Fry v. Pekarovich

• Decision Date: 18 March 1975
• Court: California Court of Appeals Court of Appeals
• Parties: , 76 Lab.Cas. P 53,677 Carl D. FRY, Petitioner and Respondent, v. Frank PEKAROVICH, Recording Secretary of the All City Employees Association, All City Employee Association, a non-profit corporation, Respondents and Appellants. Civ. 44260.

Page 55

120 Cal.Rptr. 55

46 Cal.App.3d 165, 76 Lab.Cas. P 53,677

Carl D. FRY, Petitioner and Respondent, v. Frank PEKAROVICH, Recording Secretary of the All City Employees Association, All City Employee Association, a non-profit corporation, Respondents and Appellants.

Civ. 44260.

Court of Appeal, Second District, Division 1, California.

March 18, 1975.

Warren, Adell & Miller, Charles Warren and Hirsch Adell, Los Angeles, for appellants.

Arthur Levitas, Los Angeles, for respondent.

McCOURTNEY, ^* Associate Justice.

This appeal is taken from a judgment granting a writ of mandate ordering appellant McCarns, as secretary of All City Employees Association, to include, among the signatures on a petition to be verified by her, those of General members as well as Represented members of the appellant All City Employees Association (hereinafter referred to as ACEA).

The ACEA is a non-profit corporation which offers membership to employees of the City of Los Angeles. A joint council of that body with the American Federation of State, County and Municipal Employees, AFL-CIO (AFSCME) was formed in October, 1971, for the purpose of representing employees of the City in accordance with the appropriate ordinance. Thereafter the joint council proceeded to file petitions seeking certification as the recognized employee organization and bargained for the members of the ACEA in classifications of employees that had selected the joint council to represent them. At the time this writ was argued in the trial court there were 2104 members represented by AFSCME, (denominated by the by-laws as Represented members) and 9223 members not represented (General members).

Respondent herein, a General member, filed with appellant McCarns a petition requesting the Board of Directors of ACEA to rescind its agreement with AFSCME forming the joint council and should the Board fail to so act, to submit the question of rescission to vote of the members. Appellant McCarns as recording secretary was charged with the duty of verifying the signatures and determining whether there was a sufficient number. McCarns examined the petition and notified respondent that the number of signatures was insufficient in that the only valid signatures were those of Represented members. Two weeks later the Board of Directors of ACEA by formal action in regular meeting adopted the letter sent by McCarns to respondent; and thereafter respondent filed the subject action seeking a writ of mandate to verify signatures of general members as well as represented members. That writ was granted and this appeal followed.

Appellant maintains (1) that there is ambiguity in the provisions of the by-laws, therefore the interpretation of the Board of Directors should be binding upon the courts, minus a finding of unreasonableness or arbitrariness, (2) assuming the court should make an independent interpretation, the court erred in its ruling, (3) the appellant McCarns' duties were discretionary rather than ministerial in nature and thus a writ of mandate was improperly issued, and (4) the writ improperly terminated a joint venture prior to the completion of its purpose.

Appellant argues that the Board of Directors of ACEA by its action in adopting McCarns' letter to respondent properly exercised its power to interpret the by-laws and the court is restricted in its power to make an independent determination and overrule that body. Appellants point to 18 C.J.S. Corporations § 183, page 595, wherein, in relation to the interpretation of by-laws of an unincorporated association, it is stated:

'The board of directors of a corporation may interpret an ambiguous by-law without formality, the interpretation arising from their conduct and methods of transacting business, and the general rule as to recognizing a practical construction by the parties applies, so that, in the case of ambiguity in a by-law, a court will not give it a positive construction opposed to any consistent practical construction which it has received from the corporation and its members, where such practical construction is not unreasonable, or contrary to the principles of justice or morality or to any rule of law or public policy. The courts, however, are not bound by the construction adopted by the corporation, its officers, or its members.'

that concept has been adopted in California courts (DeMille v. American Fed. of Radio Artists (1947) 31 Cal.2d 139, 187 P.2d 769; Williams v. Inglewood Board of Realtors (1963) 219 Cal.App.2d 479, 33 Cal.Rptr. 289). It is therefore argued by appellant that there was an ambiguity, the Board made a reasonable interpretation, and it was not within the trial court's province to reverse the Board's ruling.

Neither the finding of lack of ambiguity by the trial court not its interpretation of the by-laws has any binding effect on this appellate court. In the absence of extrinsic evidence the interpretation of writing is a matter of law and must be independently determined upon appeal. (Estate of Platt (1942) 21 Cal.2d 343, 131 P.2d 825; Estate of Shannon (1965) 231 Cal.App.2d 886, 42 Cal.Rptr. 278; Parsons v. Bristol Development Co. (1965) 62 Cal.2d 861, 44 Cal.Rptr. 767, 402 P.2d 839.)

In any case we do not find that this court is required to find ambiguity or unreasonableness in the determination of the Board of Directors to rule unconstrained by that interpretation. An analysis of the philosophy advanced in 18 C.J.S., Supra, and the holding of the cases cited herein, adopting that philosophy, indicate that the concept developed because the court considered the ruling body of those unincorporated associations better suited to construe the meaning of by-laws in cases where the practice and customs of the association was at issue. Parsons v. Bristol Development Co., Supra, extensively discusses the rule, the history, and the reasoning therefore. The author in an article entitled Developments in the Law, Judicial Control of Actions of Private Associations, appearing in 76 Harvard Law Review 983, noted at page 991:

'. . . 'If a court undertakes to examine the group's rules or past usages, its inquiry may lead it into what Professor Chafee has called the 'dismal swamp,' the area of its activity concerning which only the group can speak with competence. Rules and usages which have taken on a peculiar meaning over a period of time, when interpreted by a court which is unfamiliar with the group or unsympathetic to its practices, may be construed in a way which does not reflect the understanding of the members prior to the dispute."

However, we fail to find any case wherein the doctrine has been held applicable where the question at issue is the meaning of by-laws that may be determined without reference to custom or usage. Similar to the independence of the appellate court upon review of writings where no extrinsic evidence is pertinent or offered the matter becomes a question of law and it is the duty of the court to reach an independent...