Ne. Comanche Tribe, Inc. v. Stumpf
| Decision Date | 07 October 2022 |
| Docket Number | 123,642 |
| Parties | Northeast Comanche Tribe, Inc., and Avraham Shiloh, Appellees, v. Christina J. Stumpf, Ronald Ward, Malcom Dickinson, and Peter C. Morse, Appellants. |
| Court | Kansas Court of Appeals |
NOT DESIGNATED FOR PUBLICATION
Appeal from Sedgwick District Court; KEVIN M. SMITH, judge.
Marc S. Wilson, of Securitas Financial Law, LLC, of Overland Park Scott E. Sanders and Corey M. Adams, of McDonald Tinker PA of Wichita, John E. Franke and Matthew M. Clifford, of Franke Shultz &Mullen, P.C., of Kansas City, Missouri, and Craig C. Blumreich and Richard P. Billings, of Larson &Blumreich, Chtd., of Topeka, for appellants.
Jeff C. Spahn, Marcia A. Wood, and Matthew A. Spahn, of Martin Pringle, Oliver, Wallace &Bauer, L.L.P., of Wichita, for appellees.
Before GREEN, P.J., ATCHESON and HURST, JJ.
The leaders of two factions in a not-for-profit corporation that basically functions as a social club for owners of Piper Comanche airplanes claim to be the duly elected officers of the organization-conflicting assertions that cannot both be correct. Apparently unable to resolve their rivalry through some amicable agreement, they brought the dispute to the Sedgwick County District Court. Plaintiff Avraham Shiloh filed a civil action on his own behalf and ostensibly for the organization seeking a declaration that he has been fairly elected president, along with a slate filling the other officers' positions. Defendant Christina J. Stumpf holds herself out as the properly elected president of the corporation, and the three other defendants have laid claim to being corporate officers as part of her slate.
In their aggressive counter to Shiloh's suit, the defendants filed a motion to dismiss under the Kansas Public Speech Protection Act, K.S.A. 2021 Supp. 60-5320, claiming the action impermissibly intruded on their statutorily protected rights. The district court denied the motion. The Act provides that a defendant losing a motion to dismiss may file an interlocutory appeal of the district court's ruling. K.S.A. 2021 Supp. 60-5320(f)(2). Stumpf and her codefendants have done so, and that is what we have in front of us.
We conclude the district court reached the right result in denying the motion and, therefore, affirm the ruling. The litigation may now continue in the district court. See K.S.A 2021 Supp. 60-5320(f) (). Plaintiffs have filed a motion to recover their attorney fees for this appeal from the defendants. We deny that motion.
In deciding this appeal, we come at the issue from a different angle than the district court, as we now explain. Granting a motion to dismiss under the Act entails a two-step process. First, a defendant must show the plaintiff's legal action "is based on, relates to[,] or is in response to [the defendant's] exercise of the right of free speech, right to petition[,] or right of association" as defined in K.S.A. 2021 Supp. 60-5320(c)(3), (4), and (5). K.S.A. 2021 Supp. 60-5320(d). Second, if the defendant does so, the plaintiff may defeat the motion by presenting "substantial competent evidence" establishing a "prima facie" basis for the legal action or the particular claim or claims the defendant has challenged. K.S.A. 2021 Supp. 60-5320(d). Here, the district court denied the motion because the defendants failed in the initial statutory showing; it, therefore, never considered the second step. We have chosen to skip over the first step and, instead, to consider the second step. The record compiled in the district court on the motion shows Shiloh has presented a prima facie case for a declaratory judgment resolving the immediate conflict between the rival groups claiming to be the duly elected corporate officers. That is sufficient to deny the defendants' motion to dismiss under the Act.
In the district court, the plaintiffs and the defendants briefed and argued both of the steps outlined in K.S.A. 2021 Supp. 60-5320(d). They have similarly addressed both in their appellate briefs. So the point has been fully ventilated in each court. The resolution of the second step, by its very nature, does not require the resolution of witness credibility or of conflicts in the evidence, since it depends on substantial evidence supporting a prima facie case. As such, the second step presents a question of law we may consider in the first instance. In re Estate of Oroke, 310 Kan. 305, 310, 445 P.3d 742 (2019). During oral argument, the lawyers agreed that we have the latitude to address either or both procedural steps in the process for ruling on a motion to dismiss under the Act.
In considering whether a party has presented a prima facie case, we look at whether the evidence, if unrebutted, would be sufficient to support a verdict or judgment for that party. See Montgomery v. Saleh, 311 Kan. 649, 653, 466 P.3d 902 (2020); State v. Haremza, 213 Kan. 201, 206, 515 P.2d 1217 (1973). Similarly, substantial evidence has such relevance and scope that a person would accept it as supporting a factual proposition-a measure that does not factor in conflicting evidence. See Cresto v. Cresto, 302 Kan. 820, 835, 358 P.3d 831 (2015); State v. Medrano, 271 Kan. 504, Syl. ¶ 1, 23 P.3d 836 (2001). Because the second step entails applying undisputed facts making up the prima facie case to set legal standards, we can perform that function just as well as the district court can, so there is no overriding need to remand for a new legal determination on the point. See State v. Wilson, 308 Kan. 516, 527, 421 P.3d 742 (2018); State v. Randall, 257 Kan. 482, 486, 894 P.2d 196 (1995); State v. Parry, 51 Kan.App.2d 928, 930, 358 P.3d 101 (2015), aff'd 305 Kan. 1189, 390 P.3d 879 (2017).
With that we turn to the pertinent facts. The Northeast Comanche Tribe, Inc. is a Kansas not-for-profit corporation and is ostensibly a plaintiff in this action, along with Shiloh. Owners of Piper Comanche airplanes who live in the Mid-Atlantic and Northeast states may become members of the organization. As an explanatory aside, we mention that the Comanche moniker covers various models of popular single- and twin-engine airplanes that Piper Aircraft, Inc. manufactured from the late 1950s to the early 1970s. We presume the aircraft name accounts for the regional not-for-profit corporation using Native American references such as calling the organization a "tribe" and its president a "chief." Why the corporation was formed and registered in Kansas is less apparent.
The Northeast Comanche Tribe sponsors regular "fly-ins"-largely social gatherings to which the attending members typically pilot their airplanes. The corporation also circulates a periodic newsletter and hosts educational programs on airplane safety and other matters. The Northeast Comanche Tribe is affiliated with the International Comanche Society, Inc., another Kansas not-for-profit corporation, that serves as an umbrella organization for various regional Comanche owners' clubs. The presidents of the regional organizations (or their duly chosen substitutes) sit on the governing board of the International Comanche Society. Members join both the International Comanche Society and the geographically appropriate regional organization and pay dues that are split between the two corporations. So the officers of the Northeast Comanche Tribe have control of and access to some of the dues.
The dues-paying members of the regional organizations elect their respective corporate officers. Shiloh served consecutive terms as president of the Northeast Comanche Tribe and understood he could not run again. Stumpf then ran and was elected president in 2014. Some evidence in the record indicates annual elections were not held after that, and Stumpf and her slate simply continued in office. Stumpf has disputed the assertion. Shiloh lodged a complaint with the International Comanche Society. In response, the International Comanche Society organized and oversaw an election of officers for the Northeast Comanche Tribe in 2019 that Shiloh and his slate won. Meanwhile, Stumpf and her slate, who described themselves as the incumbent officers, conducted a separate election that their group won.
As a result, the Northeast Comanche Tribe has two slates each claiming to be the duly elected officers of the corporation. The International Comanche Society has recognized Shiloh as the president of the Northeast Comanche Tribe and identifies him as such in filings with the Kansas Secretary of State. Both Shiloh and Stumpf have submitted filings to the Kansas Secretary of State ostensibly as the corporate president of the Northeast Comanche Tribe. The conflicting claims of Shiloh and Stumpf have caused confusion and consternation within and without the Northeast Comanche Tribe.
The record evidence establishes an immediate and real controversy-rather than an abstract or merely hypothetical dispute-supporting a declaratory judgment action. K.S.A 60-1701 (); see In re Estate of Keller, 273 Kan. 981, 984, 46 P.3d 1135 (2002) ("Declaratory relief is not to be entertained for the purpose of settling abstract questions[.]"); Santa Rosa KM Assocs. v. Principal Life Ins. Co., 41 Kan.App.2d 840, 858, 206 P.3d 40 (2009) (...
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