Cy Pres Doctrine

Vincent D. and Jane M. Hummel hadreceived care at Child’s Hospital, and made it the beneficiary of trust’s theyeach established, so that when they were both deceased, the hospital would geta portion of the residue. Before they had both died, the hospital’s assests andfacilites were purchased by another organization, AMC and its subsidiary AMC-SS,and it had to change its name Episcopal Charities and cease operation as ahospital. After both settlor’s had died, AMCwas awarded the residue and Episcopal appeals.The court in In reHummel (N.Y.A.D. 3 Dept., 2006) said:

The cy pres doctrine only applieswhere “ ‘the testator’s specific charitable purpose is no longer capable ofbeing performed by the trust’ and … the testator had a general charitableintent”. (citation omitted).

Here, thetrust documents evince a general charitable intent on behalf of the Hummelsand, because no hospital or corporation named Child’s Hospital exists,circumstances have changed making it impossible to carry out the specificcharitable purpose of the trusts. Under these circumstances, pursuant to [thestatute], the court was obligated to fashion a disposition of the trustproperty that, in the court’s judgment, would “most effectively accomplish itsgeneral purposes” [statute cited]. Based on the facts, including that theHummels were lifelong Methodists who had each received treatment at Child’sHospital, the court appropriately determined that the testators intended tobenefit the hospital operating at 25 Hackett Boulevard rather than theEpiscopal faith-based corporation that previously owned that hospital but wasnow precluded from operating a hospital.

Thus, AMC and AMC-SCC, as current operators ofthe hospital at 25 Hackett Boulevard, were entitled to receive that portion ofthe trust under the cy pres doctrine.