797 A.2d 746 (Md. 2002)
Dr. Jesse C. Coggins executed six wills with multiple codicils over his lifetime, beginning in January 1944.1 In every will he directed that the residue of his estate pass in trust with the corpus ultimately distributed to the Keswick Home, formerly Home for Incurables of Baltimore City, for construction of a new building to be known as the Coggins Building.2 Dr. Coggins and his wife maintained close ties to Keswick, including regular patient transfers from their Laurel Sanitarium and Mrs. Coggins's service on Keswick's Board of Directors; she later resided in an integrated Coggins Building.3
Dr. Coggins executed his final will on December 27, 1962, and died on January 21, 1963.4 Paragraph (f) of ITEM 5 directed that, upon termination of the trust, the assets be paid to Keswick "to house white patients who need physical rehabilitation," with the further provision that "[i]f not acceptable to the Keswick Home, then this bequest shall go to the University of Maryland Hospital to be used for physical rehabilitation."5 The racial limitation and alternative gift first appeared in this final will.6 The trust terminated on September 10, 1998, upon the death of Dr. Coggins's widow, the last surviving annuitant.7
By the time the trust terminated, Keswick had already constructed the Coggins Building in 1974.8 Keswick expended nearly $11 million in construction costs and capitalized repairs for the Coggins Building using its own funds, a bank loan, and a federal Hill Burton Act grant.9 Keswick had designated the building in honor of Dr. Coggins in 1969, dedicated it in 1975, and later made major renovations and additions while serving approximately 160 residents receiving physical rehabilitation services.10 Keswick had also presented plans for an additional $15.5 million in construction funded from the trust proceeds.11
In 1999 the trustee, Mercantile Safe Deposit & Trust Company, filed an interpleader action in the Circuit Court for Baltimore City pursuant to Maryland Rule 2-221.12 The court designated Keswick as plaintiff and University of Maryland Medical System Corporation (University Hospital) as defendant.13 Both parties moved for summary judgment on a stipulation of facts together with numerous documents, including the will, correspondence from 1963, board minutes, and trust memoranda.14
The Circuit Court for Baltimore City granted University Hospital's motion for summary judgment and ordered that the trust proceeds in the amount of $28,834,000 plus interest be paid to University Hospital.15 Keswick appealed, and the Court of Appeals of Maryland issued a writ of certiorari prior to any proceedings in the Court of Special Appeals.16
Whether the illegal racially discriminatory condition in Dr. Coggins's will should result in the bequest being awarded to the alternative beneficiary University Hospital?17
Under Maryland law, where a bequest is conditioned upon the commission of an illegal act, the condition is invalid on public policy grounds and will not be enforced by awarding the bequest to an alternative beneficiary; instead, the illegal condition is excised.18
No. The condition requiring the Coggins Building to house white patients is illegal under Maryland Code (1982, 2000 Repl. Vol.), § 19-355 of the Health General Article and related anti-discrimination provisions.19 The established facts show that Keswick constructed and has operated the Coggins Building since 1974 without the restriction and cannot comply with it.20 Yet the primary bequest remains fully acceptable to Keswick apart from the illegal term, as occurred in Fleishman v. Bregel when an illegal marital-status condition was excised rather than diverting the estate.21
The bequest should be awarded to Keswick with the racial restriction excised.22
Whether the presence of a gift over in the will precludes excising the illegal racial restriction from the primary charitable bequest to Keswick under Maryland law?23
The presence of a gift over to an alternative beneficiary does not preclude excising an illegal condition from a charitable bequest.24 Maryland cases treat the gift over as only one factor in assessing general charitable intent.25 They do not adopt an absolute rule barring excision when the condition violates strong public policy.26
No. The gift over to University Hospital appears in paragraph (f) of ITEM 5 of the December 27, 1962 will, but the established facts demonstrate Dr. Coggins's long-standing intent to benefit Keswick through multiple prior wills and the close family ties to the institution, including Mrs. Coggins's board service and residence in the integrated Coggins Building.27 This confirms general charitable intent, allowing excision consistent with Keyser v. Calvary Brethren Church and Miller v. Mercantile-Safe Deposit and Trust Co. rather than enforcing the illegal term.28
The presence of the gift over does not preclude excising the illegal racial restriction from the bequest to Keswick.29
Whether the Maryland Uniform Charitable Trusts Administration Act controls the disposition of a charitable bequest containing an illegal condition when the will was executed after the statute's enactment?30
The Maryland Uniform Charitable Trusts Administration Act, Estates and Trusts Article § 14-302, does not control or bar excision of an illegal condition in a charitable bequest; the statute's purpose is to save bequests that would otherwise fail, not to defeat bequests that would have been upheld under prior Maryland cases such as Fleishman v. Bregel.31
No. Dr. Coggins executed the final will on December 27, 1962 after the cy pres statute's enactment, yet the established facts show the racial condition first appeared only in that will and violates current public policy against race discrimination in hospitals.3233 The statute therefore does not mandate awarding the $28,834,000 trust proceeds to University Hospital; instead, the illegal condition is excised under the Fleishman and Keyser principles that remain fully applicable to post-statute charitable bequests.34
The Maryland Uniform Charitable Trusts Administration Act does not control to prevent excision of the illegal condition.35