Lead Stories

Finding Substantial Burden Under RLUIPA Is Task For Court

Ninth Circuit joins other circuits in holding that the question is not one for a jury

Whether a local land use regulation imposes a substantial burden on the free exercise of religion is a question of law for the court and not a question of fact for a jury, the Ninth Circuit Court of Appeals has held.  It has joined the reasoning of the First and Sixth Circuits in determining that the decision-maker under the Religious Land Use and Institutionalized Persons Act (“RLUIPA”) is the court and not the jury.

Insurance Doesn’t Protect Entity From Claims Against Merger Partner

Courts agree that policies do not cover claims of wrongdoing by the merged organization occurring before effective date of merger

A claims-made insurance policy normally protects the insured organization against claims brought during the term of the policy against the insured company for “wrongful acts” by the insured company and its subsidiaries.

Unrelated Third Party Unable to Revive Lapsed Corporation

Court voids revival by person with no prior connection who wanted to control real estate through merger

When William N. Ford, Sr., the president of the Sterling Foundation, sought to purchase real estate in New Mexico on which to run an addiction and treatment center, he was rebuffed by Susan Lynn Lavendar Baran, the president of the Ann Wigmore Foundation that owned the land.  As an alternative after several further attempts to buy the property failed, on November 12, 2018, Ford suggested that the two nonprofits merge.  Lavandar (as she was called throughout the ultimate Court opinion) declined that offer as well.

Directors of Nonprofit Corporation Have No Fiduciary Duty to Members

Court dismisses case claiming that director breached fiduciary duty to member

A director of a nonprofit corporation has a fiduciary duty to the corporation but only to the corporation and not to the individual members of the corporation, a federal District Court in New Jersey has ruled.  It has dismissed, without leave to amend, a second amended complaint by a member of the National Association of minor league baseball teams against a member of the board.

Animals Lose Again, Denied Standing to Sue for Rights

Court says habeas corpus law applies only to humans, not elephants

In the latest battle in the continuing fight to obtain legal rights for sentient animals, the Colorado Supreme Court has ruled that a nonprofit organization seeking to protect the rights of elephants has no standing to sue because the elephants are not “persons” entitled to the habeas corpus protection sought on their behalf.  The Court has unanimously ruled that the state habeas corpus law applies only to human beings.

Nonprofit HOA May Use Subchapter V To File Small Business Bankruptcy Plan

Court says HOA is “engaged in commercial or business activities” and may use simplified process for reorganization plan

The 11th Circuit Court of Appeals has held that subchapter V of the Bankruptcy Code, as adopted by the Small Business Reorganization Act of 2019, may be utilized by a nonprofit homeowners’ association to provide a reorganization plan even though the debtor is not organized or operated for profit.