Philomath College v. Hartless

By the Court, Watson, J.: The errors assigned in this case are in the findings of the court, and its failure to find upon certain issues. Of the five assignments it would be necessary for us, with the conclusion at which we have arrived, to examine only the third and fourth, but that the final disposition of the case requires that we shall also briefly refer to the first, second and fifth. The first is that the judgment was not given on the merits, and is a nullity. We do not agree to this. The action was brought to recover the amount of a promissory note. The answer denied the existence of plaintiff, the execution and consideration of the note, and the conclusion of indebtedness, and set up as a defense that it was intended merely as a gift, and was without consideration. The reply set out what plaintiff claimed to be the consideration.' The important questions submitted to the court were whether plaintiff was a corporation, whether the note was executed by defendant, and whether or not there was a sufficient consideration. The court found that plaintiff was a corporation; that defendant executed the note, but that it was without consideration. These findings are sufficient to dispose of the case on its merits. The second assignment is that the court did not find all of the issues of fact in the action. We think it found every material issue and every fact necessary to the rendition of a final judgment. It found that plaintiff was incorporated, and that defendant signed and delivered the note. It also found what was the consideration; that there was such an officer as the treasurer of Philomath College, and what was done by plaintiff in compliance with the subscription request. These -were all the material issues in the pleadings, and only the material issues need be found. (Fink v. Canyon Road Company, 5 Or. 301.) Counsel for appellant insists that the court did not pass upon the issue made by the allegation in the reply that plaintiff was induced by the request ,and subscription of defendant to purchase a large quantity of real property and to build a college thereon, and the denial of that allegation which the law presumes. This allegation merely fortifies the allega [163] tion in tbe complaint that tbe note was made for a valuable consideration by specifying what the consideration was, and was sufficiently passed upon in the finding that there was no consideration, but if it was necessary to find upon it specially, it was fully passed upon by the first, ninth and thirteenth findings, which find the original subscription request the purchase of the land, the erection of the building, and the establishment of the school. The court having found the request and performance, we do not think it was necessary for it to find in words that the one induced the other. It would be presumed. The fifth assignment is that the facts found by the court are inconsistent. No inconsistency has been pointed out to us, and we have not been able to discover any. The third and fourth assignments allege in different language the same error, and will be considered together. They state in substance that the court erred in its conclusion that the facts found did not constitute a valid consideration for the note given by defendant to plaintiff. These facts are, that defendant with others subscribed an agreement to pay three hundred dollars a year for five years to the board of managers of an institution of learning to be “built up” upon a tract of land described in the agreement; the tract of land to be purchased and the institution to be endowed with the funds so subscribed; the subscription to be tendered to the Oregon Conference of the United Brethren Church, provided that church should give her patronage and assistance in building up an institution of learning so endowed. That after said agreement was signed on the first day of May, 1865, the tract of land was purchased with a portion of the proceeds of the subscription, and the legal title vested in “trustees for Philomath College.” That thereafter the plaintiff was incorporated under the name of Philomath College; and from the time of its incorporation acted as the beneficiary of the subscription, built a college building on the land at the expense of about eight thousand dollars, and has ever since kept and maintained a school therein; that the defendant long after the plaintiff was incorporated and commenced to [164] act as the beneficiary and administrator of the subscription and its proceeds, in part payment of the sum subscribed by him, executed and delivered to the treasurer of plaintiff the note in dispute. If these facts constitute a sufficient consideration for the note, plaintiff is entitled upon the findings of fact before us to a judgment. On the other hand if they do not constitute a sufficient consideration for the note, the judgment of the court below in favor of defendant is correct, and should be affirmed. The court below found that the note was given to the “endowment fund,” and seemed to have adopted the theory.that a note given for the “ endowment” of an institution of learning is without consideration, and cannot be enforced. The question is a new one in this state, and it is important that it shall be correctly decided, for the reason that many of our institutions of learning are supported by the interest upon notes given for their endowment, and if such’ notes cannot be enforced their revenues may be diminished, and their usefulness. impaired. The law should be settled in order, not only that those already established may be provided with other means of support, but that others may not be founded upon endowments of void and worthless promises. At first view 'it would seem that when a person signs his name to a promise to pay money, or to convey property to an institution of learning, the public advantage and the fact that others have been induced by their reliance upon his co-operation to give their money and property to the same object ought to be a sufficient consideration; but the courts, acting upon the principle that every promise to be enforced must have a good or valuable consideration to uphold it, have held that something more than the naked promise to give is necessary, and that the public advantage is not of itself a sufficient consideration to support a promise. (Trustees of Hamilton College v. Stewart, 1 N. Y. 681; 2 Pick. 80.) Yet while the courts rather than violate an old and established rule of law hold that a naked promise to pay money for a„public object cannot be enforced for the want of a consideration, they have also decided with great una [165] nimity, that if the promise itself, or any other promise, upon which it is founded contains a request, or that which by any fair construction can be construed as a request to the trustees, or others representing the institution for whose benefit- the promise is made, to do any act, or to incur any expense, or to undergo any inconvenience, and such institution does the act, or incurs the expense, or submits to the inconvenience, this request and performance on the behalf of the institution, is a sufficient consideration to support the promise. (Barnes v. Perine, 12 N. Y. 18; 5 Am. Rep. 51; 20 Johns. 89; 40 Ill. 379.) Applying these principles to the facts in this case, we are of opinion that the agreement set out in the first finding implies a request to the managers of the institution of learning to be founded to purchase the tract of land therein described, and to establish thereon an institution of learning. The findings also show that Philomath College, the plaintiff herein, was founded and incorporated in order to comply with the request, and that plaintiff has in further compliance built a building at a great expense, and maintained a school therein. The defendant in giving his note to the treasurer of plaintiff, after plaintiff’s incorporation, in payment of the balance of his subscription, recognized plaintiff as the institution built up in accordance with the subscription, and as the beneficiary of the subscription. We are, therefore, of the opinion that there is a sufficient consideration for the note in dispute. An objection was made in the argument by respondent’s counsel that a college could not be incorporated at the time plaintiff is found to have been incorporated, under the first section of the act of 1864, entitled “ An act providing for the incorporation of churches and religious and benevolent societies.” We do not think there is anything in the objection. Even if the respondent here could raise the objection, we are of opinion that plaintiff was legally incorporated under that act as a literary society. We are of the opinion, also, that the note given to the treasurer of the corporation inured to the benefit of the corporation. [166] It follows from the views expressed in this opinion that the judgment of the court below must be reversed, and this action be remitted to the court below, with direction to enter its judgment upon said findings in favor of the plaintiff for the amount due upon said note, with interest.