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

• Citation: 677 A.2d 1378,41 Conn.App. 790
• Decision Date: 25 June 1996
• Docket Number: No. 14623,14623
• Court: Appellate Court of Connecticut
• Parties: , 110 Ed. Law Rep. 1145 CARL J. HERZOG FOUNDATION, INC. v. UNIVERSITY OF BRIDGEPORT

Page 1378

677 A.2d 1378

41 Conn.App. 790, 110 Ed. Law Rep. 1145

CARL J. HERZOG FOUNDATION, INC. v. UNIVERSITY OF BRIDGEPORT

No. 14623.

Appellate Court of Connecticut.

Argued Feb. 29, 1996.

Decided June 25, 1996.

John F. Lambert, Greenwich, for appellant (plaintiff).

Frederick S. Gold, New York City, with whom was Ellen A. Jawitz, for the appellee (defendant).

Before DUPONT, C.J., and FOTI and LAVERY, JJ.

DUPONT, Chief Judge.

The plaintiff Carl J. Herzog Foundation, Inc., appeals from the judgment of the trial court dismissing its action on the ground that it lacked standing to enforce the provisions of a charitable gift. The issue on appeal is whether the Connecticut Uniform Management of Institutional Funds Act (CUMIFA); General Statutes §§ 45a-526 through 45a-534; provides standing for the donor of a restricted charitable gift to seek to enforce the restriction when the governing board of the donee of that gift has not received the written consent of the donor to deviate from the restriction.

The plaintiff commenced an action against the University of Bridgeport seeking injunctive and other relief in connection with a gift made by it to the university. The plaintiff alleged in its revised complaint that prior to August 12, 1986, it made various grants to the defendant "to provide need-based merit scholarship aid to disadvantaged students for medical related education." On August 12, 1986, the plaintiff agreed, by letter, to participate in a matching grant program that would provide need-based merit scholarships to disadvantaged students for medical related education on a continuing basis. On September 9, 1986, the defendant wrote a letter accepting the offer of a matching grant of up to $250,000. Over a period of time, the defendant raised the necessary $250,000, which the plaintiff matched in accordance with the agreement. The plaintiff transferred $144,000 on June 26, 1987, and $106,000 on June 28, 1988, to the defendant. The grants were used to provide scholarships to students in the university's nursing program. On November 21, 1991, however, the plaintiff was informed that the university had closed its nursing school on June 20, 1991.

Pursuant to the provisions of CUMIFA, the plaintiff alleged that the defendant was an "institution" within the meaning of General Statutes § 45a-527(1), that the matching grant constituted "institutional funds" within the meaning of General Statutes § 45a-527(2), and that the letter of August 12, 1986, which set forth the restrictions and conditions of said grant, constituted a "gift instrument" as defined in General Statutes § 45a-527(6). See Yale University v. Blumenthal, 225 Conn. 32, 621 A.2d 1304 (1993).

The plaintiff's alleged injury is that the funds are no longer being used for their specified purpose. Paragraph fourteen of the revised complaint states: "The Herzog Foundation has been given to understand and believes that the said institutional funds have been co-mingled with the general funds of the University, that said institutional funds are not being used in accordance with the 'Gift Instrument' under which said institutional funds were transferred to The University of Bridgeport, and that said institutional funds have in fact been spent for general purposes of The University of Bridgeport."

The plaintiff requested a temporary and permanent injunction, ordering the defendant "to segregate from its general funds matching grants totaling $250,000," an accounting for the use of the fund from the date of receipt until present, and a reestablishment of the fund in accordance with the purposes outlined in the gift instrument, and, in the event that those purposes could not be fulfilled, to revert the funds and direct them to the Bridgeport Area Foundation, which is prepared to administer the funds in accordance with the original agreement.

The defendant moved to dismiss the suit for lack of subject matter jurisdiction on the ground that the plaintiff lacked standing. The trial court held that the act did not provide a donor with the right to enforce restrictions contained in a gift instrument, and, therefore, the plaintiff lacked standing to bring suit. The trial court noted that the attorney general, pursuant to General Statutes § 3-125, ¹ could bring suit to enforce the gift, and it dismissed the action.

A motion to dismiss admits all facts well pleaded and invokes any record that accompanies the motion, including supporting affidavits that contain undisputed facts. Barde v. Board of Trustees, 207 Conn. 59, 63, 539 A.2d 1000 (1988). A motion to dismiss raises the question of whether a jurisdictional flaw is apparent on the record or by way of supporting affidavits. Bradley's Appeal From Probate, 19 Conn.App. 456, 563 A.2d 1358 (1989). If a resolution of a disputed fact is necessary to determine the existence of standing when raised by a motion to dismiss, a hearing may be held in which evidence is taken. Weidenbacher v. Duclos, 234 Conn. 51, 54 n. 5, 661 A.2d 988 (1995). In this case there were no accompanying affidavits, no hearing was held and the defendant accepted the allegations of the plaintiff's complaint as true, for the purpose of the motion to dismiss only. There is no transcript and there are no exhibits. We, therefore, decide the appeal solely on the allegations of the plaintiff's complaint.

" 'Standing focuses on whether a party is the proper party to request adjudication of the issues, rather than on the substantive rights of the aggrieved parties.' Nye v. Marcus, [198 Conn. 138, 141, 502 A.2d 869 (1985) ]. 'It is a basic principle of law that a plaintiff must have standing for the court to have jurisdiction. Standing is the legal right to set judicial machinery in motion. One cannot rightfully invoke the jurisdiction of the court unless he has, in an individual or representative capacity, some real interest in the cause of action, or a legal or equitable right, title or interest in the subject matter of the controversy. Ardmare Construction Co. v. Freedman, 191 Conn. 497, 501, 467 A.2d 674 (1983), quoting Hiland v. Ives, 28 Conn.Sup. 243, 245, 257 A.2d 822 (1966). Standing is not a technical rule intended to keep aggrieved parties out of court; nor is it a test of substantive rights. Rather it is a practical concept designed to ensure that courts and parties are not vexed by suits brought to vindicate nonjusticiable interests and that judicial decisions which may affect the rights of others are forged in hot controversy, with each view fairly and vigorously represented.... These two objectives are ordinarily held to have been met when a complainant makes a colorable claim of direct injury he has suffered or is likely to suffer, in an individual or representative capacity. Such a personal stake in the outcome of the controversy ... provides the requisite assurance of concrete adverseness and diligent advocacy....' (Citations omitted; internal quotation marks omitted.) Unisys Corp. v. Dept. of Labor, 220 Conn. 689, 693, 600 A.2d 1019 (1991)." Weidenbacher v. Duclos, supra, 234 Conn. at 61-62, 661 A.2d 988. Thus, standing does not hinge on whether the plaintiff will ultimately be entitled to obtain relief on the merits of an action, but on whether he is entitled to seek the relief. Yale University v. Blumenthal, supra, 225 Conn. at 36, 621 A.2d 1304.

"Standing is established by showing that the party claiming it is authorized by statute to bring suit or is classically aggrieved. Cf. Zoning Board of Appeals v. Planning & Zoning Commission, 27 Conn.App. 297, 605 A.2d 885 (1992)." Steeneck v. University of Bridgeport, 235 Conn. 572, 579, 668 A.2d 688 (1995). "The concepts of 'standing' and 'legal interest' are to be distinguished. The legal interest test goes to the merits, whereas 'standing' concerns the question 'whether the interest sought to be protected by the complainant is arguably within the zone of interests to be protected or regulated by the statute or constitutional guarantee in question.' Association of Data Processing Service Organizations, Inc. v. Camp, 397 U.S. 150, 153, 90 S.Ct. 827, 25 L.Ed.2d 184 [1970]; see Ducharme v. Putnam, 161 Conn. 135, 139, 285 A.2d 318 [1971]." Mystic Marinelife Aquarium, Inc. v. Gill, 175 Conn. 483, 492, 400 A.2d 726 (1978).

The plaintiff claims that CUMIFA provides it with standing to bring suit in order to enforce the conditions of its gift. ² "Statutory aggrievement exists by legislative fiat which grants an appellant standing by virtue of particular legislation...." Buchholz's Appeal From Probate, 9 Conn.App. 413, 416, 519 A.2d 615 (1987). The issue, therefore, is whether CUMIFA establishes standing for the plaintiff by creating an arguably protectable interest, within the meaning of the statute, of the plaintiff in its capacity as a donor to an "institutional fund." A statute need not specifically provide that certain persons come within its protection in order to establish aggrievement as long as that protection may be implied fairly. Id., at 421-22, 519 A.2d 615; see Tomlinson v. Board of Education, 226 Conn. 704, 721, 629 A.2d 333 (1993).

General Statutes § 45a-533 provides that "[w]ith the written consent of the donor, the governing board may release, in whole or in part, a restriction imposed by the applicable gift instrument on the use or investment of an institutional fund." It is this section of CUMIFA on which the plaintiff relies in order to establish standing. It argues that § 45a-533 creates a right for a donor, namely, the right to consent or to withhold consent to the release of a restriction, which did not exist at common law. ³ The statutory right, the plaintiff argues, gives it standing to enforce the restriction. The plaintiff argues that if a donor cannot enforce the statute, by requiring a donee to obtain a donor's consent before a donee unilaterally abolishes a restriction, the statute would be rendered meaningless. The defendant argues that this statute...