In the Matter of The Eleanor M. Weisbrod Endowed Scholarship, Docket No. A-2199-21 (N.J. Super. App. Div. April 6, 2023)

This decision addresses an application by Georgian Court University (GCU) to modify the criteria for awarding scholarships from a fund (“Fund”) established by Eleanor M. Weisbord (“Weisbrod”).

Weisbrod graduated from GCU in 1944.  Her major was math.  At the time she attended, all of the students were female, and most of the students were Catholic and resided on campus.

In 1989, Weisbrod established the scholarship through a gift agreement which provided that the income from the “perpetual” endowment was to be used for “scholarship purposes.”  Weisbrod at *3.  The agreement further stated that the scholarships “shall be made to mathematics majors who are Catholic, full-time students with need” who maintain a GPA of 3.0.  Id.

In 1996, Weisbrod created a trust.  She restated that trust several times.  The trust provided that at her death a percentage of the trust property would be added to the Scholarship.  The trust also stated, “The recipient(s) of the [s]cholarship(s) will be financially needy students of academic excellence in undergraduate school, being a full-time resident student in the field of Mathematics.”  Id.

In addition, the trust funded two other scholarships at GCU:  one for undergraduate students in the field of education; and one for graduate students in the “field of the recipient’s own selection.”  Id. at *4.

Weisbrod died in 2008.  In the following two years, the scholarship endowment grew from less than $200,000 to over $1.5 million, due in part to additional funding from the trust.

The Fund’s growth continued and by June 2020 was over $4.1 million.

In the meantime, the demographics of GCU students changed.  The student population decreased by 16%, and the number of female undergraduate students decreased by 26%.  Less than 50% of the students were Roman Catholic and only 22% of undergraduates lived on campus.  Moreover, in 2021 less than 1.5% of the students were full-time, female math majors.

As a result, only a relatively small number of students met the scholarship criteria.  From 2010 forward, over $1.3 million of the Fund was not distributed because of the restrictions placed on the awards.

In July 2021, GCU applied to the court to modify the scholarship terms in three ways, so that the funds could be awarded to: (1) students of all religious faiths; (2) commuter students; and (3) students pursuing math-based and science-based majors.  However, GCU did not seek to change the terms that the awards be to female students, with financial needs, and having a 3.0 GPA.

GCU relied on a certification from Weisbrod’s longstanding attorney.  He had prepared her will and trust.

The New Jersey Attorney General did not object to the proposed modifications but took the position that the modifications should be awarded on a tiered basis.  GCU agreed to modify the requested relief accordingly.  A proposed consent order was submitted.

The trial judge denied GCU’s application without argument or a hearing.  The judge did not consider the tier-based plan reflected in the consent order.  Instead, the court concluded that Weisbrod did not intend to allow changes to the scholarship terms.

GCU moved for reconsideration and submitted a certification from its Vice President for Institutional Advancement providing additional information about the scholarship and the student body.  The Attorney General raised no objection.

The trial court heard argument on the reconsideration motion and on two later dates heard additional arguments from GCU.  Ultimately, the trial judge allowed the commuter-student modification but denied the modifications based on religion and academic major.  The judge relied “on unidentified materials he had independently searched for and read,” and determined that Weisbrod had strong beliefs in her Catholic faith and her math training.  Id. at *7.

In the end, the trial judge allowed the modifications except those to allow awards to students of any religion and to students pursing math-based and science-based majors.

GCU appealed.

After summarizing the standards for cy pres relief, the Appellate Division found that the trial judge had committed errors by not conducting a hearing and by instead making his own findings on Weisbrod’s intent, relying on information outside the record that he apparently looked up but did not identify.

The Appellate Division reversed the trial judge’s rulings and remanded the case for a new hearing.  Further, the appeals court directed that the new hearing be conducted by a different judge, since the original one had already expressed his views based on evidence outside the record.

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