Cass v. Yale University

Mr. Justice Adams

delivered the opinion of the court.

The contest here is solely between appellant, the owner of the second note and trust deed, executed January 12, 1894, and Yale University, the owner of the first note and trust deed executed October 13,1891. Appellant’s counsel contend that Yale University, a corporation, had no power to purchase the note and trust deed in question from Peabody, Houghteling & Co., and, therefore, that the purchase was void, and appellant is entitled to a first lien on the premises described in the trust deed. Whether such purchase was ultra vires Yale University is the main question to be decided.

Yale College was chartered May 9, 1745, by the “ Governor and Company of His Majesty’s Colony of Connecticut, in Hew England, America.” The charter, after reciting that October 9, 1701, the said Governor and Company granted to certain named persons, and to their successors, full liberty, right and privilege" to erect, etc., and at all times, in all suitable ways, to encourage a collegiate school; and that, in pursuance of said grant, Yale College was founded, and that the general court of the colony, in 1723 enlarged said powers and privileges, and certain named persons, trustees, etc., have petitioned that said school, with all its rights, power and privileges, may be confirmed, and that such additional powers may be granted as may be necessary for the ordering and managing of said school in the most advantageous and beneficial manner; it is enacted, ordained and declared that certain named persons and their successors shall be a body public and corporate by the name of “The President and Fellows of Yale College in Hew Haven,” and shall, among other things, be capable in law “ to have, take, possess, acquire, purchase, or otherwise receive lands, tenements, hereditaments, goods, chattels, or other estates, and the same lands, tenements, hereditaments, goods, chattels or other estates, to grant, demise, lease, use, manage, or improve, for the good and benefit of the said college, according to the tenor of their donation, and their discretion.”

The charter also contains the following:

“ That the president and fellows shall have due government, care and management of the said college and all the matters and affairs thereunto belonging.”

The charter exempts from taxation the lands and ratable estate belonging to the college, not exceeding the yearly value of five hundred pounds, and the persons, families and estates of the president, professors and the persons of tutors, students, etc., of the college, and granting to the college, in lieu of all former grants, one hundred pounds silver money, at the rate of six shillings and eight pence per ounce, payable half yearly.

May 4, 1834, the following act was passed by the legislature of Connecticut:

“ Be it enacted by the Senate and House of Representatives in general assembly convened, that the fund which has been or may hereafter be granted, provided by the State of Connecticut, or given by any person or persons to the corporation of the president and fellows of Yale-College in New Haven, and by them invested and held for the use of that institution, shall, with the interest thereof, be and remain exempt from taxation. Provided, however, that the said corporation shall never hold in this state real estate free from taxation, affording an annual income of more than six thousand dollars; and provided also that the private property of the officers of the institution shall not be exempt from taxation; and that the said corporation shall, on or before the first day of September, A. D. 1834, give its assent to this act, and transmit the evidence thereof to the secretary of the state, to be by him recorded.”

By an act passed July 6, 1871, the name of the corporation was changed to “Yale University.”

The powers granted by the incorporation act of 1745 are very comprehensive and large discretion is granted to the corporate authorities. The language is “to have, take, possess, acquire, purchase, or otherwise receive lands, tenements, hereditaments, goods, chattels, or other estates, and the same lands, tenements, hereditaments, goods, chattels, or other estates, to grant, demise, lease, use, manage or improve, for the good and benefit of the said college, according to the tenor of donation and their discretion.” Under this grant of powers there can be no doubt that the corporation could acquire any property whatever, and dispose of the same as to its managing officers might seem proper “ for the good and benefit of the corporation,” limited only by the terms of the donation, in cases in which the property was acquired by gift or donation. The word “chattel” includes every species of property, movable or immovable, which is less than a freehold, and the ■ word “goods” includes stocks, bonds, notes, money, etc. Bouvier’s Law Dictionary. The act of 1834, above mentioned, recognizes the power of the corporation to invest the fund mentioned in the act by providing that, when such fund is invested, it shall be exempt from taxation. It is recited in the charter of 1745 that gifts, grants, bequests and donations of lands, tenements, hereditaments and goods and chattels had theretofore been made to the college, and, by the act of 1834 the same is recognized, and further, it is anticipated that thereafter there would be other like donations and grants, and that act, as before stated, expressly recognizes that the fund created by such grants and donations may be invested. It is not contended that the act of 1834 was not assented to by the corporation. We think it clear that the corporation, by virtue of its charter and the act of 1834, had ample power to invest its funds, by purchasing notes, bonds and mortgages. The purchase of the note and mortgage in question was an investment. Jennings v. Davis, 31 Conn. 134; Savings Bank v. Barrett, 126 Cal. 413.

The decree will be affirmed.