COMPENDIUM Book 3 The Deed

America’s Cup Compendium Including Herbert Pell, Citizen’s, Louis Vuitton and Prada Cups

The Deed Book 3 The Historical Record of the Races to America’s Cup

MARK ROBINSON HOLLAND with jack griffin

America's Cup [Ə-mer-Ə-kƏ’s ‘kƏp] NOUN DEFINITION an international yachting race for a perpetual challenge cup originally won by the yacht AMERICA in a race around the Isle of Wight at the Royal Yacht Squadron’s 1851 regatta, and now held every three to four years.

compendium [kəmˈpendēəm] NOUN DEFINITION a collection of concise but detailed information about a particular subject, especially in a book or other publication.

Book 3 The Deeds Published 2024 by COMPENDIUM PUBLISHING LLC Mark Robinson Holland Version 1.0 Original Upload 24 FEBRUARY 2024

Copyright © 2023. Applicable content providers’ copyrights reserved. America’s Cup Compendium is a research work identifying the persons, places, yachts and events that contributed to the history of the Races for America’s Cup, including the evolution of the applicable rules of sailing and/or yacht design or criteria that applied at the time of any cited race or regatta, all for the purpose of historically documenting the sport.

ISBN All rights reserved. No part of this publication may be reproduced in any form or by any means – graphic, electronic or mechanical, including photocopying , recording, taping or information storage and retrieval systems – without the prior permission of the publishers.

TEXT: Mark Robinson Holland Jack Griffin Karolina Stefanski, PhD. ILLUSTRATIONS: Mark Robinson Holland COVER: Library of Congress, (1901) Walter, Fredrick A., 1877-1966. Columbia and Shamrock.

America’s Cup Compendium

Including Herbert C. Pell, Citizen’s, Louis Vuitton and Prada Cups

The Deeds America’s Cup Compendium

Including the Herbert C. Pell, Citizen’s, Louis Vuitton and Prada Cups

Contents

INTRODUCTION .................................................................................................................................................................................5 ORIGINAL DEED OF GIFT (MAY 15, 1852, REDATED JULY 8, 1857) ...................................................................................................5 THE SECOND DEED OF GIFT (FEBRUARY 2, 1882)............................................................................................................................7 AMENDED DEED OF GIFT (OCTOBER 24, 1887)...............................................................................................................................8 WATERLINE LENGTH AND OWN BOTTOM AMENDMENTS BY NEW YORK SUPREME COURT ORDER WITH RESPECT TO ADMINISTRATION OF GIFT (DECEMBER 17, 1956)..........................................................................................................................9 ARM OF THE SEA INTERPRETATION (SEPTEMBER 20, 1984) ......................................................................................................... 10 SOUTHERN HEMISPHERE AMENDMENT PER ORDER OF THE SUPREME COURT OF THE STATE OF NEW YORK (APRIL 5, 1985) ..... 10 CURRENT DEED OF GIFT (APRIL 8, 1985) (INTERLINEATED TO SHOW CHANGES) .......................................................................... 11 THE REGATTAE CONDUCTED UNDER THE AMENDED DEED ......................................................................................................... 12 RECORD OF COURT CHALLENGES UNDER THE DEED OF GIFT ........................................................................................................... 15 CASE 1: MERCURY BAY BOATING CLUB VS SAN DIEGO YACHT CLUB {**12 NY3D AT 252} CLUB (76 NY2D 256 [1990] AND ITS APPEAL {76 N.Y. 2D 256, 557 N.E.2D 87,557 N.Y.S. 2D 851 (1990)}................................................................................................ 15 CASE 2: GOLDEN GATE YACHT VS. SOCIETE NAUTIQUE DE GENEVE 2008 N.Y. SLIP OP. 30782 (N.Y. SUP. CT. 2008) ..................... 36 CASE 3: GOLDEN GATE YACHT VS. SOCIETE NAUTIQUE DE GENEVE 2008 N.Y. SLIP OP. 32296 (N.Y. SUP. CT. 2008) ..................... 39 CASE 4: GOLDEN GATE VS. SOCIÉTÉ NAUTIQUE DE GENÈVE 55 A.D.3D 26 (N.Y. APP. DIV. 2008) ................................................. 41 CASE 5: GOLDEN GATE YACHT CLUB VS. SOCIETE NAUTIQUE DE GENEVE ................................................................................... 44 CASE 6: GOLDEN GATE YACHT CLUB V. SOCIÉTÉ NAUTIQUE DE GENEVA 2009 N.Y. SLIP OP. 32163 (N.Y. SUP. CT. 2009) ............. 49 CASE 7: GOLDEN GATE YACHT CLUB V. SOCIÉTÉ NAUTIQUE DE GENEVE, 2009 NY SLIP OP 32572(U) (N.Y. SUP. CT. 10/30/2009) 2009 N.Y. SLIP OP. 32572 (N.Y. SUP. CT. 2009).............................................................................................................................. 52 CASE 8: GOLDEN GATE V. SOCIÉTÉ NAUTIQUE 68 A.D.3D 552 (N.Y. APP. DIV. 2009) .................................................................... 55 CASE 9: GOLDEN GATE YACHT CLUB V. GENÈVE 2007 N.Y. SLIP OP. 52496 (N.Y. SUP. CT. 2007) .................................................. 56 BRIEF OF AMICUS CURIAE NEW YORK YACHT CLUB (NY 602446/07) ............................................................................................ 63 CASE 10: GOLDEN GATE YACHT CLUB V. SOCIÉTÉ NAUTIQUE GENEVE 2009 N.Y. SLIP OP. 31722 (N.Y. SUP. CT. 2009) ................... 69 CASE 11: MERCURY BAY V. SAN DIEGO 76 N.Y.2D 256 (N.Y. 1990) .............................................................................................. 76 NEW YORK SUPREME COURT DECISION AND ORDER RE RAK VENUE OF THE 33RD AMERICA’S CUP – 27 OCTOBER 2009 ............. 95 SETTLEMENT AGREEMENT AND MUTUAL RELEASE (26 MARCH 2010) ......................................................................................... 97 CASE 13: JUDGMENT OF THE SUPREME COURT OF THE STATE OF NEW YORK DATED SEPTEMBER 20, 1984 ................................. 99 CASE 14: AFRICAN DIASPORA MAR. CORP. V. GOLDEN GATE YACHT CLUB 38 MISC. 3D 1214 (N.Y. SUP. CT. 2013) ...................... 100 CASE 15: AFRICAN DIASPORA MAR. CORP. V. GOLDEN GATE YACHT CLUB 109 A.D.3D 204 (N.Y. APP. DIV. 2013)........................ 107 INTERPRETIVE RESOLUTIONS TO THE DEED OF GIFT ADOPTED BY THE TRUSTEES ......................................................................... 116

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The Deed

America’s Cup Compendium

Including Herbert C. Pell, Citizen’s, Louis Vuitton and Prada Cups

RESOLUTION ADOPTED BY THE BOARD OF TRUSTEES ON MARCH 27, 1958 (THE "1958 RESOLUTION")..................................... 116 RESOLUTION ADOPTED BY THE BOARD OF TRUSTEES ON JULY 15, 1980 (THE "1980 RESOLUTIONS")........................................ 117 RESOLUTIONS ADOPTED BY THE AMERICA'S CUP COMMITTEE OF THE ROYAL PERTH YACHT CLUB ON MAY 15, 1984 - (THE "FIRST 1984 RESOLUTIONS") ...................................................................................................................................................... 118 RESOLUTIONS ADOPTED BY THE AMERICA'S CUP COMMITTEE OF THE ROYAL PERTH YACHT CLUB ON MAY 15, 1984 - (THE "SECOND 1984 RESOLUTIONS").................................................................................................................................................. 118 RESOLUTIONS ADOPTED BY THE AMERICA'S CUP COMMITTEE OF THE ROYAL PERTH YACHT CLUB ON MAY 22, 1984 - (THE "THIRD 1984 RESOLUTIONS") ..................................................................................................................................................... 119 RESOLUTIONS ADOPTED BY THE BOARD OF DIRECTORS OF THE SAN DIEGO YACHT CLUB ON AUGUST 19, 1988 - (THE "FIRST 1988 RESOLUTIONS") ................................................................................................................................................................. 119 RESOLUTIONS ADOPTED BY THE BOARD OF DIRECTORS OF THE SAN DIEGO YACHT CLUB ON AUGUST 19, 1988 - (THE "SECOND 1988 RESOLUTIONS") ................................................................................................................................................................. 120 RESOLUTION ADOPTED BY THE BOARD OF DIRECTORS OF THE SAN DIEGO YACHT CLUB ON JULY 1, 1990 - (THE "FIRST 1990 RESOLUTION") ........................................................................................................................................................................... 121 RESOLUTIONS ADOPTED BY THE BOARD OF DIRECTORS OF THE SAN DIEGO YACHT CLUB ON JULY 1, 1990 - (THE "SECOND 1990 RESOLUTIONS") ......................................................................................................................................................................... 121 THE INTERPRETIVE RESOLUTIONS ADOPTED BY THE TRUSTEES ................................................................................................. 123 RESOLUTIONS ADOPTED JULY 15, 1980 ..................................................................................................................................... 123 FOOTNOTES IN AMPLIFICATION OF THE JULY 15, 1980 RESOLUTIONS, INCLUDING THE AMENDMENTS OF MAY 15, 1984 AND JULY 1, 1990 .............................................................................................................................................................................. 124 RESOLUTIONS ADOPTED MAY 22, 1984 ..................................................................................................................................... 124 RESOLUTIONS ADOPTED JULY 1, 1990 ....................................................................................................................................... 124 RESOLUTION ADOPTED BY UNANIMOUS CONSENT OF THE BOARD OF DIRECTORS OF THE SAN DIEGO YACHT CLUB ON APRIL 9, 1993 - (THE "FIRST 1993 RESOLUTION") ..................................................................................................................................... 124 RESOLUTIONS ADOPTED BY THE FLAG OFFICERS AND GENERAL COMMITTEE OF THE ROYAL NEW ZEALAND YACHT SQUADRON ON DECEMBER 19, 1996 - (THE "1996 RESOLUTION")................................................................................................................. 125 RESOLUTION REGARDING A PROTOCOL GOVERNING THE THIRTY SECOND AMERICAS CUP (AMENDED JANUARY 21, 2004) .... 126 DECISION #1 MARCH 1, 1991..................................................................................................................................................... 127 DECISION #2 MARCH 3, 1991..................................................................................................................................................... 127 DECISION #3 MARCH 3, 1991..................................................................................................................................................... 128 DECISION #4 MARCH 4, 1991..................................................................................................................................................... 128 DECISION #5 OCTOBER 16, 1991 ................................................................................................................................................ 129 AMENDMENT TO ARTICLE 9 OF RESOLUTION REGARDING A PROTOCOL GOVERNING THE THIRTY SECOND AMERICAS CUP (JANUARY 21, 2004) ................................................................................................................................................................... 129 ASSIGNMENTS and ACCEPTANCE OF THE AMERICA’S CUP ............................................................................................................ 130 GEORGE L. SCHUYLER TO NEW YORK YACHT CLUB (JULY 8, 1857).............................................................................................. 130 NEW YORK YACHT CLUB’S INVITATION TO EIGHTEEN FOREIGN YACHT CLUBS (JULY 20, 1857) .................................................. 131 NEW YORK YACHT CLUB TO ROYAL PERTH YACHT CLUB (SEPTEMBER 27, 1983) ........................................................................ 132 ROYAL PERTH YACHT CLUB TO SAN DIEGO YACHT CLUB (FEBRUARY 5, 1987) ............................................................................ 133 SAN DIEGO YACHT CLUB TO ROYAL NEW ZEALAND YACHT SQUADRON (MAY 22, 1995) ........................................................... 134 ROYAL NEW ZEALAND YACHT SQUADRON TO SOCIETE NAUTIQUE DE GENEVE (MARCH 9, 2003) ............................................. 135

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SOCIETE NAUTIQUE DE GENEVE TO GOLDEN GATE YACHT CLUB (FEBRUARY 14, 2010)20 APRIL 2010........................................ 135 GOLDEN GATE YACHT CLUB TO ROYAL NEW ZEALAND YACHT SQUADRON (JUNE 26, 2017)...................................................... 135 OTHER DEEDS OF GIFT ................................................................................................................................................................... 136 DEED OF TRUST – KNICKERBOCKER YACHT CLUB CENTENNIAL TROPHY (1973) ........................................................................... 136 MEMORANDUM – LOAN RECEIPT – HERBERT C. PELL CUP .......................................................................................................... 136 DEED CONDITIONS - BRENTON REEF, CAPE MAY, GOELET AND ASTOR CUPS............................................................................... 137 Deed Conditions - Brenton Reef Cup ...................................................................................................................................... 137 Deed Conditions - Cape May Cup ........................................................................................................................................... 137 End Notes ...................................................................................................................................................................................... 139

INTRODUCTION The Deed of Gift was a document that accompanied the presentation of the Cup won by the yacht AMERICA on August 22, 1851, by the George Schuyler-led syndicate to the New York Yacht Club as a “perpetual Challenge Cup for the friendly competition between nations.”

This section of America’s Cup Compendium looks at the legal documents that control the conduct of America’s Cup competition.

Starting with the Original Deed of Gift, the early amendments, the later court-ordered changes and the various interpretations reached within the meaning of the Deeds, this section provides a comprehensive picture of the original desires of the donors – amended only where necessary to reflect the realities of life decades after the initial writings.

Included are records of the court cases brought when the parties could not reach an agreement within the terms of the Deed, where the Courts of the State of New York made the necessary interpretations as they read the Deed.

ORIGINAL DEED of GIFT (May 15, 1852, redated July 8, 1857) As a result of winning the fleet race at the Annual Regatta sailed on August 22, 1851 at the Isle of Wight in Cowes, England, the sponsor, The Royal Yacht Squadron, awarded the so-called “Queen’s £100 Cup.” (“The Cup”) (see The Cup chapter for more information). The winning syndicate consisted solely of the five (5) owners of the newly-launched American yacht AMERICA: George L. Schuyler, J. C. Stevens, Edwin A. Stevens, Hamilton Wilkes, and J. Beekman Finley.

The Cup remained in the possession of the five individuals, being moved from time-to-time from residence to residence, primarily as an object for conversation at parties. Reportedly, at one point, due to its size and design, its silver content was deemed more valuable than its trophy value, and a plan was to melt the Cup down and make five (5) silver medals from it.

Over the several years ensuing, both Mssrs. Stevens, Mr. Wilkes and Mr. Finley died, leaving The Cup in the sole possession of Mr. Schuyler who kept it at his home in Washington Square, New York City.

Again, reportedly, at the strong insistence of Mrs. Schuyler, George L. Schuyler sought to donate the (large, tarnish- and dust-prone) Cup to the New York Yacht Club as a perpetual Challenge Cup honoring the yacht AMERICA, to which end he wrote the following DEED OF GIFT: “New York July 8, 1857 To the Secretary of the New York Yacht Club.

Sir,

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The Deed

America’s Cup Compendium

Including Herbert C. Pell, Citizen’s, Louis Vuitton and Prada Cups

The undersigned members of the New York Yacht Club, and late owners of the schooner yacht America, beg leave through you to present to the Club the Cup won by the America at the Regatta of the Royal Yacht Squadron at Cowes, England, August 22, 1851.

This Cup was offered as a prize to be sailed for by yachts of all nations without regard to difference of tonnage, going round the Isle of Wight, the usual course for the Annual Regatta of the Royal Yacht Squadron, and was won by the America, beating eight cutters and seven schooner yachts which started in the race. This Cup is offered to the New York Yacht Club, subject to the following conditions: Any organized Yacht Club of any foreign country shall always be entitled, through any one or more of its members, to claim the right of sailing a match for this Cup with any yacht or other vessel of not less than 30 or more than 300 tons, measured by the Custom House rule of the country to which the vessel belongs. The parties desiring to sail for the Cup may make any match with the Yacht Club in possession of the same that may be determined upon by mutual consent; but in case of disagreement as to terms, the match shall be sailed over the usual course for the Annual Regatta of the Yacht Club in possession of the Cup, and subject to its Rules and Sailing Regulations—the challenging party being bound to give six months' notice in writing, fixing the day they wish to start. This notice to embrace the length, Custom House measurement, rig and name of the vessel.

It is to be distinctly understood that the Cup is to be the property of the Club, and not of the members thereof, or owners of the vessels winning it in a match; and that the condition of keeping it open to be sailed for by Yacht Clubs of all foreign countries, upon the terms above laid down, shall forever attach to it, thus making it perpetually a Challenge Cup for friendly competition between foreign countries.

J. C. Stevens Edwin A. Stevens Hamilton Wilkes J. Beekman Finley George L. Schuyler” These original owners held The Cup for 5 years and 11 months.

The Acceptance of The Cup and of the DEED OF GIFT formalized the transaction, making the New York Yacht Club (NYYC) the trustee of The Cup on July 8, 1857. i On July 20, 1857, NYYC notified eighteen (18) yacht clubs worldwide of the new international competition (see NOTICE OF CHALLENGE (Page 128). Those clubs were:

Yacht Club Yacht Club Royal Belge Royal Canadian YC Royal Yacht Squadron Royal Dee YC Royal Harwich YC Royal Mersey YC Royal Southern YC Royal Thames YC Royal Victoria YC Royal Western YC (ENG) Royal Yorkshire YC Royal London YC Royal Boston YC Prince of Wales YC Wear Yacht Club Royal Cork YC Royal Irish YC Royal St. George's YC Royal Western YC (IRE) Imperial YC Royal Eastern YC Royal Northern YC Royal Netherlands YC Amsterdam YC Royal Welsh YC

City Nation Antwerp Belgium Toronto Canada Cowes England Chester England Harwich England Liverpool England Southampton England London England Ryde England Plymouth England Hull England London England Boston England London England Sunderland England Queenstown Ireland Kingstown (Dún Laoghaire) Ireland Kingstown (Dún Laoghaire) Ireland Dublin Ireland St. Petersburg Russia Edinburgh Scotland Glasgow Scotland Rotterdam The Netherlands Amsterdam The Netherlands ii Caernarfon Wales

List Courtesy R. Steven Tsuchiya

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The NYYC conducted the following races in defense of the Cup between 1870 and 1881: • • • •

NYYC held the First Defense of the Queen’s Cup on Monday, August 8, 1870. The Race was won (1:0) by yacht Magic (NYYC), against challenger yacht Cambria (RTYC iii) and 13 NYYC competitors who finished, seven who did not finish the race, and one yacht who was disqualified. NYYC retained the Cup as Trustee.

NYYC held a 5-race Second Defense of the Queen’s Cup on October 16, to October 24, 1871. The Regatta was won (4:1) by yacht Columbia (NYYC), against challenger yacht Livonia (RHYC iv). NYYC retained the Cup as Trustee.

NYYC held a 2-race Third Defense of the Queen’s Cup on August 11, to August 12, 1876. The Regatta was won (2:0) by yacht Madeleine (NYYC), against challenger yacht Countess of Dufferin (RCYCv). NYYC retained the Cup as Trustee.

NYYC held a 2-race Fourth Defense of the Queen’s Cup on November 9, to November 10, 1881. The Regatta was won (2:0) by yacht Mischief (NYYC), against challenger yacht Atalanta (BQYC vi). NYYC retained the Cup as Trustee.

During the first 30 years after its inception, problems arose with the administration of the competition. As a result, the America's Cup was returned to George L. Schuyler, the sole-surviving donor, after two disappointing America's Cup races were sailed by Canadian Great Lakes yacht clubs under the command of Captain Alexander Cuthbert. Neither of the challenging vessels could withstand the rigors of open sea competition. The Countess of Dufferin, the first challenging vessel, was described as having "fresh water written all over her . . . [h]er hull lacked finish, being as rough as a nutmeg grater . . . and she had little of the shipshape appearance expected of a cup challenger."vii The Atalanta, the second challenging vessel, was also denounced by critics as being "a new yacht, hastily built, totally untried, and miserably equipped."viii To deal with this "unseaworthiness" issue, Schuyler amended the Deed of Gift with the intent of precluding Great Lakes yacht clubs from competing and reconveyed the America's Cup to the New York Yacht Club to hold in trust.

THE SECOND DEED of GIFT (February 2, 1882) “2nd February 1882.

Any organized Yacht Club of a foreign country, incorporated, patented or licensed by the legislature, admiralty or other executive' department, having for its annual regatta an ocean water course on the sea or on an arm of the sea (or one which combines both), practicable for vessels of 300 tons, shall always be entitled, through one or more of its members, to the right of sailing a match for this Cup, with a yacht or other vessel propelled by sails only, and constructed in the country to which the Challenging Club belongs, against any one yacht or vessel as aforesaid, constructed in the country of the club holding the Cup. The yacht or vessel to be of not less than 30 nor more than 300 tons, measured by the Custom House rule in use by the country of the challenging party.

The challenging party shall give six months' notice in writing, naming the day for the proposed race, which day shall not be later than seven months from the date of the notice.

The parties intending to sail for the Cup may, by mutual consent, make any arrangement satisfactory to both as to the date, course, time allowance, number of trials, rules and sailing regulations, and any and all other conditions of the match, in which case also the six-months' notice may be waived.

In case the parties cannot mutually agree upon the terms of a match, then the challenging party shall have the right to contest for the Cup in one trial, sailed over the usual course for the Annual Regatta of the club holding the Cup, subject to its rules and sailing regulations, the challenged party not being required to name its representative until the time agreed upon for the start.

Accompanying the six-months' notice, there must be a Custom House certificate of the measurement, and a statement of the dimensions, rig and name of the vessel.

No vessel which has been defeated in a match for this Cup can again be selected by any club for its representative until after a contest for it by some other vessel has intervened, or until after the expiration of two years from the time such contest has taken place.

Vessels intending to compete for this Cup must proceed under sail on their own bottoms to the port where the contest is to take place.

Should the Club holding the Cup be for any cause dissolved, the Cup shall be handed over to any club of the same nationality it may select which comes under the foregoing rules.

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It is to be distinctly understood that the Cup is to be the property of the club and not of the owners of the vessel winning it in a match, and that the conditions of keeping it open to be sailed for by organized yacht clubs of all foreign countries, upon the terms above laid down, shall forever attach to it, thus making it perpetually a Challenge Cup for friendly competition between foreign countries.

Signed, George L. Schuyler” The New York Yacht Club conducted the following regattae as Trustees, under the Second Deed of Gift: • •

NYYC held a 2-race Fifth Defense of the America’s Cup on August 21, to August 24, 1885. The Races were won (2:0) by yacht Puritan (NYYC), against challenger yacht Genesta (RYSix). NYYC retained the Cup as Trustee.

NYYC held a 3-race Sixth Defense of the America’s Cup on September 7, to September 11, 1886. The Regatta was won (2:0|1) by yacht Mayflower (NYYC), against challenger yacht Galatea (RNYCx). NYYC retained the Cup as Trustee.

In 1887 the Cup was again returned to George L. Schuyler, the sole-surviving donor who again AMENDED the DEED of GIFT. In addition to requiring that a challenger be an "organized" yacht club, the Amended Deed of Gift, now dated October 24, 1887, added new eligibility requirements that a challenger must meet, including that it be "incorporated, patented, or licensed by the legislature, admiralty, or other executive department, having for its annual regatta an ocean water course" (Deed of Gift, Oct. 24, 1887, ¶ 4).

The Deed further provides that the Cup "shall be preserved as a perpetual Challenge Cup for friendly competition between foreign countries."xi

AMENDED DEED of GIFT (October 24, 1887) “This DEED OF GIFT made the twenty-fourth day of October, one thousand eight hundred and eighty-seven, Between GEORGE L. SCHUYLER as sole surviving owner of the Cup won by the yacht America at Cowes, England, on the twenty-second day of August, one thousand eight hundred and fifty-one, of the first part, and THE NEW YORK YACHT CLUB, of the second part, WITNESSETH: THAT the said party of the first part, for and in consideration of the premises and of the performance of the conditions and agreements hereinafter set forth by the party of the second part, has granted, bargained, sold, assigned, transferred and set over, and by these presents does grant, bargain, sell, assign, transfer and set over unto the said party of the second part, its successors and assigns, the Cup won by the schooner yacht America at Cowes, England, upon the twenty-second day of August, 1851. To Have and To Hold the same to the said party of the second part, its successors and assigns, IN TRUST NEVERTHELESS, for the following uses and purposes: This Cup is donated upon the condition that it shall be preserved as a perpetual challenge Cup for friendly competition between foreign countries.

Any organized yacht Club of a foreign country, incorporated, patented, or licensed by the legislature, admiralty or other executive department, having for its annual regatta an ocean water course on the sea, or on an arm of the sea, or one which combines both, shall always be entitled to the right of sailing a match for this Cup with a yacht or vessel propelled by sails only and constructed in the country to which the challenging Club belongs, against any one yacht or vessel constructed in the country of the Club holding the Cup. The competing yachts or vessels, if of one mast, shall be not less than sixty-five feet nor more than ninety feet on the load water line; if of more than one mast, they shall be not less than eighty feet nor more than one hundred and fifteen feet on the load water line.

The challenging Club shall give ten months’ notice in writing naming the days for the proposed races; but no race shall be sailed in the days intervening between November first and May first. Accompanying the ten months’ notice of challenge, there must be sent the name of the owner and a certificate of the name, rig and the following dimensions of the challenging vessel, namely, length on load water line; beam at load water line, and extreme beam; and draught of water; which dimensions shall not be exceeded; and a custom-house registry of the vessel must also be sent as soon as possible. Vessels selected to compete for this Cup must proceed under sail on their own bottoms to the port where the contest is to take place. Centreboard or sliding keel vessels shall always be allowed to compete in any race for this Cup, and no restriction nor limitation whatever shall be placed upon the use of such centreboard or sliding keel, nor shall the centreboard or sliding keel be considered a part of the vessel for any purposes of measurement.

The Club challenging for the Cup and the Club holding the same may by mutual consent make any arrangement satisfactory to both as to the dates, courses, number of trials, rules and sailing regulations, and any and all other conditions of the match, in which case also the ten months’ notice may be waived.

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In case the parties cannot mutually agree upon the terms of a match, then three races shall be sailed, and the winner of two of such races shall be entitled to the Cup. All such races shall be on ocean courses, free from headlands, as follows: the first race, twenty nautical miles to windward and return; the second race, an equilateral triangular race of thirty-nine nautical miles, the first side of which shall be a beat to windward; the third race, (if necessary), twenty nautical miles to windward and return; and one week day shall intervene between the conclusion of one race and the starting of the next race. These ocean courses shall be practicable in all parts for vessels of twenty-two feet draught of water and shall be selected by the Club holding the Cup; and these races shall be sailed subject to its rules and sailing regulations so far as the same do not conflict with the provisions of this deed of gift, but without any time allowances whatever. The challenged Club shall not be required to name its representative vessel until at the time agreed upon for the start, but the vessel when named must compete in all the races; and each of such races must be completed within seven hours.

Should the Club holding the Cup be for any cause dissolved, the Cup shall be transferred to some Club of the same nationality, eligible to challenge under this deed of gift, in trust and subject to its provisions. In the event of the failure of such transfer within three months after such dissolution, said Cup shall revert to the preceding Club holding the same, and under the terms of this deed of gift.

It is distinctly understood that the Cup is to be the property of the Club, subject to the provisions of this deed, and not the property of the owner or owners of any vessel winning a match.

No vessel which has been defeated in a match for this Cup can be again selected by any club as its representative until after a contest for it by some other vessel has intervened, or until after the expiration of two years from the time of such defeat. And when a challenge from a Club fulfilling all the conditions required by this instrument has been received, no other challenge can be considered until the pending event has been decided.

AND the said party of the second part hereby accepts the said Cup subject to the said trust, terms and conditions, and hereby covenants and agrees to and with said party of the first part that it will faithfully and fully see that the foregoing conditions are fully observed and complied with by any contestant for the said Cup during the holding thereof by it; and that it will assign transfer and deliver the said Cup to the foreign yacht Club whose representative yacht shall have won the same in accordance with the foregoing terms and conditions, provided the said foreign Club shall by instrument in writing lawfully executed enter with said party of the second part into the like covenants as are herein entered into by it, such instrument to contain a like provision for the successive assignees to enter into the same covenants with their respective assignors, and to be executed in duplicate, one to be retained by each Club, and a copy thereof to be forwarded to the said party of the second part.

IN WITNESS WHEREOF, the said party of the first part has hereunto set his hand and seal, and the said party of the second part has caused its corporate seal to be affixed to these presents and the same to be signed by its Commodore and attested by its Secretary, the day and year first above written.

In the presence of H. D. Hamilton.

George L. Schuyler The New York Yacht Club

by Elbridge T. Gerry, Commodore.

John H. Bird, Secretary” {Seal of the NYYC} George Lee Schuyler died in New London, CT on July 31, 1890 of heart disease at age 79. xii Following the passing of Mr. Schuyler, changes to the DEED of GIFT could only be undertaken with the intervention of the Supreme Court of the State of New York. The Courts have allowed two (2) amendments over the ensuing years: • December 17, 1956 incorporating the “Waterline Length” and “Own Bottom” Amendments.

• April 5, 1985 incorporating the “Southern Hemisphere” Amendment The Court’s Orders appear below.

WATERLINE LENGTH and OWN BOTTOM AMENDMENTS by NEW YORK SUPREME COURT ORDER with RESPECT to ADMINISTRATION of GIFT (December 17, 1956) ORDER OF THE SUPREME COURT OF THE STATE OF NEW YORK DATED DECEMBER 17, 1956

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America’s Cup Compendium

Including Herbert C. Pell, Citizen’s, Louis Vuitton and Prada Cups

NEW YORK YACHT CLUB, having filed a verified petition dated September 21, 1956, praying that an order be made pursuant to Section 12 of the Personal Property Law or otherwise, directing that the gift by George L. Schuyler of the America’s Cup which was won by the yacht AMERICA at Cowes, England on August 22, 1851, in trust under a Deed of Gift dated October 24, 1887, shall be administered as if the minimum load water-line length of the competing yachts or vessels of one mast and thereby required to be forty-four (44) feet and without regard to and free from the direction contained therein that yachts or vessels competing for the America’s Cup shall sail on their own bottoms to the port where the contest is to take place, and that such other and further relief as to the Court may seem just and proper be granted to petitioner; and it appearing to the satisfaction of the Court from said petition and the papers annexed thereto that circumstances have so changed since the execution of said Deed of Gift, in a manner not known to the said donor and not anticipated by him, as to render impractical a literal compliance with the aforesaid terms of said Deed of Gift; and it further appearing that the grantor of said Deed of Gift has died and that the Attorney General of the State of New York is the only person interested in this proceeding; and said Attorney General having appeared and certified that he has no objections to the entry of an order as prayed for by petitioner, NOW, upon motion of Carter, Ledyard and Milburn, attorneys for petitioner, it is ORDERED that New York Yacht Club, as trustee of the America’s Cup given under the Deed of Gift dated October 24, 1887 made by George L. Schuyler, hereby is directed to administer the said Gift as if said Deed of Gift included no provision requiring yachts or vessels competing for the America’s Cup to sail, on their own bottoms, to the port where the contest is to take place, and as if the minimum load water-line length of the competing yachts or vessels of one mast was thereby required to be forty-four (44) feet.

Enter, Hon. Edgar J. Nathan, Jr. J.S.C. Justice

ARM OF THE SEA INTERPRETATION (September 20, 1984) JUDGEMENT OF THE SUPREME COURT OF THE STATE OF NEW YORK DATED SEPTEMBER 20, 1984 An application having been made by Petitioner The Royal Perth Yacht Club of Western Australia Incorporated for an order interpreting certain provisions of a Deed of Gift of the America’s Cup dated October 24, 1887 between George L. Schuyler and The New York Yacht Club, as amended by order of the Court dated December 1956 (Index No/ 12696/56); NOW, upon reading and filing the order to show cause dated August 8, 1984 by (Alfred M. Ascione, Jr., J.) with proof of due and timely service on the Attorney General of the State of New York, the petition of The Royal Yacht Club of Western Australia Incorporated, verified the 30th day of July, 1984, and annexed exhibits, and the affidavit of Eugene M. Kinney, sworn to the 20th day of July 1984 and exhibits thereof, all in support of the petition, and the notice of appearance and consent of the Attorney General of the State of New York, acknowledged the 13th day of August, 1984, consenting to the petition; AND, a memorandum decision and order dated September 4, 1984 and entered September 7, 1984, having been rendered granting the petition; NOW, upon the motion of DeForest & Duer, attorneys for the petitioner The Royal Perth Yacht Club of Western Australia Incorporated, it is ORDERED AND ADJUDGED, that the petition of the Royal Perth Yacht Club of Western Australia Incorporated is granted with the consent of the Attorney General of the State of New York, representative of the public interest in the Deed of Gift, to the extent of declaring that the Deed of Gift entitles the Chicago Yacht Club, a yacht club of a foreign (i.e. competing) country as contemplated in the Deed of Gift, to enroll and compete as a contestant for the “America’s Cup”.

Entered, Hon. Robert E. White JSC, Justice

SOUTHERN HEMISPHERE AMENDMENT PER ORDER of THE SUPREME COURT of THE STATE of NEW YORK (April 5, 1985) ORDER OF THE SUPREME COURT OF THE STATE OF NEW YORK DATED APRIL 5, 1985 An application having been made by petitioner The Royal Perth Yacht Club of Western Australia Incorporation for an order amending a certain provision of a Deed of Gift of the America’s Cup dated October 24, 1887 between George l. Schuyler and The New York Yacht Club, as amended by the Court dated December 17, 1956 (Index No. 12696/56);

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NOW, upon reading and filing the order to show cause dated February 27, 1985 (Stanley Parness, J.) with proof of due and timely service on the Attorney General of the State of New York and The New York Yacht Club, the petition of The Royal Perth Yacht Club of Western Australia Incorporated, verified the 27th day of November, 1984, and annexed exhibits, and the affidavit of Charles E. Kirsch, sworn to the 26th day of February, 1985, and annexed exhibits, all in support of the petition, and the notice of appearance and consent of the Attorney General of the State of New York, acknowledged the 7th day of March, 1985, consenting to the petition; and there being no opposition; AND, a memorandum order dated March 11, 1985 having been rendered granting the petition on default; NOW, upon the motion of DeForest & Duer, attorneys of petition The Royal Perth Yacht Club of Western Australia Incorporated, it is ORDERED, that the petition of The Royal Perth Yacht Club of Western Australia Incorporated is granted; and it is further ORDERED, that the Deed of Gift is amended, and the trust established pursuant to the Deed of Gift shall hereafter be administered, as if, following the phrase "No race shall be sailed in the days intervening between November 1st and May 1st", there were added the following language: "if the races are to be conducted in the Northern Hemisphere; and no race shall be sailed in the days intervening between May 1st and November 1st in the Southern Hemisphere."

Enter, Hon. Elliot Wilk J.S.C. Justice

CURRENT DEED of GIFT (April 8, 1985) (interlineated to show changes) The resulting (and current) version of the DEED of GIFT, incorporating court-approved amendments, dated April 8, 1985 reads as follows:

“This DEED OF GIFT made the twenty-fourth day of October, one thousand eight hundred and eighty-seven, Between GEORGE L. SCHUYLER as sole surviving owner of the Cup won by the yacht America at Cowes, England, on the twenty-second day of August, one thousand eight hundred and fifty-one, of the first part, and THE NEW YORK YACHT CLUB, of the second part, as amended by orders of the Supreme Court of the State of New York dated December 17, 1956, and April 5, 1985, WITNESSETH: THAT the said party of the first part, for and in consideration of the premises and of the performance of the conditions and agreements hereinafter set forth by the party of the second part, has granted, bargained, sold, assigned, transferred and set over, and by these presents does grant, bargain, sell, assign, transfer and set over unto the said party of the second part, its successors and assigns, the Cup won by the schooner yacht America at Cowes, England, upon the twenty-second day of August, 1851. To Have and To Hold the same to the said party of the second part, its successors and assigns, IN TRUST NEVERTHELESS, for the following uses and purposes: This Cup is donated upon the condition that it shall be preserved as a perpetual challenge Cup for friendly competition between foreign countries.

Any organized yacht Club of a foreign country, incorporated, patented, or licensed by the legislature, admiralty or other executive department, having for its annual regatta an ocean water course on the sea, or on an arm of the sea, or one which combines both, shall always be entitled to the right of sailing a match for this Cup with a yacht or vessel propelled by sails only and constructed in the country to which the challenging Club belongs, against any one yacht or vessel constructed in the country of the Club holding the Cup. The competing yachts or vessels, if of one mast, shall be not less than sixty-five forty-four feet nor more than ninety feet on the load water line; if of more than one mast, they shall be not less than eighty feet nor more than one hundred and fifteen feet on the load water line.

The challenging Club shall give ten months’ notice in writing naming the days for the proposed races; but no race shall be sailed in the days intervening between November first and May first if the races are to be conducted in the Northern Hemisphere; and no race shall be sailed in the days intervening between May first and November first if the races are to be conducted in the Southern Hemisphere. Accompanying the ten months’ notice of challenge, there must be sent the name of the owner and a certificate of the name, rig and the following dimensions of the challenging vessel, namely, length on load water line; beam at load water line, and extreme beam; and draught of water; which dimensions shall not be exceeded; and a custom-house registry of the vessel must also be sent as soon as possible. Vessels selected to compete for this Cup must proceed under sail on their own bottoms to the port where the contest is to take place. Centreboard or sliding keel vessels shall always be allowed to compete in any race for this Cup,

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and no restriction nor limitation whatever shall be placed upon the use of such centreboard or sliding keel, nor shall the centreboard or sliding keel be considered a part of the vessel for any purposes of measurement.

The Club challenging for the Cup and the Club holding the same may by mutual consent make any arrangement satisfactory to both as to the dates, courses, number of trials, rules and sailing regulations, and any and all other conditions of the match, in which case also the ten months’ notice may be waived.

In case the parties cannot mutually agree upon the terms of a match, then three races shall be sailed, and the winner of two of such races shall be entitled to the Cup. All such races shall be on ocean courses, free from headlands, as follows: the first race, twenty nautical miles to windward and return; the second race, an equilateral triangular race of thirty-nine nautical miles, the first side of which shall be a beat to windward; the third race, (if necessary), twenty nautical miles to windward and return; and one week day shall intervene between the conclusion of one race and the starting of the next race. These ocean courses shall be practicable in all parts for vessels of twenty-two feet draught of water and shall be selected by the Club holding the Cup; and these races shall be sailed subject to its rules and sailing regulations so far as the same do not conflict with the provisions of this deed of gift, but without any time allowances whatever. The challenged Club shall not be required to name its representative vessel until at the time agreed upon for the start, but the vessel when named must compete in all the races; and each of such races must be completed within seven hours.

Should the Club holding the Cup be for any cause dissolved, the Cup shall be transferred to some Club of the same nationality, eligible to challenge under this deed of gift, in trust and subject to its provisions. In the event of the failure of such transfer within three months after such dissolution, said Cup shall revert to the preceding Club holding the same, and under the terms of this deed of gift. It is distinctly understood that the Cup is to be the property of the Club, subject to the provisions of this deed, and not the property of the owner or owners of any vessel winning a match.

No vessel which has been defeated in a match for this Cup can be again selected by any club as its representative until after a contest for it by some other vessel has intervened, or until after the expiration of two years from the time of such defeat. And when a challenge from a Club fulfilling all the conditions required by this instrument has been received, no other challenge can be considered until the pending event has been decided.

AND the said party of the second part hereby accepts the said Cup subject to the said trust, terms and conditions, and hereby covenants and agrees to and with said party of the first part that it will faithfully and fully see that the foregoing conditions are fully observed and complied with by any contestant for the said Cup during the holding thereof by it; and that it will assign transfer and deliver the said Cup to the foreign yacht Club whose representative yacht shall have won the same in accordance with the foregoing terms and conditions, provided the said foreign Club shall by instrument in writing lawfully executed enter with said party of the second part into the like covenants as are herein entered into by it, such instrument to contain a like provision for the successive assignees to enter into the same covenants with their respective assignors, and to be executed in duplicate, one to be retained by each Club, and a copy thereof to be forwarded to the said party of the second part.

IN WITNESS WHEREOF, the said party of the first part has hereunto set his hand and seal, and the said party of the second part has caused its corporate seal to be affixed to these presents and the same to be signed by its Commodore and attested by its Secretary, the day and year first above written.

In the presence of H. D. Hamilton.

George L. Schuyler The New York Yacht Club

by Elbridge T. Gerry, Commodore.

John H. Bird, Secretary {Seal of the NYYC}”

The Regattae Conducted under the Amended Deed The New York Yacht Club conducted the following regattae as Trustees under the Amended Deed of Gift: •

NYYC held a 2-race Seventh Defense of the America’s Cup on September 27, to September 30, 1887. The Regatta was won (2:0) by yacht Volunteer (NYYC), against challenger yacht Thistle (RCYCxiii). NYYC retained the Cup as Trustee.

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NYYC held a 4-race Eighth Defense of the America’s Cup on October 7, to October 13, 1893. The Regatta was won (3:0|1) by yacht Vigilant (NYYC), against challenger yacht Valkyrie II (RYS). NYYC retained the Cup as Trustee.

•

NYYC held a 3-race Ninth Defense of the America’s Cup on September 7, to September 17, 1895. The Races were won (3:0) by yacht Defender (NYYC), against challenger yacht Valkyrie III (RYS). NYYC retained the Cup as Trustee.

•

NYYC held a 6-race Tenth Defense of the America’s Cup on October 3, to October 17, 1899. The Regatta was won (3:0|3) by yacht Columbia (NYYC), against challenger yacht Shamrock (RUYCxiv). NYYC retained the Cup as Trustee.

•

NYYC held a 5-race Eleventh Defense of the America’s Cup on September 26, to October 4, 1901. The Regatta was won (3:0|2) by yacht Columbia (NYYC), against challenger yacht Shamrock II (RUYC). NYYC retained the Cup as Trustee.

•

NYYC held a 8-race Twelfth Defense of the America’s Cup on August 22, to September 3, 1903. The Regatta was won (3:0|5) by yacht Reliance (NYYC), against challenger yacht Shamrock III (RUYC). NYYC retained the Cup as Trustee.

•

NYYC held a 7-race Thirteenth Defense of the America’s Cup on July 15, to July 27, 1920. The Regatta was won (3:2|2) by yacht Resolute (NYYC), against challenger yacht Shamrock IV (RUYC). NYYC retained the Cup as Trustee.

•

NYYC held a 5-race Fourteenth Defense of the America’s Cup on September 13, to September 18, 1930. The Races were won (3:0|2) by yacht Enterprise (NYYC), against challenger yacht Shamrock V (RUYC). NYYC retained the Cup as Trustee.

•

NYYC held a 7-race Fifteenth Defense of the America’s Cup on September 15, to September 25, 1934. The Regatta was won (4:2|1) by yacht Rainbow (NYYC), against challenger yacht Endeavour (RYS). NYYC retained the Cup as Trustee.

•

NYYC held a 4-race Sixteenth Defense of the America’s Cup on July 31, to August 5, 1937. The Regatta was won (4:0) by yacht Ranger (NYYC), against challenger yacht Endeavour II (RYS). NYYC retained the Cup as Trustee.

The New York Yacht Club conducted the next races under the 1956 Amended Deed of Gift: •

NYYC held a 5-race Seventeenth Defense of the America’s Cup on September 20, to September 26, 1958. The Regatta was won (4:0|1) by yacht Columbia (NYYC), against challenger yacht Sceptre (RYS). Sailed in accordance with the 1956 Deed of Gift Amendments. NYYC retained the Cup as Trustee.

•

NYYC held a 5-race Eighteenth Defense of the America’s Cup on September 15, to September 25, 1962. The Races were won (4:1) by yacht Weatherly (NYYC), against challenger yacht Gretel (RSYS xv). NYYC retained the Cup as Trustee.

•

NYYC held a 4-race Nineteenth Defense of the America’s Cup on September 15, to September 21, 1964. The Regatta was won (4:0) by yacht Constellation (NYYC), against challenger yacht Sovereign (RTYCxvi). NYYC retained the Cup as Trustee.

•

NYYC held a 4-race Twentieth Defense of the America’s Cup on September 12, to September 18, 1967. The Regatta was won (4:0) by yacht Intrepid (NYYC), against challenger yacht Dame Pattie (RSYC). NYYC retained the Cup as Trustee.

•

NYYC held a 6-race Twenty-first Defense of the America’s Cup on September 15, to September 28, 1970. The Regatta was won (4:1|1) by yacht Intrepid (NYYC), against challenger yacht Gretel II (RSYS). NYYC retained the Cup as Trustee.

•

NYYC held a 5-race Twenty-second Defense of the America’s Cup on September 10, to September 17, 1974. The Races were won (4:0|1) by yacht Courageous (NYYC), against challenger yacht Southern Cross (RPYC xvii). NYYC retained the Cup as Trustee.

•

NYYC held a 4-race Twenty-third Defense of the America’s Cup on September 13, to September 18, 1977. The Regatta was won (4:0) by yacht Courageous (NYYC), against challenger yacht Australia (RPYC). NYYC retained the Cup as Trustee.

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•

NYYC held a 6-race Twenty-fourth Defense of the America’s Cup on September 16, to September 25, 1980. The Regatta was won (4:1|1) by yacht Freedom (NYYC), against challenger yacht Australia (RPYC). NYYC retained the Cup as Trustee.

•

NYYC held an 8-race Twenty-fifth Defense of the America’s Cup on September 14, to September 26, 1983. The Regatta was won (4:3|1) by challenger yacht Australia II (RPYC), against defender yacht Liberty (NYYC). Royal Perth Yacht Club (RPYC) assumed the Cup as 2nd Trustee. NYYC relinquished control of the cup after holding it for 113 years, 1.5 months.

The next series of races were conducted incorporating the 1985 Amended Deed of Gift: •

RPYC held a 4-race Twenty-sixth Defense of the America’s Cup on January 31, to February 4, 1987. The Races were won (4:0) by challenger yacht Stars & Stripes (SDYC), against defender yacht Kookaburra III (RPYC). Sailed in accordance with the 1985 Deed of Gift Amendments. San Diego Yacht Club (SDYC) assumed the Cup as its 3rd Trustee. RPYC relinquished control of the cup after holding it for 3 years, 4 months.

•

SDYC held a 2-race Twenty-seventh Defense of the America’s Cup on September 7, to September 9, 1988. The Regatta was won (2:0) by yacht Stars & Stripes (SDYC), against challenger yacht New Zealand (Mercury Bay Boat Club) (MBBC). SDYC retained the Cup as Trustee.

•

SDYC held a 5-race Twenty-eighth Defense of the America’s Cup on May 9, to May 16, 1992. The Regatta was won (4:1) by yacht America3 (SDYC), against challenger yacht Il Moro de Venzia (CDVV xviii). SDYC retained the Cup as Trustee.

•

SDYC held a 5-race Twenty-ninth Defense of the America’s Cup on May 6, to May 13, 1995. The Regatta was won (5:0) by challenger yacht Black Magic (RNZYCxix), against defender yacht Young America (SDYC). Royal New Zealand Yacht Club (RNZYC) assumed the Cup as its 4th Trustee. SDYC relinquished control of the cup after holding it for 8 years, 2 months.

•

RNZYC held a 5-race Thirtieth Defense of the America’s Cup on February 20, to March 2, 2000. The Regatta was won (5:0) by yacht Team New Zealand (RNZYC), against challenger yacht Prada Luna Rossa (YCPAxx). RNZYC retained the Cup as Trustee.

•

RNZYC held a 5-race Thirty-first Defense of the America’s Cup on February 15, to March 2, 2003. The Regatta was won (5:0) by challenger yacht Alinghi (SNG xxi), against defender yacht Team New Zealand (RNZYC). Société Nautique de Geneve (SNG) assumed the Cup as its 5th Trustee. RNZYC relinquished control of the cup after holding it for 7 years, 10 months.

•

SNG held a 7-race Thirty-second Defense of the America’s Cup on June 23, to July 3, 2007. The Regatta was won (5:2) by yacht Alinghi, against challenger yacht Emirates Team New Zealand. SNG retained the Cup as Trustee.

•

SNG held a 2-race Thirty-third Defense of the America’s Cup on February 12, to February 14, 2010. The Regatta was won (2:0) by challenger yacht USA-17 (GGYC xxii), against defender yacht Alinghi 5 (SNG). Golden Gate Yacht Club (GGYC) assumed the Cup as its 6th Trustee. SNG relinquished control of the cup after holding it for 6 years, 11 months.

•

GGYC held a 27-race Thirty-fourth Defense of the America’s Cup on September 7, to September 25, 2013. The Regatta was won (9:8|10) by yacht Oracle Team USA (GGYC) (9-8), against challenger yacht Emirates Team New Zealand (RNZYS). GGYC retained the Cup as Trustee.

•

GGYC held a 9-race Thirty-fifth Defense of the America’s Cup on June 17, to June 26, 2017. The Regatta was won (8:1) by challenger yacht New Zealand, against defender yacht USA-17 (GGYC). Royal New Zealand Yacht Squadron (RNZYS) assumed the Cup as its 7th Trustee. GGYC relinquished control of the cup after holding it for 7 years, 4 months.

•

RNZYS held a 10-race Thirty-sixth Defense of the America’s Cup on March 9, to March 17, 2021. The Regatta was won (7:3) by yacht Emirates Team New Zealand against challenger Luna Rossa Prada Pirelli yacht. RNZYS retained the Cup as Trustee.

•

RNZYS and INEOS announced INEOS as Challenger of Record (COR) on March 18, 2021 for the Thirty-seventh Defense of the America’s Cup. The regatta will be held in October 2024 in Barcelona, Spain.

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RECORD OF COURT CHALLENGES UNDER THE DEED OF GIFT Over the years, disputes that could not be resolved within the express language of the Deed of Gift, were heard before the Courts of the State of New York

CASE 1: MERCURY BAY BOATING CLUB vs SAN DIEGO YACHT CLUB {**12 NY3d at 252} Club (76 NY2d 256 [1990] and its APPEAL {76 N.Y. 2d 256, 557 N.E.2d 87,557 N.Y.S. 2d 851 (1990)} This case involves the Mercury Bay Boating Club’s monohull being met by the San Diego Yacht Club’s catamaran.

SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK: IAS PART 15 ********** THE MERCURY BAY BOATING CLUB INC. Plaintiff, -againstSAN DIEGO YACHT CLUB and ROYAL PERTH YACHT CLUB OF WETERN AUSTRALIA (INC.), Defendants, *********** In the matter of the Application of SAN DIEGO YACHT CLUB Petitioner, For an Order pursuant to EPTL Section 8.1(c )(1) or otherwise, interpreting the Deed of Gift of the America’s Cup, or in the alternative amending the terms of said Deed of Gift.

CARMEN BEAUCHAMP CIPARICK, J.： In the wake of the September, 1988 San Diego Yacht Club (“San Diego") defense of the America's Cup, both the challenger, the Mercury Bay Boating Club Inc. (“Mercury Bay") and the defender call upon this court to determine the lawful holder of the Cup. The parties initially appeared before this court in a dispute over the validity of the underlying July, 1987 challenge by Mercury Bay to sail a match for the America’s Cup with a yacht measuring ninety feet on the load water-line. The court found the challenge to be valid and declined to amend the Deed of Gift to bar such challenge as sought by San Diego. The parties were then directed in the December 21, 1987 judgement of this court to sail a match for the America’s Cup in accordance with the terms of the Deed of Gift.

Thereafter, Mercury Bay sought to hold San Diego in civil contempt for threatening to defend the America’s Cup in a catamaran.

This court's decision of July 25, 1988 determined that there was, at that juncture, no basis for a finding of contempt nor for rendering an advisory opinion. The court further stated that "Nothing in this decision should be interpreted as indicating that multihulled boats are either permitted or barred under the America’s Cup deed of gift.” The parties were expressly advised therein of the risk of forfeiture under the Deed.

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San Diego's subsequent September, 1988 defense of the America’s Cup with a catamaran and victory in races held on September 7th and 9th is the genesis of the current motion by both parties to determine the lawful holder of the Cup. The court notes that, despite the urgings of the court and the global yachting community, San Diego and Mercury Bay were unable to reach an agreement as to acceptable terms of the race so as to conduct the competition under the “mutual consent" provisions of the Deed of Gift and to provide for multinational participation. Instead, the parties competed in all respects under the "challenge" provisions of the Deed of Gift for what is apparently the first time since the original conveyance of the Americans Cup to the New York Yacht Club in July, 1857.

The Deed of Gift as amended in 1887 was uniquely designed to permit the holder of the Cup and a challenger to agree on virtually all of the terms of the race, including the type of vessel, with certain limitations. Through their unprecedented intransigence, San Diego and Mercury Bay have charted a course that has inextricably led them to the courthouse for a determination as to the lawful holder of the America’s Cup. The nature of the issue facing this court is not in controversy. This court must determine whether, under the Deed of Gift, San Diego was permitted to defend the Mercury Bay challenge for the America’s Cup with a multihulled vessel, specifically, a catamaran. The issue is unique as this is the first time in Americans Cup history that resort to litigation has been necessary to determine the Cup victor. In addition, this is the first time in the over one-hundred-and-thirty-year history of the world's most prestigious yachting competition that a yacht club has chosen to compete with a multihulled vessel; to which the challenger has objected throughout.

To determine the disqualification question the court, must look to the Deed of Gift which sets forth the race conditions and the basic specifications of the vessels. San Diego argues that other than the following express limitations of the Deed requiring that the competing vessels be： "propelled by sails only . . . " and “if of one mast, shall not be less than forty-four nor more than ninety feet on the load water line . .” the defending club may choose any type of vessel without regard to the nature of the challenging vessel or its specifications.

Mercury Bay, on the other hand, contends that the Deed of Gift, read as a whole, limits the defender beyond the foregoing express terms of the Deed of Gift so as to require the defender to compete in a match on equal terms with a “like or similar vessel.”

The Deed of Gift is a compact two page statement of the terms under which the Cup is to be held and competed for. Both Mercury Bay and San Diego, as well as the Attorney General of the State of New York and the New York Yacht Club, are in agreement that the forfeiture issue must be determined by resort to "the Deed of Gift and the donor’s intent as expressed therein.” No external rules of yachting competition apply.

It is axiomatic that the impact of the trust instrument and the grantor’s intent must be gleaned from the four corners of the instrument. Therefore, by extension, the issue of disqualification should be determined by resort to the Deed of Gift (see, Matter of Jones, 38 N.Y. 2d 189; Matter of Kosek, 31 N.Y. 2d 475).

The Deed of Gift is devoid of references to multihulled vessels. Nor does the Deed state in specific terms the type of vessel or restrictions as to specifications of the defending vessel. The Deed provides that the competing vessels, "if of one mast shall be not less than forty-four nor more than ninety feet on “the load water-line" (as amended in 1956 to permit twelve meter boats). It is only in the challenge provision that specifications are fixed. The relevant provision provides in pertinent part: "The Challenging Club shall give ten months’ notice in writing, naming the days for the proposed races”…

Accompanying the ten months’ notice of challenge there must be sent the name of the owner and a certificate of the name,

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rig, and following dimensions of the challenging vessel, namely, length on load water-line: beam at load water-line and extreme beam: and draught of water: which dimensions shall not be exceeded： Mercury Bay aptly argues that in the context of an instrument drafted with an economy of words, there would be little logic in providing for the tender of specifications by the challenger ten months in advance if the defender could then construct any vessel meeting the bare minimum specifications of a “… vessel propelled by sail only" not exceeding "ninety feet on "the load water-line."

San Diego has, in the context of prior motions before this court, acknowledged the significance of the load water-line specification. The trust instrument points to the importance of this key specification by couching the minimum and maximum size vessel limitations in terms of load water-line measurement. It is generally conceded that in most sailing events a monohulled vessel with a longer load water-line would have a distinct advantage over a shorter monohull, as would a multihulled vessel over a monohull.

When considering the Deed’s basic specifications and the challenge notice requirements, the conclusion is inescapable that the donor contemplated the defending vessel to relate in some way to the specifications of the challenger. The requirement that the challenging vessel not exceed the dimensions given in the notice of challenge further supports the proposition that the Cup defender would rely on these specifications. Conversely, if the defender was free and therefore encouraged to build to the absolute specifications of the Deed without regard to the contents of the challenge, there would be no need for the challenger to reveal the specifications of its craft.

The Deed of Gift further provides： "Centre-board or sliding keel vessels shall always be allowed to compete in any race for this Cup, and no restrictions nor limitation whatever shall be placed upon the use of such centre-board or sliding keel nor shall the centre-board or sliding keel be considered a part of the vessel for any purposes of measurement.”

The use of the terms "centre-board or sliding keel” in the singular would tend to indicate that the donor did not contemplate multihulled vessels competing for the Cup. Catamarans were in existence in racing at the time of the Third Deed of Gift and the donor could have provided for their participation, by utilization of the plural in reference to centre-board or by specifying dimensions permissible for catamarans.

The court further notes that the basic minimum-maximum load water-line specifications, while of great significance in monohulled races, lose significance in "mixed” races between multihulled and monohulled vessels. Therefore, the nature of the basic specifications of the vessels set out in the Deed of Gift supports the conclusion that a race limited to monohulled vessels was contemplated by the donor. states:

Perhaps the most significant sentence of the Deed is the one setting forth the trust purpose. The pertinent provision

"This Cup is donated upon the condition that it shall be preserved as a perpetual Challenge Cup for friendly competition between foreign countries.”

The emphasis of the America’s Cup is on competition and sportsmanship. The intention of the donor was to foster racing between yachts or vessels on somewhat competitive terms. The Deed of Gift, when read as a whole, expresses the intent of the donor that the defender of the America’s Cup operating within the limitations of the challenge provisions, select a vessel that is competitive with that of the challenger. While this may not rise to the level of a .’like or similar" standard, the import is clear from the provisions of the Deed of Gift that although design variations are permitted, the vessels should be somewhat evenly matched.

The court, finds that the intent, of the donor, as expressed in the Deed of Gift, was to exclude a defense of the America’s Cup in a multihulled vessel by a defender faced with a monohull challenge. The challenge provision would be rendered meaningless if the defender was provided with the specifications of the challenging vessel and then afforded ten months to produce a vessel with an insurmountable competitive advantage. To sail a multihulled vessel against a monohulled yacht over the type of course Version 1.0

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contemplated by the donor is, in the opinion of most boating authorities, to create a gross mismatch and, therefore, is violative of the donor’s primary purpose of fostering friendly competition.

Notwithstanding the foregoing, if the Deed of Gift were determined to be ambiguous or uncertain as to the defending catamaran’s eligibility, it is a basic rule of trust construction that the court would then necessarily resort to extrinsic evidence and surrounding circumstances to ascertain the intent of the donor (see, Matter of Martin, 255 H.Y. 248; Matter of Smith, 254 N.Y. 283; Matter of Neil, 238 N.Y. 138).

While both parties halve resorted to extensive analysis of the correspondence and statements of George Schuyler as well as to the history of the America’s Cup in general, the balance of extrinsic evidence points to the conclusion that a genuine competition was of paramount importance to the donor, and that the defender is bound to produce a vessel on the starting line in keeping with that intent.

Very early in the history of the Cup, prior to the drafting of the Second Deed of Gift in 1882, George Schuyler was critical of the decidedly unfair practice of sailing a fleet of defending vessels against one challenger over a "club course" (the course used in the defender’s annual regatta). In a letter published in the Spirit the Times dated April 15, 1871, Schuyler set forth his definition of the term "match"： "a match means one party contending with another party upon equal terms as regards the task or feat to be accomplished.”

Schuyler went on to express his interpretation of the spirit of the America’s Cup when he stated that: "It seems to me that the present ruling of the club renders the America’s trophy useless as “a Challenge Cup” and that for all sporting purposes it might as well be laid aside as family plate. I cannot conceive of any yachtsman giving six months’ notice that he will cross the ocean for the sole purpose of entering into an almost hopeless contest for this Cup, when a challenge for love or money to meet any one yacht of-the New York Yacht Squadron in any fair race would give him as great a triumph, if successful( or if his challenge were not accepted, as his heart could desire.”

Schuyler was well known for his overriding concern that the terms of the Deed of Gift foster a fair competition without, either side holding a built-in advantage. To that end the Deed was amended on two occasions; the current Deed being the Third Deed of Gift.

The 1887 challenge of the Th i stl e points to the significance of the challenger’s specifications in framing the defender’s response.

As recounted in The Lawson History of the Americans CUP, the challenge sent by the Th i stl e specified a load waterline length of 85 feet. The yacht was officially measured prior to the race and found to be 86.46 feet at the water line.- This discrepancy was found to be serious in that the defender, VOLUNTEER , was designed with the specifications of the THISTLE in mind and was 85 feet 10 inches at the water line. Due to the discrepancy between the specifications of the written challenge and the measured load water-line of the challenger, a question was raised as to disqualification of the challenger. Mr. Schuyler’s opinion was sought by the Chairman of the America’s Cup Committee of the New York Yacht Club. Schuyler suggested that the T hi stl e be permitted to race since the discrepancy was not intentional and was due to an error in projection by the designer. Schuyler went on to state in correspondence (The Lawson History the America’s CUP. Thompson and Lawson, p. 121) ： "The clause in the deed of gift which requires, besides Custom House measurement, a statement of the “dimensions” of the vessel, is intended to convey a just idea of the capacity of the same without reference to any rule for racing tonnage which may be in force at the time the challenge is given.

The length of load water-line is an essential element. It was furnished by both Genesta and Galatea, and had it not been given by Thistle, the committee should have demanded it before closing the terms of the match…”

The races were completed with the defending Vo l un teer victorious, and the Deed of Gift was subsequently amended to require that, the challenger not exceed, the specifications in the challenge, to eliminate time allowances, and to provide for a fairer ocean water course.

The Th i stl e episode and the drafting of the Third Deed of Gift indicate the donor's overriding intent that the race be fair and competitive.

A trustee’s administration of a trust may also be instructive as to the way in which a trust should be construed (see, Rice v. Balsey, 156 A.D. 802, affd 215 N.Y. 656). Therefore, the practice of the trustee-defenders in implementing the Deed and the America’s Cup competition over the past one hundred and thirty-odd years may be considered by the court when addressing the viability of San Diego's defense with a catamaran.

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As the court has already noted, no participant has ever utilized a multihulled vessel in America’s Cup competition.

Additionally, notwithstanding the arguments proffered by San Diego as to design variations between past Cup competitors, it is distinctly significant that defenders have virtually always met, contenders with vessels of closely comparable (or shorter) load waterline lengths. This is obviously true of the twelve meter competitions held over the past thirty years. The early history of the Cup bears this out as 'well. San Diego makes much of the early correspondence between the New York Yacht Club and the English challenger Lord Dunraven, to indicate that the defender New York Yacht Club reserved its right to sail any size vessel against Lord Dunraven’s yacht Va l ky ri e. However, when the famous race was sailed, Lord Dunraven’s Va l ky ri e I I challenged in a vessel measuring 86.80 feet on the water-line against the defender Vigilant’s 86.19 load water-line length. The Cup history points to remarkably matched vessels when gauged by the significant load water-line specification. San Diego does point to the disparate dimensions in the Ma gi c v. Cambria competition of 1871. However, it is relevant to note that the smaller vessel Ma gic was the defender’s choice to compete against the larger vessel Cambria rather than an attempt at a mismatch. Also, time allowances were afforded in early America’s Cup competition.

While the history of the America’s Cup indicates that variations of design were not precluded, there appears to be virtually no instance where the challenger was not met with a comparable or smaller vessel in terms of load water-line length. To allow the use of a multihulled vessel is more than to countenance mere design variations. To permit a race between a monohull and a multihull would be to countenance a mismatch comparable to a race between monohull vessels with one having a substantial advantage in load water-line.

A resort to extrinsic evidence and the practice of implementation of the Deed of Gift further establishes that the Deed does not permit the defense of the America's Cup against a monohulled yacht by a catamaran.

While a competitive standard such as the "like or similar vessels“ standard offered by Mercury Bay may not always be easily implemented, there is no doubt that San Diego’s defense of the America’s Cup in a catamaran against Mercury Bay’s monohull challenge clearly deviated from the intent of the donor.

Therefore, whether the court limits its inquiry to the trust instrument or accepts extrinsic evidence, it is clear that, a catamaran may not defend in America’s Cup competition against a monohull. Accordingly, San Diego shall be disqualified in the September 1988 competition.

The court is mindful that forfeiture is a drastic remedy in the instance of a competition such as the America’s Cup with its large economic significance and prestige. Nonetheless the parties neither seek nor suggest any alternative relief upon the disqualification of a competitor, nor is any alternative relief feasible under the circumstances. San Diego was well aware of the risk it ran when it chose to follow the unprecedented course of defending in a catamaran. Barely paying lip service to the significance of the competition, its clear goal was to retain the Cup at all costs so that it could host a competition on its own terms. San Diego thus violated the spirit of the Deed. In contrast., The New York Yacht Club in its tenure as trustee for over one hundred years, was able to conduct numerous defenses without the need for judicial intervention to ensure conformity with Deed terms.

The defender of the America’s Cup is more than the current champion yacht club. The yacht club winning the America1s Cup becomes the sole trustee under the Deed of Gift and has an obligation thereunder to insure a fair competition. The holder of the Americans Cup is bound to a higher obligation than the victor of the Stanley Cup or the Superbowl. In organized sports such as hockey or football there is a central authority for the development and enforcement of competition rules. The defender of the America’s Cup, as trustee, is charged with the responsibility of insuring that a subsequent defense is carried out in accordance with the letter and spirit of the Deed of Gift. San Diego clearly fell short of its obligations as trustee of the Deed of Gift.

It is in the best interest of the America’s Cup competition that this episode be overcome and that the global yachting community be afforded a fair opportunity to participate in this prestigious event. It is hoped that further defender-trustees will place the interests of the Cup and its spirit in a paramount position. The court urges Mercury Bay to fulfill its obligations as "trustee in the spirit of friendly competition that George L. Schuyler intended. denied.

The application by Mercury Bay for disqualification of San Diego Yacht Club is granted. The application by San Di eg o is

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Settle order.

Dated: March 28, 1989

CASE 1A: MERCURY BAY BOATING CLUB VS SAN DIEGO YACHT CLUB {76 NY2d 256, 557 NE2d, 557 NYS2d 851 (1990) THE MERCURY BAY BOATING CLUB INC., APPELLANT, v.

SAN DIEGO YACHT CLUB, RESPONDENT, ET AL., DEFENDANT, NEW YORK YACHT CLUB, INTERVENOR. / (AND ANOTHER PROCEEDING.) 76 N.Y.2d 256, 557 N.E.2d 87, 557 N.Y.S.2d 851 (1990).

April 26, 1990 1 No. 52 Decided April 26, 1990 Robert B. Fiske, Jr., George N. Tompkins, Jr., NY City, for Appellant Mercury Bay. James W. Rayhill, Richard M. Waldron, NY City, for Intervenor NY Yacht Club. Michael D. Hess, Marjorie L. Cohen, NY City, for Defendant Royal Perth. Harold R. Tyler, Jr., Mark W. Smith, Blair Axel, Kenneth M. Poovey, James E. Brandt, NY City, for Respondent.

Robert Abrams, Attorney General (David G. Samuels, O. Peter Sherwood, Lawrence S. Kahn, Pamela A. Mann of counsel) on behalf of the Trust.

ALEXANDER, J.: On September 7 and 9, 1988, in the waters off San Diego, California, Mercury Bay Boating Club, Inc.'s challenger vessel, the New Zealand, a monohull-keel yacht, was defeated two races to none by San Diego Yacht Club's defending twin-hulled catamaran, the Stars and Stripes, in the 27th America's Cup Match. Contending that San Diego's defense of the Cup by sailing an inherently faster multihull catamaran against a larger, but slower monohull yacht was unsportsmanlike, antithetical to the concept of "friendly competition between foreign countries" and a "gross mismatch" in violation of the of America's Cup Deed of Gift and San Diego's obligations as trustee, Mercury Bay obtained a judgment in New York Supreme Court disqualifying San Diego's catamaran, declaring the New Zealand to be the winner of the two races and directing that San Diego transfer the America's Cup to Mercury Bay. A divided Appellate Division reversed, declared the Stars and Stripes to be an eligible vessel and the winner of the two races, and therefore that San Diego was the rightful holder of the America's Cup. We agree that the Stars and Stripes was an eligible vessel under the terms of the Deed of Gift and that San Diego breached no fiduciary duty in racing a catamaran against Mercury Bay's challenging yacht. Accordingly, we affirm.

I The America's Cup, a silver cup trophy, is the corpus of a charitable trust created in the 19th century under the laws of New York. So called because it was won by the yacht America in a race around the Isle of Wight in 1851, the America's Cup was donated by its six owners to the New York Yacht Club in 1857. The Cup was twice returned to George Schuyler, the sole surviving donor, when questions arose as to the terms of the trust in which the Cup was to be held. Schuyler executed the present Deed of Gift in 1887, donating the Cup to the New York Yacht Club, to be held in trust "upon the condition that it shall be preserved as a perpetual challenge Cup for the friendly competition between foreign countries".

Pursuant to the Deed of Gift, the holder of the Cup is its sole trustee and is to be succeeded by a competitor who successfully challenges the trustee in a race for the Cup. Unless otherwise agreed by the parties, the terms of the challenge are specified in the deed. The relevant provisions of the deed provide: This Cup is donated upon the condition that it shall be preserved as a perpetual Challenge Cup for friendly competition between foreign countries.

Any organized Yacht Club of a foreign country * * * shall always be entitled to the right of sailing a match for this Cup, with a yacht or vessel propelled by sails only and constructed in the country to which the Challenging Club belongs, against any one yacht or vessel constructed in the country of the Club holding the Cup.

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The competing yachts or vessels, if of one mast, shall be not less that forty-four feet nor more than ninety feet on the load waterline; if of more than one mast they shall be not less than eighty feet nor more than one hundred and fifteen feet on the load waterline.

The Challenging Club shall give ten months' notice, in writing, naming the days for the proposed races * * * * Accompanying the ten months' notice of challenge there must be sent the name of the owner and a certificate of the name, rig, and following dimensions of the challenging vessel, namely, length on load water-line; beam at load water-line and extreme beam; and draught of water, which dimensions shall not be exceeded; and a custom-house registry of the vessel must also be sent as soon as possible. Centreboard or sliding keel vessels shall always be allowed to compete in any race for the Cup, and no restriction nor limitation whatever shall be placed upon the use of such centre-board or sliding keel, nor shall the centre-board or sliding keel be considered a part of the vessel for any purposes of measurement.

The Club challenging for the Cup and the Club holding the same may, by mutual consent, make any arrangement satisfactory to both as to the dates, courses, number of trials, rules and sailing regulations, and any and all other conditions of the match, in which case the ten months' notice may be waived.

In case the parties cannot mutually agree upon the terms of a match, then three races shall be sailed, and the winner of two of such races shall be entitled to the Cup. All such races shall be on ocean courses * * * * [These ocean courses] shall be selected by the Club holding the Cup; and these races shall be sailed subject to its rules and sailing regulations so far as the same do not conflict with the provisions of this deed of gift, but without any time allowances whatever. The challenged Club shall not be required to name its representative vessel until at a time agreed upon for the start, but the vessel when named must compete in all the races, and each of such races must be completed within seven hours. * * * * Although the defending club, as holder of the Cup, is its trustee, it is nevertheless required to compete with challengers for the Cup. Nothing in the deed limits the design of the defending club's vessel other than the length on water-line limits applicable to all competing vessels, nor are the competing vessels expressly limited to monohulls. Moreover, there is no requirement that the defending vessel have the same number of hulls as the challenging vessel, or even that the competing vessels be substantially similar.

Prior to 1988, the America's Cup competitions generally were conducted under the mutual consent provisions of the deed, with the contestants agreeing upon the date, time and length of the races and, beginning in 1930, even upon the choice of vessels to be raced. Although multihull vessels were in use at the time the deed was executed in 1887 and during all the ensuing years, none ever competed for the America's Cup prior to the match at issue here. Between 1930 and 1937, the agreed-upon vessels were large ocean-going vessels known as J-boats, which subsequently became too expensive to build and maintain. Consequently, the yachting community lost interest in the America's Cup competition and the New York Yacht Club, which had successfully defended the Cup sixteen times before 1937, received no challenges for a twenty-year period thereafter. Attempting to revive interest in the competition, in 1956 the New York Yacht Club obtained a court order amending the Deed of Gift to reduce the minimum load waterline length to its present 44 feet and to eliminate the requirement that the challenging vessel sail to the match "on its own bottom", a requirement that had disadvantaged foreign challengers. These amendments allowed the competition to be conducted in yachts of the international 12-meter class, which measure 44 feet on the load waterline. Thereafter, in response to the increased interest in the competition by many challengers and with the consent of those challengers, the New York Yacht Club instituted an elimination series, conducted in these 12-meter yachts, in which the winner of the series was entitled to sail a match against the defender of the Cup. The America's Cup races were conducted in these elimination series at three to four year intervals for a period of thirty years, with the New York Yacht Club retaining the Cup until 1983 when it lost to the Royal Perch Yacht Club of Australia. Three years later, thirteen yacht clubs representing six nations competed to determine which would challenge Royal Perth for the Cup. In the finals, Stars & Stripes '87 of the San Diego Yacht Club defeated Royal Perth's defender Kookaburra III four races to none.

San Diego planned to defend the Cup in 1990 or 1991 in a 12-meter yacht, adhering to the traditional multiple challenger format. In 1987, as yacht clubs all over the world prepared to compete in that event, Mercury Bay issued a notice of challenge to San Diego, which for the first time in thirty years, deviated from the multiple challenger format as well as the tradition of holding the races in three to four year intervals. Mercury Bay demanded a match in less than a year and disclosed that it would race a yacht measuring 90 feet on the load waterline, the maximum length permitted in the deed and a size yacht that had not been built in 50 years. As most foreign yacht clubs were already preparing for a race of 12-meter yachts, they would have been unable to compete on the terms demanded by Mercury Bay; indeed, of the nineteen bids received by San Diego, Mercury Bay's was the only challenge which deviated from the traditional format. To justify its unorthodox challenge, Mercury Bay advised San Diego that it sought to compete

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in a vessel larger than those of recent matches because such a yacht, by "utilizing technology outside any class or rating rule would be most likely to offer real opportunity of innovative design to the benefit of yachting at large".

San Diego announced that the terms of the challenge were unacceptable under the Deed of Gift and notified other challengers that the next match would be held in 1990 or 1991 in 12-meter yachts. Mercury Bay commenced an action in New York Supreme Court seeking a declaration of the validity of its challenge, and a preliminary injunction prohibiting San Diego from considering any other challenges until Mercury Bay's challenge was decided.

In its capacity as trustee of the America's Cup, San Diego commenced an action pursuant to EPTL 8-1.1(c)(1), seeking interpretation or amendment of the Deed of Gift to authorize a continuation of the traditional 12-meter yacht elimination series format employed by both the New York Yacht Club and the Royal Perth Yacht Club, the only two prior trustees. The Attorney General of the State of New York, which represents the beneficiaries of charitable trusts under EPTL 8-1.1(f), supported San Diego's position in both actions.

Supreme Court rejected San Diego's application to interpret or amend the Deed of Gift and granted Mercury Bay's motion for a preliminary injunction, declaring the notice of challenge valid. The court held that San Diego's options were to "accept the challenge, forfeit the cup, or negotiate agreeable terms with the challenger".

Although the parties thereafter made several proposals in an attempt to negotiate agreeable terms, they were unsuccessful, and San Diego proceeded with preparations for its defense of the Cup. In late January 1988, San Diego announced its decision to race in a catamaran whose dimensions, although smaller than Mercury Bay's monohull yacht, fell within the limitations expressed in the Deed of Gift.

Mercury Bay moved to hold San Diego in contempt of Supreme Court's prior order validating Mercury Bay's challenge, arguing that the use of a catamaran, a type of vessel never before raced in an America's Cup match, would deny it the "match" to which it was entitled under the deed because the catamaran is, by design, inherently faster than a monohull vessel. According to Mercury Bay, the deed required the defending club to race a vessel which was "like or similar" to the challenging vessel. Supreme Court denied the motion and directed the parties to reserve their protests until after completion of the America's Cup races. As indicated, the match was held on September 7 and 9, 1988 and San Diego defeated Mercury Bay two races to none.

San Diego had little time to celebrate before it found itself back in court. Mercury Bay moved to have the results of the race set aside, have itself declared the winner and for an order directing that the Cup be awarded to it. Concluding that the deed implicitly required the America's Cup race to be held only between vessels which were "somewhat evenly matched" and that San Diego's use of a catamaran constituted an attempt to "retain the Cup at all costs so that it could host a competition on its own terms" which violated the spirit of the deed, Supreme Court disqualified San Diego's catamaran, declared Mercury Bay the winner of the two races and directed San Diego to transfer the America's Cup to Mercury Bay. In reversing Supreme Court, the Appellate Division concluded that the Deed of Gift unambiguously permitted matches between "yacht[s] or vessel[s]" meeting the length specifications articulated within the deed, that San Diego's catamaran was an eligible vessel, and therefore that San Diego is the rightful holder of the America's Cup. Mercury Bay appeals by leave of the Appellate Division.

II Mercury Bay asks us to set aside the results of the 1988 America's Cup Match because, in its view, San Diego's defense of the Cup in a catamaran violated the spirit of the Deed of Gift as exemplified both by its terms and various items of extrinsic evidence. It argues that the donors of the Cup never intended to permit such a catamaran defense because a race between a catamaran and a monohull yacht is an inherently unfair "mismatch" which the monohull yacht has no chance of winning. Instead, Mercury Bay contends that the donors intended to restrict the defender's choice of vessel to the type selected by the challenger and to require further that the particular vessel used afford the challenger a chance of winning the match. Mercury Bay also argues that by sailing a catamaran to defend the Cup, San Diego breached its fiduciary duties as trustee under the Deed of Gift.

Although these arguments are clothed in the legal rubric of interpreting the "intent" of the drafters of the trust instrument and determining the fiduciary duties owed by the trustee, the gravamen of Mercury Bay's complaint is that such a race between a multihull catamaran and a monohull yacht is inherently "unfair", whether or not the donors intended to permit it. The measure of "fairness" in this regard, according to Mercury Bay and the dissenters, are standards of sportsmanship as determined by reference to practices which are presently the custom in sporting activities generally and yacht racing in particular.

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The question of whether particular conduct is "sporting" or "fair" in the context of a particular sporting event, however, is wholly distinct from the question of whether it is legal. Questions of sportsmanship and "fairness" with respect to sporting contests depend largely upon the rules of the particular sport and the expertise of those knowledgeable in that sport; they are not questions suitable for judicial resolution (see e.g., Couch v National Assn for Stock Car Auto Racing, 845 F2d 397, 403; Charles O. Finley & Co v Kuhn, 569 F2d 527, 539). As sporting activities evolve in light of changing preferences and technologies, it would be most inappropriate and counterproductive for the courts to attempt to fix the rules and standards of competition of any particular sport. To do so would likely result in many sporting contests being decided, not in the arena of the sport, but in the courts.

Moreover, the Deed of Gift governing the conduct of the America's Cup competitions contemplates that such issues of fairness and sportsmanship be resolved by members of the yachting community rather than by the courts. The deed provides that where the defending and the challenging yacht clubs have not agreed upon the terms of the match, it is to be conducted as specified in the deed and pursuant to the rules and regulations of the defending club, so long as they do not conflict with the deed. As the deed broadly defines the vessels eligible to compete in the match, it is these rules and regulations which the donors intended to govern disputes relating to racing protocol such as the fairness of the vessels to be used in a particular match.[n 1] In this case, the dispute over the eligibility of the chosen vessels should have been governed and determined by the rules of yacht racing promulgated by the International Yacht Racing Union (IYRU) and followed by the defending San Diego Yacht Club. Pursuant to these rules, an international jury referees the match and decides all protests jointly submitted to it by the parties. The international jury established to resolve all disputes arising out of the 1988 America's Cup Match was composed of five members, all IYRUcertified racing judges of vast experience and international repute, from countries other than the United States and New Zealand.

Despite Mercury Bay's repeated claims of the unfairness of San Diego's catamaran defense and notwithstanding San Diego's request that a protest be submitted to the international jury, Mercury Bay deliberately chose to keep the issue from these yachting experts, who were of course, best suited to resolve it. Having thus chosen to seek relief in a judicial forum, Mercury Bay is limited to a resolution of only the legal issues presented.

A The legal issue we must determine is whether the donors of the America's Cup, as the settlors of the trust in which it is held, intended to exclude catamarans or otherwise restrict the defender's choice of vessel by the vessel selected by the challenger. Long settled rules of construction preclude an attempt to divine a settlor's intention by looking first to extrinsic evidence (New York Life Insurance & Trust Co v Hoyt, 161 NY 1, 8-10). Rather, the trust instrument is to be construed as written and the settlor's intention determined solely from the unambiguous language of the instrument itself (Central Union Trust Co v Trimble, 255 NY 88, 93; Loch v Sheldrake Assocs v Evans, 306 NY 297, 304; Gross v Cizauskas, 53 AD2d 969, 970). It is only where the court determines the words of the trust instrument to be ambiguous that it may properly resort to extrinsic evidence (New York Life Insurance & Trust Co. v Hoyt, supra; Gross v Cizauskas, 53 AD2d at 970, supra; IIA Scott, Trusts [4th Ed] § 164.1 at 253-254). The rationale underlying this basic rule of construction is that the words used in the instrument itself are the best evidence of the intention of the drafter of the document.

Therefore, we must examine the plain language of the Deed of Gift at issue here.

Contrary to Mercury Bay's contentions, nowhere in the Deed of Gift have the donors expressed an intention to prohibit the use of multihull vessels or to require the defender of the Cup to race a vessel of the same type as the vessel to be used by the challenger. In fact, the unambiguous language of the deed is to the contrary. The deed accords a foreign yacht club "the right of sailing a match for [the America's] Cup, with a yacht or vessel propelled by sails only and constructed in the country to which the Challenging Club belongs, against any one yacht or vessel constructed in the country of the Club holding the Cup" (emphasis added). Given its plain and natural meaning, the phrase "any one yacht or vessel" requires the defender to defend in a single vessel of any type. If, as the dissenters argue, the term "any" was intended to mean "one", in the sense of limiting the defender to a defense in a single vessel (Dissent, slip opn at 22), the term would be redundant, since the very next word in the phrase so limits the defense to "one" vessel.

By limiting the defense to a single vessel, the deed ensures a "match" which will be a one-on-one competition. In this match, however, the deed expressly permits a defense by any type of yacht or vessel, and restricts the actual vessels to be used only by the length on load waterline restrictions applicable to all "competing vessels", the latter phrase again making clear the donors' intention to leave both the defender's and the challenger's choice of vessel otherwise unrestricted.

Notwithstanding the broad language of the deed, Mercury Bay argues that the donors could not have intended to permit a catamaran defense because the dimensions which the deed requires the challenger to disclose are relevant to monohull but not multihull vessels . This argument misapprehends the role of the dimensions in the competitions contemplated by the deed. Because the deed allows a challenge to be mounted upon ten months' notice, the defender of the Cup is allowed only this short time to construct a defending vessel although the challenger has had unlimited time to mount a challenge and thus may have taken years

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designing and constructing its challenging vessel. By requiring the challenger to disclose certain dimensions with its ten month notice, the deed provides the defender with notice of the vessel it will be facing and thus removes the competitive advantage which would otherwise inure to the challenger. For the same reason, the deed does not require the defender to disclose any details about its vessel until the start of the race. Thus, the challenger's disclosed dimensions, which may not be exceeded, limit only the challenging vessel, and do not restrict the defending vessel. So understood, the question of whether the dimensions themselves relate to multihull vessels is simply not relevant to the issue of whether the deed precludes a catamaran defense.

In this case, we are not presented with the issue to which Mercury Bay's arguments are relevant -- whether the required dimensions preclude the use of a catamaran by a challenger because the dimensions specified do not relate to multihull vessels and therefore do not provide the defender with the disclosure mandated by the deed. While we have no occasion to address this question, we note that the applicability of the required dimensions to multihull vessels is hotly contested by the parties before us, both of whom have submitted expert evidence supporting their respective positions.

We also reject Mercury Bay's contention that the phrase "friendly competition between countries" connotes a requirement that the defender race a vessel which is of the same type or even substantially similar to the challenging vessel described in the ten month notice. Neither the words themselves nor their position in the deed warrant that construction. Although the stated purpose of the Deed of Gift is to foster "the friendly competition between foreign countries", that general phrase does not delineate any of the specific requirements of the matches to be held. Moreover, while each match is a competition, the deed permits the competitors to both construct and race the fastest vessels possible so long as they fall within the broad criteria of the deed. Thus the defender does not become a competitor only when "the warning gun of the race goes off" (Dissent, slip opn at 11); the deed makes clear that the design and construction of the yachts as well as the races, are part of the competition contemplated. Mercury Bay's suggestion, argued explicitly below and implicit here, that the vessels must be evenly matched is belied by its own assertion that the deed permits a match between a 44 foot monohull and a 90 foot monohull -- two vessels which, although within the load waterline length restrictions in the deed and of the same type, cannot be said to be "evenly matched" given the much greater speed potential of the larger boat. Indeed, such a requirement that the vessels be "evenly matched" is antithetical to the consent provisions of the deed.

There is no point in permitting a defender to give or withhold its consent on the terms of the matches if by simply making a challenge, the challenger could force the defender to acceed to its terms. As the Appellate Division majority noted, the donors, who chose to be specific about other aspects of the match, including the load waterline lengths of the competing vessels, could have easily included an express requirement that the vessels be evenly matched but did not do so.

In our view, the phrase "friendly competition between countries" more aptly refers to the spirit of cooperation underlying the competitions contemplated by the deed. The matches were to be between yacht clubs of different countries, and the deed contemplated that they would cooperate as to the details of the matches to be held. It was in this spirit of cooperation that the competitors had, since 1958, agreed to race in 44 foot yachts. Indeed, it was Mercury Bay, not San Diego, that departed the agreedupon conditions of the previous thirty years. San Diego responded to Mercury Bay's competitive strategy by availing itself of the competitive opportunity afforded by the broad specifications in the deed.

Accordingly, we conclude that the unambiguous language of the Deed of Gift, permitting the defending club to defend the Cup in "any one yacht or vessel" within the specified range of load waterline length, does not require the defender to race a vessel of the same type or "evenly matched" to that of the challenger and does not preclude the defender's use of a catamaran. Because the deed provisions on these issues are unambiguous, we may not look beyond the four corners of the deed in ascertaining the donors' intent and therefore may not consider any extrinsic evidence on the meaning of these provisions. Consequently, we reject the analysis of the Dissent, which repeatedly resorts to extrinsic evidence to support its construction of the terms of the deed (Dissent, slip opn at 14-17, 20-21, 23-24).[n 2] Indeed because the plain language of the Deed of Gift is unambiguous , such resort to extrinsic evidence to impute a different meaning to the terms expressed is improper[n 3] (Central Union Trust Co v Trimble, 255 NY at 93, supra).

B We also reject Mercury Bay's contention that notwithstanding the plain language of the Deed of Gift, San Diego breached its fiduciary duty as the trustee of the America's Cup. We have described a fiduciary's duty as requiring "[n]ot honesty alone, but the punctilio of an honor the most sensitive" (Meinhard v Salmon, 249 NY 458, 468; see also 2A Scott & Fratcher, Trusts [4th Ed], § 170 at 113; Restatement [Second] of Trusts § 170). This strict standard is the usual and appropriate measure of a trustee's fiduciary obligations because the trustee must administer the trust for the benefit of the beneficiaries and cannot compete with the beneficiaries for the benefits of the trust corpus (2A Scott & Fratcher, Trusts [4th Ed], § 170; Restatement [Second] of Trusts § 170).

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Thus, the trustee owes the beneficiary an undivided duty of loyalty and cannot, for example, take the economic benefit of a trust (see e.g., Matter of Scarborough Properties Corp, 25 NY2d 553, 558).

Unlike the trusts in which this strict rule of undivided loyalty was developed, the America's Cup trust promotes a sporting competition in which the donors clearly intended that the trustee compete on equal terms with the trust beneficiaries.[n 4] Indeed, the trustee of the America's Cup is obligated to use its best efforts to defend its right to hold the Cup and thus to defeat the beneficiaries in the contemplated competition. It is thus inappropriate and inconsistent with the competitive trust purpose to impose upon the trustee of a sporting trust such as this one the strict standard of behavior which governs the conduct of trustees who are obligated not to compete with the trust beneficiaries.

To be sure, the trustee of the America's Cup is obligated to act in good faith and in the spirit of friendly competition by reasonably attempting to reach an accord on the terms of the matches to be held. Where that is not possible, however, the specific terms of the deed govern and the trustee must use its best efforts to compete for the Cup within the specified terms. As we have discussed, by racing a vessel which met the load waterline specifications in the Deed of Gift and which was constructed in its country, San Diego fully complied with the terms and spirit of the trust instrument. The deed placed no other restraints on the defending club's efforts to win the competition, even though the defending club was also designated the trustee. Thus there can be no argument that the trustee was obligated to construe the deed in a way contrary to its plain language. We conclude that in the context of this sporting trust, San Diego fulfilled its fiduciary obligations by reasonably trying to come to an agreement on the terms for Mercury Bay's proposed match, and failing that, by faithfully adhering to the challenge provisions in the deed.

We reject Mercury Bay's contention that San Diego was required to race a vessel of the same type as its challenging vessel because it was only in that way that San Diego could administer the trust so as to give Mercury Bay, a trust beneficiary, a "fair" competition.

This amounts simply to an argument that San Diego's conduct was "unsportsmanlike" and "unfair", issues which, as we have discussed, the Deed of Gift appropriately leaves to yachting experts.

We conclude therefore that in racing a catamaran, San Diego complied with the terms of the Deed of Gift and did not violate any fiduciary obligation owed under those terms or in the administration of the trust. Any question as to sportsmanship and fairness, such as the propriety of races between monohull and multihull vessels, are questions which the trust instrument appropriately leaves to the expertise of persons actively involved in yacht racing; they are not questions suitable for judicial resolution.

Accordingly, the order of the Appellate Division should be affirmed, with costs.

FOOTNOTES 1.

The Deed of Gift provides:

In case the parties cannot mutually agree upon the terms of a match, then three races shall be sailed, and the winner of two of such races shall be entitled to the Cup. All such races shall be on ocean courses * * * * [These ocean courses] shall be selected by the Club holding the Cup; and these races shall be sailed subject to its rules and regulations so far as the same do not conflict with the provisions of this deed of gift, but without any time allowances whatever [emphasis added] In light of this plain language, and the undisputed fact that the applicable rules of the San Diego Yacht Club provide that an IYRU jury was to resolve protests arising out of the match, the fact that amicus curiae argue that the courts should resolve the question of the propriety of San Diego's defense (see Dissent, slip opn at 8-9) is simply irrelevant. This Court may properly determine only the legal issues with which it is presented.

2. Nor is it appropriate to our judicial function to rely in our analysis upon the various views expressed in the media as to the merit of

the contentions of these litigants.

3. The fallacy of this approach is demonstrated by the writings in this case. The dissenters, agreeing with Supreme Court, read

selected portions of various items of extrinsic evidence to support their position. A majority of the Appellate Division, however, upon reviewing that same extrinsic evidence, reached precisely the opposite conclusion (see Mercury Bay Boating Club, Inc v San Diego Yacht Club, 150 AD2d 82, 93-95). Thus contrary to the view taken by the dissenters, the extrinsic evidence is neither unassailably consistent nor dispositive and should not be read to contradict the plain language of the trust instrument itself.

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4. While there is authority for the proposition that trusts created for the purpose of promoting sporting events are not true

charitable trusts (see Restatement [Second] of Trusts, § 374 at 262; 2A Scott & Fratcher, Trusts [4th Ed] § 374.6A at 227-228; In Re Nottage, 2 Ch 649 [England 1895] [trust to promote the sport of yacht racing is not a charitable trust]), no one has disputed the characterization of this trust as a charitable trust.

WACHTLER, Ch. J. (Concurring): I concur in Judge Alexander's explication of the governing legal principles and his application of them to the facts of this case. While his opinion leaves little room for addition or doubt, in view of the dissent a brief comment about the courts' role in this dispute is necessary.

This case has little or no significance for the law, but it has caught the public eye like few cases in this court's history. Much of the reason for this attention, apparently, is the supposition that here at stake are grand principles -- sportsmanship and tradition -pitted against the greed, commercialism and zealotry that threaten to vulgarize sport. In the end, however, the outcome of the case is dictated by elemental legal principles.

I am in full agreement with the court's resolution of this dispute pursuant to those principles. Just as nothing in the America's Cup Deed of Gift prohibited Mercury Bay's unorthodox challenge, which successfully eliminated all other challengers, nothing in that instrument prohibited San Diego's unorthodox defense, which was equally successful. The case should end there.

The dissent, however, would have us go beyond the provisions of the trust instrument and, in the interest of sportsmanship and tradition, impose a duty on the defender to -- well, to do just what? To not try too hard to win, it seems. To choose a vessel, not for its potential to win, but for its potential to lose. There is no legal basis for the imposition of such a duty.

More important, perhaps, is that the standard articulated by the dissent would encourage repetition of the most distasteful innovation of all in this case -- resolution of the competition in court. If the defender were legally bound to choose a vessel that would ensure a "close" race with the challenger, no defender could be secure in victory without a court order attesting to the fact that it had not won too easily.

It is tempting, of course, to confuse our authority to construe the trust instrument with a license to mold the America's Cup competition in accord with our notions of sporting ideals. Ultimately, however, it must be the contestants, not the courts, who define the traditions and ideals of the sport. No one wishes to see the competition debased by commercialism and greed. But if the traditions and ideals of the sport are dependent on judicial coercion, that battle is already lost.

HANCOCK, JR., J. (dissenting): The San Diego Yacht Club and Sail America Foundation said they would meet New Zealand on the water in a three-race series for the America's Cup. But, San Diego officials also said they believe they have the right to set up conditions they think will make it virtually impossible for New Zealand to win (San Diego Tribune, Dec. 3, 1987 [emphasis added]).[n 1] This newspaper comment frames the issue before us: was San Diego[n 2] faithful to its responsibilities as trustee under the New York State America's Cup charitable trust in contriving a catamaran defense for the express purpose of turning the sailing competition into a mismatch and aborting New Zealand's[n 2] lawful challenge?

This is not a dispute over whether the contest between the monohull and the catamaran was a fair match. It clearly was not.[n 3] San Diego never intended that it should be. It conceded this point by virtually proclaiming a victory before the start of the races. Indeed, Sail America's President, Malin Burnham, publicly acknowledged in December 1987 that "the speed difference between a large multi-hull and any size monohull would turn this race into a farce" (emphasis added).[n 4] From the record, there can be no doubt that San Diego chose the catamaran to race against the monohull for one reason: to be certain that there could be no reasonable possibility of losing. Its purpose was plain -- to make sure that it retain the America's Cup so that it could proceed with its plans for the 12-meter competition planned for 1990 or 1991 in San Diego.[n 5] But, that San Diego concededly construed the Deed of Gift to permit its catamaran defense for the purpose of nullifying the New Zealand challenge does not, without more, end the matter. All agree that the issue is not that simple. The question is whether it was permissible for San Diego to do this. Could San Diego make this construction of the deed, as allowing a catamaran in order to

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foreclose any possibility of a New Zealand victory, without violating the terms of its trust and thwarting the donors' very aim in establishing the trophy: viz., that "it shall be preserved as a perpetual Challenge Cup for friendly competition between foreign countries" (emphasis added)? Can it be consistent with the duties of a holder and defender as trustee of the America's Cup to meet a lawful challenge by a monohull with a catamaran for the express purpose of avoiding the very competition which the gift of the cup was intended to promote?

A majority of the court concludes that San Diego's conduct was not in breach of the trust obligations it expressly assumed under the Deed of Gift when it accepted the cup. It adopts the argument that because there is no express language stating that a yacht must be a monohull and because the Deed of Gift refers to the yacht selected to defend against a challenger as "any one yacht or vessel", the author of the Deed of Gift could not have intended to exclude a catamaran. Defending with a catamaran comes within the literal terms of the Deed of Gift, the majority says, and, for that reason, it concludes that San Diego has remained faithful to its trust. We disagree.[n 6] The cup donors -- the record clearly shows -- never conceived of a catamaran as a vessel that might be entered by either a challenger or defender in America's Cup competition. But, that aside, it is unthinkable that the donors could ever have intended that the trophy holder and defender could construe the Deed of Gift in its favor for the express purpose of creating a mismatch to retain the trophy, thereby subverting the very purpose of their gift in trust. We therefore dissent. We would declare the September 1988 races to be nullities but permit San Diego to have a rematch, if it is so minded, in lieu of forfeiting the America's Cup by default.

I There must be no confusion about New Zealand's contentions or the precise issue before us. Whether San Diego's conduct in construing the Deed of Gift so as to fix in advance the outcome of the races could, as an abstract matter of ethics, be deserving of approval is, of course, not the central point. The real question, as the majority repeatedly reminds us, involves established rules of New York trust law. Was San Diego's unilateral construction of the Deed of Gift to permit a catamaran defense consistent with the trust obligations it agreed to undertake as the custodian of the trophy? This is the precise issue.

It is to resolve this central point and to ascertain the intent and purposes of the donors in establishing the express condition of their gift that the dominant concept of a fair match on equal terms -- which is evident in the Deed of Gift and so thoroughly permeates the 130-year history of America's Cup competitions -- becomes highly relevant. For it is within the sport of international yacht racing that this charitable trust was created by the experienced yachtsmen who first won the trophy in 1851 by defeating a fleet of British yachts in a race around the Isle of Wight. No one suggests (see Majority Opn, pp 9-10, 19-20; Concurring Opn, p 2) that it would be appropriate for the courts to attempt to mediate disputes concerning racing rules or standards of what is fair or appropriate in the actual conduct of yacht races. But certainly the long-accepted general notions of fair competition in yacht racing -- and, indeed, the obvious point that sailing two mismatched boats against each other is not a race but a pointless exercise -- are significant. They help to determine what the yachtsmen who established the trust had in mind in donating the America's Cup "upon the condition that it shall be preserved as a perpetual Challenge Cup for friendly competition between foreign countries" (emphasis added).

And let there be no mistake about this. Contrary to the implications of the majority (pp 6-7, 16) and concurring (pp 1,2) opinions, the dispute is not about the propriety of New Zealand's conduct in issuing its challenge. Supreme Court, in a prior proceeding, held that the 90-foot monohull fully conformed with all requirements of the Deed of Gift. In the same proceeding, Justice Ciparick dismissed any suggestion that New Zealand should have adhered to the recent pattern of 12-meter competitions and rejected San Diego's efforts to have the Deed of Gift amended to reflect such requirement (see, Mercury Bay Boating Club Inc. v San Diego Yacht Club, Dec of Ciparick, J. [dated 11-25-87], [CA 72, JA 821, CA 81-82, JA 830-831]). Justice Ciparick, in her decision, noted, moreover, that although "San Diego has declined to negotiate with the challenger, Mercury Bay expresses its willingness to participate in a multinational elimination series, in 1988 using ninety footers, for the right to challenge for the cup and to negotiate other terms".

(Emphasis added.) San Diego chose not to appeal Justice Ciparick's rulings. The challenge by New Zealand was unquestionably proper in every respect.[n 7] Finally, before turning to the merits of the appeal, a comment must be made concerning one other point raised by San Diego. It argues (and the majority appears to give the argument some credence [Slip Opn, pp 10-12, 19-20]) that the dispute over interpretation of the Deed of Gift should have been referred to an international jury of "IYRU-certified racing judges of vast experience in international repute" (id. at 11) and that the propriety of races between monohulls and multi-hulls vessels is not a question "suitable for judicial resolution" (id., at 20). There is simply no support for this argument in the Deed of Gift or elsewhere.

The suggestion that a jury of yachtsmen would be the appropriate forum for deciding a question pertaining to the construction of a trust instrument established under New York's Charitable Trust Law is, we believe, best answered in the legal brief submitted jointly

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on behalf of the 12 amici curiae, eight renowned yachtsmen from the United States, Great Britain and Australia and four yacht clubs of unquestioned standing:[n 8] First, it is important to bear in mind that the issue here is not whether one vessel or another cut inside or outside a marker. The courts are not being asked to decide whether a foul was committed or to second guess on-the-spot officials by affording the loser a judicial "replay" of a particularly close finish. Such issues are and should be left to the yachting officials. The issue in this case goes to the fundamental nature of the America's Cup competition and calls for a judicial construction of a trust instrument which SDYC accepted with the express understanding that the "Deed of Gift shall be governed by, and construed in accordance with" the laws of New York and that "any proceeding for amendment or interpretation of such terms and conditions [would] be brought before the courts of the State of New York." (Amici Brf, p 25, n 11) (emphasis added).

II The holder and defender of America's Cup acts as a trustee. In setting the time and place for the races, in establishing the rules, the courses and other conditions for the competition and in construing the Deed of Gift to decide upon a proper boat to meet the challenger, the defender must act in all respects with nothing less than irreproachable fairness. A defender owes a duty as trustee to any yacht club which may file a challenge against it. But it owes a duty as well to past defenders and trustees of the America's Cup, those who have engaged in America's Cup competitions and to interested members of the international yacht racing community. All have a legitimate concern that an America's Cup challenge be administered in a way that is fully consistent with the underlying concept of maintaining "a perpetual Challenge Cup for friendly competition between foreign countries".

The standards governing the conduct of an America's Cup defenders are those which apply to trustees generally. The classic statement of the standard is that of Chief Judge Cardozo in Meinhard v Salmon (249 NY 458, 464)(quoted by the majority [Slip Opn, p 17-18]), "[n]ot honesty alone, but the punctilio of an honor the most sensitive" (see generally, Restatement, Second, Trusts § 170; IIA Scott on Trusts [4th ed] §§ 170, 170.25). But, as with any legal duties involving standards of ethics and integrity, it is difficult to define the defender's responsibilities as trustee in other than general terms. There are, nevertheless, aspects of the defender's role as trustee which are particularly instructive. First, of course, the defender's duty as trustee arises in a sport -- a context totally foreign to the circumstances where "the morals of the marketplace" prevail (see, Meinhard v Salmon, supra at 464). As put by A. Bartlett Giamatti, "the basic convention for any game is the assumption of a level field, that all begin as equals, above board.

Without that convention, there is no contest. * * * The highly moralized (because rule bound) world of any sport is very fragile in the face of the amoral quest for betterment, the hunger to win at any cost, even at the cost of destroying the game * * *".[n 9] Second, the defender's role is made more sensitive and its actions subjected to a stricter scrutiny because it is a competitor as well as a trustee (see, IIA Scott on Trusts [4th ed] § 170.25 ["a trustee occupies a position in which the courts have fixed a very high and very strict standard for his conduct whenever his personal interest comes or may come into conflict with his duty to the beneficiaries" (emphasis added)]; see generally, Restatement, Second, Trusts, § 170). In managing the race, construing the Deed of Gift and selecting a proper defending boat the defender is a trustee. Once the first warning gun of the race goes off, the trustee becomes a competitor. The decisions which the defender makes as trustee will obviously affect the ensuing competition, even predetermine it. It would, at the very least, be contrary to the accepted standards of ethics in any sporting event for a competitor, in a position to make a unilateral rule interpretation affecting his opponents' competitive positions, to bend the rule or stretch the language to virtually assure victory for himself.

It is on the dual role of the America's Cup holder as first a trustee and then a competitor that we have a sharp disagreement with the majority. The majority view, apparently, is that the holder-defender in deciding upon a proper boat to meet a challenge is perfectly free, in its role as a competitor, to adopt an adversarial approach in construing the Deed of Gift for the purpose of defeating the challenge without the constraints of its trust obligations.[n 10] Thus, it concludes that San Diego's "anything goes" policy in giving the Deed of Gift its narrow reading so as to make New Zealand's victory "virtually impossible" was proper. The majority's conclusion is based on a proposition of law for which no precedent has been found.

Although agreeing that Meinhard v Salmon (249 NY 458) states the rule (Slip Opn, pp 17-18), the majority fails to follow it. Instead, it holds that it is "inappropriate and inconsistent with the competitive trust purpose to impose upon the trustee of a sporting trust such as this one the strict standard of behavior which governs the conduct of trustees who are obligated not to compete with the trust beneficiaries" (id. at 18-19 [emphasis added]). No authority is cited for this proposition. But, that aside, the America's Cup trust is not a so-called "sporting trust" (compare examples of false charitable trusts for "the mere promotion of sports" [IV A Scott on Trusts (4th ed) § 374.6(a); Restatement, Second, Trusts § 374, p 262]). There is no question that the America's Cup trust is a valid New York charitable trust. Indeed, the majority points out that no one disputes this (Slip Opn, p 18, n 4). Nevertheless, the majority

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offers no explanation of why, in assessing the conduct of this trustee, there should be any deviation from the general rules which would otherwise apply -- particularly the rule fixing the very strict standard when the trustee's own interest comes into conflict with the duty owed to the beneficiaries (see, IIA Scott on Trusts [4th ed] § 170.25).

The provisions of the trust, contained in the amended Deed of Gift of October 24, 1887 signed by Mr. George Schuyler -- in three explicit instructions --leave no doubt as to the purposes for which the holder and defender of America's Cup must carry out its responsibilities (see generally, Restatement, Second, Trusts § 164, comment a; IIA Scott on Trusts § 164.1). Two of these instructions are set forth in the key sentence expressing the condition of the gift: The Cup is donated upon the condition that it shall be preserved as a perpetual challenge cup for friendly competition between foreign countries (emphasis added).

The condition of the gift has two components: (1) that the cup "shall be preserved as a perpetual Challenge Cup" and (2) that it be preserved "for friendly competition between foreign countries". The words "shall be preserved" are mandatory, not precatory (see, McKinney's Statutes, § 171; Spencer v Childs, 1 NY2d 103, 106-109). It seems self-evident that a defense of the cup which is calculated to circumvent a lawful challenge and to avoid any competition would flatly contradict these two instructions.

The third instruction is that a challenger "shall always be entitled to the right of sailing a match for this Cup" (emphasis added).

Again, the language is mandatory, and again, it seems self-evident that a defender cannot act deliberately to prevent "a match" without violating this unequivocal mandate.

There exists compelling evidence of how the original donors intended that the Deed of Gift should be interpreted and the trust carried out. In a letter dated April 15, 1871, George Schuyler, an original America's Cup donor and the signer of the 1887 amended Deed of Gift, ruled that the Deed of Gift did not permit a defending yacht club to defend against a challenge by racing a fleet of yachts against a challenger's single yacht. The ruling was made in connection with a rematch against the New York Yacht Club sought

by Mr. James Ashbury of the Royal Thames Yacht Club. Mr. Ashbury's first challenge in 1870 in his yacht "Cambria" had been met by the New York Yacht Club with a fleet of 14 defending yachts. "Cambria" had finished l0th. In connection with his 1871 challenge Mr. Ashbury sought a ruling -- which the New York Yacht Club opposed -- that a "fleet defense" would not be permitted and that the race would, instead, be one-on-one (see Affdvt of James Michael, Appdx, Vol II CA 843-845, JA 2292-2294; John Rousmaniere, The Mismatch Question and the America's Cup, CA 766, JA 2056). Although there was nothing in the Deed precluding such a "fleet defense", Mr. Schuyler left no doubt that the instrument would not permit what he viewed as an unacceptable effort by the defending New York Yacht Club to retain the America's Cup at all costs. Mr. Schuyler stated: It seems to me that the [position of the New York Yacht Club] renders the America's trophy useless as "a Challenge Cup" and that for all sporting purposes it might as well be laid aside as family plate. I cannot conceive of any yachtsman giving six months' notice that he will cross the ocean for the sole purpose of entering into an almost hopeless contest for this Cup (emphasis added) (Letter of George Schuyler, Spirit of the Times, April 15, 1871). (CA 514, JA 1318).

In resolving the controversy and holding that the Deed of Gift contemplated only a "one-on-one" competition -- despite the absence of any limiting language -- Mr. Schuyler held that "match" means "one side against the other side" (CA 507, JA 1311). But, significantly -- although not necessary to settle the precise dispute before him -- Mr. Schuyler set forth his complete definition of "match" in which he included the underscored words which follow: but the cardinal principle is that, in the absence of all qualifying expressions, "a match" means one party contending with another party upon equal terms as regards the task or feat to be accomplished" (emphasis added).

These words -- of critical importance in the instant controversy -- can mean only that, in Mr. Schuyler's mind (and in the minds of the original donors), a race to be considered a "match" as contemplated in America's Cup competition would have to be one which was fair and on equal terms.

That the notion of a fair match on equal terms is inherent in the concepts of a "Challenge Cup" and "friendly competition between foreign countries" is confirmed by the history of America's Cup races. In the 26 matches conducted since the original gift in 1857, the competing yachts have borne a close resemblance to each other with each vessel having a reasonable chance to win. In all of the races until 1988, the defenders and challengers have been monohulls. With the exception of the challenge in 1870 (the year of the controversial "fleet defense" victory over the British yacht "Cambria"), the defenders and the challengers have been of virtually the same length on the water-line.[n 11] Again, in 1887, George Schuyler -- in his handling of another problem that had arisen in connection with a challenge -- underscored the dominant theme of his 1871 letter: that the governing principle of America's Cup competition is fairness, that a race between a

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challenger and defender for the "Challenge Cup" should be a fair match on equal terms. When the Scottish challenger "Thistle" arrived in New York for her challenge against the New York Yacht Club, it measured l.4 feet longer on the water-line than had been represented, giving it a speed advantage over the defending yacht which had been built to match the shorter length. Although George Schuyler chose not to disqualify "Thistle", he gave her a time handicap to make it a fair match on equal terms.

In 1890, another noted New York yachtsman reemphasized the recurring theme of fairness. Joseph Busk, who had served on the New York Yacht's Club America's Cup committee, in explaining the 1887 Deed of Gift in reply to a letter from the Earl of Dunraven which had criticized it, wrote: In drawing the new rules the idea was to eliminate, as much as possible, the chance of the Cup being won or held by trick, device or surprise and to make it a trophy to be run by fair sailing in a match between the best representative boats that could be produced by either side (CA 787, JA 2077).[n 12] (Emphasis added.)

III It is basic that a trustee is legally bound to carry out its trust solely for the interests of the beneficiaries (see, Restatement, Second, Trusts § 170[1]; IIA Scott on Trusts § 170). Ordinarily a court will not inquire into the motives of the trustee. But, if it is shown that its motives were improper the court will intervene. Thus, "if the trustee in exercising or failing to exercise a power does so because of spite or prejudice or to further some interest of [its] own or a person other than the beneficiary, the court will interpose" (Restatement, Second, Trusts § 187, comment g, p 404 [emphasis added]; see, Matter of Bruches, 57 AD2d 456, 462; IIA Scott on Trusts [4th ed] § 170.25). It is in the light of these rules that San Diego's conduct as trustee must be examined.

In deciding whether San Diego has acted properly in construing the Deed of Gift to permit its catamaran defense, we must not analyze the language as if it were contained in a contract drawn between two parties dealing at arm's length. We must construe the Deed of Gift as a trustee should construe it. The question is whether San Diego -- charged with acting solely for the interest of the beneficiaries and not for its own interests -- has fairly and objectively construed the language of the Deed of Gift.

The question is not the hypothetical one of whether under any circumstances a catamaran could be permitted -- e.g., whether a challenger could test the Deed of Gift by making a challenge with a catamaran. The challenging yacht club is not a trustee; only the defending yacht club is. Only the defender must act with the objectivity required of a trustee. Thus, resolution of the decisive issue -whether the Deed of Gift has been properly construed -- depends not on whether the Deed of Gift can be read to encompass a catamaran but on whether San Diego, as trustee, ought to have read it that way. In other words, could San Diego give it its literal and narrow construction so as to permit itself to defend with a catamaran against a monohull without violating the trust?

Forget, for the moment, the defender's obligations as trustee and ignore everything in the Deed of Gift except the FIFTH and SIXTH paragraphs dealing with yacht dimensions and notice requirements. Even then, the conclusion is inescapable that a catamaran as a putative America's Cup contender could not have been contemplated. The only dimension restriction is one that can have no relevance to a catamaran: length on the load water-line (not less than 44 feet, nor more than 90 feet for a single masted yacht). No one can seriously dispute the proposition that water-line length serves as a rough measure for the hull speed of a monohull sailing vessel, but does not do so for a catamaran. (See supra n 11, p 16 regarding rule-of-thumb -- hull speed in knots of monohull equals square root of twice load water-line length in feet.)

For many reasons, this relationship of water-line length to hull speed does not apply to catamarans. For example, the twin hulls of the catamaran can be long, narrow and widely spaced. Because it can achieve its necessary stability from the wide-spacing of its two hulls, a catamaran can be much lighter than a monohull (e.g., 75,000 pounds for monohull "New Zealand" as contrasted with 6,000 pounds for the catamaran "Stars and Stripes"). And because of their long, narrow shape, the two hulls create considerably less wetted surface than would be the case for a comparable monohull. The result is that the catamaran has a vastly superior power to weight ratio, and far less drag. Also, of course, a catamaran has the additional advantage of being able, under certain conditions, to lift one hull from the water (i.e., to "fly a hull"), thereby reducing drag even further and increasing speed.[n 13] But the very facts in this case provide the ultimate proof of the proposition that the general relationship between load water-line and hull speed does not hold true for catamarans. San Diego, knowing that "New Zealand" measured 90 feet on the load water-line, built a catamaran of 60 feet, 30 feet shorter, yet was assured that the race would be "no contest". The catamaran's speed potential was estimated at more than 22 knots.[n 14] Applying the monohull rule-of-thumb to the 60-foot catamaran produces the figure 10.95, a mathematical result without any nautical, physical or other significance.

The requirements in the 1887 amended Deed of Gift, signed by Mr. Schuyler, that the challenger must give the defender ten months' notice of its load water-line length and that the challenger's yacht may not exceed that length (reflecting Mr. Schuyler's experience

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in the "Thistle" controversy) serve the obvious purpose of giving the defender definite and binding advance notice about the challenger's speed so that it can construct a defending yacht of comparable size and capability. Indeed, George Schuyler, in his letter of September 24, 1887 referring to the "Thistle" controversy, emphasized the great "importance of accuracy in giving the dimensions [i.e., water-line length] of a yacht challenging for the Cup" (emphasis added) (Appdx CA 1004, JA 2562). But there would have been no "importance" if catamarans were permitted. The requirement for specification and notification of load water-line would have had no meaning if considered applicable to catamarans. It can hardly be thought that Mr. Schuyler, a lawyer and yachtsman of unquestioned competence, would have sanctioned the drafting of a provision which could have served no purpose.[n 15] Another provision in the 1887 Deed of Gift specifically permits "centre-board or sliding keel vessels" and prescribes that there be no limitation "upon the use of such centre-board or sliding keel" and that "the centre-board or sliding keel" shall not be considered a part of the vessel for measurement purposes. It is a reasonable inference from the fact that "centre-board or sliding keel" is invariably referred to in the singular that the drafter had in mind a vessel with one hull, using one centre-board or sliding keel, not a catamaran having two hulls and two centre-boards or sliding keels.

San Diego, in dismissing what, at the very least, are compelling signs that only monohulls were contemplated, relies almost entirely on the reference in the October 24, 1887 amended Deed of Gift to the defender's yacht as "any one yacht or vessel constructed in the country of the Club holding the Cup" (emphasis added). In its argument, San Diego rejects the primary meaning[n 16] of the word "any" and the sense in which it clearly appears Mr. Schuyler, who added it, intended that it be understood -- i.e., as limiting the defending yacht club to a defense by only "one" yacht as opposed to more than one (see discussion infra, pp 14-15). Instead, San Diego adopts a secondary meaning[n 17] of "any" and reads the word as signifying that there should be no limit on the types or kinds of yachts or vessels chosen to meet a challenger and that Mr. Schuyler, therefore, must have intended that the phrase "against any one yacht or vessel" be read broadly to include catamarans.

Nothing in the Deed of Gift or its history suggests that Mr. Schuyler thought that the word "any" would ever be understood as having some relation to the types or kinds of vessels or that the word would be given a meaning other than its primary one. On the contrary, the history of the amendment of the Deed of Gift shows conclusively that San Diego's construction is wrong. Mr. Schuyler used the word "any" -- juxtaposed in the added phrase with the word "one" -- in its primary and restrictive sense to mean one yacht or vessel as opposed to more than one. The phrase "against any one yacht or vessel" (emphasis added) was added by Mr. Schuyler solely to assure that future America's Cup defenses would be in a single yacht, thus preventing any possibility of another attempted "fleet defense" of the type the British challenger "Cambria" had been forced to meet in 1870. (See supra, at 14-15; Letter of George Schuyler, Spirit of the Times, Apr. 15, 1871, CA 505, 514, JA 1309, JA 1318.)[n 18] San Diego goes to great lengths to make it appear that in this country in the late 19th century catamarans were customarily accepted as competitors in ocean yacht racing. The unrefuted record demonstrates just the contrary. Catamarans were small, largely experimental and certainly not generally accepted in established yacht races. Indeed, the research reveals that only 48 catamarans existed in this country between 1820 and 1890. (See Affidavit of Daniel Charles, CA 590-598, JA 1491-1499.)[n 19] What is clear, moreover, is that catamarans were never considered in connection with America's Cup races. Indeed, in the 19th century they were too small and not sufficiently seaworthy to make the open ocean voyage which would ordinarily be required to get to the site of the race.[n 20] It adds nothing to note (Majority Opn, p 15) that the dimension specifications in the Deed of Gift would theoretically permit the absurd spectacle of a 44-foot monohull racing against a much faster 90-foot monohull. Obviously, the argument is not germane to the question of whether the Deed of Gift permits a catamaran. Beyond that, if the point is that the Deed of Gift would permit a defender to assure its victory by overwhelming a smaller monohull with a larger and faster monohull, the argument overlooks the point that the defender is trustee. One could hardly suggest that such conduct would promote "friendly competition between foreign countries". The history of America's Cup, of course, proves that such an obvious mismatch created by a defender would never have been tolerated.[n 21] The foregoing (and the balance of the evidence in this voluminous record), we are convinced, establishes that the Deed of Gift, in its original and amended forms, contemplated only monohulls. But, even if that issue were much closer than we believe it to be, the critical question would remain. Did San Diego, in resolving the disputed issue in its own favor, adhere to the "very high and very strict standard [which the courts have fixed for the conduct of a trustee] whenever [its] personal interest comes or may come into conflict with [its] duty to the beneficiaries"? (emphasis added) (IIA Scott on Trusts, [4th ed], § 170.25). We believe that, based on facts in the record which are either conceded or not seriously controverted and on established rules of New York trust law, the answer must be "no". The following analysis demonstrates why.

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Under settled principles of trust law (see e.g., Restatement, Second, Trusts § 187, comment g, p 403), it would ordinarily follow that San Diego's construction of the Deed of Gift for its own purposes so as to permit a catamaran defense would make it liable for breach of its trust. San Diego argues, however, that the fact that it acted for its own interests is irrelevant because its construction of the Deed of Gift was unquestionably correct. In effect, it contends that it did the right thing, although, perhaps, for the wrong reasons. This is obviously its posture in contending that the "any one yacht or vessel" clause gives it a total license as to the type of vessel and that it, therefore, had the absolute "right to set up conditions [it believed would] make it virtually impossible for New Zealand to win" (emphasis added) (comment, San Diego Tribune, Dec. 3, 1987, supra, at 1; see similar comments and expressions in footnotes 3,4 and 5 supra at 2-3).

Thus, the question ultimately comes to this: was San Diego's choice of the catamaran a cut-and-dried decision made as a matter of routine? Is San Diego correct in construing the Deed of Gift as giving it the power to stifle any chance of a New Zealand victory by choosing a catamaran defense? In no sense, regardless of any of San Diego's arguments on the Deed of Gift, was the question cutand-dried or the choice a matter of routine. Under any reasonable view, San Diego would have to concede the existence of ambiguity in the Deed of Gift on the question of permitting a catamaran defense and substantial doubt as to the correctness of its construction. At the very least, the decision required San Diego to exercise reasoned judgment which "could typically produce different acceptable results" (Tango v Tulevich, 61 NY2d 34, 41) -- i.e., a judgment, as trustee, that was quasi-judicial in nature.

Because, as trustee, it could make decisions of competitive advantage to itself and disadvantage to challenger-beneficiaries, it was bound to adhere to the "very high and very strict standard" which the law imposes (see, IIA Scott on Trusts [4th ed], § 170.25).

San Diego, in making a rigid and overly literal construction of the Deed of Gift, did so for its own interest and contrary to the interests of the beneficiaries. San Diego, therefore, violated its duty as trustee under the Deed of Gift in defending with a catamaran, and should not have been declared the winner of the two races.

IV At the root of this appeal, we submit, is a fundamental disagreement as to the standards by which San Diego's conduct as trustee should be measured. San Diego has obviously applied the standard "of the marketplace" (Meinhard v Salmon, supra at 464) in assuming, as it did, that it was completely justified in adopting an "anything goes" interpretation of the Deed of Gift for the purpose of making it "virtually impossible for New Zealand to win". Thus, without hesitation, San Diego has adopted a literal construction of the "against any one yacht or vessel" clause. It has consistently approached the case as though it involved a dispute over the meaning of a business contract made between two parties at arm's length. San Diego's attitude, we believe, is epitomized in a statement given by Dennis Conner to Life Magazine concerning his assessment of America's Cup competition: Sportsmanship is nonexistent. This isn't tiddlywinks; it's business * * * there has never been any sportsmanship in the America's Cup. Anyone who thinks so is kidding himself. (Article, NO MATCH America's Cup 1988, CA 971, JA 2515 [quoting Life Magazine, September 1989]).[n 22] There are certainly those who, like Mr. Conner, believe that America's Cup has become a business, even one debased by "greed, commercialism and zealotry" (see Concurring Opn, p 1). Perhaps, the reality is that it has come to that. Still, there are those who believe that America's Cup remains and should remain a sporting event in the accepted tradition where "identical conditions and norms [are imposed] upon play, [and] the essential assumption of all the rules is that skill or merit * * * will win out" (Giamatti, Take Time for Paradise: Americans and Their Games, Summit Books 1989, p 60). Whether the more cynical assessments of America's Cup are correct is for the yacht racing community and public to decide.

But, irrespective of one's attitude toward America's Cup competition, one thing is certain: the standards of "the marketplace" cannot be the measure of San Diego's conduct as defender and as a trustee under New York law. San Diego and New Zealand cannot be viewed as parties who are in dispute over some terms in a bargained-for agreement. One is a trustee, the other is not. It is the law of trusts which applies, not the law of contracts.

It is this critical aspect of San Diego's role as holder and defender of America's Cup and its attendant obligations as trustee which the Attorney General overlooks in his criticism of the trial court for her application of a "different standard in assessing the propriety of San Diego's defense than it did in evaluating Mercury Bay's initial Notice of Challenge" (emphasis added) (Brf, Attorney General, p 28). Indeed, the majority rejects this same crucial distinction in its comment that because San Diego considered New Zealand's monohull to be "unorthodox", San Diego's conduct was fully justified when it "responded to Mercury Bay's competitive strategy [i.e., its legal monohull challenge] by availing itself of the competitive opportunity afforded by the broad specifications in the deed". (Slip Opn, p 17) (Emphasis added.)

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But, Justice Ciparick was quite correct in holding San Diego to the higher standard in "assessing the propriety of [its] defense", for only San Diego was a trustee. When it won the America's Cup at Freemantle in February 1987, San Diego formally agreed to accept it in trust pursuant to the following provision in the Deed of Gift: [San Diego] hereby accepts the said Cup subject to the said trust, terms, and conditions, and hereby covenants and agrees to and with the said party of the first party that it will faithfully and fully see that the foregoing conditions are fully observed and complied with * * * (emphasis added).

Judge Titone and I would "impose a duty on the defender to -- well, to do just what?", the concurrer asks (Concurring Opn, p 2). This question as to San Diego's duty is, of course, the critical one. We think it has been clearly answered. As trustee under the Deed of Gift, San Diego had the legal duty to meet the "very high and very strict standards" which the law imposed upon it because, in its dual role as competitor and trustee, its interests were in conflict with the interests of the beneficiaries, including the challenger (see, IIA Scott on Trusts [4th ed] § 170.25). It is this duty which San Diego ignored in adopting a strictly literal reading of the "any one yacht or vessel" clause to sanction its choice of a catamaran and assure New Zealand's defeat.

V There remains the question of appropriate relief. In our opinion, the races held on September 7 and September 9, 1988 should be declared nullities. San Diego should not, however, be held to have automatically forfeited the America's Cup. The matter should be remanded to Supreme Court for the purpose of fashioning an order which would give San Diego a reasonable period of time, if it so desires, to arrange for and conduct a new series of races in which it can meet the New Zealand challenge in a defending yacht or vessel which complies with the Deed of Gift. In the event that San Diego does not avail itself of this option, it should be considered to have defaulted in the face of New Zealand's lawful challenge and the America's Cup should be awarded to the Mercury Bay Boating Club, Inc. We believe this outcome is compelled, under the circumstances, by notions of fairness, considering particularly: (1) that the September 1988 races were held pursuant to an order of Supreme Court without a ruling as to the legality of the catamaran defense, and (2) that San Diego's interpretation of the Deed of Gift was approved by the New York State Attorney General.

FOOTNOTES 1. (Appdx, Vol I, CA 437, JA 1157 [cited in Mercury Bay Brf on App, p l8]).

2. "San Diego" will be used throughout to refer to San Diego Yacht Club, Inc. and to groups or individuals directly associated with it

such as Sail America Foundation, Manager of San Diego Yacht Club's America's Cup defense.

"New Zealand" will be used to refer to the challenger, Mercury Bay Boating Club, Inc., and persons or groups directly associated with it such as Michael Fay, head of the New Zealand Yachting Group and the monohull's chief backer.

3. The catamaran won the first race by two and one half miles and by 18 minutes, 15 seconds; the second race by more than four

miles, and by 21 minutes, 10 seconds. The overwhelming consensus of opinion was that it was "one of the greatest mismatches in history" (David Poe, Santana "A-Cup XXVII", Oct. 1988; Appdx, Vol II, CA 959, JA 2503; see similar comment of Frank Snyder, Commodore of the New York Yacht Club, Affdvt, Appdx, Vol II, CA 755-756, JA 2045-2046). Moreover, the post race consensus was that the catamaran had not been sailed to its speed potential. David Poe who followed the catamaran in the press boat observed that "Dennis did a lot of dawdling on the race course to make it look close * * * [and that] it was obvious that Dennis was frequently pointing too high, even luffing his jib and the instant the hull came out of the water, plop back down it went" (Santana, Oct. 1988 "ACup XXVII" id., CA 959, JA 2503; see, Mercury Bay, Brf on App, pp 22-24 for similar observations, for editorial comments, and for other relevant record citations).

4. San Diego Union, Thursday, Dec. 3, 1987 (Appdx, Vol II, at CA 433, JA 1153). (See also comment of Dennis Conner, Skipper of Stars

and Stripes, made in USA Today, Sept. 9, 1988 that "[t]he catamaran is a tool to deal with the problem -- an unwanted problem" [id., CA 1037, JA 2826]; Comment of Britton Chance, a member of San Diego's Design Team: "The ability to beat the monohull with a multi-hull would not be an issue. The multi-hull is going to win every time barring bad design, bad construction or bad execution."

[Providence Journal, Dec. 23, 1987, id., Vol I, CA 441, JA 1167]).

5. Malin Burnham could not have been more frank in announcing the San Diego group's overriding objective: "If we have to race Fay

[the chief backer of the "New Zealand"] in 1988, we want to be sure we can put his challenge away with little trouble. We don't want to do anything to risk San Diego losing the 1991 series." (Sports Illustrated, Dec. 7, 1987, id., CA 331, JA 1012). (For references to additional similar comments see Mercury Bay Brf on App, p 18).

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6. The concurrence misreads the dissent as maintaining that the court should impose some undefined duty on the defender "in the

interest of sportsmanship and tradition" -- a duty "not to try too hard to win, it seems." (Concurring Opn, p 2). This is not the position of the dissent and plainly not what it says. As is fully apparent (infra, pp 5, 6), the position of the dissent is that San Diego had a legal duty as trustee of the America's Cup -- a valid New York State charitable trust -- to make a fairly considered and unbiased construction of the Deed of Gift in its selection of a defending yacht. It is whether San Diego violated this legal duty -- not some dispute over ethics in sports or racing rules or what would "ensure a 'close' race" (Concurring Opn, p 2) -- which is the central question. The position of the dissent is simply stated: San Diego violated its duty as trustee in deliberately construing the Deed of Gift for its own benefit so as to permit a catamaran defense for the express purpose of avoiding the very competition for which the donors established the America's Cup trust. There is no disagreement that "elemental legal principles" (Concurring Opn, p 1) dictate the outcome of this case. Our disagreement is over what these principles are and how they should be applied. It is the question of San Diego's legal duty under the New York law of trusts --irrespective of its importance to society or to the law as a precedent -which we must decide. It is solely this question we address.

7. San Diego, nevertheless, persists in its efforts to cast doubt on the propriety of New Zealand's conduct, suggesting that New

Zealand's departure from the 12-meter format of recent years, while concededly legal, was somehow improper. The suggestion apparently viewed with some favor by the majority (Majority Opn, pp 6,16) is surprising in view of Justice Ciparick's unappealed decision, in which she stated, inter alia, that it "is not at all clear that challenges involving 90-footers would be more expensive in racing 12-meter yachts" and that "it appears that 90-footers may be ideal in 12-meter boats ill-suited for a competition to be held in San Diego with its light winds". The suggestion is all the more surprising in view of the letter to Fred Frye, Commodore of the San Diego Yacht Club, sent by James Michael before San Diego decided on a catamaran (CA 176, JA 122; CA 177, JA 123) stating, in part, that "a match between 90-foot load water-line yachts surely comes closer to the contemplation of George L. Schuyler * * * than do 12-meters" and that such a match "could be every bit as competitive as one between two 12-meters, and very likely would be of much more world-wide interest, considering that the yachts could be expressly designed for the San Diego conditions." James Michael, among other things, is past commodore of the Cruising Club of America, past president of the U.S. Yacht Racing Association and a former trustee of the New York Yacht Club who served on its America's Cup committee from 1971 to 1983.

8. The four yacht clubs are: Courageous Sailing Center of Boston, Inc., Ischoda Yacht Club, South Norwalk, Connecticut, St. Francis

Yacht Club, San Francisco, California, and Yale Sailing Associates: Yale-Corinthian Yacht Club, Branford, Connecticut. The eight individual amici (Robert N. Bavier, Jr., John Bertrand, Briggs Cunningham, William P. Ficker, Sir James Hardy, Frederick E. "Ted" Hood, Arthur Knapp, Jr. and Graham Mann) are some of the most highly respected and widely known yachtsmen in recent yacht racing history. All have had extensive connection with and experience as skippers of competing boats in America' Cup competitions. Five are former skippers of yachts which won the America's Cup trophy (Cunningham [Columbia, 1958], Bavier, Jr. [Constellation, 1964], Ficker [Intrepid, 1970], "Ted" Hood [Courageous, 1974], Bertrand [Australia II, 1983]). The yachting background and experience of these men, their trophies and awards and the numerous yachting committees and boards on which they have served are fully summarized in the amici brief, at pp 8-14. In view of San Diego's contention that the dispute over the construction of the Deed of Gift should have been referred to an international jury of yacht racing officials certified by the International Yacht Racing Union (IYRU), it is, perhaps, worthy of note that among the amici are at least three certified judges of the U.S. Yacht Racing Union, one former representative of the U.S. to the International Yacht Racing Union (IYRU) and one former chairman of the Appeals Committee of the U.S. Yacht Racing Union.

9. Giamatti, Take Time for Paradise: Americans and Their Games (Summit Books, 1989, pp 62-63).

0. See, e.g., the majority's statement that San Diego was justified in responding to the challenge "by availing itself of the competitive

opportunity afforded by the broad specifications in the deed". (Slip Opn, p 16). (Emphasis added.)

1. The importance of having closely matched load water-line lengths in racing monohulls is that the length on the load water-line of a

monohull keel yacht bears a direct relationship to its hull speed. An accepted rule-of-thumb is that the square root of twice the load water-line length of a monohull keel yacht in feet is approximately equal to the yacht's hull speed in knots. For example, for a yacht with a load water-line length of 32 feet, the hull speed is approximately equal to the square root of 64, or 8 kts.

Except for four occasions during the history of America's Cup from 1870 until 1958, when the 12-meter competitions began, the defenders were shorter on the water-line than the challengers. In the case of the four exceptions, the defenders were very slightly longer (see Chart of Dimensions of America's Cup defender and challenges from 1870-1983, Appdx, CA 879-882, JA 2387, 2390).

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2. Joseph Busk, commenting on the concept that most matches would be held under the "mutual agreement clause" also stated in

his letter to the Earl of Dunraven: "the whole of the present deed hinges on this idea as it was never supposed that any club would refuse to make a fair sporting match * * *" (CA 788, JA 2078 [emphasis in original]).

3. See Mr. Justice Rubin's succinct explanation in Mercury Bay Boating Club, Inc. v San Diego Yacht Club (150 AD2d 82, 106-107)

(Rubin, J. concurring); see also, Affidavit of John Brian Shuttleworth (CA 992, CA 996, JA 2536, JA 2540).

4. (See e.g., Ballard, Sailing Back to the Future, Sports Illus., Dec. 7, 1987, CA 330, JA 1011; see also, article, The America's Cup -- An

Irish Joke, CA 394, JA 1112; article, 'Time's a Wasting,' Says Designer of U.S. Cup Defender, Providence Jour., December 13, 1989, CA 441, JA 1161; article, Counterpoint: The Views of Dick Newick, Sailing World, March 1988, CA 387, JA 1105; article, Mono v Multi: An America's Cup Scenario, Sailing World, April 1988, CA 390, JA 1103).

5. It is, of course, the identity of the dimension which the Deed of Gift specifies -- i.e., length on the load water-line -- and the

importance attached to the accurate submission of this dimension which are so highly relevant and helpful on the question of whether catamarans were contemplated. Because this "important" load water-line dimension has meaning when applied to monohulls but none when applied to catamarans, it seems quite evident that catamarans were never considered. It is of no significance to this central point that only the challenger is required under the Deed of Gift to give notification of the dimensions of the challenging yacht and that, of course, only the challenger is bound by the dimensions it submits to the defender (see Majority Opn, p 14)(see discussion infra, p 24-25).

6. The primary definition of "any" in Webster's New 20th Century Dictionary, Second Edition is:

l. one (no matter which) of more than two; as any boy may go.

7. The secondary definition of "any" in the Webster's New 20th Century Dictionary, Second Edition is:

2. some (no matter how much, how many, or what kind); as, do you have any apples?

8. The Schuyler letter of April 15, 1871 establishes beyond doubt that the only purpose of adding the phrase "against any one yacht

or vessel" was to clarify what Mr. Schuyler thought was already implicit in the original Deed of Gift -- that one challenger should race against one defender. Indeed, it appears from that letter that Mr. Schuyler in 1871 thought that adding the words in the phrase "against any one yacht or vessel" (later added to the Deed of Gift in 1887) "would have been unnecessary and superfluous" (CA 506, JA 1310 [emphasis added]).

9. John Rousmaniere, a yacht historian, writing in "Sailing World" stated that "* * * there is every reason to believe that George

Schuyler would have found the prospect [racing multi-hulls in America's Cup competition] ludicrous both then and now. First, the legal standing of multihulls as racing yachts was severely questioned in the 1870s and after. While multihulls were not unknown in European and American yachting before then, they were not considered anything more than experimental toys until Nathanael Herreshoff turned up at some Long Island Sound regattas in 1876 in his ingenious 25-foot LOA cat Amaryllis. * * *[e]ven proponents of catamarans admitted that they were dangerous in rough water. Certainly they were not seaworthy enough to cross an ocean to sail in a Cup match" (emphasis added). (See CA 334-335, JA 1047-1048.)

0. See References in Schuyler Letter, April 15, 1871 to necessity for challengers to make ocean crossings, CA 510 JA 1314, CA 512 JA

1316, CA 514, JA 1318; Majority Opn at pp 4-5 (Deed of Gift was amended in 1956 "to eliminate the requirement that the challenger sail to the match 'on its own bottom', a requirement which had disadvantaged foreign challengers"); comment of yacht historian Rousmaniere, underscored last sentence, n 19 supra, p 24.

1. See Discussion of the "Thistle" challenge, supra, pp 16-17; see also, history of America's Cup challenges, supra, pp 14-16; Chart of

Dimensions of America's Cup Defender and Challenges from 1870-1983 showing closeness of load water-line lengths of challengers and defenders, Appdx, CA 879, JA 2387.

2. This same feeling is reflected in a statement made by the concurrer at the Appellate Division that he could not "agree, however,

with the proposition that the America's Cup competition is now, if it ever was, a paradigm of good sportsmanship" (150 AD2d 82, 107, Concurring Opn, Rubin, J.). *****************

Order affirmed, with costs. Opinion by Judge Alexander in which Chief Judge Wachtler and Judges Simons, Kaye and Bellacosa concur, Chief Judge Wachtler in a separate opinion. Judge Hancock dissents and votes to reverse in an opinion in which Judge Titone concurs.

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CASE 2: GOLDEN GATE YACHT vs. SOCIETE NAUTIQUE DE GENEVE 2008 N.Y. Slip Op. 30782 (N.Y. Sup. Ct. 2008) This case involves a consolidation of two motions, each claiming that Golden Gate YC was not in compliance with requirements of Deed of Gift

SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK: IAS Part 49 GOLDEN GATE YACHT CLUB, Plaintiff, - against SOCIETE NAUTIQUE DE GENEVE, Defendant, CLUB NAUTICO ESPANOL DE VELA, Intervenor-Defendant

Index No. 602446/07

HERMAN CAHN, J.: Motion sequence numbers 005 and 006 are consolidated for disposition.

In motion number 005, Société Nautique de Geneve (SNG) moves for reargument and renewal of this court’s decision, dated November 27, 2007 (Prior Decision), which, in a single decision, consolidated four separate motions (collectively, Prior Motion).

In motion number 006, SNG moves for an order declaring the “Notice of Challenge,” dated July 11, 2007, and the “Certificate,” annexed thereto, by Plaintiff Golden Gate Yacht Club (GGYC), to be in non-compliance with, and invalid under, the Deed of Gift, dated October 24, 1887 (Deed).

As discussed in the Prior Decision, the America’s Cup is a trophy awarded to the winner of a world-renowned yacht race that has been held 32 times since the first America's Cup race held in 1851. The Deed governs how challenges are made for the Cup, who may be a qualified “Challenger of Record,” and the manner in which matches for the Cup are to proceed. When the “Defending Club” and the “Challenger of Record’’ agree upon the match term pursuant to a mutual consent process, they issue a Protocol setting forth the terms. SNG, through ‘Team Alinghi, is the current Defending Club and trustee, having won the 31st Cup race on March 2, 2003, and having successfully defended its title in the 32nd Cup race on July 3, 2007. GGYC was the Challenger of Record for the 32nd America’s Cup. On July 3, 2007, SNG accepted a challenge, dated June 29, 2007, from intervenor/defendant Club Nautico Espanol de Vela (CNEV) for the 33rd America’s Cup race, and thereby purported to make CNEV the Challenger of Record. On July 11,2007, GGYC issued its own Notice of Challenge for the 33rd America’s Cup race, contending that it, and not CNEV, was the valid Challenger of Record, in that it, but not CNEV, met the requirements set forth in the Deed.

In commencing this action, GGYC contended that CNEV was not qualified to be designated as the Challenger of Record in the forthcoming America’s Cup competition and that, therefore, the court should vacate SNG’s acceptance of CNEV’s challenge. GGYC sought: (1) a declaration that CNEV’s purported challenge and the Protocol issued pursuant thereto are void; (2) a declaration that GGYC’s challenge is valid; (3) judgment in favor of GGYC and against SNG (i) enjoining SNG from promulgating rules and regulations pursuant to the Protocol, and (ii) directing SNG to reject CNEV’s challenge; and (4) judgment in favor of GGYC, acted against SNG, directing SNG to (i) accept GGYC’s Notice of Challenge and (ii) to implement the terms of the Deed by participating with GGYC in the establishment of a Protocol through a consensual process and, failing that, to proceed with the match under the rules expressly set forth in the Deed.

Motion 005 In the Prior Decision, this court: (1) determined that the challenge by CNEV was invalid; (2) determined that GGYC is Challenger of Record pursuant to the Deed; and (3) dismissed GGYC’s breach of fiduciary duty claim against SNG. SNG seek reargument of two aspects of the Prior Decision. First, it contends that, in adjudicating the validity of GGYC’s challenge, the court failed to consider, or overlooked, certain inconsistencies OF flaws in that challenge. SNG contends that GGYC’s motion

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papers did not raise, or attempt to establish, the validity of GGYC’s Notice of Challenge and Certificate. Thus, neither SNG nor CNEV had any reason to address that issue on the Prior Motion. SNG argues further that GGYC’s challenge is deficient on its face.

Second, SNG argues that one of the facts upon which the court based its decision to declare CNEV’s challenge invalid - that CNEV had yet to hold an annual regatta - is no longer true. CNEV held its first annual regatta on November 24 and 25, 2007, alter the parties briefed and argued the Prior Motion, but two days prior to the issuance of the Prior Decision.

The motion is denied. Notwithstanding these assertions, SNG has not demonstrated that the court overlooked any relevant fact, misapprehended the law or otherwise mistakenly arrived at its determination (Spinale v 10 W 66th St. Corp., 193 AD2d 43 1 [1st Dept 19931; Pro Brokerage v Home Ins. Co., 99 AD2d 971 [ 1st Dept 19841).

As stated above, SNG argues that GGYC’s motion papers did not raise or attempt to establish the validity of its own Notice of Challenge and Certificate and, therefore, neither SNG nor CNEV had any reason to address the issue. This assertion is unpersuasive.

The verified complaint contains a section entitled “GGYC Issued a Valid Notice of Challenge,” in which it set forth the requirements contained in the Deed for a valid challenge, as well as the assertion that it has complied with those requirements (see Compl, Para 39-41).

As set forth in the Prior Decision, GGYC sought, among other things, judgment in favor of GGYC and against SNG enjoining SNG (i) from accepting GGYC’s Notice of Challenge and (ii) to implement the terms of the Deed by participating with GGYC in agreeing on a Protocol and, failing that, to proceed with the match under the rules expressly set forth in the Deed.

In addition, SNG’s own papers submitted on the Prior Motion contained a copy of the Notice of Challenge and Certificate (Ross Aff, Exh Q). Moreover, SNG asserted “GGYC also has made clear that, should it prevail in this lawsuit, if SNG does not accept GGYC’s demands in negotiations for a protocol, GGYC will race a two-hulled catamaran of the maximum size allowed under the Deedvirtually guaranteed to defeat a single-hulled vessel” (Mot Br at 2). In response, GGYC stated that “SNG erroneously asserts that GGYC sought some individual advantage by designating as its representative vessel, in its notice of challenge, a ‘catamaran’ (a multihull that under most conditions is substantially faster than a monohull)” (Cross-Mot Br at 22).

Thus, the contention that the court should not have addressed the validity of GGYC’s challenge, because it was not an issue, is belied by evidence contained in the record on the Prior Motion. Evidently, SNG decided to focus on asserting an unclean hands defense; the court need not speculate as to why the position it adopts now was not adopted then, and does not suggest that it should have been. In short, the court offers no opinion as to the merits of any of the parties’ litigation strategies.

In now arguing for renewal, SNG contends that the court should revisit the Prior Decision because “one of the facts upon which the Court based its decision to declare CNEV’s challenge invalid - that CNEV had yet to hold an annual regatta - is no longer true. CNEV held its first annual regatta on November 24 arid November 25, 2007, after the motions for summary judgment were fully briefed and argued before this Court and just two days prior to this Court’s Decision" (Mot Br at 3 j. In essence, SNG seeks reargument of this determination, not renewal, because SNG has not submitted any new or additional facts (Fontanez v St. Barnabas Hosp., 24 AD3d 218 [1st Dept 2005]). That CNEV held its first annual regatta on November 24 and 25, 2007 does not actually constitute new facts because the Prior Decision acknowledged the scheduling of the November 2007 regatta.

That CNEV may have held its first annual regatta two days prior to November 27, 2007, the date of the Prior Decision, is inconsequential. As stated in the Prior Decision: Although SNG and CNEV contend that CNEV complies with the annual regatta requirement, they do not contend that CNEV had held an actual regatta at the time or its Notice of Challenge, dated June 29, 2007, or by GGYC’s subsequent challenge on July 11, 2007.

According to Bonet, CNEV is planning to hold its first annual regatta called the ‘Club Nautico Espanol de Vela Primera Regatta, Trofeo Desafio Espano’ on open water off Valencia, Spain in November 2007. . . .

Thus, that CNEV may someday comply with the conditions of the Deed has no bearing on GGYC’s valid challenge that it issued after the date of CNEV’s invalid challenge, but prior to such time as CNEV may fulfill the conditions of the Deed.

Reargument is not designed to afford the unsuccessful party successive opportunities to reargue issues previously decided (William P. Pahl Equipment Corp, v Kassis, 182 AD2d 22 [1st Dept], lv dismissed in part, denied in part 80 NY2d 1005 [1992], renrg denied 81 NY2d 782 [1993]).

Motion 006 In this motion, SNG seeks an order declaring GGYC’s Notice of Challenge and Certificate to be in non-compliance with, and invalid under, the Deed. SNG argues that the Certificate is invalid because it states that GGYC intends to compete with a “keel yacht,”

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which, arguably, is a mono-hull vessel, yet the dimensions set forth in the Certificate describe a multi-hull vessel. Therefore, SNG contends, the ambiguity renders the Certificate facially defective. In making this argument, SNG essentially restates many of the claims raised in motion number 005 for reargument. To the extent that the motion raises issues that were not specifically raised or addressed in detail, however, the court will consider them. In effect, the result remains the same.

Regarding this issue, the Deed provides: The Challenging Club shall give ten months’ notice, in writing, naming the days for the proposed races . . . . Accompanying the ten months’ notice of challenge there must he sent the name of the owner and a certificate of the name, rig, and, following dimensions of the challenging vessel, namely, length on load water-line; beam at load water-line and extreme beam: and draught of water, which dimensions shall not be exceeded; and a custom-house registry of the vessel must also be sent as soon as possible. Centreboard or sliding keel vessels shall always be allowed to compete in any race for the Cup, and no restriction nor limitation whatever shall be placed upon the use of such centre-board or sliding keel, nor shall the centre-board or sliding keel be considered a part of the vessel for any purposes of measurement. (emphasis added).

Thus, the documentation supporting the challenge must include “the name of the owner and a certificate of the name, rig, and following dimensions of the challenging vessel, namely, length on load water-line; beam at load water-line and extreme beam; and draught of water, which dimensions shall not be exceeded. . . . ” GGYC’s Certificate (Meyer Aff, Exh C) is valid in that it contains all of this information and, therefore, complies with the requisites set forth in 6 the Deed.

Notably, SNG does not argue that the Certificate does not fulfill these requirements set forth in the Deed (Mot Br at 6). Instead, it argues that the use of the word “keel” in the introductory section of the Certificate renders it invalid. The introduction reads: I, Commodore Marcus Young, certify the details set out below as to the name, rig and specified dimensions of the keel yacht to represent Golden Gate Yacht Club in a match for the America’s Cup to be sailed in accordance with the Notice of Challenge herewith: SNG argues that, by use of the word “keel” in the Certificate, the Certificate contains “an inherent and irreconcilable internal consistency, rendering its Certificate and accompanying Notice of Challenge deficient and invalid.” SNG contends that the vessel specifications of a length of 90 feet and a beam of 90 feet are unusual for a keel yacht, and would be more ordinarily consistent with the dimensions of a multi-hulled vessel (Mot Br at 6-7).

Although SNG now claims that there is ambiguity about the racing vessel set forth in GGYC’s Certificate, the record on the Prior Motion contained evidence submitted by SNG indicating its belief’ that there was no ambiguity in GGYC’s Certificate. According to the affidavit of Hamish Ross, Esq., General Counsel of Alinghi, SNG’s representative racing team, the Certificate could only be for a “multi-hulled vessel - presumably, catamaran” (Ross Aff). Moreover, that the designated racing vessel may be “unusual” hardly justifies characterizing the Certificate as containing an “inherent and irreconcilable internal consistency.”

As stated above, in its Memorandum of Law in Support on the Prior Motion, SNG asserted that “GGYC also has made clear that, should it prevail in this lawsuit, if SNG does not accept GGYC’s demands in negotiations for a protocol, GGYC will race a two-hulled catamaran of the maximum size allowed under the Deed - virtually guaranteed to defeat a single-hulled vessel.” Hence, SNG has not established that the “keel yacht” cannot describe a multi-hull vessel.

More importantly, even if the description of a “keel yacht” were inconsistent with the dimensions set forth in the Certificate, it is the dimensions that control, not the introduction to that portion of the Certificate. The Certificate “certifies the details set forth below,” and it is those “details” that matter, because the Certificate has provided them in accordance with the express requirements of the Deed. That this is so is revealed by the introduction to each “detail” category which corresponds exactly to the relevant Deed provision, quoted above, namely: (1) Name; (2) Owner; (3) Rig; and (4) Dimensions. The Deed, which is a clear and complete document, is to be enforced according to its terms (W. W .W. Assoc. v Gimcontieri, 77 NY2d 157 [ 19901; Dafnos v Hayes, 264 AD2d 305 [ 1’‘ Dept 19991). Thus, there is no need for a hearing to determine the effect of the use of the word “keel.”

SNG also argues that the Certificate violates the Deed, because the Deed ‘requires the challenger to provide an accurate certificate describing the Challenging Vessel so that the defender will have adequate opportunity to prepare its defense” (Mot Rr at 7). SNG does not provide any reference to the Deed that contains this alleged “requirement.” In fact, the Deed “broadly defines the vessels eligible to compete in the match” and the “deed permits the competitors to both construct and race the fastest vessels possible so long as they fall within the broad criteria of the deed” (Mercury Bay Boating Club v San Diego Yacht Club (76 NY2d 256, 266, 269 [ 1990]) (Mercury Bay) [emphasis added]). The “donors, who chose to be specific about other aspects of the match, including the

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load water-line lengths of the competing vessels, could have easily included an express requirement that the vessels be evenly matched but did not do so” (id. at 269).

Moreover, for the reasons discussed above, I am not persuaded that SNG will be unable to prepare an adequate defense.

Furthermore, to the extent that the challenge raises “sporting” issues, the sole province of the court is to resolve the legal issues presented (Mercury Bay, 76 NY2d at 266). As stated in the Prior Decision, and equally relevant here, in Mercury Bay, the Court of Appeals held that the Deed’s unambiguous language, permitting the defender to defend the Cup in “any one yacht or vessel” within the specified range of load water-line length, did not require the defender to race a vessel of the same type or evenly-matched to that of the challenger, and did not preclude the defender’s use of a catamaran (id. at 269). The Court in Mercury Bay expressly declined to consider whether the San Diego club’s conduct was “unsportsmanlike” and “unfair,” holding that the Deed appropriately left such issues to yachting experts and limited itself to strictly applying the terms of the Deed (id, at 271).

SNG next argues that the Notice of Challenge is invalid for the additional reason that it failed to provide 10 months’ notice to SNG as required by the Deed. However, the July 11, 2007 Notice of Challenge designated July 4, 2008 as the date of the first race, and July 6,2008 and July 8, 2008 as the respective dates for the second and third races, if necessary, thereby satisfying the 10-month advance notice requirement. Contrary to SNG’s assertion, that the parties wound up entangled in legal proceedings, which “interrupted” the 10-month period, does not invalidate the Notice of Challenge.

As a third ground for the assertion that the Certificate is facially deficient, SNG contends that the proposed race dates violate the Deed, because the Certificate does not designate at least one “week day” between each race. The absence of a week day separating the first race of July 4, 2008, which is a Friday, and the second proposed race date of July 6, 2008, which is a Sunday, does not invalidate the Certificate. Although the Deed provides that “one week day shall intervene between the conclusion of one race and the starting of the next race,” it does not make this a requirement of the validity of Notice of Challenge. Further, dictionaries published contemporaneously with the Deed, define “weekday” or “week day” as any day except Sunday (see Petrocelli Aff, Exhs B, C at 275, 631). If the parties wish to have a “business” day separate each race, they could simply adjust of the race dates to, by way of example, July 3, 2008 (Thursday), July 6, 2008 (Sunday), and July 8, 2008 (Tuesday), which would amount to an adjustment of one day.

Apparently SNG has waived this requirement, because it contends that CNEV’s challenge is valid, even though CNEV’s own certificate designated race dates of July 1, July 3, and July 5, 2009. July 3, 2009 is a Friday and July 5, 2009 is a Sunday. Hence, the record indicates that a “week day” separates each race.

Finally, at oral argument, SNG urged the court to either conduct an evidentiary hearing or refer the issue of the type of yacht that GGYC intends to challenge to the “International Sailing Federation.” For the reasons staled above, such hearing or referral is unnecessary to resolve the legal issues presented - the Certificate’s description of the racing vessel complies with the Deed requirements. If, however, the parties cannot resolve issues pertaining to the 10-month notice period, in view of any delayed entailed by this litigation or otherwise, and any lingering dispute as to the “week day” issue, the parties may raise the issue with the court at a further hearing, or mutually agree to refer those disputes to a neutral associated with the yachting community (see Mercury Bay, 76 NY2d at 265-66).

Accordingly, it is ORDERED that the motion (005) by Société Nautique de Geneve for reargument and renewal of this court’s decision, dated November 27, 2007, is denied; and it is further ORDERED that the motion (006) by Société Nautique de Geneve for an order declaring the Notice of Challenge and Certificate by Golden Gate Yacht Club to be in non-compliance with and invalid under the Deed of Gift, dated October 24, 1887, is denied.

Dated: March 17, 2008

CASE 3: GOLDEN GATE YACHT vs. SOCIETE NAUTIQUE DE GENEVE 2008 N.Y. Slip Op. 32296 (N.Y. Sup. Ct. 2008) This case involves a consolidation of several separate cases – finding that Colden Gate YC’s challenge was proper, and that the Match should be held in Valencia Spain.

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SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK: IAS Part 49 GOLDEN GATE YACHT CLUB, Plaintiff, - against – SOCIIETE NAUTIQUE DE GENEVE, Defendant, CLUB NAUTICO ESPANOL DE VELA, Intervenor-Defendant

Index No. 602446/07 ORDER

HERMAN CAHN, J.: Plaintiff Golden Gate Yacht Club (“GGYC”) in motion sequence number 001 having moved this Court for a preliminary injunction and expedited discovery and an expedited trial, and non-parties Reale Yacht Club Canottieri Savoia and Mascalzone Latino (collectively, “Amici”) in motion sequence number 002 having moved this Court for leave to file an amici curiae brief, and Defendant Société Nautique de Geneve (“SNG”) in motion sequence number 003 having moved this Court to dismiss and for summary judgment, and GGYC in motion sequence number 003 having cross-moved this Court for an order pursuant to N.Y. C.P.L.R. 321 l(c) and 3212 granting GGYC’s cross-motion for summary judgment, together with such further and other relief as this Court deems just and proper, and Intervenor-Defendant Club Nautico Espanol de Vela (“CNEV”) in motion sequence number 004 having moved this Court for summary judgment and an order dismissing Plaintiffs claims; NOW, upon reading and filing the following papers submitted to the Court: Motion Sequence number 001: GGYC’s Order to Show Cause, dated August 22, 2007, and the accompanying Memorandum of Law, the Affirmation of Gina M. Petrocelli and the Affidavit of Thomas F. Ehman, including the exhibits attached thereto; SNG’s September 5, 2007 Memorandum of Law in Opposition and the September 5,2007Affidavits of Hamish Ross and Miquel Terrasa Monasterio, including the exhibits attached thereto; Motion Sequence number 002: Amici’s October 5, 2007 Order to Show Cause and the Affirmation of Lance J. Gotko, including the exhibits attached thereto; SNG’s October 12, 2007 Response to Proposed Amici’s Application; Motion Sequence numbers 003 and 004: SNG’s September 21 Notice of Motion and Memorandum of Law, the Affidavit of Hamish Ross and Affirmation of David G. Hille including the exhibits thereto, and SNG’s September 21, 2007 Commercial Division Rule 19-a Statement of Material Facts; CNEV’s September 21, 2007 Notice of Motion and the Affidavit of Manuel Jose Chirivella Bonet; GGYC’s October 5,2007 Notice of CrossMotion, Memorandum of Law, the Affidavit of Thomas F. Ehman, Jr. and Affirmation of James V. Keamey including the exhibits thereto, and GGYC’s Commercial Division Rule 19-a Statement of Material Facts, and Response to SNG’s Commercial Division Rule 19-a Statement of Material Facts; SNG’s October 12, 2007 Memorandum of Law, Response to Plaintiffs Commercial Division Rule 19a Statement, the Affidavit of Hamish Ross, including the exhibits thereto and CNEV’s October 12, 2007 Reply Memorandum of Law and Response to Plaintiffs Commercial Division Rule 19-a Statement and the Affidavit of Manuel Jose Chirivella Bonet and Affirmation of Catherine M. Doll, including the exhibits attached thereto, and GGYC’s October 19, 2007 Reply Memorandum of Law and Affirmation of Gina M. Petrocelli, including the exhibits attached thereto; AND upon reading and filing the following additional papers submitted to the Court: SNG’s December 27,2007 Notice of Motion and Memorandum of Law in Support of Motion to Renew and Reargue pursuant to CPLR 222 1, the Affidavit of Fred Meyer and the exhibits attached thereto; GGYC’s January 2, 2008 Memorandum of Law in Opposition to SNG’s Memorandum of Law in Support of Motion to Renew and Reargue, the Affirmation of Gina M. Petrocelli and the exhibits attached thereto; SNG’s January 14,2008 Order to Show Cause, the Affirmation of Jonathan K. Youngwood and the exhibits attached thereto; the January 23, 2008 Affirmation of Gina M. Petrocelli and the exhibits attached thereto; the January 28,2008 Affirmation of Barry R. Ostrager and the exhibits attached thereto; GGYC’s March 26,2008 Notice of Filing and the exhibit attached thereto; SNG’s March 28,2008 Notice of Filing and the exhibit attached thereto; GGYC’s April 1,2008 Notice of Filing and the exhibit attached thereto; SNG’s April 2,2008 Notice of Filing and the exhibit attached thereto; AND upon hearing oral argument from counsel for the parties on September 10, 2007, October 22, 2007, January 14, 2008, January 23, 2008, and April 2, 2008; AND, upon all prior pleadings and proceedings hereto; AND, upon the Decision and Order issued by this Court on November 27, 2007 (the “November 27, 2007 Decision”) granting Plaintiff GGYC’s cross-motion for summary judgment, dismissing GGYC’s breach of fiduciary duty claim against SNG and directing the parties to “Settle Order”, a true copy of which is annexed hereto as Exhibit A;

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AND, whereas, on July 11, 2007, GGYC issued a “Notice of Challenge for the America’s Cup” (“Notice of Challenge”) that the Court determined to be a valid challenge in its November 27, 2007 Decision; whereas, at a September 10, 2007 hearing before the Court on GGYC’s motion for preliminary injunction and expedited discovery, the Court inquired whether the parties would enter into an agreement, pursuant to which the date for the challenge match races prescribed in the Deed of Gift would be extended following a final decision on the merits of this litigation, and counsel for the parties agreed to attempt to negotiate a stipulation tolling the notice period pending a final decision on the merits; it is hereby ORDERED that the Motion, sequence number 001 for preliminary injunction and expedited discovery and an expedited trial, is denied as moot; and it is further ORDERED that the Motion, sequence number 002 for leave to file an amici curiae brief, is granted; and it is further ORDERED that Defendant SNG’s Motion to Dismiss and for Summary Judgment in sequence number 003 is granted to the extent it dismisses GGYC’s breach of fiduciary duty cause of action, and Plaintiff GGYG’s Cross-Motion for Summary Judgment in sequence number 003 is granted; and it is further ORDERED that the Motion, sequence number 004 by CNEV for Summary Judgment and to Dismiss GCYC’s claims, is denied; and it is further ORDERED and adjudged that CNEV’s challenge is invalid, and CNEV is not a valid Challenger of Record pursuant to the Deed of Gift; and it is further ORDERED and adjudged that GGYC’s challenge is valid, and GGYC is the Challenger of Record pursuant to the Deed of Gift; and it is further ORDERED that the dates for the challenge match races shall be the date ten calendar months from the date of service of a copy of this order, with notice of entry, upon the attorneys who have appeared herein, unless said date is a Sunday or legal holiday, in which case the next day shall be the first date of the challenge match races. The second date shall be two business days thereafter and the third date, if necessary, shall be two business days after the second race. Notwithstanding the above, the parties may mutually agree in writing to other dates.

ORDERED that the location of the match shall be in Valencia, Spain or any other location selected by SNG, provided SNG notify GGYC in writing not less than six months in advance of the date set for the first challenge match race of the location it has selected for the challenge match races; and it is further ORDERED that GGYC and SNG may engage in a mutual consent process and make any arrangement satisfactory to both as to the dates, courses, number of trials, rules and sailing regulations, and any and all other conditions of the challenge match races in accordance with the Deed of Gift; and it is further ORDERED that the Clerk of Court is directed to enter judgment accordingly.

Dated: May 12, 2008

Argued February 10, 2009; decided April 2, 2009 This document presents the Court’s Final Opinion

CASE 4: GOLDEN GATE vs. SOCIÉTÉ NAUTIQUE de GENÈVE 55 A.D.3d 26 (N.Y. App. Div. 2008) Golden Gate Yacht Club vs.

Société Nautique de Genève, 55 AD3d 26, reversed. {**12 NY3d at 251} OPINION OF THE COURT Ciparick, J.:

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This appeal involves the preeminent international sailing regatta and match race, the America's Cup. We had occasion once before to examine the charitable trust that governs the competition. In Mercury Bay Boating Club v San Diego Yacht {**12 NY3d at 252} Club (76 NY2d 256 [1990]), we strictly construed the provisions of the trust instrument, the Deed of Gift, to allow multihulled vessels to compete in the America's Cup race. Today, we are called upon to reexamine the Deed of Gift to determine the eligibility criteria for a Challenger of Record—specifically whether the phrase "having for its annual regatta" requires a yacht club to hold an annual regatta on the sea prior to issuing its challenge (Deed of Gift, Oct. 24, 1887, ¶ 4). We conclude that it does.

The story of the America's Cup begins on August 22, 1851, after the schooner yacht, America, entered a race against British sailing vessels around the Isle of Wight, winning a large silver cup. In honor of the winning boat, the trophy was christened the "America's Cup," which became the corpus of a charitable trust created under the laws of New York and donated pursuant to a Deed of Gift to the New York Yacht Club in 1857. The Deed of Gift establishes the rules governing the America's Cup and provides that the holder of the Cup becomes its sole trustee and is succeeded only by a successful challenger in a race at sea. The original Deed of Gift required only that the challenger be an "organized" yacht club.

During the first 30 years after its inception, problems arose with the administration of the competition. As a result, the America's Cup was twice returned to George L. Schuyler, the sole-surviving donor, after two disappointing America's Cup races were sailed by Canadian Great Lakes yacht clubs under the command of Captain Alexander Cuthbert. Neither of the challenging vessels could withstand the rigors of open sea competition. The Countess of Dufferin, the first challenging vessel, was described as having "fresh water written all over her . . . [h]er hull lacked finish, being as rough as a nutmeg grater . . . and she had little of the shipshape appearance expected of a cup challenger."[FN1] The Atalanta, the second challenging vessel, was also denounced by critics as being "a new yacht, hastily built, totally untried, and miserably equipped."[FN2] To deal with this "unseaworthiness" issue, Schuyler amended the Deed of Gift with the intent of precluding Great Lakes yacht clubs from competing and reconveyed the America's Cup to the New York Yacht Club to hold in trust. In addition to requiring that a {**12 NY3d at 253} challenger be an "organized" yacht club, the amended Deed of Gift, dated October 24, 1887, added new eligibility requirements that a challenger must meet, including that it be "incorporated, patented, or licensed by the legislature, admiralty, or other executive department, having for its annual regatta an ocean water course" (Deed of Gift, Oct. 24, 1887, ¶ 4). The Deed further provides that the Cup "shall be preserved as a perpetual Challenge Cup for friendly competition between foreign countries."[FN3] The Cup has been defended 32 times and it is the events that occurred after the conclusion of the 32nd America's Cup held on July 3, 2007, in Valencia, Spain, which give rise to this appeal. Société Nautique de Genève (SNG)[FN4] won the Cup on March 2, 2003 in the 31st America's Cup match and successfully defended its right to continue as trustee of the America's Cup in the July 3, 2007 race.

Club Nautico Espanol de Vela (CNEV),[FN5] on that very same day, submitted a Notice of Challenge to SNG for the 33rd America's Cup, which was accepted.

The Deed of Gift provides that once a Defender accepts a challenge, the two yacht clubs may negotiate and set the conditions of the next America's Cup competition through their mutual consent. Although not named as such by the Deed of Gift, the sailing community refers to the resulting agreement as the "protocol" and the challenging yacht club with the right to negotiate the protocol is called the Challenger of Record. Since 1970, other yacht clubs that wish to compete in the America's Cup have been allowed to participate in the race when the Defender and the Challenger of Record agree to such an arrangement and provide in their protocol for such participation. Traditionally, challengers that are allowed to participate based upon the mutual agreement of the Defender and the Challenger of Record pursuant to their resulting protocol are known as Mutual Consent Challengers. However, should the Defender and the Challenger of Record fail to reach an agreement as to the terms under which they will race, the Deed of Gift contains a default match provision for a one-on-one race between the Defender and the Challenger of Record.

On July 5, 2007, SNG as the Defender and CNEV as Challenger of Record published a protocol for the 33rd America's {**12 NY3d at 254} Cup setting forth the conditions of the competition that includes an arbitration provision to resolve disputes. On July 11, 2007, plaintiff Golden Gate Yacht Club (GGYC),[FN6] disputing the validity of CNEV's challenge, primarily on the basis that CNEV was not a bona fide yacht club—formed only a few days before submitting its challenge—and had never held an annual regatta, presented its own Notice of Challenge. SNG rejected GGYC's challenge on the basis that CNEV's challenge was first in time and since CNEV's challenge had already been accepted, no other challenge could be considered until after CNEV's challenge had been decided.

On July 20, 2007, SNG, seeking to resolve the validity of CNEV's challenge, initiated an arbitration proceeding pursuant to the dispute resolution mechanism provided for in the 33rd protocol. The 33rd America's Cup Arbitration Panel invited GGYC to participate in the arbitration. GGYC rejected the invitation and commenced this present litigation because it could participate in the arbitration only by agreeing to the protocol, thereby exposing itself to possible disqualification at SNG's sole discretion. The Arbitration Panel ultimately found that the Deed of Gift does not require a challenging club to have held an annual regatta prior to issuing its Notice of

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Challenge and therefore CNEV's Notice of Challenge was valid. All parties concede that the arbitration decision is not binding upon us.

In the present action, GGYC alleges that SNG breached the Deed of Gift and its fiduciary duty as trustee by accepting CNEV's challenge because CNEV failed to comply with the challenger eligibility criteria set forth in the Deed of Gift since CNEV was not an organized yacht club and had never conducted an annual regatta.[FN7] Both sides moved for summary judgment. Although Supreme Court dismissed GGYC's breach of fiduciary duty claim, it declared that the Notice of Challenge issued by CNEV was indeed invalid because CNEV failed to meet the Deed of Gift's eligibility requirements as it had not held an annual regatta on an ocean water course prior to submitting its Notice of Challenge to SNG. Supreme Court, strictly interpreting the Deed of Gift, declared GGYC to be the Challenger of Record. A divided Appellate Division reversed, holding the language of the Deed to be ambiguous {**12 NY3d at 255} and declaring the Notice of Challenge issued by CNEV valid, and CNEV the rightful Challenger of Record (55 AD3d 26 [2008]). GGYC appealed pursuant to CPLR 5601 (a) dissent grounds and we now reverse.

In Mercury Bay, where we resolved a dispute regarding a type of vessel that arose relating to the 27th America's Cup match, we stated that "[l]ong-settled rules of construction preclude an attempt to divine a settlor's intention by looking first to extrinsic evidence. Rather, the trust instrument is to be construed as written and the settlor's intention determined solely from the unambiguous language of the instrument itself. It is only where the court determines the words of the trust instrument to be ambiguous that it may properly resort to extrinsic evidence" (76 NY2d at 267 [citations omitted]).

The relevant provisions of the Deed of Gift to be construed here at paragraph 4 provide that "[a]ny organized Yacht Club of a foreign country, incorporated, patented, or licensed by the legislature, admiralty, or other executive department, having for its annual regatta an ocean water course on the sea, or on an arm of the sea, or one which {**12 NY3d at 256} combines both, shall always be entitled to the right of sailing a match for this Cup." The Deed, in paragraph 10, further provides that "when a challenge from a Club fulfilling all the conditions required by this instrument has been received, no other challenge can be considered until the pending event has been decided." Finally, paragraph 11 of the Deed states that the trustee "hereby covenants and agrees . . . that it will faithfully and fully see that the foregoing conditions are fully observed and complied with by any contestant."

Thus, to comply with the eligibility requirements as outlined by the Deed, a challenger must be (1) an organized yacht club, (2) foreign, in that it is not of the same country as the trustee yacht club, (3) incorporated in its local jurisdiction or officially recognized either through a license or patent from its government, (4) and "having for its annual regatta an ocean water course on the sea, or on an arm of the sea, or one which combines both." It is the last requirement that divided the court below[FN8] in light of the fact that CNEV had not held an annual regatta on the sea prior to submitting its Notice of Challenge. It is undisputed that the Defender has the obligation to address a challenge only when the challenger is a "Club fulfilling all the conditions required" (Deed of Gift, Oct. 24, 1887, ¶ 10). When such a challenge occurs, all other challenges are foreclosed.

As we stated in W.W.W. Assoc. v Giancontieri (77 NY2d 157, 162 [1990]), "[e]vidence outside the four corners of the document as to what was really intended but unstated or misstated is generally inadmissible to add to or vary the writing." The Appellate Division majority deemed the phrase, "having for its annual regatta," ambiguous and therefore found it appropriate to glean the settlor's intention as to the meaning and purpose of this phrase by looking to extrinsic evidence. We disagree and find the phrase to be unambiguous. As we did in Mercury Bay, we must first examine the plain language of the Deed of Gift and determine, as a matter of law, whether the language can be construed as written and the settlor's intention determined solely from the unambiguous language of the instrument itself.

In looking at the plain language of the Deed of Gift itself, as we must, we first note that the annual regatta requirement is only one of a list of eligibility requirements set forth in the Deed of Gift. The settlor clearly placed the requirements of "organized" and "incorporated, patented, or licensed" in the past and intended that a challenger would continue to meet these eligibility requirements in the present and future. For example, the term "incorporated" refers both to a past event of incorporation and to a continuing status. We believe that the settlor intended the same to be true for the "annual" regatta requirement. By using the word "annual," the settlor suggested an event that has already occurred at least once and will occur regularly in the future. Taken as a whole, we conclude that the settlor intended to link the annual regatta requirement to the other eligibility requirements in that the challenging yacht club has in the past and will continue in the future "having" an {**12 NY3d at 257} annual regatta on the sea.

Any other interpretation would render the annual regatta requirement a nullity.[FN9]

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The settlor clearly intended that for a challenging yacht club to be within the eligibility requirements, it must have held at least one qualifying annual regatta before it submits its Notice of Challenge to a Defender and demonstrate that it will continue to have qualifying annual regattas on an ongoing basis. Thus, SNG is wrong in its claim that the regatta requirement can be satisfied by race time rather than at the time of challenge. We conclude there is no ambiguity as to the annual regatta clause at issue. When read in the context of the entire Deed of Gift, the challenger must demonstrate that its Notice of Challenge "fulfill[s] all the conditions required" (Deed of Gift, Oct. 24, 1887, ¶ 10) at the time it submits its challenge.

SNG and CNEV assert that the existing practice among Defenders and Challengers of Record to allow Mutual Consent Challengers to participate in the America's Cup, even without having held an open sea course regatta, is evidence that the settlor intended that a challenging yacht club is not required to have held a regatta on the open sea prior to issuing its Notice of Challenge. This assertion has no merit because the plain language of the Deed of Gift itself forecloses such an illogical conclusion. Even if the language of the Deed of Gift were ambiguous, evidence of these practices would not qualify as extrinsic evidence of the settlor's intent in 1887 as these practices emerged much later. Thus, the decision of the Defender and the Challenger of Record to waive the eligibility requirements for yacht clubs seeking to participate as Mutual Consent Challengers has no bearing on whether a yacht club seeking to establish itself as the Challenger of Record must meet the requirements imposed by the Deed of Gift itself.

Since CNEV has failed to show that at the time it submitted its Notice of Challenge it was a "[c]lub fulfilling all the conditions required by" the Deed of Gift, it does not qualify as the Challenger of Record for the 33rd America's Cup competition and Supreme Court was correct in declaring GGYC to be the valid Challenger of Record.

It has been posited that the right to act as trustee of the America's Cup should be decided on the water and not in a {**12 NY3d at 258} courtroom. We wholeheartedly agree. It falls now to SNG and GGYC to work together to maintain this noble sailing tradition as "a perpetual Challenge Cup for friendly competition between foreign countries" (Deed of Gift, Oct. 24, 1887, ¶ 3).

Accordingly, the order of the Appellate Division should be reversed, with costs, and the orders of Supreme Court reinstated.

Judges Graffeo, Read, Smith, Pigott and Jones concur; Chief Judge Lippman taking no part.

Order reversed, etc.

Footnotes Footnote 1: Winfield M. Thompson and Thomas W. Lawson, The Lawson History of the America's Cup: A Record of Fifty Years, at 78 (Ashford Press Publishing, Southampton 1986) (internal quotation marks omitted).

Footnote 2: Id. at 88.

Footnote 3: The Deed has been amended twice by orders of the Supreme Court, New York County, dated December 17, 1956 and April 5, 1985.

Footnote 4: SNG is a yacht club organized under the laws of Switzerland.

Footnote 5: CNEV is a Spanish yacht club formed by the members of the Real Federacion Espanola de Vela (RFEV), a Spanish sailing federation, in June 2007.

Footnote 6: GGYC is a yacht club incorporated in the state of California.

Footnote 7: CNEV was allowed to intervene in this action.

Footnote 8: Supreme Court did not decide the question of whether CNEV was "organized" under the Deed and it is not necessary for us to reach this issue to resolve this appeal.

Footnote 9: The fact that CNEV has since held two ocean course regattas, one in November 2007 and a second in November 2008, is of no moment since none had been held in July 2007 prior to CNEV submitting its Notice of Challenge to SNG.

CASE 5: GOLDEN GATE YACHT CLUB vs. SOCIETE NAUTIQUE DE GENEVE This Case was a “Show Cause” why Société Nautique de Geneve should not be held in Contempt of Court

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Date: July 29, 2009 GOLDEN GATE YACHT CLUB, Plaintiff -againstSOCIETE NAUTIQUE DE GENEVE, Defendant CLUB NAUTICO ESPANOL DE VELA, Intervenor/Defendant KORNREICH, SHIRLEY WERNER, J: In this next permutation of an already lengthy litigation involving The America's Cup race, plaintiff Golden Gate Yacht Club (Golden Gate) seeks, by Order to Show Cause, to hold defendant Société Nautique de Geneve (SNG) in contempt, among other relief. SNG, also by Order to Show Cause, seeks to compel Golden Gate to provide SNG with a Custom House Registry (CHR) within fourteen days, or face disqualification from the race. Neither party sought interim relief. The court addresses both applications in this single decision.

Background The America's Cup is a trophy awarded to the winner of a world-renowned yacht race that has been held 32 times since 1851, the first America's Cup race. Initially, Golden Gate commenced an action contending that another challenger, intervenor/defendant Club Nautico Espanol De Vela (CNEV), was not qualified to challenge SNG, the winner of the 32nd race, to compete in the 33rd. The Supreme Court (Cahn, J., retired) heard and considered the matter, then agreed with Golden Gate and vacated CNEV’s challenge.

The decision adjudged that Golden Gate’s challenge was valid and that Golden Gate was the Challenger of Record. The Appellate Division reversed that ruling in a decision reported at 55 AD3d 26 (1st Dept 2008). The Court of Appeals reinstated the Supreme Court’s decision in an opinion decided April 2, 2009, reported at 12 NY3d 248 (2009), and remitted the case back to the Supreme Court.

SNG, thereafter, submitted an Order to Show Cause seeking to disqualify Golden Gate as the Challenger of Record for failure to provide a Custom House Registry (CHR) of its challenge vessel, or alternatively compelling Golden Gate to provide SNO with a CHR. Golden Gate also moved to hold SNG in contempt regarding the date of the race. This court heard argument at a hearing on May 14, 2009 and issued an oral ruling on the record; [I]n regard to Golden Gate Yacht’s application for contempt, I’m directing SNG to hold the race as per the order of the Court of Appeals and Justice Cahn in February as the order required. Should SNG not do so, I am then going to give the other party, Golden Gate, the opportunity to move for contempt.... In regard to SNG’s application, I am stating right now that, although the deed does not require a certain date, the deed dots require that the vessel conform to the challenge dimensions. If the CHR does not conform to the challenge dimensions, it is this Court’s belief, and my direction, that Golden Gate will be disqualified, and I am directing Golden Gate, in good faith, to abide by the deed, to make application for the CHR as soon as possible and provide it as soon as possible.

Exh. Q, Ostrager Affirmation.

Golden Gate now seeks to hold SNG in contempt “for its failure to provide [Golden Gate] its rights as the next America’s Cup challenger of record” and asks for the following additional relief: (I) “directing that SNG cannot change any of the rules and sailing regulations for the next America’s Cup match without ... [Golden Gate’s] mutual consent, (ii) directing SNG to provide Golden Gate ... a copy of the agreements between ISAF, or any of its affiliates, and SNG, or any of its affiliates and/or its racing team..., (iii) directing SNG to cease and desist from efforts to prevent formation of an ISAF jury or otherwise thwart ISAF’s implementation of the rules applicable to the next America’s Cup event, [and] (iv) awarding ... [Golden Gate] its attorney’s fees.”

SNG seeks to compel Golden Gate to provide SNG “with a Custom House registry of its challenge vessel described in its Notice of Challenge (and launched on August 25, 2008, and relaunched on July 6, 2009) within 14 days, or face disqualification.” The court heard argument on both motions on July 21, 2009.

The relevant facts, as evidenced by the parties’ submissions, are as follows: Golden Gate provided its Notice of Challenge to SNG on July 1 1,2007. Pursuant to the Deed, the Notice of Challenge included a certificate as to the name, rig and dimensions of the challenging vessel and stated,’‘ [t]he “Custom House” registry of the challenging vessel will be sent as soon as possible.’’ Exh. B, Ostragar Affirmation. Litigation regarding the competing challenge by CNEV ensued.

SNG has made numerous demands for Golden Gate’s CHR, which under the Deed must be provided “as soon as possible” after the Notice of Challenge. Two years after the challenge, Golden Gate has yet to provide the CHR. Golden Gate, however, has completed

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an approximately 90 foot trimaran (three hulled craft) without movable ballast and power winches used for trimming the sails, which reportedly has already undergone three sessions of sea trials. Golden Gate now represents that it intends to dismantle the boat it has built, that it is building another boat, and that it is not required to provide the CHR until after the Notice of Race (NOR) is issued. The NOR is issued by the defending organization pursuant to the ISAF rules. In response to Golden Gate’s challenge, SNG reportedly has built an approximately 90 foot catamaran (two hulled craft) with movable ballast and power winches for trimming the sails.

According to Golden Gate, unbeknownst to it, there was a change made to the ISAF rules eradicating the rules prohibiting movable ballast and requiring that only manpower be used to trim the sails. Golden Gate asserts that if it had known about the rule change, it would have built a different, more competitive craft. SNG’s position is that the rules can be changed up until the time of the race and that the final pronouncement on the applicable rules is made in the NOR., which also states the venue for the race and other specifics. In any event, the des in question, specifically ISAF 49-54 (including the movable ballast and manpower rules), are explicitly waivable under the rules of the Association des Clubs de Voile de la Region Lemanique (ACVL), a regional association of which SNG is a member. SNG also claims that “it is now standard in the racing of large yachts to allow powered winches for trimming sails and the use of power for movable ballasts.” Ostrager Affirmation.

Golden Gate’s position is that it is unfair to allow the defender to change the rules up to the last minute, that the phrase “mutual consent” included in the Deed also applies to the separate clause defining the default race requirements, and that it cannot possibly provide a CHR (thereby setting its choice of boat in stone) until it knows the rules of the race. SNG argues that there has been no surprise, but regardless, the Deed gives the defender the advantage in this regard.

By letter dated July 22, 2009, SNG provided the court with its confidential agreement with the ISAF for in in camera inspection. Key to this proceeding are the following statements made by SNG’s counsel in that letter: SNG would like to confirm, consistent with our representation made to the Court at the hearing, that the 33rd America’s Cup will not impose any restrictions on competitors’ boats other than the dimensions and requirements contained in the Deed of Gift and the Certificate of Vessel submitted with GGYC’s (Golden Gate’s) Notice of Challenge. SNG will not impose, either in its Notice of Race, or in any other applicable document to be issued by SNG, any further restrictions on the design and equipment of the competing vessels. In particular, rules 49 through 54 of the ISAF Racing Rules of Sailing (“RRS”) will not apply to the 33rd America’s Cup. Second, although we do not believe there is any dispute regarding measurement, SNG will issue precise measurement procedures for the 33rd America’s Cup, on or before August 6, 2009, and before the issuance of the Notice of Race for the next Match. As stated at the hearing, SNG does not have and has never had any intention of using the measurement procedures to disqualify GGYC’s Challenging Vessel by applying unfair or deceptive measurement procedures. SNG’s sole purpose is to make sure that it will be racing against the vessel described in GGYC’s Certificate of Vessel.

Counsel also expressed his client’s willingness to continue with the mediation process and stated that SNG would announce the Northern Hemisphere location for the February 2010 America’s Cup on August 6.

Discussion Analysis of the rights and responsibilities of the parties here begins with the primary operative document, the Deed of Gift (Deed), which sets the framework and defines the rights of America’s Cup participants. The Deed’s origin and content were discussed at length in the leading New York decision involving the America’s Cup, Mercury Bay Boating Club, Inc. v San Diego Yacht Club, 76 NY2d 256 (1990), as well as in the Court of Appeals’ decision reinstating the decision of Justice Cahn in this case: The America‘s Cup, a silver cup trophy, is the corpus of a charitable trust created in the 19th century under the laws of New York. So called because it was won by the yacht America in a race around the Isle of Wight in 185 1, the America's Cup was donated by its six owners to the New York Yacht Club in 1857. The Cup was twice returned to George Schuyler, the sole surviving donor, when questions arose as to the terms of the trust in which the Cup was to be held. Schuyler executed the present Deed of Gift in 1887, donating the Cup to the New York Yacht Club, to be held in trust "upon the condition that it shall be preserved as a perpetual Challenge Cup for the friendly competition between foreign countries.

Pursuant to the Deed of Gift, the holder of the Cup is its sole trustee and is to be succeeded by a competitor who successfully challenges the trustee in a race for the Cup. Unless otherwise agreed by the parties, the terms of the challenge are specified in the deed. The relevant provisions of the deed provide:

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"This Cup is donated upon the condition that it shall be preserved as a perpetual Challenge Cup for friendly competition between foreign countries.

"Any organized Yacht Club of a foreign country * * * shall always be entitled to the right of sailing a match for this Cup, with a yacht or vessel propelled by sails only and constructed in the country to which the Challenging Club belongs, against any one yacht or vessel constructed in the country of the Club holding the Cup. "The competing yachts or vessels, if of one mast, shall be not less that forty-four feet nor more than ninety feet on the load waterline; if of more than one mast they shall be not less than eighty feet nor more than one hundred and fifteen feet on the load waterline.

"The Challenging Club shall give ten months' notice, in writing, naming the days for the proposed races *** Accompanying the ten months' notice of challenge there must be sent the name of the owner and certificate of the name, rig, and following dimensions of the challenging vessel, namely, length on load water-line; beam at load water-line and extreme beam; and draught of water, which dimensions shall not be exceeded; and a custom-house registry of the vessel must also be sent as soon as possible. Centre-board or sliding keel vessels shall always be allowed to compete in my race for the Cup, and no restriction nor limitation whatever shall be placed upon the use of such centre-board or sliding keel, nor shall the centre-board or sliding keel be considered a part of the vessel for any purposes of measurement.

"The Club challenging for the Cup and the Club holding the same may, by mutual consent, make any arrangement satisfactory to both as to the dates, courses, number of trials, rules and sailing regulations, and any and all other conditions of the match, in which case the ten months' notice may be waived.

“In case the parties cannot mutually agree upon the terms of a match, then three races shaIl be sailed, and the winner of two of such races shall be entitled to the Cup. All such races shall be on ocean courses * * * [These ocean courses] shall be selected by the Club holding the Cup; and these races shall be sailed subject to its rules and sailing regulations so far as the same do not conflict with the provisions of this deed of Gift, but without any time allowances whatever. The challenged Club shall not be required to name its representative vessel until at a time agreed upon for the start, but the vessel when named must compete in all the races, and each of such race must be completed within seven hours.”

Mercury Bay, 76 NY2d at 260-262; see Golden Gate Yacht Club v Société Nautique De Geneve, supra, 12 NY3d at 252-256.

After futile attempts at mediation, the parties cannot “mutually agree upon the terms of the match,” so under the Deed, they will race by default according to the rules and regulations of the Club holding the Cup,” in this case SNG. Golden Gate insists that SNO has not afforded Golden Gate its “rights” as a challenger, that SNG may not change any of its Club’s existing rules without Golden Gate’s consent, that SNG must follow the ISAF rules without variance, and that the “jury’’ for the race is to be chosen by the ISAF. SNG argues that Golden Gate should be disqualified because it has failed to provide a CHR of its challenge vessel or it should be ordered to provide one immediately.

Golden Gate’s Order to Show Cause Re: Contempt At the outset, the legal issue the court must determine is whether the donors of the America’s Cup, as the settlors of the trust in which it is held, intended to permit the defender to change the applicable rules after the Notice of Challenge has been issued and up to the time the defender issues the Notice of Race. It appears that the challenger’s main concern is that it built a boat premised on rules it believed were controlling, but a change in the rules has enabled the defender to build a different and faster boat. Stated simply, Golden Gate, the challenger, complains that SNG, the defender, would have the benefit of knowing the design of Golden Gate’s boat prior to designing its own craft. Unfortunately for Golden Gate, there is nothing in the Deed that would disallow either the rules change or the boat design apparently being used by SNG. To the contrary, the Deed gives the defender this very advantage.

As the Court explained in its decision reinstating Justice Cahn’s disqualification of CNEV as a challenger, “[a]s we did in Mercury Bay, we must first examine the plain language of the Deed of Gift and determine, as a matter of law, whether the language can be construed as written and the settlor’s intention determined solely from the unambiguous language of the instrument itself.” Golden Gate, supra, 12 NY3d at 256. The Court in Mercury Bay, which also involved a design issue, focused on the provisions in the Deed concerning design of the race crafts. Specifically, the Mercury Bay Court was asked to decide whether the Deed’s language prohibited catamarans. The Court’s response was that the Deed’s language is clear and unambiguous and encompasses anything the defender or challenger chooses to create as long as it does not violate the Deed’s provisions. Specifically, the Court stated,

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Accordingly, we conclude that the unambiguous language of the Deed of Gift, permitting the defending club to defend the Cup in “any one yacht or vessel” within the specified range of load water-line length, does not require the defender to race a vessel of the same type or “evenly matched “to that of the challenger and does not preclude the defender’s use of a catamaran. Because the deed provisions on these issues are unambiguous, we may not look beyond the four corners of the deed in ascertaining the donors’ intent and therefore may not consider any extrinsic evidence on the meaning of these provisions.

Mercury Bay, supra, 76 NY2d at 269-270.

A blatant example of a design feature that would violate the Deed is an engine used to propel the boat; the Deed permits only vessels “propelled by sails.” The Deed docs not, however, contain any restrictions on ballast or design features regarding trimming the sails. These features are therefore permitted because they are not prohibited by the language of the Deed. Golden Gate also attempts to circumvent the lack of restriction in the Deed by claiming that SNG may not change the rules of the race after the Notice of Challenge has been issued. Golden Gate asserts that allowing rules changes would result in unfair prejudice to the challenger and that it could result in the defender’s engineering a disqualification of the challenger. Again, the court must begin with the language of the Deed. The key provision states, In case the parties cannot mutually agree upon the terms of a match, than three races shall be sailed, and the winner of two of such races shall be entitled to the Cup. All such races shall be on ocean courses * * * [These Ocean courses] shall be selected by the Club holding the Cup; and these races shall be sailed subject to its rules and sailing regulations so far as the same do not conflict with the provisions of this deed of gift, but without any time allowances whatever. The challenged Club shall not be required to name its representative vessel until at a time agreed upon for the start, but the vessel when named must compete in all the races, and each of such races must be completed within seven hours.

Exh. A. The provision is not ambiguous in the least and it applies to this case because the parties have not been able to mutually agree on the terms of the match, instead resorting to litigation. Nothing in the provision prohibits the defending organization from changing its rules, right up to the start of the race, so long as they do not conflict with the Deed.

The court will not read this provision to require that the defending organization is precluded from changing its rules after the Notice of Challenge has been issued. There is no such limiting language in the Deed. To the contrary, the Deed contemplates that the parties will negotiate after the Notice of Challenge is provided, for the purpose of mutual agreement as to the race and rules. Any rules freeze, as advocated by Golden Gate, would be inconsistent with the flexibility the parties would need to negotiate toward a mutually consensual agreement. It is only after the parties have failed to agree that the Deed defaults to the defender’s rules. xxiii Nor does the court find that the change in the rules to permit movable ballast and power winches to trim sails in any way violates the controlling rules. The court refers the parties to the Affidavit of Fred Meyer, the Vice-Commodore of SNG, which sets forth the controlling rules and regulations. Golden Gate has not submitted any evidence directly disputing the rules descriptions and interpretation provided by Mr. Meyer. In short, SNG recognizes that the ISAF Racing Rules of Sailing (RRS) control. Under those rules, specifically RRS 86.1(b), the defending organization may modify the rules, regulations and other specifics of the race through the issuance of the Notice of Race. Under the rules of the ACVL, the regional association of which SNG is a member, RRS rules 49-54 (including the movable ballast and manpower rules) are waived as to multi-hull classes of boats like the boat SNG will sail.

Golden Gate’s arguments based on sportsmanship and fairness are equally unavailing, as well as ironic in light of both parties’ displayed lack of adherence to the Deed’s condition that the America’s Cup race be a “perpetual Challenge Cup for friendly competition” [emphasis added]. As the Court in Mercury Bay found, The question of whether particular conduct is “sporting” or “fair” in the context of a particular sporting event, however, is wholly distinct hm the question of whether it is legal. Questions of sportsmanship and fairness with respect to sporting contests depend largely upon the rules of the particular sport and the expertise of those knowledgeable in that sport; they are not questions suitable for judicial resolution.

Id at 265. As noted above, the applicable rules permit rules changes by the defending organization and do not prohibit the design specifications that SNG has chosen. The court’s inquiry must necessarily end there.

As for the appointment of a jury, the court finds that the method for appointing a jury contained in the confidential agreement between ISAF and SNO is not inconsistent with anything in the Deed or the applicable rules. There is also nothing untoward about the agreement itself. SNG has provided evidence that such agreements are “common practice,” which Golden Gate has not disputed with contrary evidence. The court will, however, direct SNG to provide Golden Gate with a copy of the agreement pursuant to a standard confidentiality agreement that the parties can access from the court’s website.

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SNG ’s Order to Show Cause SNG argues that Golden Gate should be disqualified because it has failed to provide a CHR of its challenge vessel, or it should be ordered to provide one immediately. In its last order, the court directed Golden Gate to provide SNG with a CHR “as soon as possible” in accordance with the Deed’s requirements. The court now clarifies its ruling.

Examining the plain language of the Deed, the court finds that the phrase “as soon as possible” is not ambiguous. It means as soon as is practicable or reasonable after the notice of challenge is provided. See Merriam-Webster’s Collegiate Dictionary (10th ed 2002) (defining “as soon as possible” as “after the time that” and defining “possible” as “practicable”); Travelers Prop. Car. Corp, Y Fusilli, 266 AD2d 48,50 (1st Dept 1999) (construing “as soon as possible” in policy’s notice provision as requiring notice with reasonable promptness). The court finds further that a hearing is necessary to determine exactly what would be practicable or reasonable dependent on the facts and circumstances of this me, a determination that concerns primarily the mechanics of obtaining what the court understands to be a perfunctory document It will be Golden Gate’s burden at the hearing to show when it would be practicable for it to provide a CHR because: (1) it is the challenger’s obligation to obtain the document in the first instance; and (2) the Deed establishes a distinct advantage to the defender as the latter does not have to disclose the specifics of its craft until the time of the start, whereas the challenger must reveal the specifics of its craft in the Notice of Challenge at least ten months in advance. Accordingly, it is ORDERED that Golden Gate’s Order to Show Cause is denied; and it is further ORDERED that SNG’s Order to Show Cause is referred for an evidentiary hearing to be held on Monday, August 10, 2009, at 10:00 a.m. in Part 54 of the Supreme Court, 60 Centre Street, Room 418, New York, New York. Each party will have six hours, inclusive of argument and cross-examination, in which to present evidence regarding the phase “as soon as possible” as used in the Deed of Gift as applied to the circumstances of this case; and it is further ORDERED that defendant SNG shall provide Golden Gate with a copy of its agreement with ISAF on condition that Golden Gate sign a standard confidentiality agreement, as described in the practices of this court set forth on the Supreme Court website.

Date: July 29, 2009 New York, N. Y.

CASE 6: GOLDEN GATE YACHT CLUB v. Société NAUTIQUE DE GENEVA 2009 N.Y. Slip Op. 32163 (N.Y. Sup. Ct. 2009) This case is the result of a Hearing, Decision and Order concerning the term “as soon as possible.”

Date: September 18, 2009 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK: PART 54

DECISION and ORDER

GOLDEN GATE YACHT CLUB, Plaintiff -againstSOCIETE NAUTIQUE DE GENEVE, Defendant CLUB NAUTICO ESPANOL DE VELA, Intervenor/Defendant KORNREICH, SHIRLEY WERNER, J.: Societe Nautique de Geneve (SNG) is the defending holder and plaintiff Golden Gate Yacht Club (Golden Gate) is the challenger for the 33rd America’s Cup (Race). By Decision and Order dated July 29, 2009, the court ordered the parties to appear for an evidentiary hearing on August 10, 2009, to present evidence regarding the phrase “as soon as possible” as used in the Deed of Gift governing the America’s Cup. The phrase speaks to when the challenger must provide the defending holder of the Cup with a Version 1.0

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Custom House Registry (CHR) specific to the vessel the challenger will use in the Race. Thus, the CHR would identify the vessel which is to be raced. Familiarity with the court’s July 29, 2009 Decision is presumed.

At the hearing, plaintiff Golden Gate presented a single witness. Defendant SNG presented no witnesses.

The Hearing Evidence Golden Gate’s witness, Thomas L. Willis, the Director of the Coast Guard’s National Vessel Documentation Center (NVDC) from 1994 to 2008, testified as follows. The Coast Guard issues Certificates of Documentation (CODs) at the NVDC. The COD now substitutes for a CHR and is virtually identical in content. During his tenure, Willis was the final arbiter of the issuance of CODs. He, previously, had served as the chief of the Merchant Documentation and Tonnage Survey branch of the Merchant Vessel and Documentation Division of the Coast Guard, among other positions. He has lectured and testified regarding the issuance of CODs. Willis explained that the primary purpose of a COD is to evidence nationality and that it cannot be issued until construction on a vessel and sea trials are completed. Willis defined “completed” as meaning completed for its intended use, and “sea trials” as the period during which a vessel is tested to see if it is going to meet the requirements for which it was built. The regulations do not require the vessel owner to apply for a COD before the sea trials are done, as long as the vessel is not engaged in coastwise trade or fisheries. Any vessel over five tons and owned by an American is eligible for documentation.

In Willis’ opinion, construction would not be considered completed where: an engine is being installed; the vessel’s manual power system for trimming the sails is being removed; movable water ballast systems are being installed; skin friction reduction technology is being installed; and sea trials have revealed structural features which require re-engineering or changing the volume of the hulls.

An application for issuance of a COD, however, can be filed before the vessel is completed. The COD would not issue, however, until the NVDC has received all of the necessary supporting documentation, including a Builder’s Certificate and a Tonnage Certificate.

A Builder’s Certificate describes the particulars of the build and the identity of the vessel’s owner. It is issued and title is transferred when the vessel is completed. It is not issued until the owner and builder are in agreement that the vessel is completed and delivery has been made. A Tonnage Certificate is required for vessels over 79 feet that are going to undertake a foreign voyage. It can be issued prior to completion if the tonnage surveyor can assess the accuracy of the drawings. Nothing can be out of place that affects tonnage. If the weight changes, a new Tonnage Certificate will be required.

For recreational vessels, it now takes about one month to issue a COD after all of the documents have been received. A COD can be issued within one or two days for commercial vessels. Moreover, the COD can be expedited where the vessel will have to go through Customs.

Willis viewed a video and pictures of Golden Gate’s boat and opined that it is a “vessel” for which a COD could be filed. He described changes that could permissibly be made to a vessel after the COD has been issued as including new sails or new masts, but not structural work. He admitted that changes can be made in bulkheads and the volume of the hull that would not change the 90 foot length on load waterline. If changes are to tonnage, however, a new Tonnage Certificate would be necessary.

A Notice of Challenge in the Race and a COD both contain the name of the vessel, and entries for the length, breadth and depth of the vessel. Although the breadth measurement on the COD is the same as the extreme beam measurement on the Notice of Challenge, the length and depth measurements are different measurements. On a COD the length measurement is closer to the overall length of the vessel, and the depth measurement is the depth of the hull, not just the portion in the water as required on the Notice of Challenge. Also, the COD has the gross and net tonnage, information not on the Notice of Challenge.

In addition to documents already filed in the litigation, the parties submitted the following documents: The Equipment Rules of sailing for 2009-2012 issued by the International Sailing Federation; SNG’s measurement procedures for the 33rd America’s Cup, posted August 6, 2009; a picture of Golden Gate’s vessel, the BOR 90; an on-line release by BMW Oracle about an August 11th “special event” to celebrate its team; a representative COD application; a blank Builder’s Certification; a representative COD; and an additional copy of Golden Gate’s Notice of Challenge.

Argument by Counsel SNG’s counsel argued that when Golden Gate issued the Notice of Challenge they had to have a specific boat in mind with specific dimensions, and that the vessel Golden Gate ultimately races must match what they originally notice. SNG offered to measure Golden Gate’s vessel early and not wait until the date of the match. SNG posted its measuring rules early to dispel any notion that

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they were going to try to disqualify Golden Gate. SNG does not want Golden Gate to be disqualified, just that they meet the 90 by 90 dimensions they included in the Notice of Challenge. Counsel emphasized that SNG wants the COD immediately because they are entitled to it under the Deed and because they want to see whether the boat Golden Gate intends to race matches the measurements provided in the Notice of Challenge. Counsel argued that the challenger’s boat may not be smaller than the originally provided dimensions.

Golden Gate’s counsel argued that the vessel did not have to be in existence at the time of the challenge. Counsel acknowledged that the vessel must not exceed the original dimensions provided in the challenge. Although SNG had said it would not use measurement rules to disqualify the challenger, under SNG’s posted rules the ballast in the boat when it is measured must remain in the same place during the race, which would necessarily exclude movable ballast. Also, the rules of the International Sailing Federation (ISF) and SNG’s measurement rules differ regarding the method for measurement; the ISF measures the waterline from the front of the hull to the end, but under ‘s SNG rules, which refer to the “yacht” as opposed to the “hull,” the rudder would be included in the measurement.

Golden Gate’s Counsel also argued that CODs are used to establish nationality and not to help the defender develop its boat. In the America’s Cup race held immediately after the Deed of Gift was amended to add the “as soon as possible” language regarding provision of a CHR, the CHR was provided seven weeks before the race. In subsequent races the CHR was provided six weeks before the race, then two weeks, then three months. Counsel represented that Golden Gate would try to get the COD by November, that the boat on its website - BOR 90 -- is the boat it will race and that the owner will be Oracle Racing. The boat is not yet completed as Golden Gate is still making changes to be competitive with SNG’s boat. They are adding power for raising, lowering and trimming the sails, as well as movable ballast.

Counsel for the parties agreed to communicate regarding the measurement rules and whether clarification would be necessary. The court offered to intercede at the parties’ request. To date no such request has been made.

Discussion The vessel of an America’s Cup challenger is by nature a yacht undergoing intense technical development. Obtaining a COD, it can be argued, would freeze many of the significant development options for the challenging yacht at the time that measurement is performed. The Deed of Gift requires the challenger to provide the vessel’s critical dimensions in the Notice of Challenge. It does not appear that the COD information is intended to provide the defender with additional significant information, but rather to help confirm that the as-built measurements of the challenging vessel correspond to those in the Notice of Challenge.

The court credits the testimony of Golden Gate’s witness Thomas Willis and finds that: a COD will not be issued until submission of a Builder’s Certificate and a Tonnage Certificate to the NVDC; that a Builder’s Certificate is issued after a vessel and sea trials are completed; that “completed” means completed for intended use; and that construction is not “completed” where a vessel is undergoing structural change, such as adding a movable ballast system or an engine to mechanically trim the sails. Counsel for Golden Gate represented that the vessel undergoing sea trials and identified as BOR 90 is the America’s Cup vessel it intends to race, and that the owner is Oracle, but that a COD is premature because the vessel is undergoing structural changes to add movable ballast and mechanized rigging systems. Under these circumstances the court agrees that the vessel is not completed for purposes of a COD. Although the Deed of Gift, as recognized by the Court of Appeals in Mercury Bay Boating Club, Inc. v. San Diego Yacht Club, 76 NY2d 256 (1990), gives the defender ten months’ notice of the challenger’s critical measurements, it does not preclude the challenger from making structural changes to the vessel that do not increase the dimensions stated in the Notice of Challenge. Willis testified that changes can be made in bulkheads and the volume of the hull that would not change the 90 foot length on load waterline. If Golden Gate does make changes that increase the dimensions from those originally noticed, then the vessel will be disqualified.

Until the vessel is completed, however, a COD cannot be obtained.

The court is bound by the Deed of Gift, a document dating back to the 19th Century and one the court must strictly construe.

Mercury Bay, Id. The Deed provides, in relevant part, that The Challenging Club shall give ten months’ notice, in writing, naming the days for the proposed races * * * Accompanying the ten months’ notice of challenge there must be sent the name of the owner and a certificate of the name, rig, and following dimensions of the challenging vessel, namely, length on load water-line; beam at load water-line and extreme beam; and draught of water, which dimensions shall not be exceeded...

There is no additional language from which the court can attribute the proscription against exceeding the measurements.

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On the other hand, the Deed of Gift provides that should the challenging and defending clubs not “mutually consent” to the details of the Race, the race “shall be sailed subject to the rules and sailing regulations [of the defending club] so far as the same do not conflict with the provisions” of the Deed of Gift. Nowhere in the Deed of Gift is mention made of the ISAF rules. As Willis testified, measurement of length of the vessel on the COD is different from the measurement on the Notice of Challenge, since the means for taking the measurement differs. Similarly, measurement under the ISAF rules may differ from the measurement rules for the 33rd America’s Cup pursuant to the Deed of Gift.

Allowing the challenger to continue construction after it issues the Notice of Challenge, and to reduce the size of the vessel below the noticed measurements, does appear to be inconsistent with the distinct advantage afforded the defender by the Deed’s requirement of ten months’ notice, but the court is mindful of the simpler state of technology that existed when the deed was drafted. There was only so much the challenger could do to its vessel once it learned the details of the defender’s vessel, which under the Deed do not have to be revealed until the date of the match.

It is not only advances in technology, but the unsportsmanlike behavior of Golden Gate that has resulted in substantially reducing SNG’s advantage as originally contemplated by the Deed. Nonetheless, Golden Gate’s actions are not contrary to law or sanctionable in this limited forum. Because Golden Gate’s vessel is still being constructed and the Deed permits the challenger to continue construction after the Notice of Challenge has been issued, the court will not compel Golden Gate to obtain a COD within a specific period of time. To do so would be contrary to the Deed and counterproductive. Willis explained that even if Golden Gate had the necessary supporting paperwork for issuance of a COD and one was issued, subsequent structural changes to the vessel would require issuance of an amended COD. Therefore, issuance of the COD does not freeze the vessel in time. The court does find that Golden Gate must complete its vessel sufficiently in advance of the challenge date to allow for the approximate one month delay in obtaining a COD from the NVDC, and Golden Gate must provide SNG with the actual, final COD at least two weeks prior to the challenge date. Accordingly, it is ORDERED that SNG’s Order to Show Cause why Golden Gate should not be disqualified for failure to provide SNG with a CHR (COD) is denied.

Date: September 18, 2009 New York, N. Y. FN_The court will use the term “Certificate of Documentation,” or “COD” as it is the current 1 name of the required certificate, as opposed to the name “Custom House Registry” originally used in the Deed of Gift

Case 7: GOLDEN GATE YACHT CLUB v. SOCIÉTÉ NAUTIQUE DE GENEVE, 2009 NY Slip Op 32572(U) (N.Y. Sup. Ct. 10/30/2009) 2009 N.Y. Slip Op. 32572 (N.Y. Sup. Ct. 2009) This Case presents the Court DECISION AND ORDER

Date: October 30, 2009 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK: PART 54 GOLDEN GATE YACHT CLUB, Plaintiff -against-

DECISION and ORDER

SOCIETE NAUTIQUE DE GENEVE, Defendant KORNREICH, SHIRLEY WERNER, J.:

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In this next round of motion practice involving The America's Cup race, plaintiff Golden Gate Yacht Club (GGYC) moves for the following relief: (1) to renew its motion for an order "directing that SNG cannot change any of the rules and sailing regulations for the next America's Cup match" (denied by the court in its July 29, 2009 Decision and Order); (2) to enforce the April 7, 2007 Order and Judgment regarding venue for the race (Cahn, J., Retired); and (3) an Order removing the confidentiality designation of the June 5, 2009 agreement between the International Sailing Federation (ISF) and defendant Société Nautique de Geneve (SNG), The court assumes the parties' familiarity with the facts. New evidence or material developments will be summarized as needed.

Discussion A. Motion to Renew CPLR 222 1 (e) provides that, (e) A motion for leave to renew: 1. shall be identified specifically as such; 2. shall be based upon new facts not offered on the prior motion that would change the prior determination or shall demonstrate that there has been a change in the law that would change the prior determination; and 3. shall contain reasonable justification for the failure to present such facts on the prior motion.

Originally, GGYC asked the court to hold SNG in contempt ‘‘for its failure to provide its rights ...” GGYC also asked for an Order “directing that SNG cannot change any of the rules and sailing regulations for the next America’s Cup match without ... mutual consent ....” At that time, the parties focused on SNG’s use of movable ballast and power winches to trim the sails. The court denied the motion and found that SNG’s use of movable ballast and power winches did not violate either the Deed of Gift or the ISAF rules.

Golden Gift is not now asking to renew its motion as to this issue. It has rebuilt its yacht to be competitive with SNG’s, and there will be no further discussion about the use of movable ballast or power winches as a design feature.

The “new facts” raised by GGYC are SNG’s rules of measurement, issued August 6, 2009 and subsequently clarified by correspondence and filings. SNG has acknowledged that under its rules the measurement of the “length on load water-line” would include the rudder and would exclude movable ballast that could be added later. GGYC argues that these rules violate the Deed of Gift, which precludes the defender from changing its rules after the Notice of Challenge has been issued. Additionally, GGYC argues, at the time the Deed of Gift was created, the custom and practice was to exclude rudders from the “length on load water-line” measurement. Further, the addition of ballast after measurement, it argues, would sink the vessel deeper into the water and increase its “length on load water-line” beyond the 90 feet maximum set by the Deed of Gift.

Rules Changes GGYC seeks to renew its challenge to the Court’s prior ruling that nothing in the Deed of Gift precludes the defending organization from changing its rules after the Notice of Challenge has been issued. The Court based its prior decision on the evidence that was presented, particularly the Affidavit of Fred Meyer, who is the Vice-Commodore of SNG. Meyer explained the “hierarchical rule structure” governing sailing regattas around the world. Of particular interest to the court and key to the court’s ruling, was Meyer’s explanation that SNG had been using movable ballast and power winches since at least 1995, and that it is “common practice for other major yacht races throughout the world to modify ISAF RRS 2009-2012 [ISAF rules] and in particular RRS 5 1 [prohibiting movable ballast] and 52 [requiring manual power].” The court understood Meyer’s sworn statements to establish that SNG’s rules, at the time the Notice of Challenge was issued by GGYC, permitted SNG to use movable ballast and power winches.

Based on the evidence presented at that time, the only disputed material issue before the court was whether SNG’s use of power winches and movable ballast violated the Deed of Gift, and not the broader issue of whether the deed permits SNG to change its rules after the Notice of Challenge. The court, now, will clarify its prior ruling to resolve only the narrow issue concerning whether SNG’s waiver of ISAF rules 49 through 54 violated the Deed of Gift. The portion of the ruling addressing the broader issue of when a defender can change its rules, is dicta.

GGYC argues, as it did before, that allowing the defender to change its rules invites the latter to engage in unfair tactics. This argument does not warrant renewal of the prior motion on this issue. In any event, the ISM rules recognize that changes will likely occur, and certain sailing rules depend on the particular venue. Further, SNG has represented to the Court that it “does not have and has never had any intention of using the measurement procedures to disqualify the challenger. The court will take SNG at its word and anticipates that it will not issue rules or sailing instructions that would be inconsistent with the overriding purpose of the Deed of Gift - to set the ground rules for a “friendly competition between foreign countries.”

Inclusion of the Rudder in Measurement

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The Court finds, based on the evidence presented and the arguments of counsel at the October 27, 2009 hearing, that the rudder is not included in measurement of the length on “load water-line” under the Deed of Gift. The deed provides, in pertinent part, that “competing yachts or vessels, if of one mast, shall not be ... more than ninety feet on the load water-line.’’ Under New York law, “[t]he judicial interpretive function is to find the meaning of the testator as expressed in the language used, considered in the light of the attendant circumstances, and effectuate it.” In re Gross, 75 AD2d 53 1 (1 Dept 1980), quoting Matter of Nicol, 24 AD2d 19 191, 197 (1st Dept 1965).

GGYC has submitted substantial evidence, including affidavits from a number of yacht racing experts, that the term “length on load water-line” historically excluded measurement of the vessel’s rudder, New York Yacht Club rules in existence at the time the deed was executed provided that measurement would be “exclusive of any portion of the rudder or rudder-stock.” In addition, the rudder was not included in the measurement procedures for length on load water-line in the 1988 America’s Cup, which measurement procedures SNG claims it relied on for its August 6, 2009 measurement procedures. SNG has not submitted any persuasive contrary evidence. SNG may not include rudders in measurement of the “length on load water-line.” In light of this ruling, the Court does not need to reach the broader issue of whether SNG can change its rules to include rudders in the measurement.

Remaining Issues The Court requires additional expert guidance in order to decide the following issues: (1) How “load water-line” is measured in an America’s Cup race, including but not limited to whether SNG can exclude movable ballast from the measurement and whether the same procedures are used when dealing with a catamaran and or trimaran; (2) The safety of holding the race off the coast of Valencia in February, 2010; (3) When the Notice of Race and other rules of the race are customarily issued in an America’s Cup challenge, including whether they are changed after the Notice of Challenge; (4) When the panel of jurors is customarily appointed in an America’s Cup challenge; and (5) Whether the contract between ISM and SNG provides for an independent and objective panel of jurors, and by which rules such a panel of jurors is bound in an America’s Cup challenge.

The Court will hold a hearing at 10:00 A.M. on Wednesday, November 4, 2009, at which time the parties shall each produce an independent expert who is not affiliated with either party and who has sat on an America’s Cup jury in the past. The parties’ appointed experts shall confer prior to the hearing and choose a third, independent expert who is not affiliated with either party and who has also sat on an America’s cup jury in the past. All three experts shall appear at the hearing and be prepared to testify regarding the above issues.

All other issues raised in the motion and opposing papers were resolved by the Court on the record at the hearing on October 27, 2009.

Finally, all issues in regard to venue which have been raised in multiple letters to the court on October 29 and 30, 2009, shall be heard on the date of the hearing. Accordingly, it is ORDERED that GCYC’s motion to renew and for other relief is continued until after a further hearing; and it is further ORDERED that the patties shall appear at 10:00 A.M. in Part 54 of the New York Supreme Court, Commercial Division, 60 Centre Street, Room 418, New York, New York. for a hearing pursuant to the court’s directions in this Decision and Order.

New York, N. Y.

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CASE 8: GOLDEN GATE v. SOCIÉTÉ NAUTIQUE 68 A.D.3d 552 (N.Y. App. Div. 2009) APPEAL

Appeal 12/15/2009 GOLDEN GATE YACHT CLUB, Respondent -againstSOCIETE NAUTIQUE DE GENEVE, Appellant, et al, Intervenor/Defendant Sullivan & Cromwell LLP, New York (Robert J. Giuffra, Jr. of counsel), for appellant.

Boies, Schiller & Flexner LLP, Armonk (David Boies of counsel), for respondent.

Cleary Gottlieb Steen & Hamilton LLP, New York (Jeffrey A. Rosenthal of counsel), for amicus curiae.

Order, Supreme Court, New York County (Shirley Werner Kornreich, J.), entered October 30, 2009, which granted plaintiff Golden Gate Yacht Club's (GGYC) motion for an order declaring invalid Societe Nautique de Genève's (SNG) selection of Ras Al Khaimah, United Arab Emirates (RAK) as the venue for the 33rd America's Cup yacht race, unanimously affirmed, without costs. Order, same court and Justice, entered November 4, 2009, which, inter alia, ruled that, under the Deed of Gift governing the race, a yacht's "rudders" may not be included in measuring its length on load water-line, unanimously affirmed, without costs.

Concerning the October 30, 2009 order, by order filed April 7, 2009 (Golden Gate Yacht Club v Societe Nautique de Genève, 12 NY3d 248 [2009]), the Court of Appeals reinstated a May 12, 2008 order of Supreme Court which provided, insofar as pertinent, that (1) "the location of the match shall be in Valencia, Spain or any other location selected by SNG [or agreed to by the parties], provided SNG notify GGYC in writing not less than six months in advance of the date set for the first challenge match race of the location it has selected for the challenge match races," and (2) that the date of the first race "shall be the date ten calendar months from the date of service of a copy of this order, with notice of entry, upon the attorneys who have appeared herein," or such other date as might be agreed to by the parties (2008 NY Slip Op 32296[U], [2008, Cahn, J.]). Also pertinent is the Deed's requirement that races be conducted between May 1 and November 1 if in the Northern Hemisphere and between November 1 and May 1 if in the Southern Hemisphere. Measuring 10 months from the Court of Appeals' April 7, 2009 order, the first race would have to be conducted on February 8, 2010. Nevertheless, on April 23, 2009, SNG informed GGYC that the first race was to be conducted on May 3, 2010, and that SNG would notify GGYC before December 3, 2009 of a Northern Hemisphere venue. GGYC moved to hold SNG in contempt, arguing that, by virtue of the April 7, 2009 order, the first race had to be conducted on February 8, 2010, and that SNG had to notify GGYC of the location of the races no later than August 8, 2009. SNG responded that it set the date in May, rather than February, because GGYC's Notice of Challenge expressly put forth a Northern Hemisphere challenge and, under the Deed, a Northern Hemisphere race could not take place earlier than May. On May 14, 2009, the court directed SNG to hold the races in February 2010, "as per the order of the Court of Appeals." On August 5, 2009, SNG announced the selection of RAK, which is in the Northern Hemisphere, as the venue of the races. GGYC again objected, arguing that, by virtue of the April 7, 2009 order, and notwithstanding the Deed's requirement that a February race be conducted in the Southern Hemisphere, the races had to be conducted in Valencia, Spain, which is in the Northern Hemisphere, in February 2010, absent agreement otherwise between the parties or SNG's selection of an alternative Deed-compliant location by August 8, 2009. The motion court correctly rejected SNG's selection of RAK. The April 7, 2009 order of the Court of Appeals does not explicitly state that it intended to remove entirely the Deed's hemisphere requirements, or otherwise indicate, as SNG argues, that it was a compromise between GGYC's claimed right to have the race conducted as soon as 10 months after issuance of the order and SNG's claimed right to select a Northern Hemisphere venue.

Accordingly, the order should be read as carving out an exception to the Deed's hemisphere requirements in the case of Valencia, and the phrase "or any other location selected by SNG" should be read as "or any other Deed-compliant location selected by SNG." RAK, which is in the Northern Hemisphere, is not a Deed-compliant location for a February race.

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Concerning the November 4, 2009 order on appeal, the court correctly found, based on extrinsic evidence, that the Deed excludes rudders for the purpose of measuring the length on load water-line. The Deed, which provides, in relevant part, that the competing vessels, "if single-masted, must measure between 44 and 90 feet on the load water-line," and states that neither the "center-board" nor "sliding keel" shall be considered part of the vessel for any purposes of measurement, but does not define "load water-line," which is clearly a term of art with specialized meaning in the sport of sailing, is ambiguous as to whether rudders should be considered in measuring the length on load water-line. The mere fact that the Deed expressly only states that the center-board and sliding keel shall not be considered in the measurement does not necessarily mean that all other parts of the vessel, including the rudders, were intended to be considered in making that measurement. Given this ambiguity, the court properly relied on undisputed extrinsic evidence, including New York Yacht Club rules extant at the time the 1887 Deed was settled, showing that length on load water-line is typically measured "exclusive of any portion of the rudder or rudder-stock."

We have considered the remaining contentions and find them unavailing.

Concur—Friedman, J.P., Sweeny, Freedman and Abdus-Salaam, JJ. [Prior Case History: 2009 NY Slip Op 32163(U).]

CASE 9: GOLDEN GATE YACHT CLUB v. GENÈVE 2007 N.Y. Slip Op. 52496 (N.Y. Sup. Ct. 2007) The following case finds that CNEV’s challenge was invalid and GGYC was the Challenger of Record

Supreme Court, New York County Golden Gate Yacht Club, Plaintiff, -againstSociété Nautique De Genève, Defendant Club Nàutico Español De Vela, Intervenor-Defendant.

602446/07 Plaintiff was represented by Latham & Watkins, LLP, 885 Third Avenue, New York, NY 10022, (212) 906-1200, James V. Kearney, Esq. Defendant was represented by White & Case, LLP, 1155 Avenue of the Americas, New York, NY 10036, (212) 819-8200, David G. Hille, Esq., Adam Wactlar, Esq. and Owen C. Pell, Esq. Intervenor-defendant Club Nautico Espanol de Vela was represented by Debevoise & Plimpton, LLP, 919 Third Avenue, New York, NY 10022, Jeremy Feigelson, Esq., of counsel, David W. Rivkin, Esq. and Catherine M. Doll, Esq. HERMAN CAHN, J.: Motion sequence numbers 001, 002, 003 and 004 are consolidated for disposition.[FN1] In motion sequence number 001, plaintiff Golden Gate Yacht Club (GGYC) moves for expedited discovery and an expedited trial.

Plaintiff also seeks a preliminary injunction enjoining defendant Société Nautique de Genève (SNG) to provide GGYC with the SNG sailing rules governing, and identify SNG's selection of the location of, the match between GGYC and SNG noticed in GGYC's challenge.

In motion sequence number 002, non-parties Reale Yacht Club Canottieri Savoia (RYCCS) and Mascalzone Latino (collectively, Amici) move for leave to file an amici curiae brief regarding SNG's motion for summary judgment and GGYC's cross motion for summary judgment.

In motion sequence number 003, SNG moves for summary judgment dismissing all claims alleged by GGYC in this action, CPLR 3211 (a) (1) and (a) (7). GGYC cross-moves for summary judgment, CPLR 3211 (c) and 3212.

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In motion sequence number 004, intervenor-defendant Club Nàutico Español de Vela (CNEV) moves for an order dismissing GGYC's claims. In its initial moving papers, CNEV stated that it would not be submitting its own memorandum of law but, instead, relying upon and adopting SNG's memoranda of law in support of SNG's own motion for summary judgment. Nevertheless, CNEV submitted its own reply memorandum of law.

Background The America's Cup is a trophy awarded to the winner of a world-renowned yacht race that has been held 32 times since the first America's Cup race held in 1851. Although many yacht clubs are able to, and usually do, join in the race, the document governing the race permits the defending winner (Defending Club) and the challenging club (Challenger of Record) to agree upon the terms of the forthcoming race. Defendant SNG, the winner of the last America's Cup, accepted a challenge from intervenor-defendant CNEV for the 33rd America's Cup race, and thereby purported to make CNEV the Challenger of Record. Thus, CNEV and SNG would be able to set the terms and conditions that will govern the next America's Cup race.

Dissatisfied with the agreed-upon terms for the 33rd race, GGYC commenced this action contending that CNEV, a newly-formed yacht club that is not qualified to be designated as the Challenger of Record in the forthcoming America's Cup competition and that, therefore, the acceptance of CNEV's challenge should be vacated.

The leading New York decision, indeed one of the few reported New York State decisions involving the America's Cup, is the Court of Appeals decision, Mercury Bay Boating Club v San Diego Yacht Club (76 NY2d 256 [1990]) (Mercury Bay).[FN2] As discussed therein, the silver trophy cup, denominated the America's Cup (Cup), is the corpus of a charitable trust created in the mid-1800's under the laws of New York (Mercury Bay, 76 NY2d at 260). The yacht America was the winner of a yacht race held in 1851 around the Isle of Wight. In 1857, the six Cup owners donated the silver trophy to the New York Yacht Club. The club returned the Cup to George Schuyler, as the then sole-surviving Cup owner, because of questions about the terms of the trust. Schuyler again donated it to the New York Yacht Club, to hold the Cup in trust pursuant to the terms of the present Deed of Gift (Deed), dated October 24, 1887 (Mercury Bay, 76 NY2d at 261). The Deed was amended by two Orders of this Court, dated December 17, 1956, and April 5, 1985.

The Cup was donated on the condition that the Cup: "shall be preserved as a perpetual Challenge Cup for friendly competition between foreign countries."

The Deed governs how such "friendly competition" challenges are made for the Cup, who may be a qualified Challenger of Record, and the manner in which matches for the Cup are to proceed.

Mercury Bay involved the successful defense by the San Diego Yacht Club of the America's Cup race held in 1988, using a catamaran vessel against a slower monohull vessel used by the challenger, the Mercury Bay Boating Club. The Mercury Bay club argued that, although the catamaran vessel technically fell within the Deed's express limitations, its use violated the Deed's "spirit," as exemplified by both its terms and various items of extrinsic evidence. The Court deemed that the gravamen of Mercury Bay's complaint was the alleged inherent unfairness of a race between a multihull yacht and a monohull yacht, regardless of the donors' intent, basing the measure of fairness upon contemporary sporting practices and sportsmanship standards (id. at 265).

The Court of Appeals rejected Mercury Bay's argument and held that the Deed's unambiguous language, permitting the defender to defend the Cup in "any one yacht or vessel" within the specified range of load water-line length, did not require the defender to race a vessel of the same type or evenly-matched to that of the challenger, and it did not preclude the defender's use of a catamaran (Mercury Bay, 76 NY2d at 269). The Court expressly declined to consider whether the San Diego club's conduct was "unsportsmanlike" and "unfair," finding that the Deed appropriately left such issues to yachting experts (id. at 271). Rather, the Court limited itself to strictly applying the terms of the Deed. This court is bound to follow that ruling and apply the provisions of the Deed to this dispute.

As is relevant here, the Deed specifies the eligibility requirements that entitle a yachting club to be designated as Challenger of Record: Any organized Yacht Club of a foreign country, incorporated, patented, or licensed by the legislature, admiralty, or other executive department, having for its annual regatta an ocean water course on the sea, or on an arm of the sea, or one which combines both, shall always be entitled to the right of sailing a match of this Cup, with a yacht or vessel propelled by sails only and constructed in the country to which the Challenging Club [Challenger of Record] belongs, against any one yacht or vessel constructed in the country of the Club holding the Cup. (Emphasis added).

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The Challenger of Record is to provide 10-months' written notice, naming the days of the proposed races, as well as providing technical information about the challenging vessel. Significantly, the Challenger of Record and the Defending Club: may, by mutual consent, make any arrangement satisfactory to both as to the dates, courses, number of trials, rules and sailing regulations, and any and all other conditions of the match, in which case also the ten months' notice may be waived.

When the Defending Club and the Challenger of Record agree upon the match terms, pursuant to this "mutual consent" process, they then issue a publication (a protocol) setting forth such terms. The Deed also provides that if the parties cannot mutually agree upon the match terms, then three races are to be sailed and the winner of two of such races is then entitled to the Cup. The Deed sets forth the terms of such races, and provides that: when a challenge from a Club fulfilling all the conditions required by this instrument has been received, no other challenge can be considered until the pending event has been decided.

SNG, through Team Alinghi, one of its teams, is the Cup's current Defending Club and trustee, having won the 31st Cup on March 2, 2003 and having successfully defended its title in the 32nd Cup held on July 3, 2007. GGYC was the Challenger of Record for the 32nd America's Cup, and SNG and GGYC publicly released the SNG-GGYC protocol for the 32nd Cup two days after SNG won the 31st America's Cup in March 2003.

Initially, the Spanish sailing federation Real Federacion Espanola de Vela (RFEV) sought to become the Challenger of Record for the 33rd America's Cup. Although RFEV participated in the 32nd America's Cup, opposition to RFEV becoming Challenger of Record for the 33rd America's Cup match arose, on the ground that it was a federation of yacht clubs, not a yacht club itself. RFEV's lawyers apparently considered the possibility of a dispute to RFEV's right to challenge for the Cup, and advised RFEV to incorporate a club to formalize the challenge for the 33rd America's Cup. Thereupon, RFEV incorporated CNEV in order to avoid further controversy about RFEV's capacity to become the Challenger of Record under the Deed. According to Manuel Jose Chirivella Bonet, chairman of CNEV and vice-chairman of RFEV, CNEV is a private Spanish sports club with unlimited duration, that was organized on June 19, 2007 and registered with the Registry of Sports Organizations of the Valencian Community (Registro de Entidades Deportivas de la Comunitat Valenciana) on June 28, 2007 (see also Monasterio Aff). Bonet states that CNEV's purpose is to promote sailing practices through the organization of national as well as international regattas within the national territory and to organize at least one regatta per year on the open sea, as reflected in Chapter 1 of its articles of incorporation.

After its formation, CNEV challenged SNG for the 33rd America's Cup, by delivering a Notice of Challenge, dated June 29, 2007, contending that it was a valid challenger pursuant to the Deed, in that it was an organized, foreign yacht club having an annual regatta. On July 3, 2007, SNG accepted CNEV's challenge.

On July 5, 2007, SNG and CNEV publicly released the "The Protocol Governing the 33rd America's Cup" (Protocol). The Protocol contains an arbitration provision. As of the date of the submission of the motion papers, four clubs had signed onto the Protocol, including: the Royal Cape Yacht Club of South Africa; the Royal Thames Yacht Club of England; the Royal New Zealand Yacht Squadron of New Zealand; and the Deutscher Challenger Yacht Club e. V. of Germany. GGYC has not signed on to the Protocol.

GGYC contends that CNEV is not a valid Challenger of Record because it is not an "organized" yacht club and it has not yet held an annual regatta. According to GGYC, RFEV controls CNEV, an entity that has no vessels. Moreover, apart from the five RFEV directors that executed CNEV's incorporation and registration papers on June 19, 2007, CNEV has not identified any of its members, it has no telephone number other than the telephone number of the base facility of the racing team (Desafio Espanol) and does not have a website. SNG disputes these assertions only insofar as GGYC concludes that such circumstances thereby cause CNEV to be a "phantom club."

Initially, SNG contended that CNEV has held two regattas; an "Optimist" race, held in Santander, Spain, on July 14, 2007, and the Vuelta Espana a Vela race, from September 3 to September 22, 2007, which it co-sponsored. The Optimist race was for children, and CNEV later stated that it did not consider such race as complying with the annual regatta requirement of the Deed. The Vuelta Espana a Vela race was held subsequent to the date of CNEV's and GGYC's respective challenges. CNEV has not taken the position that either of these qualifies as an annual regatta pursuant to the Deed. According to CNEV's chairman, Bonet, CNEV is scheduled to hold its annual regatta, the "Club Nautico Espanol de Vela Primera Regatta, Trofeo DesafÍo Espanol," on open water off Valencia, Spain in November 2007.

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On July 11, 2007, GGYC issued its own Notice of Challenge for the 33rd America's Cup. GGYC contends that it is the valid Challenger of Record in that it: is incorporated in the United States, in the State of California; maintains a membership of more than 200 members; operates as a yacht club; and has objectives consistent with the furtherance of yachting activities. Moreover, it holds an annual regatta the Sea Weed Soup Perpetual Trophy that, among other GGYC regattas, is, and has been, held annually on an arm of the sea, namely, the San Francisco Bay. Thus, according to GGYC, it is an "organized Yacht Club" fulfilling all the conditions that the Deed requires.

Because of this controversy, on July 20, 2007, SNG initiated proceedings under the arbitration provisions of the Protocol, seeking a ruling from the panel set up under the Protocol (Panel) as to the validity of CNEV's challenge.[FN3] The Panel asked GGYC to participate in the proceedings, stating that it would accept GGYC's submissions, even if GGYC elected not to submit to the Panel's jurisdiction. GGYC refused to do so, contending that only signatories, to what it characterizes as the "illegal" Protocol, have the right to participate in the arbitration. On September 10, 2007, the Panel issued its decision determining that CNEV was a valid Challenger of Record.

On the same day that SNG initiated the arbitration, GGYC commenced this action, alleging that SNG has accepted a challenge that is invalid under the Deed from CNEV, a brand-new yacht club. It claims that the challenge was not valid because CNEV is not an organized yacht club, and has never had an annual regatta two requirements under the Deed prior to its creation for the specific purpose of collaborating with SNG. The complaint contains two causes of action. The first is for breach of fiduciary duty, alleging that, as trustee, SNG was and is under a duty to enforce the terms of the trust instrument, i.e., the Deed. Allegedly, SNG breached its duty of care, loyalty, good faith and honesty. The complaint also contains allegations that SNG engaged in self-dealing, by accepting CNEV's challenge and by entering into the Protocol without engaging in the consensual process required by the Deed's mutual consent clause.

The second cause of action is for breach of the Deed. Plaintiff alleges that CNEV's Notice of Challenge and challenge, which SNG accepted, was invalid in that it failed to conform to the terms of the Deed, and the resulting Protocol was not the product of the required mutual consent process.

GGYC seeks: (1) a declaration that CNEV's purported challenge and the Protocol are void; (2) a declaration that GGYC's challenge is valid; (3) judgment in favor of GGYC and against SNG (i) enjoining SNG from promulgating rules and regulations pursuant to the Protocol, and (ii) directing SNG to reject CNEV's challenge; and (4) judgment in favor of GGYC and against SNG enjoining SNG to (i) accept GGYC's notice of challenge and (ii) to implement the terms of the Deed by participating with GGYC in the establishment of a protocol through a consensual process and, failing that, to proceed with the match under the rules expressly set forth in the Deed.

SNG argues that CNEV is a legitimate Challenger of Record, that it has accepted CNEV's legitimate challenge, and is thus prohibited from entertaining another Challenger of Record until the completion of CNEV's challenge. It argues that CNEV is organized as a yacht club with board rules, dues and other indicia of a legitimate legal entity. Moreover, it is incorporated under Spanish law and fully registered with, and licensed by, the appropriate Valencian and Spanish authorities. Moreover, CNEV is committed to holding an annual regatta on the sea.

According to Amici, RYCCS, a yacht club that was established in 1893, with 860 members, and represented by Mascalzone Latino, would like to participate in the next America's Cup, but it cannot make adequate commercial and technical preparations until the controversy at issue here is resolved.

Amici argue that the Protocol contravenes the core terms of the Deed, which provides that the Cup "shall be a perpetual Challenge Cup." Amici contend that the Protocol eliminates challenger rights and grants SNG unchecked authority. Specifically, Amici argue that: (1) SNG, through America's Cup Management (ACM), the "Event Authority," that SNG controls, possesses unilateral power to disqualify a challenging team for disputing any provision of the Protocol and possesses powers and rights, through its control of ACM, that significantly exceed those of any defender in any other protocol in the history of the America's Cup; (2) the Protocol effectively eliminates any challenger representation; (3) SNG, as the Defending Club, through ACM, is given the power to establish unilaterally the rules for all events; and (4) SNG has the unprecedented option to participate wholly or partly at its discretion in the "Trials" and "Challenger Selection" other than the final trial between the two challengers to select a challenger for the match.

SNG argues that the Amici memorandum is irrelevant to the issues in this action because, as recognized by both GGYC and SNG, the subject of the summary judgment motions at issue is the validity of CNEV's challenge, and not the terms of the Protocol. As such, SNG contends, Amici's memorandum is merely a list of items that it would like to see changed in the Protocol.

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Discussion As a preliminary matter, the motion by Amici for leave to file an amici curiae brief regarding SNG's motion for summary judgment and GGYC's cross motion for summary judgment is granted. Amici represents a yacht club that has participated in the 31st and 32nd America's Cup races. The only opposition to its motion is based on the assertion that participation by Amici in any formal hearing as to the validity of CNEV's challenge could render the proceedings cumbersome, something that the court need not presently consider.

CNEV's Challenge To qualify as the Challenger of Record under the Deed, the would-be challenger must be an "organized Yacht Club of a foreign country, incorporated, patented, or licensed by the legislature, admiralty, or other executive department, having for its annual regatta an ocean water course on the sea, or on an arm of the sea, or one which combines both . . . ." GGYC's contention that CNEV does not meet these requirements, in that it neither is an organized Yacht Club nor has an annual regatta on the sea or arm of the sea is persuasive as to the latter requirement and, thus, dispositive.

To qualify under these requirements, the club must be incorporated. It is inconsequential that RFEV may have incorporated CNEV to formalize the challenge because of the likelihood that RFEV's own challenge would be disputed. That, by itself, does not disqualify CNEV from qualifying as Challenger of Record.

However, being incorporated is not, by itself, sufficient; it must have additional attributes that make it an "organized Yacht Club."

Although the term "organized" often refers to the nature of an entity's legal existence or formation, here the donors contemplated additional indicia of a yachting club. This is evident from the corporate seal of the New York Yacht Club itself, the Cup's original donee, which states that the club was organized in 1844 and incorporated in 1865 (Ehman Aff, Exh EE). SNG's dictionary reference (A Dictionary of Law 739 [William C. Anderson ed. 1889] [attached to SNG's Reply Br]) does not prove otherwise. It states that "[o]rganizing an incorporation refers to the choice and qualification of offices necessary for the transaction of business," thereby implying that organizing a yacht club is not synonymous with incorporating a yacht club. Thus, SNG's argument that incorporating, adopting by-laws and assigning roles and responsibilities for its officers and directors (SNG Reply Br at 7) is sufficient to constitute an organized yacht club under the Deed is unconvincing.

Nevertheless, CNEV arguably complies with the requirement that the club be a legally recognized entity of its jurisdiction with certain additional attributes. CNEV is a private Spanish sports club with unlimited duration, registered with the Registry of Sports Organizations of the Valencian Community. According to Bonet, chairman of CNEV and vice-chairman of RFEV, CNEV's purpose is to promote sailing practices through the organization of national as well as international regattas within the national territory and to organize at least one regatta per year in the open sea, as reflected in Chapter 1 of CNEV's articles of incorporation. The club is negotiating a collaboration agreement with the Center of Sailing Training in Santander where the Spanish Sailing Olympic Team is trained with the Optimist race as its first event and denoting the promotion of sailing among young people as among of its priorities.

Bonet also states that CNEV expects to be listed in due course on the website of the Valencian Community Sailing Federation.

Whether these attributes are sufficient in the absence of vessels, members, and a telephone number, etc. to constitute a "Yacht Club" under the Deed would require an analysis of custom and practice in the sport, as well as a hearing. Such is not necessary, however. Although the meaning of the term "organized" in the context of a sporting club is unclear as to the club's required attributes, the Deed expressly requires one specific attribute, namely, that the club have an annual regatta. CNEV's failure to comply with this requirement nullifies its purported role as Challenger of Record of the 33rd America's Cup. GGYC argues that the phrase "having for its annual regatta" means that the club has held a regatta in the past, and will continue to do so in the future. According to SNG and CNEV, the intention to hold a regatta in the future and to continue such regatta annually, constitutes "having" an annual regatta.

In interpreting a trust, courts look to the intent of the settlor as expressed in the trust instrument (Matter of Preiskel, 275 AD2d 171 [1st Dept 2000], citing Mercury Bay, 76 NY2d at 267, appeal dismissed 96 NY2d 812 [2001]). To ascertain that intent, the court construes the phrase at issue "having for its annual regatta on the sea or arm of the sea" by affording it its plain and natural meaning (Mercury Bay, 76 NY2d at 261). That phrase is plainly understood to mean that it is an on-going activity; the activity has taken place and is continuing. It implies that the organization has had one or more regattas in the past, and will continue to have them in the future. SNG's and CNEV's interpretation strains the language of the Deed beyond its reasonable and ordinary meaning (AIU Ins. Co. v Robert Plan Corp.,44 AD3d 355 [1st Dept 2007]; Innophos, Inc. v Rhodia, S.A., 38 AD3d 368 [1st Dept 2007]).

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Although SNG and CNEV contend that CNEV complies with the annual regatta requirement, they do not contend that CNEV had held an actual regatta at the time of its Notice of Challenge, dated June 29, 2007, or by GGYC's subsequent challenge on July 11, 2007.

According to Bonet, CNEV is planning to hold its first annual regatta called the "Club Nautico Espanol de Vela Primera Regatta, Trofeo DesafÍo EspaÑo" on open water off Valencia, Spain in November 2007.

To effectuate the interpretation advocated by SNG and CNEV, the Deed could have stated: "having, or intending to have, for its annual regatta." It would be entirely natural for the donors to have included such language into the Deed if that were their intent to do so.

However, the phrase "having historically held an annual regatta," a phrase suggested by CNEV to effectuate GGYC's interpretation (CNEV Reply Br at 5), would imply that a yacht club could qualify if it had held an annual regatta, but need not be continuing to do so. That, too, is not the meaning of the Deed provision at issue. The court must not construe a contractual provision in such a way that would distort its apparent meaning (Matter of Matco-Norca, Inc., 22 AD3d 495 [2d Dept 2005]). Furthermore, CNEV impliedly acknowledged that it does not come within the ordinary meaning of the Deed provision, in that it states that "CNEV is committed to having' an annual regatta this year and in the future" (CNEV Reply Br at 6).

Because the Deed provision at issue is unambiguous, the court need not look beyond the Deed's four corners in ascertaining the donors' intent. Thus, it may not consider extrinsic evidence on the meaning of this provision (R/S Assoc. v New York Job Dev. Auth., 98 NY2d 29 [2002], rearg denied 98 NY2d 693 [2002]; Mercury Bay, 76 NY2d at 270). The court notes, however, that GGYC's interpretation effectuates the apparent expectations of the donors as set forth in the Deed. The Deed contemplates that the Defending Club and the Challenger of Record will, by mutual consent, make all arrangements as to the dates, courses, number of trials, rules and sailing regulations, and all other conditions of the match. An established yacht club that has already held an annual regatta is more likely to better understand the ramifications of the race and, thus, be better able to negotiate the terms of a match terms that the other participants must adhere to than a newly-formed club that has not yet held a regatta. Hence, the court's finding comports with a practical interpretation of the expression of the parties thereby realizing their reasonable expectations (Sutton v East Riv. Sav. Bank, 55 NY2d 550 [1982]; American Bldg. Maintenance Co. of NY v Solow Mgt. Corp., 7 AD3d 331 [1st Dept], lv denied 4 NY3d 702 [2004]).

Furthermore, although the arbitration Panel concluded that CNEV was a valid Challenger of Record, that determination is not binding on this court, since there is nothing in the Deed that mandates that disputes be resolved by arbitration. GGYC is not a party to the Protocol; it was not bound to participate in the arbitration and refused to participate. Unless a party has entered into an agreement to arbitrate, and the agreement expressly covers the subject matter of the particular dispute, that party will not be compelled to forego its right to seek judicial relief (Bowmer v Bowmer, 50 NY2d 288 [1980]; Matter of Eastern Mins. Intl. Cane Tenn., 274 AD2d 262 [1st Dept 2000], lv denied 96 NY2d 702 [2001]). SNG concedes that GGYC is not bound by the arbitration decision, or that the arbitration supplants this court's authority to resolve the issues at hand.

GGYC's decision to decline the "invitation" to participate in the arbitration is understandable in that the Protocol for the 33rd race, drafted by SNG and CNEV, gave these two clubs the right to dismiss and replace the members of the Panel at their discretion at any time.

GGYC's Challenge Consequently, GGYC argues that SNG is required to accept its July 11, 2007 Notice of Challenge, citing the following provision of the Deed: when a challenge from a Club fulfilling all the conditions required by this instrument has been received, no other challenge can be considered until the pending event has been decided.

GGYC argues that it is undisputed that it, the Challenger of Record for the 32nd America's Cup, fulfills all the conditions required by the Deed. Moreover, only when the Defending Club receives a challenge from a qualifying club is it prohibited from considering a subsequent challenge. Thus, that CNEV may someday comply with the conditions of the Deed has no bearing on GGYC's valid challenge that it issued after the date of CNEV's invalid challenge, but prior to such time as CNEV may fulfill the conditions of the Deed.

Neither SNG nor CNEV argues that GGYC fails to qualify as an organized foreign yacht club.

SNG argues, instead, that GGYC is not entitled to the equitable relief sought an injunction and a declaration that it should be designated as Challenger of Record because of the doctrine of unclean hands. This defense is not applicable, however, unless the

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plaintiff is guilty of immoral, unconscionable conduct, and then only when the wrongful conduct relied upon directly relates to the subject matter, and the party relying on it was injured by the conduct (National Distillers & Chem. Corp. v Seyopp Corp., 17 NY2d 12 [1966]; 390 W. End Assoc. v Baron, 274 AD2d 330 [1st Dept 2000]). The acts allegedly constituting unclean hands do not meet these requirements.

SNG first argues that GGYC's representative, Russell Coutts, sent a letter dated September 21, 2007, to Brad Butterworth of Team Alinghi, stating that the essence of this action is not the validity of CNEV's challenge but, rather, the alleged unfair Protocol, which is "why the lawsuit was filed in the first place." This does not constitute immoral and unconscionable conduct that might otherwise constitute unclean hands. Moreover, the statement that the real issue is the Protocol is not inconsistent with the claim that CNEV is not a proper challenger. As discussed above, GGYC argues, persuasively, that one of the purposes to be accomplished through the designation of a legitimate Challenger of Record (i.e., one that complies with the Deed requirements) is that the defender and the Challenger of Record are more likely to seriously negotiate the terms of the Protocol. This is not meant to imply that SNG and CNEV did not seriously negotiate the Protocol, only that a challenge to the legitimacy of the Challenger of Record is not inconsistent with a challenge to the Protocol.

As a second example of unclean hands, SNG argues that GGYC's has ignored precedent i.e., a prior competition in which GGYC accepted the Deutscher Challenger Yacht Club, a then newly-formed club organized to challenge for the 32nd Cup when GGYC was the Challenger of Record. This, too, does not constitute unclean hands. Moreover, the Deutscher Challenger Yacht Club was not the Challenger of Record, so there would be less reason to challenge its entry in the race in that it did not engage in the mutual consent process of negotiating the protocol.

As a third example, SNG argues that GGYC is attempting to ignore the Panel's arbitration decision regarding CNEV's challenge.

However, the court has found that GGYC was correct in ignoring the arbitration. The assertion that this somehow constitutes unclean hands is inexplicable.

Furthermore, SNG failed to allege that the claimed wrongful behavior, described above, has caused it prejudice, thereby further nullifying this defense (see Wertheimer v Cirker's Hayes Stor. Warehouse, 300 AD2d 117 [1st Dept 2002]).

Breach of Fiduciary Duty Finally, the court grants SNG's motion to the extent of dismissing the breach of fiduciary duty cause of action. SNG argues that GGYC cannot demonstrate that a fiduciary relationship existed between the parties and that the duty was breached, two requirements to prevail on this theory of liability. SNG reasons that, as determined in Mercury Bay, the duty of the Defending Club in the America's Cup is to follow the Deed, which SNG did by accepting a valid challenge and negotiating a protocol with CNEV. GGYC offers no opposition to this defense, and it is deemed abandoned (see Rivera v Anilesh, 32 AD3d 202 [1st Dept 2006], affd 8 NY3d 627 [2007]).

Conclusion The court concludes that CNEV's challenge is invalid, and that GGYC is Challenger of Record pursuant to the Deed. GGYC's breach of fiduciary duty claim against SNG is dismissed.

Settle Order.

Dated: November 27, 2007 ENTER: J.S.C. Footnotes Footnote 1: At oral argument, Golden Gate Yacht Club argued that its preliminary injunction motion was moot, and counsel presented arguments only as to the motion for leave to file an amici curiae brief and the summary judgment motions.

Footnote 2: The others are Courageous Syndicate, Inc. v People-to-People Sports Committee, Inc., reported at 124 AD2d 776 (2d Dept 1986) and 112 AD2d 916 (2d Dept 1985).

Footnote 3: Article 22 of the Protocol provides for two dispute resolution bodies: a "Sailing Jury" that is to interpret provisions or resolve disputes of a sporting or technical nature arising under the competition regulations, and an "Arbitration Panel" which is to interpret all other provisions of the Protocol or resolve other disputes.

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BRIEF OF AMICUS CURIAE NEW YORK YACHT CLUB (NY 602446/07) NEW YORK COUNTY CLERK’S INDEX NO. 602446/07 Court of Appeals STATE OF NEW YORK __________________________________ GOLDEN GATE YACHT CLUB, Plaintiff-Appellant, -againstSOCIÉTÉ NAUTIQUE DE GENÈVE, Defendant-Respondent, -andCLUB NÁUTICO ESPAÑOL DE VELA Intervenor-Defendant-Respondent.

BRIEF OF AMICUS CURIAE NEW YORK YACHT CLUB CARTER LEDYARD & MILBURN LLP 2 Wall Street New York, New York 10005 212-732-3200 New York Yacht Club Attorneys for Amicus Curiae Of Counsel: JEFFREY BOXER VINCENT MONTE-SANO LAURA ANNE REEDS CORPORATE DISCLOSURE STATEMENT In compliance with Rule 500.1 of the Rules of Practice for the Court of Appeals of the State of New York, Amicus Curiae New York Yacht Club states that it has no parents, subsidiaries of affiliates.

PRELIMINARY STATEMENT New York Yacht Club (“NYYC” or the “Club”) respectfully submits this brief as amicus curiae to urge the Court to reverse the decision of the Appellate Division and hold that the challenge submitted by Club Náutico Española de Vela (“CNEV”) on July 3, 2007 was invalid under the Deed of Gift governing the America’s Cup and that CNEV is therefore ineligible to act as the Challenger of Record in the 33rd America’s Cup. The NYYC has not submitted a challenge for the upcoming 33rd America’s Cup. It has no personal interest or stake in the outcome of the litigation before the Court. Its interest in the subject of this litigation stems from its long, unique involvement with the America’s Cup and its desire to have the competition remain faithful to the Deed of Gift drafted by the settlors and to see that the races for the Challenger Selection Series and the America’s Cup are fair and even-handed competitions for all participants.

INTEREST OF THE AMICUS The histories of the NYYC and America’s Cup are inextricably intertwined. The Club was founded in 1844 by a group of yachtsmen including George Schuyler, and held its first annual regatta in 1846. On August 22, 1851, the schooner “America,” sailing under the NYYC burgee and owned by Mr. Schuyler and several other Club members, defeated a fleet of English yachts in a race around the Isle of Wight, winning the trophy that would later become known as the America’s Version 1.0

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Cup. The owners of the Cup donated it to the NYYC later that year, under the condition that it serve as a perpetual challenge trophy for international yacht racing between yacht clubs from different countries. In 1857, Mr. Schuyler along with four others—including two other founding members of the NYYC—executed and delivered to the NYYC the original Deed of Gift establishing the rules governing the America’s Cup. Mr. Schuyler revised the Deed of Gift in 1882 and contributed to its third revision in 1887. The Deed of Gift was revised by court order in 1956 and again in 1985.

Between 1857 and 1983, the NYYC successfully defended the Cup 24 times. During that 126-year period, the Club served as the trustee under the Deed of Gift. In all, the Club has raced for the America’s Cup 28 times, 25 as the Cup defender and trustee, and three times as a challenger (once as the “Challenger of Record”). The Club missed only the 1988, 1992, and 1995 races, when it was ineligible to participate because the Cup was held by another United States yacht club, and the 2007 races at Valencia, Spain. As a result of this long involvement, the NYYC has played a unique role in the evolution of the America’s Cup. For example, in 1970, on the basis of the “mutual consent” provision in the Deed of Gift, the NYYC initiated the development of the current structure pursuant to which a challenging yacht club (referred to as the “Challenger of Record”) negotiates with the defending yacht club a protocol for the conduct of the next match on behalf of all challengers. This permits mutual consent challengers from multiple yacht clubs to compete in elimination races leading up to a one-on-one match against the Defender. The America’s Cup previously had been a competition between a single challenging yacht club and a single defending yacht club.

The Club’s unique role did not end in 1983 when it lost the Cup and ceased to be the trustee under the Deed of Gift.

Rather, participants in the America’s Cup continued to rely on the Club’s experience and often turned to the NYYC for guidance in Cup matters. For example, the Protocols governing the 28th America’s Cup in 1992 and the 29th America’s Cup in 1995 provided that disputes arising between challengers or between the Defender and the Challenger of Record would be resolved in arbitration. The NYYC was selected to provide a neutral arbitrator to serve on that arbitration panel. Likewise, before submitting its challenge for the 32nd America’s Cup in 2007, Real Federación Española de Vela (“RFEV”), the Spanish national yachting federation, approached the NYYC to seek support for its entry as a mutual consent challenger. Unlike the case now before the Court, RFEV was not seeking to become the Challenger of Record, and its mutual consent challenge ultimately was accepted by Société Nautique de Genève (“SNG”), which had won the 31st America’s Cup and, under the terms of the Deed of Gift, was then the trustee of the Cup. 1 Furthermore, slightly over a year ago, the NYYC began discussions with Alinghi and BMW/Oracle, the sailing teams representing SNG and Golden Gate Yacht Club, respectively. The objective of these discussions was to restructure the competition for the America’s Cup in a manner that would preserve the balance between the Defender and the Challenger, as envisioned by Mr. Schuyler, while recognizing the commercial realities imposed by the need for corporate sponsorship to fund the sailing teams. While undertaking this effort, the Club adopted a posture of neutrality with respect to the dispute currently before the Court, and refrained from any public expression of its views. It was the Club’s hope that if agreement could be reached on the overall restructuring of the America’s Cup, the underlying dispute could be settled relatively easily. Unfortunately, that goal has proven unachievable, and the NYYC recognizes that the fate of the current America’s Cup now rests in the hands of the Court. In this regard, the Club believes that its position has been misrepresented in the papers submitted to this Court. (See Defendant’s Appellate Brief, 35 (falsely implying that the NYYC supports SNG’s position that a Challenger of Record need not hold an annual regatta before issuing its

It should be noted that the stance taken by NYYC in that dispute—that a Challenger under the Deed of Gift must be an actual yacht club—may have influenced RFEV to conclude that it would not be accepted as the Challenger of Record in its federated form. In order to avoid this issue, RFEV caused Respondent CNEV to be incorporated as a “yacht club.”

1

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challenge)). As a result, the NYYC has resolved to express its opinion on the issues raised herein, in the hope that the Club’s experience with such matters will be of assistance to the Court.

ARGUMENT CNEV DID NOT MEET THE QUALIFICATIONS IN THE DEED OF GIFT AT THE TIME OF ITS CHALLENGE AND IS THEREFORE INELIGIBLE TO ACT AS CHALLENGER OF RECORD The Deed of Gift pursuant to which the America’s Cup race was established requires that the yacht club defending the Cup accept the first challenge made by an “organized Yacht Club of a foreign country, incorporated, patented, or licensed by the legislature, admiralty, or other executive department, having for its annual regatta an ocean water course on the sea, or on an arm of the sea, or one which combines both.” When CNEV issued its challenge on July 3, 2007, it had never held an annual regatta and was not an “organized Yacht Club” because it had only five members (each of whom was also a member of RFEV's executive board), no yachts, was formed by RFEV just days before submitting its challenge for the America’s Cup, and was formed solely for the purpose of submitting that challenge.

The Appellate Division considered the phrase “having for its annual regatta” to be ambiguous and held that the settler intended it to include yacht 6 clubs that promised to hold an annual regatta but had not yet done so. (Appellate Division Decision, 8–11). The Appellate Division also held that a yacht club was “organized” so long as it had been “incorporated, patented, or licensed by the legislature, admiralty or other executive department” and found that CNEV was a valid Challenger. (Appellate Division Decision, 11–12). The Appellate Division’s holding was in error and should be reversed.

A. The Phrase “Having for Its Annual Regatta” Is Not Ambiguous As the New York Supreme Court and the dissenting justice in the Appellate Division panel stated, the phrase “having for its annual regatta” is not ambiguous. The plain and natural meaning of the phrase is that the challenging yacht club “has held one or more annual regattas in the past and will continue to do so in the future.” (Appellate Division Decision, 25 (Nardelli J., dissenting)).

Moreover, its meaning is made clear by another provision of the Deed of Gift which mandates that, “when a challenge from a Club fulfilling all the conditions required by this instrument has been received, no other challenge can be considered until the pending event has been decided.” If the requirement of a club “having for its annual regatta” were to be interpreted to include clubs that express the intention to hold an annual regatta but have not done so at the time of challenge, the yacht club defending the Cup would be unable to determine whether the club issuing the challenge was a valid Challenger until and unless that club actually held a regatta.

The Appellate Division seemed to believe that, under its interpretation of the phrase “having for its annual regatta,” a club that had not yet held a regatta at the time of its challenge would have to hold one before the Cup match took place.

(Appellate Division Decision, 8 (“As SNG would have it, the annual regatta requirement can be satisfied where the yacht club ‘intends to hold an annual regatta and does so prior to the date of its proposed match.’”)). On the contrary, the logical extension of the Appellate Division’s holding is that a newly formed yacht club could issue a challenge on day one of its incorporation, set the Cup match ten months later as permitted by the Deed of Gift, and vow to hold its first “annual” regatta a month or two after the Cup match (which would still fall within the first year of its existence). If the term “having” can be considered prospective, there is no language in the Deed of Gift that would prevent such an absurd outcome. Thus the Appellate Division’s interpretation cannot be reconciled with other provisions of the Deed of Gift and would eliminate the “annual regatta” qualification as a meaningful requirement altogether.

In its appellate brief, CNEV argues that if the phrase “having for its annual regatta” is read in the future tense, then it can be reconciled with the instruction that “when a challenge from a Club fulfilling all the conditions required by this

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instrument has been received, no other challenge can be considered until the pending event has been decided.”

(Intervenor-Defendant’s Appellate Brief, 13–14 (“The settlor chose to use the present tense participle ‘fulfilling’ and not ‘having fulfilled.’ The use of the term ‘fulfilling’ leaves open when the conditions may be fulfilled instead of requiring that they have been fulfilled by the time of the challenge.”)). In other words, CNEV maintains that a defender must accept a challenge from any yacht club which is in the process of fulfilling the conditions of the Deed of Gift, with no direction as to how far along in the “process” the Challenger must be as to any of those qualifications. This interpretation is simply incorrect. The plain and natural reading of both phrases, on their face and when evaluated in terms of their operation, is that in order to qualify as a Challenger under the Deed of Gift, a yacht club must meet the qualifications set forth therein before issuing its challenge.

B. The Extrinsic Evidence Does Not Support the Appellate Division’s Interpretation of the Phrase “Having for Its Annual Regatta” Even if the phrase “having for its annual regatta” were ambiguous— which it is not—the relevant extrinsic evidence does not support the interpretation given to that phrase by the Appellate Division. The only extrinsic evidence cited by the Appellate Division was the arbitral decision rendered by the America’s Cup Arbitration Panel (“ACAP”) with respect to SNG’s participation in the Challenger Selection Series for the 31st America’s Cup. (Appellate Division Decision, 10–11).

The ACAP decision addressed the issue of whether SNG could participate as a mutual consent challenger under the Protocol agreed to by the Defender and the Challenger of Record, not whether SNG would qualify as a valid Challenger of Record under the Deed of Gift. The Appellate Division brushed aside this crucial distinction, attempting to justify its conclusion by asserting that since SNG was allowed to enter the race as a mutual consent challenger without having held an annual regatta, it would be “incongruous” to prevent CNEV from being recognized as a valid Challenger of Record on those grounds. (Appellate Division Decision, 11). In so ruling, the Appellate Division glossed over the important distinction between a Challenger of Record and a mutual consent challenger and ignored relevant extrinsic information pointing to the opposite conclusion. Perhaps more significantly, by relying on the ACAP decision, the Appellate Division cited as extrinsic evidence of the intent of the drafters of the Deed of Gift an event that occurred more than 100 years after the document was drafted.

The America’s Cup was originally conceived under the Deed of Gift as a match between two yacht clubs—a Challenger and a Defender—with the match conditions to be established by “mutual consent” of the two clubs. This tradition persisted until 1970, when, pursuant to the mutual consent provision, the yacht club acting as the challenger and the NYYC (which was defending the Cup) negotiated a Protocol that permitted additional yacht clubs to submit mutual consent challenges and then to compete in a series of challenger elimination races with the winner of that series racing in a one-on-one match against the Defender. With one exception, subsequent America’s Cup races have involved a multiple-challenging club elimination format agreed to by the Defender and the challenging yacht club denominated as the “Challenger of Record.” It is this type of protocol that was interpreted to permit SNG to register as one of a number of mutual consent challengers participating in the Challenger Selection Series. Since the purpose of creating elimination races in the first place was to increase interest and participation in the sport of yacht racing, it is consistent that the protocol would be interpreted to encourage mutual consent challengers to participate. 2 A very different analysis is appropriate when interpreting the qualifications specifically set forth in the Deed of Gift with respect to the yacht club which is to serve as the Challenger of Record. A Challenger of Record must negotiate with the Similarly, it is for this reason that the NYYC supported the inclusion of Secret Cove Yacht Club of Canada as a mutual consent challenger in the 25th America’s Cup, even though Secret Cove had yet to hold their first annual regatta. That support does not, as SNG falsely implies in its brief (Defendant’s Appellate Brief, 35), extend to SNG’s argument that such a club would be a valid Challenger under the Deed of Gift.

2

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yacht club defending the Cup all of the rules to be set forth in the mutual consent protocol, including the specifications of the boats to be used, the location and schedule of the races, the conditions under which additional mutual consent challengers may participate, and the mechanisms for the resolution of disputes. In negotiating the protocol, the yacht club serving as the Challenger of Record must adequately represent the interests of the mutual consent challengers, and it must play a leading role in organizing the event itself, including both the Challenger Selection Series and the Cup races.

Unlike mutual consent challengers, the Challenger of Record cannot simply show up and race.

It is perplexing that in interpreting the Deed of Gift the Appellate Division failed to focus on the distinction between a Challenger of Record and a mutual consent challenger, and instead relied exclusively on an arbitral decision that was rendered close to a century after the provision at issue was written, that was binding only on the parties before it, and that did not address the issue before the court—especially when more relevant extrinsic evidence was available. In his dissent, Justice Nardelli recognized that the intent of the donor—the most relevant type of extrinsic evidence when interpreting the words of a trust—was clearly to allow only established, experienced yacht clubs to qualify as Challengers. (Appellate Division Decision, 25–26 (Nardelli J., dissenting)). The America’s Cup races of 1876 and 1881 were widely regarded as failures due to the inexperience of the Challenger in those years. The 1882 amendment that introduced the current “annual regatta” requirement into the Deed of Gift was made for the specific purpose of ensuring that unseasoned yacht clubs would not continue to tarnish the reputation of the America’s Cup as a truly competitive event. Although newly formed yacht clubs have occasionally been permitted to register as mutual consent challengers before holding their first annual regatta, 3 every pre-1970 Challenger and post-1970 Challenger of Record in the history of the America’s Cup has held an annual regatta prior to issuing the challenge to which the Deed of Gift refers.

At the time he amended the Deed of Gift in 1882, Mr. Schuyler was well aware that the NYYC and other legitimate “Yacht Clubs” held annual regattas. The NYYC had held more than a dozen annual regattas by this time, and the Royal Yacht Squadron, from which the Cup had originally been won, had held more than two dozen. Moreover, for a race to constitute an “annual” regatta, it must be repeated once each year. A club’s first regatta, therefore, is not an “annual” regatta because it does not follow a regatta from the prior year. For example, the NYYC held its first regatta in 1845, but it was the regatta of the following year—1846—that the NYYC designated as its “First Annual Regatta.” Mr. Schuyler’s intent in amending the Deed of Gift is clear from his experience at the time: legitimate yacht clubs hold annual regattas on the sea or an arm of the sea, and a yacht club that has not held such a regatta—much less one that has never held a regatta of any kind—is simply not qualified to be a Challenger for the Cup. C.

The Appellate Division Failed to Give Effect to the Phrase “Organized Yacht Club”

The Deed of Gift requires a Challenger to be an “organized Yacht Club of a foreign country, incorporated, patented, or licensed by the legislature, admiralty, or other executive department.” GGYC argued below that CNEV is not an “organized Yacht Club” within the ordinary meaning of the term, but the New York Supreme Court did not reach the issue since it found that CNEV could not be the Challenger of Record since it had not held an annual regatta.

Rather than remand to the Supreme Court, the Appellate Division, citing a 1926 case of that court, decided that the term “organized” meant simply that an entity “has taken all steps necessary to endow itself with the capacity to transact the

Indeed, as the Appellate Division acknowledged, entities that are not even yacht clubs have been permitted to register as mutual consent challengers. (Appellate Division Decision, 5 (noting that CNEV’s parent, RFEV, was permitted to participate in the 32nd Cup despite being “not a yacht club but a federation of sports clubs and individuals who promote the sport of sailing”)). Yet the Appellate Division did not find it “incongruous” that such an entity would be allowed to participate as a mutual consent challenger, despite its obvious ineligibility as a Challenger of Record under the Deed of Gift.

3

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legitimate business for which it was created.” (Appellate Division Decision, 11 (internal quotation marks and brackets omitted)). Based on this single reference, and without analyzing the relationship of that term to the rest of the words in the sentence in the Deed of Gift, the Appellate Division held that since CNEV had a valid certificate of incorporation, it qualified as an “organized Yacht Club” within the meaning of the Deed of Gift. The interpretation adopted by the Appellate Division renders the term “organized” completely superfluous.

Under the Deed of Gift, a Challenger must be both “an organized Yacht Club” and “incorporated, patented, or licensed by the legislature, admiralty or other executive department.” The term “organized” is linguistically separate from the terms “incorporated, patented, or licensed” and indicates an additional qualification. Indeed, the original 1857 Deed of Gift required only that the Challenger be an “organized Yacht Club.” The phrase “incorporated, patented, or licensed by the legislature, admiralty or other executive department” was added in the 1882 amendment to the Deed of Gift and imposed an additional requirement—that an “organized Yacht Club” must also be “incorporated, patented or licensed” in order to qualify as a Challenger for the Cup. Moreover, the term “organized” plainly suggests more than a paper existence. In fact, the New York Supreme Court recognized that “the donors contemplated additional indicia of a yachting club” when they used the term “organized” in the Deed of Gift. An interpretation which better comports with the intent of the settlors and with the history of the America’s Cup is that “organized” in this context means “securely established.” (Accord Brief of Amici Curiae Reale Yacht Club Canottieri Savoia and Mascalzone Latino, 21 (giving the example of “organized or established religion”) (emphasis in original)). When Mr. Schuyler and the other settlors chose the NYYC as the first Defender of the Cup and used the term “organized” to describe the type of Yacht Club that could be a proper Challenger, the NYYC had been active for 13 years, had held a dozen annual regattas, had hundreds of members and had a fleet of 25 yachts. The Royal Yacht Squadron had been active for 38 years, had held 27 annual regattas and had more than a dozen yachts. These were the “organized Yacht Clubs” that the settlers had in mind when they deeded the America’s Cup. In the history of the Cup, not one of the previous Challengers of Record has been, like CNEV, a mere shell of a “Yacht Club”—that is, a yacht club without a true membership, elected directors, an annual regatta or even a single yacht—when it issued its challenge.

D. The Terms of the Protocol Developed for the 33rd America’s Cup Demonstrate the Wisdom of Requiring a Challenger to be an Organized and Experienced Yacht Club The initial protocol developed for the 33rd America’s Cup (the “Protocol”) demonstrates the wisdom of the Deed of Gift’s requirement that the Challenger of Record be an organized yacht club which has held its own annual regatta.

Whether that Protocol reflects a prior arrangement between SNG and CNEV, or whether CNEV simply lacked the knowledge, experience and wherewithal to negotiate fair and even-handed terms, the result is the same: the Protocol gives an unfair advantage to SNG over any challengers. Specifically, the Protocol gives SNG the power to reject challenging yacht clubs at its sole discretion and disqualify those who dispute the Protocol or SNG’s authority thereunder; it permits SNG to arbitrarily appoint and supervise the Event Authority (which will conduct the Challenger Selection Series as well as the Cup Races) and all of the Regatta Officials; and it virtually eliminates the obligation held by the Challenger of Record to represent the interests of all challengers. Perhaps most alarmingly, the Protocol allows SNG to unilaterally determine the essential rules of the event, announce them to the other participants only 60 days beforehand, and change them at any time without consultation with the other participants.

In attempting to justify the radically new protocol that it has imposed on all challengers, SNG twists the words of Mr. Schuyler to manufacture support for its untenable position. SNG quotes, from his obituary in the New York Times, Mr. Schuyler’s statement that “if he ever became convinced there was any unfair or unsportsmanlike conditions in the deed he would be willing to have them changed,” and repeats the sentiment that “no matter what complications may occur in future in relation to the deed the New York Yacht Club will remember the words of Mr. Schuyler in support of the The Deeds

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document he executed.” (Defendant’s Appellate Brief, 30–31). SNG then implies that Mr. Schuyler would have wanted the Court to apply a “liberal interpretation of the Deed of Gift as an inclusive rather than exclusive document.”

The Club does indeed remember Mr. Schuyler’s support for the original Deed of Gift, and for the amendments that he later determined were necessary to ensure that the America’s Cup would remain a “spirited contest for the Championship.” The requirements that a Challenger be an organized yacht club having an annual regatta on the sea or an arm of the sea were chief among the criteria that Mr. Schuyler established in pursuit of that goal. Yet these are the very measures that SNG seeks to undermine. The terms of the protocol are the antithesis of everything that Mr. Schuyler envisioned and against which he intended to guard by requiring that any yacht club challenging for the America’s Cup be an “organized Yacht Club” having an “annual regatta.”

CONCLUSION For the reasons set forth herein, the NYYC respectfully urges the Court to reverse the decision of the Appellate Division and hold that the challenge proffered by CNEV on July 3, 2007 was invalid under the Deed of Gift and that CNEV is therefore ineligible to act as the Challenger of Record in the 33rd America’s Cup. Dated: New York, New York December 31, 2008 CARTER LEDYARD & MILBURN LLP By:_____________________________ Jeffrey S. Boxer Vincent Monte-Sano Laura Anne Reeds Two Wall Street New York, New York 10005 212-732-3200 Attorneys for Amicus Curiae New York Yacht Club

CASE 10: Golden Gate Yacht Club v. Société Nautique Geneve 2009 N.Y. Slip Op. 31722 (N.Y. Sup. Ct. 2009)

The following case is an Appeal

Golden Gate Yacht Club, Respondent, v Société Nautique de Genève, Appellant, and Club Náutico Español de Vela, Intervenor-Defendant.

First Department, July 29, 2008

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Golden Gate Yacht Club v Société Nautique de Genève, 2008 NY Slip Op 30782(U), reversed.

Golden Gate Yacht Club v Société Nautique de Genève, 2008 NY Slip Op 32296(U), reversed.

APPEARANCES OF COUNSEL Simpson Thacher & Bartlett LLP, New York City (Barry R. Ostrager, Jonathan K. Youngwood, George S. Wang and Laura D. Murphy of counsel), for appellant.

Latham & Watkins LLP, New York City (James V. Kearney and Gina M. Petrocelli of counsel), for respondent. {**55 AD3d at 27} OPINION OF THE COURT DeGRASSE, J.: Defendant Société Nautique de Genève (SNG) appeals from an order that, insofar as is relevant to this appeal, declared plaintiff Golden Gate Yacht Club (GGYC) the Challenger of Record for the upcoming America's Cup race and invalidated the challenge by which such status was claimed by intervenor-defendant Club Náutico Español de Vela (CNEV).

The America's Cup is a silver cup trophy that constitutes the corpus of a charitable trust created in the 19th century under New York law (see Mercury Bay Boating Club v San Diego Yacht Club, 76 NY2d 256, 260 [1990]). The Cup was first won in 1851 by the yacht America in a race around the Isle of Wight. George L. Schuyler, the sole survivor of the Cup's six owners, donated the trophy to the New York Yacht Club by Deed of Gift dated October 24, 1887 on condition that it be preserved "as a perpetual Challenge Cup for friendly competition between foreign countries." The America's Cup competition has become one of the world's premier international sporting events. Under the Deed, the holder of the Cup becomes its sole trustee, to be succeeded only by a successful challenger in a race at sea. The Cup has been defended 32 times since the inception of the competition. SNG, the current trustee or Defender, won the Cup on March 2, 2003 in the 31st America's Cup match and defended its title on July 3, 2007 in the 32nd America's Cup match. Pursuant to the Deed of Gift: "Any organized Yacht Club of a foreign country, incorporated, patented, or licensed by the legislature, admiralty, or other executive department, having for its annual regatta an ocean water course on the sea, or on an arm of the sea, or one which {**55 AD3d at 28} combines both, shall always be entitled to the right of sailing a match for this Cup, with a yacht or vessel propelled by sails only and constructed in the country to which the Challenging Club belongs, against any one yacht or vessel constructed in the country of the Club holding the Cup." The Challenger of Record is the first club to issue a challenge with respect to a given America's Cup. Under the Deed, the Challenger of Record must meet the annual regatta requirement, which will be discussed hereinafter, and must be (1) organized as a yacht club, (2) foreign, and (3) incorporated or licensed by its government. The Deed requires the Challenger of Record to give 10 months' written notice of the days for the proposed races, with the proviso that no race shall be held between November 1 and May 1 in the Northern Hemisphere or between May 1 and November 1 in the Southern Hemisphere. The 10 months' notice must detail the name, ownership, rig, and specified dimensions of the challenging vessel. The Deed precludes the Defender from entertaining any other purported challenge of record while the challenge of a qualified Challenger of Record is pending. Once a challenge is accepted, the Defender and the Challenger of Record may, under the Deed, set the conditions of the competition as follows: "The Club challenging for the Cup and the Club holding the same may, by mutual consent, make any arrangement satisfactory to both as to the dates, courses, number of trials, rules and sailing regulations, and any and all other conditions of the match, in which case also the ten months' notice may be waived."

Through this "mutual consent" provision, every America's Cup match since 1970, save one, has been an event in which challengers from different countries competed in an elimination series for the opportunity to have a one-on-one race with the Defender (see Mercury Bay Boating Club at 262). The Deed provides for a three-race match between the Defender and the Challenger of Record in the event of the parties' inability to agree upon the terms of a match. In such a case, the Defender chooses the courses of the races as well as the applicable race rules and sailing regulations. The winner of two of the three races is entitled to the Cup. In the last 38 years, only the 27th America's Cup match, held in 1988, was conducted as a two-boat race because the parties could not agree on terms. The 27th Cup match was also the subject of the Court of Appeals' {**55 AD3d at 29} decision in Mercury Bay Boating Club v San Diego Yacht Club (76 NY2d 256 [1990], supra).

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On July 3, 2007, immediately after its victory in the 32nd Cup match, SNG accepted CNEV's formal challenge for the 33rd Cup match.

By way of background, CNEV was incorporated as a sporting association under the laws of the Valencia region of Spain on June 19, 2007, by Real Federacion Española de Vela (RFEV).[FN1] Established under Spanish law in 1990, RFEV is not a yacht club but a federation of sports clubs and individuals who promote the sport of sailing. Nevertheless, it competed in the challenger elimination series for the 32nd America's Cup. CNEV was incorporated for the express purpose of challenging for the 33rd Cup and avoiding lingering controversy regarding the capacity of a sailing federation, such as RFEV, to become a challenger and potential trustee under the Deed of Gift. Upon acceptance of CNEV's challenge, and in keeping with the Deed's "mutual consent" provision, SNG and CNEV entered into a protocol setting out the terms of the 33rd America's Cup match. When it filed its challenge, CNEV had not held an annual regatta. By letter to SNG dated July 11, 2007, GGYC, the Challenger of Record for the 32nd America's Cup, disputed CNEV's challenge as follows: "We respectfully submit that the challenge is invalid. Among other deficiencies, it is not from a bona fide yacht club, but from an entity organized in the form of a yacht club only a few days before the challenge was accepted by SNG and which has never had an annual regatta on an open water course on the sea or an arm of the sea as required by the Deed of Gift. It is also apparent that this 'Challenger of Record' has not performed any of the duties of the Challenger as contemplated by the Deed of Gift, but has simply delegated to the Defender the authority to determine all of the 'conditions' governing the match. This undermines the fundamental purpose of the Deed of Gift to preserve this competition as a Challenge Cup."[FN2] GGYC proffered its own purported challenge with the letter and {**55 AD3d at 30} demanded recognition by SNG as the Challenger of Record for the 33rd America's Cup match. By its Notice of Challenge, GGYC proposed July 4, 2008 as the date of the first race and July 6 and 8, 2008 as the dates for the second and, if necessary, third races.

On July 20, 2007, invoking the arbitration provision of the protocol it entered into with CNEV, SNG applied to the 33rd America's Cup Arbitration Panel for a determination regarding CNEV's challenge. SNG's arbitration petition reads as follows: "There has been issued raised [sic] by prospective competitors in the 33rd America's Cup, including the Golden Gate Yacht Club, as to the validity of the challenge of Club Nautico Espanol de Vela. SNG as Trustee of the America's Cup makes an application to the Panel for a declaration that the challenge received from Club Nautico Espanol de Vela on 3rd July 2007 and accepted by SNG on the same date, is a valid challenge under the terms of the Deed of Gift of 24th October 1887, and that SNG is obliged to meet that challenge under the terms of the Deed of Gift."

July 20, 2007 is also the date on which GGYC commenced this action alleging that SNG breached the Deed of Gift and its fiduciary duty as trustee by accepting CNEV's challenge. GGYC contended that CNEV's challenge is invalid under the Deed because it was made when CNEV (1) was not an organized yacht club and (2) had not conducted an annual regatta. SNG moved and GGYC crossmoved for summary judgment with respect to the entire complaint. The motion court denied SNG's motion and granted GGYC's cross motion, vacating CNEV's challenge on the ground that CNEV had failed to meet the Deed's annual regatta requirement. Having made that determination, the motion court found it unnecessary to reach the question whether CNEV was an organized yacht club.

SNG subsequently moved for leave to renew and reargue, asserting that GGYC's challenge is deficient, based upon its description of its vessel. The court denied that motion (2008 NY Slip Op 30782[U]). An order incorporating the motion court's determination was entered on May 13, 2008 (2008 NY Slip Op 32296[U]). Noting that SNG's 10-month preparation period had been interrupted by this litigation, the court directed that the first challenge match race be held 10 months from the date of service of a copy of its order with notice of entry and that the second be held two business days thereafter and the third, if necessary, two business days after {**55 AD3d at 31} that. The court further directed that the 33rd America's Cup match be held in Valencia, Spain, the venue designated upon SNG's acceptance of CNEV's challenge, or at a different location upon notice prescribed by the order.

This appeal turns on the meaning of the words "having for its annual regatta" as used in the Deed of Gift. In making its determination, the motion court found that the phrase is "plainly understood to mean that it is an on-going activity; the activity has taken place and is continuing" (18 Misc 3d 1111[A], 2007 NY Slip Op 52496[U]. The court further found that the phrase "implies that the organization has had one or more regattas in the past, and will continue to have them in the future" (id.). Accordingly, the court reasoned that CNEV was not a qualified Challenger of Record because it had not held an annual regatta as of the date of its challenge. The Deed of Gift, a trust instrument, "is to be construed as written and the settlor's intention determined solely from the unambiguous language of the instrument itself" (Mercury Bay Boating Club, 76 NY2d at 267). As SNG would have it, the annual regatta requirement can be satisfied where the yacht club "intends to hold an annual regatta and does so prior to the date of its proposed match." GGYC disputes SNG's construction, arguing that " '[h]aving' as commonly used in the law does not mean 'not having now.' It means 'possess.' And, in this context, it means, 'possess' an annual regatta." GGYC's argument is untenable because, as a matter of standard English usage, the noun "regatta" cannot be the proper object of the verb "possess."

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The record includes an excerpt from An English Grammar For the Use of High School, Academy, and College Classes, by W. M. Baskervill and J. W. Sewell (1896). According to this treatise, participles, such as "having," are verbals that "express action in a general way, without limiting the action to any time, or asserting it of any subject." Participles "cannot be divided into tenses (present, past, etc.), because they have no tense of their own, but derive their tense from the verb on which they depend." An example given in the treatise is "fulfilling," which depends on the past-tense verb, "walked," in the following: "He walked conscientiously through the services of the day, fulfilling every section the minutest, etc." A further example is "dancing," which depends on a present-tense verb in the following verse: "Now the bright morning star, day's harbinger, {**55 AD3d at 32} Comes dancing from the East."

In accordance with the foregoing, "having for its annual regatta" can only be interpreted through strained English usage. If explicable at all, the phrase is subject to conflicting interpretations. We therefore hold that the Deed of Gift's annual regatta requirement is ambiguous. GGYC argued below that the participle "having," in the Deed, derives its tense from the words "shall always be entitled." "Shall," however, is a word used to form the future tense (Lutz and Stevenson, The Writer's Digest Grammar Desk Reference § 1C, at 16-17). Accordingly, GGYC's argument only confirms the ambiguity of the annual regatta requirement.

A court may resort to extrinsic evidence to construe an ambiguous provision of a trust instrument (see Mercury Bay Boating Club, 76 NY2d at 267). In this instance, the Cup's recent history is a source of relevant extrinsic evidence. SNG challenged for the 31st America's Cup by letter to the Royal New Zealand Yacht Squadron (RNZYS), the then trustee, on August 18, 2000. SNG, a Swiss yacht club, is situated on Lake Geneva and, as of the date of its challenge, had never held a regatta on an ocean water course, as required by the Deed. As a precautionary measure, SNG and RNZYS applied to the 31st America's Cup Arbitration Panel (ACAP 31) for a ruling regarding the validity of SNG's challenge and "seeking interpretations of the Deed of Gift relating to the criteria for future challengers by yacht clubs not located on the sea or an arm of the sea." ACAP 31 received submissions from three other yacht clubs, including the New York Yacht Club, none of which disputed the validity of SNG's challenge. ACAP 31 resolved the issue by determining that the Deed of Gift has no provision requiring the annual regatta to have been held prior to the lodging of a challenge.

GGYC attempts to dismiss ACAP 31's decision as "unremarkable" because SNG was not the Challenger of Record for the 31st Cup but merely a so-called "Mutual Consent Challenger." However, the Deed itself makes no such distinction with respect to the annual regatta requirement. Adoption of the distinction would mean that a yacht club, such as SNG in 2000, could win the Cup, serve as its trustee, and defend it, but lack the capacity to be a Challenger of Record. Nothing in the Deed of Gift calls for such an incongruous result.

As noted above, the motion court did not address GGYC's argument that CNEV is not an "organized Yacht Club," a status required but not defined by the Deed. An entity is "organized" {**55 AD3d at 33} if it has taken all steps "necessary to endow [itself] with the capacity to transact the legitimate business for which it was created" (Matter of Corporation of Yaddo, 216 App Div 1, 5 [1926]).

According to its certificate of incorporation, CNEV was incorporated as a sports entity whose purpose is to support "sports activities practiced on the sea, and especially to promote the sport of sailing by organizing national and international regattas held in national territory." It has an address, bylaws and a board of directors. In addition, as indicated it is registered with the Valencian Registry of Sports Organizations. Based upon the foregoing attributes, we hold that CNEV was organized as a yacht club at the time of its challenge. GGYC cites no authority to support its argument that a yacht club must have vessels to be organized. Therefore, CNEV met the Deed of Gift's organizational and annual regatta requirements. In light of the foregoing, we need not reach the issue whether GGYC's purported challenge was deficient.

Accordingly, the orders of the Supreme Court, New York County (Herman Cahn, J.), entered March 18, 2008 and May 13, 2008, which, inter alia, declared CNEV's challenge invalid and GGYC the Challenger of Record under the Deed of Gift, should be reversed, on the law, with costs, CNEV declared the Challenger of Record, and, in keeping with the Deed of Gift's requirement that the Defender be given at least 10 months' written notice to prepare for the challenge, the 10-month notice period should be tolled until service of a copy of this order.

Nardelli, J.: (dissenting).

Because I find, inter alia, that the motion court properly concluded that the relevant wording of the Deed of Gift is unambiguous and, therefore, that the challenge of Club Náutico Español de Vela is invalid, I respectfully dissent.

The America's Cup[FN1] is a silver trophy which is the corpus of a charitable trust, having derived its name from the schooner America, which won a yacht race around the Isle of Wight against numerous British challengers in 1851. The six owners of America and the Cup donated it to the New York Yacht Club in 1857, but it was twice returned to George Schuyler, the sole surviving Cup donor, when questions arose regarding the terms {**55 AD3d at 34} of the trust under which the Cup was to be held. In 1887, Schuyler

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again donated the Cup to the New York Yacht Club pursuant to the current Deed of Gift (Deed), dated October 24, 1887,[FN2] "upon the conditions that [the Cup] shall be preserved as a perpetual Challenge Cup for friendly competition between foreign countries."

The Deed provides that the holder of the Cup is its sole trustee until such time as a successful challenge is mounted by a qualified challenger.[FN3] The Deed specifically delineates what criteria must be met for a yacht club to be considered an eligible challenger, and therefore entitled to challenge for the Cup, and it is that provision, which follows, that is at the core of the current controversy: "Any organized Yacht Club of a foreign country, incorporated, patented, or licensed by the legislature, admiralty, or other executive department, having for its annual regatta an ocean water course on the sea, or on an arm of the sea, or one which combines both, shall always be entitled to the right of sailing a match for this Cup, with a yacht or vessel propelled by sails only and constructed in the country to which the Challenging Club belongs, against any one yacht or vessel constructed in the country of the Club holding the Cup" (emphasis added).

The first club that issues a challenge provides the defender with 10 months' written notice (Notice of Challenge), names the days for the proposed race in accordance with the Deed restrictions,[FN4] and provides certain technical information about the challenging vessel, becomes the Challenger of Record. As noted by the Court of Appeals in Mercury Bay (76 NY2d at 261), there is nothing in the Deed which limits the design of the defending club's vessel other than the length on water-line limits applicable to all competing vessels. Further, the vessels are not limited to monohulls, and there is no requirement that the vessel defending the Cup have the same number of hulls as the challenger, or even that the competing vessels be substantially similar. {**55 AD3d at 35} The Deed gives the defending club and the Challenger of Record the freedom to promulgate all of the particular details of the races, and states that the parties "may, by mutual consent, make any arrangement satisfactory to both as to the dates, courses, number of trials, rules and sailing regulations, and any and all other conditions of the match, in which case also the ten months' notice may be waived." Historically, the defender and the Challenger of Record have, pursuant to the foregoing provision, come to terms and issued an agreed-upon protocol which, inter alia, allows for other yacht clubs, as "Mutual Consent Challengers," to participate in an elimination regatta for the right to race the defender. In the event the parties cannot mutually agree upon the terms of a match,[FN5] "then three races shall be sailed, and the winner of two of such races shall be entitled to the Cup." The Deed provides the terms and conditions for such a one-on-one match.

Finally, the Deed provides that "when a challenge from a Club fulfilling all the conditions required by this instrument has been received, no other challenge can be considered until the pending event has been decided."

Defendant Société Nautique de Genève (SNG) is a Swiss yacht club and the Cup's current defending club and trustee, having, through its Team Alinghi, initially won the 31st America's Cup on March 2, 2003, and thereafter successfully defended its title in the 32nd America's Cup match on July 3, 2007. Plaintiff Golden Gate Yacht Club (GGYC) was the Challenger of Record for the 32nd America's Cup in which 12 yacht clubs raced, although it was eliminated in the challenger series and did not compete in the final match.

Initially, Real Federacion Española de Vela (RFEV), a Spanish sailing federation, contemplated becoming the Challenger of Record for the 33rd America's Cup, but was advised by its lawyers that because it was a federation of yacht clubs, and not a yacht club itself, its status of Challenger of Record could be disputed. Accordingly, in an attempt to sidestep controversy, RFEV incorporated defendant Club Náutico Español de Vela (CNEV) on June 19, 2007{**55 AD3d at 36}[FN6] as a private Spanish sports club, with unlimited duration, for the purpose of promoting sailing practices through the organization of national and international regattas and to organize at least one regatta per year in the open sea.

On July 3, 2007, CNEV tendered a formal Notice of Challenge for the 33rd America's Cup, asserting that it was a valid challenger under the terms of the Deed, in that it was a foreign yacht club organized under Spanish law and that it agreed to hold two annual regattas prior to the racing of the 33rd America's Cup match. SNG accepted CNEV as the Challenger of Record on the same day, and on July 5, 2007, the parties publicly released "The Protocol Governing the Thirty-Third America's Cup" (Protocol).

While a number of international yacht clubs signed on to the Protocol shortly after its publication,[FN7] an equal or greater number of clubs signed a letter which not only condemned the Protocol as "the worst text in the history of the America's Cup and more fundamentally [because] it lacks precisely the mutual consent items which are required," but also questioned the legitimacy of the "newly created and purely instrumental entity" CNEV "to advance a Challenge under the provisions of the Deed of Gift." The letter further propounds that the Protocol so heavily favors the Defender by shifting the balance of the competition in its favor that it "jeopardizes the . . . survival of the event."

GGYC, on July 11, 2007, issued its own formal Notice of Challenge, noting that it:

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"(a) is incorporated in the United States of America, in the State of California; "(b) maintains a membership of more than 200 members; "(c) operates as a yacht club and has objectives consistent with the furtherance of yachting activities; "(d) is a member of our national sailing authority, US SAILING; and{**55 AD3d at 37} "(e) has an annual regatta, the Sea Weed Soup Perpetual Trophy that, among other GGYC regattas, is and has been held annually on an arm of the sea, namely San Francisco Bay." Accordingly, GGYC contended that it is an organized yacht club that fulfills all of the conditions of a Challenger of Record under the terms of the Deed.

SNG, by letter dated July 23, 2007, formally rejected GGYC's challenge, stating that it had already received a valid challenge from CNEV and that the Deed barred consideration of GGYC's challenge until the pending challenge of CNEV has been decided. In the interim, on July 20, 2007, SNG commenced an arbitration proceeding pursuant to the arbitration provisions of the Protocol,[FN8] seeking a ruling as to the validity of CNEV's challenge. The arbitration panel invited GGYC's participation in the proceedings, but GGYC, by letter dated July 27, 2007, declined to do so, poignantly stating, inter alia, that: "It is subterfuge to have SNG and CNEV's hand picked arbitrators, replaceable at . . . their whim, sitting in a forum and under rules wholly controlled by SNG and CNEV, and judging an issue that the parties to the arbitration do not dispute. The disgrace and shame brought upon the America's Cup by this charade threatens to inflict a crippling blow to the sport. This arbitration, if it chooses to proceed, will not and cannot have any involvement from GGYC, and will be viewed with the same disdain by the public and sailing community as CNEV's sham regatta."

On September 10, 2007 the panel ruled that CNEV qualified as a valid Challenger of Record and that the Deed did not require that an annual regatta have been held prior to the issuance or acceptance of a newly formed yacht club's notice of challenge.

GGYC, on the same date that SNG had initiated the arbitration proceeding, commenced the within action against SNG by {**55 AD3d at 38} the service of a summons and verified complaint, which interposed two causes of action. The first cause of action sounds in breach of fiduciary duty and asserts that SNG, as trustee of the Cup, has a duty to enforce the terms of the Deed and that it breached that duty and engaged in self-dealing when it accepted CNEV's challenge, and when it entered into the Protocol without engaging in the process set forth in the Deed's "mutual consent" clause. The second cause of action, which alleges breach of the Deed, states that CNEV's Notice of Challenge and challenges were invalid in that they failed to conform to the terms of the Deed.

The complaint seeks[FN9] a declaration that the purported challenge and the Protocol are void; a declaration that GGYC's challenge is valid; judgment enjoining SNG from promulgating rules and regulations pursuant to the Protocol and directing SNG to reject CNEV's challenge; and judgment enjoining SNG to accept GGYC's Notice of Challenge and to implement the terms of the Deed by participating with GGYC in the establishment of a protocol through a consensual process or, failing that, to proceed with a match under the express rules of the Deed.

SNG subsequently moved for summary judgment dismissing the complaint on the ground that CNEV satisfied all of the requirements of the Deed. GGYC opposed the motion and cross-moved for summary judgment in its favor, arguing that CNEV is not an "organized" yacht club and has not held an annual regatta[FN10] as required by the terms of the Deed. GGYC contends that CNEV is controlled by RFEV, and that it is a shell entity that has refused to identify its members, has no vessels, no telephone number other than that of the base facility of its racing team, and no Web site.

The motion court, in a memorandum decision dated November 27, 2007, dismissed GGYC's cause of action for breach of fiduciary duty, but granted it summary judgment on its cause of action for breach of the terms of the Deed (18 Misc 3d 1111[A], 2007 NY Slip Op 52496[U]). The court found that the wording in the Deed, "having for its annual regatta," requires that the challenging yacht club must have had one or more regattas in {**55 AD3d at 39} the past, and will continue to have them in the future. Since CNEV had not yet held an annual regatta at the time it issued its challenge, the court ruled that CNEV was not a qualified challenger under the terms of the Deed. Having reached that conclusion, the court did not reach GGYC's alternative argument that CNEV is not an "organized" yacht club as prescribed by the Deed. Furthermore, the court ruled that GGYC's Notice of Challenge comported with the requirements of the Deed and, therefore, that GGYC was the Challenger of Record. The court rejected SNG's argument that GGYC should be denied such a declaration under the doctrine of unclean hands.

SNG subsequently moved for leave to renew and reargue the court's decision on the grounds that the court improperly adjudicated the validity of GGYC's challenge, as that issue was not properly before the court, and that in any event, GGYC's challenge and

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certificate did not meet the requirements of the Deed. The court thereafter issued an order to show cause why GGYC's challenge should not be declared invalid and noncompliant with the Deed. After conducting a hearing on the validity of GGYC's challenge, the court consolidated SNG's motion for renewal and reargument with its motion to declare GGYC's Notice of Challenge invalid and denied both motions (2008 NY Slip Op 30782[U]). On or about May 12, 2008, the court issued an order reflecting the foregoing decisions, as well as a separate order directing that the 10-month notice period provided for in the Deed, which is designed to allow the defender to prepare for the race, should commence at the time the order was served (2008 NY Slip Op 32296[U]).

SNG appeals and I vote to affirm.

Clearly, the lynchpin on which this appeal turns is the interpretation to be afforded the phrase "having for its annual regatta" as it is used in the Deed. Our analysis, then, begins with the well established proposition that the settlor's intent controls, and that "[l]ongsettled rules of construction preclude an attempt to divine a settlor's intention by looking first to extrinsic evidence. Rather, the trust instrument is to be construed as written and the settlor's intention determined solely from the unambiguous language of the instrument itself" (Mercury Bay, 76 NY2d at 267 [citations omitted]; see also Matter of Piel, 10 NY3d 163, 166 [2008] [it is a "fundamental premise that a court must first look within the four corners of a trust instrument to determine the grantor's intent"]; Central Union Trust Co. v Trimble, 255 NY 88, 93 [1930] ["We are to {**55 AD3d at 40} search, not for the probable intention of the settlor merely, but for the intention which the trust deed itself, either expressly or by implication, declares. We are to ascertain the intention from the words used and give effect to the legal consequences of that intention when ascertained"]).

As previously noted, the Deed sets forth an explicit framework within which a yacht club must fall to be considered an eligible challenger for the Cup. That provision expressly states: "Any organized Yacht Club of a foreign country, incorporated, patented, or licensed by the legislature, admiralty, or other executive department, having for its annual regatta an ocean water course on the sea, or on an arm of the sea, or one which combines both, shall always be entitled to the right of sailing a match for this Cup with a yacht or vessel propelled by sails only and constructed in the country to which the Challenging Club belongs, against any one yacht or vessel constructed in the country of the Club holding the Cup" (emphasis added).

Giving the phrase "having for its annual regatta an ocean water course" its "plain and natural meaning" (Mercury Bay, 76 NY2d at 267), I am in agreement with Justice Cahn that such phrase plainly means that the organization must be in possession[FN11] of an annual regatta or, stated another way, that it has held one or more annual regattas in the past and will continue to do so in the future. Indeed, in order to realize the interpretation propounded by SNG, the Deed would have had to state "having, or intending to have, for its annual regatta" but it does not, and to extrapolate that interpretation from the current language, in my view, strains its meaning beyond reason.

Moreover, taking into consideration the language of the foregoing provision in its entirety, it is clear that the donor's intent was to allow for challenges for the Cup from established yacht clubs that regularly hold annual regattas and not from a club merely organized just for the purpose of challenging for the Cup, without any experience in holding a regatta of this magnitude. While, as a sailing federation, RFEV may very well be capable of organizing and carrying out such an event as a Cup race, that is simply not what the Deed requires and, in my view, it is error to hold otherwise. {**55 AD3d at 41} To the extent that SNG argues custom and practice in that other challengers which had never held annual regattas were permitted to sail for the Cup in the past,[FN12] while this is so, those clubs were Mutual Consent Challengers that qualified under the Protocol promulgated by the defender and the Challenger of Record at that time and, thus, fall outside the requirements of the Deed, which only delineates the criteria for the Challenger of Record and leaves "any and all other conditions of the match" to the Challenger of Record and the current trustee. Indeed, the elimination series, which allows for challengers in addition to the Challenger of Record, appears to be a relatively recent development in the history of the Cup, having been instituted in the late 1950s by the New York Yacht Club (see Mercury Bay, 76 NY2d at 262).

I am also in agreement with the motion court that GGYC's Notice of Challenge is in compliance with, and therefore valid under, the provisions of the Deed. In Mercury Bay, the Court of Appeals noted that the Deed "broadly defines the vessels eligible to compete in the match" (76 NY2d at 266), and "permits the competitors to both construct and race the fastest vessels possible so long as they fall within the broad criteria of the deed . . . [which document makes it] clear that the design and construction of the yachts as well as the races, are part of the competition contemplated" (id. at 269).

Here, GGYC's notice and certificate contain all the information required by the Deed, although SNG takes issue with GGYC's description of the challenging vessel in the certificate as a "keel yacht" while specifying dimensions suggestive of a multi-hulled vessel, such as a catamaran, thereby creating an ambiguity and rendering the challenge invalid. It is clear, however, that even if the

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certificate contained a possible ambiguity, SNG was not at any time actually confused or misled by the certificate, as the record indicates that SNG fully understood that GGYC was going to race a catamaran. The general counsel of SNG's representative racing team, in an affidavit submitted in support of SNG's motion for summary judgment, averred that the dimensions delineated in the certificate "can only be for a multi-hulled vessel—presumably a catamaran," while not referring to any confusing or inconsistent language on that {**55 AD3d at 42} point. Moreover, SNG's protestations of confusion are belied by its own reply brief in which SNG acknowledges that GGYC has proposed to compete with a "catamaran goliath."

Accordingly, since SNG has failed to raise any material issues of fact, I find GGYC's Notice of Challenge valid.

Moskowitz and Acosta, JJ., concur with DeGrasse, J.; Saxe, J.P., and Nardelli, J., dissent in a separate opinion by Nardelli, J. Orders, Supreme Court, New York County, entered March 18, 2008 and May 13, 2008, reversed, on the law, with costs, Club Náutico Español de Vela declared the Challenger of Record, and the 10 months' notice period tolled until service of a copy of this order.

Footnotes Footnote 1: CNEV was duly registered with the regional Registry of Sports Organizations (Registro de Entidades Deportivas de la Comunitat Valenciana) on June 28, 2007.

Footnote 2: CNEV subsequently held its regatta on November 24 and 25, 2007 in Valencia, Spain.

Footnote 1: The following historical background of the America's Cup has been gleaned from the decision of the New York State Court of Appeals in Mercury Bay Boating Club v San Diego Yacht Club (76 NY2d 256 [1990]), as well as from those parts of the parties' submissions which are undisputed.

Footnote 2: The Deed was amended by two orders of the New York State Supreme Court, dated December 17, 1956 and April 5, 1985.

Footnote 3: The Deed also provides a mechanism for the transfer of the Cup "[s]hould the Club holding the Cup be for any cause dissolved."

Footnote 4: Pursuant to the terms of the Deed, races must be scheduled between May 1 and November 1 if they are to be held in the Northern Hemisphere, and between November 1 and May 1 in the Southern Hemisphere.

Footnote 5: Since 1970, a multi-challenger match race has been conducted every three to four years, with the defending club and the Challenger of Record agreeing on a protocol, except for the 27th America's Cup match, held in 1988, which resulted in a twoboat match and which eventually led to the Court of Appeals' decision in Mercury Bay. Footnote 6: CNEV was registered with the Registro de Entidades Deportivas de la Comunitat Valenciana (Registry of Sports Organizations of the Valencian Community) on June 28, 2007.

Footnote 7: SNG maintains that additional qualified yacht clubs have signed on to the Protocol since the summary judgment motions were filed in Supreme Court.

Footnote 8: Part D of the Protocol, entitled "DISPUTE RESOLUTION AND ENFORCEMENT," provides, in relevant part, that "[a]ny dispute, protest or claim arising out of or in relation to this Protocol and/or the Applicable Documents . . . shall be resolved by arbitration in accordance with the provisions of this Protocol." The Protocol at that time further allowed SNG and CNEV to privately select the arbitration panel members and to "dismiss and replace them . . . at their discretion at any time."

Footnote 9: CNEV subsequently sought, and was permitted, to intervene in this action. However, CNEV has made no submissions in connection with this appeal.

Footnote 10: Initially, SNG maintained that CNEV had held two regattas, one of which turned out to have been held for children, and the other of which SNG no longer argues qualifies under the Deed.

Footnote 11: See generally Webster's Third New International Dictionary 1040 (2002 ed).

Footnote 12: The Mercury Bay Boating Club, which was a Challenger of Record, was apparently incorporated only nine months prior to its challenge, but was an established yacht club for approximately 40 years which held approximately 25 races per year.

Case 11: MERCURY BAY v. SAN DIEGO 76 N.Y.2d 256 (N.Y. 1990) The following is a Court of Appeals case

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Mercury Bay Boating Club Inc., Appellant, v San Diego Yacht Club, Respondent, et al., Defendant New York Yacht Club, Intervenor.

In the Matter of San Diego Yacht Club, Respondent.

Attorney-General of the State of New York, Respondent.

Court of Appeals of New York Argued February 8, 1990 Decided April 26, 1990 76 NY2d 256 CITE TITLE AS: Mercury Bay Boating Club v San Diego Yacht Club OPINION OF THE COURT Alexander, J. On September 7 and 9, 1988, in the waters off San Diego, California, Mercury Bay Boating Club Inc.'s challenger vessel, the New Zealand, a monohull-keel yacht, was defeated two races to none by San Diego Yacht Club's defending twin-hulled catamaran, the Stars and Stripes, in the 27th America's Cup match. Contending that San Diego's defense of the Cup by sailing an inherently faster multihull catamaran against a larger, but slower monohull yacht was unsportsmanlike, antithetical to the concept of "friendly competition between foreign countries" and a "gross mismatch" in violation of the America's Cup Deed of Gift and San Diego's obligations as trustee, Mercury Bay obtained a judgment in New York Supreme Court disqualifying San Diego's catamaran, declaring the New Zealand to be the winner of the two races and directing that San Diego transfer the America's Cup to Mercury Bay. A divided Appellate Division reversed, declared the Stars and Stripes to be an eligible vessel and the winner of the two races, and therefore that San Diego was the rightful holder of the America's Cup. We agree that the Stars and Stripes was an eligible vessel under the terms of the Deed of Gift and that San Diego breached no fiduciary duty in racing a catamaran against Mercury Bay's challenging yacht. Accordingly, we affirm.

I The America's Cup, a silver cup trophy, is the corpus of a charitable trust created in the 19th century under the laws of New York. So called because it was won by the yacht America in a race around the Isle of Wight in 1851, the America's Cup was donated by its six owners to the New York Yacht Club in 1857. The Cup was twice returned to George Schuyler, the sole surviving donor, when questions arose as to the terms of the trust in which the Cup was to be held. Schuyler executed the present Deed of Gift in 1887, donating the Cup to the New York Yacht Club, to be held in trust "upon the condition that it shall be preserved as a perpetual Challenge Cup for the friendly competition between foreign countries".

Pursuant to the Deed of Gift, the holder of the Cup is its sole trustee and is to be succeeded by a competitor who successfully challenges the trustee in a race for the Cup. Unless otherwise agreed by the parties, the terms of the challenge are specified in the deed. The relevant provisions of the deed provide: "This Cup is donated upon the condition that it shall be preserved as a perpetual Challenge Cup for friendly competition between foreign countries.

"Any organized Yacht Club of a foreign country * * * shall always be entitled to the right of sailing a match for this Cup, with a yacht or vessel propelled by sails only and constructed in the country to which the Challenging Club belongs, against any one yacht or vessel constructed in the country of the Club holding the Cup.

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"The competing yachts or vessels, if of one mast, shall be not less that forty-four feet nor more than ninety feet on the load waterline; if of more than one mast they shall be not less than eighty feet nor more than one hundred and fifteen feet on the load waterline.

"The Challenging Club shall give ten months' notice, in writing, naming the days for the proposed races * * * Accompanying the ten months' notice of challenge there must be sent the name of the owner and a certificate of the name, rig, and following dimensions of the challenging vessel, namely, length on load water-line; beam at load water-line and extreme beam; and draught of water, which dimensions shall not be exceeded; and a custom-house registry of the vessel must also be sent as soon as possible. Centreboard or sliding keel vessels shall always be allowed to compete in any race for the Cup, and no restriction nor limitation whatever shall be placed upon the use of such centre-board or sliding keel, nor shall the centre-board or sliding keel be considered a part of the vessel for any purposes of measurement.

"The Club challenging for the Cup and the Club holding the same may, by mutual consent, make any arrangement satisfactory to both as to the dates, courses, number of trials, rules and sailing regulations, and any and all other conditions of the match, in which case the ten months' notice may be waived.

"In case the parties cannot mutually agree upon the terms of a match, then three races shall be sailed, and the winner of two of such races shall be entitled to the Cup. All such races shall be on ocean courses * * * [These ocean courses] shall be selected by the Club holding the Cup; and these races shall be sailed subject to its rules and sailing regulations so far as the same do not conflict with the provisions of this deed of gift, but without any time allowances whatever. The challenged Club shall not be required to name its representative vessel until at a time agreed upon for the start, but the vessel when named must compete in all the races, and each of such races must be completed within seven hours."

Although the defending club, as holder of the Cup, is its trustee, it is nevertheless required to compete with challengers for the Cup. Nothing in the deed limits the design of the defending club's vessel other than the length on water-line limits applicable to all competing vessels, nor are the competing vessels expressly limited to monohulls. Moreover, there is no requirement that the defending vessel have the same number of hulls as the challenging vessel, or even that the competing vessels be substantially similar.

Prior to 1988, the America's Cup competitions generally were conducted under the mutual consent provisions of the deed, with the contestants agreeing upon the date, time and length of the races and, beginning in 1930, even upon the choice of vessels to be raced. Although multihull vessels were in use at the time the deed was executed in 1887 and during all the ensuing years, none ever competed for the America's Cup prior to the match at issue here. Between 1930 and 1937, the agreed-upon vessels were large ocean-going vessels known as J- boats, which subsequently became too expensive to build and maintain. Consequently, the yachting community lost interest in the America's Cup competition and the New York Yacht Club, which had successfully defended the Cup 16 times before 1937, received no challenges for a 20-year period thereafter. Attempting to revive interest in the competition, in 1956 the New York Yacht Club obtained a court order amending the Deed of Gift to reduce the minimum load water-line length to its present 44 feet and to eliminate the requirement that the challenging vessel sail to the match "on its own bottom", a requirement that had disadvantaged foreign challengers. These amendments allowed the competition to be conducted in yachts of the international 12-meter class, which measure 44 feet on the load waterline. Thereafter, in response to the increased interest in the competition by many challengers and with the consent of those challengers, the New York Yacht Club instituted an elimination series, conducted in these 12-meter yachts, in which the winner of the series was entitled to sail a match against the defender of the Cup. The America's Cup races were conducted in these elimination series at 3-to-4- year intervals for a period of 30 years, with the New York Yacht Club retaining the Cup until 1983 when it lost to the Royal Perth Yacht Club of Australia. Three years later, 13 yacht clubs representing six nations competed to determine which would challenge Royal Perth for the Cup. In the finals, Stars & Stripes '87 of the San Diego Yacht Club defeated Royal Perth's defender Kookaburra III four races to none.

San Diego planned to defend the Cup in 1990 or 1991 in a 12-meter yacht, adhering to the traditional multiple challenger format. In 1987, as yacht clubs all over the world prepared to compete in that event, Mercury Bay issued a notice of challenge to San Diego, which for the first time in 30 years, deviated from the multiple challenger format as well as the tradition of holding the races in 3-to4-year intervals. Mercury Bay demanded a match in less than a year and disclosed that it would race a yacht measuring 90 feet on the load waterline, the maximum length permitted in the deed and a size yacht that had not been built in 50 years. As most foreign yacht clubs were already preparing for a race of 12-meter yachts, they would have been unable to compete on the terms demanded

by Mercury Bay; indeed, of the 19 bids received by San Diego, Mercury Bay's was the only challenge which deviated from the

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traditional format. To justify its unorthodox challenge, Mercury Bay advised San Diego that it sought to compete in a vessel larger than those of recent matches because such a yacht, by "utilizing technology outside any class or rating rule would be most likely to offer real opportunity of innovative design to the benefit of yachting at large".

San Diego announced that the terms of the challenge were unacceptable under the Deed of Gift and notified other challengers that the next match would be held in 1990 or 1991 in 12-meter yachts. Mercury Bay commenced an action in New York Supreme Court seeking a declaration of the validity of its challenge, and a preliminary injunction prohibiting San Diego from considering any other challenges until Mercury Bay's challenge was decided.

In its capacity as trustee of the America's Cup, San Diego commenced an action pursuant to EPTL 8-1.1 (c) (1), seeking interpretation or amendment of the Deed of Gift to authorize a continuation of the traditional 12-meter yacht elimination series format employed by both the New York Yacht Club and the Royal Perth Yacht Club, the only two prior trustees. The Attorney-General of the State of New York, which represents the beneficiaries of charitable trusts under EPTL 8-1.1 (f), supported San Diego's position in both actions.

Supreme Court rejected San Diego's application to interpret or amend the Deed of Gift and granted Mercury Bay's motion for a preliminary injunction, declaring the notice of challenge valid. The court held that San Diego's options were to "accept the challenge, forfeit the Cup, or negotiate agreeable terms with the challenger".

Although the parties thereafter made several proposals in an attempt to negotiate agreeable terms, they were unsuccessful, and San Diego proceeded with preparations for its defense of the Cup. In late January 1988, San Diego announced its decision to race in a catamaran whose dimensions, although smaller than Mercury Bay's monohull yacht, fell within the limitations expressed in the Deed of Gift.

Mercury Bay moved to hold San Diego in contempt of Supreme Court's prior order validating Mercury Bay's challenge, arguing that the use of a catamaran, a type of vessel never before raced in an America's Cup match, would deny it the "match" to which it was entitled under the deed because the catamaran is, by design, inherently faster than a monohull vessel. According to Mercury Bay, the deed required the defending club to race a vessel which was "like or similar" to the challenging vessel. Supreme Court denied the motion and directed the parties to reserve their protests until after completion of the America's Cup races. As indicated, the match was held on September 7 and 9, 1988 and San Diego defeated Mercury Bay two races to none.

San Diego had little time to celebrate before it found itself back in court. Mercury Bay moved to have the results of the race set aside, have itself declared the winner and for an order directing that the Cup be awarded to it. Concluding that the deed implicitly required the America's Cup race to be held only between vessels which were "somewhat evenly matched" and that San Diego's use of a catamaran constituted an attempt to "retain the Cup at all costs so that it could host a competition on its own terms" which violated the spirit of the deed, Supreme Court disqualified San Diego's catamaran, declared Mercury Bay the winner of the two races and directed San Diego to transfer the America's Cup to Mercury Bay. In reversing Supreme Court, the Appellate Division concluded that the Deed of Gift unambiguously permitted matches between "yacht[s] or vessel[s]" meeting the length specifications articulated within the deed, that San Diego's catamaran was an eligible vessel, and therefore that San Diego is the rightful holder of the America's Cup. Mercury Bay appeals by leave of the Appellate Division.

II Mercury Bay asks us to set aside the results of the 1988 America's Cup match because, in its view, San Diego's defense of the Cup in a catamaran violated the spirit of the Deed of Gift as exemplified both by its terms and various items of extrinsic evidence. It argues that the donors of the Cup never intended to permit such a catamaran defense because a race between a catamaran and a monohull yacht is an inherently unfair "mismatch" which the monohull yacht has no chance of winning. Instead, Mercury Bay contends that the donors intended to restrict the defender's choice of vessel to the type selected by the challenger and to require further that the particular vessel used afford the challenger a chance of winning the match. Mercury Bay also argues that by sailing a catamaran to defend the Cup, San Diego breached its fiduciary duties as trustee under the Deed of Gift.

Although these arguments are clothed in the legal rubric of interpreting the "intent" of the drafters of the trust instrument and determining the fiduciary duties owed by the trustee, the gravamen of Mercury Bay's complaint is that such a race between a multihull catamaran and a monohull yacht is inherently "unfair", whether or not the donors intended to permit it. The measure of "fairness" in this regard, according to Mercury Bay and the dissenters, are standards of sportsmanship as determined by reference to practices which are presently the custom in sporting activities generally and yacht racing in particular.

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The question of whether particular conduct is "sporting" or "fair" in the context of a particular sporting event, however, is wholly distinct from the question of whether it is legal. Questions of sportsmanship and fairness with respect to sporting contests depend largely upon the rules of the particular sport and the expertise of those knowledgeable in that sport; they are not questions suitable for judicial resolution (see, e.g., Crouch v National Assn. For Stock Car Auto Racing, 845 F2d 397, 403; Finley & Co. v Kuhn, 569 F2d 527, 539). As sporting activities evolve in light of changing preferences and technologies, it would be most inappropriate and counterproductive for the courts to attempt to fix the rules and standards of competition of any particular sport. To do so would likely result in many sporting contests being decided, not in the arena of the sport, but in the courts.

Moreover, the Deed of Gift governing the conduct of the America's Cup competitions contemplates that such issues of fairness and sportsmanship be resolved by members of the yachting community rather than by the courts. The deed provides that where the defending and the challenging yacht clubs have not agreed upon the terms of the match, it is to be conducted as specified in the deed and pursuant to the rules and regulations of the defending club, so long as they do not conflict with the deed. As the deed broadly defines the vessels eligible to compete in the match, it is these rules and regulations which the donors intended to govern disputes relating to racing protocol such as the fairness of the vessels to be used in a particular match. [1] In this case, the dispute over the eligibility of the chosen vessels should have been governed and determined by the rules of yacht racing promulgated by the International Yacht Racing Union (IYRU) and followed by the defending San Diego Yacht Club. Pursuant to these rules, an international jury referees the match and decides all protests jointly submitted to it by the parties. The international jury established to resolve all disputes arising out of the 1988 America's Cup match was composed of five members, all IYRUcertified racing Judges of vast experience and international repute, from countries other than the United States and New Zealand.

Despite Mercury Bay's repeated claims of the unfairness of San Diego's catamaran defense and notwithstanding San Diego's request that a protest be submitted to the international jury, Mercury Bay deliberately chose to keep the issue from these yachting experts, who were of course, best suited to resolve it. Having thus chosen to seek relief in a judicial forum, Mercury Bay is limited to a resolution of only the legal issues presented.

A The legal issue we must determine is whether the donors of the America's Cup, as the settlors of the trust in which it is held, intended to exclude catamarans or otherwise restrict the defender's choice of vessel by the vessel selected by the challenger. Longsettled rules of construction preclude an attempt to divine a settlor's intention by looking first to extrinsic evidence (New York Life Ins. & Trust Co. v Hoyt, 161 NY 1, 8-10). Rather, the trust instrument is to be construed as written and the settlor's intention determined solely from the unambiguous language of the instrument itself (Central Union Trust Co. v Trimble, 255 NY 88, 93; Loch Sheldrake Assocs. v Evans, 306 NY 297, 304; Gross v Cizauskas, 53 AD2d 969, 970). It is only where the court determines the words of the trust instrument to be ambiguous that it may properly resort to extrinsic evidence (New York Life Ins. & Trust Co. v Hoyt, supra; Gross v Cizauskas, 53 AD2d, at 970, supra; 2A Scott, Trusts § 164.1, at 253-254 [Fratcher 4th ed]). The rationale underlying this basic rule of construction is that the words used in the instrument itself are the best evidence of the intention of the drafter of the document. Therefore, we must examine the plain language of the Deed of Gift at issue here.

Contrary to Mercury Bay's contentions, nowhere in the Deed of Gift have the donors expressed an intention to prohibit the use of multihull vessels or to require the defender of the Cup to race a vessel of the same type as the vessel to be used by the challenger. In fact, the unambiguous language of the deed is to the contrary. The deed accords a foreign yacht club "the right of sailing a match for [the America's] Cup, with a yacht or vessel propelled by sails only and constructed in the country to which the Challenging Club belongs, against any one yacht or vessel constructed in the country of the Club holding the Cup" (emphasis added). Given its plain and natural meaning, the phrase "any one yacht or vessel" requires the defender to defend in a single vessel of any type. If, as the dissenters argue, the term "any" was intended to mean "one", in the sense of limiting the defender to a defense in a single vessel (dissenting opn, at 286), the term would be redundant, since the very next word in the phrase so limits the defense to "one" vessel.

By limiting the defense to a single vessel, the deed ensures a "match" which will be a one-on-one competition. In this match, however, the deed expressly permits a defense by any type of yacht or vessel, and restricts the actual vessels to be used only by the length on load water-line restrictions applicable to all "competing vessels", the latter phrase again making clear the donors' intention to leave both the defender's and the challenger's choice of vessel otherwise unrestricted.

Notwithstanding the broad language of the deed, Mercury Bay argues that the donors could not have intended to permit a catamaran defense because the dimensions which the deed requires the challenger to disclose are relevant to monohull but not multihull vessels. This argument misapprehends the role of the dimensions in the competitions contemplated by the deed. Because the deed allows a challenge to be mounted upon 10 months' notice, the defender of the Cup is allowed only this short time to construct a defending vessel although the challenger has had unlimited time to mount a challenge and thus may have taken years

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designing and constructing its challenging vessel. By requiring the challenger to disclose certain dimensions with its 10-month notice, the deed provides the defender with notice of the vessel it will be facing and thus removes the competitive advantage which would otherwise inure to the challenger. For the same reason, the deed does not require the defender to disclose any details about its vessel until the start of the race. Thus, the challenger's disclosed dimensions, which may not be exceeded, limit only the challenging vessel, and do not restrict the defending vessel. So understood, the question of whether the dimensions themselves relate to multihull vessels is simply not relevant to the issue of whether the deed precludes a catamaran defense.

In this case, we are not presented with the issue to which Mercury Bay's arguments are relevant—whether the required dimensions preclude the use of a catamaran by a challenger because the dimensions specified do not relate to multihull vessels and therefore do not provide the defender with the disclosure mandated by the deed. While we have no occasion to address this question, we note that the applicability of the required dimensions to multihull vessels is hotly contested by the parties before us, both of whom have submitted expert evidence supporting their respective positions.

We also reject Mercury Bay's contention that the phrase "friendly competition between foreign countries" connotes a requirement that the defender race a vessel which is of the same type or even substantially similar to the challenging vessel described in the 10month notice. Neither the words themselves nor their position in the deed warrant that construction. Although the stated purpose of the Deed of Gift is to foster "the friendly competition between foreign countries", that general phrase does not delineate any of the specific requirements of the matches to be held. Moreover, while each match is a competition, the deed permits the competitors to both construct and race the fastest vessels possible so long as they fall within the broad criteria of the deed. Thus the defender does not become a competitor only when "the first warning gun of the race goes off" (dissenting opn, at 279); the deed makes clear that the design and construction of the yachts as well as the races, are part of the competition contemplated. Mercury Bay's suggestion, argued explicitly below and implicit here, that the vessels must be evenly matched is belied by its own assertion that the deed permits a match between a 44-foot monohull and a 90-foot monohull—two vessels which, although within the load water-line length restrictions in the deed and of the same type, cannot be said to be "evenly matched" given the much greater speed potential of the larger boat. Indeed, such a requirement that the vessels be "evenly matched" is antithetical to the consent provisions of the deed. There is no point in permitting a defender to give or withhold its consent on the terms of the matches if by simply making a challenge, the challenger could force the defender to accede to its terms. As the Appellate Division majority noted, the donors, who chose to be specific about other aspects of the match, including the load water-line lengths of the competing vessels, could have easily included an express requirement that the vessels be evenly matched but did not do so.

In our view, the phrase "friendly competition between foreign countries" more aptly refers to the spirit of cooperation underlying the competitions contemplated by the deed. The matches were to be between yacht clubs of different countries, and the deed contemplated that they would cooperate as to the details of the matches to be held. It was in this spirit of cooperation that the competitors had, since 1958, agreed to race in 44-foot yachts. Indeed, it was Mercury Bay, not San Diego, that departed the agreedupon conditions of the previous 30 years. San Diego responded to Mercury Bay's competitive strategy by availing itself of the competitive opportunity afforded by the broad specifications in the deed.

Accordingly, we conclude that the unambiguous language of the Deed of Gift, permitting the defending club to defend the Cup in "any one yacht or vessel" within the specified range of load water-line length, does not require the defender to race a vessel of the same type or "evenly matched" to that of the challenger and does not preclude the defender's use of a catamaran. Because the deed provisions on these issues are unambiguous, we may not look beyond the four corners of the deed in ascertaining the donors' intent and therefore may not consider any extrinsic evidence on the meaning of these provisions. Consequently, we reject the analysis of the dissent, which repeatedly resorts to extrinsic evidence to support its construction of the terms of the deed (dissenting opn, at 281-283, 285-286, 287-288). [2]Indeed because the plain language of the Deed of Gift is unambiguous, such resort to extrinsic evidence to impute a different meaning to the terms expressed is improper [3](Central Union Trust Co. v Trimble, 255 NY, at 93, supra).

B We also reject Mercury Bay's contention that notwithstanding the plain language of the Deed of Gift, San Diego breached its fiduciary duty as the trustee of the America's Cup. We have described a fiduciary's duty as requiring "[n]ot honesty alone, but the punctilio of an honor the most sensitive" (Meinhard v Salmon, 249 NY 458, 464; see also, 2A Scott, Trusts § 170, at 311 [Fratcher 4th ed]; Restatement [Second] of Trusts § 170). This strict standard is the usual and appropriate measure of a trustee's fiduciary obligations because the trustee must administer the trust for the benefit of the beneficiaries and cannot compete with the beneficiaries for the benefits of the trust corpus (2A Scott, Trusts § 170 [Fratcher 4th ed]; Restatement [Second] of Trusts § 170).

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Thus, the trustee owes the beneficiary an undivided duty of loyalty and cannot, for example, take the economic benefit of a trust (see, e.g., Matter of Scarborough Props. Corp., 25 NY2d 553, 558).

Unlike the trusts in which this strict rule of undivided loyalty was developed, the America's Cup trust promotes a sporting competition in which the donors clearly intended that the trustee compete on equal terms with the trust beneficiaries. [4]Indeed, the trustee of the America's Cup is obligated to use its best efforts to defend its right to hold the Cup and thus to defeat the beneficiaries in the contemplated competition. It is thus inappropriate and inconsistent with the competitive trust purpose to impose upon the trustee of a sporting trust such as this one the strict standard of behavior which governs the conduct of trustees who are obligated not to compete with the trust beneficiaries.

To be sure, the trustee of the America's Cup is obligated to act in good faith and in the spirit of friendly competition by reasonably attempting to reach an accord on the terms of the matches to be held. Where that is not possible, however, the specific terms of the deed govern and the trustee must use its best efforts to compete for the Cup within the specified terms. As we have discussed, by racing a vessel which met the load water-line specifications in the Deed of Gift and which was constructed in its country, San Diego fully complied with the terms and spirit of the trust instrument. The deed placed no other restraints on the defending club's efforts to win the competition, even though the defending club was also designated the trustee. Thus there can be no argument that the trustee was obligated to construe the deed in a way contrary to its plain language. We conclude that in the context of this sporting trust, San Diego fulfilled its fiduciary obligations by reasonably trying to come to an agreement on the terms for Mercury Bay's proposed match, and failing that, by faithfully adhering to the challenge provisions in the deed.

We reject Mercury Bay's contention that San Diego was required to race a vessel of the same type as its challenging vessel because it was only in that way that San Diego could administer the trust so as to give Mercury Bay, a trust beneficiary, a "fair" competition.

This amounts simply to an argument that San Diego's conduct was "unsportsmanlike" and "unfair", issues which, as we have discussed, the Deed of Gift appropriately leaves to yachting experts.

We conclude therefore that in racing a catamaran, San Diego complied with the terms of the Deed of Gift and did not violate any fiduciary obligation owed under those terms or in [*272] the administration of the trust. Any question as to sportsmanship and fairness, such as the propriety of races between monohull and multihull vessels, are questions which the trust instrument appropriately leaves to the expertise of persons actively involved in yacht racing; they are not questions suitable for judicial resolution.

Accordingly, the order of the Appellate Division should be affirmed, with costs.

Chief Judge Wachtler (concurring). I concur in Judge Alexander's explication of the governing legal principles and his application of them to the facts of this case. While his opinion leaves little room for addition or doubt, in view of the dissent a brief comment about the courts' role in this dispute is necessary.

This case has little or no significance for the law, but it has caught the public eye like few cases in this court's history. Much of the reason for this attention, apparently, is the supposition that here at stake are grand principles—sportsmanship and tradition—pitted against the greed, commercialism and zealotry that threaten to vulgarize sport. In the end, however, the outcome of the case is dictated by elemental legal principles.

I am in full agreement with the court's resolution of this dispute pursuant to those principles. Just as nothing in the America's Cup Deed of Gift prohibited Mercury Bay's unorthodox challenge, which successfully eliminated all other challengers, nothing in that instrument prohibited San Diego's unorthodox defense, which was equally successful. The case should end there.

The dissent, however, would have us go beyond the provisions of the trust instrument and, in the interest of sportsmanship and tradition, impose a duty on the defender to—well, to do just what? To not try too hard to win, it seems. To choose a vessel, not for its potential to win, but for its potential to lose. There is no legal basis for the imposition of such a duty.

More important, perhaps, is that the standard articulated by the dissent would encourage repetition of the most distasteful innovation of all in this case— resolution of the competition in court. If the defender were legally bound to choose a vessel that would ensure a "close" race with the challenger, no defender could be secure in victory without a court order attesting to the fact that it had not won too easily.

It is tempting, of course, to confuse our authority to construe the trust instrument with a license to mold the America's Cup competition in accord with our notions of sporting ideals. Ultimately, however, it must be the contestants, not the courts, who

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define the traditions and ideals of the sport. No one wishes to see the competition debased by commercialism and greed. But if the traditions and ideals of the sport are dependent on judicial coercion, that battle is already lost.

Hancock, Jr., J. (dissenting). "The San Diego Yacht Club and Sail America Foundation said they would meet New Zealand on the water in a three-race series for the America's Cup. But, San Diego officials also said they believe they have the right to set up conditions they think will make it virtually impossible for New Zealand to win" (San Diego Tribune, Dec. 3, 1987 [emphasis added]). [5] This newspaper comment frames the issue before us: was San Diego [6]faithful to its responsibilities as trustee under the New York State America's Cup charitable trust in contriving a catamaran defense for the express purpose of turning the sailing competition into a mismatch and aborting New Zealand's lawful challenge?

This is not a dispute over whether the contest between the monohull and the catamaran was a fair match. It clearly was not. [7]San Diego never intended that it should be. It conceded this point by virtually proclaiming a victory before the start of the races. Indeed, Sail America's President, Malin Burnham, publicly acknowledged in December 1987 that "the speed difference between a large multihull and any size monohull would turn this match into a farce" (emphasis added). [8] From the record, there can be no doubt that San Diego chose the catamaran to race against the monohull for one reason: to be certain that there could be no reasonable possibility of losing. Its purpose was plain—to make sure that it retain the America's Cup so that it could proceed with its plans for the 12- meter competition planned for 1990 or 1991 in San Diego. [9] But, that San Diego concededly construed the Deed of Gift to permit its catamaran defense for the purpose of nullifying the New Zealand challenge does not, without more, end the matter. All agree that the issue is not that simple. The question is whether it was permissible for San Diego to do this. Could San Diego make this construction of the deed, as allowing a catamaran in order to foreclose any possibility of a New Zealand victory, without violating the terms of its trust and thwarting the donors' very aim in establishing the trophy: viz., that "it shall be preserved as a perpetual Challenge Cup for friendly competition between foreign countries" (emphasis added)? Can it be consistent with the duties of a holder and defender as trustee of the America's Cup to meet a lawful challenge by a monohull with a catamaran for the express purpose of avoiding the very competition which the gift of the Cup was intended to promote?

A majority of the court concludes that San Diego's conduct was not in breach of the trust obligations it expressly assumed under the Deed of Gift when it accepted the Cup. It adopts the argument that because there is no express language stating that a yacht must be a monohull and because the Deed of Gift refers to the yacht selected to defend against a challenger as "any one yacht or vessel", the author of the Deed of Gift could not have intended to exclude a catamaran. Defending with a catamaran comes within the literal terms of the Deed of Gift, the majority says, and, for that reason, it concludes that San Diego has remained faithful to its trust. We disagree. [10] The Cup donors—the record clearly shows—never conceived of a catamaran as a vessel that might be entered by either a challenger or defender in America's Cup competition. But, that aside, it is unthinkable that the donors could ever have intended that the trophy holder and defender could construe the Deed of Gift in its favor for the express purpose of creating a mismatch to retain the trophy, thereby subverting the very purpose of their gift in trust. We therefore dissent. We would declare the September 1988 races to be nullities but permit San Diego to have a rematch, if it is so minded, in lieu of forfeiting the America's Cup by default.

I There must be no confusion about New Zealand's contentions or the precise issue before us. Whether San Diego's conduct in construing the Deed of Gift so as to fix in advance the outcome of the races could, as an abstract matter of ethics, be deserving of approval is, of course, not the central point. The real question, as the majority repeatedly reminds us, involves established rules of New York trust law. Was San Diego's unilateral construction of the Deed of Gift to permit a catamaran defense consistent with the trust obligations it agreed to undertake as the custodian of the trophy? This is the precise issue.

It is to resolve this central point and to ascertain the intent and purposes of the donors in establishing the express condition of their gift that the dominant concept of a fair match on equal terms—which is evident in the Deed of Gift and so thoroughly permeates the 130-year history of America's Cup competitions—becomes highly relevant. For it is within the sport of international yacht racing that this charitable trust was created by the experienced yachtsmen who first won the trophy in 1851 by defeating a fleet of British yachts in a race around the Isle of Wight. No one suggests (see, majority opn, at 265, 271-272; concurring opn, at 272-273) that it would be appropriate for the courts to attempt to mediate disputes concerning racing rules or standards of what is fair or appropriate in the actual conduct of yacht races. But certainly the long-accepted general notions of fair competition in yacht racing—and, indeed, the obvious point that sailing two mismatched boats against each other is not a race but a pointless exercise—

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are significant. They help to determine what the yachtsmen who established the trust had in mind in donating the America's Cup "upon the condition that it shall be preserved as a perpetual Challenge Cup for friendly competition between foreign countries" (emphasis added).

And let there be no mistake about this. Contrary to the implications of the majority (at 262-263) and concurring (at 272) opinions, the dispute is not about the propriety of New Zealand's conduct in issuing its challenge. Supreme Court, in a prior proceeding, held that the 90-foot monohull fully conformed with all requirements of the Deed of Gift. In the same proceeding, Justice Ciparick dismissed any suggestion that New Zealand should have adhered to the recent pattern of 12-meter competitions and rejected San Diego's efforts to have the Deed of Gift amended to reflect such requirement (see, Mercury Bay Boating Club v San Diego Yacht Club, Sup Ct, NY County, Nov. 25, 1987, Ciparick, J., CA 72, JA 821; CA 81-82, JA 830-831). Justice Ciparick, in her decision, noted, moreover, that although "San Diego has declined to negotiate with the challenger, Mercury Bay expresses its willingness to participate in a multi-national elimination series, in 1988 using ninety footers, for the right to challenge for the cup and to negotiate other terms". (Emphasis added.) San Diego chose not to appeal Justice Ciparick's rulings. The challenge by New Zealand was unquestionably proper in every respect. [11] Finally, before turning to the merits of the appeal, a comment must be made concerning one other point raised by San Diego. It argues (and the majority appears to give the argument some credence [majority opn, at 266]) that the dispute over interpretation of the Deed of Gift should have been referred to an international jury of "IYRU-certified racing Judges of vast experience and international repute" (id., at 266) and that the propriety of races between monohulls and multihulls vessels is not a question "suitable for judicial resolution." (Id., at 272.) There is simply no support for this argument in the Deed of Gift or elsewhere. The suggestion that a jury of yachtsmen would be the appropriate forum for deciding a question pertaining to the construction of a trust instrument established under New York's charitable trust law is, we believe, best answered in the legal brief submitted jointly on behalf of the amici curiae, renowned yachtsmen from the United States, Great Britain and Australia and yacht clubs of undisputed standing: [12]"First, it is important to bear in mind that the issue here is not whether one vessel or another cut inside or outside a marker. The courts are not being asked to decide whether a foul was committed or to second guess on-the-spot officials by affording the loser a judicial 'replay' of a particularly close finish. Such issues are and should be left to the yachting officials. The issue in this case goes to the fundamental nature of the America's Cup competition and calls for a judicial construction of a trust instrument which SDYC accepted with the express understanding that the 'Deed of Gift shall be governed by, and construed in accordance with', the laws of New York and that 'any proceeding for amendment or interpretation of such terms and conditions [would] be brought before the courts of the State of New York.' " (Amici brief, at 25, n 11 [emphasis added].)

II The holder and defender of America's Cup acts as a trustee. In setting the time and place for the races, in establishing the rules, the courses and other conditions for the competition and in construing the Deed of Gift to decide upon a proper boat to meet the challenger, the defender must act in all respects with nothing less than irreproachable fairness. A defender owes a duty as trustee to any yacht club which may file a challenge against it. But it owes a duty as well to past defenders and trustees of the America's Cup, those who have engaged in America's Cup competitions and to interested members of the international yacht racing community. All have a legitimate concern that an America's Cup challenge be administered in a way that is fully consistent with the underlying concept of maintaining "a perpetual Challenge Cup for friendly competition between foreign countries".

The standards governing the conduct of an America's Cup defenders are those which apply to trustees generally. The classic statement of the standard is that of Chief Judge Cardozo in Meinhard v Salmon (249 NY 458, 464) (quoted by the majority, at 270), "[n]ot honesty alone, but the punctilio of an honor the most sensitive" (see generally, Restatement [Second] of Trusts § 170; 2A Scott, Trusts §§ 170, 170.25 [Fratcher 4th ed]). But, as with any legal duties involving standards of ethics and integrity, it is difficult to define the defender's responsibilities as trustee in other than general terms. There are, nevertheless, aspects of the defender's role as trustee which are particularly instructive. First, of course, the defender's duty as trustee arises in a sport—a context totally foreign to the circumstances where "the morals of the market place" prevail (see, Meinhard v Salmon, supra, at 464). As put by A. Bartlett Giamatti, "the basic convention for any game is the assumption of a level field, that all begin as equals, above board.

Without that convention, there is no contest. * * * The highly moralized (because rule bound) world of any sport is very fragile in the face of the amoral quest for betterment, the hunger to win at any cost, even at the cost of destroying the game". [13] Second, the defender's role is made more sensitive and its actions subjected to a stricter scrutiny because it is a competitor as well as a trustee (see, 2A Scott, Trusts § 170.25 [Fratcher 4th ed] ["(a) trustee occupies a position in which the courts have fixed a very high and very strict standard for his conduct whenever his personal interest comes or may come into conflict with his duty to the beneficiaries" (emphasis added)]; see generally, Restatement [Second] of Trusts § 170). In managing the race, construing the Deed of

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Gift and selecting a proper defending boat the defender is a trustee. Once the first warning gun of the race goes off, the trustee becomes a competitor. The decisions which the defender makes as trustee will obviously affect the ensuing competition, even predetermine it. It would, at the very least, be contrary to the accepted standards of ethics in any sporting event for a competitor, in a position to make a unilateral rule interpretation affecting his opponents' competitive positions, to bend the rule or stretch the language to virtually assure victory for himself.

It is on the dual role of the America's Cup holder as first a trustee and then a competitor that we have a sharp disagreement with the majority. The majority view, apparently, is that the holder-defender in deciding upon a proper boat to meet a challenge is perfectly free, in its role as a competitor, to adopt an adversarial approach in construing the Deed of Gift for the purpose of defeating the challenge without the constraints of its trust obligations. [14]Thus, it concludes that San Diego's "anything goes" policy in giving the Deed of Gift a constricted reading designed to make New Zealand's victory "virtually impossible" was proper. The majority's conclusion is based on a proposition of law for which no precedent has been found.

Although agreeing that Meinhard v Salmon (249 NY 458, supra) states the rule (majority opn, at 270), the majority fails to follow it.

Instead, it holds that it is "inappropriate and inconsistent with the competitive trust purpose to impose upon the trustee of a sporting trust such as this one the strict standard of behavior which governs the conduct of trustees who are obligated not to compete with the trust beneficiaries." (Id., at 271 [emphasis added].) No authority is cited for this proposition. But, that aside, the America's Cup trust is not a so-called "sporting trust" (compare examples of false charitable trusts for "the mere promotion of sports" [4A Scott, Trusts § 374.6A (Fratcher 4th ed); Restatement (Second) of Trusts § 374, comment n, at 262]). There is no question that the America's Cup trust is a valid New York charitable trust. Indeed, the majority points out that no one disputes this (majority opn, at 271, n 4). Nevertheless, the majority offers no explanation of why, in assessing the conduct of this trustee, there should be any deviation from the general rules which would otherwise apply—particularly the rule fixing the very strict standard when the trustee's own interest comes into conflict with the duty owed to the beneficiaries (see, 2A Scott, Trusts § 170.25 [Fratcher 4th ed]).

The provisions of the trust, contained in the amended Deed of Gift of October 24, 1887 signed by Mr. George Schuyler—in three explicit instructions—leave no doubt as to the purposes for which the holder and defender of America's Cup must carry out its responsibilities (see generally, Restatement [Second] of Trusts § 164, comment a; 2A Scott, op. cit., § 164.1). Two of these instructions are set forth in the key sentence expressing the condition of the gift: "This Cup is donated upon the condition that it shall be preserved as a perpetual Challenge Cup for friendly competition between foreign countries" (emphasis added).

The condition of the gift has two components: (1) that the Cup "shall be preserved as a perpetual Challenge Cup", and (2) that it be preserved "for friendly competition between foreign countries". The words "shall be preserved" are mandatory, not precatory (see, McKinney's Cons Laws of NY, Book 1, Statutes § 171; Spencer v Childs, 1 NY2d 103, 106-109). It seems self-evident that a defense of the Cup which is calculated to circumvent a lawful challenge and to avoid any competition would flatly contradict these two instructions.

The third instruction is that a challenger "shall always be entitled to the right of sailing a match for this Cup" (emphasis added).

Again, the language is mandatory, and again, it seems self-evident that a defender cannot act deliberately to prevent "a match" without violating this unequivocal mandate.

There exists compelling evidence of how the original donors intended that the Deed of Gift should be interpreted and the trust carried out. In a letter dated April 15, 1871, George Schuyler, an original America's Cup donor and the signer of the 1887 amended Deed of Gift, ruled that the Deed of Gift did not permit a defending yacht club to defend against a challenge by racing a fleet of yachts against a challenger's single yacht. The ruling was made in connection with a rematch against the New York Yacht Club sought

by Mr. James Ashbury of the Royal Thames Yacht Club. Mr. Ashbury's first challenge in 1870 in his yacht Cambria had been met by the New York Yacht Club with a fleet of 14 defending yachts. Cambria had finished 10th. In connection with his 1871 challenge Mr. Ashbury sought a ruling—which the New York Yacht Club opposed—that a "fleet defense" would not be permitted and that the race would, instead, be one-on- one (see, affidavit of James Michael, Appdx, vol II, at CA 843-845, JA 2292- 2294; Rousmaniere, The Mismatch Question and the America's Cup, at CA 766, JA 2056). Although there was nothing in the deed precluding such a "fleet defense", Mr. Schuyler left no doubt that the instrument would not permit what he viewed as an unacceptable effort by the defending New York Yacht Club to retain the America's Cup at all costs. Mr. Schuyler stated: "It seems to me that the [position of the New York Yacht Club] renders the America's trophy useless as 'a Challenge Cup', and that for all sporting purposes it might as well be laid aside as family plate. I cannot conceive of any yachtsman giving six months' notice that he will cross the ocean for the sole purpose of entering into an almost hopeless contest for this Cup" (emphasis added). (Letter of George Schuyler, Spirit of the Times, Apr. 15, 1871, at CA 514, JA 1318.)

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In resolving the controversy and holding that the Deed of Gift contemplated only a "one-on-one" competition—despite the absence of any limiting language— Mr. Schuyler held that "match" means "one side against the other side" (CA 507, JA 1311). But, significantly—although not necessary to settle the precise dispute before him—Mr. Schuyler set forth his complete definition of "match" in which he included the underscored words which follow: "but the cardinal principle is that, in the absence of all qualifying expressions, 'a match' means one party contending with another party upon equal terms as regards the task or feat to be accomplished" (emphasis added). These words—of critical importance in the instant controversy—can mean only that, in Mr. Schuyler's mind (and in the minds of the original donors), a race to be considered a "match" as contemplated in America's Cup competition would have to be one which was fair and on equal terms.

That the notion of a fair match on equal terms is inherent in the concepts of a "Challenge Cup" and "friendly competition between foreign countries" is confirmed by the history of America's Cup races. In the 26 matches conducted since the original gift in 1857, the competing yachts have borne a close resemblance to each other with each vessel having a reasonable chance to win. In all of the races until 1988, the defenders and challengers have been monohulls. With the exception of the challenge in 1870 (the year of the controversial "fleet defense" victory over the British yacht Cambria), the defenders and the challengers have been of virtually the same length on the waterline. [15] Again, in 1887, George Schuyler—in his handling of another problem that had arisen in connection with a challenge—underscored the dominant theme of his 1871 letter: that the governing principle of America's Cup competition is fairness, that a race between a challenger and defender for the "Challenge Cup" should be a fair match on equal terms. When the Scottish challenger Thistle arrived in New York for her challenge against the New York Yacht Club, it measured 1.4 feet longer on the waterline than had been represented, giving it a speed advantage over the defending yacht which had been built to match the shorter length. Although George Schuyler chose not to disqualify Thistle, he gave her a time handicap to make it a fair match on equal terms.

In 1890, another noted New York yachtsman reemphasized the recurring theme of fairness. Joseph Busk, who had served on the New York Yacht's Club America's Cup committee, in explaining the 1887 Deed of Gift in reply to a letter from the Earl of Dunraven which had criticized it, wrote: "In drawing the new rules the idea was to eliminate, as much as possible, the chance of the Cup being won or held by trick, device or surprise and to make it a trophy to be won by fair sailing in a match between the best representative boats that could be produced by either side" (CA 787, JA 2077 [emphasis added]). [16] III It is basic that a trustee is legally bound to carry out its trust solely for the interests of the beneficiaries (see, Restatement [Second] of Trusts § 170 [1]; 2A Scott, op. cit., § 170). Ordinarily a court will not inquire into the motives of the trustee. But, if it is shown that its motives were improper the court will intervene. Thus, "if the trustee in exercising or failing to exercise a power does so because of spite or prejudice or to further some interest of [its] own or a person other than the beneficiary, the court will interpose" (Restatement [Second] of Trusts § 187, comment g, at 404 [emphasis added]; see, Matter of Bruches, 67 AD2d 456, 462; 2A Scott, op. cit., § 170.25). It is in the light of these rules that San Diego's conduct as trustee must be examined.

In deciding whether San Diego has acted properly in construing the Deed of Gift to permit its catamaran defense, we must not analyze the language as if it were contained in a contract drawn between two parties dealing at arm's length. We must construe the Deed of Gift as a trustee should construe it. The question is whether San Diego—charged with acting solely for the interest of the beneficiaries and not for its own interests—has fairly and objectively construed the language of the Deed of Gift.

The question is not the hypothetical one of whether under any circumstances a catamaran could be permitted—e.g., whether a challenger could test the Deed of Gift by making a challenge with a catamaran. The challenging yacht club is not a trustee; only the defending yacht club is. Only the defender must act with the objectivity required of a trustee. Thus, resolution of the decisive issue— whether the Deed of Gift has been properly construed—depends not on whether the Deed of Gift can be read to encompass a catamaran but on whether San Diego, as trustee, ought to have read it that way. In other words, could San Diego give it a literalistic and narrow construction so as to permit itself to defend with a catamaran against a monohull without violating the trust?

Forget, for the moment, the defender's obligations as trustee and ignore everything in the Deed of Gift except the fifth and sixth paragraphs dealing with yacht dimensions and notice requirements. Even then, the conclusion is inescapable that a catamaran as a putative America's Cup contender could not have been contemplated. The only dimension restriction is one that can have no relevance to a catamaran: length on the load waterline (not less than 44 feet, nor more than 90 feet for a single-masted yacht). No one can seriously dispute the proposition that water-line length serves as a rough measure for the hull speed of a monohull sailing vessel, but does not do so for a catamaran. (See, supra, at 282-283, n 11, regarding rule-of-thumb—hull speed in knots of monohull equals square root of twice load water-line length in feet.)

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For many reasons, this relationship of water-line length to hull speed does not apply to catamarans. For example, the twin hulls of the catamaran can be long, narrow and widely spaced. Because it can achieve its necessary stability from the wide-spacing of its two hulls, a catamaran can be much lighter than a monohull (e.g., 75,000 pounds for monohull New Zealand as contrasted with 6,000 pounds for the catamaran Stars and Stripes). And because of their long, narrow shape, the two hulls create considerably less wetted surface than would be the case for a comparable monohull. The result is that the catamaran has a vastly superior power to weight ratio, and far less drag. Also, of course, a catamaran has the additional advantage of being able, under certain conditions, to lift one hull from the water (i.e., to "fly a hull"), thereby reducing drag even further and increasing speed. [17] But the very facts in this case provide the ultimate proof of the proposition that the general relationship between load waterline and hull speed does not hold true for catamarans. San Diego, knowing that New Zealand measured 90 feet on the load waterline, built a catamaran of 60 feet, 30 feet shorter, yet was assured that the race would be "no contest". The catamaran's speed potential was estimated at more than 22 knots. [18]Applying the monohull rule-of-thumb to the 60-foot catamaran produces the figure 10.95, a mathematical result without any nautical, physical or other significance.

The requirements in the 1887 amended Deed of Gift, signed by Mr. Schuyler, that the challenger must give the defender 10 months' notice of its load water- line length and that the challenger's yacht may not exceed that length (reflecting Mr. Schuyler's experience in the Thistle controversy) serve the obvious purpose of giving the defender definite and binding advance notice about the challenger's speed so that it can construct a defending yacht of comparable size and capability. Indeed, George Schuyler, in his letter of September 24, 1887 referring to the Thistle controversy, emphasized the great "importance of accuracy in giving the dimensions [i.e., water-line length] of a yacht challenging for the Cup" (Appdx, at CA 1004, JA 2562 [emphasis added]). But the requirement for specification and notification of load water-line length would have had no "importance" and no meaning if considered applicable to catamarans. It can hardly be thought that Mr. Schuyler, a lawyer and yachtsman of unquestioned competence, would have sanctioned the drafting of a provision which could have served no purpose. [19] Another provision in the 1887 Deed of Gift specifically permits "centre-board or sliding keel vessels" and prescribes that there be no limitation "upon the use of such centre-board or sliding keel" and that "the centre-board or sliding keel" shall not be considered a part of the vessel for measurement purposes. It is a reasonable inference from the fact that "centre-board or sliding keel" is invariably referred to in the singular that the drafter had in mind a vessel with one hull, using one centre-board or sliding keel, not a catamaran having two hulls and two centre-boards or sliding keels.

San Diego, in dismissing these undeniably compelling signs that only monohulls were contemplated, relies almost entirely on the reference in the October 24, 1887 amended Deed of Gift to the defender's yacht as "any one yacht or vessel constructed in the country of the Club holding the Cup" (emphasis added). In its argument, San Diego rejects the primary meaning [20]of the word "any" and the sense in which it clearly appears Mr. Schuyler, who added it, intended that it be understood—i.e., as limiting the defending yacht club to a defense by only "one" yacht as opposed to more than one (see, discussion, infra, at 287-288). Instead, San Diego adopts a secondary meaning [21]of "any" and reads the word as signifying that there should be no limit on the types or kinds of yachts or vessels chosen to meet a challenger and that Mr. Schuyler, therefore, must have intended that the phrase "against any one yacht or vessel" be read broadly to include catamarans.

Nothing in the Deed of Gift or its history suggests that Mr. Schuyler thought that the word "any" would ever be understood as having some relation to the types or kinds of vessels or that the word would be given a meaning other than its primary one. On the contrary, the history of the amendment of the Deed of Gift shows conclusively that San Diego's construction is wrong. Mr. Schuyler used the word "any"—juxtaposed in the added phrase with the word "one"—in its primary and restrictive sense to mean one yacht or vessel as opposed to more than one. The phrase "against any one yacht or vessel" (emphasis added) was added by Mr. Schuyler solely to assure that future America's Cup defenses would be in a single yacht, thus preventing any possibility of another attempted "fleet defense" of the type the British challenger Cambria had been forced to meet in 1870. (See, supra, at 281-282; Letter of George Schuyler, Spirit of the Times, Apr. 15, 1871, at CA 505, 514, JA 1309, 1318.) [22] San Diego goes to great lengths to make it appear that in this country in the late 19th century catamarans were customarily accepted as competitors in ocean yacht racing. The unrefuted record demonstrates just the contrary. Catamarans were small, largely experimental and certainly not generally accepted in established yacht races. Indeed, the research reveals that only 48 catamarans existed in this country between 1820 and 1890. (See, affidavit of Daniel Charles, at CA 590-598, JA 1491-1499.) [23]What is clear, moreover, is that catamarans were never considered in connection with America's Cup races. Indeed, in the 19th century they were too small and not sufficiently seaworthy to make the open ocean voyage which would ordinarily be required to get to the site of the race. [24]

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It adds nothing to note (majority opn, at 269) that the dimension specifications in the Deed of Gift would theoretically permit the absurd spectacle of a 44-foot monohull racing against a much faster 90-foot monohull. Obviously, the argument is not germane to the question of whether the Deed of Gift permits a catamaran. Beyond that, if the point is that the Deed of Gift would permit a defender to assure its victory by overwhelming a smaller monohull with a larger and faster monohull, the argument overlooks the point that the defender is trustee. One could hardly suggest that such conduct would promote "friendly competition between foreign countries". The history of America's Cup, of course, proves that such an obvious mismatch created by a defender would never have been tolerated. [25] The foregoing (and the balance of the evidence in this voluminous record), we are convinced, confirms that the Deed of Gift, in its original and amended forms, contemplated only monohulls. But, even if that issue were much closer, the critical question would remain. Did San Diego, in resolving the disputed issue in its own favor, adhere to the "very high and very strict standard [which the courts have fixed for the conduct of a trustee] whenever [its] personal interest comes or may come into conflict with [its] duty to the beneficiaries"? (Emphasis added; 2A Scott, Trusts § 170.25 [Fratcher 4th ed].) We believe that, based on facts in the record which are either conceded or not seriously controverted and on established rules of New York trust law, the answer must be "no". The following analysis demonstrates why.

Under settled principles of trust law (see, e.g., Restatement [Second] of Trusts § 187, comment g, at 404), it would ordinarily follow that San Diego's construction of the Deed of Gift for its own purposes so as to permit a catamaran defense would make it liable for breach of its trust. San Diego argues, however, that the fact that it acted for its own interests is irrelevant because its construction of the Deed of Gift was unquestionably correct. In effect, it contends that it did the right thing, although, perhaps, for the wrong reasons. This is obviously its posture in contending that the "any one yacht or vessel" clause gives it a total license as to the type of vessel and that it, therefore, had the absolute "right to set up conditions [it believed would] make it virtually impossible for New Zealand to win" (emphasis added; comment, San Diego Tribune, Dec. 3, 1987, supra, at 273; see, similar comments and expressions in nn 3, 4 and 5, supra, at 273-274).

Thus, the question ultimately comes to this: was San Diego's choice of the catamaran a cut-and-dried decision made as a matter of routine? Is San Diego correct in construing the Deed of Gift as giving it the power to stifle any chance of a New Zealand victory by choosing a catamaran defense? In no sense, regardless of any of San Diego's arguments on the Deed of Gift, was the question cutand-dried or the choice a matter of routine. Under any reasonable view, San Diego would have to concede the existence of ambiguity in the Deed of Gift on the question of permitting a catamaran defense and substantial doubt as to the correctness of its construction. At the very least, the decision required San Diego to exercise reasoned judgment which "could typically produce different acceptable results" (Tango v Tulevech, 61 NY2d 34, 41)—i.e., a judgment, as trustee, that was quasi-judicial in nature.

Because, as trustee, it could make decisions of competitive advantage to itself and disadvantage to challenger-beneficiaries, it was bound to adhere to the "very high and very strict standard" which the law imposes (see, 2A Scott, op. cit., § 170.25).

San Diego, in making a rigid and overly literal construction of the Deed of Gift, did so for its own interest and contrary to the interests of the beneficiaries. San Diego, therefore, violated its duty as trustee under the Deed of Gift in defending with a catamaran, and should not have been declared the winner of the two races.

IV At the root of this appeal, we submit, is a fundamental disagreement as to the standards by which San Diego's conduct as trustee should be measured. San Diego has obviously applied the standard "of the market place" (Meinhard v Salmon, supra, at 464) in assuming, as it did, that it was completely justified in adopting an "anything goes" interpretation of the Deed of Gift for the purpose of making it "virtually impossible for New Zealand to win". Thus, without hesitation, San Diego has adopted its rigid construction of the "against any one yacht or vessel" clause. It has consistently approached the case as though it involved a dispute over the meaning of a business contract made between two parties at arm's length. San Diego's attitude, we believe, is epitomized in a statement given by Dennis Conner to Life Magazine concerning his assessment of America's Cup competition: " 'Sportsmanship is nonexistent. This isn't tiddlywinks; it's business * * * there has never been any sportsmanship in the America's Cup. Anyone who thinks so is kidding himself.' " (Article, No Match America's Cup 1988, at CA 971, JA 2515 [quoting Life Magazine, Sept. 1989].) [26] There are certainly those who, like Mr. Conner, believe that America's Cup has become a business, even one debased by "greed, commercialism and zealotry" (see, concurring opn, at 272). Perhaps, the reality is that it has come to that. Still, there are those who believe that America's Cup remains and should remain a sporting event in the accepted tradition where "identical conditions and norms [are imposed] upon play, [and] the essential assumption of all the rules is that skill or merit will win out" (Giamatti, Take Time

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for Paradise: Americans and Their Games, at 60 [Summit Books 1989]). Whether the more cynical assessments of America's Cup are correct is for the yacht racing community and public to decide.

But, irrespective of one's attitude toward America's Cup competition, one thing is certain: the standards of "the marketplace" cannot be the measure of San Diego's conduct as defender and as a trustee under New York law. San Diego and New Zealand cannot be viewed as parties who are in dispute over some terms in a bargained-for agreement. One is a trustee, the other is not. It is the law of trusts which applies, not the law of contracts.

It is this critical aspect of San Diego's role as holder and defender of America's Cup and its attendant obligations as trustee which the Attorney- General overlooks in his criticism of the trial court for her application of a "different standard in assessing the propriety of San Diego's defense than it did in evaluating Mercury Bay's initial Notice of Challenge" (emphasis added; brief of Attorney-General, at 28). Indeed, the majority rejects this same crucial distinction in its comment that because San Diego considered New Zealand's monohull to be "unorthodox", San Diego's conduct was fully justified when it "responded to Mercury Bay's competitive strategy [i.e., its legal monohull challenge] by availing itself of the competitive opportunity afforded by the broad specifications in the deed."

(Majority opn, at 269 [emphasis added].)

But, Justice Ciparick was quite correct in holding San Diego to the higher standard in "assessing the propriety of [its] defense", for only San Diego was a trustee. When it won the America's Cup at Freemantle in February 1987, San Diego formally agreed to accept it in trust pursuant to the following provision in the Deed of Gift: "[San Diego] hereby accepts the said Cup subject to the said trust, terms, and conditions, and hereby covenants and agrees to and with the said party of the first party that it will faithfully and fully see that the foregoing conditions are fully observed and complied with" (emphasis added).

Judge Titone and I would "impose a duty on the defender to—well, to do just what?", the concurrer asks (concurring opn, at 272).

This question as to San Diego's duty is, of course, the critical one. We think it has been clearly answered. As trustee under the Deed of Gift, San Diego had the legal duty to meet the "very high and very strict standards" which the law imposed upon it because, in its dual role as competitor and trustee, its interests were in conflict with the interests of the beneficiaries, including the challenger (see, 2A Scott, Trusts § 170.25 [Fratcher 4th ed]). It is this duty which San Diego ignored in adopting a constricted reading of the "any one yacht or vessel" clause to sanction its choice of a catamaran and assure New Zealand's defeat.

V There remains the question of appropriate relief. In our opinion, the races held on September 7 and September 9, 1988 should be declared nullities. San Diego should not, however, be held to have automatically forfeited the America's Cup. The matter should be remanded to Supreme Court for the purpose of fashioning an order which would give San Diego a reasonable period of time, if it so desires, to arrange for and conduct a new series of races in which it can meet the New Zealand challenge in a defending yacht or vessel which complies with the Deed of Gift. In the event that San Diego does not avail itself of this option, it should be considered to have defaulted in the face of New Zealand's lawful challenge and the America's Cup should be awarded to the Mercury Bay Boating Club Inc. We believe this outcome is compelled, under the circumstances, by notions of fairness, considering particularly: (1) that the September 1988 races were held pursuant to an order of Supreme Court without a ruling as to the legality of the catamaran defense, and (2) that San Diego's interpretation of the Deed of Gift was approved by the New York State Attorney-General.

Chief Judge Wachtler and Judges Simons, Kaye and Bellacosa concur with Judge Alexander; Chief Judge Wachtler concurs in a separate opinion; Judge Hancock, Jr., dissents and votes to reverse in another opinion in which Judge Titone concurs.

Order affirmed, with costs.

Footnotes Footnote 1: The Deed of Gift provides: "In case the parties cannot mutually agree upon the terms of a match, then three races shall be sailed, and the winner of two of such races shall be entitled to the Cup. All such races shall be on ocean courses * * * [These ocean courses] shall be selected by the Club holding the Cup; and these races shall be sailed subject to its rules and regulations so far as the same do not conflict with the provisions of this deed of gift, but without any time allowances whatever" (emphasis added). In light of this plain language, and the undisputed fact that the applicable rules of the San Diego Yacht Club provide that an IYRU jury was to resolve protests arising out of the match, the fact that amici curiae argue that the courts should resolve the question of the propriety of San Diego's defense (see, dissenting opn, at 277-278) is simply irrelevant. This court may properly determine only the legal issues with which it is presented.

Footnote 2: Nor is it appropriate to our judicial function to rely in our analysis upon the various views expressed in the media as to the merit of the contentions of these litigants.

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Footnote 3: The fallacy of this approach is demonstrated by the writings in this case. The dissenters, agreeing with Supreme Court, read selected portions of various items of extrinsic evidence to support their position. A majority of the Appellate Division, however, upon reviewing that same extrinsic evidence, reached precisely the opposite conclusion (see, Mercury Bay Boating Club v San Diego Yacht Club, 150 AD2d 82, 93-95). Thus contrary to the view taken by the dissenters, the extrinsic evidence is neither unassailably consistent nor dispositive and should not be read to contradict the plain language of the trust instrument itself.

Footnote 4: While there is authority for the proposition that trusts created for the purpose of promoting sporting events are not true charitable trusts (see, Restatement [Second] of Trusts § 374, at 262; 4A Scott, Trusts § 374.6A, at 227-228 [Fratcher 4th ed]; In Re Nottage, 2 Ch 649 [Eng 1895] [trust to promote the sport of yacht racing is not a charitable trust]), no one has disputed the characterization of this trust as a charitable trust.

Footnote 5: (Appdx, vol I, at CA 437, JA 1157 [cited in Mercury Bay brief on app, at 18].)

Footnote 6: "San Diego" will be used throughout to refer to San Diego Yacht Club, Inc. and to groups or individuals directly associated with it such as Sail America Foundation, Manager of San Diego Yacht Club's America's Cup defense.

"New Zealand" will be used to refer to the challenger, Mercury Bay Boating Club Inc., and persons or groups directly associated with it such as Michael Fay, head of the New Zealand Yachting Group and the monohull's chief backer.

Footnote 7: The catamaran won the first race by 212 miles and by 18 minutes, 15 seconds; the second race by more than four miles, and by 21 minutes, 10 seconds. The overwhelming consensus of opinion was that it was "one of the greatest mismatches in history" (Poe, A-Cup XXVII, Santana, Oct. 1988, Appdx, vol II, at CA 959, JA 2503; see, similar comment of Frank Snyder, Commodore of New York Yacht Club, Appdx, vol II, at CA 755-756, JA 2045- 2046). Moreover, the post race consensus was that the catamaran had not been sailed to its speed potential. David Poe who followed the catamaran in the press boat observed that "Dennis [Connor, the Skipper of Stars and Stripes,] did a lot of dawdling on the race course to make it look close * * * [and that] it was obvious that Dennis was frequently pointing too high, even luffing his jib and the instant the hull came out of the water, plop back down it went" (A-Cup XXVII, Santana, Oct. 1988, id., at CA 959, JA 2503; see, Mercury Bay brief on app, at 22-24, for similar observations, for editorial comments, and for other relevant record citations).

Footnote 8: San Diego Union, Thurs., Dec. 3, 1987 (Appdx, vol I, at CA 433, JA 1153). (See also, comment of Dennis Conner, Skipper of Stars and Stripes, made in USA Today, Sept. 9, 1988 that "[t]he catamaran is a tool to deal with the problem—an unwanted problem" [id., at CA 1037, JA 2826]; comment of Britton Chance, a member of San Diego's Design Team: "The ability to beat the monohull with a multi-hull would not be an issue. The multi-hull is going to win every time barring bad design, bad construction or bad execution." [Providence Journal, Dec. 23, 1987, id., vol I, at CA 441, JA 1167].)

Footnote 9: Malin Burnham could not have been more frank in announcing the San Diego group's overriding objective: "If we have to race Fay [the chief backer of the New Zealand] in 1988, we want to be sure we can put his challenge away with little trouble. We don't want to do anything to risk San Diego losing the 1991 series." (Sports Illustrated, Dec. 7, 1987, Appdx, vol I, at CA 331, JA 1012.)

(For references to additional similar comments see, Mercury Bay brief on app, at 18.)

Footnote 10: The concurrence misreads the dissent as maintaining that the court should impose some undefined duty on the defender "in the interest of sportsmanship and tradition"—a duty to "not try too hard to win, it seems." (Concurring opn, at 272.)

This is not the position of the dissent and plainly not what it says. As is fully apparent (see, e.g., infra, at 275), the position of the dissent is that San Diego had a legal duty as trustee of the America's Cup—a valid New York State charitable trust—to make a fairly considered and unbiased construction of the Deed of Gift in its selection of a defending yacht. It is whether San Diego violated this legal duty—not some dispute over ethics in sports or racing rules or what would "ensure a 'close' race" (concurring opn, at 272)— which is the central question. The position of the dissent is simply stated: San Diego violated its duty as trustee in deliberately construing the Deed of Gift for its own benefit so as to permit a catamaran defense for the express purpose of avoiding the very competition for which the donors established the America's Cup trust. There is no disagreement that "elemental legal principles" (concurring opn, at 272) dictate the outcome of this case. Our disagreement is over what these principles are and how they should be applied. It is the question of San Diego's legal duty under the New York law of trusts—irrespective of its importance to society or to the law as a precedent—which we must decide. It is solely this question we address.

Footnote 11: San Diego, nevertheless, persists in its efforts to cast doubt on the propriety of New Zealand's conduct, suggesting that New Zealand's departure from the 12-meter format of recent years, while concededly legal, was somehow improper. The suggestion apparently viewed with some favor by the majority (majority opn, at 262-263, 269) is surprising in view of Justice Ciparick's unappealed decision, in which she stated, inter alia, that it "is not at all clear that a challenge involving ninety footers would be more

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expensive than racing in twelve-meter yachts" and that "it appears that ninety footers may be ideal and twelve-meter boats illsuited for a competition to be held in San Diego with its light winds". The suggestion is all the more surprising in view of the letter to Fred Frye, Commodore of the San Diego Yacht Club, sent by James Michael before San Diego decided on a catamaran (CA 176, JA 122; CA 177, JA 123) stating, in part, that "a match between two 90-foot load water-line yachts surely comes closer to the contemplation of [the donor,] George L. Schuyler * * * than do 12-meters" and that such a match "could be every bit as competitive as one between two 12-meters, and very likely would be of much more worldwide interest, considering that the yachts could be expressly designed for the San Diego conditions". James Michael, among other things, is past commodore of the Cruising Club of America, past president of the U.S. Yacht Racing Association and a former trustee of the New York Yacht Club who served on its America's Cup committee from 1971 to 1983.

Footnote 12: The final list of amici included the following: Robert N. Bavier, Jr.; John Bertrand; Alan Bond; Courageous Sailing Center of Boston, Inc.; William P. Ficker; Sir James Hardy; Frederick E. "Ted" Hood; Gordon Ingate; Ischoda Yacht Club, South Norwalk, Connecticut; Warren Jones; Arthur Knapp, Jr.; Graham Mann; Robert W. McCullough; Emil "Bus" Mosbacher, Jr.; Noel Robbins; Jock Sturrock; and Ted Turner.

Among these amici are nearly all of the skippers of both the challengers and the defenders in the matches held since World War II. Footnote 13: Giamatti, Take Time for Paradise: Americans and Their Games, at 62-63 (Summit Books, 1989).

Footnote 14: See, e.g., the majority's statement that San Diego was justified in responding to the challenge "by availing itself of the competitive opportunity afforded by the broad specifications in the deed." (Majority opn, at 269 [emphasis added].)

Footnote 15: The importance of having closely matched load water-line lengths in racing monohulls is that the length on the load waterline of a monohull keel yacht bears a direct relationship to its hull speed. An accepted rule- of-thumb is that the square root of twice the load water-line length of a monohull keel yacht in feet is approximately equal to the yacht's hull speed in knots. For example, for a yacht with a load water-line length of 32 feet, the hull speed is approximately equal to the square root of 64, or 8 kts.

Except for four occasions during the history of America's Cup from 1870 until 1958, when the 12-meter competitions began, the defenders were shorter on the waterline than the challengers. In the case of the four exceptions, the defenders were very slightly longer (see, chart of dimensions of America's Cup defender and challenges from 1870-1983, Appdx, at CA 879-882, JA 2387-2390).

Footnote 16: Joseph Busk, commenting on the concept that most matches would be held under the "mutual agreement clause" also stated in his letter to the Earl of Dunraven: "the whole of the present deed hinges on this idea as it was never supposed that any club would refuse to make a fair sporting match" (CA 788, JA 2078 [emphasis in original]).

Footnote 17: See, Mr. Justice Rubin's succinct explanation in Mercury Bay Boating Club v San Diego Yacht Club (150 AD2d 82, 106107 [Rubin, J., concurring]; see also, affidavit of John Brian Shuttleworth [CA 992, 996, JA 2536, 2540]).

Footnote 18: See, e.g., Ballard, Sailing Back to the Future, Sports Illustrated, Dec. 7, 1987, at CA 330, JA 1011; see also, article, The America's Cup— An Irish Joke, at CA 394, JA 1112; article, " 'Time's a Wasting,' " Says Designer of U.S. Cup Defender, Providence Journal, Dec. 13, 1987, at CA 441, JA 1161; article, Counterpoint: The Views of Dick Newick, Sailing World, Mar. 1988, at CA 387, JA 1105; article, Mono vs. Multi: An America's Cup Scenario, Sailing World, Apr. 1988, at CA 390, JA 1103).

Footnote 19: It is, of course, the identity of the dimension which the Deed of Gift specifies—i.e., length on the load waterline—and the importance attached to the accurate submission of this dimension which are so highly relevant and helpful on the question of whether catamarans were contemplated. Because this "important" load water-line dimension has meaning when applied to monohulls but none when applied to catamarans, it seems evident that catamarans were never considered. It is of no significance to this central point that only the challenger is required under the Deed of Gift to give notification of the dimensions of the challenging yacht and that, of course, only the challenger is bound by the dimensions it submits to the defender (see, majority opn, at 268; see, discussion, infra, at 288).

Footnote 20: The primary definition of "any" in Webster's New 20th Century Dictionary, Second Edition is: "1. one (no matter which) of more than two; as any boy may go."

Footnote 21: The secondary definition of "any" in the Webster's New 20th Century Dictionary, Second Edition is: "2. some (no matter how much, how many, or what kind); as, do you have any apples?"

Footnote 22: The Schuyler letter of April 15, 1871 establishes beyond doubt that the only purpose of adding the phrase "against any one yacht or vessel" was to clarify what Mr. Schuyler thought was already implicit in the original Deed of Gift—that one challenger should race against one defender. Indeed, it appears from that letter that Mr. Schuyler in 1871 thought that adding the words in the

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phrase "against any one yacht or vessel" (later added to the Deed of Gift in 1887) "would have been unnecessary and superfluous" (CA 506, JA 1310 [emphasis added]).

Footnote 23: John Rousmaniere, a yacht historian, writing in Sailing World stated that "there is every reason to believe that George Schuyler would have found the prospect [racing multihulls in America's Cup competition] ludicrous both then and now. First, the legal standing of multihulls as racing yachts was severely questioned in the 1870's and after. While multihulls were not unknown in European and American yachting before then, they were not considered anything more than experimental toys until Nathanael Herreshoff turned up at some Long Island Sound regattas in 1876 in his ingenious 25-foot LOA cat Amaryllis. * * * [e]ven proponents of catamarans admitted that they were dangerous in rough water. Certainly they were not seaworthy enough to cross an ocean to sail in a Cup match" (emphasis added). (See, CA 334-335, JA 1047-1048.)

Footnote 24: See, references in Schuyler letter, April 15, 1871, to the necessity for challengers to make ocean crossings (CA 510, JA 1314; CA 512, JA 1316; CA 514, JA 1318; majority opn, at 262 [Deed of Gift was amended in 1956 "to eliminate the requirement that the challenging vessel sail to the match 'on its own bottom', a requirement that had disadvantaged foreign challengers"]; comment of yacht historian Rousmaniere, underscored last sentence, n 19, supra,).

Footnote 25: See, discussion of the Thistle challenge, supra, at 283; see also, history of America's Cup challenges, supra, at 281-282; Chart of Dimensions of America's Cup Defender and Challenges from 1870-1983 showing closeness of load water-line lengths of challengers and defenders, Appdx, at CA 879, JA 2387.

Footnote 26: This same feeling is reflected in a statement made by the concurrer at the Appellate Division that he could not "agree, however, with the proposition that the America's Cup competition is now, if it ever was, a paradigm of good sportsmanship" (150 AD2d 82, 107 [concurring opn, Rubin, J.]).

Case 12: Golden Gate Yacht Club v. Société Nautique De Genève, 2009 NY Slip Op 32719(U) (N.Y. Sup. Ct. 11/17/2009) 2009 N.Y. Slip Op. 32719 (N.Y. Sup. Ct. 2009) The Court ORDERED that an independent expert panel be assembled to provide qualified answers to certain inquiries of that Court.

This action is the Court’s culmination of that process.

November 17, 2009 KOKNREICH, SHIRLEY WERNER, J.: I. Background By decision and order dated October 30, 2009, the court directed each party to designate an independent, unaffiliated expert who had previously sat on an America's Cup Jury and chose two experts to select a third neutral expert who also had sat on an America's Cup Jury. These three experts were in turn directed to appear at a hearing to testify regarding five issues delineated by the court.

On November 2, 2009, David Tillett, the third independent expert, wrote to the court suggesting that the expert panel hear submissions from the parties then submit an advisory opinion to the court. The parties agreed to the procedure, and on November 6, 2009, the court "so ordered" a consent order to that effect. After a hearing held on November 7, 2009, the expert panel issued a November 8, 2009 opinion, which was submitted to the court on November 9, 2009. On November 13, 2009, plaintiff Golden Gate Yacht Club (GGYC) submitted a Memorandum of Law in Support of Adoption of the Expert Panel's Recommendations. By letter that same date, defendant Société Nautique de Geneve (SNG) urged the court to reject the expert Panel’s recommendation regarding measurement of load waterline (the court’s lssue 1 in the October 30 order). SNG also argued that the court’s remaining issues (Issues 2-5) were moot in light of “recent developments” and that any decision on the merits of these now moot issues would be an impermissible advisory opinion. See Saratoga County Chamber of Commerce v Pataki, 100 NY2d 801, 8 1 0-8 1 1 (2003) (finding court’s jurisdiction extends only to live controversies).

II. Discussion

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At the outset, the court finds that the expert panel was independent, well qualified and appointed in accordance with the requirements of the court’s October 30, 2009 decision. The individual Panel members’ qualifications were set forth fully in the parties’ submissions, and the court will not repeat them here. Their opinion was unanimous. The court will separately address each of the five issues and will set forth as much of the expert Panel’s opinion as the court deems necessary to explain its decision.

ISSUE 1: How “load water-line” is measured in an America’s Cup race, including but not limited to whether SNG can exclude movable ballast from the measurement and whether the same procedures are used when dealing with a catamaran and or trimaran.

Panel Opinion: 20. It is the Panel’s opinion that with respect to catamarans and trimarans, for the purpose of measurement of load water-line, the principle of being “fully loaded” when measured, should be employed. This would be consistent with the [America’s Cup] measurement rules provision in 1988. Any moveable ballast should be distributed equally in the available ballast storage areas, and should include as much water ballast as might be used at any time during any race.

21. The Panel recommends that the Court require SNG to arrange for the Event Measurer to write and publish measurement procedures after consulting with both competitors, in terms of the above paragraph, to include requirements of positioning of ballast and crew during measurement and any other necessary procedures.

SNG responds that it is governed by the rules of the Association des Clubs de Voile de la Region Lemanique (ACVL), which rules provide that multi-hulls must be measured with water ballast empty. The expert Panel concluded that the ACVL rules “do not apply to America’s Cup boats with respect to the determination of load water line.”

The court adopts the Panel’s opinion on Issue 1. The context in which this issue arose is material to the court’s decision. On August 6, 2009, SNG issued measurement procedures that allow ballast to be added to an America’s Cup vessel after it has been measured.

GGYC argued that this measurement procedure violates the Deed of Gift, which states that competing vessels may not be longer than ninety feet on the “load water-line.” Apparently, adding ballast sinks the vessel deeper in the water and increases its length on load water-line, so under SNG’s procedures, a vessel can weigh in at a Deed-compliant length, then attain a length that violates the Deed after ballast is added.

As the court found previously, under New York law, “[t]he judicial interpretive function is to find the meaning of the testator as expressed in the language used, considered in the light of the attendant circumstances, and effectuate it.” In re Gross, 75 AD2d 531 (1st Dcpi 1980), quoting Matter of Nicol, 24 AD2d 191, 197 (1st Dept 1965). If the testator’s language is clear and unambiguous, the inquiry ends there. Mercury Bay Boating Club, Inc. v Sun Diego Yacht Club, 76 NY2d 256, 269-270 (1990). The court finds that the language “load water-line” used in the Deed is not ambiguous and includes all loaded ballast. This was the case when the Deed was established and remains the case now. The Panel discusses and summarizes the evidence submitted by the parties. ln 1887 when the Deed was established (and to this day), the load line mark ... was a safety measure to ensure ships were not overloaded .... When thee ship was loaded in calm water with cargo, consumables, stores and crew, this load line mark was not permitted to be immersed . . . The same method was used at that time to determine, when required, the length at the water-line of sailing vessels used for racing. The Panel notes further that the concept of measuring load water-line "is not used in relation to racing sailing boats in modern times, other than in Deed of Gift America's Cup challenges," and that in 1988, in the last Deed of Challenge America's Cup race, the measurement rules included ballast. The Panel goes on to conclude that the fact that the ballast will be movable in the upcoming challenge, although of first impression in the history of the America's Cup, does not compel a different result. The court agrees. As for the ACVL rules, they do not apply because they do not provide for measurement of a vessel's length on load water-line. The absence of an AWL rule on the topic of measuring load water-line does not support SNG's claim that the ACVL rules do not include ballast in such a measurement.

ISSUE 2: The safety of holding the race off the coast of Valencia in February, 2010 Panel Opinion: At the hearing, both parties agreed that with the proper application of the RRS, races held in Valencia can be safely managed. The Panel concurs with this assessment. On November 10, 2009, SNG issued the Notice of Race identifying the venue for the 33rd America's Cup race as Valencia, Spain. This issue is now moot.

ISSUE 3: When the Notice of Race (NOR) and other rules of the race are customarily issued in an America’s Cup challenge, including whether they are changed after the Notice of Challenge.

Panel Opinion:

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36. It is the Panel’s opinion that although the RRS [ISAF Racing Rules of Sailing] permit a NOR to be changed after publication provided that adequate notice is given, if a boat is prejudiced by this action the boat may request redress from the Jury under the RRS. 37. Sailing instructions (which give more detailed information about running the races) are required to be made available to each boat before a race begins (RRS 25). In 1988 (the last Deed of Gift challenge) Sailing instructions (together with the NOR [Notice of Race]) were issued by the Defender 16 days before the first race.

38. At the hearing SNG indicated that it would issue the NOR as soon aa it determines the venue.

SNG has issued the Notice of Race three months before the February 10th date scheduled for the America’s Cup race. This time period exceeds the examples of time periods discussed by the Panel in its opinion. The issue of timing for the initial NOR is therefore moot. As for the time of changes to the NOR, the Panel found that the defender (here SNG) may change the NOR after it is issued as long as adequate notice is provided. The Panel bases this decision in part on the challenging boat’s right under the RRS to seek redress from the America’s Cup Jury for any prejudice resulting from the change. GGYC argues that the agreement between SNG and the ISAF prevents the sailing Jury from modifying the NOR, which in turn abrogates the GGYC’s right to seek redress from the Jury for any prejudicial changes to the NOR. SNG argues that the issue is moot because the ISAF has confirmed that it will appoint an independent International Jury and that the process will be completed shortly. SNG also argues that issues relating to the contents of the Notice of Race do not fall within the Deed of Gift and therefore are not properly subject to review by the New York courts.

The court is charged with construing the intent of the settIor from the language of the Deed of Gift. The Deed provides, in relevant part, [These ocean courses] shall be selected by the Club holding the Cup; and these races shall be sailed subject to its rules und sailing regulations so far as the same do not conflict with the provisions of this deed of gift, but without any time allowances whatever.

(Emphasis added.)

GOYC has challenged SNG’s changes to its rules as contrary to the Deed. Issuance of an NOR is mandated by the RRS and not by the Deed. The contents of, and changes to the NOR are reviewable by the Jury pursuant to the RRS, but they also are reviewable by the court to determine if they conflict with the Deed. The Deed is silent on the issues of whether, and when, the defending club may change its rules. The court finds that the RRS fill this void, providing the mechanism for review by the Jury in the event the NOR or any changes to it are prejudicial to the challenging club. The same is true for issuance of sailing instructions, which must be issued by the defending club prior to the match.

This would normally end the inquiry, but GGYC has alleged that SNG and the ISAF have agreed to bypass this administrative review process. The court, however, need not determine whether this agreement violates the Deed, or whether the court is empowered to review the propriety of the agreement under the RRS. The ISM, in an amicus submission, has confirmed that it will appoint an independent and objective Panel of jurors, free from interference by SNG. SNG also claimed that its letter to the ISAF dated September 16, 2009, amended parts of is agreement with ISAF and shows that it does not intend to restrict ISM from exercising its power of appointment of an independent Jury, or to modify the International Jury’s powers (by blocking its review of changes to the NOR). The Panel issued the following recommendation’ which the court adopts: The Panel recommends that the parties be directed to attempt to reach a binding agreement to reflect the submissions referred to above. Should they fail to agree in such time as the Court determines, the matter be referred to the Panel which would confer with the Parties and advise the Court on how the matters contained in the submissions be resolved.

ISSUE 4: When the Panel of jurors is customarily appointed in an America’s Cup challenge.

Panel Opinion: 41. There is no rule that governs when a jury should be appointed. In mast major sailing events, the appointment of the jury usually occurs after the Notice of Race has been published. In the case of the America’s Cup the appointment of a jury is often prompted by the development of a potential dispute.

42. At the hearing, both parties agreed that the ISAF may appoint a jury at any time, without either party requesting the appointment, and were happy for ISM to appoint the jury now.

This issue is now moot since the ISM has indicated it will appoint a Jury shortly.

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ISSUE 5: Whether the contract between ISAF and SNG provides for an independent and objective Panel of jurors, and by which rules such a Panel of jurors is bound in an America’s Cup challenge.

Panel Opinion: 47. SNG, as Trustee of the America’s Cup has an obligation to ensure there is no conflict between the provisions of ISAF RRS and ISAF regulations and the Deed of Gift. In the Panel’s opinion, SNG has properly reserved for itself the exclusive authority to resolve any such conflict including the right to modify the relevant documentation. SNG, as the Organizing Authority, is the party responsible for preparing and issuing the documentation for the Event.

48. The Panel is of the opinion that clause 7 of the Agreement relates to ‘conflict of rules’ and would not prevent the Jury from granting redress by way of modifying the relevant documentation in appropriate cases.

The Panel identified the rules by which the International Jury would be bound as the ISAF Racing Rules and Regulations. The Panel further recommended that the parties be directed to attempt to reach a binding agreement reflecting the parties’ submissions to the Panel and establishing that SNG “has no intention of altering the normal rules of the RRS in respect of a jury including right and powers concerning redress....’’ (See also the discussion ante re: Issue 3.) Accordingly, it is ORDERED that GGYC’s motion to renew and for other relief is granted in part to the extent of striking SNG’s measurement rule excluding movable ballast; and it is further ORDERED, in accordance with the Panel’s Opinion and this Decision and Order, that the parties shall attempt to reach a binding agreement regarding SNWs declared intent not to binder ISM’s appointment of an independent and objective International Jury.

The parties shall report to the court in writing by December 4, 2009, on their success or failure to reach an agreement, and any further dispute on this issue will be referred back to the Expert Panel for recommendations; and it is further ORDERED that in all other respects the motion to renew is denied; and it is further ORDERED that GGYC’s motion to enforce the April 7, 2007 Order and Judgment regarding venue for the race (Cahn, J., Retired) is denied as moot.

Date: November 17, 2009 New York, NY

New York Supreme Court Decision and Order regarding RAK Venue of the 33rd America’s Cup – 27 October 2009 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK : IAS PART 54 GOLDEN GATE YACHT CLUB, Plaintiff, -againstSOCIETE NAUTIQUE DE GENEVE, Defendant, -againstCLUB NAUTICO ESPANOL DE VELA, Intervenor/Defendant.

October 27, 2009 60 Centre Street New York, New York BEFORE: HON. SHIRLEY KORNREICH, Justice APPEARANCES:

INDEX No. 602446/07

BOIES, SCHILLER & FLEXNER LLP Attorneys for Plaintiff 575 Lexington Avenue New York, New York 10022 BY: DAVID BOIES, ESQ., of counsel

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PHILIP M. BOWMAN, ESQ., of counsel JOHN F. LASALLE, Ill, ESQ., of counsel SIMPSON THACHER & BARTLETT LLP Attorneys for Defendant 1425 Lexington Avenue New York, New York 10017 BY: BARRY R. OSTRAGER, ESQ., of counsel JONATHAN K. YOUNGWOOD, ESQ, of counsel THOMAS J. WELLING, JR., ESQ., of counsel CLEARY GOITLIEB STEEN & HAMILTON LLP Amici for Ras Al Khaimah One Liberty Plaza New York, New York 10006 BY: JEFREY A. ROSENTHAL, ESQ., of counsel JONATHAN 1. BLACKMAN, ESQ., of counsel JACOB, MEDINGER & FINNEGAN, LLP Attorneys for International Sailing Federation 1270 Avenue of the Americas New York, New York 10020 BY: PETER A. CROSS, ESQ., of counsel

[omissis] "THE COURT: I’m ready to render a decision on this one motion, and I feel it necessary to do so from the bench because of the time constraints.

Again, I'm not - I’m going to render this decision purely on legal grounds.

I believe that the order of Justice Cahn, as affirmed by the Court of Appeals, permits the race to take place in Valencia, Spain, and this was by virtue of previous preparation that took place in Valencia, Spain, there had been mutual agreement prior to the order that it would take place in Valencia, Spain, and I believe that may well be the reason Valencia, Spain was mentioned.

by SNG."

Whether it is or not, Valencia, Spain was permitted, and it is a Northern Hemisphere venue, it was permitted for the race.

Other than that, the judge specifically said - and, again, this order was affirmed by the Court of Appeals " -or any other location selected

It is the belief of this Court that that phrase must be read in conjunction with the Deed of Trust, and the Deed of Trust specifically requires that the race, if it takes place between November 1 and May 1, must take place in the Southern Hemisphere.

Therefore, since RAK is in the Northern Hemisphere, it cannot under the Deed of Trust take place in RAK. The Court, however - the Court will not comment and does not believe it is appropriate for me to comment, or need J comment at this point, about security and safety.

The Court does, however, want to state for the record that it feels again that what occurred here was unsportsmanlike on the part of GGYC. I believe that there were tactics employed that should not have been employed in an un-sportsmanlike fashion if there really was going to be good sportsmanship.

However, that is not - this is not the forum for deciding whether or not GGYC acted in a sportsmanlike manner, this is only a legal forum, and if it' s going to be taken up, should be taken up somewhere else.

Again, although not specifically addressed, what I do want to state, and l'm stating this because in the future it may come up, the Deed of Trust requires, quote, "friendly competition among foreign nations."

Now, in keeping with this requirement, I believe that any venue- in keeping with this requirement, and also in keeping with the laws of New York and of the United States against discrimination, any venue that is selected must be a venue that permits spectators and competitors from any nation and any religion to take part.

I' m just stating that for the record, because that would be an issue were any nation or any religions barred from taking part, both as a spectator and as a competitor in any race, in any nation.

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This is a Deed of Trust under New York and United States law, and there is no discrimination under our laws.

With that, this is my opinion and my Order. "

[omissis]

SETTLEMENT AGREEMENT and MUTUAL RELEASE (26 MARCH 2010) The Settlement Agreement of all claims and counterclaims on the 31st 32nd and 33rd America’s Cup. Interestingly, this includes an order for SNG to return the damaged pieces of the Cup that had been replaced by Garrard (London) after the New Zealand sledgehammer attack, and had been found on an auction site by Alinghi. (see also America’s Cup Compendium – The Cups)

SETTLEMENT AGREEMENT AND MUTUAL RELEASE

FOR SETTLEMENT PURPOSES ONL Y SUBJECT TO N.Y. CPLR §4547

This Settlement Agreement and Mutual Release (the "Agreement"), dated as of March 26, 2010 is entered into by and among the following parties (the "Parties"): (1) Golden Gate Yacht Club ("GGYC") and Oracle Racing Inc. ("Oracle Racing") (collectively, the "GGYC Parties") and (2) Société Nautique de Genève ("SNG"), Team Alinghi SA ("Alinghi"), and AC Management SA (collectively, the "SNG Parties").

WHEREAS, on July 20, 2007, GGYC filed a Verified Complaint against SNG in the Supreme Court of the State of New York, County of New York, entitled Golden Gate Yacht Club v. Société Nautique de Genève, Index No. 602446/2007 (the " July 2007 Action"); WHEREAS, on October 26, 2009, GGYC filed a Summons and Complaint against SNG in the cause of action entitled Golden. Gate Yacht Club v. Société Nautique de Genève, seeking relief for an alleged breach of fiduciary duty by SNG (the "October 2009 Action"); WHEREAS, on February 12 and 14, 2010, the Parties competed in the 33rd America's Cup, which was won by GGYC; WHEREAS, following the conclusion of the 33rd America's Cup, the Parties agree that it is in the best interest of the America's Cup and the sport to discontinue all litigation between them; NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, the Parties agree as follows: 1.

2.

3.

4.

5.

Transfer of the America's Cup. On February 14, SNG transferred the America's Cup to GGYC. Within 10 days of the execution of this Agreement, SNG shall transfer to GGYC the pieces of the damaged Cup that SNG recovered in 2006 from different individuals in New Zealand. GGYC shall execute the Assignment and Acceptance Agreement annexed hereto as Exhibit A. Transfer of ACPI. Within 7 days of the execution of this Agreement, GGYC shall execute the Undertaking annexed hereto as Exhibit B, and SNG shall (a) cancel the certificate 6 of shares for America's Cup Properties, Inc. ("ACPI"), (b) issue and transfer a certificate 7 of shares for ACPI in the name of GGYC, (c) direct the resignation of all current directors of ACPI, and (d) direct the transfer to GGYC of the corporate records and intellectual property of ACPI, including trademarks and the domain name americascup.com.

The Cup Heritage Trustee Limited. Within 10 days of the execution of this Agreement, SNG shall (a) direct the resignation of Hamish Ross as director of The Cup Heritage Trustee Limited ("CHTL"), (b) direct the trans fer of shares of the CHTL to the transferee designated by GGYC, and (c) direct the transfer to GGYC of the corporate records.

Transfer of Equipment. Within 21 days of the execution of this Agreement, SNG shall transfer to GGYC the race equipment listed in Exhibit C to this Agreement, plus any other equipment not on Schedule C that was transferred to SNG or America's Cup Management by Challenger of Record Management following the 31st America's Cup in New Zealand, subject to normal depreciation and use of such equipment. The equipment shall be available in one or several containers, ready for shipping at the race operation center in Valencia, Spain.

Dismissal of Pending Litigation. Within 10 days of execution of this Agreement, GGYC and SNG shall file a Joint Stipulation of Discontinuance with the Supreme Court of the State of New York ceasing and dismissing without prejudice all pending litigation against each other, with each party bearing its own attorneys' fees and costs. The dismissal of pending litigation without prejudice, as opposed to with prejudice, shall not be deemed to limit, in any way, the scope or effect of the Mutual Release in Paragraph 6 hereto or the Covenant Not to Sue in Paragraph 7 hereto. This Agreement shall be filed as an Exhibit to the Joint Stipulation of Discontinuance.

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6.

7.

8.

9.

10.

11.

12.

13.

14.

15.

Mutual Release. The GGYC Parties and the SNG Parties, in all of their respective capacities and to the fullest extent permitted by law, hereby release and discharge each other, their predecessors in interest, successors in interest, present and former affiliates, parents, shareholders, and subsidiaries, and all of their present and former agents, representatives, officers, directors, members, employees, principals, insurers, partners, shareholders, successors and assigns (collectively, the "Released Parties"), from all claims, causes of action, litigation, legal actions, or lawsuits of any kind or nature relating to or arising out of the 31st, 32nd or 33rd America's Cups that they ever had, now have or hereafter may have against each other from the beginning of the world to the date of this Agreement, including, without limitation, the July 2007 Action and the October 2009 Action.

Covenant Not to Sue. The GGYC Parties and the SNG Parties, in all of their respective capacities and to the fullest extent permitted by law, each hereby covenant not to bring or continue any litigation, fund the litigation or commencement of any litigation, or willfully assist in an effort to further any litigation against the Released Parties relating to or arising out of the 31st, 32nd or 33rd America's Cups before any court, arbitrator or other tribunal, including, but not limited to, the International Sailing Federation and any sports tribunal, in any jurisdiction, whether as a claim, cross-claim or counterclaim, with the exception of any action to enforce this Agreement.

Severability. In the event any of the provisions of this Agreement are deemed to be invalid and unenforceable, those provisions shall be severed from the remainder of this Agreement only if and to the extent agreed upon by the Parties.

Entire Agreement. The Parties agree and acknowledge that this Agreement constitutes the entire agreement among the Parties regarding the settlement and release of the matters specified herein and that this Agreement may not be altered, amended, modified, or otherwise changed in any respect whatsoever except by a duly executed writing by or on behalf of all of the Parties.

Authority. The Parties each warrant and represent that he, she or it has read this Agreement, bas the necessary authority to execute the Settlement Agreement individually and on behalf of his, her or its respective principals, if any, and has duly authorized his, her or its counsel to execute the Agreement on his, her or its behalf and on behalf of his, her or its respective principals.

Governing Law. This Settlement Agreement, in all respects, shall be interpreted, enforced and governed by and under the laws of the State of New York, except New York's conflict of law or choice of law provisions.

Construction. This Agreement is not to be construed in favor of any particular party to the Agreement, but is to be construed as if drafted by all Parties to the Agreement.

Costs and Expenses. Each Party shall bear its own costs and expenses incurred in connection with the 33rd America's Cup, including in connection with any litigation and the negotiation, drafting, and consummation of this Agreement.

Execution in Counterparts. The Parties agree that this Agreement may be executed in one or more counterparts, and in both original form and one or more photocopies, each of which shall be deemed to be an original, but all of which shall be deemed to be and constitute one and the same instrument. Signatures necessary for the execution of this Settlement Agreement may be transmitted by electronic mail, telecopier or facsimile machine.

Notices and Communications. Any notices or communications under this Settlement Agreement shall be given to the Parties, by hand delivery or overnight mail, and also by email, as follows: If to the GGYC Parties:

The Golden Gate Yacht Club # 1 Yacht Raad San Francisco, CA 94123 USA Attn: Melinda Erkelens (mcrkelens@ bmworacleracing.com) Marcus Young (commodore@ggyc.com) with a copy to: Boies, Schiller & Flexner LLP 575 Lexington Avenue New York, New York 10022 Attn: David Boies (dboies@bsfllp.com) Philip Bowman (pbowman@bsfllp.com) If to the SNG Parties: To: Société Nautique de Genève Port Noir CH-1223 Cologny Switzerland Attn: Lucien Masmejan (lucien. masmejan@ lenzstaehelin .com) Fred Meyer (fred.meyer@bluewin.ch) with a copy to: Sullivan & Cromwell LLP

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125 Broad Street New York, NY 10004 Attn: Robert J. Giuffra, Jr. (giuffrar@sullcrom.com) Sharon L. Nelles (nelless@sullcrom.com) IN WITNESS WHEREOF, the Parties have caused this Settlement Agreement to be executed on their own behalf and through their respective counsel as of the date(s) set forth below.

Date: March 26, 2010 By: ____________________ Marcus Young Golden Gate Yacht Club Date: March 26, 2010 By: ____________________ Melinda Erkelens Oracle Racing Inc. Date: March 26, 2010 By: ____________________ Pierre-Yves Firmenich Fred Meyer Société Nautique de Genève Date: March 26, 2010 By: ____________________ Lucien Masmejan Susana Villalain Team Alinghi SA Date: March 26, 2010 By: ____________________ Lucien Masmejan Susana Villalain AC Management SA

Case 13: JUDGMENT OF THE SUPREME COURT OF THE STATE OF NEW YORK DATED SEPTEMBER 20, 1984 An application having been made by the petitioner The Royal Perth Yacht Club of Western Australia Incorporated for an order interpreting certain provisions of a Deed of Gift of the America’s Cup dated October 24, 1887 between George L. Schuyler and The New York Yacht Club, as amended by order of the Court dated December 17, 1956 (index No. 12696/56); NOW, upon reading and filing the order to show cause dated August 8, 1984 (Alfred M. Ascione, Jr., J.) with proof of due and timely service of the Attorney General of the State of New York, the petition of the Royal Perth Yacht Club of Western Australia incorporated, verified the 30th day of July 1984, and annexed exhibits, and the affidavit of Eugene M. Kinney, sworn to the 20th day of July, 1984 and exhibits thereof, all in support of the petition, and the notice of appearance and consent of Attorney General of the State of New York, acknowledged the 13th day of August, 1984, consenting to the petition; AND, a memorandum decision and order dated September 4, 1984, having been rendered granting the petition; NOW, upon the motion of DeForest & Duer, attorneys for the petitioner The Royal Perth Yacht Club of Western Australia Incorporated, it is ORDERED and ADJUDGED, that the petition of The Royal Perth Yacht Club of Western Australia Incorporated is granted with the consent of the Attorney General of the State of New York, representative of the public interest in the Deed of Gift, to the extent of declaring that the Deed of Gift entitles the Chicago Yacht Club, a yacht club of a foreign (i.e. competing) country as contemplated in the Deed of Gift, to enroll and compete as a contestant for the "America’s Cup."

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Case 14: AFRICAN DIASPORA MAR. CORP. v. GOLDEN GATE YACHT CLUB 38 Misc. 3d 1214 (N.Y. Sup. Ct. 2013) In this case, the Plaintiff, African Diaspora Maritime Corporation, accused the Golden Gate Yacht Club, the then-holder of America’s Cup, of unfairly rejecting them as a contender for the 34th Defense of the America’s Cup. GGYC defended the claims asserting that ADM had never completed the application process and nevertheless did not possess the financial, technical and/or human resources and experience to have a reasonable chance of winning the Cup. ADM claimed breach of contract, breach of trust and breach of fiduciary duty.

ADM action was dismissed by Judge Barbara R. Kapnic, on 18 January 2013.

Supreme Court, New York County AFRICAN DIASPORA MARITIME CORPORATION, Plaintiff, -againstGOLDEN GATE YACHT CLUB, Defendant 653419/11 Plaintiff was represented by Banks Brown and Andrew B. Kratenstein, Esqs., McDERMOTT WILL & EMERY LLP, 340 Madison Avenue, New York, New York 10173, Tel. 212-547-5400.

Defendant was represented by Philip M. Bowman, Esq., BOIES, SCHILLER & FLEXNER LLP, 575 Lexington Avenue, New York, New York 10022, Tel. 212-446-2300.

BARBARA R. KAPNICK, J.: This action involves the America's Cup race - the premier sailing competition in the world - and plaintiff African Diaspora Maritime Corporation's ("ADM") rejected application to compete to be a Defender of the Cup in the 34th America's Cup ("AC 34") to take place in San Francisco in 2013. The current trustee of the Cup is defendant Golden Gate Yacht Club ("GGYC").

Background Plaintiff ADM is a not-for-profit corporation founded by Charles M. Kithcart in 1994, and incorporated under the laws of North Carolina in 2011 for the purposes of competing in local, national, and international competitive sailing events and maritime activities - including but not limited to the America's Cup - and training and mentoring young African-Americans regarding competitive race sailing and maritime history. (Amended Complaint, ¶¶ 6, 30) Defendant GGYC, represented by Team Oracle Racing, won the 33rd America's Cup race ("AC33") in Valencia, Spain on February 14, 2010. (Id., ¶¶ 10, 22.) On April 20, 2010, GGYC accepted the America's Cup trophy from the former trustee of the Cup, Société Nautique de Genève ("SNG"). This transfer occurred pursuant to a signed "Assignment and Acceptance" entered into by GGYC and under which GGYC agreed to accept the Cup and hold it in trust in accordance with the terms and conditions as stated in the Deed of Gift, described below. (Id., ¶ 11.)

The Cup, a large silver trophy first won by the schooner yacht "America," in a race against British sailing vessels around the Isle of Wight in England in 1851, "became the corpus of a charitable trust created under the laws of New York ..." (Golden Gate Yacht Club v Société Nautique de Genève, 12 NY3d 248, 252 [2009]). In 1887, the owner of the Cup created a deed of gift (the "Deed of Gift"), pursuant to which the Cup "shall be preserved as a perpetual Challenge Cup for friendly competition between foreign countries."

Under the Deed of Gift, an established yacht club of a country other than the home country of the club holding the Cup may seek to challenge the club that holds the Cup. Such clubs are known as "Challengers." Additionally, under the Protocol described below, anyone seeking to put together a racing team from the home country of the Cup holder can apply to GGYC to represent GGYC in AC34. Such teams are known as "Defender Candidates," since they would be applying to defend GGYC's possession of the Cup. (Amended Complaint, ¶ 26.) The team that ultimately represents GGYC in AC34 will be known as the "Defender." Under the

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Protocol, if there is more than one team seeking to be the Defender of the Cup, the contestants will participate in preliminary races as a means to decide who will be the Defender. (Id.) On or about February 15, 2010, the day after GGYC won AC33, GGYC announced it had accepted a challenge to sail a new match from Club Nautico di Roma ("CNR") as "Challenger of Record" in the AC34 races.[FN1] Under the Deed of Gift, CNR as Challenger of Record, was empowered to negotiate with GGYC, if GGYC so desired, a "protocol" to govern AC34. Specifically, the Deed of Gift provides that "[t]he Club challenging for the Cup and the Club holding the same may, by mutual consent, make any arrangement satisfactory to both as to the dates, courses, number of trials, rules and sailing regulations, and any and all other conditions of the match, in which case also the ten months' notice [otherwise provided by the Deed of Gift] may be waived." (Amended Complaint, ¶ 23.)

GGYC and CNR reached agreement and, on September 13, 2010, published the Protocol Governing the 34th America's Cup (the "Protocol". The Protocol establishes, inter alia, who from the United States can challenge its representative from AC33 - Team Oracle Racing - to be the "Defender of the Cup" and serve as the of GGYC, as trustee and current holder of the Cup. (Id., ¶¶ 20, 24).

Article 3 of the Protocol defines GGYC's duties when dealing with both Defender Candidates and candidates to be Challengers, and states in pertinent part that GGYC, in its capacity as trustee, shall "act in the best interests of all Competitors collectively" and "not unreasonably favor the interests of any Competitor over another." Under the Protocol's definitions, a "Competitor" includes both a "Defender Candidate" and a "Challenger." (Id., ¶ 27.)

Articles 8 and 26 of the Protocol establish a procedure to apply to become a Defender Candidate and, if accepted, to challenge Team Oracle Racing in an America's Cup Defender Series to determine who will represent GGYC in AC34. In particular, Article 8 sets forth the procedure for a racing team to follow in order to be considered by GGYC to become a Defender Candidate and the standards GGYC must apply in such consideration, all subject to GGYC's duties in holding the Cup "as trustee for the benefit of all potential challengers". Specifically, Article 8 of the Protocol provides as follows: 8. ACCEPTANCE OF DEFENDER CANDIDATES 8.1 GGYC will accept applications to be a Defender Candidate from 1 November 2010 until 31 March 2011. Thereafter, applications may be accepted at the discretion of GGYC upon payment of a late fee to be determined by GGYC. 8.2 Defender Candidates shall comply with the Protocol and shall submit the documents and fees as set out in Article 9.

8.3 GGYC will review Defender Candidate applications and will accept those it is satisfied have the necessary resources (including but not limited to financial, human, and technological) and experience to have a reasonable chance of winning the America's Cup Defender Series. (emphasis added).

(Amended Complaint, ¶ 28).

Article 9 of the Protocol requires Defender Candidates to submit an application, an example of which was appended to the Protocol as Schedule Two, and submit a bank draft in the sum of $25,000 made payable to "America's Cup Properties, Inc." (Amended Complaint, ¶ 29.) Further, Article 5 of the Protocol establishes a "Competitor Forum," which the "Regatta Director shall establish and maintain ... for consultation and communication with Competitors." The Competitor Forum was the vehicle that GGYC used to communicate information necessary for potential Competitors to include in their applications as well as any other information concerning their participation in AC34. (Id., ¶ 32.)

While GGYC was negotiating the Protocol, it was also negotiating with the City of San Francisco with the aim of selecting San Francisco as the host city for AC34. On or about December 31, 2010, GGYC did officially select San Francisco to host AC34. (Id., ¶ 25.)

On or about July 7, 2010, ADM claims that it contacted GGYC to congratulate it on its victory in AC33 and to seek advice on how to apply to be a Defender Candidate in AC34. GGYC purportedly directed ADM to contact Tom Ehman ("Ehman"), the Chairman of the America's Cup Committee. (Id., ¶ 33.) ADM asserts that, at that time, Ehman was aware that GGYC had already formed the Competitor Forum and that Anthony Romano ("Romano") was its liaison. Rather than immediately putting ADM in touch with Romano, however, between July 8, 2010 and March 26, 2011, while ADM contacted GGYC (through Ehman) on a near-monthly basis seeking information on how to join AC34 and asking to speak with someone about ADM's intent to participate, ADM alleges that

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GGYC continued to exhibit a pattern of intentional avoidance, providing it with virtually no information until it was nearly too late for ADM to enter AC34. (Id., ¶¶ 34-35.)

Further, ADM alleges that on or about March 26, 2011, just five days before the entry deadline for AC34, GGYC finally forwarded ADM to Romano. Between March 26 and March 31, 2011, Romano forwarded information critical to ADM's application to join AC34, which purportedly had been provided to the Competitor Forum months prior. (Id., ¶ 38.)

In spite of the foregoing delays, on or about March 31, 2011, ADM claims that it timely submitted a fully compliant application ("Application") under the Protocol to sail a match to become the rightful Defender of the America's Cup. In addition, it wired the $25,000 application fee to the designated account. (Id., ¶¶ 39, 43-44.)

ADM's team was to include, among others, three Olympians, an All-American, several additional talented, experienced and awardwinning sailors, and Dave Pedrick ("Pedrick"), an America's Cup award-winning yacht designer. (Id., ¶ 40.)

Additionally, ADM contends GGYC was well aware that ADM had detailed plans underway to create a "media frenzy" around its team for both publicity and fundraising purposes. For example, conditioned upon GGYC accepting ADM as a Defender Candidate, ADM, together with the Secretary of Commerce and the Head of the Department of Tourism for North Carolina, developed a plan to build a "boat park" in Raleigh. Also conditioned on GGYC accepting ADM, several wealthy African-Americans had committed to help ADM fund its efforts to win AC34. (Id., ¶¶ 41-42.)

ADM alleges that from about April 1 - April 15, 2011, GGYC falsely and repeatedly claimed that its Application was deficient because it was not signed and did not include a document evidencing payment of the $25,000 fee. However, ADM asserts that it later disproved these claims. (Id., ¶¶ 46-47.)

Then, GGYC contacted Pedrick, who ADM had listed on its Application as the Design Director for ADM's yacht. Pedrick purportedly confirmed to GGYC that he would in fact be ADM's yacht designer if ADM were selected by GGYC. However, ADM alleges that because Pedrick had not signed a contract with ADM to this effect, GGYC told ADM its team was not constituted as claimed in the Application and that Pedrick had "denied" being a member of the ADM team. Notwithstanding GGYC's position, ADM argues that emails from Pedrick to ADM, as well as an April 5, 2011 email from Pedrick to GGYC, establish that Pedrick did, in fact, intend to design a yacht for ADM in its effort to win AC34. (Id., ¶ 47.)

Finally, by letter dated April 15, 2011, GGYC advised ADM that its Application had been rejected. GGYC's stated reason for the rejection was that it was "not satisfied that ADM has, or will have the necessary resources (including but not limited to financial, human, and technological) and experience to have a reasonable chance of winning the America's Cup Defender Series." (Id., ¶ 48.)

ADM insists GGYC had no basis for its claimed lack of "satisfaction" because even though ADM's Application indicated that it would "provide further details of our challenge as GGYC may request to review and consider this application," GGYC never attempted to verify the precise status of its proposed team, never attempted to obtain any information about whether ADM might be able to raise the necessary funds, and never attempted to ascertain whether ADM's proposed team had the necessary "experience" to have a "reasonable chance" of beating Team Oracle Racing. (Id., ¶ 49.) [*6] Moreover, ADM argues that GGYC knew well that potential Competitors are most often without funds prior to being accepted as Competitors, because it is the status of Competitor that gives a Competitor the ability to begin raising funds. (Id., ¶ 50.)

Plaintiff claims that GGYC provided material or financial help to other struggling Competitors, by buying or giving them a yacht and/or a design package for use in AC34. In so doing, plaintiff claims GGYC was using its powers as trustee of the America's Cup to help some Competitors and not others, and thus failing to treat all equally. (Id., ¶ 53.)

ADM filed its original Summons and Complaint on or about December 12, 2011. GGYC then moved to dismiss the Complaint on January 17, 2012. By Stipulation dated April 19, 2012, the parties agreed to allow plaintiff to file and serve an Amended Complaint

by April 20, 2012, which was done, and the first motion to dismiss was deemed moot by the Court. The Amended Complaint, dated April 20, 2012, asserts causes of action for: (i) breach of contract (Count One); (ii) breach of trust (Count Two); and (iii) breach of fiduciary duty by self-dealing (Count Three).

The first cause of action, sounding in breach of contract, alleges that GGYC agreed in the Protocol to review all compliant applications of sailing teams seeking to be a Defender Candidate, and to accept those that it was satisfied had the necessary resources and experience to have a reasonable chance of winning the America's Cup Defender Series. ADM argues that GGYC breached its duty to undertake a good faith review of ADM's application.

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The second cause of action, sounding in breach of trust, alleges that in considering ADM's application, GGYC owed ADM a fiduciary duty as trustee of the Cup to consider only relevant factors and ignore any irrelevant factors, and to consider such factors with due care and after necessary inquiry and investigation, and in light of the realities of the financing of a challenge as it did with other Competitors. ADM alleges that GGYC breached those duties, and that it has been damaged to the extent that it is unable to participate in the America's Cup regatta or any of the events leading up to it, and its preparations to compete have been substantially impaired and delayed.

The third cause of action, denoted, "breach of fiduciary duty by self-dealing," alleges that GGYC engaged in self-dealing by negotiating to purchase long-term property rights in waterfront property on San Francisco Bay that could be assigned to third parties free of the trust imposed by the Deed, and also by requiring that all competitors purchase AC 45 yachts to the benefit of Team Oracle Racing and its member, Larry Ellison.

ADM seeks $1 million in compensatory damages and numerous forms of equitable relief, including, but not limited to: an order directing GGYC to accept its Application, hold an America's Cup Defender Series, and reschedule and postpone any currently scheduled America's Cup events to allow for ADM to design, build and test a racing vessel; the removal of GGYC as trustee of the Cup and the appointment of an independent trustee; and that GGYC provide ADM with at least two AC 45 yachts and provide equal vessels to all Competitors and potential Competitors.

GGYC now moves to dismiss the Amended Complaint on the grounds that (1) there is a defense founded upon documentary evidence (CPLR 3211 [a] [1]); (2) the Complaint fails to state a cause of action (CPLR 3211 [a] [7]); and (3) plaintiff lacks standing (CPLR 3211 [a] [3]) to assert the breach of trust and breach of fiduciary duty causes of action.

Discussion It is well settled that [o]n a motion to dismiss pursuant to CPLR 3211, the pleading is to be afforded a liberal construction. We accept the facts as alleged in the complaint as true, accord plaintiffs the benefit of every possible favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory. Under CPLR 3211(a)(1), a dismissal is warranted only if the documentary evidence submitted conclusively establishes a defense to the asserted claims as a matter of law. In assessing a motion under CPLR 3211(a)(7), however, a court may freely consider affidavits submitted by the plaintiff to remedy any defects in the complaint and the criterion is whether the proponent of the pleading has a cause of action, not whether he has stated one.

Leon v. Martinez, 84 NY2d 83, 87-88 [1994][internal citations and quotation marks omitted]). Allegations consisting of bare legal conclusions, with no factual specificity, however, "are insufficient to survive a motion to dismiss." Godfrey v. Spano, 13 NY3d 358, 373 (2009)(citing Caniglia v. Chicago Tribune-N.Y. News Syndicate, 204 AD2d 233, 233-34 [1st Dep't 1994]).

Breach of Contract Plaintiff alleges in its first cause of action that "the Protocol together with the submitted Application and required fee constituted a binding and enforceable contract between ADM and GGYC."[FN2] (Amended Complaint, ¶ 108). Plaintiff also alleges that GGYC's duties under Article 8.3 of the Protocol - that is, to review Defender Candidate Applications and to "accept those it is satisfied have the necessary resources (including but not limited to financial, human, and technological) and experience to have a reasonable chance of winning the America's Cup Defender Series" - is subject to a reasonableness standard, and at the very least requires good faith on the part of GGYC in determining whether it was satisfied. (Id., ¶ 104). Specifically, plaintiff maintains that GGYC breached the parties' contract by failing to act in good faith, because it lacked a reasonable basis for its claimed lack of "satisfaction" and was wrong not to request additional information from ADM. Defendant, on the other hand, argues that the Protocol was merely a binding agreement with the Challenger of Record setting forth the terms of the next Challenge, as contemplated in the Deed of Gift. At best, defendant insists that the terms of the Protocol governing the procedure for submitting Defender Candidate applications might be considered a solicitation of bids from Defender applicants, which, pursuant to New York law, is simply a request for an offer and not an offer itself. See S.S.I. Invs. v. Korea Tungsten Min. Co., 80 AD2d 155, 158 (1st Dep't 1981), aff'd 55 NY2d 934 (1982).

Further, even if ADM's Application and fee constitute a binding contract, defendant argues that dismissal of the breach of contract claim would still be appropriate because plaintiff does not allege any breach under the Protocol. While plaintiff alleges that GGYC's

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satisfaction must be reasonable, defendant asserts that the plain language of the Protocol grants GGYC unfettered discretion to reject applications that it deems unsatisfactory.

Defendant also asserts that ADM cannot rely on the Protocol's "fairness" requirements, because the provisions cited by plaintiff in the Amended Complaint as establishing a duty of "fairness" apply only to Competitors, not Defender Applicants like ADM. In any event, defendant emphasizes that it did consider ADM's application and gave ADM a more than fair opportunity to demonstrate that it had, or could have, the necessary resources to mount a competitive team, but it failed to do so. Because the Amended Complaint fails to allege that GGYC actually was "satisfied" that ADM possessed the necessary resources and experience, defendant argues that this cause of action should be dismissed.

Defendant also points out that it is trying (as it is obligated to do) to successfully defend the America's Cup. Its chosen representative, Team Oracle Racing, is a proven America's Cup winner. Plaintiff, by contrast, has never competed in the America's Cup, nor has it indicated that it has ever competed in any regatta or that the purported members of its "syndicate" have ever even been on a boat together. Against this backdrop, GGYC contends that it is hard to see how its conduct in declining to accept plaintiff's Application could be deemed unreasonable, even if there was a binding contract, which, of course, defendant disputes.

Finally, defendant argues that plaintiff fails to allege any damages resulting from the alleged breach. Even if plaintiff were to prevail on its breach of contract claim, defendant maintains that plaintiff would not necessarily be selected as a Defender Candidate, let alone win the right to represent GGYC in the America's Cup. In opposition to defendant's argument that the language of the Protocol constitutes only a request for an offer and not an offer itself, plaintiff insists that the rules of a contest constitute a contract offer and that a participant's entry into the contest constitutes an acceptance of that offer. See Robertson v. US, 343 US 711, 713 (1952); Sargent v. New York Daily News, L.P., 42 AD3d 491, 493 (2d Dep't 2007); Diop v. Daily News, L.P., 11 Misc 3d 1083(A) (Sup Ct, Bronx Co 2006); Greenwood v. Daily News, L.P., 8 Misc 3d 1002(A)(Sup. Ct., Nassau Co., June 7, 2005).

ADM also argues that the Protocol states that GGYC had to accept applicants whom GGYC was "satisfied" had a "reasonable chance of winning" and that a "satisfaction" clause does not grant unfettered discretion. ADM relies upon Mattei v Hopper, 51 Cal 2d 119 (Cal 1958), in which the written agreement between plaintiff, the purchaser of real estate, and the defendant-seller, required the real estate broker to obtain leases satisfactory to the purchaser prior to the time he was committed to pay the balance of the purchase price and to take title to the defendant's property.

The Court in Mattei held that [w]hile contracts making the duty of performance of one of the parties conditional upon his satisfaction would seem to give him wide latitude in avoiding any obligation and thus present serious consideration problems, such "satisfaction" clauses have been given effect. They have been divided into two primary categories and have been accorded different treatment on that basis. First, in those contracts where the condition calls for satisfaction as to commercial value or quality, operative fitness, or mechanical utility, dissatisfaction cannot be claimed arbitrarily, unreasonably, or capriciously, and the standard of a reasonable person is used in determining whether satisfaction has been received (internal citations omitted).

Mattei at 122-123.

The second line of authorities dealing with "satisfaction" clauses, are those involving "fancy, taste, or judgment. Where the question [of satisfaction] is one of judgment, the promisor's determination that he is not satisfied, when made in good faith, has been held to be a defense to an action on the contract." Id at 123. ADM further relies on J.D. Cousins & Sons, Inc. v Hartford Steam Boiler Inspection and Ins. Co., 341 F3d 149 (2d Cir 2003), in which the Court held that "if the standard is objective, a decision to reject...performance must be reasonable, while if the subjective standard applies, it need only be shown to be honest and in good faith." J.D. Cousins at 153. Because, based on the plain terms of Article 8.3 of the Protocol, GGYC's satisfaction with plaintiff's Application was a subjective determination, the standard that applies here is one of good faith, not reasonableness. Plaintiff further argues that GGYC's failure to request additional information from ADM was further indication of its lack of good faith. However, GGYC was under no obligation to request further information about plaintiff's financial capabilities or sailing credentials in order to make its determination of satisfaction. The Application states that a Defender Applicant agrees to provide further details "as GGYC may request to review and consider this application." (emphasis added). It is clear from the plain meaning of this language that it was within GGYC's discretion whether further inquiries were necessary. As such, the Court finds nothing in the record to support plaintiff's contention that GGYC acted in bad faith in reviewing plaintiff's Application.

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Finally, with regard to the issues of damages, plaintiff contends that it does not have to plead that had its application been accepted, it would have beaten Team Oracle Racing or won the America's Cup. Plaintiff argues that GGYC's depriving it of the opportunity to compete is harm in and of itself.

In order to plead breach of contract, plaintiff must allege "the existence of a contract, the plaintiff's performance under the contract, the defendant's breach of that contract, and resulting damages." JP Morgan Chase v. J.H. Elec. of NY, Inc., 69 AD3d 802, 803 (2d Dep't 2010). "[R]egardless of whether [the contract] is bilateral or unilateral, there must be a manifestation of mutual assent sufficiently definite to assure that the parties are truly in agreement with respect to all material terms" (internal quotation marks and citations omitted). Thome v Alexander & Louisa Calder Found., 70 AD3d 88, 103-104 (1st Dept 2009), lv den 15 NY3d 703 (2010).

Here, there is nothing in the plain language of the Protocol which indicates an intent that GGYC be bound upon the receipt of a Defender Candidate application and the accompanying fee to do more than review said application. Indeed, the acceptance of a Defender Candidate application is dependent upon both GGYC being satisfied with the resources and experience of the applicant, and upon GGYC deciding to hold a Defender Series in the first instance. Thus, Article 8.3 of the Protocol does not constitute an offer that creates a power of acceptance, or that would impose contractual duties on GGYC to accept a Defender Candidate applicant upon the submission of a compliant application and the required fee. See S.S.I. Invs. v Korea Tungsten Min. Co., supra.

Accordingly, the Court finds that plaintiff has failed to state a cause of action for breach of contract and, therefore, this claim must be dismissed.

Breach of Trust Plaintiff alleges in this cause of action that [i]n deciding whether to accept ADM's Application, GGYC had a fiduciary duty as trustee of the America's Cup to only consider relevant factors and ignore any irrelevant factors, and to consider the relevant factors with due care and after necessary inquiry and investigation, and to consider such factors in light of the realities of the financing of an America's Cup challenge as it did so with other Competitors. GGYC failed to do so and as a result, its denial of ADM's Application was a breach of its duties as trustee of the America's Cup. (Amended Complaint, ¶ 113). Plaintiff further alleges that it has been damaged by being unable to participate in AC34 or any events leading up thereto, and its preparations to compete have been substantially impaired and delayed. (Id., ¶ 114).

Defendant argues, in the first instance, that plaintiff lacks standing to bring a breach of trust cause of action. Defendant cites In re Royal Burnham Yacht Club, 1988 WL 1564609 (Sup Ct, NY Co, April 6, 1988), which also involved the America's Cup and in which the Court articulated the general rule that mere beneficiaries of charitable trusts lack standing to sue to interpret or enforce the trust and must instead rely on the New York Attorney General to do so.[FN3] The Court did, however, recognize an exception to this general rule when a party has a "special interest in funds held in trust for a charitable purpose," (see Alco Gravure, Inc. v. Knapp Found., 64 NY2d 458, 465 [1985]), but defendant argues that exception does not apply here.

Next, defendant argues that plaintiff's claim for breach of trust should be dismissed pursuant to CPLR 3211(a)(1) and (a)(7) because the trust, as set forth in the Deed of Gift, does not require GGYC to hold a Defender Series at all, let alone dictate the "relevant" and "irrelevant" factors under which one is to be held.

Plaintiff argues in opposition that it has standing to bring its breach of trust claim because no New York court has held that the America's Cup trust is a charitable trust, citing to a footnote in the Mercury Bay Boating Club case, 76 NY2d at 271 n.4.

Further, plaintiff argues that even if this Court finds the America's Cup Trust to be a charitable trust, the "special interest" exception delineated in Alco Gravure, supra, in which the Court of Appeals held that "special interest" confers standing where "a particular group of people has a special interest in funds held for a charitable purpose, as when they are entitled to a preference in the distribution of such funds and the class of potential beneficiaries is sharply defined and limited in number," applies. Alco Gravure, 74 NY2d at 465. Plaintiff contends that, like in Alco Gravure, merely being a Competitor entitles such parties to a share of the Net Surplus Revenue.

Finally, plaintiff argues that it has stated a claim for breach of trust because under the Deed of Gift and the Protocol, GGYC had a duty to fulfill its obligations as trustee in good faith, honestly, and with undivided loyalty and GGYC failed to do so.

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As noted, the Court of Appeals concluded in Mercury Bay and Golden Gate Yacht Club that the America's Cup was created pursuant to a charitable trust and, thus, this Court finds unavailing plaintiff's arguments to the contrary. Moreover, plaintiff's arguments regarding the special interest exception are insufficient as a matter of law and irrelevant because plaintiff is not a beneficiary of the trust. It is simply an applicant applying to be accepted as a "Defender Candidate," and not a confirmed "Defender Candidate" or "Competitor," as those terms are defined in the Protocol. Accordingly, the Court finds that plaintiff lacks standing to assert its breach of trust cause of action and it is, therefore, dismissed.

Breach of Fiduciary Duty Finally, plaintiff alleges in its third cause of action that GGYC is engaged in self-dealing by negotiating terms directly beneficial to it and other third parties, free from trust, in violation of the terms of the Deed of Gift, the Assignment and Acceptance, the April 20, 2010 Undertaking, and its fiduciary duties of a trustee.

GGYC similarly violated the terms of [same] by requiring that all competitors purchase AC 45 yachts to the benefit of Oracle Racing, and its member, Larry Ellison.

(Amended Complaint, ¶ 117).

Moreover, plaintiff alleges that it has standing to bring its breach of fiduciary duty claim as a "beneficiary of the trust because it is a potential defender ... and has sought to compete to become the Defender," (Amended Complaint, ¶ 116), and because, had GGYC exercised its discretion in good faith, ADM would be a Competitor required to buy an AC 45 and entitled to a share of the Net Surplus Revenue.

Defendant argues that plaintiff lacks standing for the reasons discussed, supra, because it has not and cannot allege any conceivable injury resulting from the alleged breach of fiduciary duty.[FN4] Further, even if plaintiff has standing to bring its breach of fiduciary duty claim, this claim would still fail because the Amended Complaint fails to allege a breach of that duty. See Mercury Bay Boating Club, supra.

For the same reasons stated above, the Court finds plaintiff lacks standing to assert its breach of fiduciary duty claim. The fiduciary duty that GGYC owes as trustee of the America's Cup under the Deed is to use its best efforts to defend its right to hold the Cup and thus to defeat the beneficiaries in the contemplated competition. It is thus inappropriate and inconsistent with the competitive trust purpose to impose upon the trustee of a sporting trust such as this one the strict standard of behavior which governs the conduct of trustees who are obligated not to compete with the trust beneficiaries.

Mercury Bay Boating Club Inc., 76 NY2d at 271.

GGYC also owes a duty construe the Deed in accordance with its plain meaning, and to adhere to the provisions in the Deed (Id.).

Nothing in the Deed extends beneficiary status to mere applicants to become a Defender Candidate, such as ADM. Therefore, this cause of action must also be dismissed.

Accordingly, the motion is granted in its entirety and the Amended Complaint is dismissed with prejudice and without costs or disbursements.

This constitutes the decision and order of this Court.

Date: January 18, 2013 Barbara R. Kapnick J.S.C. Footnotes Footnote 1: CNR has since withdrawn from the impending America's Cup and the current Challenger of Record is the Royal Swedish Yacht Club, represented by Artemis Racing.

Footnote 2: Plaintiff asserts that defendant does not dispute that ADM prepared its Application in the precise form provided by Schedule Two of the Protocol and submitted the fee with its Application.

Footnote 3: The Court of Appeals has previously acknowledged that the America's Cup was created pursuant to a charitable trust.

Golden Gate Yacht Club v. Société Nautique de Genève, 12 NY3d 248, 251 (2009); Mercury Bay Boating Club Inc. v. San Diego Yacht Club, 76 NY2d 256, 260 (1990).

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Footnote 4: The parties agree that the negotiations relating to certain long-term development rights on the San Francisco waterfront have been abandoned, so there is no basis to that claim.

Case 15: African Diaspora Mar. Corp. v. Golden Gate Yacht Club 109 A.D.3d 204 (N.Y. App. Div. 2013) In this case, Plaintiff African Diaspora Maritime Corporation, APPEALED the previous dismissal by Judge Kapnic of plaintiff’s claim against Golden Gate Yacht Club. After careful review and consideration, the New York State Court’s Judge Acosta UPHELD Judge Kapnic’s original decision and DENIED the ADM motion.

AFRICAN DIASPORA MARITIME CORPORATION, Appellant, v GOLDEN GATE YACHT CLUB, Respondent First Department, June 25, 2013 African Diaspora Mar. Corp. v Golden Gate Yacht Club, 38 Misc 3d 1214[A], 2013 NY Slip Op 50099(U), modified.

APPEARANCES OF COUNSEL McDermott Will & Emery LLP, New York City (Andrew B. Kratenstein, Banks Brown and Audrey Lu of counsel), for appellant.

Boies, Schiller & Flexner LLP, New York City (Philip M. Bowman and Julia C. Hamilton of counsel), for respondent. {**109 AD3d at 206} OPINION OF THE COURT ACOSTA, J.: The primary issue in this case is whether plaintiff, which submitted a timely application to compete in the upcoming America's Cup sailing regatta and was rejected, sufficiently pleaded a breach of contract claim to survive a CPLR 3211 motion to dismiss. Although defendant, the current trustee of the trophy, has discretion in selecting the defender, we find that plaintiff has alleged the existence of an enforceable contract between the parties and bad faith on defendant's part sufficiently to state a breach of contract cause of action. Contrary to the dissent's position, given the rules of the race, submission of an entry application with the appropriate fee binds defendant to review the application in good faith, and its failure to do so is a breach of contract. Whether plaintiff can ultimately establish its claim is irrelevant at this juncture since the sole consideration on a CPLR 3211 motion is whether the complaint sufficiently states a cause of action.

The America's Cup is governed by a Deed of Gift. The Deed of Gift is a trust instrument executed under the laws of New York State.

The corpus of the trust is the well-recognized trophy, simple possession of which spurs the sailing competition.

Since the 1970s, the America's Cup has allowed boats from multiple nations to participate in America's Cup events. A formal, initial "Challenger" triggers each competition for the Cup. In accordance with the Deed of Gift, the winner of the preceding competition (the Defender) and the Challenger must agree on rules, i.e., a protocol, for the next competition. Accordingly, defendant, Golden Gate Yacht Club (GGYC), the winner of the 33rd America's Cup held February 14, 2010, and the nonparty Club Nautico di Roma (CNR), the Challenger, agreed on "The Protocol Governing the 34th America's Cup" (the Protocol). Pursuant to the Protocol, additional participants from countries other than the country that holds the Cup are candidates for "Challenger"; additional participants from the country that possesses the cup are called "Defender Candidates." Challenger candidates, as well as the Challenger, must engage in an elimination series called the "Louis Vuitton Cup" to determine which single boat, from a single foreign country, may vie to compete against the Defender for the Cup. Similarly, {**109 AD3d at 207} Defender candidates, potentially including the last winner of the Cup, may (but are not required to) have their own elimination series to determine which organization's boat will represent the Defender's interest in a scheduled America's Cup event. "Defender Candidate" is defined as "a team selected by GGYC to participate in the America's Cup Defender Series, if any."

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Pursuant to the Deed of Gift, the Protocol states that the holder of the Cup (i.e., GGYC) acts as "trustee" in managing the Cup event, and must "act in the best interests of all Competitors collectively" and "not unreasonably favor the interests of any Competitor over another."

Plaintiff African Diaspora Maritime Corporation (ADM), a sailing organization based in North Carolina, alleges that on or about July 7, 2010, it contacted GGYC to inquire about applying to become a Defender Candidate in the 34th Cup. ADM was allegedly instructed

by GGYC to contact the chairman of the America's Cup Committee, Tom Ehman. ADM claims that GGYC had already formed a "Competitor Forum" (for the purpose, as defined in the Protocol, of "consultation and communication with Competitors") and could have put ADM in contact with its liaison to the Competitor Forum, Anthony Romano. Instead, ADM claims that between July 8, 2010 and March 26, 2011, it contacted GGYC, through Ehman, on a monthly basis, seeking information about becoming a Defender Candidate. ADM alleges that GGYC exhibited a pattern of continuing avoidance, providing it with little information until it was almost too late for ADM to enter the 34th Cup as a Defender Candidate. On March 26, 2011, GGYC referred ADM to Romano, and Romano provided ADM with information critical to its application, which allegedly had been made available to the Competitor Forum months earlier.

On March 31, 2011, just one day before the deadline, ADM was able to submit an application to be considered as a Defender Candidate for the 34th Cup. Along with its application, ADM paid the required $25,000 fee.

The Defender Application states in relevant part: "(2) The Defender Candidate by this Notice hereby challenges for the 34th America's Cup in accordance with the Protocol Governing the 34th America's Cup dated 31 August 2010 as amended. The Defender Candidate hereby agrees to be bound by and undertakes to comply with the terms of the said Protocol {**109 AD3d at 208} and all other rules set forth in its Article 11, and any amendments to the Protocol or those rules. "(3) Details of the Defender Candidate's corporate structure, registered business address and team management. We agree to provide further details of our challenge as GGYC may request to review and consider this application."

In paragraph (4) the Defender Application provides in relevant part that the Defender Candidate is bound by the terms of the Deed of Gift, the Protocol, and documents that are noted in Article 11 of the Protocol.

Article 8 of the Protocol, called "Acceptance of Defender Candidates," provides: "8.1 GGYC will accept applications to be a Defender Candidate from 1 November 2010 until 31 March 2011. There after, applications may be accepted at the discretion of GGYC upon such terms as it may determine.

"8.2 Defender Candidates shall comply with the Protocol and shall submit the documents and fees as set out in Article 9.

"8.3 GGYC will review Defender Candidate applications and will accept those it is satisfied have the necessary resources (including but not limited to financial, human, and technological) and experience to have a reasonable chance of winning the America's Cup Defender Series."

ADM alleges that from April 1, 2011 through April 15, 2011, GGYC falsely and repeatedly claimed that its application was deficient due to the lack of a signature and the lack of a document that evidenced payment of the $25,000 fee.

ADM alleges that it met all other application requirements, inasmuch as it had, inter alia: (1) assembled a qualified sailing team; (2) secured the services of a renowned boat designer (Dave Pedrick); (3) lined up commitments of "several wealthy African-Americans" to fund ADM's pursuit of a defender opportunity; (4) organized "a plan" with North Carolina's Secretary of Commerce and the State's Department of Tourism "to build a 'boat park' in Raleigh"; and (5) had "detailed plans . . . to create a media frenzy around its team (for both publicity and fundraising efforts)." As for its sailing team, ADM alleges that it included "three Olympians, an All-American, [and] several additional {**109 AD3d at 209} talented, experienced, and award-winning sailors." Further, ADM alleges that other "world class African-American sailors intended to join ADM's campaign" if "GGYC accept[ed] ADM as a Defender Candidate." ADM alleges that Pedrick is "an America's Cup award-winning yacht designer."

ADM further alleges that GGYC informed it that since ADM did not have a contract with Pedrick (Pedrick had conditioned his participation with ADM on ADM's obtaining Defender Candidate status), the information in its application was not accurate. ADM alleges that GGYC's objections to its application were "technical objections" that were "groundless." For instance, ADM alleges, GGYC "twist[ed]" Pedrick's statement that he had a conditional arrangement with ADM to mean that Pedrick had "denied" his

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association with ADM. ADM alleges that emails from Pedrick to ADM, as well as an April 15, 2011 email from Pedrick to GGYC, establish Pedrick's intent to design for ADM. By letter dated April 15, 2011, GGYC advised ADM that its application had been rejected. According to ADM, GGYC's stated reason was that it was "not satisfied that ADM has, or will have the necessary resources (including but not limited to financial, human, and technological) and experience to have a reasonable chance of winning the America's Cup Defender Series."

In December 2011, ADM commenced this action against GGYC alleging three causes of action: (1) breach of contract; (2) breach of trust; and (3) breach of fiduciary duty. With respect to the breach of contract claim, the complaint alleges that a contract was formed between ADM and GGYC when ADM accepted GGYC's offer/invitation to participate as a Defender Candidate. ADM asserts that its submission to GGYC of a completed Defender Candidate application, together with the $25,000 required under the Protocol, constituted an acceptance of the Defender Candidate offer, and that GGYC's failure to review the application in good faith breached the contract.

ADM alleges that GGYC had no basis to claim a lack of "satisfaction" with its application, since ADM stated that it would provide further details upon request, and GGYC never attempted to verify the status of ADM's team, its proposed funding sources, or its proposed team's experience. ADM alleges that GGYC knew that potential competitors typically do not draw funding until they are granted competitor status. ADM also alleges that GGYC had provided material and financial help to {**109 AD3d at 210} some struggling competitors, such as yachts or design packages, but not to all competitors, thus breaching its duty to treat all competitors equally. ADM seeks compensatory damages and numerous forms of equitable relief, including an order directing GGYC to accept its application.

In May 2012, GGYC moved to dismiss the complaint pursuant to CPLR 3211 (a) (1), (3) and (7), arguing, inter alia, that the complaint fails to state a cause of action.

As to the breach of contract claim, GGYC argued that the Protocol was a binding agreement between the Challenger (CNR) and itself only. At best, GGYC contended, the Protocol could be construed as a solicitation of bids, which, under New York law, would make a potential candidate's application the equivalent of an offer to participate in the Defender Series. Even assuming, arguendo, the existence of a binding contract between itself and ADM under the terms of the Protocol, GGYC further argued, ADM failed to show how it breached the terms of the Protocol in relation to ADM, since the Protocol expressly affords GGYC unfettered discretion to decide if an applicant meets the qualifications to compete. GGYC also argued that it gave ADM more than a fair opportunity to demonstrate its capacity to assemble a competitive, financially backed team that could compete in a Defender Series. GGYC stated that ADM did not allege that a proposed team member of ADM had ever competed in an America's Cup or that the ADM team had ever competed together on the same boat in a regatta. By contrast, GGYC noted, among the potential defenders for the 34th Cup, is Team Oracle, the victor in the 33rd Cup. Thus, GGYC argued, ADM's allegations failed to establish that its rejection of ADM's application was not reasonable and not in good faith. GGYC also argued that ADM failed to allege damages arising from a purported breach of contract, since, even if its application were accepted (based on an alleged contract), there was no guarantee that ADM would be selected as a Defender Candidate or that it would prevail in a Defender Series and win the 34th Cup. ADM opposed the motion, arguing, inter alia, that it stated a contract claim by alleging that it accepted the offer in the Protocol for defender applications and submitted a completed application and the requisite $25,000 fee. ADM argued that it did not have to allege that but for GGYC's wrongful rejection of its application it would have made a successful bid for the 34th Cup, and therefore was damaged, since GGYC's deprivation of its opportunity to compete constitutes compensable harm in and of itself. {**109 AD3d at 211} By order entered January 18, 2013, the motion court dismissed the complaint in its entirety, with prejudice (38 Misc 3d 1214[A], 2013 NY Slip Op 50099[U] [2013]). Since we find that ADM stated a breach of contract claim, we modify the order to reinstate that claim.

The sole criterion for deciding a motion to dismiss a complaint pursuant to CPLR 3211 (a) (7), "is whether the pleading states a cause of action, and if from its four corners factual allegations are discerned which taken together manifest any cause of action cognizable at law a motion for dismissal will fail" (Guggenheimer v Ginzburg, 43 NY2d 268, 275 [1977]). As the Court of Appeals instructed in 511 W. 232nd Owners Corp. v Jennifer Realty Co. (98 NY2d 144, 151-152 [2002]), "In furtherance of this task, we liberally construe the complaint, and accept as true the facts alleged in the complaint and any submissions in opposition to the dismissal motion. We also accord plaintiffs the benefit of every possible favorable inference.

Dismissal under CPLR 3211 (a) (1) is warranted only if the documentary evidence submitted conclusively establishes a defense to the asserted claims as a matter of law" (citations and internal quotation marks omitted).

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Indeed, "[w]hether a plaintiff . . . can ultimately establish its allegations is not taken into consideration in determining a motion to dismiss" (Philips S. Beach, LLC v ZC Specialty Ins. Co., 55 AD3d 493, 497 [1st Dept 2008] [emphasis added], lv denied 12 NY3d 713 [2009]).

Here, viewing the alleged facts in the light most favorable to ADM, we find that the complaint states a breach of contract claim so as to avoid dismissal. "[T]he rules of a contest constitute a contract offer and . . . the participant's [entry into] the contest constitute[s] an acceptance of that offer," creating a binding contract (Sargent v New York Daily News, L.P., 42 AD3d 491, 493 [2d Dept 2007] [internal quotation marks omitted]; see also Robertson v United States, 343 US 711, 713 [1952] [contestant's acceptance of the contest sponsor's offer to compete in a symphonic works contest created an enforceable contract]).

Articles 8 and 9 of the Protocol set forth the procedure for applying to become a Defender Candidate in "definite and certain" detail by specifying the dates during which applications will be accepted and the required documentation and application {**109 AD3d at 212} fee, and Schedule Two to the Protocol provides applicants for Defender Candidate ("Defender Applicants") with the exact language that should be used in their applications (see Keis Distrib. v Northern Distrib. Co., 226 AD2d 967, 969 [3d Dept 1996] [internal quotation marks omitted]; see also Caride v Alonso, 78 AD3d 466, 467 [1st Dept 2010], lv dismissed in part, denied in part 16 NY3d 806 [2011]). Thus, the Protocol constituted an offer.

The duties that GGYC offered to undertake to an applicant that submitted the prescribed application along with the $25,000 fee were also definite and certain. GGYC agreed to "review" the application and to accept the applicant as a Defender Candidate if it was "satisfied" that the applicant had a "reasonable chance of winning" the America's Cup Defender Series. The Protocol's terms demonstrate GGYC's unequivocal intent to be bound by those terms.

The dissent attempts to distinguish Sargent (42 AD3d at 491) and Robertson (343 US at 711) by noting that in those cases the plaintiffs had already won, while in the present case, "the applicant must first be approved by the Defender [to be qualified] and then participate in a series of yacht races with the objective of winning the America's Cup Defender Series." The dissent misses the point. The Protocol in this case creates a mutual obligation between GGYC as trustee and Defender Applicants: a Defender Applicant is obligated to abide by the Protocol and GGYC is obligated to administer the Protocol in good faith (see Curtis Props. Corp. v Greif Cos., 212 AD2d 259, 265-266 [1st Dept 1995] ["courts avoid an interpretation that renders a contract illusory and therefore unenforceable for lack of mutual obligation and prefer to enforce a bargain where the parties have demonstrated an intent to be contractually bound" (citation omitted)]).

ADM accepted GGYC's offer by timely submitting its "Application of Defense" in the required form along with the required fee, thus creating an enforceable contract (see Robertson, 343 US at 713; see also Kowalchuk v Stroup, 61 AD3d 118, 122 [1st Dept 2009]).

ADM's acceptance of GGYC's offer obligated GGYC to review ADM's application in "good faith" (Dalton v Educational Testing Serv., 87 NY2d 384, 389 [1995] ["Where the contract contemplates the exercise of discretion, this pledge includes a promise not to act arbitrarily or irrationally in exercising that discretion"]; see also Peacock v Herald Sq. Loft Corp., 67 AD3d{**109 AD3d at 213} 442, 443 [1st Dept 2009] ["Even if the . . . agreement does not, on its face, set limits on the board's ability to refuse to approve the scope of work, the contract's implied covenant of good faith and fair dealing would prevent defendants from exercising that power arbitrarily"]; C & E 608 Fifth Ave. Holding, Inc. v Swiss Ctr., Inc., 54 AD3d 587, 588 [1st Dept 2008] ["exercise of an apparently unfettered discretionary contract right breaches the implied obligation of good faith and fair dealing if it frustrates the basic purpose of the agreement and deprives plaintiffs of their rights to its benefits" (internal quotation marks omitted)]). The dissent is correct in noting that our holding gives "expansive scope to Woody Allen's observation" that "[e]ighty percent of success is showing up."

Success, however, is accomplished in this case by having GGYC, as trustee of the Cup, review properly submitted applications in good faith. Thus, contrary to GGYC's and the dissent's contention, the contract did not give it unfettered discretion to reject ADM's application (see Dalton, 87 NY2d at 389). Rather, GGYC had the discretion to reject applications which in good faith it deemed unsatisfactory. Moreover, whether GGYC acted in good faith is not appropriately decided on a motion to dismiss (see Peacock, 67 AD3d at 443 ["Whether defendants acted arbitrarily or unreasonably . . . presents questions of fact"]).

ADM alleges facts sufficient to raise the question whether GGYC acted in bad faith. Specifically, ADM alleges that: GGYC attempted to sabotage its efforts to submit an Application of Defense by excluding it from the Competitor Forum, thereby preventing it from obtaining information critical to the application; GGYC initially sought to deny ADM's Application of Defense on various technicalities, including that it was not signed and did not include a document evidencing payment of the $25,000 fee; GGYC falsely asserted that ADM had lied about its proposed team, claiming that Pedrick, ADM's yacht designer, had denied being a member of ADM's team; and GGYC falsely claimed that it rejected ADM's Application of Defense because it was not satisfied that ADM "[would]

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have the necessary resources" to compete, even though America's Cup teams do not obtain funding until after their applications are accepted.

We reject GGYC's argument that the complaint fails to allege damages. ADM does not have to plead that, had its Application been accepted, it would have beaten Team Oracle or won the Cup. Rather, denying ADM fair consideration of its application was harm in and of itself (see Dalton, 87 NY2d at 394 ["Dalton {**109 AD3d at 214}is entitled to relief that comports with ETS's contractual promise—good-faith consideration of the material he submitted to ETS"]). As GGYC recognizes, under Dalton, "GGYC would . . . be required to consider ADM's application in good faith."

The dissent, citing Matter of Pollak v Conway (276 App Div 435, 437 [3rd Dept 1950], lv denied 301 NY 816 [1950]), notes that an organization "may set such standards for candidates that it deems appropriate" and that courts should decline to interfere in administrative matters. Although that may generally be true, the Deed of Gift has expressly made New York courts the arbiter of its disputes (see Mercury Bay Boating Club v San Diego Yacht Club, 150 AD2d 82 [1st Dept 1989], affd 76 NY2d 256 [1990]; Golden Gate Yacht Club v Societe Nautique de Genève, 55 AD3d 26 [1st Dept 2008], revd 12 NY3d 248 [2009]; Golden Gate Yacht Club v Société Nautique de Genève, 68 AD3d 552 [1st Dept 2009]), and its Protocol guides this Court in deciding those disputes. In the end, this is a sporting competition, and the winner should be decided in the open waters, rather than in a courtroom. After all, it is not a competition if the defender wins by default (see Norimitsu Onishi, When Billionaire Sets Rules, It's an Exclusive Race, NY Times, June 4, 2013, § A at 1, col 2). Although plaintiff does not have the right to be deemed a challenger, it is entitled to have its timely submitted application reviewed in good faith.

ADM's remaining arguments have no merit since it has no basis for asserting a beneficiary interest in the charitable trust (see Alco Gravure, Inc. v Knapp Found., 64 NY2d 458, 465 [1985]). Nor does it have standing to assert a breach of fiduciary duty claim (see Matter of Rosenthal, 99 AD3d 573 [1st Dept 2012], lv dismissed in part, denied in part 20 NY3d 1058 [2013]).

Accordingly, the order of the Supreme Court, New York County (Barbara R. Kapnick, J.), entered January 18, 2013, which granted defendant's motion to dismiss the complaint, should be modified, on the law, to deny the motion as to the breach of contract claim, and otherwise affirmed, without costs.

Tom, J.P. (dissenting). This is ostensibly an action for breach of contract, to which plaintiff has appended claims of an asserted breach of trust, based on defendant's rejection of plaintiff's application to participate in the America's Cup yacht race, to be held this year. Since no contract between the parties ever arose, the contract claim must be dismissed. Further, any {**109 AD3d at 215} right to participate in the America's Cup competition that plaintiff might be said to possess is bestowed solely by the agreement or "Protocol" between defendant Golden Gate Yacht Club (GGYC), as Defender and trustee of the trophy under the Deed of Gift, and nonparty Club Nautico di Roma, as Challenger of Record. Because plaintiff is not a prospective beneficiary under the Deed of Gift, it lacks standing to assert any claim based upon the trust instrument. Thus, the complaint fails to state a cause of action.

Contrary to the position adopted by the majority, true contract actions are amenable to summary disposition on the basis of the documents comprising the parties' agreement, except where a legitimate ambiguity requires resort to extrinsic evidence to establish the parties' intent. It is settled that the interpretation of a contract is a question of law for the court (West, Weir & Bartel v Mary Carter Paint Co., 25 NY2d 535, 540 [1969]; Eden Music Corp. v Times Sq. Music Publs. Co., 127 AD2d 161, 164 [1st Dept 1987]), and where, as here, no cause of action is discernable, further proceedings will be futile. What the majority fails to appreciate is that, in a contract action, the four corners of the complaint are constrained by the four corners of the agreement.

The race for the America's Cup is regarded as the most prestigious event in yacht racing, and it is certainly one of the most highly contested—both on and off the water. In the last quarter century, it has been the subject of three controversies brought before this Court. The first involved the propriety of challenging a single-hulled vessel with a catamaran, abrogating what has become the custom of racing yachts of a similar design or class (Mercury Bay Boating Club v San Diego Yacht Club, 150 AD2d 82 [1st Dept 1989], affd 76 NY2d 256 [1990]). The second concerned the requirement that to be recognized as a bona fide challenger for the Cup, a yacht club must have held an annual regatta before giving its notice of challenge; the result there was the disqualification of the challenger designated by the defending club (Golden Gate Yacht Club v Societe Nautique de Genève, 55 AD3d 26 [1st Dept 2008], revd 12 NY3d 248 [2009], on remand 68 AD3d 552 [1st Dept 2009]). This third action, like the others, involves the distinction between what is required by the Deed of Gift and what is mutually agreed upon by the two contenders subject to its terms, as a matter of contract.

The prestige of winning the America's Cup attracts sailing organizations from around the world, which vie to win and {**109 AD3d at 216} retain possession of the silver Cup for what is typically a champion-reigning period of three to four years, that is, until the next "Challenger" for the trophy officially initiates a new worldwide competition. The trophy derives its name from the schooner

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America, to which it was awarded after the vessel won a race at Cowes, England on August 21, 1851. By Deed of Gift dated October 24, 1887, the Cup was transferred by its sole surviving owner, George L. Schuyler, to the New York Yacht Club "upon the conditions that it shall be preserved as a perpetual Challenge Cup for friendly competition between foreign countries."

The Deed of Gift is a trust instrument executed under the laws of New York State (subsequently amended by orders of the Supreme Court of the State of New York dated December 17, 1956 and April 5, 1985). The corpus of the America's Cup trust is the trophy itself, and the honor and recognition bestowed by the mere possession of the coveted prize is the impetus for the worldwide interest in the sailing competition. Any yacht club to which the Cup is transferred must agree to comply with the terms and conditions of the Deed of Gift. The trust instrument provides: "Any organized Yacht Club of a foreign country . . . shall always be entitled to the right of sailing a match of this Cup, with a yacht or vessel propelled by sails only and constructed in a country to which the Challenging Club belongs, against any one yacht or vessel constructed in the country of the Club holding the Cup." Once a notice of challenge (required to be made on 10 months' notice) has been received and accepted, the Challenger and Defender of the Cup "may, by mutual consent, make any arrangement satisfactory to both as to the dates, courses, number of trials, rules and sailing regulations, and any and all other conditions of the match, in which case also the ten months' notice may be waived." If the contenders "cannot mutually agree upon the terms of a match, then three races shall be sailed, and the winner of two of such races shall be entitled to the Cup." The Deed of Gift prescribes the type, length and minimum depth of the courses, the timing of the races and the rules to be applied. The default provisions conclude, "The challenged Club shall not be required to name its representative vessel until at a time agreed upon for the start, but the vessel when named must compete in all the races, and each of such races must be completed within seven hours." {**109 AD3d at 217} Defendant was represented in the 33rd America's Cup event by a racing syndicate known as Team Oracle Racing (not a party to this litigation). Consistent with the cycle of recent America's Cup events, Team Oracle prevailed in the 33rd Cup's initial elimination series, earning the right to compete against the 32nd Cup winner and Defender, nonparty Société Nautique de Genève of Switzerland. Defendant succeeded to the position of Defender and trustee of the America's Cup when its yacht, sailed

by Team Oracle, won that match on February 14, 2010.

In February 2010, defendant announced that it had accepted the notice of challenge from Club Nautico di Roma, designating that yacht club as the Challenger of Record under the Deed of Gift against defendant, as the Defender, trustee and holder of the Cup. The two yacht clubs then entered into the agreement known as "the Protocol" dated September 13, 2010, the stated purpose of which "is to promote a competitive regatta for all Competitors consistent with the provisions of the Deed of Gift." The Protocol recites that applications will be accepted from other yacht clubs. It states that the parties "have agreed to hold a series of races to select the challenger for the Match," designated the America's Cup Challenger Series. As pertinent to this dispute, the Protocol provides that defendant "may hold a series of races to select the Defender to represent GGYC in the Match." Section 8.3 of the Protocol provides that defendant "will review Defender Candidate applications and will accept those it is satisfied have the necessary resources (including but not limited to financial, human, and technological) and experience to have a reasonable chance of winning the America's Cup Defender Series." Defendant and Club Nautico di Roma also entered into a "34th America's Cup Host and Venue Agreement," which selected San Francisco as the situs of the current America's Cup race.

The complaint alleges that defendant's failure to accept plaintiff's application to be a Defender Candidate constitutes a breach of contract, breach of trust and breach of fiduciary duty because, it asserts, plaintiff has all the requisite qualifications set forth in the Protocol to qualify as a Defender Candidate, and defendant failed to consider its application in good faith. The complaint states that defendant's reason for rejecting plaintiff's application was that it was "not satisfied that [plaintiff] has, or will have the necessary resources (including but not limited to financial, human, and technological) and experience to have a reasonable chance of winning the America's Cup Defender Series." {**109 AD3d at 218} The Deed of Gift is the instrument of a charitable trust (see Golden Gate Yacht Club v Société Nautique de Genève, 12 NY3d 248 [2009]; Mercury Bay Boating Club v San Diego Yacht Club, 76 NY2d 256, 260 [1990]). Generally, the Attorney General is the party vested with statutory authority to enforce the provisions of a charitable trust on behalf of its beneficiaries (EPTL 8-1.1 [f]; 8-1.4; see Lefkowitz v Lebensfeld, 51 NY2d 442, 445 [1980]), following the well-settled rule that "a possible beneficiary of a charitable trust, or a member of a class of possible beneficiaries, is not entitled to sue for enforcement of the trust" (Alco Gravure, Inc. v Knapp Found., 64 NY2d 458, 465 [1985]). A limited exception, which has been applied in other America's Cup cases entertained by the courts, is that standing may exist where "a particular group of people has a special interest in funds held for a charitable purpose . . . and the class of potential beneficiaries is sharply defined and limited in number" (id.).

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The express provisions of the Deed of Gift govern the match race to be held between the Defender of the Cup, as trustee, and the Challenger of Record, as potential beneficiary (see Mercury Bay Boating Club, 76 NY2d at 267). Within the ambit of potential beneficiaries are the trustee and the yacht club formally recognized by the trustee as the Challenger of Record. Also accorded standing, as exemplified by Golden Gate Yacht Club, is a club claiming the right to be designated as the Challenger on the ground that the Challenger recognized by the Defender fails to meet the eligibility requirements stated in the Deed of Gift, in which case the would-be Challenger is deemed to possess a sufficient special interest in the corpus of the trust to be entitled to sue for its enforcement.

In sum, standing has been limited to the Defender of the Cup, the recognized Challenger, and a yacht club claiming the right to be designated as the Challenger. Patently, plaintiff can assert no claim to be the Defender because the capacity of Defender and trustee under the Deed of Gift is fulfilled by defendant. Equally, plaintiff can assert no claim to be designated Challenger of Record because it is not a foreign yacht club. Finally, plaintiff does not attack the qualifications of the Challenger recognized by the Defender. Thus, plaintiff cannot accede to the position of one of the two parties recognized under the trust instrument.

There is no merit to plaintiff's theory that it should be considered a potential beneficiary of the trust because it desires {**109 AD3d at 219}to compete as a Defender Candidate in the America's Cup Defender Series and ultimately might succeed in being chosen to represent defendant in the match for the America's Cup. Even if this eventuality were to arise, plaintiff would not be promoted to the position of Defender under the trust instrument. The Defender is defendant Golden Gate Yacht Club. The Deed of Gift affords the Defender the right to designate its vessel at any time before the start of the match. The most to which plaintiff can aspire is the right to sail on behalf of the Defender as the defending vessel; it cannot become the Defender, as that term is used in the trust instrument. Even if plaintiff were designated to sail on behalf of the Defender and won the match, it would merely become the winning yacht. Possession of the trophy would remain in defendant in its capacity as Defender and trustee. Finally, were plaintiff permitted to proceed with its trust claims, standing could be asserted by all of the yacht clubs chosen to participate in the regatta, as well as all those who applied but were not chosen to participate. This is a potentially numerous and amorphous class that is neither "limited in number" nor "sharply defined" so as to come within the exception to the general rule enunciated in Alco Gravure (64 NY2d at 465). Thus, plaintiff lacks standing, and its causes of action for breach of trust and breach of fiduciary duty were properly dismissed.

As to plaintiff's contract claim, it is elementary that before a court can enforce a contract, it must establish, first, that the parties intended to be mutually bound by an agreement and, second, what the agreement requires of them, both factors implicating the doctrine of definiteness (Cobble Hill Nursing Home v Henry & Warren Corp., 74 NY2d 475, 482 [1989], cert denied 498 US 816 [1990]; see also Charles Hyman, Inc. v Olsen Indus., 227 AD2d 270, 275-276 [1st Dept 1996]). It is plaintiff's theory that the parties are mutually bound because the Protocol constitutes an offer, extended by defendant and accepted by plaintiff upon submission of its application and accompanying fee. It concludes that a contract was thereby formed requiring defendant to exercise good faith in reviewing the application, which defendant is alleged to have breached in various ways set forth in the complaint. Plaintiff posits that the Protocol "memorializes the Deed of Gift's hopes for fair play," and charges that defendant breached this duty by manufacturing "lame" excuses to deny plaintiff the right to participate in the competition as a Defender Candidate. {**109 AD3d at 220} Dispositive of the question of contract formation in general is whether indeed an offer has been made (see Kasowitz, Benson, Torres & Friedman, LLP v Duane Reade, 98 AD3d 403 [1st Dept 2012], affd 20 NY3d 1082 [2013]); if so, whether the offer invites acceptance by the means used (see Defeo v Amfarms Assoc., 161 AD2d 904 [3d Dept 1990]); and whether all conditions required for a valid acceptance have been fulfilled (see King v King, 208 AD2d 1143 [3d Dept 1994]). By imposing a contractual obligation on defendant, when there is none, the majority ignores the clear language of the Protocol relating to Defender applications.

The Protocol, by its express terms under section 8.3, extends only an invitation to prospective Defender Candidates to submit an application that, after review, defendant "will accept" if "it is satisfied" that the applicant meets the specified criteria. This provision clearly negates any mutual assent by defendant to be bound to an agreement with an applicant for Defender Candidate (see generally Thome v Alexander & Louisa Calder Found., 70 AD3d 88, [*13]103-104 [1st Dept 2009], lv denied 15 NY3d 703 [2010] [language contained in invitation does not manifest an intent to be bound, warranting dismissal of breach of contract claim]; Kowalchuk v Stroup, 61 AD3d 118, 121 [1st Dept 2009] ["To establish the existence of an enforceable agreement, a plaintiff must establish an offer, acceptance of the offer, consideration, mutual assent, and an intent to be bound"]).

There is nothing in the unambiguous language of section 8.3 or within the four corners of the contract that would impose a contractual duty upon defendant to accept an applicant for Defender Candidate upon submission of a compliant application.

Rather, the solicitation of applications initiates a process of evaluation of the credentials and capabilities of the applicants for the

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purpose of determining those that are most suitable for a particular purpose (see Wright v Ford Motor Co., 111 AD2d 810 [2d Dept 1985]). The soliciting organization may set such standards for candidates that it deems appropriate, and where the issue has been directly considered, the courts have declined to interfere in what has been regarded as an administrative matter (see Matter of Pollak v Conway, 276 App Div 435, 437 [3d Dept 1950], lv denied 301 NY 816 [1950]). Thus, an organization is free to accept or reject any applicant in the exercise of its judgment (see Sabetay v Sterling Drug, 69 NY2d 329, 333 [1987] [employment]; Sitomer v Half Hollow Hills Cent. School Dist., 133 AD2d 748 [2d Dept 1987] [participation in high school {**109 AD3d at 221} athletics program]; Matter of Lesser v Board of Educ. of City of N.Y., 18 AD2d 388, 390 [2d Dept 1963] [college admission]). Since defendant did not accept plaintiff's application, no contract arose for which an action for breach can be maintained.

The Protocol's use of the term "satisfied" indicates that the assessment of an applicant's likelihood of winning the America's Cup Defender Series is to be made in the exercise of defendant's unfettered judgment (see Fursmidt v Hotel Abbey Holding Corp., 10 AD2d 447, 449-450 [1st Dept 1960]). As the Fursmidt Court stated, "The performance here called for is much removed from that involving mechanical fitness, utility or marketability," which is subject to some "positive, objective standard" (id. at 450 [internal quotation marks omitted]). Rather, "in cases involving taste and judgment such standards of reasonableness cannot be established" (id.). Thus, even assuming a valid contract, the determination whether to utilize plaintiff's services as a competitor in its regatta is a matter relegated to the exercise of defendant's judgment and is not subject to judicial interference.

There is no merit to plaintiff's suggestion that the assessment of a prospective Defender Candidate implicates defendant's fiduciary duties, irrespective of the recitation under Article 3 of the Protocol that "GGYC (in its capacity as trustee), Challenger of Record (in its capacity as Challenger of Record) [and others involved in the regatta] . . . shall: (i) act in the best interests of all Competitors collectively . . . and (ii) not unreasonably favor the interests of any Competitor over another." These provisions clearly make reference, and pertain, to Defender Candidates (and Challenger Candidates) as competitors. This language has no application to plaintiff, which is not a "Competitor" (defined in the Protocol as "a Defender Candidate or a Challenger") since its application to compete in the contemplated regatta as a Defender Candidate has not been accepted. Merely reciting defendant's capacity as Defender in the Protocol does not implicate defendant's fiduciary duties under the Deed of Gift. In that regard, it should be noted that the Deed of Gift expressly governs only the match between Defender and Challenger (see Mercury Bay Boating Club, 76 NY2d at 267 ["the deed ensures a 'match' which will be a one-on-one competition"]), with the proviso that the contestants "may, by mutual consent," depart from "any and all other conditions of the match." The Deed of Gift is silent about such preliminaries as how the defending yacht is to be chosen, except to require {**109 AD3d at 222} that the selection be made by race time. Thus, the Defender and Challenger are free to contract as they deem appropriate with respect to the manner in which the competing vessels are designated. Since defendant's obligations with respect to the selection of contestants are, by contract, subject to its own satisfaction, defendant was entitled to accept or reject plaintiff's application as it saw fit.

To support its contention that a binding contract was formed, plaintiff relies on Sargent v New York Daily News, L.P., (42 AD3d 491 [2d Dept 2007]), for the proposition " 'that the rules of a contest constitute a contract offer and that the participant's [entry into] the contest constitute[s] an acceptance of that offer' " (at 493, quoting Diop v Daily News, L.P., 11 Misc. 3d 1083[A], 2006 NY Slip Op 50671[U], *3 [2006]), which plaintiff advances as a general principal of law. Thus, plaintiff reasons, merely by submitting to defendant its application to be a participant in the racing events with the required fee provided in the Protocol, a binding contract was formed, imposing upon defendant the obligation to exercise good faith in the selection of Defender Candidates.

There is no question that under certain circumstances the mere participation in a contest imposes a contractual obligation on the sponsor. In Sargent, the use of a daily game card by the plaintiff was held to constitute the acceptance of an offer to join the contest, binding the plaintiff to the rules printed on the reverse side (see also Fujishima v Games Mgt. Servs., 110 Misc. 2d 970 [Sup Ct, Queens County [1981]). The matter before this Court, however, is readily distinguishable from such contests, since it involves considerably more than a claim to winnings under circumstances where participation is limited to the purchase, or even the mere use, of a game card. The process at issue is not, by analogy, the mere purchase of a game card; rather, the applicant must first be approved by the Defender and then participate in a series of yacht races with the objective of winning the America's Cup Defender Series. Notably, the game card cases and others cited by plaintiff involve winners or asserted winners of a contest. To consider plaintiff's submission of an application comparable to the presentation of a winning ticket would accord overly expansive scope to Woody Allen's observation, "Eighty percent of success is showing up." Here, plaintiff's application was rejected as unsatisfactory before the contest had even begun.

Plaintiff cites Robertson v United States (343 US 711, 713 [1952]) for the proposition that "acceptance by the contestants {**109 AD3d at 223} of the offer tendered by the sponsor of the contest creates an enforceable contract." Unlike plaintiff, however, the contestant in Robertson had actually won the musical competition in question. Moreover, the narrow issue decided was whether,

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for tax classification purposes, the payment of winnings by a sponsor of a contest comprises the discharge of a contractual obligation, rather than a gift (id. at 713). Since the Robertson Court was not confronted with an executory contract but one that had been fully performed, the issue of formation—particularly whether the sponsor of the musical competition had made an offer that [*15] the winning contestant could accept—was not before it. Likewise, Dalton v Educational Testing Serv. (87 NY2d 384, 389 [1995]) sheds no light on the question whether the submission of an application to participate in a sporting event constitutes an acceptance of an offer to participate. In Dalton, the Court of Appeals did not discuss formation, but simply stated that "[b]y accepting [Educational Testing Service]'s standardized form agreement . . . Dalton entered into a contract with ETS." It should also be noted that, in marked contrast to the matter at bar, Dalton does not involve qualifications that an applicant must meet in order to participate in the testing process.

The law imposes no obligation on an organization to exercise its judgment to select any particular applicant for a particular function, no matter how qualified; rather, it is expected that an organization will act in its own best interests, which would not be served by rejecting qualified candidates. Here, defendant points out that plaintiff does not allege that a proposed team member of plaintiff has ever competed in an America's Cup race or that the plaintiff team has ever competed together on the same boat in a regatta. It is further noted that plaintiff's ability to raise capital and secure the services of an expert boat designer appears to depend on defendant's granting its application. Even assuming, arguendo, that there were a contractual right to be enforced, which clearly there is not, plaintiff's limited experience as a competitive sailing organization and its questionable ability to raise capital, retain an expert boat designer and assemble a competitive, financially backed team that could successfully compete in the Defender Series undermine its claim of bad faith.

The majority's holding deprives defendant of its contractual right under the Protocol to decide what is in its best interests in promoting the America's Cup Defender Series, a duty it was charged with as Defender under the trust instrument, and {**109 AD3d at 224} substitutes some ad hoc standard to be judicially formulated at trial. As the Third Department noted in Matter of Pollak (276 App Div at 437-438), the courts are ill equipped to devise the criteria for assessing a candidate's qualifications or to administer the organization's application of those criteria, a sentiment that finds particular application in the context of such a high-level sailing event.

Finally, plaintiff's claim must be rejected as a matter of policy. To permit a contract action to be maintained by any person or group that has been denied the right to participate in an athletic event would subject the courts to a potentially enormous volume of litigation and involve them in the assessment of athletic abilities, an area in which they lack expertise. It is simply not the province of the courts to decide, for instance, whether any particular applicant should be accorded the right to participate in the New York City Marathon or whether a promising player should be selected to play for a professional sports team or, for that matter, whether a particular seventh-grader should be permitted to play on a local high school tennis team (see Sitomer, 133 AD2d at 748).

Whether plaintiff has the necessary qualifications "to have a reasonable chance of winning the America's Cup Defender Series" and so to be selected as a Defender Candidate, as the Protocol provides, " 'is a knotty point, and should have been submitted to the arbitration of sportsmen' " (Mercury Bay Boating Club, 150 AD2d at 101 [Rubin, J., concurring], quoting Pierson v Post, 3 Caines 175, 180 [1805, Livingston, J., dissenting]). The substance of the complaint, with its emphasis on defendant's asserted failure to exercise "good faith," is that defendant has been treated unfairly in the selection process. As stated in Pierson and reiterated in Mercury Bay, in the absence of fiduciary or equitable considerations, the function of the courts is to decide what is within the bounds of the law, an assessment that does not embrace determining what is fair in the context of a sporting event.

Accordingly, the order should be affirmed.

Feinman and Clark, JJ., concur with Acosta, J.; Tom, J.P., dissents in a separate opinion.

Order, Supreme Court, New York County, entered January 18, 2013, modified, on the law, to deny the motion as to the breach of contract claim, and otherwise affirmed, without costs.

ITEM: On August 7, 2013, ADM withdrew with prejudice (permanently) its motion for a preliminary injunction against GGYC seeking to enjoin the America’s Cup races scheduled to begin on September 7, 2013. The parties have agreed not to comment publicly on this matter until further notice. s/s Tom Ehman, GGYC Vice Commodore ITEM: On August 21, 2014, ADM and GGYC reached a settlement in the three-year litigation following court-ordered mediation in New York’s Commercial Division. (NFI)

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INTERPRETIVE RESOLUTIONS TO THE DEED OF GIFT ADOPTED BY THE TRUSTEES Resolution adopted by the Board of Trustees on March 27, 1958 (The "1958 Resolution") WHEREAS, a question has been raised on behalf of certain individuals, citizens of a foreign country, interested in a possible challenge for the America’s Cup, as to whether a challenge would be accepted by the New York Yacht Club if the challenger were designed in the United States but the hull built in the country of the challenging Club; and WHEREAS, by the original Deed of Gift of the America’s Cup dated July 8, 1857, it was expressly provided that the Cup should be "perpetually a Challenge Cup for friendly competition between foreign countries"; and WHEREAS, by the second Deed of Gift dated January 4, 1882, it was provided that the yacht challenging for the Cup and the yacht defending must be "constructed" in the country to which the challenging and defending Clubs respectively belong; and the above recited provision that the Cup should be "perpetually a Challenge Cup for friendly competition between foreign counties" as again set forth; and WHEREAS, by the third and present Deed of Gift dated October 24, 1887, it was again provided that the Cup should be a "perpetual Challenge Cup for friendly competition between foreign counties," and the second paragraph thereof contained the provision above referred to that the challenging and defending yachts shall be constructed in the countries they respectively represent; NOW, THEREFORE, in view of the expressed intent of the donors of the America’s Cup that is should be "perpetually a Challenge Cup for friendly competition between foreign countries," and the fact that in accordance with that intent and commencing with the first race for the Cup in 1870 down to the present time every challenger has been both designed and constructed in the country of the defending Club so that every challenger and every defender has been in all respects truly representative of the countries of the challenging and defending club and the Cup has become by tradition the symbol of the yachting supremacy of the country of the Club winning the challenge match: RESOLVED that the word "constructed" wherever it appeared in the Deed of Gift of the America’s Cup shall always be construed as "designed and built".

W. Mahlon Dickerson, Secretary

Resolution adopted by the Board of Trustees on December 7, 1962 [Rescinded July 15, 1980] WHEREAS, certain citizens or subjects of foreign countries, members of yacht clubs which qualify under the Deed of Gift of the America’s Cup, and which yacht clubs are considering challenging for the America’s Cup, have raised the question as to whether the obtaining of components (other than raw materials), fittings and sails, or the use of design facilities such as a towing tank; outside of the Board’s Resolution of March 27, 1958, construing the word "constructed" in the Deed of Gift as "designed and built"; and WHEREAS, by Resolution dated March 27, 1958, the Board construed the word "constructed" wherever it appears in the Deed of Gift of the America’s Cup as meaning "designed and built"; it is RESOLVED, that the word "designed" includes the use of a design facility such as a towing tank, and that the work "built" included components, fittings and sails; and WHEREAS, the Board recognizes that components, fittings and sails and the availability of design facilities such as towing tanks may not be obtainable in the country of the challenging club; it is RESOLVED, that recognizing that such design facilities may not be available and components, fittings and sails may not be obtainable in the country of the challenging club, will consider a request for permission to obtain certain of the aforesaid components, fitting and sails and to use the aforesaid design facilities in any country other than that of the defending club; RESOLVED, that whenever, the Deed of Gift of the America’s Cup is printed this Resolution with preamble adopted by the Board of Trustees on march 27, 1958, interpreting the word "constructed" to mean "designed and built," be printed with the Deed of Gift.

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W. Mahlon Dickerson Secretary

Resolution adopted by the Board of Trustees on July 15, 1980 (The "1980 Resolutions") AND AMENDED ON MARCH 9, 1982 (The "1982 Amendments") WHEREAS by Resolution adopted March 27, 1958 (the "1958 Resolution") this Board interpreted the word "constructed" as used in the Deed of Gift of the America’s Cup (the Deed of Gift") to mean "designed and built"; and WHEREAS by Resolutions adopted December 7, 1962 (the "1962 Resolution") this Board set forth its interpretation of the words "designed and built" as used in the 1958 Resolution and set forth certain procedures relation to the application of such interpretation; and WHEREAS because of the great increase in recent years in the exchange among the world’s yachtsmen, yacht designers, yacht builders and sailmakers of technology, techniques, material and facilities for the design and construction of yachts, their rigs and their sails, the interpretations set forth in the 1962 Resolutions are no longer workable or meaningful; WHEREAS the purposes of the Deed of Gift, particularly the provision thereof that the America’s Cup "shall be preserved as a perpetual Challenge Cup for friendly competition between foreign countries", will be furthered by a requirement that the members of a candidate’s crew shall be nationals of the country in which the club represented by the candidate is located; it is RESOLVED that he 1962 Resolutions be, and the same hereby are rescinded; and RESOLVED that the 1958 Resolution be, and the same hereby is, ratified and confirmed; and RESOLVED that for the purposes of the 1958 Resolution: A yacht shall be deemed to be "designed" in a country if the designers of the yacht’s hull, rig and sails shall be nationals of that country; and A yacht shall be deemed to be "built" in a country in a country if the hull of the yacht, including all framing and all planking, plating or other form of surfacing of the hull, shall be fabricated and assembled, and if the yacht’s sails shall be manufactured, in that country; provided that the foregoing provisions of this clause (b) shall not prevent the modification of the hull of any challenger, or candidate, in the country in which an America’s Cup Match is to take place so long as the modification or manufacture (i) is effected when the challenger or candidate is in such country and (ii) meets the requirements of clause (a) above; and RESOLVED, that notwithstanding the provisions of the foregoing resolution, any yacht which was eligible as a candidate for the America’s Cup Match in 1980 shall continue to be eligible thereafter provided that any material modification of the hull, rig or sails thereof shall be designed in accordance with the requirements of clause (a) of the foregoing resolution and any material modification of the hull thereof shall be completed in accordance with the requirements of clause (b) of the foregoing resolution; and [Rescinded July 1, 1980] RESOLVED that, for a candidate to be eligible for an America’s Cup Match in any year subsequent to 1980, every member of the candidate’s crew must be a national of the country in which the club represented by the candidate is located; and RESOLVED that henceforth any reference to the Deed of Gift shall be deemed to include reference to the 1985[sic] Resolution and to these Resolutions, which shall hereafter be known as the "1980 Resolutions" and that whenever hereafter the Deed of Gift is printed or otherwise reproduced, the 1958 Resolution and the 1980 Resolutions shall be printed or reproduced as an integral part thereof.

Footnotes in Amplification (March 9, 1982) 1.The requirements that a person be a national will be satisfied if the person is domiciled in, or has a principal place of residence in, or has a valid passport of that country since January 1, 1982. [Rescinded May 1984 and replaced with revised words] 2.Designers of sails may cooperate on an international basis until March 1, 1982; after which date, sail designers of different countries may not collaborate. Sail designs done before that date may be copied exactly, while after that date the designers in a

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company may use the computer system and data bank of pre March 1982 date freely but must not put back into the system post March 1, 1982 information and must execute nationally independent sail designs [Rescinded May 15, 1984] (2) (3) A foreign designer—however he is designated—participating in the design of a boat or a sail would violate both the letter and spirit of the above Resolution, and any boat or sail so designed would be ineligible for use in America’s Cup competition. Similarly, a hull or sails which are merely copies of those of a foreign designer would also be ineligible for use in America’s Cup competition.

[Renumbered (2) May 15, 1984] Regardless of whether a challenge has been accepted by the Defending Club in the belief that a boat complies with the Deed of Gift and subsequent Interpretive Resolutions, such acceptance does not immunize the boat form being challenged as to eligibility by another Challenging Club.

Vincent Monte-Sano, II Secretary

Resolutions adopted by the America's Cup Committee of the Royal Perth Yacht Club on May 15, 1984 (The "First 1984 Resolutions") WHEREAS by resolution adopted July 15, 1980 and duly amended on March 9, 1982, to which Footnotes were included in amplification of such amendments (The "1982 Amendments") the then Board of Trustees noted that "The requirement that a person be a national will be satisfied if the person is domiciled in, or as a principal place of residence in, or had a valid passport of that country since January 1, 1982"; and WHEREAS such note, by its slated date, has been interpreted to apply to the 1983 Challenge Match only; and WHEREAS the 1987 and future Challenges for the America’s Cup would be better served by a definition which would be applicable to all challenges beyond the 1983 Challenge Match; and WHEREAS it is considered that two years provides a reasonable residential or documentary period for definition of a national; it is RESOLVED that Footnote (1) of the 1982 Amendments be, and the same hereby is rescinded; and RESOLVED that Footnote (1) of the 1982 Amendments be, and the same hereby replaced with the words "The requirement that a person be a national will be satisfied if the person has been domiciled in, or has had a principal place of residence in, or has had a valid passport of that country for no shorter period than the two years before the date of the first race of the applicable America’s Cup Match" [Amended July 1, 1990]; and RESOLVED that henceforth any reference to the Deed of Gift shall be deemed to include reference to these Resolutions, which shall hereafter be known as the "First 1984 Resolutions," and that whenever hereafter the Deed of Gift is printed or otherwise reproduced, as reproduced, the Second 1984 Resolutions shall be printed or reproduced as an integral part thereof.

D. Noel Robins Executive Director

Resolutions adopted by the America's Cup Committee of the Royal Perth Yacht Club on May 15, 1984 (The "Second 1984 Resolutions") WHEREAS by Resolution adopted July 15, 1980 and duly amended on March 9, 1982, to which Footnotes were included in amplification of such amendments (the "1982 Amendments") the then Board of Trustees noted that "Designers of sails my cooperate on an international basis until March 1, 1982; after which date, sail designers of different countries may not collaborate.

Sail designs done before that date may be copied exactly, while after that date the designers in a company may use the computer system and data bank of pre-March 1982 data freely but must not put back into the system post-March 1, 1982 information and must execute nationally independent sail design"; and WHEREAS because of the great increase in recent years in the exchange among the worlds’ sailmakers of technology, techniques, material and facilities for the design and construction of sails, due primarily to the greater accessibility of computerized systems and data banks; and WHEREAS restrictions on the freedom of this accessibility are no longer enforceable in a practical sense; and

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WHEREAS the purposes of the Deed of Gift cannot be furthered by the retention of the Footnote (2) of the 1982 Amendments; it is RESOLVED that Footnote (2) of the 1982 Amendments be, and the same hereby is, rescinded; and RESOLVED that Footnote (3) of the 1982 Amendments be, and the same hereby is renumbered "(2)"; and RESOLVED that henceforth any reference to the Deed of Gift shall be deemed to include reference to these Resolutions, which shall hereafter be known as the "Second 1984 Resolutions", and what whenever hereafter the Deed of Gift if printer or otherwise reproduced, the Second 1984 Resolutions shall be printed or reproduced as an integral part thereof.

D. Noel Robins Executive Director

Resolutions adopted by the America's Cup Committee of the Royal Perth Yacht Club on May 22, 1984 (The "Third 1984 Resolutions") WHEREAS, by Resolution adopted March 27, 1958, the then Board of Trustees interpreted the word "constructed" wherever it appears in the Deed of Gift of the America’s Cup shall always be construed as "designed and built"; and WHEREAS, by Resolutions adopted July 15, 1980, and amended March 9, 1982, the then Board of Trustees set forth its interpretation of the words both "designed" and "built" as they appeared in the 1958 Resolution; and WHEREAS, such interpretations of "designed" and "built" make no reference to testing and thereby leave doubt as to whether testing should be considered as part of the design process; and WHEREAS, the purpose of the Deed of Gift, particularly the provision thereof that the America’s Cup "shall be preserved as a perpetual Challenge Cup for friendly competition between foreign counties," will be furthered by a requirement that design testing should, where practicable, be carried out in the country of the club defending or challenging; and WHEREAS, certain yacht clubs which qualify under the Deed of Gift of the America’s Cup, and which yacht clubs are desirous of challenging for the America’s Cup, have raised the question as to whether their use of testing facilities closely aligned to the design process such as towing tanks would be accepted by the defending club if such testing facilities were located outside the country of the challenging club; it is RESOLVED, that the defending club at the instance of a challenging club, shall consider a request for permission to use towing tank facilities in any country other than that of the defending club, and may grant such permission should the defending club have evidence that adequate facilities do not exist in the country of the club requesting permission; and RESOLVED, that towing tank facilities in any country other than that of the defending club may be used for the defending club when similar evidence exists that adequate facilities do not exist in the country of the defending club; and RESOLVED, that henceforth any reference to the Deed of Gift shall be deemed to include reference to these Resolutions, which shall hereafter be known as the "Third 1984 Resolutions", and that whenever hereafter the Deed of Gift if printed or otherwise reproduced, the Second 1984 Resolutions shall be printed or reproduced as an integral part thereof.

D. Noel Robins Executive Director

Resolutions adopted by the Board of Directors of the San Diego Yacht Club on August 19, 1988 - (The "First 1988 Resolutions") [Rescinded October 30, 1991, as fully addressed in the subsequently issued San Diego Protocol]

WHEREAS, the expressed intent of the donors of the America’s Cup was that it should be a "perpetual Challenge Cup for friendly competition between foreign countries"; and WHEREAS, in accordance with that intent, the America’s Cup has evolved over the years into a multinational competition in which challenges are received from yacht clubs in a number of countries; and WHEREAS, the Deed of Gift of the America’s Cup provided that "when a challenge for a Club fulfilling all the conditions required by this instrument has been received, no other challenge can be considered until the pending event has been decided"; and

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WHEREAS, this provision could result in an unseemly and unsportsmanlike scramble among challenging yacht clubs, each seeking to be the first to deliver a notice of challenge following the conclusion of a match, and in the very real possibility of litigation between challengers to determine which was first; and WHEREAS, in recent years, the challengers for the America’s Cup have followed the practice of competing with each other in a Challenger Round of elimination races for the right to sail a match for the Cup; and WHEREAS, the organization and conduct of the Challenger Round, and the negotiation of the conditions of the match with the Defending Club, have been greatly facilitated by the designation of a representative challenger of Challenger of Record; and WHERAS, the San Diego Yacht Club, as holder of the America’s Cup and trustee under the Deed of Gift, is empowered to adopt resolutions interpreting the Deed so as to effectuate its purpose and the intent of the donors; NOW, THEREFORE, BE IT RESOLVED, that the trustee under the Deed of Gift shall designate a reasonable period of time following the conclusion or abandonment of a match, during which challenges shall be received for the Cup; and FURTHER RESOLVED, that all valid challenges received during such Challenge Period shall be deemed to have been received simultaneously, and shall be accepted; and FURTHER RESOLVED, that the Challenger of Record shall be empowered to act for the challengers whose challenges are so accepted as their representative in all matters pertaining to the match; and FURTHER RESOLVED, that the Challenger of Record shall organize and conduct a Challenger Round of elimination races preceding the match, in which all of the challengers whose challenges are so accepted shall be entitled to participate, and that the winner of the Challenger Round, if not the Challenger of Record, shall be substituted for the Challenger of Record, and shall be entitled to sail the match for the America’s Cup; and FURTHER RESOLVED, that the Defending Club and the Challenger of Record shall use their best efforts to reach agreement under the mutual consent provision of the Deed of Gift as to a design rul for the competing yachts of vessels, the number of races in the match, the configurations of the ocean courses for the match, the days of the races, and all other matters pertaining to the match; provided, that in the absence of such agreement, the yachts or vessels competing in the Challenger Round must conform to the rig and dimensions specified by the Challenger of Record in its notice of challenge, and the match will be a best of three series sailed on the ocean courses prescribed by the Deed of Gift on the days named by the Challenger of Record in its notice of challenge, all in strict accordance with the Deed of Gift; and FURTHER RESOLVED, that if a challenger whose challenge is so accepted, by written notice delivered to the trustee prior to the end of the Challenge Period; asserts that its challenger was the first valid challenge received during the Challenge Period, and such assertion is determined to be correct, and further asserts that such challenger refuses to consent to the foregoing interpretive resolutions, then it the absence of agreement between the Defending Club and such challenger under the mutual consent provision of the Deed of Gift, the match will be sailed between such challenger and the Defending Club in strict accordance with the Deed of Gift.

[Issued by C. Douglas Alford, Commodore. No signatures on original]

Resolutions adopted by the Board of Directors of the San Diego Yacht Club on August 19, 1988 - (The "Second 1988 Resolutions") [Rescinded October 30, 1991, as fully addressed in the subsequently issued San Diego Protocol.]

WHERAS, the Deed of Gift of the America’s Cup provides that "when a challenge from a club fulfilling all the conditions required by this instrument has been received, no other challenge can be considered until the pending event has been decided"; and WHEREAS, the manner and timing of receipt of challenges by the Defending Club should be clarified, so as to avoid confusion and possible litigation between challengers to determine which was first to deliver a notice of challenge for the America’s Cup. WHERAS, the San Diego Yacht Club, as holder of the America’s Cup and trustee under the Deed of Gift, is empowered to adopt resolutions interpreting the Deed so as to effectuate its purpose and the intent of the donors; NOW, THEREFOR, BE IT RESOLVED, a challenge shall not be considered unless it is received by the Defending Club after the winning yacht or vessel crosses the finish line in the final race of the match, or if there is a protest, after the protest is determined by the

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committee or jury appointed to hear and determine protests, or if the pending challenge is withdrawn or abandoned, after the fact of such withdrawal or abandonment is first publicly announced by the Defending Club; and FURTHER RESOLVED, that a challenge is received by the Defending Club only if an executed original notice of challenge is personally delivered to the Commodore of the club or mailed to the Commodore and received by the Club; and FURTHER RESOLVED, that a challenge is received by the Defending Club when it is actually personally delivered to the Commodore of the Club, or if mailed, at 5:00 p.m. local time on the day it is actually received by the Club.

[Issued by C. Douglas Alford, Commodore. No signatures on original.]

Resolution adopted by the Board of Directors of the San Diego Yacht Club on July 1, 1990 - (The "First 1990 Resolution") WHEREAS by Resolution adopted March 27, 1958 (the "1958 Resolution") The then Board of Trustees interpreted the word "constructed" as used in the Deed of Gift of the America’s Cup (the "Deed of Gift") to mean "designed or built"; and WHEREAS by Resolutions adopted July 15, 1980, and amended March 9, 1982, the then Board of Trustees set forth its interpretation of the words both "designed" and "built" as they appeared in the 1958 Resolution; and WHEREAS the fourth Resolution adopted by the then Board of Trustees on July 15, 1980 (hereafter "the Fourth 1980 Resolution") provided: "Notwithstanding the provisions of the foregoing resolution, any yacht which was eligible as a candidate for the America’s Cup Match in 1980 shall continue to be eligible thereafter provided that any material modification of the hull, rig or sails thereof shall be designed in accordance with the requirements of clause (a) of the foregoing resolution and any material modification of the hull thereof shall be completed in accordance with the requirements of clause (b) of the foregoing resolution"; and WHEREAS the Fourth 1980 Resolution was intended by the then Board of Trustees to apply only to the class of yacht then used in competition in the America’s Cup Match, namely, yachts of the International Twelve Metre Class; and WHEREAS the Deed of Gift provides that the club challenging for the Cup and the club holding the same may make any arrangement satisfactory to both as to rules; and WHEREAS on September 8, 1988, The San Diego Yacht Club, as Trustee under the Deed of Gift, issued a statement (the "San Diego Protocol", with which the two previous Trustees under the Deed of Gift concurred, by the terms of which a method for agreement upon the class of vessel to be used in the Twenty-eighth Defense of the America’s Cup (the "1992 Match") was identified; and WHEREAS all of the clubs challenging for the 1992 Match have agreed to be bound by the terms of the San Diego Protocol, and in accordance therewith have proposed, and the club holding the Cup has agreed to, competition in yachts of the new International America’s Cup Class for the 1992 Match; and WHEREAS yachts of the International Twelve Metre Class would be unable to comply with the rules of International America’s Cup Class; and WHEREAS if the challenging and defending clubs agree to the class of yacht to be used in a Match, the purposes of the Deed of Gift, particularly the provision thereof that the America’s Cup "shall be preserved as a perpetual Challenge Cup for friendly competition between foreign countries: , will be furthered by allowing competition only between yachts which comply with the rules of that class; it is RESOLVED that the Fourth 1980 Resolution be, and the same hereby is rescinded; RESOLVED that henceforth any reference to the Deed of Gift shall be deemed to include reference to this Resolution, which shall hereafter be known as the "First 1990 Resolution", and that whenever hereafter the Deed of Gift is printed or otherwise reproduced the First 1990 Resolution shall be printer or reproduced as an integral part thereof.

Resolutions adopted by the Board of Directors of the San Diego Yacht Club on July 1, 1990 - (The "Second 1990 Resolutions") WHEREAS a question has been raised on behalf of certain individuals, citizens of a foreign country, involved in a challenge for the

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America’s Cup, as to whether a person who satisfies the conditions of nationality for more than one country under the Resolutions interpreting the Deed of Gift my design a hull, rig, or sails, or participate as a crew member, for clubs located in different countries for the same America’s Cup, or any selection therefore; and WHEREAS by the 1958 Resolution the then Board of Trustees interpreted the word "constructed" wherever it appeared in the Deed of Gift to mean "designed" and "built"; and WHEREAS by the 1980 Resolutions and the 1982 Amendments, the then Board of Trustees set forth its interpretation of the words both "designed" and "built" as the appeared in the 1958 Resolution; and WHEREAS the Footnotes in amplification of the 1980 Resolutions (the "1982 Amendments" adopted March 9, 1982) stated; "A foreign designer—however he is designated—participating in the design of a boat or a sail would violate both the letter and the spirit of the above Resolution, and any boat or sail so designed would be ineligible for use in America’s Cup competition. Similarly, a hull or sails which are merely copies of those of a foreign designer would also be ineligible for use in America’s Cup competition."

WHEREAS by the 1980 Resolutions the then Board of Trustees also interpreted that for a candidate to be eligible for an America’s Cup Match in any year subsequent to 1980, every member of the candidate’s crew must be a national of the country in which the club represented by the candidate is located; and WHEREAS by inclusion of Footnote (1) of the 1982 Amendments, the then Board of Trustees noted that "The requirement that a person be a national will be satisfied if the person is domiciled in, or has a principal place of residence in, or has a valid passport of that country since January 1, 1982"; and WHEREAS Footnote (1), by its stated date, was thereafter interpreted to apply to the 1983 Challenge Match only; and WHEREAS by the First 1984 Resolutions, adopted May 15, 1984, the then Trustee determined that the 1987 and future Challenges for the America’s Cup would be better served by a definition of a "national" which would be applicable to all challenges beyond the 1983 Challenge Match, and that two years provides a reasonable residential or documentary period for definition of a "national", and replaced Footnote (1) of the 1982 Amendments with the words: "The requirement that a person be a national will be satisfied if the person has been domiciled in, or has had a principal place of residence in, or has had a valid passport of that country for no shorter period than the two years before the date of the first race of the applicable America’s Cup Match"; and WHEREAS because of the great increase in the popularity of the America’s Cup competition in recent years it has become customary for the yachts of the challenging clubs and the yachts of the club holding the Cup to engage in separate series of races to select the two yachts which will compete in the America’s Cup Match; and WHEREAS since the First 1984 Resolutions were adopted, challenging clubs have begun training and practice exercises in the country of the club holding the Cup sufficiently in advance of the relevant America’s Cup Match that crew members competing for challenging clubs may satisfy the conditions of nationality so as to compete on behalf of the defending club in the Match; and WHEREAS because the great increase in the popularity of the America’s Cup competition among clubs in foreign countries in recent years, the great increase in the number of foreign cubs for the Cup, and the prosperity experienced by various countries throughout the world, designers and crew members who are nationals of one country have begun changing their places of residence to other countries far enough in advance to satisfy the conditions of nationality to design or compete for clubs located in more than one country; and WHEREAS the original Deed of Gift dated July 8, 1857 and the second Deed of Gift dated January 4, 1882 each expressly provided, and the third and present Deed of Gift dated October 24, 1887, expressly provides, that the Cup should be "perpetually a Challenge Cup for friendly competition between foreign countries", and WHEREAS by the 1958 Resolution the then Board of Trustees determined that in accordance with the expressed intent of the donors of the America’s Cup and commencing with the first race for the Cup in 1870 to the date of the 1958 resolution every challenger had been both designed and constructed in the country of the defending Club so that every challenger and every defender had been in all respects truly representative of the countries of the challenging and defending club and the Cup had become by tradition the symbol of yachting supremacy of the country of the Club winning the challenge match; and

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WHEREAS the determination made by the 1958 Resolution is true to the present time, but unless declaration of nationality is required where a person satisfies the conditions of nationality for more than one country the expressed intent of the donors will be frustrated; and WHEREAS a question has been raised as to the appropriate method for determining the issues of eligibility of designers and members of a candidate’s crew; and WHEREAS the Deed of Gift expressly provides that the club challenging for the Cup and the club holding the same may, by mutual consent, make any arrangement satisfactory to both as to any and all conditions of the Match; and that in case the parties cannot mutually agree upon the teams of a Match, the races shall be sailed subject to the rules and sailing regulations of the club holding the Cup so far as the same do not conflict with the provisions of the Deed of Gift; and WHEREAS the Deed of Gift makes no other provision for determining the eligibility of designers and members of a candidate’s crew; and WHEREAS the context of the Resolutions may, on occasion, require reference to gender; it is RESOLOVED that Footnote (1) in amplification of the 1980 Resolutions, as amended May 15, 1984, be, and it hereby is, further amended to add the following second sentence: "However, no person may claim dual or multiple nationality. If a person satisfies the conditions of nationality for more than one country, he shall elect and declare a single nationality, and may participate only on behalf of the country whose nationality he declares", RESOLVED that for the 1992 America’s Cup Match, a designer who must declare nationality shall do so to the defending club as soon as reasonably practicable after July 31, 1990. The declaration shall include a statement that since July 31, 1990, he has designed only for the country whose nationality he had declared.

RESOLVED that a member of a candidate’s crew who must declare a nationality shall do so to the defending club prior to the start of the challenger or defender selection series, as appropriate.

RESOLVED that a question as to a person’s eligibility shall be referred to the challenging club (or, if there is more than one challenging club, then to the duly elected or appointed Challenger of Record, or Committee elected by the challengers and approved by the defending club, as applicable) and the defending club for agreement. If they cannot agree, the question shall be referred to the appropriate authority under the rules and sailing regulations of the club holding the Cup. RESOLVED that for purposed of the Resolutions interpreting the Deed of Gift, the masculine gender used includes the feminine; RESOLVED that henceforth any reference to the Deed of Gift shall be deemed to include reference to these Resolutions, which shall hereafter be known as the "Second 1990 Resolutions", and that whenever hereafter the Deed of Gift is printed or otherwise reproduced, the Second 1990 Resolutions shall be printed or reproduced as an integral part thereof.

William R. Munster Secretary

The Interpretive Resolutions adopted by the Trustees Consolidated as of October 1, 1990

Resolution adopted March 27, 1958 The word "constructed" wherever it appears in the Deed of Gift of the America’s Cup shall always be construed as "designed and built".

Resolutions adopted July 15, 1980 For the purposes of the 1958 Resolution:

A yachts shall be deemed to be "designed" in a country if the designers of the yacht’s hull, rig and sails shall be national of that country; and A yacht shall be deemed to be "built" in a country if the hull of the yacht, including all framing and all planking, plating or other form of surfacing of the hull, shall be fabricated and assembled, and if the yacht’s sails shall be manufactured, in that country; provided that the foregoing provisions of this clause (b) shall not prevent the modification of the hull of any challenger, or candidate to be challenger, for the Cup, or the manufacture of sails for such challenger or the candidate in the country in which an America’s Cup Match is to take place so long as the modification or manufacture (i) is effected when the challenger or candidate is in

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such country and (ii meets the requirements of clause (a) above. For a candidate to be eligible for an America’s Cup Match in any year subsequent to 1980, every member of the candidate’s crew must be a national of the country in which the club represented by the candidate is located.

Footnotes in Amplification of the July 15, 1980 Resolutions, including the Amendments of May 15, 1984 AND July 1, 1990 The requirement that a person be a national will be satisfied if the person has been domiciled in, or has had a principal place of residence in, or has had a valid passport of that country for no shorter period than the two years before the date of the first race of the applicable America’s Cup Match. However, no person may claim dual or multiple nationality. If a person satisfies the conditions of nationality for more than one country, he shall elect and declare a single nationality, and may participate only on behalf of the country whose nationality he declares. A foreign designer—however he is designated—participating in the design of a boat or a sail would violate both the letter and spirit of the above resolution, and any boat or sail so designed would be ineligible for use in America’s Cup competition. Similarly, a hull or sails which are merely copies of those of a foreign designer would also be Regardless of whether a challenge has been accepted by the Defending Club in the belief that a boat complies with the Deed of Gift and subsequent Interpretive Resolutions, such acceptance does not immunize the boat from being challenged as to eligibility by another Challenging Club.

Resolutions adopted May 22, 1984 The defending club at the instance of a challenging club, shall consider a request for permission to use towing tank facilities in any country other than that of the defending club, and may grant such permission should the defending club have evidence that adequate facilities do not exist in the country of the club requesting permission.

Towing tank facilities in any country other than that of the defending club may be used by the defending club when similar evidence exists that adequate facilities do not exist in the country of the defending club.

Resolutions adopted July 1, 1990 For the 1992 America’s Cup Match, a designer who must declare a nationality shall do so to the defending club as soon as reasonably practicable after July 31, 1990. The declaration shall include a statement that since July 31, 1990, he had designed only for the country whose nationality he has declared.

A member of a candidate’s crew who must declare a nationality shall do so to the defending club prior to the start of the challenger or defender selection series, as appropriate.

A questions as to a person’s eligibility shall be referred to the challenging club (or, if there is more than one challenging club, then to the duly elected or appointed Challenger of Record, or Committee elected by the challengers and approved by the defending club, as applicable: and the defending club for agreement. If they cannot agree, the question shall be referred to the appropriate authority under the rules and sailing regulations of the club holding the Cup. For purposes of the Resolutions interpreting the Deed of Gift, the masculine gender used includes the feminine.

Resolution adopted by Unanimous Consent of the Board of Directors of the San Diego Yacht Club on April 9, 1993 - (The "First 1993 Resolution") [Rescinded December 19, 1996]

WHEREAS by Resolution adopted March 27, 1958, the then Board of Trustees interpreted the word "constructed" wherever it appears in the Deed of Gift of the America’s Cup shall always be construed as "designed and built"; and WHEREAS by Resolutions adopted July 15, 1980, and amended March 9, 1982, and May 15, 1984, the then Board of Trustees set fourth its interpretation of the words both "designed" and "built" as they appear in the 1958 Resolutions; and WHEREAS the development and use of computer software programs for analysis, design and optimization is by now widely acknowledged to be essential to the design process; and

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WHEREAS yachts designed with the assistance of these software programs can be superior to those designed with the unaided judgement of a skilled yacht designer; and WHEREAS restrictions regarding the location of the software itself are unenforceable and irrelevant in an age of electronic data communication; it is RESOLVED that for purposes of the 1980 Resolutions, the "designers of the yacht’s hull, rig and sails" shall be deemed to include those who are developing modifying or using; computational fluid dynamics software which simulates the flow of air or water past the yacht, its sails or rig in order to characterize or compute forces in the presence of that flow; or velocity prediction software which based on the forces of a yacht, rig and sails caused by a given wind or waves, predicts the yacht’s behavior or performance; or finite element analysis software for structural engineering; or software which is capable of optimizing one or several characteristic of a yacht, rig or sails given certain objectives and constraints; and RESOLVED that henceforth any reference to the Deed of Gift shall be deemed to include reference to these Resolutions, which shall hereafter be known as the "First 1993 Resolutions", and that whenever hereafter the Deed of Gift is printed or otherwise reproduced, the First 1993 Resolutions shall be printed or reproduced as an integral part thereof.

ADOPTED BY UNANIMOUS CONSENT OF THE BOARD OF DIRECTORS OF SAN DIEGO YACHT CLUB ON APRIL 9, 1993.

G. Wytie Cable Commodore

Resolutions adopted by the Flag Officers and General Committee of the Royal New Zealand Yacht Squadron on December 19, 1996 - (The "1996 Resolution") WHEREAS, by Resolution adopted March 27, 1958 (the "1958 Resolution") the then Board of Trustees determined that the word "constructed" wherever it appears in the Deed of Gift of the America’s Cup shall always be construed as "designed and built"; WHEREAS, by Resolutions adopted July 15, 1980, and amended March 9, 1982, May 15, 1984, and July 1, 1990, the then Board of Trustees set forth their interpretation of the words both "designed" and "built" as they appeared in the 1958 Resolution and in so doing made reference to "designers"; and WHEREAS, by Resolutions adopted May 22, 1984 (the "Third 1984 Resolutions") the then Board of Trustees set forth conditions whereby participating clubs in the America’s Cup might use towing tank facilities and noted that where practicable design testing should be carried out in the country of the club defending or challenging; and WHEREAS, the Third 1984 Resolutions govern only the use of towing tank facilities and do not address the use of other aids to design such as computer software and various other types of testing facilities; and WHEREAS, by Resolution adopted April 9, 1993 (the "First 1993 Resolution") the then Trustee set forth its interpretation of those persons who were to be considered "designers"; and WHEREAS, the First 1993 Resolution is unworkable; and WHEREAS, the purposes of the Deed of Gift, particularly in provision thereof that the America’s Cup "shall be preserved as a perpetual Challenge Cup for friendly competition between foreign countries" and the purposes of the various Interpretive Resolutions particularly those governing nationality eligibility, will be furthered by a clarification of who shall be considered a "designer"; it is RESOLVED that the First 1993 Resolution be, and the same hereby is rescinded; and RESOLVED that a designer in relation to a yacht, its hull, rig, appendages and sails, is any person who applies or who has applied substantial intellectual creativity and/or judgement to the determination of the shape and/or structure of that yacht, its hull, rig appendages or sails. A person shall not be considered to apply or to have applied substantial intellectual creativity and/or judgement to the determination of the shape and/or structure of a yacht, its hull, rig, appendages, or sails if that person merely develops, modifies, operates, or provides instructions for the use of or the interpretation of any data or information created by, any machine, tool, instrument, device or apparatus including, but without limitation, computer software, towing tank facilities or sail testing facilities, which may be used to assist in that determination. With the exception of towing tank facilities the use of which is governed by the Third 1984 Resolutions, and wind tunnel facilities the use of which is governed by the Third 1984 Resolutions as amended by these resolutions, such computer software and/or facilities may be used without regard to nationality; and

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RESOLVED that the Third 1984 Resolutions be amended by adding the words "and/or wind tunnel facilities" after the words "towing tank facilities" in each of the first and second resolutions but otherwise the same hereby are ratified and confirmed.

RESOLVED that the 1958 Resolution and the Resolutions adopted on July 15, 1980 as amended March 9, 1982, May 15, 1984 and July 1, 1990 be and the same hereby ratified and confirmed; and RESOLVED that henceforth any reference to the Deed of Gift shall be deemed to included reference to these resolutions which shall hereafter be known as "The 1996 Resolutions" and that whenever hereafter the Deed of Gift is printed or otherwise reproduced the 1996 Resolutions shall be printed or otherwise reproduced as an integral part thereof.

William John Heise Commodore Royal New Zealand Yacht Squadron

Resolution Regarding a PROTOCOL Governing The Thirty Second Americas Cup (Amended January 21, 2004) [This 1988 document presented a San Diego Yacht Club-sponsored mechanism to resolve certain disputes between a Defender and Challenger(s). The five (5) Decisions resolved by the ”Trustees’ Committee” are found following the Protocol] PROTOCOLS FOR ALL SUBSEQUENT YEARS CAN BE FOUND IN “THE RULES” SECTION OF Compendium.

San Diego Yacht Club believes that a mechanism for the resolution of disagreements between the Defending Yacht Club and the Challenging Yacht Clubs without resort to litigation is highly desirable, Toward that end, San Diego Yacht Club had consulted with the former trustees of the America’s Cup, New York Yacht Club and Royal Perth Yacht Club, as to the establishment of a Trustees’ Committee composed of a representative appointed by each of the three clubs which, if San Diego Yacht Club is the defender for the America’s Cup XXVIII, would be empowered, as more particularly set forth below: (a) To resolve disputes between participants in America’s Cup XXVIII other than disputes concerning the racing rules or any applicable class or rating rule; (b) In the event of disagreement among challengers, to designate the Challenger of Record; (c) In the event of disagreement between the San Diego Yacht Club and the Challenger of Record, to determine the mutual consent matters identified below.

San Diego Yacht Club therefore resolves: 1. Should San Diego Yacht Club successfully defend the America’s Cup in America’s Cup XXVII, the club will accept all bona fide notices of challenge from qualified foreign yacht clubs delivered within 60 days of the conclusion of the present race series, and such challenges will be deemed to have been received at the same time. Such period shall be known as the “Challenge Period”. If there is more than one such challenge, San Diego Yacht Club will, within 48 hours following the Challenge Period, appoint one of the Challenging Yacht Clubs to convene a meeting of the challengers to elect a Challenger of Record, and the provision of paragraphs 2. and 3, shall apply.

2. The Challenging Yacht Clubs shall elect a Challenger of Record and notify San Diego Yacht Club of such election within 32 days following the Challenge Period, which following period shall be known as the “Challenge of Record Period”. If such election, each Challenging Yacht Club shall have one vote. If any one yacht owner, or party related thereto, is involved in more than one challenge, that owner or party shall be excluded from being represented in such election by more than one yacht club. If the challengers are unable to elect a Challenger of Record within the Challenge of Record Period, the Trustees’ Committee shall appoint the Challenger of Record within seven days.

3. Within 45 days following the Challenge of Record Period, the Challenger of Record shall submit to the San Diego Yacht Club the class of vessel nominate by the challengers to be used by both the challenges and the defender for America’s Cup XXVIII and the challengers’ proposals for the dates, the number of races and the types of course for America’s Cup XXVIII (hereinafter “the four mutual consent items. Should San Diego Yacht Club not concur with eh challengers’ proposals regarding one or more of the four mutual consent items, San Diego Yacht Club and the challenger of Record will attempt to resolve any differences through negotiations. If the negotiations are not successful, the Trustees’ Committee shall, on the 46th day following the Challenge of Record

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Period, commence a mediation of all unresolved mutual consent issues. If such mediation is unsuccessful, the Trustees’ Committee shall, within 90 days following the Challenge of Record Period, decide the unresolved issues by choosing between the respective proposals submitted to the committee by San Diego Yacht Club and the Challenger of Record.

4. The Challenger of Record shall organize and conduct a Challenger Round of elimination races preceding the match, in which all of the challengers whose challenges are so accepted shall be entitled to participate. The winner of the Challenger Round, if not the Challenger of Record shall be substituted for the Challenger of Record and be entitles to sail the match of the America’s Cup. 5. It is the preference of the San Diego Yacht Club that America’s Cup XXVIII be held on approximately May 1, 1991, in the waters of the Pacific Ocean off San Diego, California; provided the match will be held no earlier than 24 months after the conclusion of all proceedings, including any legal proceedings relating to America’s Cup XXVII. (see Note next page) 6. In addition to all other requirements presently existing under the Deed of Gift, all challengers for America’s Cup XXVIII shall be required to undertake that they will be bound by the conditions specified in this statement.

7. Depending upon the experience received from the implementation of the above challenge procedures of America’s Cup XXVIII, it is the intent of Sand Diego Yacht Club, Royal Perth Yacht Club and New York Yacht Club to consider an application to the New York Supreme Court to have the Deed of Gift amended substantially as set forth above.

SAN DIEGO YACHT CLUB C. Douglas Alford Commodore The undersigned concur with the above provisions and agree to participate in the Trustees’’ Committee provided for therein.

NEW YORK YACHT CLUB Frank V. Snyder

ROYAL PERTH YACHT CLUB OF WESTERN AUSTRALIA (INC.) Peter G. Johnson

Commodore

Official Representative of the Royal Perth Yacht Club to America’s Cup XXVII

Witnesses: William B. Packer

Alan Bond, A. O.

Note: the final decision of the Court of Appeals of the State of New York upholding the validity of San Diego Yacht Club’s 1988 Defense of the Cups was not rendered until April 07, 1990, thereby delay in the next Match until April 27, 1990, thereby delaying the next match until 1992. Because a match cannot be held in the Northern Hemisphere until after May 1 in any year (see Deed of Gift and Southern Hemisphere Amendment), it was agreed that the 1992 Match would begin May 9.

DECISION #1 March 1, 1991 The Trustees Committee convened at the request of the San Diego Yacht Club Trustee to determine if the committee had the authority to hear an appeal from a challenging yacht club regarding a disputed decision made by the defending yacht club, The Trustees’ Committee find that in accordance with paragraph (a) of the San Diego Protocol dated 8 September 1988, that they have the authority.

Commodore W. H. Dyer Jones, Chairman New York Yacht Club

Mr. Warren Jones Royal Perth Yacht Club

Commodore H. P. “Sandy” Purdon San Diego Yacht Club

DECISION #2 March 3, 1991 At its initial Meeting the Trustees’ Committee has resolved that it is preferable: 1. That all disputed between participants be referred to the Trustees’ Committee by either the San Diego Yacht Club Trustee, the America’s Cup Organizing Committee and/or the Challenger or Record Committee.

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2. That in the instance of the Challenger of Record Committee, their authority mut be defined on each issue by a majority vote of the challenging clubs and all challenging clubs shall be bound by the decision of the Trustees’ Committee.

3. That in accordance with mutual consent between America’s Cup Organizing Committee and the Challenger of Record Committee both parties will be represented each time the Trustees’ Committee hears disputes between America’s Cup Organizing Committee and the Challenger of Record Committee.

4. That all decisions of the Trustees’ Committee will be given to the San Diego Yacht Club Trustee, the America’s Cup Organizing Committee and the Challenger of Record Committee simultaneously.

Commodore W. H. Dyer Jones, Chairman New York Yacht Club

Mr. Warren Jones Royal Perth Yacht Club

Commodore H. P. “Sandy” Purdon San Diego Yacht Club

DECISION #3 March 3, 1991 The Trustees’ Committee convened at the request of both the America’s Cup Organizing Committee and the Challenger of Record Committee to resolve two issues brought to the Trustees’ Committee under paragraph (a) of the San Diego Protocol dated 8 September, 1988.

Firstly, the America’s Cup Organizing Committee asked the question: “May a challenger name its yacht later than ten months prior to the match?”

The Trustees’ Committee refers to the Deed of Gift which specifically requires mutual consent before the 10 months’ notice may be waived.

Secondly, the Challenger of Record Committee has requested a decision as to whether or not it is required for the final challenging club to compete in the Match with the same yacht it uses in the Challenger Series.

The Trustees’ Committee finds that under the mutual consent clause of the Deed of Gift, the America’s Cup Organizing Committee and the Challenger of Record Committee are drafting conditions for the 28th Match. The Parties have accepted the International America’s Cup Class yacht for the Match, thereby satisfying certain requirements of the Deed.

Given that by mutual consent there are multiple challengers and that several challengers may each build more than one International America’s Cup Class yacht, there remains the question of when each challenger will identify “the challenging vessel” for which, under the Deed of Gift, 10 months’ notice is required.

By mutual consent the parties may agree that the 10 months’ notice be waived for the purpose of identifying “the challenging vessel” of each challenger.

Therefore, once a challenging yacht club has declared “the challenging vessel,” at the notice date yet to be mutually consented, that vessel must then represent the challenging yacht club throughout the challenger series and, if representing the winning yacht club, in the 28th Match.

Unless mutually consented, it is not possible to substitute “the challenging vessel” at any time.

Commodore W. H. Dyer Jones, Chairman New York Yacht Club

Mr. Warren Jones Royal Perth Yacht Club

Commodore H. P. “Sandy” Purdon San Diego Yacht Club

DECISION #4 March 4, 1991 The Trustees’ Committee was convened at the request of the America’s Cup Organizing Committee and the Challenger of Record Committee under the terms of the San Diego Protocol dated 8 September 1988, in order to resolve a dispute regarding a decision by the San Diego Yacht Club Trustee on an application by the Italian yacht Club Compagnia della Vela to conduct foreign wave testing.

After considering submissions from America’s Cup Organizing Committee, representing the San Diego Yacht Club Trustee, and the Challenger of Record Committee, representing the challenger, the Trustees’ Committee finds the decision made under the “Third 1984 Resolution” by the defending club is valid as it was within the authority of that club to make such a decision.

Commodore W. H. Dyer Jones, Chairman New York Yacht Club

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DECISION #5 October 16, 1991 The Trustees’ Committee convened at the request of the Challenger of Record Committee, representing the Challenging Yacht Clubs for the 28th Match; and America’s Cup Organizing Committee, representing the San Diego Yacht Club.

The meeting was called in accordance with the San Diego Protocol dated 8 September 1988, to resolve a point on which CORC and ACOC have not been able to reach agreement in drafting the Match Conditions for the 28th Match, The point in dispute is the date by or on which each Challenging Club must identify the yacht which will represent that Club should it become the final Challenging Club.

The Trustees’ Committee find that: 1. The “four mutual consent items” referenced in paragraph 3 of the San Diego Protocol have been agreed to by the America’s Cup Organizing Committee and the Challenger of Record Committee.

2. By agreeing to the International America’s Cup Class more than ten months before the match, the parties have satisfied the intent of paragraph 6 of the Deed of Gift in that the Defending Club knows the type of vessel representing each challenger and her limiting dimensions.

3. The requirement that a custom house registry be sent “as soon as possible” recognizes that a yacht may not be built or measured 10 months prior to the match.

4. The parties have mutually consented to the use of the IACC Measurement Certificate for the purpose of identifying a specific yacht.

5. The ACOC & CORC have agreed to a series of Challenger Selection races to determine the final Challenging Club. These races will begin on 25 January 1992. They have also agreed that the Defending Club will be advised of the final Challenging Club on or before 4 May 1992.

6. In Trustees; Committee Decision #3, dated March 3, 1991, the Committee found that once a challenging club has identified its yacht, that yacht may not be substituted with another. That decision did not set a date for identifying the challenging vessel but encouraged ACOC & ORC to set a mutually acceptable date for that identification.

Such agreement has not been reached.

7. There is no compelling reason that a challenger must identify its yacht of the International America’s Cup Class prior to the beginning of the Challenger Selection Series.

Therefore, by majority vote, the Trustees’ Committee rules that in respect to the 28th Match each Challenging Club shall be required to identify ”the Challenging Vessel” which will represent that Club at the notice date of 1700 hours on January 24, 1992.

Providing a copy of the front page of the yacht’s valid IACC Measurement Certificate shall be the appropriate means of identifying ”the challenging vessel.”

October 16, 1991 Commodore W. H. Dyer Jones, Chairman New York Yacht Club

Mr. Warren Jones Royal Perth Yacht Club

Commodore H. P. “Sandy” Purdon San Diego Yacht Club

Amendment to Article 9 of Resolution Regarding a Protocol Governing The Thirty Second Americas Cup (January 21, 2004) Article 9. INTERPRETIVE RESOLUTIONS The Trustee Interpretive Resolutions require updating to take into account contemporary circumstances. The content of such Resolutions have been considered and, where appropriate, addressed by mutual consent in this Protocol. All Trustee Interpretive Resolutions including those in effect as at the end of the last race of the 31st America’s Cup match (2 March 2003) have no further effect for any purpose whatsoever.

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ASSIGNMENTS and ACCEPTANCE OF THE AMERICA’S CUP GEORGE L. SCHUYLER TO NEW YORK YACHT CLUB (July 8, 1857) CUP WON BY YACHT “AMERICA” Assignment and Acceptance “On motion of Mr. Grinnell, it was Resolved, That the New York Yacht Club accept the Cup won by the “America” and presented to them by the proprietors, upon the terms and conditions appointed by them.

Resolved, That the letter of Mr. Schuyler, with the inclosure (sic), to be entered on the minutes, and the Secretary be requested to furnish to all foreign yacht clubs a copy of the conditions upon which this Club holds the Cup and which permanently attach to it.

Adjourned, N. Bloodgood, Secretary.

July 8, 1857” “New York Attachment: Letter of Mr. Schuyler “July 8, 1857 To the Secretary of the New York Yacht Club.

Sir, The undersigned members of the New York Yacht Club, and late owners of the schooner yacht America, beg leave through you to present to the Club the Cup won by the America at the Regatta of the Royal Yacht Squadron at Cowes, England, August 22, 1851.

This Cup was offered as a prize to be sailed for by yachts of all nations without regard to difference of tonnage, going round the Isle of Wight, the usual course for the Annual Regatta of the Royal Yacht Squadron, and was won by the America, beating eight cutters and seven schooner yachts which started in the race. This Cup is offered to the New York Yacht Club, subject to the following conditions: Any organized Yacht Club of any foreign country shall always be entitled, through any one or more of its members, to claim the right of sailing a match for this Cup with any yacht or other vessel of not less than 30 or more than 300 tons, measured by the Custom House rule of the country to which the vessel belongs. The parties desiring to sail for the Cup may make any match with the Yacht Club in possession of the same that may be determined upon by mutual consent; but in case of disagreement as to terms, the match shall be sailed over the usual course for the Annual Regatta of the Yacht Club in possession of the Cup, and subject to its Rules and Sailing Regulations—the challenging party being bound to give six months' notice in writing, fixing the day they wish to start. This notice to embrace the length, Custom House measurement, rig and name of the vessel.

It is to be distinctly understood that the Cup is to be the property of the Club, and not of the members thereof, or owners of the vessels winning it in a match; and that the condition of keeping it open to be sailed for by Yacht Clubs of all foreign countries, upon the terms above laid down, shall forever attach to it, thus making it perpetually a Challenge Cup for friendly competition between foreign countries.

J. C. Stevens Edwin A. Stevens Hamilton Wilkes J. Beekman Finley George L. Schuyler”

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New York Yacht Club’s Invitation to Eighteen Foreign Yacht Clubs (July 20, 1857) The following is the letter from the NYYC to the eighteen primary international yacht clubs operating in 1857, announcing the challenge to the Yachts of All Nations

New York Yacht Club New York, U. S. A July 20th, 1857 To: Sir, I am directed to inform the members of your Association, that the One Hundred Guinea Cup, won by the Yacht America at Cowes, England, August 22d, 1851, at the Regatta of the Royal Yacht Squadron, as a prize offered to Yachts of all nations, have been presented to the New York Yacht Club, subject to the following conditions, viz.: “Any organized Yacht Club of any foreign country shall always be entitled to, through any one or more of its members, claim the right of sailing a match for this Cup, with any Yacht or other vessel, not less than thirty or more than three hundred tons, measured by the Custom House rule of the country to which the vessel belongs.

“The parties desiring to sail for the Cup may make any match with the Yacht Club in possession of the same that may be determined upon by mutual consent; but in case of disagreement as to terms, the match shall be sailed over the usual course for the Annual Regatta of the Yacht Club in possession of the Cup, and subject to its rules and sailing regulations; the challenging party being bound to give six months’ notice in writing, fixing the day they wish to start - this notice to embrace the length, Custom House measurement, rig and name of the vessel.

“It is to be distinctly understood that the Cup is to be the property of the Club, and not of the members thereof, or owners of the vessel winning it in a match, and that the condition of keeping it open to be sailed for by Yacht Clubs of all foreign countries, upon the terms above laid down, shall for ever attach to it, thus making it perpetually a Challenge Cup for friendly competition between foreign countries.”

The New York Yacht Club, having accepted the gift, with the conditions above expressed, consider this a fitting occasion to present the subject to the Yacht Clubs of all nations, and invoke from them a spirited contest for the Championship, and trust that it may be the source of continued friendly strife between the institutions of this description throughout the world, and therefore request that this communication may be laid before your members at their earliest meeting, and earnestly invite a friendly competition for the possession of the prize, tendering to any gentleman who may favor us with a visit, and who may enter into the contest, a liberal, hearty welcome and the strictest fair play.

Respectfully, Your O’bt Servant, N. BLOODGOOD Secretary, New York Yacht Club

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NEW YORK YACHT CLUB TO ROYAL PERTH YACHT CLUB (September 27, 1983) [Issued for the first legal transfer of the Cup from NYYC to RPYC following the loss of the America’s Cup to Australia in September 1983. Document provides for continuation of the provisions of the Deed of Gift.]

AMERICA’S CUP Assignment and Acceptance This Assignment and Acceptance is made as of the 27th day of September 1983, by and between the New York Yacht Club (the “NYYC”) and the Royal Perth Yacht Club of Western Australia (RPYC).

The yacht AUSTRALIA II, as representative of the RPYC, having won the America’s Cup (the “Cup”) in accordance with the terms and conditions of a deed of gift dated October 24, 1887, between George L. Schuyler and the NYYC, as amended by an order of the Supreme Court of the State of New York date December 17, 1956 and as interpreted by resolutions adopted by the Board of Trustees of the NYYC on March 27, 1958 and by resolutions adopted by the Board of Trustees of the NYYC on July 15, 1980 and amended on March 9, 1982, and the Footnotes in Amplification thereof published by the NYYC, such deed of gift as so amended and interpreted being herein referred to as the “Deed of Gift”, the parties hereto agree that: 1. Assignment. The NYYC hereby assigns and transfers the Cup to the RPYC on the condition that the RPYC shall hold the Cup, in trust, in accordance with the terms and conditions of the Deed of Gift.

2. Acceptance. The RPYC hereby accepts the Cup subject to the said trust and to the terms and conditions of the Deed of Gift and covenants that: (a) it will faithfully and fully see that the conditions of the Deed of Gift are fully observed and complied with by any contestant for the Cup during the holding thereof by it; and (b) it will assign, transfer and deliver the Cup to the foreign yacht club whose representative shall have won the same in accordance with the terms and conditions of the Deed of Gift, provided that said foreign club shall, by instrument in writing lawfully executed, enter with the RPYC into the like covenants as are herein entered into by it, such instrument to contain a like provision for the successive assignees to enter into the same covenants with their respective assignors, and such instrument to be executed in duplicate, with one counterpart to be retained by each club and a copy thereof to be forwarded to the NYYC. 3. Applicable Law. The parties hereto further agree that, the trust under which the Cup is held having been created under the laws of the State of New York, and having been amended as aforesaid by order of the Supreme Court of the State of New York, the terms and conditions of the Deed of Gift shall be governed by, and construed in accordance with, such laws, and any proceedings for the amendment or interpretation of such terms and conditions shall be brought before the courts of the State of New York.

IN WITNESS THEREOF, the parties have caused this instrument to be executed by their duly authorized officers as of the date first above written.

Witness Donald B. Kipp

NEW YORK YACHT CLUB

by Robert G. Stone, Jr. Commodore

Witness H. S. Lodge

ROYAL PERTH YACHT CLUB OF WESTERN AUSTRALIA

by P. R. Dalziell, Commodore

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ROYAL PERTH YACHT CLUB to SAN DIEGO YACHT CLUB (February 5, 1987) [Issued for the second legal transfer of the Cup from RPYC to SDYC following the loss of the America’s Cup to United States in September 1987. Document provides for continuation of the provisions of the Deed of Gift.]

ASSIGNMENT AND ACCEPTANCE ROYAL PERTH YACHT CLUB – SAN DIEGO YACHT CLUB THE ASSIGNMENT BY THE ROYAL PERTH YACHT CLUB OF THE AMERICA’S CUP AND ITS ACCEPTANCE

BY THE SAN DIEGO YACHT CLUB, DATED 5 FEBRUARY 1987.

This Assignment and Acceptance is made as of the 5th day of February 1987, by and between the ROYAL PERTH YACHT CLUB OF WESTERN AUSTRALIA (INC.) (the “RPYC”) and the SAN DIEGO YACHT CLUB (“the SDYC”).

The yacht STARS AND STRIPES, as representative of the SDYC, having won the America’s Cup (the “Cup”) in accordance with the terms and conditions of a deed of gift dated October 24, 1887, between George L. Schuyler and the New York Yacht Club (the “NYYC”), amended by orders of the Supreme Court of the State of New York dated December 17, 1956, September 20, 1984 and April 5 1985, and as interpreted by resolutions adopted by the respective holders of the Cp on March 27, 1958 (the “1958 Resolution”), July 15, 1980 (the “1980 Resolution”), March 9, 1982 (the “1982 Amendments”), May 15, 1984 (the “First 1984 Resolutions” and “Second 1982 Resolutions” ) and May 22, 1984 (the “Third 1984 Resolutions”) and the Footnotes in Amplification, as amended, of the 1980 Resolutions and the 1982 Amendments to such deed of gift so amended as interpreted being herein referred to as the “Deed of Gift.” The parties hereto agree that: 1.

Assignment. The RPYC hereby assigns and transfers the Cup to the SDYC on the condition that the SDYC shall hold the Cup, in trust, in accordance with the terms and conditions of the Deed of Gift.

2.

Acceptance. The SDYC hereby accepts the Cup subject to the said trust and to the terms and conditions of the Deed of Gift and covenants that: (a) it will faithfully and fully see that the conditions of the Deed of Gift are fully observed and complied with by any contestant for the Cup during the holding thereof by it; and (b) it will assign, transfer and deliver the Cup to the foreign yacht club whose representative yacht shall have won the same in accordance with the terms and conditions of the Deed of Gift, provided that said foreign yacht club shall, by instrument in writing lawfully executed, enter with the SDYC into the like covenants as are herein entered into by it, such instrument to contain a like provision for the successive assignees to enter into the same covenants with their respective assignors, and such instrument to be executed in duplicate, with one counterpart to be retained by each club and a copy thereof to be forwarded to the NYYC. 3.

Applicable Law. The parties hereto further agree that, the trust under which the Cup is held having been created under the laws of the State of New York, and having been amended as aforesaid by order of the Supreme court of the State of New York, the terms and conditions of the Deed of Gift shall be governed by, and construed in accordance with, such laws, and any proceeding for the amendment or interpretation of such terms and conditions shall be brought before the courts of the State of New York.

IN WITNESS WHEREOF, the parties have caused this instrument to be executed by their duly authorized officers as of the date first above written.

SAN DIEGO YACHT CLUB

By Fredrick A. Frye Commodore ROYAL PERTH YACHT CLUB OF WESTERN AUSTRALIA (INC.)

by Alan D. Crewe Commodore

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SAN DIEGO YACHT CLUB to ROYAL NEW ZEALAND YACHT SQUADRON (May 22, 1995) [Issued for the third legal transfer of the Cup from SDYC to RNZYS following the loss of the America’s Cup to United States in May 1995. Document provides for continuation of the provisions of the Deed of Gift.]

ASSIGNMENT AND ACCEPTANCE SAN DIEGO YACHT CLUB – ROYAL NEW ZEALAND YACHT SQUADRON THE ASSIGNMENT BY THE SAN DIEGO YACHT CLUB OF THE AMERICA’S CUP AND ITS ACCEPTANCE

BY THE ROYAL NEW ZEALAND YACHT SQUADRON, DATED 22 MAY 1995.

This Assignment and Acceptance is made as of the 22 day of May 1995, by and between the SAN DIEGO YACHT CLUB (“the SDYC”).

And the ROYAL NEW ZEALAND YACHT SQUADRON (the “RNZYS”).

The yacht, NZL 32, as representative of the RNZYS, having won the America’s Cup (the “Cup”) in accordance with the terms and conditions of a deed of gift dated October 24, 1887, between George L. Schuyler and the New York Yacht Club (the “NYYC”), amended by orders of the Supreme Court of the State of New York dated December 17, 1956, September 20, 1984 and April 5 1985, and as interpreted by resolutions adopted by the respective holders of the Cp on March 27, 1958 (the “1958 Resolution”), July 15, 1980 (the “1980 Resolution”), March 9, 1982 (the “1982 Amendments”), May 15, 1984 (the “First 1984 Resolutions” and “Second 1982 Resolutions” ) and May 22, 1984 (the “Third 1984 Resolutions”) and the Footnotes in Amplification, as amended, of the 1980 Resolutions and the 1982 Amendments to such deed of gift so amended as interpreted being herein referred to as the “Deed of Gift.” The parties hereto agree that: 1.

Assignment. The SDYC hereby assigns and transfers the Cup to the RNZYS on the condition that the RNZYS shall hold the Cup, in trust, in accordance with the terms and conditions of the Deed of Gift.

2.

Acceptance. The RNZYS hereby accepts the Cup subject to the said trust and to the terms and conditions of the Deed of Gift and covenants that: (a) it will faithfully and fully see that the conditions of the Deed of Gift are fully observed and complied with by any contestant for the Cup during the holding thereof by it; and (b) it will assign, transfer and deliver the Cup to the foreign yacht club whose representative yacht shall have won the same in accordance with the terms and conditions of the Deed of Gift, provided that said foreign yacht club shall, by instrument in writing lawfully executed, enter with the SDYC into the like covenants as are herein entered into by it, such instrument to contain a like provision for the successive assignees to enter into the same covenants with their respective assignors, and such instrument to be executed in duplicate, with one counterpart to be retained by each club and a copy thereof to be forwarded to the NYYC. 3.

Applicable Law. The parties hereto further agree that, the trust under which the Cup is held having been created under the laws of the State of New York, and having been amended as aforesaid by order of the Supreme court of the State of New York, the terms and conditions of the Deed of Gift shall be governed by, and construed in accordance with, such laws, and any proceeding for the amendment or interpretation of such terms and conditions shall be brought before the courts of the State of New York.

IN WITNESS WHEREOF, the parties have caused this instrument to be executed by their duly authorized officers as of the date first above written.

ROYAL NEW ZEALAND YACHT SQUADRON Commodore Peter B. Hay SAN DIEGO YACHT CLUB Commodore Michael A. Morton

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ROYAL NEW ZEALAND YACHT SQUADRON to SOCIETE NAUTIQUE DE GENEVE (March 9, 2003) [Issued for the fourth legal transfer of the Cup from RNZYS to SNG following the loss of the America’s Cup to United States in March 2003. Document provides for continuation of the provisions of the Deed of Gift.]

ASSIGNMENT AND ACCEPTANCE ROYAL NEW ZEALAND YACHT SQUADRON – SOCIETE NAUTIQUE DE GENEVE THE ASSIGNMENT BY THE ROYAL NEW ZEALAND YACHT SQUADRON OF THE AMERICA’S CUP AND ITS ACCEPTANCE

BY THE SOCIETE NAUTIQUE DE GENEVE, DATED 9 MARCH 2003.

LOOKING FOR THIS DOCUMENT?? SO ARE WE! DOCUMENT WILL BE ADDED AS SOON AS WE OBTAIN A COPY. INFORMATION IS THAT THE TEXT IS ALWAYS IDENTICAL TO THE PRECEEDING, WITH THE EXCEPTION OF THE NAMES AND DATES.

SOCIETE NAUTIQUE DE GENEVE to GOLDEN GATE YACHT CLUB (February 14, 2010)20 April 2010 [Issued for the fifth legal transfer of the Cup from SNG to GGYC following the loss of the America’s Cup to United States in February 2010. Document provides for continuation of the provisions of the Deed of Gift.]

ASSIGNMENT AND ACCEPTANCE SOCIETE NAUTIQUE DE GENEVE – GOLDEN GATE YACHT CLUB THE ASSIGNMENT BY THE SOCIETE NAUTIQUE DE GENEVE OF THE AMERICA’S CUP AND ITS ACCEPTANCE

BY THE GOLDEN GATE YACHT CLUB, DATED 14 FEBRUARY 2010 (20 APRIL 2010).

LOOKING FOR THIS DOCUMENT?? SO ARE WE! DOCUMENT WILL BE ADDED AS SOON AS WE OBTAIN A COPY. INFORMATION IS THAT THE TEXT IS ALWAYS IDENTICAL TO THE PRECEEDING, WITH THE EXCEPTION OF THE NAMES AND DATES.

GOLDEN GATE YACHT CLUB to ROYAL NEW ZEALAND YACHT SQUADRON (June 26, 2017) [Issued for the sixth legal transfer of the Cup from GGYC to RNZYS following the loss of the America’s Cup to United States in June 2017. Document provides for continuation of the provisions of the Deed of Gift.]

ASSIGNMENT AND ACCEPTANCE GOLDEN GATE YACHT CLUB – ROYAL NEW ZEALAND YACHT SQUADRON THE ASSIGNMENT BY THE GOLDEN GATE YACHT CLUB OF THE AMERICA’S CUP AND ITS ACCEPTANCE

BY THE ROYAL NEW ZEALAND YACHT SQUADRON, DATED 26 JUNE 2019.

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OTHER DEEDS OF GIFT Deed of Trust – Knickerbocker Yacht Club Centennial Trophy (1973) Knickerbocker Yacht Club – CENTENNIAL TROPHY (1973) DEED OF TRUST To commemorate the 100th Anniversary of its founding in 1874, the 1973 Officers and Governors of the Knickerbocker Yacht Club hereby establish the CENTENNIAL TROPHY as a permanent trophy to be awarded to the yacht which in the judgement of the Race Committee of the New York Yacht Club is the runner up in the trials to select the United States representative in the competition for the America’s Cup. The CENTENNIAL TROPHY shall remain in the custody of the New York Yacht Club. An appropriate prize donated by the Knickerbocker Yacht Club shall be awarded to the skipper of the yacht so selected and suitable notations of the award shall be made on such CENTENNIAL TROPHY. In the event the America’s Cup is retired, this Deed of Trust may be modified by mutual agreement of the New York Yacht Club and The Knickerbocker Yacht Club.

On behalf of its Officers and Governors.

The following represents the Memorandum executed by the Ida Lewis Yacht Club for the loan of the PELL CUP

Memorandum – Loan Receipt – Herbert C. Pell Cup

IDA LEWIS YACHT CLUB 170 Wellington Avenue Newport, Rhode Island. 02840 USA MEMORANDUM – LOAN RECIEPT

Date: Received from Ida Lewis Yacht Club (“ILYC”), the sterling silver Revere Bowl and walnut base, called the Herbert C. Pell Cup and awarded to the Challenger for the Americas Cup. The Trophy to be held on loan by ILYC to the yacht club represented by the challenging yacht and may be displayed in the clubhouse of that yacht club. It shall be returned to ILYC upon request of ILYC, and in a timely fashion for awarding to the next Challenger.

The Ida Lewis Yacht Club will be responsible for having the trophy engraved.

Received on behalf of: By:

Circolo Della Vela Sicilia Yacht Club, Team Luna Rossa Prada Pirelli

___________________________________ ___________________________________ Please Print Name

Date:

____________________ 2021 at Auckland New Zealand

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From:

___________________________________ Representing Ida Lewis Yacht Club

Deed Conditions - BRENTON REEF, CAPE MAY, GOELET AND ASTOR CUPS Deed Conditions - Brenton Reef Cup DEED CONDITIONS “This cup will be offered to the yachts of all nations, to be sailed for in an ocean race, on a course from the Lightship off Newport to and around the Lightship off Sandy Hook and outside of Long Island, and return. Said cup to be held by the winner for the term of thirty days after the race, without liability to challenge. Upon the expiration of said period, the winner of the cup must accept any challenge, and be prepared to sail a race over the same course within the space of fifteen days next ensuing the receipt of such challenge, or forfeit the Cup to the challenger. Should any yacht succeed in holding the cup in two consecutive races in one season, the owner thereof will not again be liable to challenge until the commencement of the yachting season of the year next ensuing.

In the event of the Cup being held at the close of a season by a foreign yacht, the owner thereof will be liable to challenge during the season of the year ensuing for an ocean race over a course from the Needles, Isle of Wight to and around a stakeboat off the harbor of Cherbourg, and return.

The ocean races for the Brenton Cup will be sailed according to the rules of the New York Yacht Club, but without allowance for time.

It is understood that in case any yacht holding the before-mentioned challenge shall be sold out of the New York Yacht Squadron, the Cup is not disposed of with her, but must be returned to New York Yacht Club to be sailed for again in the manner and form before provided for the schooners and sloops and for the ocean races.

It is also understood that in case a foreign yacht should hold the challenge Cup, and should be sold out of a Royal Yacht Club, the Cup is not sold with her, but must be returned to the New York Yacht Club, to be sailed for again in an ocean race, as above provided.

The yachting season in American waters for the before-named challenge Cup will be from the third Thursday in June until the third Thursday in October.

Upon this challenge Cup, there shall be engraved the names of those yachts, and the owners thereof, that have held the same, and a die, with appropriate devices thereon from which a medal can be struck, to be held by the owners of said yachts.

Any yacht challenging the holder must deposit five hundred ($500) dollars with the regatta Committee, to be forfeited in case the challenging party is not successful in winning, otherwise to be returned to him. If forfeited, to be invested in a Cup to become the property of the challenged party.”

Deed Conditions - Cape May Cup DEED CONDITION “1st.

It is to be held by the winner for thirty days after the race, without liability to challenge.

Upon the expiration of that period, the winner must accept any challenge, and be prepared to sail a race over the same 2nd. course within fifteen days from the receipt of such challenge, or forfeit the Cup to the challenger; but should any yacht succeed in holding the Cup in two consecutive races in one season, it will not again be liable to challenge until the commencement of the yachting season of the following year. The Cup will become the bona fide of any yacht holding it successfully thorough three consecutive contests.

3rd.

The yachting season in American waters, in reference to this Cup, is understood to be from the third Thursday in June until the third Thursday in October in each year.

Should a yacht holding the Cup be sold out of the New York Yacht Club, the Cup shall not go with her, but shall be returned 4th. to the Club, to be again sailed for; and if he Cup should be held by a foreign yacht, and she should be sold out of the Club to which

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she belongs, the Cup shall not be sold with her, but shall be returned to the New York Yacht Club to be sailed for again as above provided.

5th.

In the event of the Cup being held at the close of the season by a foreign yacht, the owner thereof will be liable to challenge during the season of the next year for an ocean race over a course from the Needles, Isle of Wight, to and around a stakeboat off the harbor of Cherbourg, and return.

Any yacht challenging the holder must deposit five hundred ($500) dollars with the Regatta Committee, to be forfeited in case the challenge party is not successful in winning, otherwise to be returned to him. If forfeited, to be invested in a Cup to become the property of the challenged party.

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Including Herbert C. Pell, Citizen’s, Louis Vuitton and Prada Cups

End Notes “On motion of Mr. Grinnell, it was Resolved, That the New York Yacht Club accept the Cup won by the “America” and presented to them by the proprietors, upon the terms and conditions appointed by them.

Resolved, That the letter of Mr. Schuyler, with the inclosure (sic), to be entered on the minutes, and the Secretary be requested to furnish to all foreign yacht clubs a copy of the conditions upon which this Club holds the Cup and which permanently attach to it. N. Bloodgood, Secretary.” i

ii

Royal Thames Yacht Club, UK Royal Harwich Yacht Club, UK v Royal Canadian Yacht Club, Canada vi Bay of Quinte Yacht Club, Canada vii Winfield M. Thompson and Thomas W. Lawson, The Lawson History of the America's Cup: A Record of Fifty Years, at 78 (Ashford Press Publishing, Southampton 1986) (internal quotation marks omitted). iii iv

viii

Id. at 88.

Source: NYYC 1857 Minutes.

NOTE: In the Minutes, Tralee is listed as the city for the Royal Yorkshire YC. As in Tralee, Ireland.

Because the RYYC is located in England (and never in Tralee, let alone Ireland), I listed the city of Hull where the RYYC was located in the 1850s.

Of course, if Tralee is not a typo, then RYYC is the typo. So maybe the invitation was supposed to be sent to an Irish yacht club based in Tralee? ...and not the RYYC....hmmm...

ix x

xi

Royal Yacht Squadron, UK Royal Northern Yacht Club, UK

https://timesmachine.nytimes.com/timesmachine/1890/08/01/103255420.html?pageNumber=1 Royal Clyde Yacht Club, UK xiv Royal Ulster Yacht Club, Ireland xv Royal Sydney Yacht Squadron, Australia xvi Royal Thames Yacht Club, UK xvii Royal Perth Yacht Club, Australia xviii Compagnia Della Vela de Venzia, Italy xii

xiii

Royal New Zealand Yacht Squadron, New Zealand Yacht Club Punta Ala, Italy xxi Societe Nautique de Geneve, Switzerland xxii Golden Gate Yacht Club, San Francisco, CA, USA xix xx

‘Golden Gate argued at the hearing on July 21st that the mutual consent language should also be read to control the clause requiring that the default races be sailed subject to the defender’s rules. The court finds that the clauses are separate and that a consent requirement would be entirely inconsistent with the default provision’s intent to create a situation where the race can still be held regardless that the parties have failed to agree.

xxiiixxiiixxiii

Version 1.0

Page 139 of 140

The Deed

America’s Cup Compendium

Including Herbert C. Pell, Citizen’s, Louis Vuitton and Prada Cups

The Deeds

Page 140 of 140

Version 1.0

Now Available on ISSUU and elsewhere.

Mark Robinson Holland

An Exci�ng Documentary by Author Mark Robinson Holland

Attack On the

Cup

Attack on the Cup: The Story of the Conspiracy to Destroy the world’s Oldest International Sporting Prize – America’s Cup – and the efforts to save it.

In March 1997, a New Zealand Tribesman who was frustrated with perceived aspects of the upcoming 2001 America’s Cup competition viciously attacked the priceless 150-year-old trophy with a sledgehammer.

Attack on the Cup is the most comprehensive look at the attack, the arrest and trial, the sentencing and the reaction to the assault.

Includes never-before published police photos and trial testimony. The book also covers the restoration of the Cup in London by Garrard and the aftermath. A must-read for all America’s Cup fans.

Mark Robinson Holland is an America’s Cup historian and researcher. A�er re�ring as a successful Architect Emeritus, he began the mul�-year research project that culminated in the publica�on of America’s Cup Compendium: a record of every yacht, yachtsman, owner, designer, builder and yacht club, in addi�on to logs of every America’s Cup final race regata and each observa�on, qualifying, trial and elimina�on race that led up to the finals during each “Cup” year. Research for Compendium has taken Mark thousands of research hours since beginning in March 2020, and visits to countless Marine Libraries in the United States, Australia, New Zealand and Europe. Mark is married and lives in Methuen, Massachusets USA. AMERICASCUPCOMPENDIUM.COM

Available in hardcover in Mid-2024 at booksellers everywhere.

THE SILVER that launched a Thousand ships. The history of the America’s Cup Trophy Companion Book by Contributing Authors Jack Griffin and Karolina Stefanski, PH.D. Jack Griffin is an America's Cup historian and modern chronicler. He serves on the Selection Committee of the America's Cup Hall of Fame and is the International Liaison for the Herreshoff Marine Museum, home of the America's Cup Hall of Fame. Griffin's book Turning the Tide - How Oracle Team USA Defended the America's Cup tells the definitive story of the 2013 America's Cup competition in San Francisco. He writes a monthly column on the America's Cup for Seahorse Magazine and is the editor of a well-respected website CupExperience.com. Based in Switzerland, Griffin holds a degree in electrical engineering from Princeton University and is fluent in English, French and German.

Karolina Stefanski, Ph.D. Dr. Stefanski is a leading art historian. Dr. Stefanski is the Yachting and Silver Ambassador for Robbe & Berking, one of the world’s leading silversmiths. She holds a master’s from the Institut national d’histoire de l’art (INHA, Paris-Sorbonne) and a Ph.D. from the Technical University of Berlin. She is fluent in German, English, French and Polish.

AMERICA’S CUP COMPENDIUM Including Herbert C. Pell, Citizen’s, Louis Vuitton and Prada Cups

The Historical Record of the Races to America’s Cup, contained in 15 Books: Book 1 – The Guide Includes Introductions, a Master Table of Contents for the entire Compendium series, Acknowledgements, Bibliography, Credits, information and suggestions regarding best interactive use of New York Times Machine, YouTube and WWW links, and Appendices.

Book 2 - The Cups In-depth details and history of the well-known America’s Cup and trophies including the Louis Vuitton and the Prada Cups, plus full information on the Herbert C. Pell Cup, the Sir Thomas Lipton Memorial Trophies, the America’s Cup Match Trophy, the President’s Award, the Knickerbocker Yacht Club Centennial Trophy, the NYYC Club Cup and many others. This section also includes detailed history of the cups, their travels, their bespoke designer luggage, and of the attack and restoration of the Cup in 1997.

Book 3 - The Deeds

This section covers the Original Deed of Gift, the 2nd and 3rd Amended Deeds, and the current version. Included are the NY State Supreme Court -approved amendments and official documents for 14 court cases, all of the interpretive Resolutions, Protocol Decisions, and the Assignment and Acceptance documents for the Cup.

Book 4 - The Rules - Volume 1 This section covers the Racing Conditions, Sailing Instructions and Protocols for Preliminary, Trial, Qualifying, Elimination Races and for each America’s Cup Final Match Races from the Royal Yacht Squadron race around the Isle of Wight at Cowes to the 2013 34th Defense at San Francisco.

Book 5 - The Rules - Volume 2 Part 2 continues with the Rules 2017 to present. Additionally, the yacht “rating rules,” Class rules and technical regulations and various governmental America’s Cup Acts.

Book 6 - The Yachts Detailed side-by-side tables of competing yachts, by Race Series, showing final yacht matchups in the Races for America’s Cup and all other contending yachts that year, providing the dimensions, crews, ownership, and other relevant data on each boat – whether they won, lost or never reached the start line.

Book 7 - The Races All of The Races from the initial 1851 RYS race around the Isle of Wight, each preliminary, trial, elimination and final races for America’s Cup are presented in detailed tables. Where there was a news article from the New York Times, an internet article or a YouTube video of the race, they are presented with a hyperlink.

Book 8 - The Venues Includes the Course Layouts for the races.

Book 9 - The Costs Analysis of the growing costs of competing for the Cup [Coming mid-2024]

Book 10 - The Yacht Clubs Presents a directory for each Yacht Club that sponsored a competitor for the Cup since 1851.

Book 11 - The Crews Includes an alphabetical, comprehensive list of sailors, shore crews, sailmakers and boatsmen since 1851.

Book 12 - The Owners Includes a tabulation of Yacht Owners and their financial syndicate members, and (in later years) Sponsors

Book 13 - The Officials Directory of Race Committee Members, International Jurors, and Official Measurers

Book 14 - The Designers A listing of the principal yacht, rigging and sail designers of each America’s Cup yacht from 1851-2024.

Book 15 - The Builders Identifies and historically-backgrounds the shipwrights of the America’s Cup.

MARK ROBINSON HOLLAND with Jack Griffin