Cornell University vs. New York Chapter of Phi Kappa Psi Association

Timothy M. Burke, Fraternal Law Partners, tburke@manleyburke.com

Members of Phi Kappa Psi were part of the first graduating class at Cornell University in 1869, and for the next century and a half, the University and the Fraternity maintained a beneficial symbiotic relationship. But the consequences of an October 24, 2019, dirty rush party at the Phi Kappa Psi chapter house and the death of Antonio Tsialas, who fell to his death in the Fall Creek Gorge while apparently on his way back to his dormitory from the party, brought that relationship to an end. 

The N.Y. Alpha Chapter of Phi Kappa Psi Association, Inc.,[1] and the University are now locked in litigation over the long-time Phi Kappa Psi chapter house known as “The Gables.” The suit filed by the Association on December 14th has five causes of action: breach of contract, breach of terms of gift, breach of duty of good faith and fair dealing, promissory estoppel, and loss of personal property.[2]

The Complaint that initiated the litigation carefully tracks the history of Phi Kappa Psi at Cornell and concentrates on a series of agreements that relate to the construction of the chapter house by the Fraternity.[3] These were entered into between the late 1950’s and the mid 1960’s, all of which ultimately resulted in the construction of The Gables and its dedication at the Cornell Homecoming in October 1998.

 Of critical importance is a page-and-a-half long Agreement between Cornell and the Association. That Agreement recognized that the Association had sold its prior chapter house property to the University at a discounted price, that it did so at the request of the University to support the Cornell University Residence Plan of 1958 to provide for a greater number of participating fraternities, and contained the following critical language, as quoted in the Complaint:

That the occupancy and possession of the University-owned facilities at 525 Stewart Avenue shall be in perpetuity upon good behavior of the priority group [the Association], and if upon the suspension or termination of said Priority Group, the Group House No. 4, being the facilities at 525 Stewart Avenue and its curtilage, shall be reserved for reorganization of the same Priority Group by the Group Sponsor here contracted with.

(Emphasis in original.)

According to the Complaint, as a part of a settlement related to Antonio Tsialas’s death, in September of 2020 “the University’s current administration took the unprecedented step of purporting to permanently revoke the recognition of Phi Kappa Psi.”  Arguing that “the meaning of ‘in perpetuity’ needs no elaboration” and that “the meaning of ‘reserved’ is equally clear and unambiguous,” the Complaint highlights its claim that Cornell violated the Association’s legal rights.

In response, the Association, attempting to exercise its rights in perpetuity to the property, proposed to lease The Gables to Cornell’s veteran student population working with the Cornell Military Network and the Cornell Undergraduate Veteran’s Association. The University refused to cooperate in that effort and instead placed the Cornell University Veteran’s Association in a “vastly inferior, privately owned house.” As the Complaint indicates, the University did so “because it had previously made a foolhardy promise to another fraternity. . .that it could take the possession of The Gables.”

Just last month, the University ordered Phi Kappa Psi to remove all its personal property from The Gables.  The members of the Fraternity had paid to build, renovate, and maintain The Gables to the total tune of over ten million dollars at “present-value,” according to the Complaint.

Obviously, the litigation is in its very early state, but even now there are at least two lessons to be learned.  One is that the consequences of alcohol abuse, whether involving hazing or not, can result in the host institution taking drastic action to punish, not necessarily the bad actors who engaged in the misconduct, but the property owner that had nothing to do with the wrong-doing and only sought to maintain a home for future members of the Fraternity. Second, in entering into an  agreement with a university to provide for the construction of housing that would be paid for by the fraternity and its members, critical care needs to be provided to ensure the protection of the fraternity’s investment.   How successful Phi Kappa Psi was in doing that more than a half century ago will now be determined in court.

[1] The Association is referred to in the litigation, and in some of the documents on which the litigation is based, as “Group Sponsor.”

[2] New York Alpha of Phi Kappa Psi Association, Inc. v. Cornell University is pending in the Supreme Court of the State of New York for the County of Tompkins.

[3] Edward Y. Crossmore, Esq., of Ithaca, New York filed the litigation on behalf of the Association.