Mutual Benefit Life Insurance v. Rector, Wardens & Vestrymen of Grace Church , 53 N.J. Eq. 413 ( 1895 )

The Chancellor.

I am unable to find, in the acceptance of the deed from Mr. and Mrs. Mills, anything that will justify the implication of a covenant upon the part of the church corporation with the grantors of the land, which so obliges it to pay the mortgage that its failure to do so will amount to a breach of either of the conditions contained in the deed. Nor do I find that the allegations of the cross-bill charge such a collusive production of the foreclosure sale as will, if true, amount to a breach of either condition. In connection with the fact that Mr. Davison is .not attempting to sell the land under his judgment, but is merely insisting, in this suit, upon his right to payment out of the surplus proceeds of the foreclosure sale, I look upon the charge of collusion in the cross-bill as nothing more than an averment of a friendliness between the church corporation and Mr. Davison, which has not taken such shape as can amount to a breach of condition. It is not charged that either the church or Mr. Davison has procured the complainant to foreclose its mortgage and thus bring about a sale, and I do not understand that a mere desire that Mr. Davison shall be paid out of the proceeds of the foreclosure sale, however strong that desire may be, can amount to a breach of condition. Hor can the unnecessary assent of the church, in its answer, to the foreclosure sale, which it is unable to prevent, amount to such breach.

It is to be remembered that conditions subsequent are not favored either in law or in equity, and that they are, therefore, to be strictly construed. Den v. Lawrence Church, Spenc. 555.

How, is the foreclosure sale to be regarded as a breach of either condition of the deed ?

I think not, for three reasons — -first, because the sale is one which the deed from Mr. and Mrs. Mills contemplates and assents to as not being within the condition or limitation; second, if the sale be not expressly assented to, it is not a voluntary sale by the grantee, but a sale in invitum, against which the condition will not be held to be directed (4 Kent Com. 184); and third, because the condition or limitation, which is designed to restrain altogether alienation of land, imposed in the deed by which the land is granted in fee, is repugnant to the nature of the estafe granted, and void. 4 Kent Com. 134; Magie v. German Church, 2 Beas. 79; affirmed on appeal, 2 McCart. 500; 2 Washb. Real Prop. 9; 2 Dev. Deeds § 965; Gray Res. Al. §§ 13, 23, 43, 279.

There is, then, a sale which does not amount to a breach of condition, but which effectually puts such a breach beyond future possibility.

It follows that, as the breach can never happen, the title of the church corporation to the surplus proceeds of sale has become absolute, and they may be taken by its judgment creditor.

I have considered the insistment of Mr. Mills, that the deed should be regarded as establishing a charitable use, to which the .surplus proceeds of sale should be devoted. The purpose of the deed, as shown by that instrument itself and as reiterated in the allegations of the cross-bill, was to give to a religious corporation a certain lot of land so long as it should be devoted to a specified use. The deed attempted to procure the fulfillment of that purpose, not by expressing, as the intent of the grantors, that the deed should be to the church corporation in trust, irrevocable reliance being had upon remedies for the enforcement of that trust, but by the imposition of conditions designed to defeat the gift if their terms should be violated; and the obvious reason for this form, as is exhibited by the cross-bill, was that the grantors of the lot did not contribute all that was required to establish the church, but a part only, which part they had the right to give upon condition, and have it returned to them upon the breach of the conditions they imposed.

I cannot find an intent to create a trust and thus bring the case within the decisions which construe the conditions into mere regulations of the trust and so maintain the gift as one to a charitable use.

I will grant the motion to strike out the cross-bill.