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Carl J. Herzog Foundation, Inc. v. University of Bridgeport

    Brief Fact Summary. The Carl J. Herzog Foundation made a gift to the University of Bridgeport to provide scholarships to nursing students. Later the University closed its school and applied the money from the gift to its general endowment.

    Synopsis of Rule of Law. A suit can be maintained for the enforcement of a charitable trust by the Attorney General or other public officer, or by a co-trustee, or by a person who has a special interest in the enforcement of the charitable trust, but not by persons who have no special interest or by the settlor, unless he expressly reserves the right to do so, or by the settlor’s heirs, persona representatives or next of kin. Under the Uniform Management of Institutional Funds act, Section, 7, an institution may be released from donatives restriction with the donor’s written consent or, if the donor is dead, disabled, or otherwise unavailable, with court approval.

    Facts. The Carl J. Herzog Foundation made a gift to the University of Bridgeport to provide scholarships to nursing students. Later the university closed its nursing school and added the funds to the general endowment. The Herzog Foundation brought suit to bring an injunction to reestablish the scholarships and give the money to the Bridgeport Area Foundation to administer scholarships.

    Issue. Whether a donor has standing to enforce the terms of a charitable gift?

    Held. No. Since the Herzog Foundation did not expressly retain the right to enforce the terms of the gift, they have no standing to bring suit. A suit may only be maintained by the Attorney General, a public officer, a co-trustee, or a person who has a special interest in the enforcement of the rust. Furthermore, the foundation does not have standing under section 7 of the Uniform Management of Institutional Funds Act because the drafters of the act expressly provided that the donor of a completed gift would have no standing to enforce the gift.

    Discussion. The Herzog Foundation should have reserved the right to sue to enforce the gift.


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