First Merit Bank, N.A. v. Akron General Medical Center

Kathryn Seymour established a trust. Under the trust agreement’s terms, when Seymour died, certain trust property was to be distributed to her daughter, and the remainder was to be distributed in designated proportions to a local church, the local salvation army, and Massillon Community Hospital (the hospital). When Seymour established the trust, the hospital was a not-for-profit entity. However, it was subsequently sold to a for-profit entity and became known as the Affinity Medical Center (Affinity) (defendant). Upon Seymour’s death, the trustee, First Merit Bank (Merit) (plaintiff), filed an action in the probate court, seeking a declaration that (1) Seymour’s trust was a charitable trust and (2) because her charitable intent toward the hospital could not be fulfilled, the court should apply the cy pres doctrine to modify the trust so that the relevant funds were paid to a different charitable entity. Affinity argued that it was still entitled to the funds, claiming that application of the cy pres doctrine would be inappropriate because the trust language did not exhibit a general charitable intent. The Greater Health Foundation of Massillon (foundation) and the Greater Massillon Rotary Foundation (rotary) interfered, asserting an interest in the trust property. The probate court held that Affinity was not entitled to the trust property and applied the cy pres doctrine to instead order the property’s distribution to the foundation and the rotary. Affinity appealed.