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the method or manner in which their successors are to be chosen. When this is done, the method must be followed whenever it is at all possible. When this right has not been reserved, it is for the court to appoint the new trustees.

When a trust is created, and the trustee appointed resides in a foreign jurisdiction or country, in case of his death, disability, or refusal to act, the court will assume that the foreign. court having jurisdiction of the trustee will appoint a trustee to fill the vacancy.

Where an unincorporated club or association is appointed trustee, the trust will fail because there is no one capable of taking the legal title, and if the court wishes to see the trust carried out, it will have to appoint a trustee itself. Any trustee so appointed by the court, however, must not be one opposed in interest to the beneficiaries of the trust.

Trustees of charitable trusts will be held to the usual duties. and will be subject to the usual liabilities of trustees. They will be subject to any limitations or directions set forth in the will or other instrument creating the trust. Apart from this they will probably frame their own rules as to meetings and procedure. These will be supplemented by the usual parliamentary procedure applicable to all action by associated individuals.

§ 456. Trustees for Public Institutions

In every state and in every city there are many public institutions-libraries, hospitals, asylums, schools, and other social activities-the properties and businesses of which are managed and controlled by boards of trustees or managers with the functions of trustees. In such institutions the duties of trustees relate more to the conduct of the institution and the careful expending of its income than to the care of investments and the handling of trust property.

Such trustees are usually appointed, and they should

men of character and standing in the community. Those most affected by any negligence on the part of these trustees are not usually in a position to complain or to institute any attempt to remedy any wrongs. If the negligence is very excessive, some newspapers may stir up an investigation, otherwise nothing is usually done. A board of trustees of a public institution is apt to be much wedded to routine, and the superintendents and managers who do the actual work usually give reports of the work that are assumed to be correct, and the trustees generally take only such action as is indicated to them.

In some states savings banks are not organized for private profit, and boards of trustees are appointed to manage solely in the interest of the depositors. In such cases they are held to the strict liability of bank directors and are answerable for neglect and lack of business prudence.

§ 457. Educational Institutions

In charitable gifts to educational institutions, the gift is valid even though expressing no specific territorial limit; or the gift may be confined to a certain class or condition of persons, as for example, a gift for educational purposes limited to "Quaker children."

Where the territorial limit to be benefited is stated, but is not absolutely correct or exact as to boundaries, as where a gift is made to a "town" or a "vicinity," if the true meaning of the creator of the trust is apparent, the trust will be carried into effect according to the intention.

The trustees of educational institutions should be men of character, intellect, and culture. Their most important duty will be the selection of the educational head. After that their duty will be to help him carry his policy into effect. Of late years, boards of trustees have in some cases assumed the right to exercise a certain censorship over the teaching staff, and, it is charged, have brought unfair pressure against the expres

sion of opinions on the part of the professors. In some cases the duties of trustees are obscure, as where a man founded a college or endowed a chair to teach something in theology or economics in which he believed profoundly but which has since been discarded by the world of thought. It is then a question whether the trustees shall see that nothing is taught that the founder would have disliked, or whether they shall assume that if he were living he would prefer a more modern and more liberal interpretation of the old doctrines.

§ 458. Unincorporated Associations

A charitable gift to a trustee or trustees for an unincorporated society or club is perfectly valid, even though, as stated above, such an association cannot itself be a trustee. Such a gift will be valid even where the trustee or trustees appointed are the officers or trustees of the society or club which is to be benefited by the creation of the trust.

REVIEW QUESTIONS

1. What organizations and institutions are managed by boards of trustees or directors? What responsibility do these officers assume?

2. How are directors chosen in corporations? Who may vote at corporate elections?

3. How must such boards act? Can directors be removed? What is the usual authority of a board? What is the relation of the director of a corporation to the stockholders?

4. What are included under the term "charitable trust"? In your state, if a testator is indefinite or uncertain as to who is to be the beneficiary or the trustee, what will the courts do?

5. Does the rule against perpetuities apply to property left to a charitable trust?

6. May an unincorporated association act as trustee? What rules govern trustees of charitable trusts?

7. How are libraries, hospitals, and asylums managed? What are the duties of such governing boards? How are savings banks managed in your state?

8. What are the duties of trustees of educational institutions? What kind of men should they be?

9. May an unincorporated association in your state take a bequest of personalty or a devise of land? May a trustee be named in a will to take a devise for it? Who manages the affairs of an unincorporated association?

CHAPTER LIV

COMPENSATION OF TRUSTEE

§ 459. No Compensation to Trustee

In Great Britain, whence we derived our law of trusts, it is not usual to allow any trustee compensation. Over there, they have a legal maxim to the effect that a trustee may "make no profit out of his office." We have followed this rule so far as trustees and directors for charitable, educational, and public purposes, are concerned. It is not unreasonable to expect that capable men can be found who will give the time and care needed to manage the property and affairs of those institutions that exist not for profit but for the public good or to help the unfortunate.

It should be said that there are few capable business men in this country who do not give gratuitously time and ability to one or more institutions that yield them no profit or return. The rule that a trustee should "make no profit out of his office" properly applies to these, but in this country it is held not to apply to executives, guardians, and other trustees who handle private trusts, and are deemed entitled to compensation.

Trustees may have no compensation for their time and trouble, even when directed by a testator to carry on a business, unless the testator has made provision for such case in his will and has directed compensation. But, under a constructive trust, one who carries on another's business and is required to account for all profits, will be allowed compensation for necessary time or trouble expended by such a trustee in attending to the business.

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