Lead Stories

Members of a nonprofit corporation may call a special meeting to oust directors without asking the secretary of the corporation to send the notice, an appellate court in Washington state has held, when the action is specifically authorized by the organization’s bylaws that permit direct action. (Island Landmarks v. Matthews, Ct. of App., WA, Div. 1, No. 69619-o-I, 12/23/13.)

A nonprofit health insurance benefit administrator has been enjoined from spending police union funds to support or oppose candidates in a union election even though authorized by its own board and the union officials overseeing the administrator. A divided Pennsylvania Commonwealth Court has reversed a trial court and ruled that such action is not authorized by the vendor’s articles of incorporation, bylaws or law. (Zampogna v. Law Enforcement Health Benefits, Commonwealth Ct., PA, No 1322 C.D. 2012, 11/27/13.)

The Tenth Circuit Court of Appeals has reversed a District Court and has held that the Bankruptcy Code permits a bankruptcy trustee to void the entire amount of a donor’s charitable contribution if it exceeds 15% of the donor’s gross annual income. It has reversed a District Court decision holding that the trustee could recover only the amount of the gift that exceeds 15%. (In re: McGough, Wadsworth v. The Word of Life Christian Center, 10th Cir., No. 12-1142,12/16/13.)

A federal District Court in Utah has permitted an association of professional fundraising counsel and an individual fundraising counsel firm to proceed with a constitutional challenge to the Utah charitable solicitation registration statute. The law requires fundraising counsel to register in the state even when they have no contact with the state other than a client that solicits there.  The Court has denied the state’s motion to dismiss for failure to state a claim upon which relief could be granted.

We regularly feature answers to questions from readers in our “To the Point” column. The full list can be viewed here. Here are a few questions recently received from readers.

Can inactive members sue to recoup funds?

A trial court in Connecticut has refused to grant summary judgment to the volunteer president of a Jewish synagogue who was sued by an employee for allegedly failing to adequately supervise the executive director who fired her improperly.  The Court has ruled that the federal Volunteer Protection Act protects a volunteer from suit for mere negligence, but not a flagrant indifference to the rights of the injured, and that the president failed to eliminate a question of fact on the issue.  (Maisano v. Congregation Or Shalom, Superior Ct., CT, New Haven, No. CV074027175S, 11/19/09.)