Nonprofit Law YOU Want to Know
We regularly feature answers to questions from readers in our “Your Legal Questions Answered” column. The full list can be viewed on the site.
May we pay to cut dangerous trees at member’s house?
Lead Stories
Court Disqualifies Former Attorney From Representing Employee Against Agency
Knowledge gained in decade as general counsel creates substantial risk that confidential information could be used
A federal District Court in Tennessee has disqualified the former general counsel of a nonprofit professional organization from representing a former employee suing the organization for wrongful termination. It said the attorney’s service as general counsel for more than a decade creates “a substantial risk that confidential factual information that would normally have been obtained in the prior representation would materially advance the client’s position in the subsequent matter.”
Bylaw Provision on Directors’ Removal Does Not Prevent Judicial Removal
Court says bylaw and statutory removal provisions are not exclusive and supplement each other without contradiction
In the “latest installment of long-running serial litigation” involving control over an Oregon homeowners’ association, the Oregon Court of Appeals has reversed a trial court and held that a court has jurisdiction to consider judicial removal of members of the board of directors, even where the association’s bylaws provide a means of removal by the members. The Court has reversed a trial court decision dismissing an action seeking judicial removal of the board.
Unsigned Gift Pledge Enforceable Against Donor’s Estate
Temple’s detrimental reliance in capital campaign converts commitment to level of enforceable pledge
A decedent’s estate properly paid a $246,000 claim to a Jewish synagogue when the Temple relied on the unsigned pledge to encourage others to participate in its campaign for a new building and endowment, the Supreme Court of Alabama has ruled. The fact that one of the co-executors was a member of the Temple and on one of its committees did not invalidate the payment. (Ruttenberg v. Friedman, No. 1090600, 5/11/12.)
Boy Scouts Lose Efforts To Protect Abuse Files
Oregon court permits release of “ineligible volunteer” files, Idaho court orders production of “perversion” records for discovery
The Boy Scouts of America has recently lost two efforts to keep confidential its internal records of volunteers accused of sexual abuse. Several decades of records were, or could be, used to support damage claims by men seeking to impose liability on the Scouts for abuse.
The Oregon Supreme Court has affirmed a trial court decision to open redacted files to the media upon the conclusion of a case in which a jury returned a verdict against the Scouts for $1.4 million in compensatory damages and $18 million in punitives.
Bankruptcy Court Dismisses Case When Issue Is Control of Nonprofit
May “members” of corporation approve acquisition when board of directors rejects transaction?
A bankruptcy court in western Pennsylvania has dismissed a bankruptcy proceeding it found was not filed in good faith by directors of a nonprofit corporation when the corporation was not insolvent and the board was fighting for control of the organization in a pending state court proceeding. (In Re: Laurel Highlands Foundation, Inc., Debtor, Bkrptcy Ct. W.D. PA, No. 12-22558, 6/12/12.)