Reisig v. Associated Jewish Charities

Melvin, J., delivered the opinion of the Court. The appellants are the leasehold owners of property in Baltimore City, 1916 East Thirty-first Street, in ⁴³⁴ which the appellees hold the reversion, as beneficiaries under a codicil to the last will and testament of the late Miss Eleanor S. Cohen, of that city. In response to due notice from appellants of their desire to redeem this interest and to acquire thereby the complete fee-simple title to the property in question, both of the appellees tendered their respective deeds and disclaimed the necessity for the appointment of a trustee to accomplish that end. The appellants (plaintiffs below) in their bill of complaint raised the point that a trusteeship is necessary because of the alleged fact that one of the appellees, The Hebrew University of Jerusalem (the correct legal title of which is “The Hebrew University Association”), is an unincorporated association and as such cannot hold or convey real property in Maryland.

It is not disputed that the New York corporation it chose as its channel for transferring the title to appellants, — the “American Friends of The Hebrew University, Inc.”,— to which it executed its deed in February, 1942, is legally qualified to pass a valid title, as it offers to do, or that the other appellee, The Associated Jewish Charities of Baltimore, is likewise qualified. ■ The issue in the case is, therefore, confined to the legal status of the particular appellee which is located in Palestine. The court below held that a valid title could pass through' the proffered deed, without the intervention of a trustee,' and it is from this decree that the leaseholders have appealed. In their admirable presentation of the case counsel for both sides have greatly facilitated the court’s determination of the nice questions of title involved, concerning the applicability of the laws of Palestine and the laws of Maryland to a situation which is unusual, if not unique, in this jurisdiction. The facts of the case are undisputed.

The devisor of the ground rents, Miss Eleanor S. Cohen, in a carefully prepared will and in. an equally carefully-prepared codicil thereto, made plain, her desire and intention to execute a charitable trust for the benefit of her coreligionists in Palestine, Baltimore and elsewhere. To ⁴³⁵ that end, she devised in her will her residuary estate to Dr. Harry Friedenwald, of Baltimore, Maryland, with the late Justice Louis D. Brandéis as an alternate devisee, eoupled with the request, however, that the same may be used “for my co-religionists in Palestine, Baltimore, or wherever he may consider that most good can be accomplished.” That will was dated April 18, 1934, and under date of November 1, 1935, Miss Cohen made the following codicil to it: “By my will I have devised and bequeathed my residuary estate to Dr. Harry Friedenwald, or alternatively to Justice Louis D. Brandéis, with the intent and purpose that the same be used for the benefit of my co-religionists in Palestine, Baltimore or elsewhere. As I am advised that such disposition of my residuary estate might subject my estate to greater taxation upon my death than would be the case if I had devised and bequeathed my residuary estate to a corporation, I do therefore now modify such disposition of my said residuary estate by devising and bequeathing one-half of the same to The Associated Jewish Charities of Baltimore and the other half thereof to The Hebrew University of Jerusalem; to be applied to the respective purposes of said corporations.” Miss Cohen died in August, 1937, and the devise of her residuary estate became effective in due course thereafter, apparently without any question having been raised until the filing of this suit. It is quite evident that when she named in her codicil these two particular devisees, in lieu of the individuals named in her will, she had no other thought in mind than that said devisees were both bodies corporate and thus entirely free to operate as such in carrying out her expressed intention.

When it subsequently developed that the correct nomenclature of The Hebrew University of Jerusalem is The Hebrew University Association, that made no difference legally, but only directed the court’s inquiry to the status of the association instead of the university. In order to establish this status two thoroughly competent witnesses — one of them an expert on Palestine ⁴³⁶ law — were presented, and their testimony with the documentary evidence, clears the path of legal difficulties in the way of transferring a valid title by both of these devisees, without the appointment of a trustee. The testimony of this expert, Mr. Haim Margalith, whose qualifications are conceded, as well as that of Mr. Salmann Schocken, chairman of The Hebrew University of Jerusalem, is altogether of a most enlightening character and leaves no doubt that The Hebrew University Association is to all intents arid purposes an organization of such nature as to qualify it to hold and transfer title to real property in Maryland. It is, as Mr. Margalith describes it, “a legal entity, a juridic person,” and is so recognized by the authorities in Palestine.

This association was formed in 1925 for the sole purpose of governing and dealing with The Hebrew University at Jerusalem. The members of the association are the members of the board of governors of the university, and for an association which was organized, and continues to function, under the law covering associi tions of Palestine, otherwise known as “The Law of S( cieties.” As Mr. Margalith states, this law is used t a large extent by various philanthropic and educations organizations where there is no profit-making in view. Rules of each of such associations are required by law to be filed promptly after organization with the office of the district commissioner of each district, one of which is Palestine, and kept there on file; also, various changes that take place subsequent to the time of organization are to be reported to the district commissioner’s office. The Hebrew University Association, having been thus organized, formulated its rules and filed them with the district commissioner at Jerusalem, as required.

It thus became an association organized and functioning under the law of societies. This law became effective in 1909 under the Ottoman regime and is one of the laws which were retained when Palestine came under the mandate granted to Great Britain after World War No. 1. In ⁴³⁷ 1922 the Palestine Order in Council was promulgated, which provided, among other things, for administration of the laws of Palestine in conformity with the common law and the doctrines of equity in force in England. In this situation, the courts of Maryland are specially required to take judicial notice of this foreign law and to apply it to the facts of the particular case, “as would be proper if such foreign law were domestic law.” Article 34, Secs. 56-58, Annotated Code of Maryland.

Under this law of Palestine The Hebrew University Association, by its duly registered and certified rules, was authorized on behalf of the University of Jerusalem: “(c) to solicit, secure and accept gifts, endowments, bequests, contributions and subscriptions, and to administer and dispose of the same; (d) to borrow or raise money without security or secured with mortgage or other charge on all or any of the property and assets of the Association, and to redeem or pay off any such securities.” These rules also provide for an executive council which, subject to the control of the board of governors, shall have the “management and administration of the revenue and property of the Association, the conduct of its affairs, the custody and use of the common seal, and, in particular, but without derogating from the generality of the aforegoing powers, it shall have the following powers, viz: to borrow and raise money, as hereinbefore expressed, and “(2) to invest any monies of the Association (including any trust funds vested in, or entrusted to, the Association) in any such manner and from any such securities as the Association may do, and from time to time to realize or vary such investments * * *.” Without quoting from the various provisions of the law covering associations, as referred to in the testimony of the two witnesses in the case, it is sufficient to say that, based on an examination of this law, as expertly interpreted by them, this court has reached the conclusion, and so holds, that under the law of Pales-; tine this appellee had the legal right to receive and hold ⁴³⁸ for The Hebrew University of Jerusalem the one-half interest in the ground rent in question. It was in keeping with the objects for which the association was formed, and whether or not this gift or devise received the authorization from the government of Palestine, as required by Article 17 of the law, is beside the point. That provision was invokable alone by the government, and no objection having been raised from that source, the validity of the devise is not affected thereby, so far, at least, as the purpose of the pending suit is concerned. Having thus acquired a valid title the association has, under that same Article, the power of sale or disposition of this ground rent, so as to convert it into funds of the Association.

In addition to this application of the law, it is to be noted that any limitation imposed by it upon the right to hold and dispose of real estate has no extra-territorial force. Fletcher Encyclopaedia, of^ Corporation Law, Permanent Edition, Yol. 17, Sec. 8321; Waters v. Order of Holy Cross, 155 Md. 146 , 142 A. 297 . As stated in the former authority, and affirmed for Maryland by the latter, “it is a general rule that the statute of wills of a state is no part of the charter of a corporation created by such state and has no extraterritorial operation, and therefore, where a corporation has the general power under its charter to take and hold real estate, the fact that the statute of wills of the state of its creation prohibits devises to corporations or imposes restrictions upon such devises, does not prevent it from taking by devises in other states in which devises are allowed * * *. And this rule is in accord with the settled doctrine that the right of a corporation to hold land, and