323 Mass. 583 | Mass. | 1949
This is a petition in equity under G. L. (Ter. Ed.) c. 231 A, inserted by St. 1945, c. 582, § 1, brought in the Probate Court for the county of Berkshire by two trustees and holders of certificates of shares of the Thursday Morning Club Trust of Great Barrington, Massachusetts, a voluntary trust created by a declaration of trust dated March 17, 1915, and recorded in the registry of deeds, seeking a declaratory decree concerning the administration of this trust, created by a written instrument and so within the jurisdiction of the Probate Court by virtue of G. L. (Ter. Ed.) c. 215, § 6, as amended by St. 1939, c. 194, § 2, as to whether the shares of the trust held in accordance with the records of the trust in the name of the Thursday Morning Club of Great Barrington, an unincorporated voluntary association, were properly voted in the election
In the absence of any report of the evidence or findings by the judge, the only question presented is whether the decree could properly have been entered on the pleadings. Hale v. Blanchard, 242 Mass. 262, 264. Gorey v. Guarente, 303 Mass. 569, 570. The entry of the decree imports a finding of all facts in support of the decree which are permissible under the pleadings. Brogna v. Commissioner of Banks, 248 Mass. 241. Novick v. Novick, 299 Mass. 15. We cannot accept as evidence anything contained in the stipulations of counsel not approved by the judge or statements of counsel contained in their briefs pertaining to evidence not appearing in the record. Lucier v. Williams, ante, 458.
The petition alleges that the trust instrument, which is made a part of the petition, provides that the shares of the trust may be voted by proxy; that a majority of votes shall determine any question; that the club is the beneficiary of the trust and owns shares which stand on the books of the trust in the name of the club and have always been voted at the annual meetings by representatives of the club appointed by the directors of the club; that at the 1946 annual meeting of the shareholders, a controversy arose as to the right of the club to vote these shares for the election of trustees; that these shares were voted for the election of certain respondents (the Brothers group) through its duly authorized representatives; and that these votes together
Before considering these technical objections, it is well to consider the express purpose and the actual administration of the trust, its relation to the club, the custom and usage of the membership of the club with reference to participating in the affairs of the trust, and the recognition by the trust of the manner in which the club managed the shares issued to it. An inspection of the trust instrument discloses that the immediate and primary purpose for the creation of the trust was to acquire certain real estate for the use and benefit of the club and that, upon the termination of the trust, the proceeds from the sale of its property, after paying the shareholders, should be held or disposed of for the benefit of the club if then in existence. In new subscriptions for shares subsequent to the original subscription, preference was to be given to existing shareholders and members of the club. It is alleged in the petition, and so far as appears could have been found by the judge, that the club is the principal if not the sole beneficiary of the trust; and that shares in the trust stand on the books of the trust in the name of the club and have always been voted at the annual meeting of the .shareholders by persons appointed by the directors of the club. It could be found that the intent of the parties to the trust instrument in the creation and administration of the trust was to provide and maintain a parcel of real estate for the use and occupancy of the club; that shares should be purchased by members of the club;
Custom and usage of the club for thirty years in voting the shares and the acquiescence of the trust in recognizing the vote of the shares by the proxy of the club are not to be disregarded in determining the intent of the parties, especially where the shareholders were not strangers to the members of the club and where there was a close affiliation between the trust and the club. See State v. Hicks, 154 N. C. 265, 268.
The club was not a legal entity and could not hold title to these trust shares; the ownership thereof vested in the members of the club who owned them jointly for the purpose for which the club was organized and maintained, Torrey v. Baker, 1 Allen, 120, Byam v. Bickford, 140 Mass. 31, Hanley v. American Railway Express Co. 244 Mass. 248; but the members could collectively transfer the management and control of the shares to the directors of the club and confer upon them the power to appoint a proxy to vote the shares at the annual meetings of the shareholders of the trust. So far as the record goes, these shares may have been purchased with the funds of the club and taken in its name as a matter of convenience and the management of the shares entrusted to the board of directors by virtue of some rule or by-law of the club. One becoming a member of the club assumed an obligation in the nature of a contract to become bound by such a rule or by-law in so far as it
The voting of the shares by. a representative of the club was a practical and efficient method of giving the club a voice in the administration of the trust. We do not know the number of shares held in the name of the club nor the number of outstanding shares of the trust. It might be that no quorum could be had at the annual meetings of the shareholders if the shares issued in the name of the club were not represented. If a proxy were selected by the individual members of the club, a check up of the membership would have to be made just before the meeting to make certain no changes in the membership had occurred since the proxy was given. It may have been for the purpose of avoiding such a difficulty that the shares were issued in the name of the club and a provision inserted in the trust instrument to the effect that “The name in which the certificate stands upon the books of the trustees shall be considered by them conclusive evidence of ownership of the shares . . ..”
The trust instrument provides that no individual shall hold more than fifty shares. As already pointed out, we do not know the number of shares which were issued in the name of the club and, even if the shares exceeded fifty, they were held not by an individual but by a group of individuals who comprised the club.
Decree affirmed.