Stevens v. Thames , 204 Ala. 487 ( 1920 )

The only point of difficulty of some apparent merit is that presented by the contention of appellee that the trustees of the Medical College consented to the dissolution of the corporation owning and controlling the franchises and physical property of the Medical College of Alabama, upon the condition expressed by the proviso in the act approved March 6, 1907, "that the said medical department shall remain at Mobile for all time"; that the transaction through which these rights were surrendered by the board of trustees of the Medical College of Alabama, and acquired by the state and vested In the board of trustees of the University of Alabama, constitute a contract, protected from impairment by both the state and federal Constitution. Const. Ala. 1901, § 22; Const. U.S. art. 1, § 10; Slaughter v. Mobile, 73 Ala. 134; State v. Cobb, 64 Ala. 127.

The facts pertinent to this question, in short, are: Section 8 of the legislative charter of the Medical College of Alabama provides:

"That 'The Medical College of Alabama,' hereby incorporated, shall constitute a department of the University of the State of Alabama, and upon the dissolution of said corporation from any cause whatever, all the property real or personal belonging to the corporation hereby created or held in trust for it shall inure to the benefit of and vest in the University of the State of Alabama." Acts 1859-60, p. 350.

By act approved March 4, 1907, the sum of $45,000 was appropriated out of the state's treasury "for the purpose of making needed improvements in the material equipment of the Medical College of Alabama, including the erection and furnishing of new buildings and the necessary repairs and furnishing of the buildings now [then] in existence," upon the conditions:

"That the money herein appropriated shall not be available, and the auditor shall not draw his warrant on the treasurer for said money, or any part thereof, until the title to all the property, real and personal, of every kind and description of said Medical College of Alabama shall have been vested in the board of trustees of the University of Alabama, and until the board of trustees of the University of Alabama shall have assumed full, complete and absolute management of and control over the said medical college of Alabama." Acts 1907, p. 340, §§ 1, 3.

On March 6, 1907, the act dissolving the corporation "styled the Medical College of Alabama" was approved, section one of which act reads as follows:

"Be it enacted by the Legislature of Alabama, that the corporation styled the Medical College of Alabama be and the same is hereby dissolved, and the institution heretofore known as the Medical College of Alabama is hereby declared and constituted the Medical Department of the University of Alabama and shall hereafter be under the sole management, ownership and control of the board of trustees of the University of Alabama: Provided that the said Medical Department shall remain at Mobile for all time." Acts 1907, p. 357, § 1.

This act was carried forward into the Code of 1907 as section 1889.

On April 5, 1907, the board of trustees of the University of Alabama passed a resolution, which, after reciting the passage of the acts hereinbefore mentioned, proceeded:

"Be it resolved that the board of trustees of the University of Alabama does now assume full, complete, and absolute management of and control over the Medical College of Alabama, and accepts title to all property, real and personal, of every kind and description of said Medical College of Alabama, in accordance with provisions of said act of 1907, and that act of the Legislature of Alabama entitled 'An act to provide necessary funds for maintenance, repairs, improvements, apparatus and additions to the Medical College of Alabama,' approved March 4, 1907."

Subsequent to the passage of this resolution, to satisfy a doubt expressed "by some of the state officers charged with the disbursement" of the appropriation made by the act of March 4, 1907, the board of trustees of the Medical College executed and delivered to the board of trustees of the University of Alabama a deed conveying all the property, both real and personal, of the Medical College of Alabama; the consideration and purposes for such conveyance being thus set forth in the deed:

"Whereas, the act approved January 30, 1860, incorporating the Medical College of Alabama, provides, among other things, that upon the dissolution of said corporation from any cause whatever all of the property real or personal belonging to said corporation or held in trust for it shall inure to the benefit of and vest in the University of Alabama, and Whereas, this board heretofore determined that it would be to the interest of the institution of learning for many years conducted by said corporation known as the Medical College of Alabama to have the same become a part of the University of Alabama, and to that end took steps which resulted in the passage of an act, approved March 4, 1907, making an appropriation of $45,000 for the use of said institution, and also an act approved March 6, 1907, dissolving the corporation styled the Medical College of Alabama, and the individuals composing this board, being advised that they had no further functions or duties to perform as such trustees, resigned as such trustees; and whereas, the appropriation made by the above-mentioned act approved March 4, 1907, by virtue of section 3 thereof, is not available until the title to all the property, real and personal, of every kind and description, of said Medical College of Alabama, shall have been vested in the board of trustees of the University of Alabama, and this board is now advised that, notwithstanding the legislative acts and other proceedings above recited doubt has been expressed by some of the state officers charged with the disbursement of such appropriation as to whether or not the title to the property of said Medical College of Alabama has vested in the University of Alabama or its trustees, and that the said officers are of the opinion that a conveyance by the Medical College of Alabama of all of its property to the University of Alabama will satisfy such doubt and question," etc.

The Medical College of Alabama, at the time of the transaction here shown, was an existing educational institution, owned and controlled by an independent corporation. It was not a civil institution of the government of this state, endowed with governmental functions to be administered for internal governmental purposes, in respect to which the Legislature of the state may deal according to its own judgement, unrestrained by constitutional limitation. For this reason the holding in Newton v. Com'rs., 100 U.S. 548,25 L. Ed. 710, and authorities of like import cited by appellant, are not apt.

It was a private eleemosynary corporation, with authority to acquire and own property for its uses, and over it the state had no control. State ex rel. Medical College of Alabama v. Sowell, supra. The manifest purpose of the transaction here involved was to effect a surrender by the corporation of its franchises and property on the condition expressed in the act of March 6, 1907, "that the said Medical Department shall remain at Mobile for all time," and this condition is not made a matter of implication or construction, but is a provision clearly and unmistakably expressed in the act of the Legislature designed to accomplish the transfer of these rights. Dartmouth College v. Woodward, 4 Wheat. 518-640,4 L. Ed. 629; State ex rel. Medical College of Ala. v. Sowell,143 Ala. 494, 39 So. 246; Pearsall v. Gr. North. R. R. Co.,161 U.S. 661, 16 Sup. Ct. 705, 40 L. Ed. 838; State v. Ala. Bible Soc., 134 Ala. 632, 32 So. 1011; Mayor v. Ins. Co., 53 Ala. 570; Hare v. Kennerly, 83 Ala. 608, 3 So. 683.

As said by the Supreme Court of the United States:

"Undoubtedly there are cases in which a state may, as it were, lay aside its sovereignty and contract like an individual, and be bound accordingly." Newton v. Com'rs, supra; Curran v. State of Ark., 15 How. 304, 14 L. Ed. 705; Davis v. Gray, 16 Wall. 203, 21 L. Ed. 447; Ala. Co. v. Burkett, 46 Ala. 569.

Therefore, if the Legislature of the state, on the one hand, and the Medical College of Alabama, on the other, had the power and authority to impose this condition in the transfer of the property to the trustees of the University, it constitutes a binding obligation that may be recognized and protected through the courts in so far as the contract is protected by the Constitution. Dartmouth College v. Woodward, supra; State ex rel. Medical College v. Sowell, supra; Pearsall v. Gr. North. R. R. Co., supra; State v. Ala. Bible Soc., supra; Mayor v. Ins. Co., supra; Hare v. Kennerly, supra. Viewed as a contract, the provision in the act of March 6, 1907, relates to future maintenance of the college at Mobile, involving matters of legislative authority and policy in the use of the state's public funds, and over which the courts can exercise no control. It was not a condition precedent to the vesting of the title in the University of Alabama. That title vested by virtue of the act of 1860, upon the dissolution of the corporation known as the Medical College of Alabama. Section 3 of the charter provides that —

"It [the Medical College of Alabama] is also empowered at any time and in any manner, to acquire and hold or dispose of all such real and personal estate as it may deem necessary for the purposes of said college. All such property and the proceeds thereof, shall be held solely and exclusively in trust, for the use and benefit of said college, and all property of said college, shall be, and the same is hereby made free and exempt from taxation."

Section 8 of the charter provides:

"The Medical College of Alabama hereby incorporated shall constitute a department of the University of the State of Alabama, and upon the dissolution of said corporation from any cause whatever, all the property, real and personal, belonging to the corporation hereby created, or held in trust for it, shall inure to the benefit of and vest in the University of the State of Alabama."

In the act of incorporation $50,000 was —

"appropriated out of any money in the treasury, not otherwise appropriated, * * * to be applied to the purchase of a suitable lot or lots, and the erection of such buildings as a, majority of the trustees for the time being, and their successors, may deem necessary and proper for the purpose of said college."

It is impossible to read these provisions of the act, and not be driven to the conclusion that the state had an interest in any and all property acquired by the Medical College of Alabama, inchoate, of course, but subject to become absolute upon the dissolution of the corporation created by the act, for any cause whatsoever, and upon the happening of this event the title passed to and vested in the University of Alabama. Under the terms of this charter contract, as long as the corporation existed and functioned as an educational agency, it owned and controlled the property, with the right to dispose of it for the use of the college, but upon the death of the corporation its entire interest ceased, and the property became the property of the state by the terms of the contract, and this contract could not be impaired or changed by any subsequent act of the Legislature.

The deed executed by the Medical College of Alabama, through its president and secretary, and signed by its trustees, shows that the acts of the Legislature of March 4th and March 6th were passed by the procurement and consent of the trustees of the Medical College, and the sole legal effect of the act of March 6, 1907, was to accomplish the dissolution and destruction of the corporation known as the "Medical College of Alabama," and eo instante the title to all property owned by it passed to and vested in the University, unincumbered by any condition on that title, and hence passed under the control and management of the board of trustees of the University by virtue of this act of 1907.

Section 267 of the Constitution provides that —

"The Legislature shall not have power to change the location of the State University, or the Alabama Polytechnic Institute, or the Alabama Schools for the Deaf and Blind, or the Alabama Girls' Industrial School, as now established by law, except upon a vote of two-thirds of the Legislature taken by yeas and nays and entered upon the journals."

This section clearly is not dealing with the power of control vested in the trustees of the University by section 264, and, when the two sections are considered together, it is manifest that the power of management and control vested in the trustees by section 264 does not include the power of removal — a power, in the absence of constitutional restraint, residing in the Legislature. It is not a matter of doubt, however, that the term "the State University" is used in the same sense in the two sections, and that it relates to the institution of learning located at Tuscaloosa, in the Sixth congressional district, and that the limitations placed on the Legislature by section 267 do not apply to the Medical College at Mobile. It therefore follows that the act of February 18, 1915, does not impinge either of these sections of the Constitution.

Section 21, art. 31, of the act approved, September 26, 1919, provides:

"The corporation styled the Medical College of Alabama is dissolved and the institution known as the Medical College of Alabama is constituted the Medical Department of the University of Alabama, and shall hereafter be under the sole ownership, management and control of the board of trustees of the University of Alabama," etc. Acts 1919, p. 659.

Said section is a clear revision of the whole subject-matter embodied in the act of February 18, 1915, and operated to repeal the act of 1915, vesting in the board of trustees a discretion in dealing with the Medical Department at Mobile, unrestrained by legislative mandate. Lemay v. Walker, 62 Ala. 39; Powell v. State ex rel. Hasty, 142 Ala. 80, 39 So. 164.

The averments of the bill show that the defendants are proceeding under the supposed mandatory provisions of the acts of 1915 to remove the Medical Department from Mobile, and whether they will further proceed on being advised that they are not required by the acts of 1915 to so proceed, we are not advised. The restraint on their discretion, afforded by the act of 1915, being removed, the moral obligation arising from this transaction, and the question of protecting the state's honor, would no doubt appeal to them in their future actions in respect to the removal of the Medical Department. However, their acts are not unlawful, and cannot be restrained through the courts.

For these reasons I concur in the conclusion that the bill is without equity.