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Lead Stories
Is Law Firm Liable for Malpractice When Nonprofit Exec’s Husband Reviews Pay?
Counsel helped review wife’s deferred compensation which is subject of wife’s suit against Foundation
When the former executive vice president of the Fidelco Guide Dog Foundation sued the Foundation for its refusal to honor a deferred compensation agreement, the Foundation cross-claimed against the exec’s husband and his law firm which had been counsel to the Foundation at the time of the transaction. A trial court in Connecticut has refused to grant summary judgment to the law firm to dismiss it from the case. (Levin v. Fidelco Guide Dog Foundation, Superior Ct., CT, Hartford, No. CV 106008853S, 8/31/11.)
Trust for Benefit of Hospital May Go To Successor of Med School in Cy Pres
Court says donor would have approved use for provision of healthcare in clinics in area
Can you follow the bouncing ball? After more than seven years of litigation, an appellate court in Pennsylvania has decided who should receive the benefit of a trust left for a Philadelphia hospital that has gone through several reorganizations, bankruptcy, sale to a for-profit company, and dissolution since the donor’s death in 1919. The Court has affirmed award of the income to one of the successor organizations created out of the bankruptcy of the Allegheny Health, Education and Research Foundation (“AHERF”) in 1998. (Estate of Elkins, Pa. Superior Ct., No. 2147 EDA 2009, 9/1/11.)
City Can’t Force Hospital To Maintain Service
Court dismisses suit claiming violation of Title VI, breach of charitable trust, and breach of contract
A federal District Court in Ohio has dismissed a suit by the Mayor and City of Cleveland seeking to force the Cleveland Clinic Foundation to maintain its service and Level II trauma center at Huron Hospital in East Cleveland. The Court has held that the City did not state a claim under Title VI of the federal Civil Right Act, did not have standing to claim a breach of charitable trust, and was not a party to tax-exempt bond financing documents that could claim a breach of contract. (
Nonprofit Law YOU Want to Know
We regularly feature answers to questions from readers in our “Your Legal Questions Answered” column. The full list can be viewed on the site.
Must board report embezzlement?
Mortgage Broker Not Liable When Co-Pastor Misuses Funds
Bankruptcy Court recognizes breach of duty, but says conduct was not a substantial factor in harm
A mortgage broker who helped a church procure three mortgage loans that were signed by a co-pastor but never authorized by the pastor or the board has been found not liable to the church for funds apparently diverted by the co-pastor for other uses. A bankruptcy court in California has held that even though the broker breached a duty to the church, its conduct was not a “substantial factor” in the harm. (In re: Church of God in Christ #2 v. BDM Mortgage Services, Bankruptcy Ct., N.D. CA, Bankruptcy No. 08-30750, 10/20/11.)