State v. United Fraternal Order of Peace Officers Ass'n

588 S.W.2d 104, 1979 Mo. App. LEXIS 2519
CourtMissouri Court of Appeals
DecidedSeptember 4, 1979
DocketNo. KCD 29871
StatusPublished

This text of 588 S.W.2d 104 (State v. United Fraternal Order of Peace Officers Ass'n) is published on Counsel Stack Legal Research, covering Missouri Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
State v. United Fraternal Order of Peace Officers Ass'n, 588 S.W.2d 104, 1979 Mo. App. LEXIS 2519 (Mo. Ct. App. 1979).

Opinion

TURNAGE, Judge.

The State at the relation of the Attorney General filed an information in the nature of a quo warranto by which it sought the forfeiture of the right of United Fraternal Order of Peace Officers Association, Inc., to do business in this State. The court dissolved all of the corporate rights, privileges and franchises of Peace Officers in this State and appointed a receiver to take charge of its affairs.

On this appeal Peace Officers contend there was insufficient evidence to support the court’s judgment. Affirmed.

Peace Officers was first incorporated as a not for profit corporation in the District of Columbia in June, 1972, by Rose Mary Evans; Glen W. Evans, her husband; and Myer Koonin. Among the purposes of the corporation was (a) to make safe and secure the streets of cities throughout the United States; (b) to recruit students for education and training programs; (c) to recruit and assist in placement of volunteers to work with the corporation; and (d) to serve as a communications clearing house to publicize worthwhile activities and to issue a newsletter and other publications.

In February, 1973, the Secretary of State of Missouri issued a certificate of authority under Chapter 355, RSMo 1969, authorizing United Fraternal Order of Peace Officers Association as a foreign corporation to do business as a not for profit corporation in [105]*105Missouri. The stated purposes of the corporation were identical with the purposes stated in the original incorporation in the District of Columbia.

In September, 1976, the Attorney General filed an information in the nature of a quo warranto seeking to forfeit the right of Peace Officers to do business in Missouri. The information alleged none of the corporation’s activities or funds had been directed or expended to accomplish the purposes set forth in its application to do business in Missouri, but, in fact, its activity and funds had been directed and expended for the use and benefit of the officers and directors of the corporation in excess of reasonable compensation for services rendered. The information also alleged misrepresentation on the part of telephone solicitors working for the corporation in soliciting ads for a yearbook when they stated the proceeds from the publication would be used to pay death benefits for police officers killed in the line of duty.

The evidence revealed that Glen W. Evans and Rose Mary Evans established an office for Peace Officers in Gladstone. The principal activity carried out by the Evans was the employment of a number of telephone solicitors who solicited both in the metropolitan Kansas City area and by WATS line to other areas for ads to be carried in a Peace Officers yearbook. Glen acted as a telephone solicitor and Rose Mary principally handled the office routine. In addition, there were bookkeepers and accountants who kept the books but Rose Mary was the only person authorized to write checks. Until early 1977 the telephone solicitors stated the proceeds from the ads were used to pay death benefits for police officers who were killed in the line of duty.

About 1974, the Evans established Fortune Enterprises as an unincorporated entity. Rose Mary said Fortune was established to handle the publication of the yearbook and to pay the expenses connected therewith. Telephone solicitors were paid 25% of the amount of ads they sold and collectors were paid 20% of the amount they received in picking up ad payments.

The Evans also operated two other organizations: The United Fraternal Order of Fire Fighters and The Future Fire Fighters of America. Yearbooks were published for these organizations in addition to the Peace Officers Yearbook. The telephone solicitors solicited ads for each yearbook. A yearbook was published for Missouri and apparently other yearbooks were published in other parts of the country. The Peace Officers Yearbook for 1975 was published in paperback and consisted of 224 pages. The entire book consisted of box ads which simply gave the name and address of various businesses in Missouri. There were a few articles reprinted from other publications, but the only original literary effort was two messages from Rose Mary Evans. There was nothing in the yearbook which would assist any peace officer in the performance of his duty which was not readily available from other sources. There was no evidence as to how many yearbooks were published.

To demonstrate the success of the operation, Fortune Enterprises received $189,-014.58 in revenue for ads to be placed in the 1975 Peace Officers Yearbook. There is no evidence when the 1975 yearbook was published, but Rose Mary said the yearbooks were always at least a year behind and at trial in 1977 stated the 1976 yearbook was at the printers. The expenses for the 1975 yearbook were not shown but Fortune paid Peace Officers about 5% of the amount it received, or $9,415 in royalties. Rose Mary said the amount of royalty paid Peace Officers was fixed by her accountant and she disclaimed any knowledge of how he arrived at the percentage. The accountant did not testify.

For the first ten months of 1976 Fortune received $196,800 from Peace Officers ads and incurred $159,000 in expenses. The amount of royalty to be paid Peace Officers for the 1976 yearbook had not been determined by the accountant at the time of trial.

Glen Evans died in 1976. It is a fair inference from the evidence that both before and after the death of Glen, the Evans [106]*106placed all of the revenue received from ads in a bank account controlled by Fortune Enterprises. Money was in turn placed in bank accounts for the Peace Officers and Fire Fighters, but Rose Mary was the only person who wrote checks on those accounts and frequently wrote checks for personal expenses on the Peace Officers account as well as shifted money from one account to another as she might need money in a particular account. Rose Mary stated she had no set salary but simply wrote checks for her personal needs on any of the bank accounts which had money in them and noted on the check it was personal. Her needs at one time included payments on her Lincoln Mark IV.

Rose Mary stated none of the board of directors of Peace Officers was active in the organization. No meeting of the board of directors nor of the membership appears to have been held. It was stipulated at trial that in 1977 there were 101 members of Peace Officers who had paid the yearly dues of $11. Of this, only 9 were from Missouri.

There was evidence that Peace Officers paid $500 in 1973 to Johnson County, Kansas, for a drug program, and in 1975, Fortune paid $625 in death benefits for a police officer and this amount was later repaid from the Peace Officers account. In 1976, $850 was paid from the Peace Officers account for death benefits. Those were the only sums paid in death benefits.

In September, 1973, Glen and Rose Mary purchased property in St. Clair County near Osceola for the stated purpose of establishing a Peace Officers Hall of Fame and recreational area. The title to the property was taken in the names of Glen and Rose Mary and the purchase price of $9,456.71 was paid by Fortune. It was only after the information herein was filed that Rose Mary conveyed title to Peace Officers to part of the property and the remainder to Fire Fighters. Peace Officers paid Fortune $7,987.93 toward the purchase price.

It is more than apparent that the Peace Officers Corporation was operated solely by the Evans for the purpose of selling advertising in a yearbook to make a profit for themselves.

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Related

State Ex Inf. Otto v. Kansas City College of Medicine & Surgery
285 S.W. 980 (Supreme Court of Missouri, 1926)
State Ex Rel. Otto v. St. Louis College of Physicians & Surgeons
295 S.W. 537 (Supreme Court of Missouri, 1927)

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Bluebook (online)
588 S.W.2d 104, 1979 Mo. App. LEXIS 2519, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-v-united-fraternal-order-of-peace-officers-assn-moctapp-1979.