Wesleyan University v. Hubbard

I cannot subscribe to the conclusions of law reached by the majority of the Court, and, in view of the great number, and vast magnitude, of public enterprises of highest merit which originate in, and depend upon, contributions in the form of subscriptions, I believe a record of my dissent is justified.

Unfortunately, we have little aid from counsel on the question of the binding character of this subscription. Evidently this question was not emphasized in the trial court. The case seems to have been handled below as though the validity of the subscription was, for practical purposes, not controverted. In the brief here on behalf of the appellees, the question is not even referred to, while the brief of appellants does little more than casually speak of the subscription as a voluntary obligation or a nudum pactum. In oral argument, the question was only incidentally touched.

The legal quality of such subscriptions has often been appraised by the courts, particularly of those of the older and wealthier states. Certain general principles have been evolved and accepted. A subscription, or promise to donate must be based upon a legal consideration if it is to be binding.Irwin v. Lombard University, 56 Ohio St. 9, 46 N.E. 63, 36 L.R.A. 239, 60 Am. St. Rep. 727; Allegheny College v. NationalChautauqua County Bank, 246 N.Y. 369, 159 N.E. 173, 57 A.L.R. 980; Trustees, etc., College at La Grange v. Parker,198 Mo. App. 372, 200 S.W. 663; Montpelier Seminary v. Smith'sEstate, 69 Vt. 382, 38 A. 66; Phillips Limerick Academy v.Davis, 11 Mass. 113, 6 Am. Dec. 162; Grand Lodge, etc., v.Farnham, 70 Cal. 158, 11 P. 592; New Jersey, etc. Dispensary v.Wright, 95 N.J.L. 462, 113 A. 144. Some highly influential courts frankly state that they incline toward the validity of such promises wherever such holding is at all possible, and are vigilant to find a consideration which may, on any theory, be treated as sufficient, though it might not be adequate in a purely commercial transaction. Allegheny College v. NationalChautauqua County Bank, supra; Gittings v. Mayhew, 6 Md. 113;Irwin v. Lombard University, supra.

Various factors have been held sufficient by way of consideration to make the subscription legally binding. Work done, money expended, or liability incurred by the beneficiary on the faith of the subscription very generally makes the agreement binding. Typical cases so holding are:Miller v. Western College of Toledo, 177 Ill. 280, 52 N.E. 432, 42 L.R.A. 797, 69 Am. St. Rep. 242; Y. M. C. A. v.Estill, 140 Ga. 291, 78 S.E. 1075, 48 L.R.A. (N.S.) 783, Ann. Cas. 1914D, 136; Rogers v. Galloway Female College,64 Ark. 627, 44 S.W. 454, 39 L.R.A. 636; Des Moines University v. Livingston, 65 Iowa 202, 21 N.W. 564; Athol MusicHall Co. v. Carey, 116 Mass. 471; Albert Lea College v. Brown,88 Minn. 524, 93 N.W. 672, 60 L.R.A. 870; Barnes v. Perine,12 N.Y. 18; Baptist Female University v. Borden,132 N.C. 476, 44 S.E. 47, 1007; Trustees of University of Pennsylvania v. Cadwalader, 277 Pa. 512, 517, 121 A. 314. Mutual subscriptions are sufficient to support each other. AlbanyPresb. Church v. Cooper, 112 N.Y. 517, 20 N.E. 352, 3 L.R.A. 468, 8 Am. St. Rep. 767; Culver v. Banning, 19 Minn. 303;Cottage Street M. E. Church v. Kendall, 121 Mass. 528, 23 Am. Rep. 286. The benefit to the subscriber in common with the public in general, has been treated as a sufficient consideration to make a subscription enforceable. Comstock v.Howd, 15 Mich. 237; Pitt v. Gentle, 49 Mo. 74; Detroit FirstUniversalist Church v. Pungs, 126 Mich. 670, 86 N.W. 235;First M. E. Church v. Howard's Estate, 133 Misc. 723,233 N.Y.S. 451; Miller v. Ogelthorpe University, 24 Ga. App. 388,100 S.E. 784. The implied obligation of the beneficiary to preserve, apply and use the donated fund for the designated purposes has been held to be sufficiently a burden or detriment to the beneficiary to constitute a consideration to make the subscription binding. Trustees Kentucky Female Orphan School v.Fleming, 10 Bush 234; Fryeburg Parsonage Fund v. Ripley, 6 Greenl. 442, 6 Me. 442; Williams College v. Danforth, 12 Pick. (Mass.) 541; Ladies' Collegiate Inst. v. French etal., 16 Gray 196; Farmers' College v. Executors, etc.,of McMicken, 2 Disney (Ohio) 495; Detroit First Univ. Church v.Pungs, 126 Mich. 670, 86 N.W. 235.

I believe that, in the instant case, the subscription of William P. Hubbard is shown by the record to be sufficiently supported by other like subscriptions. Nelson C. Hubbard made a subscription of $11,000.00 to the same fund on the same day, and has paid it in full. Defendants introduced a letter from the treasurer of the University stating that a total of about $950,000.00 had been collected on subscriptions. No other direct evidence appears on the question. Indeed, it seems not to have been questioned below that other subscriptions were made and paid. This evidence, in the absence of any dispute, may be taken as sufficient to justify the court in proceeding on the basis that there were other subscriptions, by which the Hubbard subscription became a binding contract.

Another aspect of the case compels the same conclusion. The University, by accepting the subscription and the installments thereof which were paid by William P. Hubbard in his lifetime, became obligated to care for and preserve the funds received, and to collect the residue, and, when the fund should be complete, to maintain and use it in perpetuity for an agreed purpose. The gift thus became a benefit to the University, of course. But it also became a burden and an obligation — a detriment to the extent of the obligation and duties assumed. This detriment and burden to the beneficiary was a sufficient consideration from its standpoint to create a valid contract between it and the subscriber. In Trustees Kentucky, etc.,School v. Fleming, 10 Bush 234, the Court said: "A promissory note given for a donation intended to be made to a charitable institution is obligatory where its trustees are authorized by its charter to receive such donation, and are required to apply the fund to the charitable purpose of the institution; this obligation on their part being a sufficient consideration to uphold the promise to pay." The Supreme Court of Michigan, in Detroit First Universalist Church v. Pungs,126 Mich. 670, 86 N.W. 235, decided that: "A promise to contribute to a fund for the purchase of a church site is based on a valuable consideration, of implied benefit to the subscriber, and is a valid, enforceable contract." A like conclusion was reached in Fryeburg Parsonage Fund, etc. v. Ripley, 6 Greenl. 442, 6 Me. 442, wherein it was announced that: "Where divers persons subscribed to a fund for the support of public worship, promising to pay to the trustees of the parish funds the sums subscribed, on condition that the trustees should manage the fund in a certain manner, and apply the income thereof to the support of a congregational minister, and to the payment of the parish taxes which might be assessed on the subscribers; — it was held that the promise was binding on the subscribers; the acceptance of it on the conditions prescribed, being an engagement on the part of the trustees to perform those conditions."

If the highly logical principle thus promulgated by these and other courts is sound, there was a perfect contract between William P. Hubbard and Wesleyan University from the time his offer was accepted by the University, which acceptance is confirmed by the payments made and accepted in the donor's lifetime. Forthwith he was bound to make the payments stipulated for, and the University was equally bound to receive, care for, preserve and use the fund as prescribed. This arrangement did not constitute a nudum pactum.

Still a third viewpoint confirms this conclusion. William P. Hubbard's subscription was not an ordinary subscription. It was an agreement to pay the University the sum of $89,000.00 in consideration of which a memorial to his father, Chester D. Hubbard, was to be established and maintained by the University. In this sense the offer was not at all to make a donation. Hubbard was to receive for his money a thing personally and peculiarly valuable to him individually. The proposed memorial differs not at all in legal aspect from a physical monument to his father. Suppose the proposition had been that the University for $89,000.00 had agreed to erect a statue, a tower, a fountain, or a carillon in memory of Chester D. Hubbard and that the offer had been legally accepted. Would there then be any doubt that an enforceable contract would have resulted from such an agreement? Why does not the agreement of the University to establish a memorial to William P. Hubbard's father in the form of a chair of economics bearing the father's name amount to a binding contract as completely as though the memorial had been a physical monument?

Of course, since the chair was to be established by the very funds from the Hubbard subscription, it could not be set up until the subscription was paid, and hence, performance by the University was not a prerequisite to this suit.

The record would seem to require, however, that the cause be remanded for the reason that no marshalling of the assets of William P. Hubbard's estate has ever been made, although other free assets, particularly cash coming into the hands of the executors pending this suit, appear to be available and applicable on the Wesleyan claim, and are apparently sufficient to discharge it in full. I, therefore, would reverse and remand for this purpose.

Judge Fox authorizes me to say that he joins in this note.