Nonprofits should always respect the intent of donors, as a recently settled lawsuit involving Princeton University makes clear. In 2002, the heirs of Marie Robertson sued Princeton, alleging that the university had failed to use Ms. Robertson’s $35 million gift as she had instructed it be used. Ms. Robertson, an heir to the A&P grocery fortune, had made the donation to Princeton in 1961 for the Woodrow Wilson School of Public and International Affairs to prepare students for government careers in international affairs. The Robertson family claimed that Princeton had ignored the instruction that came with the gift to prepare students for careers in government.
Yesterday, in what is believed to be the biggest settlement yet in a donor intent case, Princeton agreed to pay $50 million for the establishment of a new foundation dedicated to preparing students for government careers in international affairs. In addition, Princeton will pay $40 million in legal fees incurred by the Robertson family. The balance of the funds from the Robertson Foundation, estimated at $700 million, will be transferred to Princeton to continue funding the Woodrow Wilson School of Public and International Affairs.
William Robertson, lead plaintiff and son of Marie Robertson, said: “This settlement is more than a slap on the wrist. This is a message to nonprofit organizations of all kinds and throughout our country that donors expect them to abide by the terms of designated gifts or suffer the consequences.”