Keeler v. Schulte

259 P.2d 37, 119 Cal. App. 2d 132, 1953 Cal. App. LEXIS 1192
CourtCalifornia Court of Appeal
DecidedJuly 9, 1953
DocketCiv. No. 4505
StatusPublished
Cited by2 cases

This text of 259 P.2d 37 (Keeler v. Schulte) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Keeler v. Schulte, 259 P.2d 37, 119 Cal. App. 2d 132, 1953 Cal. App. LEXIS 1192 (Cal. Ct. App. 1953).

Opinion

GRIFFIN, J.

Defendants prosecuting this appeal are (1) James A. Long, the present leader of The Theosophical Society, an unincorporated organization; (2) Ruth Schulte, Constance Hostler, Earl Hostler and Ross Simpson, who were and are four of seven members of the board of trustees of San Diego Lodge No. 1, American Section of The Theosophical Society, at Covina, California; (3) The Theosophical Endowment Corporation, a nonprofit California corporation; and (4) Kirby Van Mater. The nonappealing defendant is the Hebrew Home For the Aged Association, a corporation, alleged purchaser of the real property here involved.

Plaintiff, treasurer of and in a claimed representative capacity for the members of San Diego Lodge No. 1, American Section of The Theosophical Society, a California corporation, brought this action to set aside a deed of the lodge property and to restrain the attempted dissolution of the lodge. The lodge was originally incorporated about 1932, in the name of Katherine Tingley Lodge No. 1, and about 1945, it changed its name to the name indicated. At the time of the grievances here complained of it had 88 active members. It owned real and personal property valued at approximately $30,000. It adopted its own by-laws which provided generally that the lodge “recognizes the authority of the Constitution of the Theosophical Society (Covina),’’ “and shall conform with the By Laws of the American Section.’’ They also provided for a board of directors consisting of seven members; that a [134]*134quorum shall be composed of 20 members of the lodge and that “A special meeting of members may be called at any time by request of President, by a majority of members of Board of Trustees, or by 10 per cent of members collectively, upon three days’ written notice, and such notice specifying the proposed purpose of the meeting.” Article IV, section 2 thereof, provides that “The Board of Trustees shall be the legislative body of the Lodge and shall execute all corporate powers and the business affairs of the organization, ’ ’ and that “A majority vote shall be necessary for decision at such meetings.” Article X, section 1, provides that “The property of San Diego Lodge No. 1 shall be in the hands of the Board of Trustees, who shall have supreme power in this respect and in all legal matters pertaining to the welfare of the lodge”; that the property “now in its possession, of any kind whatsoever, whether real or otherwise, shall remain as such while working under the present Charter,” and that “No member of this Lodge shall have any individual right or title to such property.” Section 3 then provides that “Should this Lodge at any time be disbanded, or should its Charter be revoked, or should it by any other means go out of existence, its entire property, real, personal and mixed, shall become the property of Theosophical Endowment Corporation.” The constitution of The Theosophical Society, adopted in 1929, provides generally that applications for lodge charters shall be made to it and such lodge charters shall not be effective until signed by the leader; that when such an organization adopts “this constitution” it shall become an integral part of “The Theosophical Society.” By it, the leader is given the power to declare the policy and in general to direct the affairs of the society.

It appears from the evidence that one Colonel Conger was, on February 6, 1951, leader of The Theosophical Society. He reputedly died about February 20, 1951. He had been physically handicapped and had been suffering for some time from such condition. About February 6, 1951, two claimed emissaries of his arrived in San Diego about 2 o’clock in the afternoon, called the president and secretary of the lodge on the phone, and informed them that a meeting of the lodge must be held that night at 8 o ’clock. About 19 members were thereafter called on the phone about the special meeting. Shortly before 8 o’clock the two emissaries met with the trustees present and delivered a purported oral message from the leader and informed those present that two forces had [135]*135been causing trouble in the church and that the leader wanted the lodge dissolved; that the idea was to sell their present building, “get rid of everything . . . and the old scandals,” and that this “came as a specific, urgent inquiry of the soul.”

Thereafter, at 8 p.m., another meeting, denominated in the minutes a “Special Meeting,” was called before the members present. Others attended this meeting who were not members. They were told this same purported message by the emissaries, and that they wanted the business completed that night. It was then moved that the leader’s order be carried out and that a vote of confidence follow. It carried by a rising vote and the meeting adjourned. The charter, minutes, etc., were delivered over to the emissaries. The business books and accounts were retained by plaintiff. Thereafter, the trustees authorized the sale of the real property, furniture, etc. A grant deed of the real property to the defendant Hebrew Home For the Aged Association was executed by the “Theosophical Endowment Corporation,” which is a subordinate organization of The Theosophical Society, and the one named in the by-laws as the one entitled to all the lodge’s property in the event of surrender of the charter. The consideration was $17,000. An escrow was opened but there was no deed executed by the lodge to the Theosophical Endowment Corporation. The escrow has not been closed.

It is appellants’ contention that title thereto passed, ipso facto, under the provisions of the by-laws on the surrender of the charter. Plaintiff’s contention is that only 19 members were present and the remainder of the members apparently had no knowledge of the meeting or the purpose for which it was held, and had no opportunity to defend against the accusations of slander and gossip or to participate in the vote; that no notice of a special meeting was given, as required by the corporation’s by-laws; that no delegation of power to dissolve the lodge or surrender its charter and dispose of practically all of its assets is contained in the by-laws without proper notice, and that if such by-laws gave such power it was unreasonable, contrary to public policy, not in harmony with the objects of society, and in violation of sections 9800 and 3901 of the Corporations Code, which provide that a corporation may not sell all or substantially all of its assets except under authority of its board of trustees and with the vote or written consent of shareholders. In support of these propositions they cite such cases as Knights of Ku Klux Klan, Inc. v. Francis, 79 Cal.App. 383, 385 [249 P. 539]; [136]*136Grand Grove, etc., Druids v. Garibaldi Grove, etc., Druids, 130 Cal. 116, 120 [62 P. 486, 80 Am.St.Rep. 80]; and Supreme Lodge of the World v. Los Angeles Lodge No. 386, 177 Cal. 132, 136 [169 P. 1040].

The trial court, in the first instance, signed detailed findings to the effect that although the members of the lodge took no formal action in reference to the sale of the property, under the by-laws the trustees alone had such power, and that its charter had been revoked and surrendered, and concluded that plaintiff, in a representative capacity for such members, was not entitled to any relief. It ordered plaintiff, as treasurer, to pay over to the Theosophieal Endowment Corporation $2,377.90 cash remaining in the treasurer’s hands. Judgment was entered accordingly.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Thatcher v. City Terrace Cultural Center
181 Cal. App. 2d 433 (California Court of Appeal, 1960)
Keeler v. Schulte
306 P.2d 430 (California Supreme Court, 1957)

Cite This Page — Counsel Stack

Bluebook (online)
259 P.2d 37, 119 Cal. App. 2d 132, 1953 Cal. App. LEXIS 1192, Counsel Stack Legal Research, https://law.counselstack.com/opinion/keeler-v-schulte-calctapp-1953.