Leeds v. Harrison

• Decision Date: 23 March 1950
• Docket Number: No. C--443,C--443
• Parties: LEEDS et al. v. HARRISON et al.
• Court: New Jersey Superior Court

Page 558

7 N.J.Super. 558

72 A.2d 371

LEEDS et al. v. HARRISON et al.

No. C--443.

Superior Court of New Jersey Chancery Division.

March 23, 1950.

Moore, Butler & McGee, Atlantic City by James N. Butler, Atlantic City, for plaintiffs.

Weidner Titzck, Camden, and Stephen L. Valore, Atlantic City, for defendants.

HANEMAN, J.S.C.

This is a motion addressed to the complaint in the above entitled matter. The complaint alleges that seven of the plaintiffs are members of the defendant Young Women's Christian Association of Atlantic City, New Jersey; that Ezra C. Bell and Augusta I. Evans had at various times contributed services and money to the defendant Young Women's Christian Association of Atlantic City, New Jersey; that the other twelve named plaintiffs, being duly qualified for admission to the defendant Young Women's Christian Association of Atlantic City, New Jersey, and having duly applied for membership, were refused admission as active members.

For the purpose of convenience, the first named plaintiffs will be referred to as 'members;' the second named plaintiffs will be referred to as 'contributors;' the third named plaintiffs will be referred to as 'non-members' and the defendant Young Women's Christian Association of Atlantic City, New Jersey will be referred to as 'Y.W.C.A.'

The allegations of the complaint, which consists of seven counts, and the grounds for this motion, will be paraphrased in brief.

The allegata of the complaint set forth that (1) the provisions of the constitution and by-laws heretofore adopted by the individually named defendants, or some of them, are illegal, in that (a) they provide for a board of directors, consisting of fifteen or more members; (b) that there have been elected and appointed in addition to said board of directors a number of trustees; (c) that the individually named defendants have adopted objects and purposes contrary to the purposes set forth in the certificate of incorporation; (2) the individually named defendants have conducted the affairs of the defendant corporation in contravention of the certificate of incorporation, the constitution and by-laws of the Y.W.C.A., and the statutes of the State of New Jersey; (3) that the individual defendants have failed to carry out the terms and provisions of the certificate of incorporation, the constitution and by-laws of the Y.W.C.A., in that, as a qualification for membership applicants are required (a) to subscribe to a 'statement of faith;' (b) be members of certain specified Protestant Evangelical churches; (c) to appear in person before the membership committee on certain days and between certain hours; (d) the individual defendants have arbitrarily discriminated between duly qualified applicants; (4) the individual defendants have failed to comply with said by-laws, which require them to 'seek to increase and hold membership;' (5) the contributors contributed services and donated funds with the understanding and agreement that the Y.W.C.A. would be conducted in accordance with the provisions of the certificate of incorporation and the statute under which said corporation was incorporated, but that the individual defendants have failed and neglected to carry on said corporation as aforesaid; (6) the individual defendants have neglected and refused to furnish a financial statement of the Y.W.C.A.; (7) the individual defendants are operating upon the premises owned by the defendant corporation a commercial restaurant and hotel for profit, in violation of the law applicable to and the purposes of the Y.W.C.A.; (8) the individual defendant officers and directors have for many years held annual elections which have been conducted contrary to the laws of the State of New Jersey and the by-laws of the corporation.

In light of the foregoing, plaintiffs demand the following relief: (1) that the individually named defendants be required to conduct the affairs and property of the defendant Y.W.C.A. in accordance with the provisions of the certificate of incorporation and the statute under which it was incorporated; (2) that the defendants be restrained from enforcing or hereafter promulgating rules, regulations and requirements in respect to membership which are contrary to the certificate of incorporation of the defendant corporation and the act under which the Y.W.C.A. is incorporated, and the laws of New Jersey; (3) that the defendants be restrained from requiring present members or applicants to be members of Protestant Evangelical churches; (4) that the defendants be restrained from requiring applicants for membership to subscribe to the 'statement of faith' above referred to; (5) that the defendants be restrained from using or requiring membership in defendants' private list of Protestant Evangelical churches; (6) that the defendants be ordered to admit to membership plaintiffs who have applied for membership and all other duly qualified persons; (7) that the defendants be required to hold an election for directors and officers in accordance with the law and under the supervision of this court; (8) that the defendant officers and directors be ordered to account for their operation of the defendant corporation.

The defendants now move to dismiss all counts for failure to state a claim, and in the alternative, if such motion should be denied as to some of the specific counts, then for a summary judgment on said counts for reasons hereafter stated.

The bases for the motion addressed to the complaint in toto are as follows, that (1) the twelve non-members of the defendant Y.W.C.A. have no interest upon which they can predicate an action, and (2) the seven members of the defendant Y.W.C.A. have not exhausted their remedies as members of the defendant corporation within the corporation itself, and that there is no property right here involved. The bases for the motion addressed to the separate counts are as follows, (1) the first count should be dismissed because it does not allege any breach of law and because it appears to be predicated on implications of fraud and breach of trust, without any allegations of any facts which might constitute such wrongs; (2) the second and third counts of the complaint should be dismissed on the ground that the defendant corporation possesses the sole right to admit or refuse to admit to membership individuals applying therefor; (3) the fourth count of the complaint should be dismissed upon the ground that if it is concerned with the administration of a charitable trust, such action should be brought by the Attorney General of the State of New Jersey and not by those who allege that they have contributed to the fund constituting such charitable trust, and if a charitable trust is not involved, the complaint fails to state a claim upon which relief can be granted; (4) that the sixth, seventh and eighth counts should be dismissed because they fail to state a cause of action upon which relief can be granted; (5) that the third, fifth and sixth counts should be dismissed because they show palpably that there is no genuine issue as to any material fact challenged, as provided in Rule 3:56--3.

The pertinent facts as disclosed by the complaint and affidavits are as follows: The defendant Y.W.C.A. was incorporated in 1915 under an act entitled 'An Act to incorporate associations not for pecuniary profit.' P.L.1898, p. 422, now known as R.S. 15:1--1 et seq., N.J.S.A. The certificate of incorporation itself is very brief, but provides, in part, as follows:

'(2) The purpose for which said corporation is formed is the improvement of the spiritual, intellectual, social and physical condition of young women.'

'(4) The number of trustees shall be five.'

In addition, at some time not made clear by the complaint nor the affidavits, a 'constitution' and by-laws were adopted for 'Young Women's Christian Association of Atlantic City, N.J.' The constitution contained the following provisions:

'The purpose of the Young Women's Christian Association shall be to associate young women in personal loyalty to Jesus Christ as Savior and Lord; to promote growth in Christian character and service through physical, social, mental and spiritual training and to become a social force for the extension of the Kingdom of God.'

'Section 2. Object. The Object of this Association shall be the spiritual, intellectual, social and physical development of Young Women.'

'Section 1. (a) General Members. Any woman properly introduced or giving satisfactory reference as to character, may become a member of the Association.

'(b) In order to conserve the purpose of the Association members shall be classified at the time that payment is made of the Annual membership fee as (1) Active Members, comprising those who subscribe to and will support the purpose and who are members of Protestant Evangelical Churches; these members shall be voting members known as electors.'

'Section 1. Duties. The management of this Association shall be vested in a Board of not less than fifteen nor more than twenty-one Directors chosen by ballot from the active members, which shall organize departments and branches, and shall have supervision of all work of the Association, and shall make all contracts and leases.'

'Section 2. Elections. One third of the Board of Directors shall be elected by ballot, cast by the active members of the Association, at each annual meeting to serve for a period of three years. The Board shall have the power to fill any vacancy occurring in the interim of annual meetings. Not more than one-third of the Board of Directors shall be members of any one Church denomination.'

'There shall be a Board of not less than five Trustees, either men or women, whose terms of office shall be three years. The President shall be ex-officio a member of this Board.'

'The membership committee shall have charge of all matters pertaining to membership and it shall seek to increase and hold the membership and develop it...