Hoffman v. Sierra Club

(Sup. Ct. N.Y. Cty. 5/29/85)

We represented: Respondent

We represented: Burton Sherman, J.

DECISION and ORDER The plaintiff in this action seeks a judgment nullifying the 1984 election of at-large members of the Board of Governance of the Atlantic Chapter of the Sierra Club, a not-for-profit corporation, and directing new elections. The plaintiff commenced this action by service of a summons and complaint, pursuant to an order to show cause, by personally serving Pamellia Waywod, the chairperson of the Atlantic Chapter.

This dispute arises from two factions competing in the election of four at-large seats on the Board of Governance of the Atlantic Chapter. The plaintiff, at the time a member of the Board of Governance, was a supporter of a group of candidates called the New Era Slate while the chairperson allegedly supported the other faction.

The proper method for challenging an election of a not-for-profit corporation is by a proceeding brought pursuant to the Not-for-Profit Corporation Law § 618. While this action is therefore improper, rather than dismissing this action, this court will convert it into a proceeding since a civil action may not be dismissed solely because it is not brought in the proper form.

The respondent cross-moves to dismiss this proceeding on various grounds. The respondent alleges that the Atlantic Chapter of the Sierra Club is not a legal entity and therefore service of process upon the chairperson of the chapter does not confer jurisdiction over the Sierra Club. The Sierra Club is a non-profit corporation existing under the Nonprofit Public Benefit Corporation Law of California. This court finds that whether or not the Sierra Club is authorized to conduct business in New York as a foreign corporation, it is nevertheless amenable to the jurisdiction of this court. The Sierra Club is conducting activities in New York through its Atlantic Chapter as all members of the Sierra Club living in New York automatically are deemed members of its Atlantic Chapter. The caption of this proceeding is hereby amended to include the Sierra Club as a party respondent. This court also finds that service of process upon the chairperson of the Atlantic Chapter was valid service of process. A special proceeding may be commenced by order to show cause in lieu of a notice of petition, therefore this petitioner's compliance with the time and manner of service specified in the order to show cause effectuated valid service.

The respondent next maintains that this petition must be dismissed as notice of this proceeding was not given to the persons declared elected as required by N-PCL § 618. This court finds that the elected at-large members did have notice of this proceeding as copies of the petitioner's summons and complaint given to the electees at the Board of Governance meeting held to confirm the results of this election.

The petition however must be dismissed as the conclusory allegations fail to demonstrate any fraud, wrongdoing or that standards of fair dealing require the court to order a new election. The petition alleges various grounds for which the election must be vacated. The allegations basically are that the Schenectady area of the Atlantic Chapter were sent ballots meant for other members and that the chairperson failed to maintain impartiality with respect to the election. The irregularity with respect to the ballots mailed to the Schenectady area was due to a clerical error and the petition fails to allege any facts showing that if this slight irregularity was corrected it would change the result of the election.

In fact, the evidence indicates that the mix-up in the Schenectady mailing did not prevent these members from voting as the percentage of members in this area who voted was as high as the chapter-wide percentage of voters.

The allegation that the chairperson supported candidates in opposition to the slate of candidates supported by petitioner fails to show that the election was not conducted legally and fairly. The courts should not interfere with internal corporate affairs where as here there is no showing of fraud or wrongdoing (see Re: Election of officers and Directors of F.I.G.H.T., Inc., 79 Misc. 2d 655); otherwise, the courts would soon find themselves the arbiter of every corporate election. The fact that someone is dissatisfied with the results of an election is not valid grounds for nullifying such election.

This court also finds that petitioner was not a proper party to bring this proceeding. The petitioner was neither a candidate for at‑large seats nor was he prevented from voting in the election. The petitioner therefore failed to demonstrate that he was aggrieved by the election, a necessary prerequisite to maintaining a N-PCL § 61 proceeding.

Accordingly, the petition is dismissed and the result of the election of the at-large members of the Board of Governance of the Atlantic Chapter of the Sierra Club is confirmed.

Settle judgment.