Cleveland’s Manna from Hanna: The Clear Intent of the Crucial Codicil UPDATED

Sleeping Watchdog: Ohio's Attorney General, Richard Cordray

According to recent press accounts, the Cleveland Museum has been publicly justifying its request for court permission to divert income from four acquisition funds to its capital campaign on ghoulish grounds---a theory that the deceased donors, were they alive today, would have wanted their money to be tapped to complete the museum's expansion. Never mind that they had expressly designated that money for art purchases, in the documents that established their trusts and endowments.

That may be how the museum's officials are spinning their unorthodox move to the press and the public, but that's not how the museum's case has been presented in its court filings, which include the donors' original documents as appendices. Cleveland's lawyer must have surmised that since judges don't have jurisdiction over the Great Beyond, they might have difficulty admitting arguments founded on speculation regarding beliefs of the deceased that were never committed to writing. In fact, the legal documents that they did leave behind unambiguously contradict such speculation.

Rather than channeling the wishes of the dead, the museum's brief asserts that the donors could not have foreseen the circumstances in which the museum now finds itself. If the museum doesn't expand, the donors' desire that acquisitions bought with their money be adequately displayed and properly cared for will be thwarted, the museum argues.

This ignores the fact that the benefactors may well have been quite aware that the museum would have future capital needs, but nevertheless wanted their money to go for precisely the purposes for which they designated it.

In no place is the donor's intent clearer than in mega-supporter Leonard Hanna's last will and testament, as revised by his second codicil.

Of the four purchase funds whose income Cleveland now hopes to tap for up to $75 million over the next 10 years, Hanna's is by far the largest: It distributed a net income to the museum in fiscal 2008 of $10.1 million, compared to $1.2 million, $1.7 million and $3.6 million from the three other funds now before the court.

In his will dated Nov. 7, 1952, Hanna made various specific bequests, leaving the remaining assets to the Cleveland Museum. Of the museum's money, $1 million was to be applied to general endowment, with the rest going to a purchase fund.

The will's text shows that Hanna had seriously pondered (and later rethought) the question of whether the money from his purchase fund should be applied to future capital projects. The 1952 will explicitly permitted withdrawals from his purchase fund for new construction, if two-thirds of the trustees voted in favor. This vote, however had to be taken "within seven years [emphasis added] from the receipt from my Executor of the approximate amount to be delivered to the Museum under this bequest....Unless the foregoing privileges are exercised by the Museum within the seven-year period hereinabove mentioned, they shall be deemed to be waived [emphasis added]." In other words, after that seven-year period, the money could no longer be applied to capital projects.

But there's more:

By the time of the second codicil to his will, dated Oct. 11, 1955, Hanna had changed his mind regarding the question of capital expenses. He REVOKED the above-quoted provisions, substituting new language that divided his bequest to the museum into two equal parts---general endowment funds and purchase funds. The income from the PURCHASE fund was designated for acquisitions (with no seven-year exception for capital expenses). The ENDOWMENT fund, on the other hand, COULD, by two-thirds vote, be applied to capital projects.

All of this demonstrates that Hanna clearly foresaw the museum's possible expansion needs and was equally clear about which of his funds could be and which could NOT be used to address those needs. Hanna's purchase fund, not his general-endowment gift, figures in the museum's current petition to Cuyahoga County Probate Court. Another of the four purchase funds at issue, the J.H. Wade Trust, stipulated that if the museum failed to "observe the terms and conditions [i.e., designation for acquisitions] imposed upon it by this agreement," the museum would forfeit its right to the money.

Despite all this, Ohio Attorney General Richard Cordray has bought the museum's argument, abdicating his responsibility to safeguard donor intent and enforce the terms of the benefactors' trusts and bequests. In his article that broke the news of the museum's court petition, Steve Litt of the Cleveland Plain Dealer quoted Cordray providing this astonishing justification of Cleveland's dicey diversion of purchase funds to its expansion project:

It doesn't do much good to buy art once you run out of space, because you're going to stick it in the basement.

This line of "reasoning" ignores not only the donors' enforceable legal documents but also the fact that few if any museums expect to display permanently everything that they own and all that they acquire. Some objects are arrayed in the galleries; many are kept behind the scenes for study, loan and temporary display in changing installations and exhibitions. That's the way it is in Cleveland and always will be, no matter how large the museum grows.

What we haven't heard yet is whether any heirs of the donors have been heard from. I have a query in to the museum's press office as to whether any objections have been voiced or briefs filed by family members.

I'll update here (or in a new post, if warranted), if and when I receive an answer.

In the meantime, the Association of Art Museum Directors, which yesterday told me that it was awaiting the court decision before deciding what, if anything, to do about this deplorable situation, should take a forceful stand now.

At stake is the confidence of present and future donors that museums can be trusted to honor their wishes and will not try to circumvent them, once the donor is safely underground, through posthumous mind-reading. Cleveland's actions, unchecked, would set a dangerous precedent that could have a negative impact on future benefactions, just when museums need help the most.

UPDATE: This hit my inbox late this morning, but I've only just returned to my e-mails after another press-preview day. James Kopniske, spokesperson for the Cleveland Museum, writes:

No one, heir or otherwise, other than the named parties (KeyBank and the Attorney General) has entered an appearance in the case or filed any papers with the court. The museum has worked closely with KeyBank, the trustee for two of the funds involved and the Attorney General and both have filed answers with the court consenting to the museum's request.