Paperwork in Terry Mansion lawsuit relate museum foundation’s wish to be rid of obligation

Documents in Terry Mansion lawsuit relate museum foundation's wish to be rid of obligation

Richard H. Mays, an lawyer throughout the lawsuit in opposition to city of Little Rock and the Arkansas Museum of Excellent Arts and its Foundation over the deterioration of the historic Terry Mansion has been amended in order so as to add particulars about money raised to help the ability as an outlet for the humanities.

WARREN STEPHENS: He talked about the museum foundation needs to complete all help of Terry Mansion on the end of June.

It moreover outlines communications from financier Warren Stephens, chair of the muse board, of the museum’s want to clean its arms of any obligations for the property and end even minimal help by July 1. Mayor Frank Scott Jr. was aware of this, nonetheless relations weren’t educated of this, the amended grievance says.

The Arts Center Foundation has sought dismissal of the lawsuit for failure to sufficiently allege that donations to the muse had been for an endowment.

Mays’  amended grievance comprises paperwork that time out donations to the house had been for an endowment.

Proper right here’s the amended lawsuit.

Owners of the home, Adolphine Fletcher Terry and her sister, Mary Fletcher Drennan,  deeded it to city in 1964 for the eventual use of what was then typically known as the Arkansas Arts Center. The property transferred in 1977 and the Arts Center lastly began using the developing as a center for decorative arts and as well as leased it for explicit events. The lawsuit says the Museum Board created an endowment for eternal funding in 1984 and raised money for maintenance and operations. The Winthrop Rockefeller Perception contributed $1 million as an similar grant for the endowment. A 1984 Arts Center data launch launched the grant for an “endowment, which is ready to current working revenue.” The grievance moreover references mentions of an endowment in Rockefeller Perception communications in regards to the grant. The Arts Center foundation then solicited contributions with a sort that talked about, partially:

I pledge my help to the Arkansas Arts Center Foundation throughout the amount of $_________ to provide a eternal endowment for the Decorative Arts Museum.

The Arts Center Foundation, in looking for favorable tax treatment of contributions, wrote in a letter to the IRS:

The AACF [Arkansas Arts Center Foundation] must create an endowment fund the earnings from which is perhaps used for the daily operations of the House, … and utilities and maintenance. The Trustees of the Winthrop Rockefeller Charitable Perception have authorised a two-for-one matching grant of endowment funds as a lot as $1,000,000.
Accordingly, a potential endowment fund of $1,500,000 may be raised.

Although the AACF has gathered an endowment fund for features of supporting the Arts Center, that endowment cannot help every the operations of the Arts Center and the House. Thus, to have the flexibility to carry out the wants of the House, an additional endowment fund is important.

The amended grievance comprises totally different communications by the Arts Center along with a 1986-87 annual report that referred to the “endowment drive.”

It moreover includes a 2003 letter from then-museum director Ellen Plummer that references the $1.8 million endowment for the house (separate from a much bigger Rockefeller reward to the Arts Center itself).

She wrote:

I do admire the aim that this doc makes; that there is a long-standing, deep dedication to the Arts Center normally and the Terry House particularly on the part of the Rockefeller family, the Terry family and positively the group as a whole. Our intent is to honor that heritage.

Mays argues that money could very properly be used only for house operations, not totally different Arts Center features. And he questions whether or not or not rental receipts for the ability went to take care of maintenance, as a result of the deed specified.  The decorative arts center was closed in 2003 and the property has deteriorated. Family members launched the swimsuit to strain city and humanities center to ship on commitments to care for the property. City talked about it’s joyful to take motion if the humanities center produces some money.

Mays’ swimsuit says:

The Foundation obtained the Endowment funds as a fiduciary trustee, and as such was and is accountable for the prudent funding, administration and use of the funds for his or her meant features. Under related regulation and accounting concepts referring to expenditure of Endowment funds, and in view of donations of money and firms to the Pike-Fletcher-Terry Property from sources apart from the Endowment (e.g., donations by the State of Arkansas, the Metropolis of Little Rock, and totally different sources), the Endowment for the Property should be in existence with an enormous stability. The Arkansas Arts Center/Museum Foundation should be required to account for the funding, expenditure, and use of the Endowment funds.

The humanities center needs to clean its arms of the property. Mays’ submitting says:

On June 24, 2021, representatives of the Terry-Drennan Family met with representatives of the Museum and the Foundation referring to the long term use of the Property by the Museum. They’d been suggested by Mr. Warren Stephens, Chairman of the Foundation’s Board of Directors, that he had, quite a few months earlier, directed the Foundation’s lawyer to draft a letter to the Metropolis of Little Rock stating that the Foundation not had an curiosity throughout the Property, and would relinquish it. On the request of the Mayor of the Metropolis of Little Rock, who acknowledged that verbal uncover was sufficient, the letter was not despatched. That information had not theretofore been conveyed to any particular person in or representing the Terry-Drennan Family.


Mr. Stephens extra confirmed to the representatives of the Terry-Drennan Family that the Foundation would not make investments any extra cash into the Property, apart from price of utilities on the house until June 30, 2022, the highest of the Foundation’s fiscal 12 months.


As an alternative, Mr. Stephens acknowledged that the Foundation Board has a fiduciary obligation to guard the funds raised throughout the capital advertising marketing campaign throughout which the Foundation is at current engaged, ignoring the reality that The Foundation moreover has a fiduciary obligation to guard the Endowment Fund that was raised for the Pike-Fletcher-Terry Property.


Stephens’ reported statements seem significantly at variance with a defensive assertion issued currently by the muse which talked about: “As a company, the [museum] stays devoted to working with the Metropolis to hunt a optimistic remaining end result for the preservation of the Terry House.”

The lawsuit complains the museum and foundation, at any time after discontinuing use of the property, may need restored it at a lower worth and educated city and plaintiffs that it had no plans for the house. As an alternative, the museum and foundation retained administration of the property with out using it or appropriately sustaining it.

The swimsuit says heirs of the households had repeatedly inquired in regards to the museum’s intentions.

The Heirs on a regular basis obtained assurances that the Museum and the Foundation thought-about the Property to be needed and useful to the Museum and the Foundation.

It was not until June 25, 2021, that representatives of the Museum and/or the Foundation prompt heirs of Adolphine Fletcher Terry and Mary Fletcher Drennan that the Museum and Foundation had no extra curiosity in or use for the Property, and would not make investments any money in sustaining the Property.

The lawsuit is pending sooner than Select Alice Gray. An accounting of spending of the money contributed to the house seems the minimal obligation owed by a recipient of a whole lot of hundreds in public tax money and charitable contributions. Staffing of the house may have eaten up the money and help could not have been sufficient to take care of the ensures made in accepting accountability for the house and taking money for it. In that case, let the proof be confirmed.

Provide on ensures by a charitable institution could have an effect on future gadgets. On this case, the group looking for to cease the Terry Mansion enterprise, the museum and its foundation, is amid fund-raising for rebuilding and enlargement of the core museum helped by tens of a whole lot of hundreds in public tax {{dollars}}.

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