Kennedy v. Roberts

140 A. 656, 15 Del. Ch. 401, 1926 Del. Ch. LEXIS 39
Supreme Court of Delaware·Decided October 29, 1926·Published·Cited by 1 cases

Opinion

Pennewill, C. J.

delivering the opinion of the Court.

The fourteen assignments of error filed in this case will be considered by the court, as they were in the argument, and as covered by the following propositions, viz.:

1. That the United Brotherhood of Maintenance of Way Employees and Railway Shop Laborers had no legal right to institute or maintain the suit in question in the form of a class-bill or otherwise. ;The only parties who could have brought said suit was the Pennsylvania System Division by its Trustees or other qualified persons, on a class-bill by one or more persons brought on behalf of the said Pennsylvania System Division and those connected therewith, and for its sole and exclusive benefit.

2. Assuming that said suit was properly brought, it should have been dismissed because the same abated long before the termination of said suit.

The following allegations of the bill of complaint are not denied by the appellants, defendants below, viz.: That the United Brotherhood of Maintenance of Way Employees and Railway Shop Laborers is a voluntary unincorporated association of railway employees having a very large membership of persons residing in many different parts of this country and Canada; that it is an organization composed of a Grand Lodge and numerous subordinate lodges; that some of the subordinate lodges are grouped together for certain purposes, one such group being the Pennsylvania System Division of United Brotherhood of Maintenance of Way Employees and Railway Shop Laborers; that said Grand Lodge and subordinate lodges are members of said Brotherhood; that the members of the subordinate lodges are also members of the Brotherhood, and that said Pennsylvania System Division is also a part of said Brotherhood.

The following allegations of the bill were fully supported by the evidence, and for the most part not denied by the answer, viz.:

That on November 7-and 8, 1921, the defendant, Kennedy, was the Chairman, and the defendant, Haines, the Secretary-Treasurer of a protective department of the Pennsylvania System [404] Division, and that they, as well as other defendants, w^ere agents and servants of said protective department and Brotherhood, and were then acting under such employment or agency; that a considerable amount of money belonging to said Pennsylvania System Division was, at the time of filing the bill of complainant, in the possession of said defendants, or some of them, whose duty it was to use said funds in accordance with the constitution of the Brotherhood, and for promoting its interests and not otherwise; that said defendants on or before November 7, 1921, attempted to take' from the said Pennsylvania System Division and said Brotherhood a large number of members and form a new organization in place of said Pennsylvania System Division organization, and take from it its property, and moneys; that said defendants, particularly Kennedy and Haines, were using said moneys and property for purposes other than to promote the interests of said Pennsylvania System Division and Brotherhood.

Only two of the defendants, Kennedy and Haines, filed an answer in the cause, and in the argument before this court, as in the argument before the Chancellor, all claims of the defendants to moneys and property in their possession were abandoned, it being admitted that said property and moneys belong to the Pennsylvania System Division of the Brotherhood, and that the defendants have no right to them.

It also appears that the defendants held a meeting on November 7 and 8, 1921, at which they organized a new association called the Pennsylvania System Fraternity, and that thereafter they ceased to be members of the Brotherhood and of the Pennsylvania •System Division, but retained the funds and property belonging to the said Division.

It was shown by the evidence, and not denied, that the Brotherhood and the Pennsylvania System Division, after November 7 and 8, 1921, continued to function and carry on the business in accordance with the constitution and by-laws of said Brotherhood.

In thé argument in this court the only reason urged by the defendants for retaining possession of the moneys and property which admittedly belonged to the Pennsylvania System Division, was, first, that the suit was not properly brought; and, second, that the suit, if properly brought, had thereafter abated because of alleged disqualifications of the two complainants, Roberts and Armour.

[405] The court below held that the moneys and property in possession of the defendants were held by them for the benefit of that branch of the Brotherhood known as the Pennsylvania System Division, and that Armour, one of the complainants, was, at the time suit was brought and thereafter, a member in good standing of the Brotherhood, and, therefore, fully qualified to be a complainant in the cause.

The decree of the lower corut ordered the defendants to deliver to the Pennsylvania System Division, a branch of the Brotherhood, all books and records relating to the business and affairs of said Pennsylvania System Division, and further ordered that the moneys and property in dispute be paid or delivered to the Pennsylvania System Division.

It will be observed that none of the assignments of error relied on by the appellants go to the merits of the case, that is, to the right to the possession of the moneys and property obtained and held by the defendants.

The defense made to the bill of complaint is, that the suit was improperly brought, and particularly, the incapacity of the complainants to enter the suit, or to maintain the suit after it was entered.

There were two complainants — William D. Roberts and David M. Armour — who filed in the court below what is known in the law as a class-bill, for the benefit of themselves and others.

It is not denied that, in an unincorporated association of the character of the one here involved, even one member may file a bill for the protection of the interests, and the redress of the grievances, of his brother members if he is in good standing at the time.

But the appellants contend, first, that such a suit could not be brought before a request was made to the Board of Directors or managing body of said association setting forth the alleged wrongs or injuries and requesting and demanding that a suit be brought by them against the wrongdoer.

No authority has been cited, and we think none can be found that supports such proposition, although any number can be found that would be applicable if the association was incorporated. Such were the cases cited by the appellees. The Chancellor’s opinion on [406] this point is so clear and convincing that no attempt will be made to supplement it.

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Kennedy v. Roberts, 140 A. 656, 15 Del. Ch. 401, 1926 Del. Ch. LEXIS 39 (Del. 1926).

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