate may be created to commence in future, and the fee may be in abeyance without detriment to the rights of subsequent remainders. A fee may be limited upon a fee, either by deed or will, where the plain intention of the grantor or testator requires it, and no other rule of law is violated thereby." § 85-502. "An estate for life may be either for the life of the tenant or for the life of some other person or persons." § 85-601. "An estate in remainder is one limited to be enjoyed after another estate is determined, or at a time specified in the future." § 85-701. "Limitations of estates may extend through any number of lives in being at the time when the limitations commence, and 21 years, and the usual period of gestation added thereafter. A limitation beyond that period the law terms a perpetuity, and forbids its creation. When an attempt is made to create a perpetuity, the law gives effect to the limitations not too remote, declaring the others void, and thereby vests the fee in the last taker under legal limitations." § 85-707. In the instant case the will allows the executor ten years in which to administer the estate. When he is ready to be discharged, the duty is imposed upon him, initiatory to establishment of a hospital, to appoint trustees, who shall select a site, procure options for location of the hospital, and apply for a charter incorporating the institution, all at the expense of the estate, to be paid by the executor. The trustees so appointed by the executor should be trustees of the corporation in charge of its affairs. The offices of the trustees should be filled for special terms, with provision for continual succession and filling of vacancies by vote of the trustees. When the charter is accepted and the corporation organized, it is the duty of the trustees to receive from the executor, and his duty to pay to them, the described residue of the estate, to be applied by the trustees within ten years to the building, equipping, maintaining, and operating of the proposed hospital at which "only women, female children, and males under twelve years of age be admitted; . . except in cases of grave emergency, the necessity of which emergency always to rest with the decision of the trustees," to be "forever known" as the "Jesse Parker Williams Hospital." The legal title vested in the trustees at the death of testatrix, with right of possession of the property postponed until acceptance and organization of the corporation, with equitable title to the property in the beneficiaries of the trust that might extend to an unlimited number of lives now in being and yet to come into existence. Such disposition of the property would create a perpetuity within the meaning of the Code, § 85-707. But the law against perpetuities has long been held not to apply to charities. Jones v. Habersham, 107 U.S. 174 (9) ( 2 Sup. Ct. 336, 27 L. ed. 401); Perkins v. Citizens Southern National Bank, 190 Ga. 29 ( 8 S.E.2d 28); Murphy v. Johnston, 190 Ga. 23 (7) ( 8 S.E.2d 23).
2. "The following subjects are proper matters of charity for the jurisdiction of equity: 1. Relief of aged, impotent, diseased, or poor people. 2. Every educational purpose. 3. Religious instruction or worship. 4. Construction or repair of public works, or highways, or other public conveniences. 5. Promotion of any craft or persons engaging therein. 6. Redemption or relief of prisoners or captives. 7. Improvement or repair of cemeteries or tombstones. 8. Other similar subjects, having for their object the relief of human suffering or the promotion of human civilization." Code, § 108-203. The statute does not define or expressly mention hospitals, but in subsection 8 it includes other similar subjects having for their object the relief of human suffering. One of the "similar" subjects is relief of "poor people." It therefore includes relief of human suffering as relates to the poor. Relief of human suffering in a general sense may be accomplished through instrumentality of a hospital, but hospital benefits are not necessarily available to the poor. They may be denied to that large class of humanity for the sole reason of inability to pay. Unless the benefits extend to the poor, a hospital is not a subject of charity within the meaning of the statute. The word "similar" and the words "poor people" characterize the subject of charity as contemplated by the statute. They are in the statute and must be given effect. They can not by construction be written out of the statute as it relates to relief of human suffering through instrumentality of such an institution as a hospital, no mention of which is made in the statute. This does not mean that others than the poor or those able to pay may not be charged for benefits afforded by the hospital where the receipts are to be applied to maintenance or operation or even enlargement or improvement of the institution. Neither does it mean that poor persons may not, for the purposes indicated, be reasonably charged according to their ability or inability to pay. In all such circumstances the fruit of the charges will be deemed contributions to relief of human suffering as it relates to the poor. According to this statute a hospital is not per se a subject of charity. Whether one at all depends on requirement of hospital services rendered for relief of human suffering as it relates to the poor, and free of charge where there is inability to pay. Where such is its purpose and the hospital operates in pursuance of that purpose, it is within the meaning of the statute a subject of charity. Code, § 108-203.
The foregoing is substantially a statement, in different language, of a principle ruled in Trust Company of Georgia v. Williams, 184 Ga. 706 (supra), founded on and interpreting the same statute. The devise there under consideration differed from that now involved, and was held not to be a charity and to be void as violative of the law inhibiting perpetuities. That statute is the law of this State, and is controlling on the question of what will constitute a charity within the meaning of the laws of this State. The decision, having been rendered by less than the entire bench of six Justices (two of the Justices being absent), is not a binding precedent, but on mature consideration by all the Justices it is approved. The ruling conforms to much that is said in Richardson v. Executive Committee of the Baptist Convention, 176 Ga. 705 ( 169 S.E. 18), and similar cases. In that case, however, the question was as to exemption from taxation, under the constitution and law (Code, §§ 2-5002, 92-201), of property of all institutions of "purely public charity," provided the property is not "used for purposes of private or corporate profit or income." It was not there decided that the institution was one of purely public charity, and consequently that decision is not binding as a precedent on the question of whether it is a charity within the meaning of the statute. The foregoing conclusion is not altered by the special bequests for life to or for the benefit of the testatrix's sisters, since these bequests would merely reduce the amount to be devoted as the residuum to charitable purposes.
3. "A charity once inaugurated is always subject to the supervision and direction of a court of equity, to render effectual its purpose and object." Code, § 108-204. "When a valid charitable bequest is incapable for some reason of execution in the exact manner provided by the testator, donor, or founder, a court of equity will carry it into effect in such a way as will as nearly as possible effectuate his intention." Code, § 108-202. In the instant case, referring to the proposed hospital, the testatrix in item XIII of the will expressed a desire "to relieve human suffering and distress," and directed "that only women, female children, and males under twelve years of age be admitted, . . except in cases of grave emergency, the necessity of which emergency always to rest with the decision of the trustees." The same desire was repeated in item XVI, in which among other things it was stated that the trustees "shall have all the rights, powers, authority, and privileges of trustees of charitable institutions under the laws of the State of Georgia." These provisions, considered as they must be in connection with all other provisions of the will, show intent of the testatrix to include the poor who are unable to pay, as being entitled to admission and to receive the benefits afforded by the hospital. It would be beyond the power of the trustees to deny poor people only because of inability to pay for the benefits intended to be bestowed for relief provided for by the will. It is further to be deduced from the provisions of the will that the testatrix intended not to exclude charges for hospital admission and service as relates to those able to pay, where the receipts derived from such charges would be applied to the operation, maintenance, and enlargement of the hospital as a charitable institution, and without any element of private gain. The testatrix is presumed to have known of the provisions of the statutes hereinabove set forth, and to have made her will with reference thereto, and with the understanding that if the trustees should fail or refuse to administer the trust for the relief of human suffering as relates to poor people, the courts of equity would cause the institution to be administered in accordance with the testamentary design. The testamentary intent manifested as it must be by all the terms of the will is controlling, and demands the conclusion that the proposed hospital in question is a proper subject of charity within the meaning of the statute. Code, § 108-203.
4. Equity has jurisdiction to carry into effect the charitable bequests of a testator, or founder, or donor, where the same are definite and specific in their objects, and capable of being executed. Code, § 108-201. Under this law, although a bequest be intended as charity, in order that equity may be invoked to carry it into effect the bequests must be "definite and specific in their objects, and capable of being executed." As already indicated, the hospital is to be located in the State of Georgia, and administered by the trustees according to general directions and according to the laws of Georgia regulating charitable institutions. The benefits are confined to "women, female children, and males under twelve years of age; . . except in cases of grave emergency, the necessity of which emergency always to rest with the decision of the trustees." The express purpose of the testatrix was for "relief of human suffering." Such being the purpose and character of the bequest, it was sufficiently definite for administration by the trustees, subject to regulation by the court of equity. Consequently it was not void, as contended, on the ground of indefiniteness. The bequest is quite similar, though not in all respects, to a bequest "for the aid and assistance of aged females in Bibb County, Georgia, and of underprivileged children in said county," which was recently held by this court to be sufficiently definite, in Perkins v. Citizens Southern National Bank, supra. But it is substantially different from a bequest "to the Trustees of the Dosia Head Brooks Home for Gentlewomen," which was held to be void for indefiniteness, in Bramblett v. Trust Company of Georgia, 182 Ga. 87 ( 185 S.E. 72). See Egleston v. Trust Co. of Ga., 147 Ga. 154, 313 ( 93 S.E. 84, 878, 3 A.L.R. 295).
5. It is not deemed necessary to deal with the grounds of attack upon the residuary bequest and devise and the trust to be created thereby, further than as indicated above, except to add that not any of the grounds of attack are tenable. In the brief of the attorneys for the plaintiff the grounds of attack are thus stated: "(1) The property devised and bequeathed was not sufficient to carry out the purposes set forth in the will. (2) The provisions of the residuary devise were so vague, uncertain, and indefinite as to be void. (3) The powers given the executor and trustees as to the residuary property were so broad and unrestricted as to authorize the executor and trustees to make a will for the testator. (4) The trustees, a self-perpetuating body, have full authority under the will to create a bounty for themselves. (5) The property devised and bequeathed was not required to be used for charitable purposes; and the devise and bequest violated the rule against perpetuities, and was therefore void."
6. Under the rulings stated above, the petition of the heir at law, seeking for a decree establishing an intestacy as to the residuary estate and directing its administration according to laws of descent and distribution, and for an accounting and injunctive relief, was subject to general demurrer as failing to state a cause of action. The court did not err in sustaining the demurrer to the petition as amended, and in dismissing the action.
Judgment affirmed. All the Justices concur.