General German Aged People's Home v. Hammerbacker

Stone, J., delivered the opinion of the Court. The object of the incorporation of “ The General German Aged People’s Home of Baltimore City” was certainly a commendable one. Its aim was to furnish to aged and indigent Germans a homo for the residue of their lives. It was intended for those only who were over sixty years of age, who were unable to work, and possessed of a good character,-and without the means to secure for themselves a comfortable home. But with all these requisites before an applicant could be admitted, an admission fee, ranging from $300, the highest, to $150, the lowest, must be paid. This admission fee might be paid by the applicant himself, if he possessed sufficient means, or by his friends or relatives, if he was unable to do so. Another requisite for admission into the institution was, that the applicant should transfer to the institution all the property that he had at the time. It is this latter provision that creates the difficulty in this case, and which will require examination. It is the primary purpose of this corporation to furnish homes for those who are unable to ’support themselves in any degree of comfort, and not for those who are so able. It is not its object to furnish for the small admittance fee of $300 or $150 a home for life to those who still hold property, to do as they please with. To allow that would be to convert the institution into a very cheap — 604 — boarding-house, where, in addition to comfortable board and lodging for life, the inmate would be entitled to medical attendance if sick, and a decent bnrial at his death, and all this for $300'at most. But there is and must be a large class of persons, who own and possess more property than enough to pay the admission fee, but not enough to support themselves in the comforts they would find at the Home. It was for this class that the provision in the constitution (Art. 5, sec. 2, paragraph c) required the inmate to transfer to the corporation all the property he might have, and it is this provision that is supposed to be ultra vires. But in our opinion it is not. The certificate of incorporation provides, “ That the corporation so formed, is a corporation for the purpose to establish and maintain in the City of Baltimore, or within its vicinity, an institution under the name of ‘The General German Aged People’s Home,’ wherein aged people of both sexes, of good moral character, under such 'conditions and rules as may be prescribed by the constitution and bylaws of this corporation, may find an asylum.” Among the rules. laid down in the constitution, is the one heretofore referred to, that one of the conditions of admission was. the transfer to the institution of all the property of the applicant. The general corporation law of the State provides that every corporation incorporated under the general law, shall possess certain powers, and among these enumerated powers, is the right to acquire by purchase, or in any other manner not inconsistent with law, any property which is necessary0 or proper to enable such corporation to fulfil the purposes named in its certificate of organization. (See sec. 48 of Corporation Law.) Under this general law, the corporation would be entitled to receive property, unless it was inconsistent with law, or unless the constitution and by-laws of this corporation forbade the acquisition of property in that mode. — 605 — But the constitution provides that the revenues of the corporation should be derived from the yearly dues of members, admission fees, donations, presents, legacies, and gifts. Now under this clause, to say nothing of the general law, a person, not an inmate or applicant, could certainly donate or give property or money to the institution. If A, not an inmate, presented the corporation with 81000, no one would doubt its power to receive it, under the head of a voluntary donation or gift. It certainly would be a hair-splitting rule to say that if B, who was an inmate, or an applicant, did the same, it would not be a donation or gift. It is not a purchase, for the inmate gets his right to be there, from his age, his good moral character, and the payment of his admission fee. He may not have a cent of money or property to convey, but if the other conditions are complied with, he is admitted. It is as properly classed as a voluntary donation, in the one case, as the other. But it is argued, that such conveyance of property is against public policy. But public policy does not forbid the purchase of an annuity. By the payment of a sum in gross, the annuitant obtains a certain sum of money annually as long as he lives. This is much practiced in England, and somewhat in this country, and has never been held to be against public policy. There is no difference in principle between receiving a sum of money annually for life, and a home, including board and clothing, for life. If an applicant has money or property, the income of which is not sufficient to support him or her, in as much comfort as they can get at this Home, it is certainly not against public policy for them to dedicate it to securing to themselves the advantages of this institution. Indeed, where the applicant has no one depending upon him, it is commendable in him to do so. Nor is it against public policy for an organized charity like this to receive such donations, it being, as we have — 606 — shown, within its corporate powers. On the contrary, this and similar charities are directly within the line of a sound and humane public policy. They not only tend to relieve suffering in the individual, hut tend to keep them from being a charge upon the general public. Eor this purpose money is necessary, and they are allowed to receive and appropriate it as their charter allows. But if we were in error about this, under the decision of this Court, in the case of The United German Bank, use of Clendenin vs. Katz, 57 Md., 128, the defendants would he estopped from setting up such defence. In that case the defendant set up as a defence to the note sued on, and which had been discounted by the bank, the want of power in the bank so to -do. But while the Court said that the bank had no such power, the defendant, having received the money, such defence was not available to him. That where the contract has been executed, by the plainest rule of good faith it should he permitted to stand. That although a corporation may act in disagreement with its charter, yet a party who has had the benefit of the agreement, cannot he permitted to question its validity. We shall see hereafter that this agreement was fully executed by the complainant, and therefore neither Zolles, nor those claiming under him, can now set up such defence. But our opinion as to the power of this corporation to require the applicant to convey to it all his property, must be confined to property owned and possessed by the applicant at the time. As to its power, by bond or otherwise, to enforce the conveyance to it of any future acquisition of property, it is not necessary for us to express any opinion, as that question does not arise in this case ; the whole property now in dispute being owned-by Zolles at the time of his application for admission. We may say that some different principles might govern the case of future acquisitions. — 607 — The facts in this case are few and plain. One Zolles applied for admission into this Home. He acknowledged that he knew the rules of the institution relative to his admission, and assented to the same. He declared in writing that he had no property, except the sum of $300, his admission fee, and that he was willing to transfer all his property to the institution ; and being found otherwise qualified he was admitted. He died in the institution in about a year and a half afterwards. After his death, the institution discovered that he had given them a false account of his property, and that he had some twelve hundred dollars in money and notes, which his administrators now claim, and threaten to sue for. That Zolles practiced a fraud upon, the institution is manifest from this statement. He did know the rules^ and he made the most solemn declaration in writing that he had-no other property beyond the $300. Had the appellants known of the money he had, they would not have admitted him to the Home until he had conveyed it to them by proper legal conveyance. But believing his statement, which was vouched for by two others beside himself, they did not deem it necessary to take a conveyance of property, when they believed there was none to convey. The question then is, shall the representatives of Zolles now derive a benefit from his fraud? The appellants have performed the whole of their agreement with Zolles. They gave him a comfortable home for his life, proper attendance when sick, and a decent burial after his death. That equity will consider that as done which ought to have been done, is too well settled to need a reference to authorities. The recent case of the Equitable Gas Light Company of Baltimore vs. Baltimore Coal Tar and Manufacturing Co., 63 Md., 285, was a case where there was a fraudulent refusal to execute a written contract, and the Court said : — 608 — “ This agreement was of a distinctive character, and was looked to by both the contracting parties at the time as essential to the security of their rights. To allow either of the parties to evade its liability and get the advantage of the other by resorting to such a fraudulent subterfuge as that charged upon the defendant, would be against all equity and conscience, and such as no well-adjusted system of jurisprudence could tolerate. The authorities, we think, fully warrant a Court of equity in the exercise of its jurisdiction in such case, to enforce the production of the contract fraudulently withheld, to the injury of the plaintiff, or to enforce the due and proper execution of the contract, if such execution be fraudulently and luithout justifiable excuse delayed, to the injury of the plaintiff;” and in support of that position, several authorities are referred to. That a Court of equity will decree the specific performance of a contract where the execution was prevented by fraud, is very clearly laid down in that case. While Courts of equity do not specifically enforce contracts in' respect to personal property, with the same facility as contracts relating to real estate, because in the former case, the Courts of law are generally competent to afford relief, yet whenever the party cannot have at law a full and satisfactory remedy, a Court of equity will grant relief. 2 Story’s Eq., sec. 717; Alexander vs. Ghiselin, 5 Gill, 138; Sulivan vs. Tuck, 1 Md. Ch. Dec., 59; Triebert vs. Burgess; et al., 11 Md., 452. In this case it is clear that the complainants can have no full and adequate remedy at law. The complainants, by reason of the fraud practiced by Zolles, have not a legal title to the property, such as would enable them to maintain an action at law. Their title is an equitable one, and relief, therefore, can only be obtained through a Court of equity. If this property was delivered over to the administrators, and the complainants forced to file a bill against — 609 — them, it would only be a needless circuity of action and anunnecessary expense. (Decided 10th March, 1886.) We are, upon the whole case as made by the bill, of opinion, that if the allegations are sustained by the proof (this case being upon demurrer,) or admitted by the defendants, the complainants are entitled to relief, and the decree sustaining the demurrer and dismissing the bill, should be reversed, and the case reminded for further proceedings in conformity to this opinion. Decree reversed, and case remanded. Miller, J"., dissented.