Shipyard Workers Educational Ass'n v. Lynch

250 Cal. App. 2d 238, 58 Cal. Rptr. 283, 1967 Cal. App. LEXIS 2099
CourtCalifornia Court of Appeal
DecidedApril 20, 1967
DocketCiv. No. 30056
StatusPublished

This text of 250 Cal. App. 2d 238 (Shipyard Workers Educational Ass'n v. Lynch) 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
Shipyard Workers Educational Ass'n v. Lynch, 250 Cal. App. 2d 238, 58 Cal. Rptr. 283, 1967 Cal. App. LEXIS 2099 (Cal. Ct. App. 1967).

Opinion

HERNDON, J.

This action for declaratory relief was brought by Shipyard Workers Educational Association, Inc., hereinafter referred to as the “Association,” and by four individual plaintiffs who are alleged to be “the elected or de facto board of directors and officers” of plaintiff Association.

The Attorney General of the State of California was named as the sole defendant. As a more or less incidental item of relief, the complaint sought a determination of the question whether or not the Association was a charitable corporation subject to the Uniform Supervision of Trustees for Charitable Purposes Act. (Gov. Code, §§ 12580-12585.)

The two adversary parties who entered the litigation by way of intervention are Local Union No. 9 of the Industrial Union of Marine and Shipbuilding Workers of America and the Industrial Union of Marine and Shipbuilding Workers of America, APL-CIO. These intervenors, who are the appellants herein, will be referred to hereinafter as the “National Union” and the “Local” or “Local 9.”

The Nature of the Controversy

As the allegations of the pleadings clearly indicate, and as all parties apparently agree, the major and essential reason for the bringing of this action was to secure an adjudication of an existing controversy between the Association and the intervenors.

The Association sought, inter alia, a declaration to the effect that it was vested with all right, title and interest in and to certain described real property to which it held legal title and that it was “empowered to sell, encumber, and otherwise deal with the real property and other assets of said corporation pursuant to the Articles and By-Laws and the laws of the State of California. ’ ’

The essence of the opposing position taken by the National Union and Local 9 as stated in their pleading, and as indicated throughout the trial, was that respondent Association was merely the creature and instrumentality of the Local.

[240]*240Their joint pleading alleges that the “sole purpose of the said [Association] which was created by and with the funds of Local 9 was to provide a convenient method for the holding [of] title, for and on behalf of said Local 9, to real property owned, as well as to real property later to be acquired, by Local 9.” And further, “that [the Association] holds bare legal title as Trustee, on behalf of and for the benefit of Local 9, . . . and that Local 9 is the real and beneficial owner of said property.” The National Union and Local 9 urge that the Association is functus officio and that it should be ordered to convey to Local 9 the assets to which it holds only bare legal title.

As will become evident from our further discussion, a decision upon the issues presented by the pleadings and the proof necessarily required determination of the true nature of the legal relationships of the entities inter se and their respective powers, rights and duties as created by their charters and bylaws as well as those existing by reason of the application of general principles of law.

The adjudication of this dispute required a judicial determination of (1) the legal status and purpose of the Association; and (2) its legal rights and duties with respect to the ownership, management and control of the real property which had been conveyed to it and title to which stood in its name.

The Decision of the Trial Court

The judgment of the trial court determined that respondent Association was a nonprofit corporation, but not a charitable one, and therefore was not subject to regulation by the Attorney General. This determination is not questioned. The Attorney General, being in reality only a nominal defendant, is not a party to this appeal.

The trial court found and held, not only that the legal title to the property described in the complaint resided in the Association, but also that the Association was in fact the owner thereof in its own right and that Local 9 and the National Union had no right, title or interest in said real property and were entitled to no relief.

We believe that direct quotation from the judgment against which appellants Local 9 and the National Union are now directing their attack will greatly serve the interests of clarity and accuracy of understanding. It will be noted that respondent Association is referred to as “plaintiff corporation” in [241]*241the significant provisions of the judgment declaring as follows:

“VII. That plaintiff corporation has the right to set up and keep records and accounts of its corporate affairs and that it is its duty to do so. That the defacto directors are hereby directed to commence keeping records and accounts of the corporate affairs of plaintiff corporation as soon as may be practicable.
“VIII. That plaintiff corporation is authorized through its officers and directors to manage and control its property. That the defacto directors are hereby directed to develop a plan to manage and control the property of plaintiff corporation.
“IX. That title to the property described in plaintiffs’ complaint is in plaintiff corporation and plaintiff corporation is the owner thereof.
“X. That it is the duty of the defacto directors of plaintiff corporation to hold a meeting of the members of plaintiff corporation as soon as practicable for the adoption of by-laws, the election of officers and directors and for such other purposes as may lawfully come before such meeting. The defacto directors of plaintiff corporation are hereby ordered and directed to hold a membership meeting for the purpose of adoption of by-laws, election of officers and directors and for such other purposes as may lawfully come before such meeting as soon as practicable. It is the duty of the intervenors to supply the defacto directors of plaintiff corporation and plaintiff corporation with the names and addresses of members of plaintiff corporation who are also members of Local 9. The intervenors are hereby ordered and directed to furnish and make available to the defacto directors of plaintiff corporation and plaintiff corporation with the names and addresses of the members of plaintiff corporation as soon as practicable. It is the duty of the intervenors to furnish plaintiff corporation with a written inventory of the assets of plaintiff corporation in the possession or control of the intervenors. The intervenors are hereby directed and ordered to furnish plaintiff corporation with a written inventory of the assets of plaintiff corporation in the possession or control of the intervenors.
‘‘ That the intervenors have no right, title or interest in the real property described in the complaint, and that the intervenors are not entitled to any relief upon their complaint in intervention. ’ ’

[242]*242 Summary Statement of the Evidence.

Since there is no material conflict in the evidence, the facts disclosed by the comparatively limited record are essentially undisputed.

It appears that in 1943, the affairs of Local 9 were being administered by a Mr. Pollard under the jurisdiction of the National Union. It was decided at that time that it would be desirable to acquire a meeting hall for the organization and to purchase the property with accumulated funds of the Local.

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250 Cal. App. 2d 238, 58 Cal. Rptr. 283, 1967 Cal. App. LEXIS 2099, Counsel Stack Legal Research, https://law.counselstack.com/opinion/shipyard-workers-educational-assn-v-lynch-calctapp-1967.