Remove Autry Board from Fiduciary Control of SWM

With the Autry supposedly pulling out of their planned Griffith Park expansion, the question now is about what they may try to do with the Southwest Museum site and collection. So far, all they have done is spin spin spin. But from what they have said so far regarding the Southwest, by the sound of John Gray's letter (see below) they plan on a basic dissociation of the Southwest as a unified entity.

Dissociating the Southwest would be a violation of the merger agreement between the two entities. Backing this assertion is a paper trail that can be followed in the Los Angeles City Clerk's council files archive from roughly 2001 through 2007. It remains to be seen whether the Los Angeles City Council, Jose Huizar, and the Friends of the Southwest Museum can muster enough to force the Autry to keep their word.

So the race is on. The Autry will be trying to make a buck on the Southwest before the City gets its act together. Given the typical speed at which the City does anything, the Autry stands to succeed. One way to stop this from happening is to force the Autry board to give up fiduciary control of the historic property and its inventory. It's been done before. From the NY Times....

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April 30, 2008
Montana Museum Board Breached Duty, Court Says

The Montana Supreme Court dismissed on Tuesday the board of the Charles M. Bair Family Museum in Martinsdale, Mont., saying it breached its fiduciary duties by closing the museum from 2002 to 2005. The court said the board had not spent enough money to give a good start to the museum — home to an eclectic collection of fine European antiques, valuable art works and priceless Indian artifacts. It ordered U.S. Bank, the trustee, to create a new board that has to meet within six months.

“As a result of the board’s failure to spend ‘whatever principal and income of the Charles M. Bair Family Trust that is necessary to improve and maintain the museum,’ the museum never received a fair opportunity to succeed; the museum was destined for failure rather than success,” the court wrote in its opinion, quoting the trust document. “The board’s ensuing breaches emanated from this initial failure.”

U.S. Bank had not seen the ruling and had no comment, said a spokesman, Steve Dale. It controlled four of the five seats on the trust’s board of advisers, which oversaw the museum.
The case has been widely watched in the nonprofit world and among state regulators of charities. The regulators are often responsible for interpreting and defending donors’ intentions long after their deaths and in the face of strong opposition from powerful boards. Thirteen states filed amicus briefs in support of the Montana attorney general.

“It’s great news,” said the attorney general, Mike McGrath. “The Montana Supreme Court said the board does not have unfettered discretion.”

The case was brought by a community group, the Friends of the Bair Museum, whose members were overjoyed. “The little guy won,” said Jamie Doggett, chairwoman of the group. “The court realized that this was Alberta’s first and foremost desire to have the museum in her home in Martinsdale in memory of her father.”

Alberta is Alberta M. Bair, the strong-willed, quirky heiress who favored red hats and vodka and established the trust that had financed the museum. She died in 1993, leaving the fortune her father had amassed in minerals, finance and sheep. The trust created on her death stated that it was her “cherished aim and foremost desire” to establish a museum in the Bair family house, where she and her sister, Marguerite, had gathered their collection. She directed the board to spend whatever necessary from the trust’s principal and interest to maintain the museum and buy property, if needed.

She also gave the board the option of closing the museum after five years. The board members said that attendance had declined, that the house was ill suited to be a museum and that it lacked adequate security and protection against fire as the collection was increasing in value. From 2002 to 2005, the value of just the art collection increased 40 percent, to $6.7 million. Some of the most valuable pieces were moved to other institutions at the board’s discretion, reducing the attraction, and the court did not order their return. Mr. McGrath said he expected an accord with the new board.

Ms. Doggett said reopening the museum would be a boon to the Martindale economy. “People stop and look at a museum,” she said. “Not just a display on the wall, but to go into someone’s home and see how they lived.”