PAM. 
 
 MISC. 
 
 / 
 
 
 APR 11 W95 *j 
 
 a -: w v 
 
 THE 
 
 NEW MISSION BUILDING 
 
 OR THE 
 
 BOARDS OF 
 
 HOME and FOREIGN MISSIONS 
 
 OF THE 
 
 PRESBYTERIAN CM UIRCM 
 
 IN THE 
 
 UNITED STATES of AMERICA. 
 
 The Investment and Security of Trust Funds. The Legacies of Mrs. 
 R. L. Stuart. The Policy of the Church as to 
 
 X 
 
 Its Boards and Buildings. 
 
 By THOS. McDOUGALL 
 
 CINCINNATI : 
 
 Elm Street Printing Company. 
 1895. 
 
EXPLANATORY. 
 
 The purchase ot real estate on the corner of Twentieth street and 
 Fifth avenue, New York City, and the erection of a large structure 
 thereon by the Boards of Home and Foreign Missions, at a cost of one 
 million, seven hundred and fifty thousand dollars, involve many important 
 questions of policy, the use of trust funds, and the extent of the powers 
 of those Boards, worthy of the consideration of the membership of the 
 Church. 
 
 This pamphlet is published and circulated by the writer for the cole 
 purpose of enabling the membership of the Church to give to the ques¬ 
 tions raised by this investment, that 'careful and thorough consideration 
 which will enable the Church to determine its future policy in regard to 
 the disposition of trust funds, and the administration of the affairs of its 
 several Boards. 
 
 Cincinnati, O., Mar. 12th, 1895. 
 
To the Members of the Presbyterian Church 
 
 in the U. S. A. 
 
 Dear Brethren :—According to 
 the reports made to the last Gen¬ 
 eral Assembly, at Saratoga, the 
 Boards of Home and Foreign Mis¬ 
 sions closed their fiscal year May 
 i, 1894, with an aggregate indebted¬ 
 ness of $361,243.34, divided as fol¬ 
 lows : Home Missions, $258,645-55; 
 Foreign Missions, $102,597.79. The 
 Church is to be congratulated that in 
 a time of unparalleled financial de¬ 
 pression, during the fiscal year end¬ 
 ing May 1, 1894, the contributions 
 for these two Boards reached the sum 
 of $1,746,101.76. The cause of 
 Christ, as represented in the Home 
 and Foreign Mission work of the 
 Presbyterian Church, demands the 
 generous support of every mem¬ 
 ber of the Church, in order that the 
 demands of the fields may be met 
 with an adequate supply of men and 
 money. Whatever differences of 
 opinion may exist among our people 
 should not, for one moment, interfere 
 with the progress of the work, nor 
 with the financial support which is 
 necessary to carry on the operations 
 of the two Boards. 
 
 The members of the Boards, the 
 secretaries and other officials have no 
 interest in the service other than their 
 desire to see the Kingdom prosper. 
 To the best oftheir ability, and at 
 
 great personal sacrifice to many of 
 them, they seek the welfare of the 
 Church with a fidelity and service that 
 merit the commendation of all. 
 
 It is to be deeply regretted that so 
 much indebtedness existed at the 
 beginning of this fiscal year. In order 
 to its payment, and to the raising of 
 the funds necessary for the work of 
 the Boards, contributions must be 
 increased over those of last year. 
 
 THE NEW MISSION HOME. 
 
 One of the subjects which occupied 
 the attention of the last General As¬ 
 sembly was the erection of a new 
 mission home on the site purchased 
 in 1893 by the two Boards on Twen¬ 
 tieth street and Fifth avenue. 
 
 The dimensions of this lot are 92 
 feet on Fifth avenue, and 198 feet on 
 Twentieth street, it having been pur¬ 
 chased from the estate of Mrs. R. L. 
 Stuart, April 15, 1893, °f which es¬ 
 tate Messrs. George C. Williams and 
 John S. Kennedy are executors. The 
 price paid for the lot was $670,000, 
 and was paid as follows: 
 
 From Legacy of Mrs. R. L. Stuart - $315,000.00* 
 Gift from Mr. John S. Kennedy - 15,000.00. 
 
 Loan, on the property, at int’st 340,000.00. 
 
 THE PRESENT MISSION HOME. 
 
 The premises now occupied by 
 these two Boards on Fifth avenue and 
 Twelfth street, eight blocks distant 
 
— 4 — 
 
 from the new site, front 131 feet on 
 Fifth avenue, 103 feet of which is 150 
 feet deep on Twelfth street, and the 
 remaining 28 feet is 103 feet deep. 
 This site is larger in area than the 
 new one on Twentieth street and 
 Fifth avenue. The rear part of the 
 present premises, fronting about sixty 
 feet on Twelfth street, is vacant. 
 
 On the new site, a building not less 
 than ten stories in height is in course 
 of erection, at a cost of not less than 
 one million dollars ($1,000,000); so 
 that when the building is completed, 
 the site and building will represent an 
 investment of at least one million, 
 seven hundred and fifty thousand 
 dollars ($1,750,000). 
 
 HISTORICAL. 
 
 The site now occupied by the two 
 Boards, at the corner of Twelfth 
 street and Fifth avenue, was acquired 
 sometime in the year 1887. With 
 reference to the acquisition of that 
 site, and how it was paid for, we find 
 in the Minutes of the Assembly for 
 1888, page 21, the following, from the 
 report of the Board of Home Missions 
 to the General Assembly: 
 
 “This year has been made especially mem¬ 
 orable by the Boards’ acquisition and occu¬ 
 pation of a home of their own. A long tried 
 and generous friend of both Boards, the late 
 Mr. R. L. Kennedy, had for years had his 
 eye on these premises as being, in view of 
 the site, the accommodations and associa¬ 
 tions of an honored Presbyterian name, 
 singularly well suited for a Presbyterian 
 House. Accordingly, at his instance, the 
 heirs of the Lenox estate offered this prop¬ 
 erty to the two Boards for $250,000, a price 
 judged by experts so low as to involve a 
 virtual gift of a large amount towards the 
 purchase by the heirs themselves. Miss H. 
 A. Lenox, to whose estate this property 
 belonged, had bequeathed to the Home and 
 Foreign Boards each $50,000. Mr. Ken¬ 
 nedy, besides arranging these most favor¬ 
 
 able terms, gave $50,000 towards the pur 
 chase money,and added $20,000 for the 
 necessary alterations and repairs. Thus 
 two-thirds or three-fourths of the means for 
 this purchase came from members of th*e 
 family connection owning the property.” 
 
 And from the report of the Board 
 of Foreign Missions, the same 
 Minutes, page 79, the following: 
 
 “We congratulate the Board upon its 
 entrance into the new quarters, 53 Fifth Ave. 
 To Mr. Robert Lenox Kennedy’s wise fore¬ 
 thought and princely munificence the 
 change is largely due. The Mission House, 
 123 Center St. has grown historic, and was 
 hallowed by precious memories, but who 
 shall forecast the record of this latter house? 
 What if its unfolding history should bring 
 to the waiting eyes of the Church the glories 
 of millennial morning?” 
 
 The General Assembly of the same 
 year, as appears on page 67, of its 
 minutes, adopted the following reso¬ 
 lution : 
 
 “Resolved, that this Assembly hereby ex¬ 
 presses its grateful appreciation of the Chris¬ 
 tian generosity of the heirs of the Lenox 
 estate, and of Mr. Robert Lenox Kennedy, 
 for their munificent aid in securing a house 
 so suitable as a center of our denominational 
 work, and devoutly trusts that this building 
 may stand the next century through as a 
 monument to the wise and loving liberality 
 of those who gave it.” 
 
 THE OLD AND THE NEW. 
 
 The present premises, the historic 
 Lenox homestead, which were pur¬ 
 chased in 1887, less than eight years 
 ago, are to be sold, and the proceeds 
 of the sale invested in this new site 
 and structure, only eight blocks dis¬ 
 tant on the same street. The present 
 home is without debt or incumbrance, 
 and the ground is of ample area for 
 the buildings necessary for the work 
 of the Church for centuries. These 
 premises, thus acquired from the 
 Lenox estate, as we have stated, are 
 to be sold, and the proceeds of the 
 sale invested in the new site and 
 
— 5 — 
 
 structure, on which there now rests a 
 
 • 
 
 first mortgage for one million of dol¬ 
 lars, as hereinafter stated. The 
 money given by Mrs. Henrietta Lenox, 
 and Mr. Robert Lenox Kennedy, 
 and the Lenox heirs, for the purchase 
 of the property, was a permanent 
 gift to the Church. That money, on 
 the sale of these historic premises, is 
 to be invested in a site and building, 
 mortgaged as we have stated, thus 
 not only selling the property bought 
 as a permanent mission home for the 
 Church, but investing the proceeds in 
 a second mortgage—a mortgage on 
 the equity of redemption of the mort¬ 
 gagors—whose security rests on the 
 constant maintenance of sufficient fire 
 insurance policies in responsible com¬ 
 panies, and which will be respon¬ 
 sible in the event of the destruc¬ 
 tion of the building. The site 
 on which the new building is being 
 erected was purchased by the two 
 Boards, April 15, 1893, for the sum 
 of $670,000, and the purchase com¬ 
 pleted before any action was taken on 
 the subject by the General As- 
 semblv. 
 
 4/ 
 
 The site thus purchased at such an 
 enormous cost, was purchased when 
 the Boards had not received any 
 money especially given for that pur¬ 
 pose, except the $15,000 given 
 by Mr. John S. Kennedy; and the 
 erection of a building thereon at a 
 cost of over a million of dollars, in 
 addition to the cost of the site, is 
 being proceeded with when the Boards 
 are in debt hundreds of thousands of 
 dollars for current work, and are in 
 debt $340,000.00 for the site, and 
 have not received any gifts so far 
 
 as we know, for such a building. One 
 million dollars has recently been bor¬ 
 rowed by the Board from the Sea¬ 
 men’s Bank for Savings, for the new 
 enterprise, the site and building being 
 mortgaged to secure the money thus 
 borrowed. 
 
 CREDIT ; NOT FUNDS. 
 
 In other words, the Boards of Home 
 and Foreign Missions, being mere 
 agencies of the Church for the ad¬ 
 ministration of certain specific mission 
 work, and the distribution of her 
 funds contributed for that purpose, 
 and being in possession of premises 
 owned in fee simple, and unencum¬ 
 bered by debt, and having vacant 
 ground sufficient to erect any needed 
 buildings for the work of the Boards, 
 and having no money given them for 
 a new building, go into the real estate 
 market and mainly on credit buy a plot 
 of ground on the same street, at a cost 
 of $670,000, and proceed to erect 
 thereon a building at a cost of over a 
 million of dollars in addition. The 
 Church has never known in her ex¬ 
 perience, such a gigantic real estate 
 investment, and that very largely on 
 borrowed money. And this invest¬ 
 ment has been made to provide the 
 necessary room for the scretaries 
 and their clerks, in the work of dis¬ 
 tributing the funds contributed by the 
 Church, and carrying on the Church’s 
 work of Home and Foreign Missions. 
 
 According to the statement issued 
 by the two Boards, the reasons given 
 for the purchase of the new site, the 
 erection of the new building, and the 
 sale of the historic Lenox homestead, 
 are as follows : 
 
THE REASONS AS GIVEN BY THE 
 BOARDS. 
 
 “THE NEW PRESBYTERIAN BUILDING. The 
 Boards of Home and Foreign Missions are 
 about to erect on the property purchased in 
 1893, on th e corner of Twentieth street and 
 Fifth avenue, a large building for their own 
 needs, with additional office accommoda¬ 
 tions which will be rented to suitable ten¬ 
 ants. 
 
 This project represents the result of a 
 careful business consideration of the whole 
 problem of office accommodation. Although 
 planned on a large scale it has been con¬ 
 sidered in every detail, with a view to prac¬ 
 tical economy. 
 
 Many years ago friends of the Board of 
 Foreign Missions secured a building at 23 
 Center street, which gave more than ampla 
 accommodations for its work, and some por¬ 
 tions were rented for secular business. The 
 building was largely the gift of a few friends, 
 among whom was the late James Lenox, 
 and it was confidently believed that the 
 structure would constitute a lasting monu¬ 
 ment to their liberality. With the Reunion 
 of the Presbyterian Church in 1870, the 
 three great Boards of the Church in New 
 York were placed together in this building, 
 but it became necessary for the Board of 
 Home Missions to rent other quarters, and 
 the two growing organizations for women’s 
 work in Missions were obliged to find ac¬ 
 commodations elsewhere. Many projects for 
 securing a larger Mission House were from 
 time to time discussed, but for some years 
 no suitable place was found. 
 
 But early in 1888, through the efforts and 
 generosity of the late Robert Lenox Ken¬ 
 nedy, the Boards moved to the present 
 building at 53 Fifth avenue, the late home 
 of Mr. James Lenox and his two sisters, 
 whose large gifts to the Boards for many 
 years are still remembered. The heirs of 
 Mrs. Henrietta Lenox, who survived her 
 brother, generously sold this property to the 
 Boards for $250,000, a price less than its 
 actual value. It was paid for by a gift of 
 $50,000, from Mr. Robert Lenox Kennedy, 
 Miss Henrietta Lenox’s legacy of $50,000, 
 to the Home Board, $70,000, proceeds of 
 the sale of the Center street property by the 
 Foreign Board, and the balance, $80,000, 
 from the permanent funds of the two Boards. 
 As in the case of the former building, it 
 was hoped that this would provide commo¬ 
 dious quarters for the Boards for many years 
 to come, but the growth of the work has 
 been so great and so rapid that another 
 change has become imperative. 
 
 The need of more room for the three 
 Boards of the Church and the two great de¬ 
 
 partments of Women’s Work occupying the 
 the present building, also for the various 
 Missionary gatherings which center there, 
 is already urgent. The house having been 
 built as a private dwelling, or rather two 
 dwellings (now separated by what is known 
 as Lenox Hall), is ill-adapted for office use. 
 In many rooms there is positive discomfort, 
 with a necessary lack of highest efficiency. 
 The question of alteration has arisen from 
 time to time, but the present building is so 
 constructed as not to admit of change on 
 any wise and comprehensive plan. Mean¬ 
 while, the structure does not admit of busi¬ 
 ness rentals as a source of income. The un¬ 
 occupied ground is entirely unremunerative, 
 and the plot as a whole can only be econom¬ 
 ically utilized by the removal of the present 
 structure and the erection of entirely new 
 buildings. 
 
 This step is therefore in the interest of 
 wise economy. In a city where prop¬ 
 erty commands the high prices which rule 
 in New York, it is waste to occupy so much 
 land as these Boards own, without utilizing 
 its possibilities for a large income from rent¬ 
 als. The Bible and Tract Socities and the 
 Methodist Episcopal Church have for years 
 acted upon this principle. The Tract Soci¬ 
 ety is about to utilize its valuable property 
 with a new office building. In the present 
 quarters, with so much unavailable space in¬ 
 side and outside the building, and taking 
 into view the value of land in this part of 
 the city, the Boards are living at an extrav¬ 
 agant rental which cannot be justified on 
 sound business principles. Alterations in 
 the present property would merely increase 
 present expenses with no adequate return - 
 compared with the amount expended. Te> 
 remove the present structure and build on 
 the present site would involve great incon¬ 
 venience and expense for at least two years. 
 
 When this question was pending, the 
 death of Mrs. Robert Stuart brought to the 
 Boards legacies of over $500,000. It was 
 definitely known that Mrs. Stuart had ex¬ 
 pressed a desire that a large part of her gift 
 should be retained as a permanent invest¬ 
 ment, and was only deterred from fixing the 
 amount by the advice of her executor. Of 
 her legacies the Boards used $125,000 in cur¬ 
 rent work, and the remainder has been 
 availed of in part payment for the property 
 corner Twentieth street and Fifth avenue. 
 
 In selecting this location rather than re¬ 
 building on the present site, the Boards 
 acted through special committees, and after 
 consultation with the best real estate ex¬ 
 perts of the city, who pronounced the prop¬ 
 erty at Twentieth street and Fifth avenue 
 of exceptional value for rental purposes. 
 
and likely to produce larger revenue for 
 many years than the property corner of 
 Twelfth street. A special committee of 
 both Boards, with Mr. John S. Kennedy as 
 Chairman, has in charge the development 
 of the details. On its financial side this move¬ 
 ment rests upon the united judgment of 
 sagacious business men to whom the Boards 
 and the Church have intrusted the manage¬ 
 ment of permanently invested funds. It is 
 wholly distinct from the management of 
 current outlay for missionary work. No 
 part of the moneys contributed for the mis¬ 
 sionary work of the Boards will be diverted 
 for use in connection with this project. The 
 necessary funds will be provided from the 
 legacies of Mrs. Stuart, from funds of the 
 Boards which must be permanently in¬ 
 vested, and from the proceeds of the 
 sale of the present property at Twelfth 
 street and Fifth avenue ; any balance above 
 these amounts which may be needed will 
 be secured by a mortgage on the property 
 upon which the building is to be erected. 
 The rentals will provide the necessary 
 interest and a sinking fund to extinguish 
 the principal of the mortgage, and in time 
 return a revenue which will help t© meet 
 the expense of administration. 
 
 HOW THE BOARDS ACTED. 
 
 The date of the conveyance of the 
 new site to the two Boards is April 15, 
 1893. The property having thus been 
 purchased, on March 27th, 1894, ac¬ 
 cording to the statement prepared by 
 the Boards, resolutions were adopted 
 by the Board of Home Missions as 
 follows: 
 
 Resolved, That the Building Cemmittee 
 of the Board be, and it hereby is author¬ 
 ized and directed to proceed jointly with 
 the Board of Foreign Missions, or other¬ 
 wise, as it thinks best, with the erection of 
 a building on the Stuart property, at the 
 northwest corner of Fifth avenue and Twen¬ 
 tieth street, belonging to the two Boards; 
 and for the purpose to employ an architect, 
 or architects, enter into contracts, and do 
 everything necessary for the complete con¬ 
 struction and fitting up of the building ; and 
 to make all arrangements for obtaining the 
 necessary money, including borrowing, 
 either upon credit of the board or upon 
 mortgage, or in any other way; and 
 
 Resolved, further, That at any time, 
 upon the direction of the building com¬ 
 mittee, the proper officers of the Board 
 
 sign and execute all necessary papers to 
 carry out the purpose of the foregoing reso¬ 
 lution, including notes, bonds and mort¬ 
 gages ’and other obligations, and to affix 
 thereto the seal of the board. 
 
 As we have already stated, the total 
 indebtedness of the Boards of Home 
 and Foreign Missions, existing on the 
 1 st day of May, 1894, for the current 
 work of the Boards, was over three 
 hundred and sixty thousand dollars. 
 In addition to this sum the Boards 
 were then indebted on account of the 
 purchase price of the new site on 20th 
 Street and Fifth avenue, to the amount 
 of three hundred and forty thousand 
 dollars, making a total indebtedness, 
 May 1 st, 1894, for current work, and 
 the unpaid purchase price of the new 
 site, of over seven hundred thousand 
 dollars. Since that day the Boards 
 have borrowed one million dollars 
 from the Seamen’s Bank for Savings, 
 and given a mortgage on the new site 
 for that amount to secure the loan, 
 which mortgage bears date the 30th 
 day of November, 1894. 
 
 TRUST FUNDS AND THEIR USE. 
 
 It is to be noted here that in addi¬ 
 tion to this indebtedness, the Boards 
 had expended three hundred and 
 fifteen thousand dollars of the legacies 
 of Mrs. Stuart in part payment for the 
 site. This money was invested in the 
 site April 15th, 1893, while the Boards 
 have been paying interest on their 
 debts for current work, and as we 
 shall see hereafter, the whole amount 
 of the legacies of Mrs. Stuart were 
 available for current work, the Boards 
 having actually used one hundred and 
 twenty-five thousand dollars of the 
 legacies for that purpose. 
 
 Every dollar of the hundreds of thous- 
 
— 8 
 
 ands given by Mrs. Stuari was available 
 for the payment of the salaries of home 
 and foreign missionaries , and could have 
 been used for that purpose at any time 
 since it came into the possession of the 
 Boards , and could have been- used for 
 the liquidation of the current indebted¬ 
 ness of the Boards. The total amount 
 of the legacies of Mrs. Stuart which 
 could have been applied to the pay¬ 
 ment of the salaries of Home and 
 Foreign Missionaries, other than the 
 $125,000 so used, is four hundred 
 and seventy-five thousand dollars, 
 and that amount has been or will be 
 permanently invested in this site and 
 building. The payment of the sala¬ 
 ries of the Home and Foreign Mis¬ 
 sionaries is the first and highest duty 
 of the Church, and all funds given or 
 available for such purpose, should be 
 sacredly guarded and used to that 
 end. 
 
 POLICY OF THE CHURCH. 
 
 This investment on the part of the 
 two Boards, and the policy which dic¬ 
 tates and controls it, raise a number 
 of important questions which the mem¬ 
 bership of our Church ought to con¬ 
 sider. God has given large wealth to 
 some of the members of our Church. 
 The owners or stewards of large 
 wealth, more than ever recognize the 
 necessity of using it along lines of 
 Christian work, and this is pre-emi¬ 
 nently an age of liberal endowment of 
 enterprises which commend them¬ 
 selves to Christian people in order to 
 advance the work of the Church, and 
 to build up the Kingdom of Jesus 
 Christ on Earth. 
 
 Our Church is face to face with the 
 important question of the formation of 
 
 a policy touching the endowments of 
 her various agencies or boards, which 
 not only merits careful and prayerful 
 attention, but which will tax the high¬ 
 est order of ability in its solution. 
 Such a policy must be adopted and 
 adhered to as will command the full 
 confidence of those who have wealth 
 to commit to the keeping and use of 
 the various agencies of our Church. 
 That policy must insure the perma¬ 
 nent application of the gifts to the 
 purposes for which they were given. 
 
 It is designed to call attention to the 
 transactions described above by which 
 these two Boards have committed the 
 Church to the investment of one and 
 three quarter millions of dollars in 
 providing a home for her mission 
 work, and incurring in so doing a 
 mortgage debt of one million dollars, 
 for the purpose of raising the 
 questions already referred to, which 
 can only be solved by that calm con¬ 
 sideration which should be present in 
 a friendly discussion by members of 
 the Church of Christ. Let us proceed 
 to examine. 
 
 1. To what extent have the 
 Boards of Home and Foreign Missions 
 the power to purchase real estate ? 
 
 2. What power do they possess 
 to invest in real estate funds given for 
 the purposes of the Boards ? 
 
 3. What should be the policy of 
 the Church in making provision for 
 the premises necessary to carry on the 
 work of her respective agencies? 
 
 1. 
 
 TO WHAT EXTENT HAVE THE BOARDS 
 
 OF HOME AND FOREIGN MISSIONS THE 
 
 POWER TO PURCHASE REAL ESTATE ? 
 
 The Boards of Home and Foreign 
 
— 9 — 
 
 Missions are civil corporations created 
 by the laws of New York. Like all 
 corporations their powers are limited 
 by the laws of the State creating them. 
 They cannot exercise any other 
 powers than are expressly granted to 
 them, or are necessary to carry out 
 the purposes for which they are 
 created. According to the law of the 
 State of New York, such corporations 
 as the Boards of Home and Foreign 
 Missions have authority to acquire 
 such real estate as is necessary for the 
 purpose of incorporation. 
 
 At the time that these two Boards 
 purchased the site on 20th street and 
 Fifth avenue, they were the owners 
 and holders of the present Mission 
 premises on the corner of Fifth ave- 
 enue and 12th street. It can not be 
 denied that the present site on Fifth 
 avenue and 12th street is amply suf¬ 
 ficient for the purposes for which they 
 are incorporated, and had ample area 
 for all the buildings necessary to carry 
 on the business of the two Boards for 
 the next two hundred years. 
 
 The moving cause for the acquisi¬ 
 tion of the new site was not that the 
 present premises are not large enough 
 for the business of the two Boards, but 
 rather, as stated in the circular of the 
 Boards, “ that a new structure erected 
 on the present site would not admit 
 of office rentals as a source of income; 
 and that in a city where property com¬ 
 mands the high prices that rule in 
 New York, it is a waste to occupy so 
 much land as these Boards own with¬ 
 out utilizing its possibilities for a large 
 income for rentals. ” In other words, 
 the site at Fifth avenue and 20th 
 street would be a better site for rent¬ 
 
 ing the unoccupied portions of such a 
 structure as the Boards desire to 
 erect, than the site at Fifth avenue 
 and 12th street; and it would be 
 a better investment of money to locate 
 on a site where large rentals can be 
 obtained from stores and offices, for 
 so much of the building as the Boards 
 do not use for their own purposes. 
 
 WHY THE BOARDS WERE INCORPO¬ 
 RATED. 
 
 It is to be borne in mind, however, 
 that these Boards were not incorpo¬ 
 rated for the purpose of erecting build¬ 
 ings to be rented as stores and offices. 
 Neither were they incorporated to 
 speculate in real estate, and to take 
 the risks incident to all such invest¬ 
 ments in large cities. The question 
 arises whether such corporations, hav¬ 
 ing acquired and holding sufficient 
 property for their own uses, have 
 power under the law of the state in¬ 
 corporating them, while they still hold 
 that property, to invest or speculate 
 in other property on which to erect 
 buildings, which they propose to rent 
 for other uses than their own. If 
 they have, where is the limit ? How 
 many buildings may they thus acquire 
 even without money and solely on 
 credit? 
 
 Of course the only authority that 
 could legally question the exercise of 
 
 that power is the State of New York 
 
 * 
 
 that created the corporations. But 
 whether civil cprporations created 
 solely for the purposes for which our 
 Boards of Home and Foreign Mis¬ 
 sions were incorporated, should en¬ 
 gage in any such investments and 
 speculations, even if they have the 
 charter power to do so, is a wholly 
 
IO — 
 
 different question. We presume that 
 these Boards before acting were ad¬ 
 vised that they possessed the legal 
 • authority under the laws of the State 
 incorporating them, to hold and 
 acquire the property on the corner of 
 20th street and Fifth avenue, where 
 they are erecting a million dollar 
 building with borrowed money, the 
 larger portion of which will be occu¬ 
 pied, not by themselves, but be rented 
 for stores and offices, just as any other 
 investment in real estate and build¬ 
 ings, while at the same time they were 
 the owners of other real estate, occu¬ 
 pied by them, with ample area for all 
 buildings necessary for their purposes. 
 
 While all corporations should en¬ 
 deavor to comply strictly with the 
 law of their creation, and confine 
 themselves strictly within the powers 
 granted to them, corporations created 
 for religious purposes should be pre¬ 
 eminent in their strict adherence to 
 the laws of their creation, and the 
 powers vested in them by the State. 
 They should, under no circumstances, 
 afford opportunity to criticism on 
 those grounds, and certainly should 
 not so act as to warrant the State 
 creating them in taking action to re¬ 
 strain what may be an abuse of cor¬ 
 porate power. 
 
 II. 
 
 WHAT POWER DO THE BOARDS POSSESS 
 TO INVEST IN REAL ESTATE, FUNDS 
 GIVEN FOR THE PURPOSES OF THE 
 BOARDS? 
 
 The statement of the Boards as to 
 how the necessary funds will be pro¬ 
 vided is as follows: 
 
 “The necessary funds will be provided 
 from the legacies of Mrs. Stuart, from funds 
 
 of the Boards which must bo permanently 
 invested, and from the proceeds of the sale 
 of the present property at 12th street and 
 Fifth avenue; any balance above these 
 amounts that may be needed will be secured 
 by a mortgage on the property on which 
 the building is to be erected.” 
 
 The Boards do not give us a de¬ 
 tailed statement “of the funds of the 
 Boards which must be permanently 
 invested” that are to be so used. 
 
 Whose funds and from whom re¬ 
 ceived. Have the Boards the power 
 to so use such funds and if so, ought 
 they do to so ? Will the principal re¬ 
 main permanently safe in such an 
 investment ? 
 
 The will of Mrs. R. L. Stuart, by 
 which these legacies were given, in 
 item 24 provided as follows: 
 
 “ 24th. I give, devise and bequeath one 
 equal one-half part of all the rest, res¬ 
 idue and remainder of my estate, real and 
 personal, to the following named corpora¬ 
 tions and institutions: The American. 
 
 Bible Society, The Board of Foreign Mis¬ 
 sions of the Presbyterian Church in the 
 United States of America, incorporated by 
 an act of the Legislature of the State of 
 New York; The Board of Home Missions 
 of the Presbyterian Church in the United 
 States of America, incorporated by an act 
 of the Legislature of the State of New 
 York ; The Presbyterian Hospital in the city 
 of New York, situated on Madison avenue- 
 and 70th street and 71st street, incorpo¬ 
 rated by the Legislature of the State of New 
 York.” 
 
 MRS. STUART’S LEGACIES. 
 
 The three hundred and fifteen 
 thousand dollars used in the purchase 
 of the site; the one hundred and 
 twenty-five thousand dollars used by 
 the two Boards for current needs, and 
 an estimated sum of one hundred and 
 sixty thousand dollars yet to be re¬ 
 ceived under said legacies, which it is 
 proposed to use in this investment, 
 constitute as we understand it, the 
 total amount of said iegacies to 
 
II 
 
 the two Boards under the will of 
 Mrs. Stuart. This makes a total 
 from Mrs. Stuart’s estate of six hun¬ 
 dred thousand dollars for Home and 
 Foreign Missions; one hundred and 
 twenty-five thousand dollars have 
 been used for the current work 
 of the Boards, leaving four hun¬ 
 dred and seventy-five thousand dol¬ 
 lars of the same to be invested in 
 the new building and site. The money 
 thus given by Mrs. Stuart was without 
 any limitation, restriction, or direction, 
 so far as her will is concerned. Every 
 dollar of it was available for the cur¬ 
 rent needs of the Board, exactly as is 
 the money contributed by the churches 
 to the Boards for their current work 
 from year to year. 
 
 The sum of three hundred and fif¬ 
 teen thousand dollars paid on account 
 of the site, could have been used by 
 the Boards to meet, so far as it would 
 have done so, the needs of the Boards 
 for their current work, just as the sum 
 of one hundred and twenty-five thous¬ 
 and dollars, forming a part of the 
 same legacies, had been already used. 
 The language of the Boards in their 
 statement on this subject is as follows: 
 
 “ Of her (Mrs. Stuart’s) legacies, the 
 Boards used one hundred and twenty-five 
 thousand dollars in current work, and the 
 remainder has been availed of in part pay¬ 
 ment for the property corner of 20th street 
 and Fifth avenue.” 
 
 DR. ROBERTS AND THE LEGACIES. 
 
 One of the secretaries of the Home 
 Mission Board,—Dr. Roberts,— in 
 urging this new Mission Home project 
 before the joint committee of the As¬ 
 sembly at Saratoga, stated that he had 
 had several conversations with Mrs. 
 Stuart before her death, in which she 
 
 stated that she desired to see a per¬ 
 manent fund created, the income of 
 which would pay all expenses, and 
 leave the entire contributions of the 
 Church for the work, and which would 
 also be a basis of credit upon which 
 the Boards could secure such tempo¬ 
 rary loans as were necessary to carry 
 on the work before the contributions 
 had been received from the churches. 
 How Mrs. Stuart’s money, having been 
 used in the purchase of real estate on 
 which a mortgage for one million dol¬ 
 lars has been given, can still be used 
 as a basis of credit it is difficult to see. 
 
 The Boards in their statement say: 
 “When this question (the question of 
 providing increased accommodation 
 for the Boards) was pending, the death 
 of Mrs. R. L. Stuart brought to the 
 Boards legacies of over five hundred 
 thousand dollars. It was definitely 
 known that Mrs. Stuart had expressed 
 a desire that a large part of her gift 
 should be retained as a permanent 
 investment, and was only deterred 
 from fixing the amount by the advice 
 of her executors.” 
 
 THE WILL, AND IT ALONE, DETERMINES. 
 
 No such statements appear in the 
 will of Mrs. Stuart. Nothing is said 
 in her will such as is reported by Dr. 
 Roberts as having been said by her, 
 or as is stated in the circular of the 
 Board. The law does not permit the 
 plain terms of a last will and testament 
 to be varied or construed by oral testi¬ 
 mony. No rule of law is more rigidly 
 adhered to by the civil courts than 
 this one. No instrument is more 
 sacredly guarded by civil courts than 
 the last will and testament of a de¬ 
 ceased person. The law will not 
 
12 
 
 permit the living to make a diff¬ 
 erent will than what the testator 
 has left as his solemn act. The will 
 and the will alone can be looked to 
 for the intentions and purposes of the 
 testator, as a will speaks solely from 
 the death of the testator. 
 
 Therefore, whatever may be said as 
 to what was in Mrs. Stuart’s mind 
 before her death, as expressed to 
 others, the Boards in charge of her 
 legacy, and all persons interested 
 therein, must follow strictly the terms 
 of her will, and can not be governed 
 or controlled in opposition thereto by 
 any wishes expressed by her, or con¬ 
 versations had with her, other than 
 are set out in her last will and testa¬ 
 ment. Our Church should give no 
 uncertain sound on this subject, so 
 that those who may desire to make 
 gifts to the Church by will, will know 
 that it is the policy of the Church, as 
 it is the invariable policy of the civil 
 courts, to be guided by the will and 
 the will alone in the administration of 
 legacies given to it, and not to attempt 
 to enlarge or construe its terms by the 
 oral declarations of another. 
 
 Where money is left without any 
 specific direction for permanent in¬ 
 vestment, the presumption is that it is 
 left for the current needs of the Board 
 to which it is given. Where a sum of 
 money left to the Boards is too large 
 to be used for the current needs of the 
 Boards in one or two years, the Boards, 
 of necessity, must find an investment 
 for the surplus in excess of the actual 
 needs of the Boards. But where the 
 sum is not in excess of the actual 
 needs of the Boards, and where, as in 
 the case of the Boards of Home and 
 
 Foreign Missions, legacies form a large 
 part of its income for its current needs, 
 the Boards should have no authority 
 to use the money in real estate invest¬ 
 ments. 
 
 HOW MRS. STUART’S MONEY IS IN¬ 
 VESTED. 
 
 Assume that Mrs. Stuart had di¬ 
 rected that all or the greater part of 
 her legacies should be permanently 
 invested, and the income alone used 
 for the purposes of the Boards, would 
 that have justified the boards in in¬ 
 vesting the $475,000 they have in¬ 
 vested in a second mortgage, as 
 has been done, and that too where 
 the security depends upon the main¬ 
 tenance of sufficient fire insurance in 
 responsible companies? Surely Mrs. 
 Stuart’s legacies, if they were to be 
 permanently invested and the income 
 alone used, should have been invested 
 as a first mortage, in unencumbered 
 real estate, where the principal would 
 be reasonably safe. It seems clear 
 to us that the magnificent gifts of 
 Mrs. Stuart should have been so se¬ 
 curely invested—if authority existed 
 for their investment, instead of being 
 used for the payment of the salaries 
 of the home and foreign missionaries, 
 as they could have been used, and as 
 one hundred and twenty-five thous¬ 
 and dollars of the legacies were used 
 —that the principal would be safe for 
 all time, and producing an income at 
 least equal to the average of ordinary 
 investments. 
 
 As the situation now is, the Boards 
 own the site and the building, with a 
 first mortgage for a million of dollars 
 to the Seamans’ Bank, and the four 
 hundred and seventy-five thousand 
 
dollars of Mrs. Stuart’s legacies, 
 and the proceeds of the sale of the 
 Lenox homestead, which will amount 
 to from three to four hundred thous¬ 
 and dollars, will form a part of that 
 investment, and will be subject to this 
 first mortgage of a million dollars. We 
 have thus a case of these Boards 
 taking over three quarters of a million 
 of dollars of the funds of the Church 
 and investing them in a real estate 
 investment which is practically a 
 second mortgage, whose security de¬ 
 pends upon the constant maintenance 
 of sufficient fire insurance in compa¬ 
 nies that will be responsible in the 
 event of loss. 
 
 We fail to see anything in the will 
 of Mrs. Stuart, or even in the state¬ 
 ments which it is said she made 
 touching the purpose of her gifts, 
 that would warrant the making of 
 such an investment by these Boards 
 of her money. Is it in the power of 
 these Boards, under the laws of New 
 York, to invest any of the permanent 
 funds, or any legacies made to it in 
 second mortgages, or in real estate 
 encumbered as this new site and build¬ 
 ing are encumbered ? What assur¬ 
 ance have the donors of large gifts to 
 these Boards that the money given, 
 even for permanent investment, will 
 be safeguarded and secured for the 
 purposes for which it is given, if the 
 Boards can so invest and so speculate 
 as they have done with the gifts of 
 Mrs. Stuart, and as they propose to 
 do with the gifts from the Lenox 
 heirs ? 
 
 Would Robert Lenox Kennedy, if 
 he had been alive, have approved of 
 the sale of Fifth Ave., and Twelfth 
 
 St., and the investment of the pro¬ 
 ceeds of the sale including the money 
 he gave for its purchase, in the new 
 site on Twentieth St., and Fifth Ave., 
 subject to a first mortgage of a million 
 dollars? 
 
 WHAT SHOULD BE THE POLICY OF THE 
 CHURCH IN MAKING PROVISION FOR 
 THE PREMISES NECESSARY TO CARRY 
 ON THE WORK OF HER RESPECTIVE 
 AGENCIES? 
 
 We come now to consider what is 
 involved in the policy pursued by the 
 Boards of Home and Foreign Mis¬ 
 sions in this matter. To provide in 
 part for the payment for the site and 
 the erection of the building on Twen¬ 
 tieth street and Fifth avenue, it is 
 proposed to sell the present premises 
 on Fifth avenue and Twelfth street. 
 According to the estimate of one of 
 the secretaries before the joint com¬ 
 mittee of the General Assembly in 
 1894, it is expected to realize between 
 three and four hundred thousand dol¬ 
 lars from the sale of the present 
 premises. I11 the event that the latter 
 sum is realized, the total cash invest¬ 
 ment of the Church’s money in the 
 new premises and building will be 
 eight hundred and seventy-five thous¬ 
 and dollars, less than one-half of the 
 estimated total cost of the site 
 and building. The remainder of the 
 money necessary to erect the building 
 and pay for the site has been borrowed, 
 and a mortgage to secure one million 
 of dollars has been given on the 
 property. Before the building can be 
 completed so as to pay any rental, a 
 period of at least two years will have 
 elapsed from April 15, 1893, th e date 
 of the purchase of the site. 
 
— 14 — 
 
 The Boards have been carrying a 
 loan of three hundred and forty thous¬ 
 and dollars, at 4^ per cent, interest, 
 on account of the purchase of the 
 site. This loan was made April 15, 
 1893. The interest on this loan for 
 two years will be thirty thousand six 
 hundred dollars. In addition to this 
 loan, the three hundred and fifteen 
 thousand dollars given by Mrs. 
 Stuart is invested in the ground, and 
 has been so invested since April 15, 
 1893, and it will remain unproduc¬ 
 tive until the net rental of the prop¬ 
 erty shall produce an income. If 
 this three hundred and fifteen thous¬ 
 and dollars had been invested May 1, 
 1893, at five per cent, it would have 
 netted an income to the two Boards 
 for two years of thirty-one thousand, 
 five hundred dollars. 
 
 INTEREST PAID AND INCOME LOST. 
 
 In the process of erecting the build¬ 
 ing, which will cover a period of from 
 twelve to eighteen months, sums ag¬ 
 gregating nearly one million dollars 
 will have to be borrowed to meet pay¬ 
 ments to contractors. These sums 
 will bear interest at four and one-half 
 per cent., and the aggregate interest 
 on the sums thus borrowed until the 
 completion of the building, will be 
 from fifteen to twenty thousand dol¬ 
 lars. We have thus an aggregate 
 interest charge or loss for the time 
 between the purchase of the site and 
 the completion of the building, 
 amounting to at least seventy-five 
 thousand dollars. Against this there 
 is an alleged credit, as per statement, 
 of about thirty-nine thousand dollars. 
 
 Assume that the building is ready 
 for occupancy at the end of two 
 
 years from the purchase of the site. 
 Before any net rental can be de¬ 
 rived, a sufficient number of stores 
 and offices must be rented, the income 
 from which will meet the entire fixed 
 charges for the operation of the 
 property,—taxes, insurance, elevator 
 and electric light plants, janitors and 
 manager of building. To manage such 
 a building, secure proper tenants, con¬ 
 trol servants and superintend the 
 operation of the electric lighting and 
 elevator plant, requires a high order 
 of ability which will command a 
 large compensation. All these fixed 
 charges will have to be met before a 
 cent can be applied to the payment of 
 the interest, even of the money bor¬ 
 rowed. 
 
 Why should the Presbyterian 
 Church adopt a policy involving the 
 
 risks, liabilities and losses incident to 
 such an investment, merely for the 
 
 purpose of securing premises to ac¬ 
 commodate its secretaries and clerks 
 in the distribution of the funds given 
 by the Church for Home and Foreign 
 Missions ? 
 
 Why should the Church sell the 
 present historic premises, which it 
 owns in fee, and without a dollar of 
 debt, and invest the proceeds in a lot 
 and building mortgaged for one 
 million dollars of debt, and which 
 debt, it is possible, may compel a sale 
 of the new premises ? If such a con¬ 
 tingency should happen the Church 
 would be without any home for its 
 work. 
 
 HOW ARE INTEREST AND DEBT TO BE 
 
 PAID ? 
 
 It is difficult to see how the Boards 
 of Home and Foreign Missions can 
 
— i5 
 
 purchase this site, erect this building, 
 and pay interest on the loans, without 
 affecting the current or permanent 
 funds, or both. 
 
 Cost of site, six hundred and seventy 
 thousand dollars ($670,000); cost of 
 building, one million and eighty thous¬ 
 and dollars ($1,080,000); total cost of 
 site and building one million seven hun¬ 
 dred and fifty thousand dollars, which 
 sum, at 4^2 per cent, per annum, would 
 net seventy-eight thousand, seven 
 hundred and fifty dollars ($78,750). 
 
 The building when completed, as 
 an investment, ought to net at least 
 4 per cent, annually, which on the 
 cost of one million, seven hundred and 
 fifty thousand dollars ($1,750,000) is 
 seventy thousand dollars ($70,000). 
 Assume that of the $1,750,000, the 
 church has paid from Mrs. Stuart’s 
 legacies and sale of present premises 
 seven hundred and fifty thousand 
 dollars ($750,000), leaving charged 
 as a loan on the property, one million 
 dollars. How is this loan to be paid 
 —principal and interest? The Boards 
 in their printed statement speak of a 
 sinking fund from rentals to pay prin¬ 
 cipal and interest. Before one dollar 
 of rental can be fairly applied to the 
 sinking fund for the liquidation of the 
 principal of the debt of one million 
 dollars, the property, after paying the 
 entire operating expenses, including 
 taxes, insurance, operation of ele¬ 
 vators, electric light, heating plants, 
 etc., ought to net at least seventy 
 thousand dollars ($70,000) per annum, 
 being a net of 4 per cent, on its total 
 cost. All this is to be done when 
 office buildings in our large cities are 
 a drug on the market. 
 
 Is it probable that this new mission 
 building will net seventy thousand 
 dollars ($70,000) per annum—4 per 
 cent, on its lowest estimated cost— 
 even when crediting the income with 
 a proper rental for offices occupied by 
 the Boards ? This it must do to meet 
 the lowest probable interest charged 
 on the loan made to erect it and to 
 pay the like rate of income on the 
 money of the Church invested 
 in it. 
 
 Assuming, and it is a very reason¬ 
 able assumption, that even when fairly 
 well rented, it may only net forty-five 
 thousand dollars ($45,000) per annum, 
 this will only pay the interest on the 
 million dollar loan, and will leave no 
 income whatever for the seven hun¬ 
 dred and fifty thousand dollars ($750,- 
 000) of the money of the Church in¬ 
 vested in the site and building, in 
 which event this sum of seven hundred 
 and fifty thousand dollars ($75o,ooo( 
 so invested by the Church would be 
 an absolutely profitless investment. 
 
 Suppose again that the net rental is 
 less than forty-five thousand dollars 
 ($45,000), and not able to pay the 
 interest charged on the million dollars 
 borrowed. In that event, the load 
 of debt will increase, while the 
 three-quarters of a million dollars in¬ 
 vested by the Church will be profit¬ 
 less. Thus the $475,000 given by 
 Mrs. Stuart for the work of Home 
 and Foreign Missions, may prove 
 utterly profitless to those causes. 
 
 The time may come in the Church’s 
 experience of such an investment 
 that nothing will remain but the 
 sale of the property to liquidate the 
 growing debt—and that at the risk 
 
— 16 — 
 
 of the loss of a considerable amount 
 of the money intrusted to the Church 
 by Mrs. Stuart and the Lenox heirs, 
 as well as the loss of the present 
 historic premises. 
 
 In the event of the depreciation 
 in the next fifty years of the prop¬ 
 erty on Fifth avenue and Twentieth 
 street, by such changes in value as 
 are likely to occur in all large cities, 
 who is to make good the loss to the 
 Church? What security have donors 
 to the various Boards, even in the 
 case of permanent investments, that 
 their principal will be kept intact 
 for all time to come, where they 
 have so ordered it, if the Boards can 
 invest that principal, or any part of 
 it, in the purchase of real estate and 
 the erection of large buildings, with 
 all the incidental and almost inev¬ 
 itable losses and depreciation which 
 occur in the course of years in all 
 large cities? 
 
 We do not propose to discuss 
 here whether it is a wise policy to 
 have the Boards of Home and For¬ 
 eign Missions permanently located 
 on the eastern seaboard of this 
 country. Many reasons can be 
 given why the Board of Home 
 Missions should now be located 
 nearer the center of the country. 
 What we desire to do is to direct 
 the mind of the Church to the im¬ 
 portance of adopting a permanent 
 
 policy with regard to the use and 
 investment of all funds committed 
 to the keeping of its respective 
 Boards, in order that donors may 
 feel that security which the Church 
 ought to give them to warrant them 
 in using their wealth for the purpose 
 of building up the Kingdom of Jesus 
 Christ through the agency of our 
 Church. And the mind of the 
 Church should be directed to the 
 further question of how far such 
 Boards should go in the matter of 
 premises for their work. 
 
 We submit, that engaging in in¬ 
 vestments of such magnitude in real 
 estate and buildings, involving prob¬ 
 able depreciation and loss, more or 
 less inevitable, and liabilities for 
 negligence in their management, 
 may not commend itself to those 
 who have money to give to the 
 various causes represented by the 
 various Boards of our Church. A 
 withdrawal of such a large principal 
 on such a small net income, or with¬ 
 out income, is a questionable policy, 
 especially in the case of Home and 
 Foreign Missions, which should lie 
 so close to the heart of the Church, 
 and which should be mainly carried 
 on by regular contributions for the 
 current needs of their work. 
 
 Yours truly, 
 
 Thos. McDougall. 
 Cincinnati, O., March 12, 1895.