Vanderbilt Museum v. American Ass'n of Museums

• Decision Date: 25 March 1982
• Citation: 449 N.Y.S.2d 399,113 Misc.2d 502
• Parties: The VANDERBILT MUSEUM, Petitioner, v. AMERICAN ASSOCIATION OF MUSEUMS, Respondent.
• Court: New York Supreme Court

Page 399

449 N.Y.S.2d 399

113 Misc.2d 502

The VANDERBILT MUSEUM, Petitioner, v. AMERICAN ASSOCIATION OF MUSEUMS, Respondent.

Supreme Court, Special Term,

Suffolk County, Part I.

March 25, 1982.

Cahn, Wishod & Wishod, Melville, for petitioner.

Weber & Scharf, Massapequa, for respondent.

ELI WAGER, Judge.

The Vanderbilt Museum, petitioner in this Article 78 proceeding, seeks an order removing the proceeding to the Surrogate's Court, and the respondent American Association of Museums cross-moves for an order dismissing the petition upon the grounds that the Court lacks in personam and subject matter jurisdiction, that the petition is untimely, and that the petition fails to state a cause of action. The respondent has also moved for a pre-answer "final judgment" with respect to which both parties have submitted affidavits, exhibits and memoranda of law. The facts follow.

Facts

The Vanderbilt Museum is an educational corporation chartered by the New York State Board of Regents on July 15, 1949. In August 1949 it received power to administer a trust created under the last will and testament of the late William K. Vanderbilt. The will provided for conveyance to either the state, county or Town of Huntington of certain real and personal property located in Centerport, New York, at such time as the testator's wife should cease to use the premises as a residence, to be used as a public park and museum "and as such be devoted in perpetuity to the use, education and enjoyment of the public * * *." The will also provided for an initial maintenance fund of $2,000,000.00. The gift was accepted by Suffolk County, the property conveyed by the trustees of the Vanderbilt estate, and museum trustees were appointed by resolution of the county legislature in accordance with provisions of the charter. In 1975 a dispute between the museum trustees and the County led to a stipulation and judgment of settlement (in 1979) which delineated their respective powers, e.g., the County was stated to be the sole and exclusive owner of the real and personal property of the museum including the principal and interest of trust funds, but the use, occupancy, control and disposition of all such funds except the principal was stated to be in the museum trustees and all income from trust funds and from museum activities was to be paid over to them. The museum trustees were directed to adopt an annual budget and to file copies with the county executive and legislature, and the comptroller of Suffolk County was authorized to examine the trustees' books and records at any time. The stipulation empowered the trustees to hire employees and provided for staggered terms for the trustees themselves and that not more than a majority of them "shall belong to the same political party."

On October 10, 1980 the accreditation which had been granted to the museum by the respondent American Association of Museums (the "Association") in 1971 was "suspended" by the Association Commission, although the recommendation of the Association's "Visiting Committee" had been that "accreditation be tabled for one year." By letter dated December 9, 1980 the museum's appeal to the commission was denied. Subsequently (according to the affidavit of an assistant county attorney submitted as an exhibit here by the petitioner), the county executive ordered an investigation into the loss of accreditation and an audit as provided for in the stipulation of settlement. The trustees immediately commenced the instant Article 78 proceeding and two proceedings in the Surrogate's Court.

The Article 78 petition alleges that representatives of the respondent Association, which it is asserted "purports" to exercise the right to evaluate museums doing business in the State of New York, "visited, inspected and reviewed the operations of the petitioner within the County of Suffolk and State of New York as part of said purported reaccreditation process," that it "purported to suspend the accreditation of petitioner pursuant to the standards and policies set forth in Exhibit A" (the Association's published Professional Standards for Museum Accreditation) and subsequently denied petitioner's appeal. The respondent is alleged to have "failed to perform a duty enjoined upon it by law," to have "proceeded without and in excess of jurisdiction" and the determination is alleged to have been in violation of lawful procedure, arbitrary and capricious and an abuse of discretion and not on the entire record supported by substantial evidence. In its memorandum of law petitioner alleges that the Association violated its due process rights and exceeded its own jurisdiction when it suspended the museum's accreditation without prior notice or a hearing and without affording it six months within which to cure defects as allegedly required by the Association's accreditation procedures.

In the Surrogate's Court the museum trustees seek to judicially settle an account of their acts and to compel the County of Suffolk to account for its administration of the maintenance fund. Cited as persons having or claiming an interest in the proceedings, in addition to the Attorney General, the State Education Department and the County, is the Association (which is cited not as a statutory or necessary party but as one whose action may have significantly prejudiced the museum's ability to obtain financial grants). It is alleged in the petition for a compulsory accounting that the County of Suffolk has not filed any account as fiduciary and that it "appears that the substantial trust fund estimated to be $9,500,000 in value, may not be bringing an appropriate return, considering current market conditions." In the petition for a voluntary accounting the trustees allege that "questions have been raised publicly to the detriment of the trust by persons acting by or on behalf of the respondents as to (a) whether the petitioners are properly administering and using the property or income of this trust; (b) whether the Last Will and Testament of the deceased is being complied with in all of its terms and conditions; and (c) whether the maintenance, disposition or distribution of any of the trust property has in all respects been proper." Because the reputation of the Vanderbilt Museum has been damaged, the petitioner asserts, "it is essential to have a court of competent jurisdiction review all of the facts and circumstances relating to the Museum with a view toward finally resolving all issues which have so injured the Museum."

The Surrogate, upon a motion by the County and State Attorney General for an order of dismissal, determined that it had subject matter jurisdiction of the proceedings. "The surrogate's court," he wrote, "is the logical and proper forum for the rendering of an accounting in view of the fact that the grants herein are testamentary grants which involve fiduciary relationships. It is," he continued, "irrelevant that the museum's trustees are not fiduciaries as defined in SCPA 103(21)." In view of the fact that "the Suffolk County Executive and others have made serious allegations concerning the affairs of the museum which allegations have been the subject of widespread media coverage and comment" and that the "trustees in turn have publicly expressed accusations concerning the management of the maintenance fund by the county," it would, the Surrogate opined, "be in the public interest for the Surrogate to entertain the proceedings in question and conduct an appropriate inquiry as to the validity of these charges." The Surrogate also determined that the trustees had standing and, although no motion to dismiss as to the Association was before him at the time of his decision, the Surrogate determined that long-arm jurisdiction existed "since the Association purports to exercise a power of accreditation and evaluation over museums in the State of New York." He did not--and was not asked to--pass on the question of subject matter jurisdiction with reference specifically to the Association.

The Motion to Remove this Proceeding to the Surrogate's Court

The petitioner's motion to remove is stated to be upon the ground that the action affects the administration of a decedent's estate which is within the jurisdiction of the Surrogate's Court, the Surrogate's Court having first asserted jurisdiction in this matter. The museum's attorney alleges in his affidavit that there "is no logical way to separate the issues involved in this Article 78 Proceeding from those necessarily involved in the pending Surrogate's Court proceedings" in that the issues of trustee management and policies and fiscal responsibility which will necessarily be reviewed in the Article 78 proceeding "are irrevocably intertwined and inseparable from the issues which must be heard and determined in the Surrogate's Court proceedings." The Association asserts inter alia in opposition to the motion that the question of accreditation does not affect the administration of the Vanderbilt estate as required by CPLR 325(e).

Section 325(e) provides:

"Where an action pending in the supreme court affects the administration of a decedent's estate which is within the jurisdiction of the surrogate's court, the supreme court, upon motion, may remove the action to such surrogate's court upon the prior order of the surrogate's court. The right of jury trial shall be preserved in the subsequent proceedings."

It appears that the Surrogate has jurisdiction to determine ancillary matters over which it would not have had original jurisdiction (see e.g., Matter of Venblow, 2 A.D.2d 365, 156 N.Y.S.2d 267; Matter of Auditore, 223 App.Div. 654, 229 N.Y.S. 414, mod. 249 N.Y. 335, 164 N.E. 242; see 1 Syracuse L.Rev. 442). However, it also appears that it has no jurisdiction--ancillary or original--over matters over which the Supreme Court has exclusive jurisdiction. Section 12 of Article VI of the Constitution provides in pertinent part that:

"d. The surrogate's cou...