Douglas v. Middlebury College

7ermont Superior Court
Filed 10/03/2.
Addison Bint

VERMONT SUPERIOR COURT CIVIL DIVISION
Addison Unit Case No. 23-CV-01214
7 Mahady Court

Middlebury VT 05753
802-388-7741
www.vermontjudiciary.org

Hon. James H. Douglas, Special Administrator of the Estate ofJohn Abner Mead v. The President and
Fellows of Middlebury College

Ruling on Middlebury's Motion for Summary Judgment
and Renewed Motion to Dismiss

In 1914, former Vermont Governor John Mead offered to give Middlebury College
the financial resources to construct a chapel on its campus. Middlebury accepted, and
the chapel, named the Mead Memorial Chapel, was completed within 2 years. He died in
1920, and his estate was promptly probated and closed. In 2021, Middlebury determined
to remove the Mead name from the chapel and removed the signage so describing it. The
Rutland Probate Division, on petition, then reopened Governor Mead's estate and
appointed former Vermont Governor James Douglas its special administrator for the
purpose of bringing this lawsuit. Here, Governor Douglas challenges Middlebury's
decision to remove of the Mead name from the chapel. Governor Douglas claims that, in
changing the chapel's name, Middlebury breached a term in an alleged contract between
Governor Mead and Middlebury or, in the alternative, it breached a condition-subsequent
burdening Governor Mead's gift to Middlebury to the effect that the chapel would be
known perpetually as the Mead Memorial Chapel. He also claims that Middlebury
breached the covenant of good faith and fair dealing inherent in the original contract or
is liable for unjust enrichment.

In its August 4, 2023, decision denying Middlebury's motion to dismiss, the court
rejected Middlebury's argument that Governor Douglas necessarily lacks "standing" to
prosecute this action. It then concluded that it could not determine based on the
allegations of the complaint alone whether the 1914 transaction sounds in contract or
property (gift) law. The court summarized the law as to perpetual contract terms and
conditions-subsequent binding gifts both highly disfavored under the law but made no
final determinations as to those matters under Rule 12(b)(6), preferring to let the
evidence develop first.

After document discovery was complete, Middlebury filed a motion for summary
judgment and a renewed motion to dismiss for lack of standing.! It argues as follows: (1)
Governor Mead's contribution in support of the chapel was a gift rather than a contract;
(2) there is no perpetual naming condition-subsequent attached to that gift, and if there

1
Depositions, which would not be anticipated to reflect on the issues addressed in this decision, are
conditionally stayed under the court's July 23, 2024, order.
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23-CV-01214 Hon. James H. Douglas, Special Administrator of the Estate ofJohn Abner Mead v. The President and Fellows
of Middlebury College
were, it is not enforceable by Governor Douglas because no reversionary right was
retained by Governor Mead; (3) separately, Governor Douglas lacks “standing” to raise
any rights related to the gift because such claims can only be prosecuted by Vermont’s
Attorney General; (4) even if the transaction is construed to be a contract, the evidence
falls short of demonstrating that there is any naming condition running to perpetuity; (5)
because there is no contract, there can be no breach of the covenant of good faith and fair
dealing; and (6) the circumstances of this case cannot support an unjust enrichment
claim.

The court notes that, excepting Middlebury’s objection to the court’s analysis of
donor-standing law, the parties assert now no disagreement with the court’s description
of the law in the dismissal decision, which the court adopts for purposes of this decision.
But for donor-standing, there is no fundamental disagreement as to the applicable legal
principles. The controversy is how the law properly applies to the circumstances of this
case.

Procedural standard

Summary judgment procedure is “an integral part of the . . . Rules as a whole,
which are designed ‘to secure the just, speedy and inexpensive determination of every
action.’” Morrisseau v. Fayette, 164 Vt. 358, 363 (1995) (quoting Celotex Corp. v. Catrett,
477 U.S. 317, 327 (1986)). Summary judgment is appropriate if the evidence in the
record, referred to in the statements required by Rule 56(c), shows that there is no
genuine issue as to any material fact and that the movant is entitled to judgment as a
matter of law. V.R.C.P. 56(a); Gallipo v. City of Rutland, 163 Vt. 83, 86 (1994) (summary
judgment will be granted if, after adequate time for discovery, a party fails to make a
showing sufficient to establish an essential element of the case on which the party will
bear the burden of proof at trial). The court derives the undisputed facts from the
parties’ statements of fact and the supporting documents. Boulton v. CLD Consulting
Engineers, Inc., 2003 VT 72, ¶ 29, 175 Vt. 413. A party opposing summary judgment
may not simply rely on allegations in the pleadings to establish a genuine issue of
material fact. Instead, it must come forward with deposition excerpts, affidavits, or other
evidence to establish such a dispute. Murray v. White, 155 Vt. 621, 628 (1991).
Speculation is insufficient. Palmer v. Furlan, 2019 VT 42, ¶ 10, 210 Vt. 375.

The Facts

The parties take issue with certain of each other’s characterizations of facts, and
they draw different inferences, but the record is purely documentary, historical, and
undisputed in all material respects. The parties, Governor Douglas in particular, have
set forth the narrative at length. The court summarizes here.

John Abner Mead (1841–1920) was a physician, businessman, politician, and
philanthropist who served as Vermont’s Lieutenant Governor from 1908 to 1910 and as
Vermont’s Governor from 1910 to 1912. He graduated with the Class of 1864 from
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23-CV-01214 Hon. James H. Douglas, Special Administrator of the Estate of John Abner Mead v. The President and Fellows
of Middlebury College
Middlebury College, which was chartered in 1800. In 1914, he determined to give
Middlebury the funds to construct a campus chapel. Accordingly, on May 11, 1914, he
sent the following letter (the 1914 Letter) to Middlebury’s President, the Rev. Dr. John
M. Thomas:

My Dear President Thomas:-

In commemoration of the 50th anniversary of my graduation from
Middlebury College, and in recognition of the gracious kindness of my
heavenly father to me throughout my life, I desire to erect a chapel to serve
as a place of worship for the college, the same to be known as the “Mead
Memorial Chapel.” I have in mind a dignified and substantial structure, in
harmony with the other buildings of the college, and expressive of the
simplicity and strength of character for which the inhabitants of this valley
and the State of Vermont have always been distinguished.

It was my great-great-grandfather, the first white settler of this
valley, who brought the first copy of the Holy Bible into this unbroken
wilderness and it was his wife, my great-great-grandmother, who gathered
her large family about her in an indian wigwam for the first christian
service of the Vermont pioneers of this immediate region.

With this memory ever present, it has been my hope and prayer that
I might be able and permitted to build for this college a suitable place for
divine worship and that it might rise from the highest point on its campus
as a symbol of the position, most prominent in every respect, which
Christian character and religious faith should always maintain in its work
for our youth.

I have in mind the furnishing of from $50,000 to $60,000 for the
erection of such a structure, and I hereby suggest that the Trustees of the
College secure appropriate plans for its erection which shall meet with my
approval, and that said board appoint a building committee at once,
consisting of president Thomas, former President Brainerd and myself to
make the necessary contracts for such a structure and to supervise the
erection of the same, and I will then bind myself and my estate to provide
the necessary means for its erection and completion in accordance with the
suggestions of this letter and with the contracts to be made by your
committee.

President Thomas sent a copy of the 1914 Letter to the Trustees of Middlebury College
requesting replies “as to whether you will authorize the acceptance of Governor Mead’s
proposition and the appointment of the Building Committee which he suggests.” The
Trustees responded enthusiastically with approval.

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23-CV-01214 Hon. James H. Douglas, Special Administrator of the Estate of John Abner Mead v. The President and Fellows
of Middlebury College
On June 22, 1914, the Board of Trustees met and resolved as follows:

The following resolution, introduced by Dr. Brainerd, on motion of Dr.
Barton & Prof. Kellogg, was adopted by a rising vote:-

Whereas our esteemed colleague, the Honorable John Abner Mead of
the Class of 1864, has signified to President Thomas his desire, in
commemoration of the fiftieth anniversary of his graduation, to erect a
Chapel for Middlebury College, and his readiness to furnish the sum of
from fifty thousand to sixty thousand dollars for the erection of such an
edifice,

Resolved that the President and Fellows of Middlebury College
hereby accept of this magnificent benefaction with sincere gratitude to
both Dr. & Mrs. Mead and their family for their deep interest in the
religious welfare of the College, so impressively manifested by this
provision of a suitable place for divine worship.

Resolved that the Trustees through the Committee nominated
by Dr. Mead will use their best endeavors to secure the erection of a
dignified and substantial structure, in harmony with the other buildings
of the college, and such as will meet the approval of the donor.”

Dr. Mead made fitting response to this resolution. His letter of
presentation follows in full:-

[A copy of the 1914 Letter then appears here, but it is
unnecessary to repeat at length and is omitted.]

On motion of Mr. Partridge, seconded by Dr. Abernathy, the Building
Committee for the Mead Chapel was elected as above, Messrs. Thomas,
Brainerd, Mead and Weeks.

Mr. Collins of the architectural firm of Allen & Collins then appeared
before the Board with tentative plans for the new Chapel, which were
discussed at length.

A groundbreaking ceremony was held on June 23, 1914. In his remarks, Governor
Mead said:

On this date, I wish to break the ground and place the corner stone
for this Memorial Chapel, with the hope and prayer that there shall be a
sacred duty resting upon each, to make this Holy Temple, so soon to be
erected, an instrument of great good to those of this generation and to those
who may follow after.
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23-CV-01214 Hon. James H. Douglas, Special Administrator of the Estate of John Abner Mead v. The President and Fellows
of Middlebury College
The Rev. James Barton then delivered the Acceptance in Behalf of the Trustees, which
included this:

It is doubly gratifying to me, as it is to the Board of Trustees, that
this building, as a memorial, will bear the name of one so long and so
honorably connected with this institution and who in the state and nation
has always upheld and promoted true piety and civic and national
righteousness.

This chapel will provide for the generations of students and faculties
of this college that to which the other buildings cannot minister. To this
place all will turn in order to experience the reality of the unseen, to satisfy
the thirst of the soul for God.

We then, the Trustees of this College, on behalf of ourselves and our
successors, in the name of the generations of students it will serve, in full
recognition of the supreme importance of such a religious center to the life
of the institution, and in loving memory of him whose name this structure is
to bear, gratefully accept at your hand this Chapel as we pledge ourselves to
safeguard to the limit of our capacity the gift and the ideals it is intended to
perpetuate.

Professor Charles Wright then gave an Address in Behalf of the Faculty, which included
this:

The Faculty thank you, Governor Mead, from profoundly grateful
hearts. You have bodied forth our dream of years; you have given to an airy
nothing a local habitation—and not the least of our pleasure is the thought
that through all the days to be it will bear your honored name.

By December 1914, the ensuing planning had made clear that the expense of
construction would exceed $60,000, the high end of the originally contemplated range.
Middlebury agreed to complete construction if Governor Mead would contribute the full
$60,000. Governor Mead in January 1915 agreed:

In consideration of the contract of the Committee for the Erection of
the Mead Memorial Chapel at Middlebury College with Thomas W. Rogers
of Brandon, Vt., whereby the same is to be erected in accordance with plans
and specifications of Allen & Collens, architects, at a cost of $51,945, I agree
to furnish funds for the discharge of this contract and for the expenses
connected with the erection of this chapel, to the amount of $60,000, as may
be required during the construction and in accordance with the terms of the
above contract, binding myself, my heirs and my assigns as above specified.
It is agreed on the part of said Trustees that they are to complete said
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23-CV-01214 Hon. James H. Douglas, Special Administrator of the Estate of John Abner Mead v. The President and Fellows
of Middlebury College
chapel, making it complete in every way, as to grounds, furnishings, etc., for
the purposes of a college chapel, as voted at the meeting of the Trustees of
said college held in New York City Dec. 18, 1914, and as defined in
correspondence between the president of Middlebury College and myself.

By April 1915, Governor Mead had committed another $1,031 for certain windows
and pilasters, and Middlebury had agreed to contribute another $5,000 for a pipe organ.
In June 1915, Governor Mead agreed to contribute an additional $6,960 for a “chime of
bells.” Governor Mead eventually approved the final architectural plans, all reflecting
that the chapel would bear the Mead Memorial Chapel name. While construction was
underway, Governor Mead attended the Building Committee’s meetings, met with
architects, approved project designs, controlled the budget, and paid labor and materials
expenses.

Construction of the Mead Memorial Chapel was complete in 1916. Governor Mead
died in 1920. From inception to present, the chapel has been an important place on
campus “where the College community comes together on occasions of significance.”

In this history, Governor Douglas sees a contract between Governor Mead and
Middlebury with a term requiring that the chapel remain named the Mead Memorial
Chapel into perpetuity. Middlebury instead sees a gift from a generous benefactor not
burdened by any such condition, much less a perpetual one.

Was it a gift or a contract?

Determining whether Governor Mead’s contribution of funds for the construction
of the chapel was a gift to or contract with Middlebury is to determine whether the
claimed naming condition is properly analyzed under those property law concepts
applicable to gifts or contract law. The court declined to resolve that issue at the
dismissal stage, noting that the distinction is potentially subtle and would be better
addressed on a developed factual record.

The parties have not disagreed with the applicable law as summarized in the
dismissal decision, which the court briefly summarizes. “To be a gift, a transfer must be
made with donative intent. The requirement of donative intent is the essence of a gift.”
Restatement (Third) of Property (Wills & Don. Trans.) § 6.1 cmt. b. “Donative intent is to
be distinguished from donative motive. The motive for making a gift is a complex matter
and does not determine whether or not a gift was intended. The relevant criterion is
intent to transfer an ownership interest gratuitously, as opposed to engaging in an
exchange transaction or making an involuntary transfer.” Id. “[A] gift is not ordinarily
treated as a bargain, and a promise to make a gift is not made a bargain by the promise
of the prospective donee to accept the gift, or by his acceptance of part of it. This may be
true even though the terms of gift impose a burden on the donee as well as the donor. In
such cases the distinction between bargain and gift may be a fine one, depending on the
motives manifested by the parties.” Restatement (Second) of Contracts § 71 cmt. c
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23-CV-01214 Hon. James H. Douglas, Special Administrator of the Estate of John Abner Mead v. The President and Fellows
of Middlebury College
(emphasis added); see also id. § 24 cmt. b (“[P]roposal of a gift is not an offer within the
present definition [of offer]; there must be an element of exchange. Whether or not a
proposal is a promise, it is not an offer unless it specifies a promise or performance by the
offeree as the price or consideration to be given by him. It is not enough that there is a
promise performable on a certain contingency.”).

Middlebury argues that the undisputed facts can support one inference only: that
the transaction was a gift as a matter of law: Governor Mead’s intentions were donative
in nature, even if he imposed conditions precedent, and even if he contemplated a specific
name for the chapel. Governor Douglas sees in those conditions the sort of bargained-for
consideration that instead points in favor of a contract with an enduring condition.

As the Restatement (Second) of Contracts § 71 cmt. c says, the distinction the
parties are asking the court draw can be “a fine one.” The court does not believe the
record is so one-sided as Middlebury does and declines to rule as a matter of law. The
issue must be determined on the evidence at trial.

If it was a gift, is there an enforceable naming condition?

If it is assumed for present purposes that the transaction was a gift, and that the
gift was burdened by some condition-subsequent as to the name of the chapel, the
question then turns to whether the condition could be enforceable in a case such as this.
See Wilbur v. University of Vt., 129 Vt. 33, 43 (1970) (“Beyond that, we do not interpret
the restriction as imposing a true condition subsequent. Such a construction is
disfavored.”); President & Fellows of Middlebury Coll. v. Cent. Power Corp. of Vt., 143 A.
384, 390 (Vt. 1928) (“Furthermore, conditions subsequent are not favored in the law, and
if the language of an instrument can be otherwise construed, without violating the plain
intent of the maker thereof, it will be done.”).

Generally, to work a forfeiture in the donee, the donor must have clearly retained
a right of forfeiture or reverter. See Wilbur, 129 Vt. at 44 (“The absence of any provision
for forfeiture or reverter is a strong indication that the donor did not contemplate a
failure of the ultimate purpose of his gift.”); Restatement (Second) of Property, Don.
Trans. § 31.2; Iris J. Goodwin, Donor Standing to Enforce Charitable Gifts: Civil Society
v. Donor Empowerment, 58 Vand. L. Rev. 1093, 1145 (2005) (“[N]early all the modern
American authorities—decisions, model acts, statutes, and commentaries—deny a donor
standing to enforce a restricted gift to [a] public charity absent express retention of a
reversion in the donative instrument.”).

The record reveals no such reversionary right retained by Governor Mead. In
opposition to summary judgment, Governor Douglas argues at page 51 as follows:

In the case at bar, if the court determines that there was no
consideration, the gift was delivered and accepted by the donee. However,
there were conditions on the gift which have now been breached. Removing
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23-CV-01214 Hon. James H. Douglas, Special Administrator of the Estate of John Abner Mead v. The President and Fellows
of Middlebury College
the Mead sign violated Mead’s approval of the plans and specification of the
Chapel as well as the condition that the chapel “be known as” “Mead
Memorial Chapel.” The stripping of the name was a canceling of the
College’s performance of an essential condition of the gift. Whether the
obligation was undone or never performed, the result is the same, the donor
is entitled to restitution.

But he nowhere points to any evidence in the record documenting Governor Mead’s
retention of any reversionary rights triggered by such circumstances. Without any such
right having been reserved, even if there were some condition placed on a gift of funds for
construction purposes, it would be unenforceable in the manner urged by Governor
Douglas in this case.

Middlebury thus is entitled to judgment as a matter of law to the effect that if the
transaction is determined to have been a gift, any naming condition attached to that gift
is not enforceable in this case. It is unnecessary to further resolve Middlebury’s donor-
standing argument vis-à-vis the attorney general’s exclusive authority.

If it was a contract, is there a perpetual naming condition?

If it is assumed for present purposes that the transaction was a contract, the
question turns to whether that contract includes a term requiring that the chapel retain
the name Mead Memorial Chapel into perpetuity. As the court explained in the
dismissal decision, perpetual terms in contracts are disfavored and must be shown with
adamant clarity—ambiguity will be construed against perpetuity. See Ruling on
Middlebury’s Motion to Dismiss at 5–6 (filed Aug. 4, 2023); McDonald v. Scitec, Inc., 79
A.3d 374, 379 (Me. 2013) (“‘Forever’ is a long time.” (citation omitted)).

The record reveals no naming term with perpetual duration. Governor Douglas
argues at pages 36–37 of his opposition filing as follows:

It is the trust that Mead had with his fellow trustees and their shared
understanding that a promise to name a building as a memorial to honor
and remember ancestors, was a promise forever. Moreover, this was a
religious chapel that was to memorialize the Mead ancestors who embodied
and symbolized the “simplicity and character of the inhabitants” of the area
and the removal of the Mead name is a breach of a sacred promise that was
made through the prayers and dedications offered to the Mead Memorial
Chapel and Governor Mead.

And we can suppose it is that trust, that prevented the insertion of
some sort of language such as “in perpetuity” with regard to the name Mead
Memorial Chapel. However, there is no evidence to suggest that “in
perpetuity” language was even being used at that time and place in history.
Therefore, we have absolutely no evidence to suggest that it would have
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23-CV-01214 Hon. James H. Douglas, Special Administrator of the Estate of John Abner Mead v. The President and Fellows
of Middlebury College
ever occurred to the parties, to specify that a name in quotation marks with
the verbiage “the same to be known as”, would have only temporary effect
for some finite time period. A name is a name is a name.

And then at 42 he says this:

The 2021 removal of Mead family name from the Mead Memorial
Chapel was a breach of the contract’s most essential term, the consideration
expected by and bargained for by John Abner Mead, that the chapel he was
erecting for the college would be a memorial to his ancestors, bearing his
family name forever. Given the evidentiary record already assembled, could
any reasonable person actually believe that the Trustees did not agree to
name the chapel the “Mead Memorial Chapel” or that Mead would have
built the chapel if his term or condition were denied?

In other words, there is no direct evidence of any such perpetual requirement, and
Governor Douglas instead would have the court infer that such a requirement was
intended by the parties based on the general circumstances of the transaction. The
standard, however, is rigorous, and the evidence as extensively assembled by Governor
Douglas does not satisfy it.

Nor can the matter be settled rhetorically by the hypothetical question as to what
would have happened if Middlebury in 1914 responded to Governor Mead’s offer by
saying yes to the money but no to the name. Obviously, Governor Mead and Middlebury
both contemplated at the time that the chapel as built would be named the Mead
Memorial Chapel, and it in fact was. It is likely the case that neither contemplated in
1914 that Middlebury ever would be interested to switch course and change the name
many generations later. But the legal question is whether there is adamantly clear
evidence in the record of a naming condition running to perpetuity that binds
Middlebury. The evidence is insufficient. There is no such perpetual condition.2

Assuming it was a contract, was there any naming condition at all?

Middlebury’s argument that there was no naming condition whatsoever, however,
is not persuasive. Here, Governor’s Douglas’s thought experiment is compelling. The
record is express that both parties intended that the chapel would be named the Mead
Memorial Chapel. There is no evidence of any negotiated duration attached to that
name. However, the court has no doubt that if Middlebury had resisted placing the
Mead name on the chapel at the time of the offer that the offer would have been
retracted. That the chapel would be named the Mead Memorial Chapel was a condition
to the offer. That so naming the as-built structure would satisfy that condition, as
though Middlebury was free immediately thereafter the change the name, strains

2 Governor Douglas’s speculation that the terms perpetual or perpetuity may not have been in common use

in the early 1900s for these purposes is not the point. The question is not whether this or that special word
was used but whether any words were clearly used to impose a durational term extending forever.
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credulity.

Generally, “[w]hen the parties to a bargain sufficiently defined to be a contract
have not agreed with respect to a term which is essential to a determination of their
rights and duties, a term which is reasonable in the circumstances is supplied by the
court.” Restatement (Second) of Contracts § 204; Gade v. Chittenden Solid Waste Dist.,
2009 VT 107, ¶ 26 n.7, 187 Vt. 7 (“General principles of contract law . . . add further
support for the implication of a reasonable time limit in a contract where no time limit is
provided. When a contract lacks a term essential to its performance, the court may
supply a reasonable term, based on the subject matter of the contract.”).

No doubt, Governor Douglas’s view is that a reasonable time is as long as the
chapel is standing. But that is no different than imposing the perpetual durational term
that the law disfavors, that the evidence does not support, and that maximizes the
chance of a forfeiture.

The parties have not identified, and the court has not unearthed, any case in
which a contract between a private person and a charity for the construction of a building
that is burdened with a naming condition that lacks a durational term, and the court is
left to say what length is reasonable. The most instructive case cited in the briefing and
that the court has found is St. Mary’s Medical Center, Inc. v. McCarthy, 829 N.E.2d 1068
(Ind. Ct. App. 2005). In that case, the terms of Ms. Cornelia Haney’s will directed
substantial funds to a bank in trust for the establishment of the Haney Memorial at St.
Mary’s Medical Center. Ms. Haney died shortly thereafter, and trust funds were used to
construct a chapel at the hospital. Approximately 50 years later, the hospital determined
that its expansion plans required demolition of the chapel. Daniel McCarthy, a distant
relative of Ms. Haney, filed suit to enjoin the demolition. For appeal purposes, the Court
assumed without deciding that Mr. McCarthy had standing to bring suit. Id. at 1072.

The Court first determined that the will did not contemplate the creation of a
charitable trust. It then explained that the argument in support of a charitable trust
amounted in the alternative to a claim of a defeasible condition-subsequent to the gift.
Id. at 1075 (“That is, he seems to contend that the devise is revocable should St. Mary’s
want to destroy the chapel at any time before it collapses of its own accord after an
indeterminate period of use.”). From there, the Court analyzes the disfavored nature of
conditions-subsequent and the reasonable duration of any such condition that lacks an
express durational provision. The decision is worth quoting at length:

Here, given the disfavor of conditions subsequent and the absence of
clear reverter language or the required length of any Haney Memorial
created by Haney’s estate, the most that can be said of her devise to St.
Mary’s through her trust committee was that she and the committee
expressed confidence in St. Mary’s that it would “use the property so far as
may be reasonable and practicable to effect the purpose of the grant.”
Indeed, the Chapel of Mary, Queen apparently was an integral part of St.
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23-CV-01214 Hon. James H. Douglas, Special Administrator of the Estate of John Abner Mead v. The President and Fellows
of Middlebury College
Mary’s for nearly fifty years, until such time as the hospital’s governance
decided that it was no longer practicable for the chapel to remain and, in
fact, was an impediment to expansion of the hospital. We will not second-
guess the reasonableness of St. Mary’s determination on this point. We also
note that although charitable gifts should be encouraged so far as possible,
charities themselves should not be bound to one particular use of
bequeathed property for multiple generations unless they are on clear notice
that such is a requirement of the bequest. [Fn. 4]

[Fn. 4] There was evidence presented here that the Chapel of Mary,
Queen could stand for another fifty to seventy-five years, if not longer.
McCarthy essentially asserts that St. Mary’s must allow the chapel to
stand for at least that long; the wording of the trial court’s order also
would seem to require St. Mary’s to do nothing that might hasten the
chapel’s demise and that it would have to wait until the chapel
crumbled of its own accord before it could put the property on which it
stands to another use. We decline to so hold in the absence of clear
evidence that St. Mary’s knew it was irrevocably tying up a substantial
piece of its grounds for at least 100 to 125 years when it agreed to use
the funds from Haney’s estate to build the chapel.

In any event, there are Indiana cases suggesting that St. Mary’s use
of the chapel for nearly fifty years constituted substantial compliance with
any charitable trust or condition subsequent imposed by Haney’s will. For
example, in [one case], the court considered the effect of a donation of real
estate to a township with the condition that it be used for school purposes.
The opinion holds that even if this represented a valid condition subsequent,
which the court doubted, the township substantially complied with the
condition by using the property for school purposes for thirty years and that
it could then sell the property. . . . [In another case . . .,] the decedent
bequeathed $2,000 and real estate to his brother, which pursuant to the will
the brother promised to use to build a library and hall for the benefit of a
church organization. Apparently, the brother died twenty years after the
library and hall were built and his heirs sought to recover the property over
the objections of the church organization. This court first expressed
skepticism that the brother was intended to hold the property in trust for
the church organization. We went on to hold that even if there had been a
trust, “the purposes of the bequest were fully carried out by the erection of
this building of which plaintiffs had the use and benefit for nearly 20 years,
and it does not appear that they are still entitled to its use and benefit. . . .

. . . . [E]ven if there was a charitable trust or valid condition
subsequent, St. Mary’s use of the chapel for nearly fifty years represents
substantial compliance with any such trust or condition.

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23-CV-01214 Hon. James H. Douglas, Special Administrator of the Estate of John Abner Mead v. The President and Fellows
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Id. at 1076–1077 (citations omitted, emphasis added).

In short, at issue in St. Mary’s was not merely the use of a memorial chapel but
the very existence of it. The Court clearly determined that, even if there were a
condition-subsequent binding the gift that paid for the chapel’s construction, that
condition was clearly satisfied by the passage of around 50 years, and the Court would
“not second-guess the reasonableness” of the hospital’s judgment as to demolition of the
chapel.

By contrast, the use of the chapel in this case is not at issue, only its name, and
the chapel retained its original name for well over 100 years, and approximately 100
years after Governor Mead’s own death. Governor Mead contributed most of the funds
supporting the initial construction of the chapel, but he did not provide funds for its
indefinite maintenance, and Middlebury has determined that the time has come to
change the name. In these circumstances, the court concludes that the reasonable
duration of any contractual term as to the name of the chapel has been satisfied as a
matter of law.

Governor Douglas’s breach of contract claim fails as a matter of law.

Breach of the covenant of good faith and fair dealing

Assuming the transaction was a contract, Governor Douglas’s claim based on the
covenant of good faith and fair dealing remains in the case. The Vermont Supreme Court
has described the implied covenant as follows:

The covenant of good faith and fair dealing is implied in every
contract; its boundaries, however, are contextual and fact-specific. It is an
implied promise that protects against conduct which violates community
standards of “‘decency, fairness or reasonableness.’” “A cause of action for
breach of the covenant of good faith can arise only upon a showing that
there is an underlying contractual relationship between the parties. . . .” A
breach for violation of the implied covenant may form a separate cause of
action than for breach of contract, as long as the counts are based on
different conduct.

Harsch Properties, Inc. v. Nicholas, 2007 VT 70, ¶ 14, 182 Vt. 196 (citations omitted).
The court understands Governor Douglas’s claim to address not the chapel’s name-
change per se but the manner by which Middlebury undertook it. In Governor Douglas’s
view, Middlebury unjustly tarnished Governor Mead’s reputational interests in violation
of the covenant.

Middlebury argues that there can be no viable claim predicated on the covenant
insofar as there is no contract in which any such covenant is implied. As the court has
not determined whether the transaction in this case was a gift or a contract, the court
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23-CV-01214 Hon. James H. Douglas, Special Administrator of the Estate of John Abner Mead v. The President and Fellows
of Middlebury College
cannot rule on that issue at this time. Otherwise, Middlebury has not sought judgment
on the substance of the claim.

Unjust Enrichment

Middlebury argues that Mr. Douglas’s unjust enrichment claim fails as a matter of
law based on the circumstances of this case. Governor Douglas did not respond to that
argument in his opposition filing. The court construes Governor Douglas’s silence as a
waiver and consent to judgment in Middlebury’s favor on this claim.

In any event, the claim has no merit. In the complaint, Governor Douglas
describes this claim as follows: “Under these facts and circumstances, it is unjust for the
Defendant to strip the Mead Memorial Chapel of the Mead Family name, canceling the
incredible accomplishments and altruism of a true philanthrope and important figure in
Vermont history, all while retaining the many benefits that the Mead Memorial Chapel
has provided to every student who has attended Middlebury College for the last century
and will to the next, without commensurate compensation.”

As a general matter, “Unjust enrichment is present only if: ‘(1) a benefit was
conferred on defendant; (2) defendant accepted the benefit; and (3) defendant retained
the benefit under such circumstances that it would be inequitable for defendant not to
compensate plaintiff for its value.’” Kellogg v. Shushereba, 2013 VT 76, ¶ 31, 194 Vt. 446
(citation omitted).

As in most cases, the first two elements usually are satisfied: a benefit was
conferred on Middlebury, and Middlebury accepted it. The real question is the equitable
one as to whether Middlebury should retain the benefit. But Mr. Douglas nowhere
explains why it would be inequitable for Middlebury to retain the benefit in the
circumstances of this case. As the Restatement explains, “Unjustified enrichment is
enrichment that lacks an adequate legal basis; it results from a transaction that the law
treats as ineffective to work a conclusive alteration in ownership rights. Broadly
speaking, an ineffective transaction for these purposes is one that is nonconsensual.”
Restatement (Third) of Restitution and Unjust Enrichment § 1 cmt. b.

Whatever the proper characterization of the underlying transaction, Governor
Douglas’s unjust enrichment theory does not fit the facts. If there was a contract, there
can be no claim for unjust enrichment. See id. § 2 (“A valid contract defines the
obligations of the parties as to matters within its scope, displacing to that extent any
inquiry into unjust enrichment.”). “Unjust enrichment . . . does not apply when the
conferred benefit was a gift or voluntary payment.” Roberts v. Smith, 801 S.E.2d 915,
921 (Ga. Ct. App. 2017).

Summary and Related Matters

Accordingly, the court is unable to determine at this time whether the underlying
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23-CV-01214 Hon. James H. Douglas, Special Administrator of the Estate of John Abner Mead v. The President and Fellows
of Middlebury College
transaction was a gift or a contract. Either way, Governor Douglas, on behalf of the
Estate, would not be entitled to relief compelling Middlebury to retain the chapel’s
original name or monetary relief compensating the name change. The unjust enrichment
claim has no merit. Because the transaction still could be determined to be a contract,
the court cannot determine as a matter of law that there can be no claim on the covenant
of good faith and fair dealing.

There thus remain two issues in this case to be resolved at trial: (1) is the
transaction a gift or contract; and (2) if a contract, has Middlebury breached the covenant
of good faith and fair dealing, the only claim remaining that could give rise to a remedy
and, if so, what damages, if any, is the plaintiff entitled to recover.

Regarding further proceedings, the court understands that the evidence material
to the first issue, though requiring a finding of fact, is essentially the same as described
in this decision. Evidence material to the second issue, on the other hand, can be
expected to explore deeply emotional and politicized matters, all of which will have been
unnecessary to reach if the determination on the first issue is that the transaction was a
gift and thus there can be no covenant claim. For that reason, any trial in this case will
be bifurcated so that the first issue may be resolved before evidence necessary to the
second may be presented. See V.R.C.P. 42(b).

Regarding the covenant claim, the briefing of both the dismissal and summary
judgment motions has only summarily touched on the substance of the claim.3 Because
the court has determined that Middlebury is entitled to summary judgment on the
breach of contract claim, contract damages will not be available in this case, even if the
court ultimately determines that the parties intended a contract rather than a gift. Tort
damages, however, are available to a party who proves a breach of the covenant of good
faith and fair dealing. See Monahan v. GMAC Mort. Corp., 2005 VT 110, ¶ 54 n. 5, 179
Vt. 167 (“cause of action for the breach of the implied covenant of good faith and fair
dealing is one sounding in tort”); Carmichael v. Adirondack Bottled Gas Corp. of
Vermont, 161 Vt. 200, 208 (1993) (“an action for [breach of the covenant of good faith and
fair dealing] is really no different from a tort action”); but see Harsch Properties, Inc. v.
Nicholas, 2007 VT 70, ¶ 17, 182 Vt. 196 (“Although claims for breach of the implied
covenant take on many qualities of a tort action, these claims are not fully and
exclusively torts.”). Relevant examples might include damages for emotional distress or
for harm to one’s reputation. The court notes, however, that Governor Mead has been
deceased for over a century and could not have been emotionally harmed by Middlebury’s
decision to remove the Mead name from the chapel. The court needs to know, therefore,
what damages Governor Douglas claims to be entitled to recover in this case if he
prevails on the breach of the covenant of good faith and fair dealing claim. The court will
give Governor Douglas 30 days to file a brief listing the kinds of damages he intends to
seek to recover and explaining the legal basis supporting the entitlement to recover such
damages here. The court will give Middlebury 30 days to respond.

3 Certain discovery bearing on the covenant claim is stayed at this point. See supra n.1 at 1.
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23-CV-01214 Hon. James H. Douglas, Special Administrator of the Estate of John Abner Mead v. The President and Fellows
of Middlebury College
Order

For the foregoing reasons: (1) Middlebury’s motion for summary judgment is
granted in part and denied in part; (2) Middlebury’s renewed motion to dismiss is denied
as moot; (3) the parties shall submit further briefing as set forth above; and (4)
depositions will remain stayed under the July 23, 2024, order pending further order of
the court.

SO ORDERED this 3rd day of October, 2024

_____________________
Robert A. Mello
Superior Judge

Order Page 15 of 15
23-CV-01214 Hon. James H. Douglas, Special Administrator of the Estate of John Abner Mead v. The President and Fellows
of Middlebury College