Potts v. Longest & Tessier Co.

Ritz, Judge: The Fifth Avenue Baptist Church of Huntington, West Virginia, desiring to construct a new church building, on the 27th of Hovember, 1916, through a building committee, entered into • a contract with' the defendant Longest & Tessier Company, a corporation, for the construction of such church edifice, for the sum of $92,573.09. The contract was signed by “Fifth Avenue Baptist Church,” as well as by the individual members of the building committee, and by the Longest & Tessier Company. By the terms of this contract the contractor agreed to give bond conditioned for the performance of the contract upon its part, and the defendant United States Fidelity & Guaranty Company became surety upon this bond in the penalty of $46,286.54. The bond is payable to “Fifth Avenue Baptist Church of Huntington, West Virginia, represented by the, following duly authorized building committee appointed by the congregation of said church, J. L. Hawkins, Chairman, B. L. Hutchinson, W. L. Rece, W. L. Robinson and J. R. Marcum.” The contractor entered upon the work, but before its completion failed financially and went into bankruptcy. The bankrupt court, deeming the contract an unprofitable one, declined to direct the trustee to — 159 — complete) it. Tie Guaranty Company was then called upon by the church to complete the building, there being a condition in the bond that in case the contractor failed the Guaranty Company, if it desired to do so, should have the right to complete the contract. The Guaranty Company declined to complete the building under the contract, and the same was prosecuted to completion by the, church authorities for a sum considerably in excess of the contract price, and this suit was brought to recover upon the bond the difference between the contract price and the, amount spent by the church in the construction of the building. The suit was instituted by J. LT. Potts, J.. H. Cam-mack, Homer Bell and B,. L. Hutchinson, Trustees of the Fifth Avenue Baptist Church of Huntington, West Virginia, and a declaration was filed in their names assigning the breaches of the conditions of the bond, as above stated, and claiming damages to the amount of the penalty „ thereof. The, defendant Guaranty Company demurred to the declaration upon the ground that the trustees of the church could not maintain the suit for the, reason that their powers are prescribed by chapter 57 of the Code, and that among the powers conferred upon them is not the right to prosecute such a suit as. this, and for the further reason that the obligee in the, bond is the Fifth Avenue Baptist Church of Huntington, West Virginia, represented by the building committee named, and not the trustees, and further because the contract set up and relied upon, to secure the performance of which the bond was give,n, and also the bond, are invalid and not enforceable in a court of law. This demurrer was overruled, and the plaintiffs thereupon, asked leave to file an amended declaration, which leave the co.urlj granted over the objection of the, defendant Guaranty Company. The only difference in the two declarations 'is that in the amended declaration, in addition to the allegations contained in the original one, is the further charge that the suit is brought by the plaintiffs for and on behalf of all of the members of said church, and further that the plaintiffs are members of said church, and are the duly authorized trustees thereof, and have been regularly authorized by the congregation which consists of more than twelve hundred members to prosecute the suit. A demurrer was likewise filed to this amended declaration, the grounds thereof being prac — 160 — tically the same as the grounds for the demurrer to the original declaration, except the additional ground is assigned that by the amended declaration a new cause of action is set up, that it virtually presents a different suit from that set up in the original declaration. This demurrer was likewise overruled, and thq questions arising upon said demurrers certified to this Court for decision. It is earnestly insisted that the amended declaration presents ' a cause of action different from that presented by the original declaration, and for that reason it is urged that it should not have been allowed to be filed, the argument being that the first . declaration is filed by the trustees of the church, and the claim asserted by them* while the amended declaration seeks to assert a claim by the same parties, but in their names as members of the congregation, and on behalf of the whole congregation, and not in their character as-trustees.. It is true the amended declaration does charge that the plaintiff’s trustees are members of the congregation of the Pifth Avenue Baptist Church, and that the congregation of said church is composed of more than twelve hundred members, and that the suit is brought on behalf of themselves and all other members of the church. This does not ,make any different cause of action or seek to introduce any new plaintiffs in the suit. It is simply a more explicit statement of the representative capacity in which the plaintiffs sue, and is intended to make it perfectly plain that the language, “Trustees of the Pifth Avenue Baptist Church” is not descriptive of their persons, hut that the suit is for the benefit of the congregation of that church, and that the, plaintiffs have no interest in the cause of action other than as members of that congregation. It may be that the original declaration sufficiently showed the representative capacity in which plaintiffs were suing, but whether it did or not there could be no objection to this matter being more explicitly and plainly declared. It is urged that inasmuch as this bond is not payable to plaintiffs as trustees, but is payable- to the Pifth Avenue Baptist Church, represented by a certain named building committee, the trustees cannot maintain the action; that it could only he maintained in the name of the building committee named therein. The bond on its face shows that the members of the building — 161 — committee are not the obligees. They are, simply represented to be the agents of the church for the purpose of carrying on its building operations. The real obligee named in the bond is the Fifth Avenue Baptist Church of Huntington, West Virginia. Of course it is well known that this organization is a voluntary association for religious purposes. It cannot under our law be a corporation, and if the strict rules of the common law still prevailed the suit would have to be brought in the names of all of the members, of the congregation constituting the voluntary religious association of the Fifth Avenue Baptist Church of Huntington, West Virginia. There would be no different situation than if the bond were payable to a partnership by its firm name. 'Suit would have to be brought thereon by the individual partners trading by the designated partnership name. And the fact that it appears from the obligation that the obligee, was represented by certain agents does not constitute those agents obligees in the bond any more than would be the, case if the bond were payable to a certain business partnership represented by a certain agent duly authorized thereto. No one would evex "think of bringing suit upon such a bond in the name of the agent. So ■ in this case whatever suit may be maintained upon this bond" must be maintained bv the Fifth Avenue Baptist Church of Huntington, West Virginia, the obligee therein. But it is contended that the trustees have no authority to prosecute such a suit, for the reason that it is not expressly conferred upon them by statute, and it would necessarily follow, if this is true, that all of the members .of the congregation would have to join in the, suit as plaintiffs. There is no doubt, as before stated, but that at common law such would be the case. However, even without the aid of any statutory provisions the courts in many jurisdictions have relaxed that rule, and whe,re the number of members of the association is so great as to make it vexatious and inconvenient to join all of them as parties to the suit such suit has been allowed to be prosecuted in the name of a few of the members for the benefit of the whole .number. 23 R. C. L.,. Title “Religious Societies” § 33: Perkins v. Seigfried, 97 Va. 444; Phipps v. Jones, 20 Pa. St. 260, 59 Am. Dec. 708; Owen 1. Henman, 1 Watts and Sergeant, 548, 37 Am. Dec. 481. Under our law religious societies are per — 162 — mitted to own and bold property for limited purposes and uses. They are not permitted to engage in business for gain, or to bold property for tbe purpose of speculation or tbe, realization of profits therefrom, but tbey are permitted to own and bold sueb property as is necessary and reasonably appropriate to tbe purposes of tbeir organization. This necessarily includes buildings for tbe purpose of public worship, and such furniture and equipment as is reasonably required therefor and, of course, tbe right to own such structures carries with it the power to build them, or to contract with others for that purpose, so that tbe right of a religious society in this state to erect buildings for public worship, or to contract with others for the purpose of erecting such buildings, cannot be doubted, nor does the defendant Guaranty Company in this case doubt that the church has such right, but-the argument it makes would seem to indicate that while a church has a right to make such a contract it is entirely without authority to enforce the same in case the contractor is guilty of a bre,aeh thereof. By the provisions of sections one and two of chapter 57 of the Code, all of the property and property rights of such a religious society are vested in trustees appointed under the¡ provisions of that chapter. It will be noted that the title of real estate, by the terms of § 1 of the chapter, is vested in the trustees, and by § 2 the title to all books, furniture or other personal property that shall be acquired for the benefit of such society to be used on the land in thq ceremonies of public worship, or at the residence of their minister, shall be vested in the trustees, and by the provision of § 7 said trustees are given authority to institute and prosecute such suits as may be necessary to vindicate the property rights vested in them by sections one and two. But it is insisted that the cause of action involved here is not such a right as is vested in the trustees under the provisions of sections one and two. It is a right which grows out of the breach of a contract for the construction of a building upon a lot, the title to which is vested in the trustees, and which building when constructed would, under the provisions of the law be, vested in said trustees. As before stated, the power of the church to make this contract cannot be denied. Having the authority to own buildings for the purpose of public worship, it necessarily has the power to ac — 163 — quire the same either by purchase or by having the same built for it under .contract. The church is authorized to use its funds only for its religious purposes, and these religious purposes are limited by law to the purchase of real estate or personal property to be used in connection with such real estate, and to vindicate! any infraction of those rights the trustees are given the power to maintain suits. Any recovery in this case woiild go for the purpose of either assisting in paying for the building . erected upon the property, or in acquiring means to be use,d for the religious objects of the congregation. The chose in ac- ' tion which the church has is for the benefit of the congregation, and to be used only for the purposes prescribed by law. This being true, the legal title thereto under sections one and two of chapter 57 of the Code, is vested in the trustees. The manifest purpose of that legislation was to vest title to all property which a religious society might hold in trustees, so that there would be a clear well defined method of vindicating the rights of the congregation to such property without resort to the vexatious proceeding of having all of the members of the congregation join in a suit, or the questionable proceeding of having the suit brought by a committee on behalf of themselves and all other members of the association. This right of action is as much property of the church to be used on its land in connection with the public worship conducted by it as any other property it possesses. It cannot under the law be used for any other purpose/ The defendant Guaranty Company further insists that the contract entered into by the church with the defendant Longest & Tessier Company, and also the bond given to secure the performance of that contract, are invalid, for the reason that the church could not make such a contract through a building committee. It is not questioned that it is such a contract as the congregation could malee, and this being true it is difficult to understand why the congregation might not appoint suitable agents for the purpose of acting for it. Then again, the obli-gors in this bond cannot deny the, authority of the committee to act. The contract is such a one as the church had a right to make, and the bond reciting that the committee was duly authorized to that end, the obligors are estopped to deny, its rq164 citáis or tlie authority of the committee to act in the premises. Shull v. Guaranty Co., 81 W. Va., 384; Beardsley v. Ashdown, 73 W. Va. 132; Town of Point Pleasant v. Greenlee, 63, W. Va. 207; Talbott v. Curtis, 65 W. Va. 332. It follows from what we have^said that the Court below committed no error in overruling the demurrers to the original and amended declarations, and we answer the, questions certified accordingly. Affirmed.