In his new book, Abusing Donor Intent, Doug White reveals how complicated charitable transactions with donors and families can be, offering insight during this donation-heavy time of year.

As the season for philanthropic support hits its peak, donors might well be concerned about how their money will be used. While every organization is different, it may be instructive to take some lessons from the book, Abusing Donor Intent, the inside story of Robertson v. Princeton, in which readers are invited to look behind a charitable transaction, from 1961, to see what can go wrong.

From the book’s introduction: It was the largest one-time amount – $35 million – anyone had ever donated to benefit a university. Charles and Marie Robertson were specific about the way the money was to be used. It was intended to help Princeton’s Woodrow Wilson School for Public Policy and International Affairs focus on sending its graduates into those areas of the federal government concerned with international relations. “But the university,” the son says, “was ignoring my parents’ intentions.” Furthermore, he maintains, Princeton’s administrators were “harming the country as well.”

The children of the donors filed the lawsuit. Bill Robertson, one of the sons, was the lead plaintiff.

The idea of honoring a donor’s intentions is not new, but in recent years it has gained momentum in the public, regulatory and legal spheres. Although that momentum is still scarcely more than an uneven patchwork of laws and sentiment, charities are wise not to ignore their donors’ wishes. This is true for all manner of gift: if a charity says the money will be used for a specific purpose, it had better honor the commitment.

In the Princeton case, part of the problem was a difference of opinion about whether the donors’ instructions were being followed. Princeton did not see the issue the same way the son did.

Again, from the book’s introduction: The people there say they not only assiduously honor the concept of donor intent for all its supporters, but that in this case they were particularly faithful to the donors’ intentions. “Princeton,” a top administrator once said, “ has always used the funds given by Marie Robertson solely for the purpose for which she made her $35 million gift in 1961.” The university contends that the Woodrow Wilson School has been and continues to be one of the best in the country for public administration and policy with an international orientation, and that it was unfairly disparaged.

By the time the lawsuit was filed in 2002, the corpus of the gift had grown to almost $700 million, a sizable portion of Princeton’s endowment. In addition to the sum of money at stake and the audacious, public challenge to a pillar of the most academically revered group of universities in the country, another, more important reason the world took note – and why all donors and all nonprofit organizations should never forget what happened – is that this dispute, at its heart, sharply raised the awareness of the need for trust and honor in the sector of our society that most demands and depends upon those qualities. Princeton officials claim they fulfilled their obligations. The Robertson family claims Princeton made a mockery of them. No matter what the defendants might say, Robertson insists he wasn’t the bad guy; he was just trying to protect the family’s honor.

The settlement, which was reached after six and a half years of arduous litigation and the exchange of much bad blood, called for Princeton to pay approximately $100 million dollars – $50 million to establish a new foundation that would be run by the family, and the rest to reimburse the Robertsons for their legal fees.

The story is compelling. As one reviewer has said, “Informed by the slow burn of a decades-old frustration, not to mention the disposition of hundreds of millions of dollars and the reputation of one of America’s oldest and most respected universities, Abusing Donor Intent is equal parts thriller and cautionary tale.”

The cautionary tale, however, is not only for the wealthy. It is for all donors. Even though money, once donated, is owned by the charity – and the IRS is clear about that – the charity still must act responsibly and respectfully. Everyone who supports a charitable organization has the right to know how his or her money is spent. When it accepts a gift based on a donor’s expectations, the charity, through formal reports and written correspondence, must live up to its word. As the British poet and historian Thomas Babington Macaulay once said, “The proof of virtue is to possess boundless power without using it.”

If nothing else, the nation’s charities are uniquely created to serve society as beacons of virtue.