Daniel Webster Council, Inc., Boy Scouts of America v. St. James Ass'n, Inc.

• Decision Date: 19 August 1987
• Docket Number: No. 86-391,86-391
• Citation: 533 A.2d 329,129 N.H. 681
• Parties: DANIEL WEBSTER COUNCIL, INC., BOY SCOUTS OF AMERICA v. ST. JAMES ASSOCIATION, INC., a/k/a Camp Leo.
• Court: New Hampshire Supreme Court

Page 329

533 A.2d 329

129 N.H. 681

DANIEL WEBSTER COUNCIL, INC., BOY SCOUTS OF AMERICA v. ST. JAMES ASSOCIATION, INC., a/k/a Camp Leo.

No. 86-391.

Supreme Court of New Hampshire.

Aug. 19, 1987.

Bell, Falk & Norton P.A., Keene (Ernest L. Bell, III, on the brief and orally), for plaintiff.

Winer, Pillsbury & Bennett, Nashua (Robert W. Pillsbury on the brief and orally), for defendant.

THAYER, Justice.

This case involves a bill in equity for specific performance filed by the plaintiff, Daniel Webster Council, Inc., Boy Scouts of America. The Superior Court (M. Flynn, J.) granted the plaintiff's request for specific performance and ordered St. James Association, Inc., the defendant, to transfer the real property described in a sales agreement to the plaintiff. We reverse the superior court's order.

The parties hereto are charitable corporations which entered into a land contract on February 8, 1979, pertaining to a parcel of the defendant's land, known as Camp Leo, situated on the shores of Manning Lake in Gilmanton. The agreement stated that the defendant would grant the plaintiff the right of "first refusal to either lease or purchase the Premises." The land contract was signed by Hazel Lachmund, the secretary of the defendant corporation.

On December 18, 1984, Leonard Francis, the treasurer of the defendant corporation, entered into a purchase and sale agreement on behalf of the defendant to convey the premises to a third party. The plaintiff, upon learning of the purchase and sale agreement, exercised its claimed right of first refusal by matching the offer made by the third party. The defendant refused the plaintiff's offer and entered into a second purchase and sale agreement with the third party. The plaintiff subsequently brought suit for specific performance of the land contract, which was granted by an order of the superior court from which the defendant appeals.

The defendant contends on appeal that both the land contract and the purchase and sale agreement with the third party are not enforceable against the defendant because they were entered into by the secretary and treasurer of the corporation, respectively, who did not have actual or apparent authority to execute the agreements. Furthermore, the defendant contends that the land contract should fail for lack of consideration.

The plaintiff asserts that the agreements are enforceable solely on the grounds that Lachmund and Francis each had either actual or apparent authority to act on behalf of the defendant to convey the property known as Camp Leo. We will therefore confine our answer to those two legal concepts. We disagree with plaintiff's contentions. With regard to the actual authority of officers of a corporation, they have only those powers conferred on them by the bylaws of the corporation or by the resolution of the directors. See RSA 294:89 (currently codified at RSA 293-A:50, II (Supp.1986)). The bylaws of the defendant corporation state that Lachmund, as secretary, is vested with the authority to act as the chairman at the meetings of the executive committee, in the absence of the chairman, and to "perform other duties as may be prescribed by vote of the Executive Committee and ... to keep careful minutes of meetings and to report to the Board of Trustees." The bylaws clearly do not confer upon the secretary the original authority to enter into contracts on behalf of the corporation. Furthermore, the trial court found that the...