Abstract

Despite the school‘s storied past and deep historical roots, on March 3, 2015, the Sweet Briar Board of Directors announced its intention to shut down the college—permanently—the following summer. The Board cited "insurmountable financial challenges," including falling enrollment, a lack of unrestricted funds in its endowment, and the century-old school‘s lack of appeal to modern generations of students. The Board claimed the school was no longer financially viable, because though its $84 million endowment was sizeable by most measures, the school needed an endowment three times that size to stay open. Students, faculty, staff, and alumnae were blindsided by the news that their college would abruptly shut its doors. Unanswered questions led to controversy and distrust, and groups of Sweet Briar supporters were galvanized to take action. Immediately following the announcement, a movement to halt the school‘s closure arose and quickly gained momentum, leading to a hotly contested legal battle that went from the circuit court to the Supreme Court of Virginia and back again. Amherst County Attorney, Ellen Bowyer, boldly brought the principal lawsuit in the name of the Commonwealth of Virginia. The lawsuit alleged the College had violated the Virginia Charitable Solicitations Act by using charitable funds, raised to operate the school, for the purpose of closing it instead. The lawsuit also claimed violations of the Virginia Uniform Trust Code. In the end, the supporters of Sweet Briar won. This is their story.

Part I provides an in-depth factual overview, beginning with the college‘s founding in the early 1900s. The commentary then turns to the controversial decision to close and discusses the facts and legal theories of the case, the decisions by the circuit court and the Supreme Court of Virginia, and the eventual settlement that kept the school alive. In Part II, the discussion shifts to the landmark nature of this case, not only for Sweet Briar College, but also for other Virginia colleges and non-profits around the country. The essay analyzes the legal questions arising from the case, including whether a Virginia corporation could also be a trustee, and, what were the Board‘s legal obligations in this case?

Document Type

Article

Publication Date

2016

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