Cavin Memorial Corp. v. Requa

• Decision Date: 12 March 1970
• Docket Number: FULTON-EL,EL-CAMINO
• Court: California Court of Appeals Court of Appeals
• Parties: CAVIN MEMORIAL CORPORATION, Plaintiff and Appellant, v. George W. REQUA et al., Defendants and Respondents.CAMINO RECREATION AND PARK DISTRICT, Plaintiff and Respondents, v. CAVIN MEMORIAL CORPORATION etc., Defendant and Appellant. FULTONRECREATION AND PARK DISTRICT, Plaintiff, Respondent and Appellant, v. Lawrence A. WINN and Oliver Q. Foust, Defendants and Respondents, Cavin Memorial Corporation etc., Defendant, Appellant and Respondent. BOHEMIAN VILLAGE TENNIS CLUB, INC., et al., Plaintiffs and Respondents, v. CAVIN MEMORIAL CORPORATION etc., Defendant and Appellant. Civ. 12245 to 12248.

Page 107

85 Cal.Rptr. 107

5 Cal.App.3d 345

CAVIN MEMORIAL CORPORATION, Plaintiff and Appellant, v. George W. REQUA et al., Defendants and Respondents.

FULTON-EL CAMINO RECREATION AND PARK DISTRICT, Plaintiff and Respondents, v. CAVIN MEMORIAL CORPORATION etc., Defendant and Appellant.

FULTON EL-CAMINO RECREATION AND PARK DISTRICT, Plaintiff, Respondent and Appellant, v. Lawrence A. WINN and Oliver Q. Foust, Defendants and Respondents, Cavin Memorial Corporation etc., Defendant, Appellant and Respondent.

BOHEMIAN VILLAGE TENNIS CLUB, INC., et al., Plaintiffs and Respondents, v. CAVIN MEMORIAL CORPORATION etc., Defendant and Appellant.

Civ. 12245 to 12248.

Court of Appeal, Third District, California.

March 12, 1970.

Rehearing Denied April 6, 1970.

Hearing Denied May 6, 1970.

Max H. Hoseit, Skirving & Thompson by Carl M. Stein, Sacramento, for plaintiff-appellant.

Files & McMurchie, by Donald W. McMurchie, Sacramento, for defendants-respondents.

BRAY, Associate Justice (Assigned).

Cavin Memorial Corporation of Town & Country Village (hereinafter 'Cavin Memorial') appeals from judgments in four superior court actions consolidated for trial. Fulton-El Camino Recreation and Park District, a political subdivision (hereinafter 'District') appeals from the judgment in superior court action No. 171596 (3 Civil No. 12247).

The basic issue in all the actions is the ownership of the legal title to certain real property in Del Paso Park View Tract No. 1 (hereinafter 'Del Paso Tract') and in Bohemian Village Addition No. 1 (hereinafter 'Bohemian Village') in Sacramento County, which, in turn, depends primarily upon the corporate existence of Bohemian Village Tennis Club, Inc. (hereinafter 'Tennis Club') and the validity of its actions.

THE ACTIONS

1. Superior court action No. 167987 (3 Civil No. 12246) Fulton-El Camino Recreation and Park District v. Cavin Memorial Corporation etc.; action to quiet title to a portion of Del Paso Tract; cross-complaint by Cavin Memorial to quiet title. Judgment was entered quieting the District's title and determining that Cavin Memorial had no interest in the property. Cavin Memorial appeals.

2. Superior court action No. 172011 (3 Civil No. 12248) Bohemian Village Tennis Club, Inc., George W. Requa, William B. Chase and Virginia L. Small v. Cavin Memorial Corporation etc., Lawrence A. Winn, Oliver Q. Foust, Thomas C. Lynch, Attorney General of the State of California; action to quiet title to certain property in Del Paso Park View Tract No. 1, and to terminate all claims of others to certain real property it had conveyed to the District. The first count sought to set aside certain deeds executed by Jere Strizek and Jessie Dow Cavin; the second count was to set aside a 1962 judgment obtained by Cavin Memorial as plaintiff in a quiet title action; the third count was to set aside a deed to Cavin Memorial from Winn and Foust as purported officers of Tennis Club; and the fourth count was to establish a charitable trust in the real property and to cancel the Winn-Foust deed as being in violation of the trust. The trial court gave judgment quieting title in Tennis Club and its grantee, District. The judgment was silent as to the other relief sought by the complaint. Cavin Memorial appeals.

3. Superior court action No. 167870 (3 Civil No. 12245) Cavin Memorial Corporation etc. v. George W. Requa and Virginia L. Small; action for slander of title because of execution of a certain deed and to cancel that deed; judgment for defendants. Cavin Memorial appeals.

4. Superior court action No. 171596 (3 Civil No. 12247) Fulton-El Camino Recreation and Park District v. Winn, Foust and Cavin Memorial Corporation etc,; action for slander of title and conspiracy to slander title. The court gave judgment in favor of defendants. District appeals. Cavin Memorial also appeals. Inasmuch as Cavin Memorial is not an aggrieved party, its appeal must be dismissed.

EVIDENCE

The common grantors of all the parties claiming title were C. M. Coffing and Grace Coffing, his wife, who on November 25, 1941, owned the subject real property. On that day they executed, and on December 2, 1941, recorded, a certain 'Declaration of Restrictions,' declaring among other restrictions not pertinent here, that Lots 148 and 149 of Del Paso Tract and Lot A of Bohemian Village were to be used and maintained for drainage and septic tank absorption fields and for recreation purposes for the benefit of the owners and their successors in interest of land situated in Bohemian Village. All conveyances of lots in said tract were to be subject to said restrictions.

August 1, 1941, Tennis Club was incorporated as a nonprofit social and recreational association. By deeds dated September 18, 1945, and August 3, 1949, the Coffings conveyed to Tennis Club the above described property. On August 22, 1962, Cavin Memorial obtained a superior court judgment quieting its title to the property against certain persons. Although Tennis Club was purportedly joined as a defendant in the action, it was not served personally with process nor did it appear in the action.

On December 10, 1963, Jessie Dow Cavin (who had resigned as director on December 26, 1957) as 'President' of the Tennis Club executed a deed to herself of Tennis Club's property less the westerly 100 feet thereof. This deed was not recorded. On June 10, 1964, the Coffings (although in 1945 and also in 1949 they had executed deeds to Tennis Club) executed a grant deed of the property, less Lot A, to Cavin Memorial. This deed was recorded October 15, 1965. On March 21, 1966, Tennis Club purported to execute a grant deed conveying the property, less the westerly 100 feet, to Cavin Memorial. On April 1, 1966, Tennis Club purported to execute a deed of the property, less Lot A, to District.

It will be noted that the Coffings, the original owners of the property, executed two deeds, which together totaled all the property, to Tennis Club; that there were three deeds purporting to be conveyances out of Tennis Club. (1. Deed of Jessie Dow Cavin as 'President'; 2. Deed purporting to be executed by Tennis Club to Cavin Memorial; and 3. Deed of Tennis Club to District.) These deeds will be hereinafter discussed.

DID TENNIS CLUB GET TITLE?

It is claimed that Tennis Club never became a corporation, either De jure or De facto, and hence had no power to accept title to real property or to convey it, and that when certain deeds were made it had been suspended for nonpayment of taxes and hence could not then execute a deed. Therefore, it is necessary to consider the history of Tennis Club and its actions.

On August 1, 1941, articles of incorporation of Tennis Club were filed with the Secretary of State. They provided for two classes of members: (1) three general members who were required to be residents of Bohemian Village subdivision and entitled to one vote each in the affairs of the corporation, and (2) 'participating members'--all bona fide residents of the subdivision but not entitled to vote. The articles named as directors and general members Jere Strizek, Jessie Dow Strizek and Richard Seely. (Richard Seely died on March 18, 1950.) It is claimed that no bylaws or amendments to the articles were ever adopted, although Oliver Foust testified that there were bylaws and minutes which were destroyed. The purpose of the corporation, according to the articles, was to establish a nonprofit social and recreational association to provide social and recreational activities for the residents, owners and tenants of the property in the subdivision known as Bohemian Village.

As stated, on September 18, 1945, two deeds from the Coffings of the property were executed to Tennis Club. The first question to be determined is whether Tennis Club acquired title by the deeds of the Coffings because at that time no action other than the filing of its articles of incorporation had been taken by it. ¹

Civil Code, section 597 (now Corp. Code, §§ 308 and 9501), dealing with the formation of Nonprofit corporations, as it existed in 1941 when Tennis Club's articles of incorporation were filed provided in pertinent part: 'Upon the filing of the articles by the secretary of state the corporation shall be created and shall continue to exist perpetually, unless otherwise provided by law, and shall possess the following powers: * * * to * * * acquire and hold all property, real or personal * * *.'

Section 292 of the Civil Code, then existing (now Corp. Code, § 308) dealing with the formation of general corporations, provided in part: 'The corporate existence shall begin upon the filing of the articles and shall continue perpetually, unless otherwise expressly provided by law.'

Section 370, as it then existed (now Corp. Code, § 313) provided: 'In any action at law, other than one in the nature of quo warranto, the original articles or certificate of incorporation, or a copy of either thereof, duly certified by the Secretary of State shall be conclusive evidence of its formation and prima facie evidence of its corporate existence.'

Sections 292 and 370 were applicable to nonprofit corporations by reason of the then section 605d (now Corp. Code, § 9002) which provided that the provisions of the general corporations law applied to non-profit corporations except as to matters specifically otherwise provided for.

'(I)n litigation between private parties the court may not inquire into the legal existence of a corporation which is acting under a charter which the Secretary of State has accepted for filing under the provisions of the General Corporation Law.' (Barber v. Irving (1964) 226 Cal.App.2d 560, 565, 38 Cal.Rptr. 142, 147; see 3 Witkin, Summary of Cal. Law (7th ed.) § 11, p. 2311; Ballantine & Sterling (4th ed.) §§ 41, 42, pp. 86--88.) Although Barber dealt with the later sections of the Corporations Code, it is still applicable as the Corporations Code sections are, as hereinbefore stated, the codification...