American Asylum at Hartford v. President of the Phoenix Bank

| Conn. | Jun 15, 1822

Hosmer, Ch. J.

In May, 1816, the General Assembly of this state incorporated John Caldwell and others, by the name of The Connecticut Asylum for the education of deaf and dumb persons, with the right of purchasing, receiving and holding estate, real and personal, the annual income of which should not exceed 5000 dollars. The funds of this incorporated company were created, by donations, from individuals, from religious societies, from the state of Connecticut, and from the United States. It is averred, in the plaintiffs’ bill, and the fact is admitted, that the Asylum, the name of which has been changed, by legislative act, to The American Asylum, is an institution, having for its sole object the education and instruction of the unfortunate who are deaf and dumb; and that the only means of doing this are derived from the charity of individuals and of the public. From the pupils instructed at the Asylum, who were of ability to make payment for their education, money has been received; and those who were not able, have been supported and educated gratuitously. The disbursements on account of pupils, have considerably exceeded the sums received of them, and the funds of the Asylum have exclusively been applied to the general object of its institution. The act incorporating the Phoenix bank provides, that the said bank shall, at all times, be open for subscriptions, at the rate of 100 dollars for each share, from any school or corporation for charitable purposes within this state; and under a claim of right, the plaintiffs have deposited with the President, Directors and Company of the said bank 20,000 dollars, for the purpose of procuring 200 shares of stock; but their subscription for stock has been refused. The bill of the plaintiffs prays, that the bank be compelled to receive their subscription, and pay the dividends to which they would have had title, had they been permitted to subscribe.

The defendants have presented two objections to the plaintiffs’ bill: first, it is said, they are not a school or corporation for charitable purposes; and secondly, that there is adequate remedy at law.

The interesting and luminous decision of the supreme court of the United States, in the case of the trustees of Dartmouth College v. Woodward, 4 Wheaton 518. with which I entirely accord, and to which I shall have a silent reference in my opinion, only renders it necessary to state the grounds of it, very briefly. Eleemosynary corporations, or those created for charitable purposes, are such as are constituted for the perpetual distribution of the free alms of the founders of them, to such purposes as they have directed. Of this description are hospitals for the maintenance of the poor, sick, or impotent, and colleges or schools for the promotion of piety and learning. The establishment of an institution for the dissemination of learning, has always been considered a charity. The true test of an institution is its origin and objects. If it is founded on donations, and has for its purpose the accomplishment of a charity, by the distribution of alms, it most unquestionably is eleemosynary.

The American Asylum may, with the strictest propriety, be defined, an incorporated school for charitable purposes. It is a school, which is a generic term, denoting an institution for instruction or education; and from the nature of its object, is a private incorporation. Its objects and operations are all of a private character; and the donations of states to aid in effectuating them, do not, in the minutest degree, change its nature. The institution is exclusively "for charitable purposes;" its sole object being to pour instruction into the minds of the deaf and dumb; to elevate them from the lowest degradation of intellect to the dignity of intelligent, and fit them to become moral and religious, beings; to open their blind eyes, and unstop their deaf ears; and to accomplish this, through the means of funds, derived from the gratuities of the benevolent. A purpose so honourable and noble, and free from the dross of self interest, brings the American Asylum peculiarly within the spirit, as it is obviously within the letter, of the law, which authorises a compulsory subscription of the stock of the Phoenix bank. The Asylum, in no sense of the expression, is a money-making institution. All its funds are necessarily applicable to the charitable object of educating the deaf and dumb; and this is done gratuitously, except so far as the power of doing good is enlarged, by the sums paid for instruction, by the rich and able. By this operation, the funds of the institution are not absorbed, but augmented; the charitable object of the Asylum is not diminished, but promoted; and the nature of it is not changed, but pursued. The funds of the institution are not applicable to any but eleemosynary purposes, nor have they been otherwise applied. If they had, it would have constituted a breach of trust, for which there is a most obvious remedy. And as the trustees are alone authorized to act for the promotion of the benevolent object of the institution; so the donors are, in no event, entitled to any profit, which might arise, from the enlargement of its funds. Be they greater or less, they are consecrated to charity; and this decisively marks the eleemosynary character of the institution.

It has been contended, by the defendants, that the plaintiffs have adequate remedy at law, by writ of mandamus.

I think it very doubtful, to say no more, whether the supposed remedy has any existence. The writ of mandamus lies to enforce the execution of an act, when otherwise justice would be obstructed; and, regularly, issues only in cases, relating to the public and the goverment; hence it is called a prerogative writ. Knipe v. Edwin, 4 Mod. Rep. 281. March 101. It never lies to restore to a private office, or to execute a private right; and that the claim of the plaintiffs is founded on this ground only, there can be no question. The King v. The Churchwardens of Croyden, 5 Term Rep. 713, 4. 4 Bac. Abr. 497. 504, 5. Gwil. ed. The refusal of the defendants to permit the plaintiffs to subscribe, is the infraction of the private right of individuals, acting through the medium of an incorporation. A mandamus is never granted, when a person has another specific remedy; or may bring an action on the case, which affords satisfaction equivalent to specific relief; and that case may be sustained against the defendants, for the privation of the legal rights of the plaintiffs, is beyond dispute. In The King v. The Bank of England, Douglass 500. it was decided, that the court would not grant a mandamus to the bank for the transfer of stock, because there is a remedy by action on the case, if they refuse; and the analogy between that case and the one under discussion, is very striking. And lastly, the remedy by mandamus, is discretionary. 4 Bac. Abr. 515. Gwil. ed.

But if the above-mentioned remedy might be had, it is not adequate, because it would not be complete. It would be merely prospective, and not reach the exigencies of the case. The relief on bill in chancery, at one stroke, compels the defendants to permit the plaintiffs to subscribe, and to pay the dividends, as if they had suffered the subscriptions to have been made, at the time the plaintiffs requested it.

In this opinion Chapman, Brainard and Bristol, Js. concurred. Peters, J. being a stockholder in the Phoenix bank, gave no opinion.

Decree for the plaintiffs.