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Where property has been devoted to a public or charitable use which cannot be carried out on account of some illegality in, or failure of the object, it does not, according to the general law of charities, revert to the donor or his heirs, or other representatives, but is applied under the direction of the courts, or of the supreme power in the state, to other charitable objects lawful in their character, but corresponding, as near as may be, to the original intention of the donor. The authority thus exercised arises, in part, from the ordinary power of the court of chancery over trusts, and, in part, from the right of the government, or sovereign, as parens patrice, to supervise the acts of public and charitable institutions in the interests of those to be benefited by their establishment; and, if their funds become bona vacantia, or left without lawful charge, or appropriated to illegal purposes, to cause them to be applied in such lawful manner as justice and equity may require
The Church of Jesus Christ of Latter-Day Saints was incorporated February, 1851, by an act of assembly of the so-called State of Deseret, which was afterwards confirmed by act of the territorial legislature of Utah, the corporation being a religious one, and its property and funds held for the religious and charitable objects of the society, a prominent object being the promotion and practice of polygamy, which was prohibited by the laws of the United States. Congress, in 1887, passed an act repealing the act of incorporation, and abrogating the charter; and directing legal proceedings for seizing its property and winding up its affairs. The district court found that the church’s charitable corporation was validly dissolved by Congress. The Church sought review of the judgment.
Did Congress have the power to repeal the act of incorporation of the Church?
The Court held that Congress had the power to repeal the act of incorporation of the Church of Jesus Christ of Latter-Day Saints, not only by virtue of its general power over the Territories, but by virtue of an express reservation in the organic act of the Territory of Utah of the power to disapprove and annul the acts of its legislature. The Court noted that it would be absurd to hold that the government had the power to acquire a territory but no power to govern it and held that Congress had the authority to dissolve the church's corporation. The Court found that the government also had the power to seize the property of the church under parens patriae principals and to redirect its use for charitable purposes within the territory. The Court noted that because the church was a charitable corporation there were no stockholders for the property to evolve to, so escheat to the government was proper. The Court further noted that the property was properly not transferred to the church members, because their activities since the transfer of the property from the church to them showed that they were using the property to further the outlawed polygamy.