There is a fascinating filing against the University of Missouri this month. Hillsdale College has filed a lawsuit against Mizzou for violating the agreement that it had with 1926 Mizzou graduate Sherlock Hibbs. The filing is a novel arrangement with Hibbs that not only stipulates the academic views of appointed faculty but gives the default (and incentive for monitoring) to a rivaling academic institution. For Mizzou, the lawsuit is the latest controversy over its political leanings, though this is a more academic dispute over economic theory. While admissions appear to have risen at Mizzou (though numbers remain overall down), a controversy over gifts could not come at a worse time.
As an academic, I am uncomfortable with gifts that specify intellectual positions or values of the faculty. I would not have signed on to this language of being an adherent as opposed to academics who teach the underlying theories and materials. Donors often complain about a bait-and-switch on legacy agreements where their wishes are eventually ignored. In 2002, Mizzou was delighted to receive a $5 million legacy from Hibbs, who wanted to fund six professor positions at the Trulaske College of Business for free market economics academics.
Here is how the brief describes the grant:
“Sherlock Hibbs was an adherent of the Ludwig von Mises (Austrian) School of Economics. The Austrian School emphasizes free markets, private property, and limited government, and differs in significant respects from Keynesian and other schools of economic thought. In 2002, Mr. Hibbs, a 1926 graduate of MU, donated $5,000,000 to fund three Chairs and three Distinguished Professorships at MU’s Trulaske College of Business (“TCB”). The Hibbs Will required that the bequest be divided into six separate funds. This included three separate sums of $1,100,000 to be used to establish and fund (1) a Chair of Money, Credit and Banking, (2) a Chair of Business and Economics, and (3) a Chair of Entrepreneurship, and three additional amounts ($567,000, $567,000, and $566,000) to establish and fund three Distinguished Professorships. (Id. at Ex. A, page 4, ¶ 9.) The Will also required that each appointee to a Chair and Distinguished Professorship be a dedicated and articulate disciple of theLudwig von Mises Austrian School of Economics.”
What is interesting is that Hibbs inserted a novel provision that stipulated that, if Mizzou violated its agreement, Hillsdale College would get the remaining funds. It also allowed Hillsdale to monitor the compliance with the agreement.
Now Hillsdale is demanding the money under the forfeiture provisions. It is citing the Dean’s own statement against his institution’s interest:
“Rather than decline the bequest or comply with its specific conditions, however, the Dean of the TCB appointed individuals to the Chairs and Distinguished Professorships whom he knew were not Austrian economists, much less “dedicated and articulate disciples” of the Ludwig von Mises. Indeed, in the Dean’s own words, “the Austrian School of Economics is quite controversial. We didn’t want to wade into that controversy, so we focused on some Austrian tenets that are compatible with what we do in our business school.” MU has never appointed a dedicated and articulate disciple of the Ludwig von Mises (Austrian) School of Economics to a Chair or Distinguished Professorship funded by Mr. Hibbs’ gift. Instead, MU provided millions of dollars over 15 years to individuals who were not Austrian economists. In doing so, MU violated the terms of contracts that established the Chairs and Distinguished Professorships, and Hillsdale seeks to recover damages as the third-party beneficiary of those contracts.”
It is rare to see a university stipulate academic viewpoints as a condition for a legacy gift. The incentive given to Hillsdale also is novel and clearly successful in guaranteeing the monitoring of the university. If successful, this could be a model used by others to demand a commitment in the appointment of academics from a particularly ideological or intellectual school of thought.