Missouri and Hillsdale College in legal fight over bequest

July 21, 2019 GMT

COLUMBIA, Mo. (AP) — A small Michigan college with well-known conservative supporters is suing the University of Missouri over a multi-million bequest designed to promote an economic theory that espouses free markets and argues the government’s only role should be to defend people and property.

Hillsdale College is a conservative liberal arts college in southern Michigan, with about 1,500 students. The college calls itself a “nonsectarian Christian Institution” and takes no state of federal funding, which allows it to avoid government mandates such as affirmative action or Title IX requirements.


The school attracts conservatives such as Vice President Mike Pence, who gave the commencement speech last year, and U.S. Education Secretary Betsy DeVos.

Hillsdale sued Missouri two years ago over a $5 million bequest from Sherlock Hibbs, who became a successful Wall Street financier after graduating from Missouri in 1926. He died in 2002.

The case has reached the Missouri Supreme Court, which ruled June 25 that the lawsuit would be heard in Boone County, home of the Missouri’s flagship campus in Columbia, The Columbia Missourian reports . Former Missouri Gov. Jay Nixon. Nixon, a Democrat, is representing Hillsdale in the lawsuit against the University of Missouri’s Board of Curators, which includes four curators who Nixon appointed.

According to court briefs, Hibbs’ will requires the university to use his bequest to create chairs and distinguished professorships for “dedicated and articulate” followers of the late economist Ludwig von Mises, whose free market philosophy is associated with the Austrian School of Economics and is especially popular with libertarians.

Under the will, Missouri’s Board of Curators is required to send a letter to Hillsdale every four years identifying the professors occupying the three chairs and three distinguished professorships created with the bequest at Missouri’s Truslake College of Business. If the board didn’t send the letter or a seat remains open for five years, the balance of the trust would be forfeited to Hillsdale.

Currently, there are four professors in positions endowed by Hibbs and two seats are unoccupied, according to Missouri spokesman Christian Basi, who showed the Missourian two letters from 2014 and 2018 in which the professors each attest they are disciples of the free and open market espoused by Mises.


Hillsdale College claims the business school hasn’t appointed professors to those positions who meet Hibbs’ criteria, instead providing “millions of dollars over 15 years to individuals who were not Austrian economists,” according to court records. As the secondary beneficiary of Hibbs’ bequest, Hillsdale argues it should receive the money.

Basi said the will did not require that Mises’ theories be included in the professors’ curriculums. He said Hibbs’ $5 million donation has grown to $9 million because of Missouri investments. Of that amount, $4 million has been spent on the chairs and distinguished professorships since 2002.

“We are very careful to follow our donors’ wishes explicitly whenever we do accept a gift,” Basi said. “It should be noted we don’t accept every gift that is provided to the university. If we are offered gifts that do not coincide with our mission or current priorities, we have declined to accept those gifts, although we are always very grateful to anyone who wants to donate to the university.”

Peter Herzog III, an attorney for Hillsdale, said college officials first became suspicious of Missouri’s use of the money in 2014.

“Mr. Hibbs named Hillsdale College not only to ensure that his gifts were used as described in his will, but also to take action if the intent of his gift was not fulfilled,” Herzog said in an email. “Hillsdale takes that obligation very seriously. Hillsdale College looks forward to thorough discovery into why the University of Missouri changed the terms of Mr. Hibbs’ gift.”

Hibbs’ also made bequests to Cottey College in Nevada, Missouri, the University of Kansas and Hillsdale.

Herzog said Hibbs’ $1.3 million gift to Hillsdale paid for a professor who followed the Austrian School of Economics. A nearly $800,000 gift from Hibbs created a chair for a Mises’ follower at Cottey College, said Sherri Taylor, vice president for institutional advancement. A $750,000 gift from Hibbs endowed the Harold Otto Distinguished Chair in Austrian Economics at the University of Kansas.


Information from: Columbia Missourian,