This is a follow-up to my “Uniform ‘Imprudent’ Management of Institutional Funds Act” (UPMIFA) that appeared in the June 11, 2009, New York Law Journal. In that article, I expressed the opinion that S4778 and A7907 continue an unfortunate trend to shield further charitable fiduciaries from liability for their reinvestment decisions. These bills would also impair donors’ rights by apparently limiting application of the Appellate Division, First Department’s landmark decision in Smithers v. St. Luke’s-Roosevelt Hospital Center, 281 A.D.2d 127, 723 N.Y.S.2d 426 (2001).

Assembly bill 7907 is now in a C or fourth print. Proposed Not-for-Profit Corporation Law (NPCL) §551(a-1) now contains a significant definition of “donor” that applies throughout proposed NPCL Article 5-A instead only to part of it:

(a-1) “Donor” means the person who grants or transfers property to an institution pursuant to a gift instrument, or a person designated in the applicable gift instrument to act in the place of the donor, but does not otherwise include the person’s executors, heirs, successors, assigns, transferees, or distributees.

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