197 N.E. 288 | NY | 1935
In April, 1931, Mary Gertrude Abbey made and delivered to the plaintiff trustee a deed of trust and turned over to it cash and securities having an estimated market value of nearly $1,500,000. The settlor was the widow of Edwin Austin Abbey, an American artist of distinction, particularly in the field of mural painting. The entire income was payable to the settlor during her life, and upon her death by far the larger part of the principal was, in a manner intended to perpetuate the name and fame of her husband, devoted to purposes broadly educational and benevolent. Disregarding certain abortive contingent gifts, the dispositive provisions of the trust deed are by its terms grouped and classified as preferred and unpreferred.
The settlor died a few months after making the deed. At that time it was found that the fund was insufficient *302 to permit any payments on the unpreferred donations, and that the preferred donations would have to abate forty per cent or more from their face amounts. Included in the preferred group was the following:
"e. To pay over out of the principal of said trust fund to the Trustees in New York of the `American Academy in Rome' (of which the Settlor's husband was one of the original incorporators) the sum of One hundred and fifty thousand dollars ($150,000) (thus constituting him a Founder) to be held in Trust however as a memorial to Settlor's husband and the capital shall be kept unimpaired. The capital shall be invested and be kept perpetually invested in such securities as they shall deem proper and from time to time they may vary or transfer any such investments into or for such securities as they may think advisable and the income of said One hundred and fifty thousand dollars shall be used as follows: They, the said Trustees, shall form and incorporate an association entitled `The Incorporated Edwin Austin Abbey Memorial Scholarships for Mural Painting in the United States of America' based on the form of incorporation carried out in London, England, on the 30th day of March, 1926, a copy of which will be provided by my Trustee or Executor, the City Bank Farmers Trust Company, or the incorporation may be carried out in some other way if thought advisable."
Subsequent provisions of the paragraph, too extended for quotation, outline the purposes and scope of the association. In substance, the association, through a council composed of eight members whose qualifications are prescribed, was to establish and thereafter to award certain scholarships, the holders of which were to follow courses of study in mural painting formulated and supervised by the council in accordance with the known ideals of Edwin Austin Abbey for the training of a mural painter. *303
The American Academy in Rome (hereinafter called the Academy) is a corporation created by act of Congress, constituting the persons therein named (among whom is Edwin Austin Abbey), their associates and successors, a body politic in the District of Columbia, "For the purpose of establishing and maintaining an institution to promote the study and practice of the fine arts and to aid and stimulate the education and training of architects, painters, sculptors, and other artists by enabling such citizens of the United States as shall be selected by competition from among those who have passed with honor through leading technical schools or have been equally qualified by private instruction or study to develop their powers and complete their training under the most favorable conditions of direction and surroundings." The act authorizes the corporation to adopt a constitution, by-laws and regulations and to hold real estate in the United States and in Italy for its uses and purposes. The by-laws provide that persons named in the act of incorporation shall be charter members; and that persons donating not less than one hundred thousand dollars shall be founders.
The Academy, for reasons which do not appear, rejected the donation of $150,000. The principal question before us is the disposition to be made thereof. The answer rests largely upon the construction of the provisions of the paragraph quoted above which embody it. The contention of the plaintiff and others is that the donation to the Academy was an outright gift to a charitable corporation for one of its corporate purposes; that where such a gift is rejected, the cy pres doctrine is inapplicable; and, therefore, that the amount of the rejected gift may be distributed proportionately among the other preferred donees, thereby decreasing the percentage of abatement.
The courts below, however, have construed the paragraph as creating a charitable trust and have held that the rejection of the donation does not result in a failure *304 of the gift, but that under the cy pres doctrine new trustees should be appointed to carry out the purpose of the settlor in accordance with the general plan outlined in the deed of trust.
It is, of course, true that the use by the settlor of words of trust is not conclusive as to the character of the donation. (Wetmore v. Parker,
There is no serious contention that the cy pres doctrine is inapplicable, as matter of law, if the gift was by way of trust. The essential and dominant purpose of the settlor can be fulfilled. The plaintiff, however, urges various reasons why the power of the court to deal with the case cy pres may not be appropriately exercised here. The point is probably one with which this court should not deal; it relates to a matter of discretion rather than to one of law.
The other matters raised by the appeals of the defendants-appellants were, we think, rightly disposed of below and require no discussion.
The judgment should be affirmed, with costs to all parties appearing by separate counsel and filing separate briefs payable out of the estate.
CRANE, Ch. J., LEHMAN, O'BRIEN, HUBBS and LOUGHRAN, JJ., concur; FINCH, J., not sitting.
Judgment affirmed, etc. *306