Wesley Home, Inc. v. Mercantile-Safe Deposit & Trust Co.

Sweeney, J., delivered the opinion of the Court. This is an appeal from a decree of the Circuit Court of Baltimore City (Perrott, J.), filed June 24, 1971, in an action instituted by Mercantile-Safe Deposit and Trust Company, sole surviving trustee under the Will of Virginia Van Rensselaer Jacques, deceased. The events culminating in the present appeal began on August 11, 1911, when Mrs. Jacques died leaving a Will that had been executed on February 11, 1911. The first four paragraphs of the Will contained certain specific bequests, not of interest here.

The fifth paragraph created a trust, and it is the disposition of a portion of ¹⁸⁸ the residue of the trust fund which is now at issue. The pertinent portion of the Will is as follows: “5. All the rest and residue of my estate, real, personal and mixed, and wheresoever situated, I give, devise and bequeath unto the ‘Safe Deposit and Trust Company of Baltimore’ and JAMES M. JACQUES and the survivor of them, their successor or successors in the trust, in special trust and confidence, nevertheless, to collect and receive the issue, rents and income thereof, and after paying the taxes and necessary expenses thereon, to divide the net income into six equal parts. “Three-sixths or one-half of said net income I hereby direct to be paid unto my beloved husband, JAMES M. JACQUES for and during his natural life: One-sixth of said net income I direct to be paid to my daughter-in-law, MARY R. LLOYD, for and during her natural life: One-sixth of said net income, I direct to be paid unto my granddaughter, GERTRUDE LLOYD, for and during her natural life: One-sixth of said net income, I direct to be paid unto my granddaughter, CLARISE ALVA CRAWFORD, for and during her natural life. And from and after the death of any of the said JAMES M. JACQUES, MARY R. LLOYD, GERTRUDE LLOYD and CLARISE ALVA CRAWFORD, I hereby direct that after and as each of them shall die that the share of the income which would have been paid to the deceased, if living, shall be added to and become a part of the corpus or principal of said trust fund until said trust shall cease as hereinafter provided; and from and after the death of the survivor of all of said JAMES M. JACQUES, MARY R. LLOYD, GERTRUDE LLOYD and CLARISE ALVA CRAWFORD, the said trust shall cease and the corpus or principal of the trust fund, as ¹⁸⁹ then constituted, shall be divided by said Trustees into two equal parts; one part or one-half of said trust fund, I give, devise and bequeath unto ‘The Hospital for the Women of Maryland of Baltimore City’ and the ‘City Hospital of Thomasville’, Georgia, share and share alike. “The other one part or one-half of said trust fund I give, devise and bequeath unto ‘The Anchorage of Baltimore City’, ‘The Home of the Aged of the Methodist Episcopal Church of Baltimore City’ and the ‘Home for Incurables of Baltimore City’, share and share alike.” The last surviving life tenant died on April 24, 1967, and the trust thereupon terminated.

No controversy exists at present pertaining to that part of the residue which was to be distributed between the two hospitals, and two of the three charities designated to take under the second part of the trust fund are clearly entitled to their share, and have been paid. A dispute exists, however, as to whether the other named charity, The Anchorage of Baltimore City (Anchorage), is entitled to receive its allotted share. The heirs at law of the testatrix allege that the Anchorage has, in fact, ceased to exist, and that an intestacy results as to its portion of the trust estate. They urge that the sum allotted to the Anchorage should, therefore, be paid to the executors of the Will, for the benefit of the heirs.

The other two charities named to share in that portion of the trust: The Wesley Home, Inc., formerly The Home of the Aged of the Methodist Episcopal Church of Baltimore City (Wesley), and The Home for Incurables of Baltimore City, also known as The Keswick Home (Keswick), join the heirs in urging that the share in question not be paid to the Anchorage, but argue that it should be divided between Wesley and Keswick. The Anchorage asserts that it is still legally in being and entitled to receive its designated share, for transmission to the Young Men’s Christian Association of the ¹⁹⁰ Greater Baltimore Area (YMCA) under the terms of an agreement to be discussed in further detail later herein. To resolve this dispute, Mercantile-Safe Deposit and Trust Company, surviving trustee under Mrs. Jacques’ Will (Mercantile), filed its bill of complaint, seeking a determination as to which of the various claimants were entitled to take and in what amounts. By his Decree, the judge below found that the Anchorage and its successorassignee, the YMCA, were entitled to receive the money in question.

From that Decree the other claimants have taken this appeal. In order to understand the background of the present dispute, a review of the history of the Anchorage would appear to be in order. The Anchorage was incorporated on February 20, 1908 for the stated purpose of . . maintaining under Christian influence a boarding house and Home for Seamen while in port, and any other work for them that may grow out of it, to aid and uplift the men of the sea . . .”. The Charter was duly recorded among the chattel records of Baltimore City in Liber S.C.L. 48, folio 208.

Staffed by both paid and volunteer personnel, including the voluntary services of the testatrix on an occasional basis in the several years prior to her death, the work of the Anchorage was conducted in a building owned by the Corporation on Thames Street in Baltimore City. For approximately twenty years the organization functioned without major difficulty, although apparently with continuing financial pressures. The record reveals that the institution was, indeed, a haven for seamen and a source of great assistance to them. The principal activity of the Anchorage consisted of providing lodging and meals, at reasonable rates, to seamen in port, but it also extended into such other humane areas as visiting sick sailors in local hospitals; visiting and attempting to secure the release of seamen incarcerated in jail, and seeking employment for seamen by working in coopera ¹⁹¹ tion with shipping companies and labor unions.

No charge was made for the latter services. The organization was also active in attempting to locate missing seamen, and even conducted funeral services for those who died in port, burying them, when necessary, in a plot located in Parkwood Cemetery. The record reveals the extent of the Anchorage’s activities by indicating that 45,955 seamen were entertained in the Thames Street facility in 1928. During the decade of the Twenties, faced with the imminent retirement of the Superintendent and with recurring financial problems, the Board of Directors of the Anchorage began negotiations with the YMCA towards the end that the YMCA might take over its operations.

Tentative agreement was reached in 1929 and the YMCA assumed management of the Anchorage on July 1st of that year. A contract between the two organizations was finally approved under date of April 17, 1930 and a deed conveying the fee simple property of the Anchorage to the YMCA was executed on April 7, 1932. This deed is recorded in Liber S.C.L. 5294, Folio 492, and was subsequently approved by the Maryland Legislature. It granted to the YMCA: “[A]ny and all other assets of every kind and description, whether real, personal or mixed, which The Anchorage of Baltimore City may hold title to or possess, or to which it may be entitled to under any existing will already probated, together with any gifts, legacies or devises which may be given or left to The Anchorage of Baltimore City by will or otherwise at any future time, it being the intention hereby that The Young Men’s Christian Association of Baltimore shall, by this deed, acquire and hold title to all of the assets of The Anchorage of Baltimore City of which it is now seized or of which it now has possession or of which it shall at any time in the future be seized or have possession.” (Emphasis supplied) ¹⁹² From 1929 until 1955, the YMCA continued the operation of the Anchorage under the name of “The Seamen’s Branch of the Young Men’s Christian Association”.

It appears to be uncontroverted that during this quarter century the YMCA, in every substantial particular, carried on the work formerly conducted by the Anchorage management. Indeed, in 1941, under the auspices of the YMCA, lodgings were provided at the Seamen’s Branch for 54,253 seamen, and an additional 151,887 used the premises for some purpose other than lodging. The activities of the Seamen’s Branch continued at a high level throughout World War II, but it appears that the end of that war and a variety of other factors brought about a dwindling of the demand for the services of the facility. There was a great decline in the amount of American shipping after the war, and the nature of the Port of Baltimore underwent considerable change in that period.

Additionally, there was a substantial change in the life style of merchant seamen, as more were married and had homes of their own, and modern day transportation made it possible for them to return to those homes between assignments. Seamen as a whole were paid higher salaries than they had received before the war, and could afford more elaborate facilities than those offered by the Seamen’s Branch. The Thames Street facility was quite old and not in good general condition, and the neighborhood in which it was located had undergone substantial deterioration. The death blow, however, appears to have been dealt when the Community Chest, after a study made by the Council of Social Agencies, withdrew its financial support for the Seamen’s Branch of the YMCA’s operations.

On February 2, 1955, the Executive Secretary of the Seamen’s Branch wrote to the National Council of Seamen’s Agencies of the United States and Canada, advising them of the imminent closing of the facility, and the minutes of the meeting of the Board of Managers of the YMCA, dated April 15, 1955, indicate that the branch ceased to operate as of that date. ¹⁹³ Even though it turned over to the YMCA title to all its assets and supervision of its operations, the formal corporate existence of the Anchorage was never officially terminated. Although no State or federal reports or returns of any kind have been filed since 1932, three Board of Director’s meetings have been held since then, at each of which the only business transacted was the filling of vacancies which had occurred on the Board. The minutes of these meetings show that the reason for maintaining the corporate existence and not forfeiting the Charter of the Anchorage was to avoid any complications with reference to any endowments or legacies which may have been written in wills naming the Anchorage as beneficiary. In fact, in 1934 the Anchorage did receive a legacy (from the predecessor of the present trustee, acting under another will) which, pursuant to adjudication in the Orphans’ Court, was paid to the Anchorage and then turned over by it to the YMCA.

Appellants Wesley and Keswick maintain that: a) The Anchorage has abandoned the performance of the work which Mrs. Jacques sought to perpetuate, and has, therefore, lost its right to participate in the distribution of her testamentary gift, and b) Wesley and Keswick are entitled to divide between them the share of the trust estate allotted to the Anchorage. Even assuming, arguendo, the correctness of the first proposition, we find nothing in the law to sustain the second. The testamentary direction was that the proceeds of that part of the trust fund were to be given to the three institutions, “share and share alike”. There is no mystery surrounding the meaning of these words.

In Gilpin v. Hollingsworth, 3 Md. 190, 195 , we considered that phrase and said that “[i]n wills the expressions ‘equally to be divided,’ ‘share and share alike,’ ‘respectively between and amongst them,’ have been held to create a tenancy in common”; citing Blackstone’s comment that “an estate given to A. and B., equally to be di ¹⁹⁴ vided between them, ... is certainly a tenancy in common;”. II W. Blackstone, Commentaries, Chap. 12, p. ¹⁹³. See also Stein v. Stein, 79 Md. 464, 468 ; Preston v. Clabaugh, 90 Md. 707, 709 ; Horwitz v. Safe Deposit & Trust Co., 172 Md. 437 ; 39 Words & Phrases, “Share and Share Alike”. The majority rule throughout this country is that on the failure of a portion of a residuary trust, the portion so failing does not inure to the benefit of owners of the remaining portions.

Annot., 36 A.L.R.2d, 1117 . “When the disposition of an aliquot part of the residue itself fails from any cause, that part will not go in augmentation of the remaining part . . . but will devolve as undisposed of.” II Jarman, A Treatise on Wills, Chap. 23, p. 368 (5th Am. ed). This is the rule in Maryland, stated by this Court in Church Extension of the Methodist Episcopal Church v. Smith, 56 Md. 362, 399 , where we said: “It is equally well settled, that ‘where a portion of the residuary bequest fails to become operative at the death of the testator, in the manner provided, the portion thus failing, will not go to increase the other portions of the residuum, as a residue of a residue’. 2 Redfield on Wills, 119.” See also Curtis v. Maryland Baptist Union, Assn., 172 Md. 430 ; McElroy v. Mercantile-Safe Deposit & Trust Co., 229 Md. 276 (see also p. 291, Prescott, J., dissenting). Appellants Wesley and Keswick would have us read into the phrase “from and after”, as used by the testatrix, an intention on her part to establish a condition subsequent that the trust fund be divided among only those charities which were in existence at the time of the death of the last surviving life tenant. It is a well established rule of testamentary construction that in the absence of some clear manifestation of a contrary intent, or some contravening principle of law, estates will be treated as vesting at the earliest possible moment.

Wilson v. Pichon, 162 Md. 199 ; Grace v. Thompson, 169 Md. 653 ; Curtis v. Baptist Union, supra; Hans v. Safe Deposit & Trust Co., ¹⁹⁵ 178 Md. 52 ; Nicodemus National Bank v. Snyder, 178 Md. 140 . In Plitt v. Peppler, 167 Md. 252 , this Court held that where an estate in remainder was devised by name, its vesting should be referred to the time of the testatrix’ death, rather than the time appointed for the division of the estate, unless the will clearly indicates an intention that the remainder should not vest until the later period; and in Boulden v. Dean, 167 Md. 101 , we held that to make estates contingent, there must be plain expression to that effect, or such intent must be so plainly inferable from the terms used as to leave no room for construction. In doubtful cases the interest should be held to be vested, rather than contingent, unless the instrument under consideration will not admit of such construction. Miller, Construction of Wills, Sec. 227.

Even in those cases where, unlike the present case, there are apparent conditions or contingencies attached to a gift, we have held that in the absence of a clear reservation of a reversion, what might otherwise be construed as a condition will be regarded merely as the testator’s expression of confidence that the property will be used for the intended purpose, insofar as may be reasonable and practicable. Gray v. Harriet Lane Home, 192 Md. 257 ; Columbia Building Co. v. Cemetery, 155 Md. 221 ; Annapolis v. W. Anna. Fire & Imp. Co., 264 Md. 729 .

We have frequently considered the question of whether the words “from and after” are sufficient to create a contingent gift, or to indicate an intention to postpone vesting until the time appointed for the division of the estate, and we have held that they are not, unless there is some other expression of limitation or qualification set out or necessarily inferable from the will. In Williams v. Armiger, 129 Md. 222 , we said, at 233: “There are cases holding that words like the words ‘from and immediately after’ the death of the life tenant express the intention of the testator or grantor to defer the vesting of the re ¹⁹⁶ mainder until that period. Larmour v. Rich, 71 Md. 369 ; Poultney v. Tiffany, 112 Md. 630 . But here the words ‘from and after’ are followed by an express grant to the children Mrs. Johnson ‘now has’, which show that the grantor intended each of the children of Mrs. Johnson living at the time the deed was executed and delivered to take a vested remainder,”.

Similarly, in Cole v. Safe Deposit & Trust Co., 143 Md. 90 , we construed the words “from and after” to have only the effect of setting out the time of possession, receipt and enjoyment of a previously vested remainder. See also Tayloe v. Mosher, 29 Md. 443 ; Bailey v. Love, 67 Md. 592 ; Swift v. Cook, 133 Md. 651 . We hold, therefore, that the words “from and after”, as used in the Will at hand, do not express an intent to postpone or defer the time of vesting of the gift. The three institutions designated to divide the second part of the trust estate, Wesley, Keswick, and the