Justia Non-Profit Corporations Opinion Summaries

The Boys & Girls Clubs of South Alabama, Inc. ("the Club"), a nonprofit corporation, appealed a judgment entered in favor of the Fairhope-Point Clear Rotary Youth Programs, Inc. ("Rotary Inc."), and the Ruff Wilson Youth Organization, Inc. ("Wilson Inc."), in their action against the Club seeking declaratory and injunctive relief. In 1996, B.R. Wilson, Jr., one of the incorporators of the Club and a principal benefactor, executed a "gift deed," transferring to the Club approximately 17 acres of real estate ("the property"). In March 2000, the Club sold the property and deposited the proceeds into three separate accounts, two of which were separately earmarked for the Daphne Club and for the Fairhope Club. However, in 2009, the Club discontinued its operations in Daphne and Fairhope, citing "operating deficits" as a contributing factor. It transferred the remainder of the proceeds from the sale of the property to an account in the Community Foundation of South Alabama ("the bank"). Later that year, the facilities in Daphne and Fairhope were reopened by volunteers and former Club personnel, who began operating the youth centers under their own independent management structures. Subsequently, some of these individuals incorporated Rotary Inc. and Wilson Inc., under which they continued to operate the facilities in Fairhope and Daphne, respectively. Rotary Inc. and Wilson Inc. sued the Club, seeking declaratory and injunctive relief, alleging that the Club "ha[d] used," or, perhaps, was "anticipat[ing] using," the proceeds for its own operations, rather than for the use of the facilities then being operated by Rotary Inc. and Wilson Inc. They sought a judgment: (1) declaring that the "desire and understanding" of B.R. Wilson expressed in the letter controlled the disposition of the funds, and (2) enjoining the use of the proceeds for anything but the benefit of the youth facilities as operated by Rotary Inc. in Fairhope and by Wilson Inc. in Daphne. The court ordered the termination of the "trust" and the disbursal of the remainder of the proceeds to Rotary Inc. and Wilson Inc., respectively. The Club appealed, challenging, among other things, the standing of Rotary Inc. and Wilson Inc. to sue over distribution of the proceeds of the sale of the property. Upon review, the Supreme Court concluded that Rotary Inc. and Wilson Inc. failed to show that they had standing to challenge the Club's disposition of the proceeds of the sale of the property donated to the Club by B.R. Wilson, Jr. Therefore, the trial court's judgment was void for lack of subject-matter jurisdiction. Accordingly, the Court vacated the judgment and dismissed the case and the appeal. View "Boys & Girls Clubs of South Alabama, Inc. v. Fairhope-Point Clear Rotary Youth Programs, Inc." on Justia Law

This case centered on whether the recreational use immunity statute, RCW 4.24.200-.210, applied under the circumstances where a landowner, who otherwise operates an admission fee-based camp, allows a group access for no charge. During the group’s stay at the camp, plaintiff was injured when riding a slide on the property. The camp asserted recreational use immunity as a defense to the claim. On summary judgment, the trial court ruled that the camp was not immune from liability under the statute because it normally charged fees for the recreational use. This interlocutory appeal was certified after the trial court found there was likely a substantial ground for difference of opinion. Upon review, the Supreme Court affirmed and held that recreational use immunity is not available under these circumstances because the property was not open to the general public. View "Cregan v. Fourth Mem'l Church" on Justia Law

The Bridgewater State University Foundation owns three buildings and three undeveloped parcels. One building is occupied by foundation offices and the university's alumni office; another houses the university's political science department; and the third is used by the university and the foundation for receptions and fundraising. The undeveloped parcels are used by students for recreation. None of the properties is used exclusively by the foundation. The foundation permits the university to use all the properties free of charge. The Appellate Tax Board decided that the foundation was entitled to the charitable exemption from local property taxes, G.L. c. 59, Sect. 5; the Appeals Court reversed. The Massachusetts Supreme Court concluded that the foundation is entitled to the exemption. The foundation is a public charitable trust, and it is "organized and operate[s] exclusively for the benefit of" Bridgewater State University under G.L. c. 15A, sect. 37. The foundation has qualified as a tax-exempt organization under section 501(c)(3) of the Internal Revenue Code. The university is an institution of public higher education and certifies that the foundation is operating "in a manner consistent with" the university's goals and policies and uses its money and assets solely for the benefit of the university. View "Bridgewater State Univ. Found. v. Bd. of Assessors of Bridgewater" on Justia Law

The court granted wife's application for discretionary appeal from the final judgment and decree of divorce. At issue was the equitable division of a closely-held non-profit corporation. The court concluded that the superior court functioned as the finder of fact, and as such, it was authorized to give credit and weight to the disputed evidence in favor of husband. The court also concluded that wife's complaints that the superior court erred in failing to consider her request for attorney fees and to award them to her because husband refused to comply with discovery and/or there was substantial disparity in the parties' financial circumstances was unavailing. View "Jones-Shaw v. Shaw" on Justia Law

Plaintiff, a Virginia non-profit corporation organized under section 527 of the Internal Revenue Code, commenced this action against the Commission and the Department of Justice, contending that it was "chilled" from posting information about then-Senator Obama because of the vagueness of a Commission regulation and a Commission policy relating to whether plaintiff had to make disclosures or was a "political committee." Plaintiff asserted that it was not subject to regulation but feared the Commission could take steps to regulate it because of the vagueness of 11 C.F.R. 100.22(b) and the policy of the Commission to determine whether an organization was a political action committee by applying the "major purpose" test on a case-by-case basis. Plaintiff alleged that the regulation and policy were unconstitutionally broad and vague, both facially and as applied to it, in violation of the First and Fifth Amendments. The court applied the "exacting scrutiny" standard applicable to disclosure provisions and affirmed the district court's finding that both the regulation and the policy were constitutional. View "The Real Truth About Abortion, Inc. v. Federal Election Commission" on Justia Law

In 1995, two non-profit hospitals consolidated to form Pinnacle. Pinnacle subsequently submitted a Medicare reimbursement claim for the losses the hospitals had incurred through the sale of their depreciable assets in the consolidation. The Administrator denied Pinnacle's claim, and that order became the final decision of the Secretary. On Pinnacle's Administrative Procedure Act (APA), 42 U.S.C. 12101 et seq., challenge, the district court upheld the Secretary's decision in full. Because the Secretary's interpretation of the relevant Medicare regulations was not plainly erroneous or inconsistent with the regulation, the court concluded that the Secretary reasonably applied the bona fide sale requirement to a reimbursement request from a participant in a "statutory merger." The court also held that the Secretary's finding that the bona fide sale requirement applied to consolidations involving non-profit Medicare providers, like Pinnacle, was not plainly erroneous or inconsistent with the regulation. Finally, substantial evidence supported the Secretary's finding that Pinnacle did not satisfy the bona fide sale requirement. Accordingly, the court affirmed the district court's judgment. View "Pinnacle Health Hospitals v. Sebelius" on Justia Law

Appellant Mesivtah Eitz Chaim of Bobov, Inc., a not-for-profit religious entity related to the Bobov Orthodox Jewish community in Brooklyn, appealed a Commonwealth Court ruling, asking that the Supreme Court find it is an "institution of a purely public charity" under Article VIII, sec. 2(a)(v) of the Pennsylvania Constitution, and entitled to exemption from real estate taxes. Appellant operated a summer camp in Pike County, Pennsylvania. Pike County denied Appellant's exemption request, finding that occasional use of Appellant's recreational and dining facilities by Pike County residents was insufficient to prove Appellant was a purely public charity. The Court allowed this appeal to determine if it must defer to the General Assembly's statutory definition of that term. Upon review, the Supreme Court affirmed, holding its prior jurisprudence set the constitutional minimum for exemption from taxes; the legislation may codify what was intended to be exempted, but it cannot lessen the constitutional minimums by broadening the definition of "purely public charity" in the statute. View "Mesivtah Eitz Chaim of Bobov, Inc. v. Pike Co. Bd. of Assessment Appeals" on Justia Law

This case addressed the effect of a pooled special-needs trust created by an over-65-year-old beneficiary on his medicaid benefits. The Center for Special Needs Trust Administration appealed a summary judgment in favor of the North Dakota Department of Human Services. Invoking 42 U.S.C. 1983 and the Constitution's Supremacy Clause, the Center alleged that North Dakota's demand for reimbursement and its state regulations violated a paragraph of the Medicaid Act, 42 U.S.C. 1396p(d)(4)(C). The court held that the district court properly determined that section 1396p(d)(4)(C) afforded the Center a right of action under section 1983; that North Dakota did not waive its claim to recover for reimbursements and should not be estopped from making that claim; that the Center's claim was without merit; and that preemption did not apply. View "Center for Special Needs, etc. v. Olson, etc." on Justia Law

The district court ordered the Governor of the State of New York and various state commissioners and agencies to make certain modifications to the State's mental health system to ensure compliance with 28 C.F.R. 35.130(d) - the so-called "integration mandate" of Title II of the Americans with Disabilities Act, 42 U.S.C. 12132, and Section 504 of the Rehabilitation Act, 29 U.S.C. 794. The court held that DAI, a nonprofit organization contracted to provide services to New York's Protection and Advocacy System under the Protection and Advocacy for Individuals with Mental Illness Act, 42 U.S.C. 10801 et seq., lacked standing under Article III to bring the claim. The court also held that the intervention of the United States after the liability phase of the litigation had concluded was insufficient to cure the jurisdictional defect created by DAI's lack of standing. Therefore, the court vacated the judgment and remedial order and dismissed for want of jurisdiction. View "Disability Advocates, Inc. v. New York Coalition for Quality Assisted Living, Inc, et al." on Justia Law

Plaintiff Roland Davis had been a resident of the Devereux New Jersey Center (operated by Defendant Devereux Foundation) since shortly before his twelfth birthday. Plaintiff was diagnosed with autism, mental retardation, pervasive developmental disorder and attention deficit hyperactivity disorder, and had a history of combative and aggressive behavior. Plaintiff's mother (as his guardian) filed a complaint alleging breach of a "non-delegable duty" to protect Plaintiff from harm, negligent care and supervision, and vicarious liability after a counselor assaulted Plaintiff. The trial court granted Devereux's motion for summary judgment, finding that to the extent claims were for negligence, they were barred by the Charitable Immunity Act (CIA). The court further concluded that New Jersey law does not compel imposing a "non-delegable duty" upon Devereux. The Appellate Division affirmed in part, also finding no "non-delegable duty," and reversed in part, holding that a reasonable jury could find that the counselor acted in part within the scope of her employment. The issues on appeal to the Supreme Court were: (1) whether to impose upon an institution that cares for developmentally disabled residents a "non-delegable duty" to protect them from harm caused by employees' intentional acts; and (2) whether the employee in this case could be found to have acted within the scope of her employment when she criminally assaulted the resident, thereby subjecting the non-profit facility to liability pursuant to "respondeat superior." The Court reaffirmed the duty of due care imposed upon caregivers with in loco parentis responsibilities to persons with developmental disabilities. However, applying the analysis set forth and developed by prior opinions, the parties' relationship, the nature of the risk, the opportunity and ability to exercise care, and public policy, the Court concluded the circumstances of this case did not justify imposing on caregivers a "non-delegable duty" to protect residents from harm caused by employees' intentional acts. Furthermore, the Court held that no rational factfinder could find that the Devereux counselor's criminal assault on Plaintiff was conducted within the scope of her employment. View "Davis v. Devereux Foundation" on Justia Law