Wells v. Fandal

136 So. 3d 83, 13 La.App. 5 Cir. 620, 2014 WL 553431, 2014 La. App. LEXIS 308
CourtLouisiana Court of Appeal
DecidedFebruary 12, 2014
DocketNo. 13-CA-620
StatusPublished
Cited by14 cases

This text of 136 So. 3d 83 (Wells v. Fandal) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wells v. Fandal, 136 So. 3d 83, 13 La.App. 5 Cir. 620, 2014 WL 553431, 2014 La. App. LEXIS 308 (La. Ct. App. 2014).

Opinion

ROBERT M. MURPHY, Judge.

l2On June 1, 2012, plaintiff John B. Wells filed1 a “petition for declaratory judgment, quo warranto, injunctive relief, damages and to appoint a corporate receiver.”2 Wells asserted that the Alliance for Good Government, Inc., its Board of Directors, and its chairman, Timothy Fandal, illegally removed him from his one-year position on the Alliance for Good Government’s Board and expelled him from membership.

At the May 3, 2013 hearing, the trial court sustained defendants Alliance for Good Government, Inc. (“Alliance”) and Fandal’s (collectively “defendants”) exceptions of no right of action and mootness, dismissing all of plaintiffs claims with prejudice except for defamation; sustained defendants’ exception of lack of |sprocedural capacity as to the “Board,” the “Secretary,” and “Treasurer,”3 dismissing them with prejudice; sustained defendants’ exception of no cause of action against chairman Fandal, dismissing claims against him individually with prejudice; sustained defendants’ exception of vagueness with respect to the defamation [85]*85claim, giving plaintiff 15 days from May 9, 2018 to amend and state his claim for defamation; mooted defendants’ exceptions of improper cumulation and improper use of a summary proceeding; denied plaintiffs motion to compel and to deem facts admitted; and deferred defendants’ motion for a protective order.

On May 9, 2013, the trial court entered a judgment without assigning reasons. On May 22, 2013, Wells filed a devolutive appeal from the trial court’s rulings on the exceptions of no right of action and mootness, writ of quo warranto, exception of no cause of action, exception of lack of procedural capacity, and plaintiffs motion for discovery. Defendants answered the appeal seeking this Court’s ruling on their exceptions of improper cumulation and improper use of a summary proceeding.4 For the following reasons, we affirm.

FACTS AND PROCEDURAL HISTORY

On December 13, 1967, the Alliance was organized as a non-profit corporation under the laws of the State of Louisiana with the filing of its articles of incorporation. The Alliance’s articles have remained unchanged with its bylaws last amended in 2005. The Alliance is active in four parishes including St. Tammany.

In late 1999, Wells became a member of the St. Tammany Chapter of the Alliance and served as Vice-President of that Chapter for six months in 2002. In November of 2006, he was elected President of the St. Tammany Chapter and took 14office in January of 2007. In November of 2008, he was re-elected. In August of 2010, plaintiff made a statement to a board member which resulted in an ethics complaint. Plaintiff contended he was then exonerated by the Alliance’s ethics eom-mittee, though he admitted he was reprimanded.

In November of 2011, the St. Tammany Chapter elected Wells to the Alliance’s board. On January 19, 2012, the board in executive session voted not to seat him on the board. In March of 2012, the board then voted to expel him from membership.

On June 1, 2012, Wells filed a petition for declaratory judgment, quo warranto, injunctive relief, damages and to appoint a corporate receiver. Named defendants were Timothy Fandal, chairman of the board of the Alliance for Good Government, the Board of Directors of the Alliance of Good Government, the Alliance for Good Government, and the Alliance for Good Government, Inc. (“Alliance”).

Plaintiff questioned the authority of the board to act. He further contended that the articles and bylaws, both attached to the petition, are inconsistent as to the number of directors required to serve on the board. In fact, the articles provide for a board comprised of five directors, and the bylaws, a board of nine. It is undisputed that the size of the board, which acted to deny plaintiff his seat on the board and expel him from membership, was comprised of nine members.5

Plaintiff sought court appointment of a temporary and permanent receiver under La. R.S. 11:258, et seq., contending that the Directors were grossly mismanaging the corporation and committing ultra vires acts. Wells specifically complained of the actions the purported board had taken against him in refusing to | 5seat him and expelling him from the Alliance’s membership. Plaintiff sought a writ of quo war-ranto if the trial court found the board properly constituted.

[86]*86Plaintiff contended that the board’s actions were improper and illegal. He first argued that the board was improperly constituted, rendering the actions of the nine-member board null. Plaintiff contended that the board itself had no authority to remove or appoint a director except to fill a vacancy, and thus its actions were null.

Plaintiff further cited Alliance bylaws which incorporated Robert’s Rules of Order for its ethics committee procedures. He alleged specifically that Robert’s Rules required that a matter be dropped if the member was exonerated by the ethics committee; additionally, under Robert’s Rules, the matter would have had to have been referred to the general membership and not to the board for a vote on his expulsion from membership.

Wells contended that defendants failed to comply with the articles and bylaws and in doing so breached their fiduciary duties to its members. Plaintiff further sought a temporary and permanent receiver to effect the Alliance’s compliance with the articles and bylaws.

Plaintiff claimed that the board, secretary, and treasurer, “acting on behalf of the Board,” provided false and defamatory information to the Board of Directors that plaintiff “derailed the forum rules from being put into action.” Plaintiff further sought injunctive relief, again on the basis that the board was operating in violation of the corporate articles and bylaws.

Plaintiff prayed for the court to restore his membership in the Alliance; to nullify all actions of the board taken without his notice, participation, and deliberation; to conduct a show cause hearing to appoint a temporary receiver and after trial appoint a permanent receiver; to restore Wells to a one-year term on the [ f,board as its St. Tammany representative; to issue a permanent injunction after trial, restraining the chairman and the board from violating the articles, bylaws, and Louisiana’s nonprofit corporation law; to award damages after trial for defamation as proven; and to award costs.

On July 20, 2012, defendants Alliance and Fandal filed exceptions of improper venue, lack of procedural capacity and no cause of action. On July 24, 2012, defendants added exceptions of vagueness, improper cumulation of actions, and improper use of summary procedure. On April 12, 2013, defendants filed exceptions of no right of action and mootness.

On May 22, 2013, Wells filed a devolu-tive appeal from the May 9, 2013 judgment, which was granted on May 23, 2013.

ASSIGNMENTS OF ERROR

On appeal, plaintiff assigns the following errors by the trial court:

One6: the trial court erred in granting the defendants’ exception of no right of action. Appellant contends that he had standing and that the trial court erred in not ruling on his status as a member, a threshold matter in determining whether he had a right of action.

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136 So. 3d 83, 13 La.App. 5 Cir. 620, 2014 WL 553431, 2014 La. App. LEXIS 308, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wells-v-fandal-lactapp-2014.