More than fifty years ago, a charitable woman executed her Last Will and Testament, bequeathing all of her assets to two Catholic charities in the event that her siblings did not survive her. The two Catholic charities named in the Will were the Columbus Hospital and St. Joseph Rest Home for the Aged, each to get 50% of her estate. Both of these institutions were founded or operated by Italian American Catholic Orders.
In March 2008, the woman passed away, leaving
more than $3,000,000 worth of assets in her estate. Since her siblings
predeceased her, the Will left everything to the two Catholic charities.
Demise of Columbus/Cabrini Hospital
Columbus Hospital was founded in 1892 and
operated a hospital in Manhattan. It was opened by a mission of the Missionary
Sisters of the Sacred Heart of Jesus to address the needs of Italian
immigrants. In 1973, Columbus Hospital and Italian Hospital merged to form
Cabrini Medical Center. Cabrini Medical Center operated as a hospital on the
same site as Columbus Hospital on East 19th Street until it filed
for bankruptcy on July 9, 2009. Through the bankruptcy proceedings, Memorial
Sloan Kettering Cancer Center purchased the buildings in which Cabrini Medical
Center was formerly located.
Charitable mission of St. Joseph Rest Home for the Aged
Similarly to Cabrini, St. Joseph Rest Home for
the Aged was founded by Nuns whose lives are committed, without compensation,
solely to their charitable and religious convictions. Both charitable organizations
— Cabrini and St. Joseph — were founded and operated by Nuns of Italian
heritage. The Order of St. Joseph’s was founded in Rome by Italian Nuns and
still has a mother house located in the Vatican. St. Joseph’s Rest Home for the
Aged, which operates a licensed nursing home facility that accommodates forty
women, was founded by the Catholic Sisters of The Order of St. Joseph’s and is
located in Paterson, New Jersey.
Accounting proceeding
Because Columbus Hospital had ceased to exist,
the executor of the deceased woman’s estate filed a judicial accounting with
the Surrogate’s Court, requesting that the Surrogate give the 50% share
originally meant for Cabrini Hospital to Memorial Sloan Kettering. The executor
indicated that the bequest originally meant for Cabrini should be given to
Memorial Sloan Kettering because the deceased had been treated there.
The Chairman of the Board of Directors of St.
Joseph contacted Richard A. Klass, Your Court Street Lawyer, about
objecting to the bequest to Memorial Sloan Kettering and, instead, requesting
that the Surrogate pay the entire net estate to St. Joseph Rest Home for the
Aged.
Cy Pres doctrine
There is a centuries’ old doctrine of cy pres (pronounced “sigh – pray”),
which is a rule that when literal compliance with a Will or trust is
impossible, the intention of a donor or testator should be carried out as
nearly as possible. This is especially true when a bequest to a charity has
“lapsed” as the result of the charity no longer existing to receive the bequest;
then the Surrogate may designate another charity in its place.
In the seminal case of In re Brundrett’s Estate [1940], a percentage of the remainder of
the estate was left to St. Mark’s Hospital, but the hospital was bankrupt in
1931 and ceased to operate as a hospital and perform the functions for which it
was originally incorporated. The court held that the gift to the hospital was,
therefore, ineffectual. The court then applied the doctrine of cy pres and paid over that charity’s
portion to the other charitable ‘remaindermen’ named in the Will (the term
‘remaindermen’ refers to others who receive the residuary or balance of an
estate).
Following the holding in In re Brundrett’s Estate, the court in In re Shelton’s Estate [1942] was faced with a similar issue as
presented here. In that case, the decedent left moneys to a charitable
institution located in Italy that was maintained by a New York religious
corporation. After the death of the decedent, the New York religious
corporation relinquished its maintenance of the Italian institution and
discontinued all of its religious and charitable activities. Although its
officers continued to function, it was a “charity in name only.” The court held
that the discontinuance of the charitable and religious functions precluded
authorization of payment of the legacy to the entity. However, the court
recognized that the decedent had charitable intentions to provide a gift for
religious purposes and invoked the doctrine of cy pres. In granting the legacy originally left to the Italian
charity to the other charitable legatee, the court in In re Shelton’s Estate held: “By the application of that doctrine [cy pres] the surrogate holds that the
legacy did not lapse and may be paid to The Cathedral Church of St. John the
Divine in the City and Diocese of New York, the other charitable legatees named
in the will and object of the generous bounty of the testatrix.”
After the objection to the judicial accounting by
St. Joseph, with sufficient case law being presented in support of the request
to pay the bequest of Cabrini Hospital over to St. Joseph, the executor agreed
to pay 100% of the residuary estate to St. Joseph, roughly $3 million in total.
The nursing home needs a new roof — now they’ll be able to afford it!
— Richard A. Klass, Esq.
Credits:
Photo of Richard Klass by Robert Matson, copyr. Richard A. Klass, 2011.
Newsletter marketing by The Innovation Works, Inc.
Image on page one: Salzgitter, Städtisches Altenheim, 1961, Maria retirement home in Tann, in a hospital room with a Dutch nun. Licensed under the Creative Commons Attribution-Share Alike 3.0 Germany license. Attribution: Bundesarchiv, B 145 Bild-F010160-0001 / Steiner, Egon / CC-BY-SA.
Newsletter marketing by The Innovation Works, Inc.
Image on page one: Salzgitter, Städtisches Altenheim, 1961, Maria retirement home in Tann, in a hospital room with a Dutch nun. Licensed under the Creative Commons Attribution-Share Alike 3.0 Germany license. Attribution: Bundesarchiv, B 145 Bild-F010160-0001 / Steiner, Egon / CC-BY-SA.
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copyr. 2012 Richard A. Klass, Esq.
The firm's website: www.CourtStreetLaw.com
Richard A. Klass, Esq., maintains a law firm engaged in civil litigation at 16 Court Street, 29th Floor, Brooklyn Heights, New York.
He may be reached at (718) COURT-ST or e-ml to RichKlass@courtstreetlaw.com with any questions.
Prior results do not guarantee a similar outcome.
