Hallinan v. Hearst

HENSHAW, J. On June 6, 1897, three members of the fire department of the city and county of San Francisco were killed in the discharge of their duties. The defendant Hearst, proprietor of the San Francisco Examiner, contributed money to relieve the necessities and to support the dependent families and relatives of the dead firemen, and made appeal, through the columns of his paper, to the public of San Francisco for like contributions. The result of his efforts was the collection, upon September 10,1897, of the sum of $5,940.25. He thereupon referred the question of the apportionment and disposition of this money to the mayor of the city, the chief of police, and the chief of the fire department. This committee divided the money into thirds, and apportioned one third to this minor plaintiff, — the only son of one of the deceased firemen,—and recommended that the amount awarded to him should be deposited, “ in trust, with one of the trust companies *647 organized under the laws of the state of California, and located in this city, to be paid to him on his coming to legal age, and in case of his death before his majority, the amount so awarded to be paid to the San Francisco Fire Department Charitable Fund Association, whose object is to defray the expenses of the burials of deceased members, and pay any weekly benefits to persons when sick, disabled, or unable to follow their usual vocation, which society is composed of the members and ex-members of the regular San Francisco fire department.” The plaintiff in this action, by his general guardian, seeks a recovery of the sum so allotted and apportioned to him. For answer to the complaint the defendant set up fully the facts and circumstances attending the collection of the money, and the disposition and award made of it by the officers of the city, to whom the matter had been referred. The court found that the money had been subscribed and collected by the defendant for the purpose of properly caring for and supporting the families of the deceased firemen, and that after the collection the defendant had fixed the proportions and terms upon which the money should be distributed, and had appointed James D. Phelan, mayor of San Francisco, Dennis T. Sullivan, chief of the fire department, and Patrick Crowley, formerly chief of police, trustees of said fund, to divide it amongst the persons for whose benefit it had been collected, and that ever since the collection, and down to and at the time of the commencement of this action, the three trustees last named had held said funds, in trust, for the uses and purposes stated. The court also found that the trustees had deposited the amount awarded to this plaintiff in a reliable and secure trust company of the city and county of San Francisco, upon the trust and with directions to pay the amount coming to said minor plaintiff herein upon his arrival at legal age, and in case of his death before majority, the amount so deposited, with its accumulation, was to be paid to the San Francisco Fire Department Charitable Association. It further found that this was a legal trust, and that it was being legally administered, and that it should be enforced by the court, upon the terms and conditions designated. By its decree the court authorized and empowered the trustees to apply to the court, from time to time, as in their judgment the best interests of the minor might require, for leave to withdraw from said trust fund such *648 sum or sums as might be necessary for his proper maintenance and support. Plaintiff was denied any further relief. From the judgment thus entered he appeals. In combating the appeal, respondent first presents certain objections to the form of the action. These objections, however, are not urged with much insistence, the earnest desire of the defendant being to obtain a judicial declaration of his rights, and duties as to the fund which he has collected, and judicial guidance in the disposition which he shall make of it. In passing these preliminary objections, therefore, it is sufficient to say that the pleadings as a whole present a case of equitable cognizance. At the call of the newspaper a generous public contributed moneys for the express purpose of relieving the necessities and supporting the families and dependent relatives of the dead firemen. Upon receiving these moneys, the defendant Hearst at once became a voluntary trustee of them, charged with the duty of devoting them to the indicated objects. Though the purpose was charitable, this trust was not, in its legal sense, a public trust or “ charity.” It was a private trust, but it was a private trust in which large discretionary powers were vested in the trustee. In no strict sense was there a trustor or creator of the trust. The object and purposes of the trust are to be found wholly in the published call to the sympathetic and generous-minded public to contribute to relieve the necessities of the dependent families and relatives of the deceased, and not at all in the report of the committee. In what proportions amongst these families and dependent relatives the moneys were to be distributed, and who composed such families and dependent relatives, were questions, in the first instance, to be determined by the defendant, and, except in case of gross abuse, a court would not interfere with such determination. (Civ. Code, sec. 2269.) In fact, the defendant asked for and received the suggestion of three well-known gentlemen, and heads of departments of the municipality, and adopted the apportionment which they suggested, — an apportionment which was certainly just and equitable; and, indeed, no point is here made against the award, the minor plaintiff seeking, however, to recover into his immediate possession and control, through his general guardian, the portion of the trust fund which was set apart to him. I think it clear, however, that he has no right to such a re *649 covery, and that the utmost of his right, as a beneficiary, is to ask an enforcement of the trust in accordance with the terms of its creation. • The funds that were set apart to him having been contributed to relieve his necessities and contribute to his support, he has an unquestioned right to demand that the moneys shall be devoted to these purposes, and that they shall not be locked up during his minority, while his necessities may be the greatest. This the court recognized in its decree, when it provided that the trustees might, from time to time, make application to be allowed to expend such sums as should be found necessary for the minor’s maintenance. Objection may also be made to the provision that in the event of his death the remainder shall be given over to the Fire Department Charitable Fund Association. This might be a perfectly permissible disposition to make of the residue when the purposes of the trust shall have been accomplished, or when its object shall have failed by reason of the death of the beneficiaries; but since all the moneys were collected for the support of the families and dependent relatives of the dead firemen, these moneys could not be devoted to any other object, so long as there remained any such dependent relative. Mr. Hearst, as appears by the findings, voluntarily surrendered his trust to the three trustees named, who accepted the trust, and who have since been efficiently managing it according to their understanding of its terms. Mr. Hearst had a perfect right to resign the trust, and it would then have become the duty of the court, in the first instance, to' designate and appoint other trustees. (Civ. Code, sec. 2289.) This, in effect, though not in form, was done, for the court pronounces itself satisfied with the trustees, and commends them for their efficient performance of their duties. But, at the same time, before a binding judgment can be rendered in this case, the trustees themselves should be called in and made parties to the litigation. So, and so only, will the decree of the court be operative upon them. It may be that when advised that the terms of the trust are at variance with the suggestions contained in their report to Mr. Hearst, these gentlemen will decline to act, and it would then become the duty of the court to appoint some fit and proper person to administer the fund. The general guardian of the minor, as such, has no right to the custody and management of this trust property. It is a *650 lawful trust for A to leave a fund to B, as trustee, for the maintenance and support of C during C’s minority, and C’s general guardian, merely by virtue of his position, would have no right whatsoever to the possession and management and distribution of the corpus of such a trust fund. It is for the trustees to manage the trust fund, under the directions of the court, paying for the maintenance and support of the minor such sums as may be necessary, paying them, indeed, to the general guardian of the minor, if the court should hold such to be the advisable course, and being protected in their payments by the order of the court. But, upon the other hand, if the execution of the trust be arrested for lack of a trustee, it is proper for the guardian to apply to the court to fill the vacant trusteeship, and the court, in the exercise of its powers, may appoint any fit and proper person, whether the guardian or another, to the vacancy. But if the guardian should be appointed, he would not take the trust property as guardian, but as trustee, under the explicit terms of the trust. In contemplation of a reversal of the judgment, one other matter demands consideration. By the answer, defendant pleads no resignation of his trusteeship nor surrender of the trust, but avers that he is still in the custody, control, and management of the property. The findings of the court are as above set out,—namely, that the defendant resigned his trust to the three named trustees, who accepted the trust, and have been administering it according to their understanding of its terms. If the findings comport with the facts, the answer should be amended accordingly. It is therefore ordered that the judgment be reversed, with instructions to the trial court to permit the pleadings to be amended, to call in such parties as it may deem necessary to a complete determination of the matter, and in particular the trustees of the fund set apart for the maintenance and support of the said minor plaintiff, and enter its decree appointing trustees and defining their powers and duties under the trust in accordance with this opinion. . Harrison, J., Van Dyke, J., and Garoutte, J., concurred.