President of Harvard College v. Attorney General

De Courcy, J. The question presented by this bill for instructions is whether the plaintiff corporation lawfully can carry out an agreement, duly made by it with the Massachusetts Institute of Technology, “as far as respects the property received by it under the deeds of trust and the will of Gordon McKay.” The agreement (above set forth in full) assumed its final form in February, 1915. Speaking generally, it purports to establish a co-operative arrangement between Harvard University and the Institute “in the conduct of courses leading to degrees in Mechanical, Electrical, Civil and Sanitary Engineering, Mining and Metallurgy, and in the promotion of research in those branches of Applied Science.” To the maintenance of the plan the University agrees to devote, in addition to other income and equipment, “not less than three-fifths of the net income of the Gordon McKay Endowment.” On analyzing the material provisions of the plan, and considering them in their practical application, we are led to certain salient conclusions as to what the agreement accomplishes: Education and research in the five branches covered by the agreement are to be transferred from the University to the Institute, and there conducted under the provisions of the agreement as part of the latter’s curriculum. The Harvard professors associated with those courses shall become members of the faculty of the Institute, and the property and equipment which the University may hold for the promotion of instruction in industrial science shall be devoted to the courses as so conducted. All students who take these engineering courses are to register at the Institute only, and pass under its jurisdiction. It seems to us that they will become a part of its complete and distinct life, even though they are entitled to make use of the museums,' libraries and playgrounds of the University, and to receive the degree of both institutions on completing any of the engineering courses. The faculty which determines the conditions of entrance, prescribes the courses that lead to degrees, largely shapes and carries into practical application the instruction and discipline of the school, and mainly influences the appointment of professors, is the faculty of the Institute, notwithstanding that fourteen of its one hundred and twenty members come from the University. The president of the Institute is made the executive — 407 — head of all the work carried on under the agreement. The amendment that he “for that purpose shall be the agent of the University as well as of the Institute” does not in fact enlarge the control of the University. The relation of the president of the Institute to the work is the relation of the Institute itself. Finally, the funds available for carrying out the plan are to be expended through the bursary of the Institute. And although “all proposed appropriations shall be approved by the Corporation that supplies the funds,” that apparently leaves little real power in the University, as the total expenses of the school for any academic year are a fixed quantity, and the total contribution of the University is settled by the agreement. Considered as a whole, the plan appears practically to vest in the Institute the substantial organization, control, direction and administration of the work to be done under the agreement, and to commit to the Institute the money of the McKay endowment, and the work of planning and carrying out the engineering education provided thereby. In substance; it devotes three fifths of the income of the endowment to an engineering school, which is not only located at the Institute, but is conducted and controlled by the Institute instead of by the University. We cannot assent to the assertion of counsel that “the school of applied science on the Charles River embankment is a Harvard school, a department of Harvard University.” The Attorney General has not raised any question of ultra vires, and we assume that the University legally may use its general funds to carry out the agreement in question. There is no occasion here for the application of the cy fres doctrine because admittedly the trust can be administered. It may be assumed also that a co-operative plan like that proposed would be advantageous to both of these great institutions by creating one school of applied science of the highest efficiency, with economy in expenditure and effort, to take the place of two competitive schools. But so far as the agreement attempts to dispose of the income of the McKay gift, the controlling question is whether it is authorized by the terms and conditions of the trust upon which the gift was made and accepted. The income of the McKay endowment must be administered according to the intention of the founder, Gordon McKay, even though it be at variance with our views of policy or expediency. And that intention is to be gathered from the — 408 — trust instrument itself, read in the light of the attendant circumstances known to him, or reasonably presume^ to have been contemplated by him at the time it was made. Jackson v. Phillips, 14 Allen, 539, 592. Crapo v. Pierce, 187 Mass. 141. Crawford v. Nies, 224 Mass. 474, 490. The effective instrument is the deed of trust executed October 30, 1891, and confirmed by a codicil November 5, 1891. McKay • was then seventy years of age. He had been a successful manufacturer. and inventor of machinery. He was a man of artistic tastes, a lover of music, and had travelled extensively in Europe. From 1864 or 1865 for more than twenty years his home was in Cambridge, near the college yard; he took a leading part in supporting the Symphony concerts in Sanders Theatre, and was brought into friendly relations with many of the college teachers and students. He appreciated the advantage of combining training in the exact sciences with liberal culture in the atmosphere of the University. During all those years there was a close personal intimacy between him and the late Professor Shaler, long connected with the University, and appointed Dean of the Lawrence Scientific School in 1891; and with the latter McKay discussed his schemes for the disposition of his fortune. By his earlier trust deed of November 30, 1887, he gave $300,000 and his house in Cambridge to establish a home for deserving indigent females, and the residue of his estate to the University in trust for the establishment and maintenance of a separate school for instruction in the industrial arts and sciences, to be designated as the McKay School of Art; but these plans he abandoned in the deed of 1891. This later deed he never substantially changed during the remaining twelve years of his life, notwithstanding the negotiations of 1897-98 between the University and the Institute respecting a combined engineering school. He was familiar with the rapid development of the Lawrence Scientific School between 1891 and 1903 (the year of his death), and was accustomed to refer to it as “his school,” when questioning Dean Shaler as to its condition. In the light of this knowledge of McKay’s personality and history we examine the effective deed of trust of October 30, 1891. He first provides the funds for the Gordon McKay Endowment. In brief, after the payment of certain annuities, eighty — 409 — per cent of the net income of his estate is to be accumulated until it amounts to one million dollars, and then transferred to the plaintiff. Thereafter such eighty per cent is to be paid over annually until the death of the last annuitant, when the residue of the estate is to be paid. In passing it may be said that the trustees of the McKay estate paid the one million dollars to the University in 1909, and have paid the subsequent annual income up to January 1, 1917, amounting to $1,247,261.12. The income of these combined payments at four and a half per cent would be $101,126.75, and it will increase each year by reason of the annual payments to the University above mentioned. According to the computations of the actuary the probable date of the death of the last survivor of the annuitants is January 1, 1956. It is estimated that the capital of the endowment at that time will be $22,948,899.20. After providing for the investment of the endowment he sets forth the main trust and purpose as follows: “The net income of said Endowment shall be used to promote applied science: “ First, By maintaining professorships, workshops, laboratories and collections for any or all of those scientific subjects, which have, or may hereafter have, applications useful to man and “ Second, By aiding meritorious and needy students in pursuing those subjects.” He adds, “Inasmuch as a large part of my life has been devoted to the study and invention of machinery, I instruct the President and Fellows to take special care that the great subject of mechanical engineering in all its branches and in the most comprehensive sense, be thoroughly provided for from my Endowment. “I direct that the President and Fellows be free to provide from the Endowment all grades of instruction in applied science, from the lowest to the highest, and that the instruction provided be kept accessible to pupils who have had no other opportunities of previous education than those which the free public schools afford.” Directions are given as to details, such as the salaries of professors, providing them with suitable assistance, and ensuring modern equipment of the best design and quality. He directs that the President and Fellows be “free to erect buildings for the purposes of this Endowment, and to purchase sites for the same, but only from the income of the Endowment.” Then follows: — 410 — “Finally, I request that the name Gordon McICay be permanently attached to the professorships, buildings, and scholarships or other aids for needy students, which may be established, erected or maintained from the income of this Endowment.” He inserted the further significant provision that, in the event of the failure of the University to accept the trust, the gift should go, not to any other existing institution, but to a new Massachusetts corporation which should be established to receive and apply the' endowment “for the purposes and upon the terms above set forth in respect to said gift to Harvard College.” Reading this instrument in the light of the circumstances already referred to, it seems reasonably clear from its express provisions and implied limitations that Mr. McKay intended that not only the investment of the endowment funds but the education which his endowment was to make possible should be under the control and direction of the University, its government and administration. He selected as the trustee to carry out his purposes a great educational institution, one with whose ability adequately to carry out his plans he was familiar, and with whose historic name he desired to associate his own. in perpetual memory. In our opinion this intention of Gordon McKay is not in fact carried out in the agreement in controversy, as we have construed its provisions in their practical operation. As was said by this court in Harvard College v. Society for Promoting Theological Education, 3 Gray, 280, 301, in dismissing the suggestion that the trust fund might be held by the college, and the income paid over to and applied by a separate school: “We find no authority for adopting such a scheme for these charities, finding the trust to embrace the higher duty of supervision of the administration of these funds, and the mode of their application; and the purpose of the donors being such as we have stated.” See also Winthrop v. Attorney General, 128 Mass. 258; Cary Library v. Bliss, 151 Mass. 364; Boston v. Hoyle, 184 Mass. 373, 381. What has been said disposes of the only question now before us for decision (aside from the rulings as to evidence, wherein we find no error), and it would be unwise as it is unnecessary to attempt to define in advance what particular administrative methods may legally be adopted by the University in carrying out the trust. — 411 — We are constrained to instruct the plaintiff that it cannot lawfully carry out this agreement between it and the Institute, as far as respects the property received by the University under the deeds of trust and the will of Gordon McKay. Decree accordingly.