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People Ex Rel. Scott v. Harding Museum

OPINION FILED MARCH 7, 1978.

THE PEOPLE EX REL. WILLIAM J. SCOTT, ATTORNEY GENERAL, PLAINTIFF-APPELLANT AND CROSS-APPELLEE,

v.

GEORGE F. HARDING MUSEUM ET AL., DEFENDANTS-APPELLEES AND CROSS-APPELLANTS.



APPEAL from the Circuit Court of Cook County; the Hon. FRANCIS T. DELANEY, Judge, presiding.

MR. JUSTICE DOWNING DELIVERED THE OPINION OF THE COURT:

This is a case brought by the Attorney General of Illinois to enforce the terms of a charitable trust under the Illinois Charitable Trust Act (Act) (Ill. Rev. Stat. 1969, ch. 14, pars. 51 through 64). The trial court granted defendants' motion to strike and dismiss the complaint for failure to state a claim upon which relief may be granted (Ill. Rev. Stat. 1971, ch. 110, par. 45). The Attorney General appeals from the dismissal of the complaint. Defendants have filed a cross-appeal from that portion of the trial court's order which upheld the constitutionality of the Act. The issues on appeal are whether defendants are "trustees" within the meaning of the Act, and whether the Act is constitutional.

The portions of the Act relevant to these appeals provide as follows:

"§ 2. This Act applies to any trustee, as defined in Section 3, holding property of a value in excess of $4,000.

§ 3. `Trustee' means any individual, group of individuals, corporation or other legal entity holding property for any charitable purpose.

§ 4. This Act does not apply to the United States, any State, territory or possession of the United States, the District of Columbia, the Commonwealth of Puerto Rico, or to any of their agencies or to any governmental subdivision; or to a corporation sole, or other religious corporation, trust or organization which holds property for religious, charitable, hospital or educational purposes or for the purpose of operating cemeteries or a home or homes for the aged; nor to any agency or organization, incorporated or unincorporated, affiliated with and directly supervised by such a religious corporation or organization; or to an officer, director or trustee of any such religious corporation, trust or organization who holds property in his official capacity for like purposes; or to a charitable organization foundation, trust or corporation organized for the purpose of and engaged in the operation of schools or hospitals, or for the purpose of operating a cemetery or cemeteries or a home or homes for the aged."

The Attorney General's complaint, filed February 2, 1972, was in two counts. Count I sought an order from the court that defendants comply with the provisions of sections 6 and 7 of the Act (Ill. Rev. Stat. 1969, ch. 14, pars. 56, 57, *fn1 for the costs of the action, and further appropriate relief. In substance, count I alleged that: The action was brought pursuant to the Charitable Trust Act and under the common law powers of attorneys general to enforce the terms of charitable trusts. The individual defendants are the directors of the corporate defendant. The purposes of the George F. Harding Museum, the successor to the George F. Harding Collection, Inc., incorporated on September 30, 1930, are set forth in its articles of incorporation as:

"[F]or the accumulation and dissemination of knowledge and the perpetuation of knowledge of ancient arts and sciences, for the improvement of the mind by the collection, preservation and exhibition of ancient and authentic objects illustrating art, science, and history, painting, sculpture, armor, weapons, objects of art and other objects and antiques bringing to the mind activities of mankind of earlier periods of time; to found, build, maintain and operate a museum for the exhibition of the collection; to receive gifts, donations and endowments and to receive in trust property of all kinds and to exercise all necessary powers as aforesaid for such trust estates where the purpose of the trust is for the furtherance of the above objects only."

George F. Harding provided additional funding for the collection in his last will and testament admitted to probate on April 6, 1939.

Originally, the George F. Harding Museum was located at 4853 S. Lake Park Avenue in Chicago, and was open to the public. In January of 1965, the collection was moved to 84-86 E. Randolph. After relocating, the museum ceased to be open to the public. Since that time, it is alleged, the collection has not been used to promote the purposes set forth in the articles of incorporation. Count I further alleged that the corporate defendant is a "trustee" within the meaning of the Act, as a legal entity holding property for charitable purposes, and that defendants have failed to comply with the Act.

Count II prayed for an order temporarily restraining defendants from making any disbursement, payment, or disposition of the assets of the corporate defendant; for an accounting; for an order that the individual defendants pay to the corporate defendant any sums found owing as a result of the accounting; and, that the individual defendants be removed as corporate directors. Alternatively, count II prayed for dissolution of the corporate defendant, for distribution of the corporation's assets pursuant to the doctrine of cy pres, and for such further relief deemed appropriate by the court.

Defendant's answer denied the material allegations of the complaint and raised the following as affirmative defenses: that the complaint failed to state a claim for relief; that the Charitable Trust Act did not apply to the Geroge F. Harding Museum, Inc.; that the Attorney General lacked authority to bring the action; and that the Act is unconstitutional. Defendants prayed for dismissal of the complaint and costs.

Subsequently, defendants filed a motion to strike and dismiss the complaint, alleging that the Act did not apply to the Harding Museum because it did not hold property for a charitable purpose, and that the Act is unconstitutional because it creates arbitrary and discriminatory classifications for coverage.

On April 14, 1976, the trial court granted defendants' motion. The order contained general findings that the Act is constitutional, and that the Attorney General lacked authority to bring the action because ...


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