 |
 |
 |
 |
 |
 |
Welcome Message from the President
|
How Creative Financing Helped
When Stan Beattie, chairman of the Board of Law Examiners, wrote his encouraging letter to me in 1971, he mentioned that Villanova University had recently started a law school and, using their experience as an example, he advised that all I needed was a good faculty and two million dollars.
I assumed that finding a good faculty wouldn't be a problem; the two million was somewhat beyond my means. I had stopped in to see my friend Bob Fisher at the Michigan National Bank, gave him $50, and opened a bank account in the name of Cooley Law School. I told Bob that if the school never got incorporated, whatever was left in that account would go to the Detroit College of Law.
In due course, Hugh Ross, a lawyer friend from Detroit, sent me $500, and Dick McCormack, general counsel for Whirlpool in Berrien County, engineered a corporate contribution of $1,000. That $1,550 was all we had until application fees began to come in.
Beattie's two million was just a goal, and not a requirement. Unfortunately, in 1971, the statute authorizing the formation of educational corporations provided that a university level charter required an initial capitalization of one million dollars. Since we intended to award law degrees, we needed a university charter. The committee of scholars wanted to know if I had a million dollars.
That sent me to the law library. I discovered that the same statute which required the million dollars of capitalization, also provided that the State Board of Education could adopt an administrative rule establishing a ratio by which expected income would satisfy the capitalization requirement. A little further digging turned up the fact that the Board had in fact adopted such a rule. The ratio was 33 to 1.
Now, I figured, we are making progress. The 33 to 1 ratio meant that if I could show that the school would have at least $30,000 in income, the million dollar capitalization requirement would be satisfied.
Since we already had in hand inquiries from nearly three hundred prospective students, it was no stretch to assert that we would have well in excess of $30,000 of annual income. Just when I thought we had cleared that hurdle, the committee did some research of its own and came up with a further administrative rule which specified that at least half of the first year's income must be in hand.
Admittedly, we had come a long way from a million dollars to fifteen thousand. Still, the fifteen thousand might as well have been a million. I didn't have it. I had only $1,550.
Undaunted, I called Bud Stoddard at the Michigan National Bank. I told him I needed fifteen thousand dollars to start a law school. "No problem," said Bud, and he issued a letter of credit for the money.
The committee reluctantly accepted the letter of credit. Still, its final report recommended against issuance of the charter. Their principal reservation was the conviction that the school would not be able to survive and meet the criteria for approval by the American Bar Association. They conceded that if we did the things that we were proposing to do, we would have a legitimate school of law. They just didn't believe that it could happen. They didn't think it would fly.
I thought otherwise. I wrote a strongly worded letter to the State Board of Education demanding that they disregard the recommendation of the committee and approve the issuance of our charter. I pointed out that many members of the committee were burdened with a conflict of interest, in that they were representatives of competing law schools. I emphasized that the risk of failure was upon the incorporators of the school; that the Board had no right to deny us the opportunity to try.
The deliberations of the State Board of Education were hotly contested. The Attorney General had been asked to opine about the sufficiency of our capitalization. Gene Krasicky, a long time Assistant Attorney General, came to our defense. Still the Board was divided. State Board of Education meetings are public. I slipped into the back of the room. Thomas J. Brennan, a Democratic member of the Board, a friend, but no kin of mine, spotted me lurking there. He rose from his chair, headed toward the door and gave me a turn of the head to suggest that I follow him out to the hall. I did.
Tom cautioned me not to stay. He was pretty sure that the final vote would be favorable, but he felt that my being there would make some members of the Board uncomfortable. I took his advice and went home.
The vote was not unanimous, but the Board approved our charter. Its resolution was somewhat ambiguous, however, in that they provided that the law school would not be permitted to grant diplomas unless and until its actual operations were inspected by a committee and approved by the Board.
The corporate charter for the Thomas M. Cooley Law School was issued on June 19, 1972. Not many people thought it would succeed. My wife, Polly, had told me she thought it was a good idea. That was enough for me.
Admissions | Financial Aid | Academics | Grand Rapids Campus | Rochester/Oakland Campus
Library | Bookstore | Information Technology | Clinical | Career Services
Faculty | Students | Alumni | News & Events | Overview | Search Cooley | Contact Us
This Page was last updated on:
08/19/2004