Simoni v. Civil Service Employees Ass'n, Inc., Local 1000, AFSCME, AFL-CIO, AFL-CI

• Decision Date: 20 October 1986
• Docket Number: D,AFL-CI
• Citation: 133 Misc.2d 1,507 N.Y.S.2d 371
• Parties: Robert SIMONI et al., Plaintiffs, v. The CIVIL SERVICE EMPLOYEES ASSOCIATION, INC., LOCAL 1000, AFSCME,efendant.
• Court: New York Supreme Court

Page 371

507 N.Y.S.2d 371

133 Misc.2d 1

Robert SIMONI et al., Plaintiffs, v. The CIVIL SERVICE EMPLOYEES ASSOCIATION, INC., LOCAL 1000 AFSCME, AFL-CIO, Defendant.

Supreme Court, Albany County.

Oct. 20, 1986.

Shanley, Sweeney & Reilly, Albany, for plaintiffs; (Michael P. Shanley, of counsel).

DeGraff, Foy, Conway, Holt-Harris & Mealey, Albany, for defendant; (John T. DeGraff, Jr., and Michael T. Wallender, of counsel).

Roemer & Featherstonhaugh, P.C., Albany, for amicus curiae; (James W. Roemer, Jr., of counsel).

MEMORANDUM DECISION

HAROLD J. HUGHES, Justice Presiding.

Plaintiffs move for a preliminary injunction, and request partial summary judgment, in this declaratory judgment action.

This case involves a power struggle for control of the State's largest public employee union (CSEA), pitting the union president (McGowan) and delegates against the vice-president (McDermott) and the board of directors. At stake is command of a union that wields influence at the highest levels of State and local governments through political endorsements and contributions and the size and nature of its membership. The court enters the fray reluctantly, well aware that in the ordinary case the judiciary will not interfere with the internal affairs of a not-for-profit corporation, including a labor union, absent a showing of fraud or substantial wrongdoing (Matter of Gilheany v. Civil Serv. Employees Assn., 59 A.D.2d 834, 395 N.Y.S.2d 717). However, this is not the ordinary case in that this controversy could paralyze the operation of a 200,000 member public employee union, to the detriment of the general public. Consequently, declaratory relief is appropriate.

CSEA is a 75-year old labor union organized as a not-for-profit corporation. From its incorporation in 1941 until March of 1976, CSEA's counsel was the DeGraff firm. The enactment of the Public Employees Fair Employment Act (L.1967, ch. 392), commonly called the Taylor Law, greatly expanded the duties and powers of all public employee unions through the enactment of agency shops, exclusive representation, and the granting of the statutory right to public employees to collective bargaining over the terms and conditions of employment. CSEA grew in size and influence. During 1976 it broke its long relationship with the DeGraff firm and retained the Roemer firm as its counsel. ¹ In the present action each firm claims to be the attorneys of record for CSEA.

This controversy stems from resolutions adopted by the board of directors of CSEA on February 27, 1986 and May 6, 1986. CSEA's board of directors consists of 115 members elected by the general membership. Section 2 of article IV of CSEA's constitution provides that the "power and authority to transact all business of the Association shall, subject to the power and authority of the Delegates at meetings of the Association, be vested in a Board of Directors". Section 1 of article I of the by-laws states that the "President shall be responsible for the organization and direction of the staff of the Association".

Prior to the adoption of the February 27, 1986 resolution, the board of directors concluded that there existed many problems in the internal organization of CSEA's staff, and through the implementation of the two resolutions, attempted to redress the perceived deficiences (paragraphs 24 through 30 of the affidavit of C. Allen Mead, sworn to September 4, 1986). The board's reorganization plan created 13 new positions and provided that the persons holding these positions report directly to Vice-President McDermott, rather than to President McGowan. The May 6, 1986 resolution further implemented the reorganization plan by directing all professional and management staff responsible for field operations to report in accordance with the new chain of command, and providing that all appointments and dismissals of management confidential staff above grade 14 not be effective without the prior approval of the personnel committee of the board of directors.

President McGowan was of the opinion that the board of directors was attempting to usurp his authority to organize and direct the staff, and commenced an action to set aside the board's resolutions. Simultaneously, during August of 1986, a number of presidents of CSEA locals petitioned President McGowan to call a special meeting of the delegates with an agenda to review: (1) "the power and authority of the elected President of CSEA to carry out his constitutional duties including his responsibility to organize and direct the staff of the Association; and (2) the delivery of legal services to CSEA" (Exhibit B to the order to show cause dated September 25, 1986).

Subdivision (d) of section 603 of the Not-for-Profit Corporation Law states that a corporati may provide that its members elect representatives or delegates who when assembled exercise all of the powers, rights and privileges of members of the corporation. Since more than 200,000 people belong to CSEA, it would be impractical to have members' meetings. Therefore, the union's constitution provides that each local elect delegates. In effect, the delegate are the representatives of the union rank and file.

Three actions were taken at the September 9, 1986 special delegates meeting. The first action was the passage of a resolution reaffirming the by-law directing the president to be responsible for the organization and direction of the staff and providing "the Board of Directors of the Association has no power to interfere with the chain of command between the President and the staff of the Association or to interfere with the directives of the President to the staff". The resolution went on to rescind the February 27 and May 6 resolutions of the board. The second action was to pass a resolution directing President McGowan to appoint a committee of members to review the delivery of legal services to CSEA and to report its findings and recommendations to the delegate body at the annual meeting commencing October 25, 1986. Finally, the delegates, acting upon an item not listed on the agenda of the special meeting, adopted a resolution naming John Francisco as treasurer to replace the retiring treasurer.

President McGowan determined that the actions taken at the special meeting removed the basis for his lawsuit to undo the board's resolutions and his motion to discontinue his action was granted. Vice-President McDermott then commenced an action against CSEA and Francisco challenging Francisco's appointment upon the ground that it was not listed on the agenda to be discussed at the special meeting of delegates, and upon the further ground that the union's by-laws provide that "Vacancies in the office of Secretary and Treasurer may be filled for the remainder of the term by the Board of Directors". This court has granted a preliminary injunction in the McDermott action restraining Francisco from taking office upon the reasoning that McDermott will be likely to succeed on the merits due to the lack of notice to the delegates that filling the vacancy in the treasurer's position would be addressed at the special meeting, and upon the ground that no emergency existed permitting the delegates present at the meeting to add the issue to the agenda. Thereafter, the plaintiffs in this action, presidents of four CSEA locals plus delegate Robert Simoni, commenced this action to declare all resolutions passed at the September 9, 1986 special meeting void upon the grounds that: (1) delegates were not given proper notice of the meeting; (2) the credentials committee improperly determined voting strength based upon paid membership in the association as of June 1, 1985 rather than June 6, 1985, the date required by the union's constitution; and (3) CSEA's constitution and the Not-for-Profit Corporation Law direct that a not-for-profit corporation is to be managed by its board of directors and the resolutions adopted by the delegates improperly attempt to limit the authority of the CSEA board of directors to manage the union.

Plaintiffs in this action made the present motion for a preliminary injunction restraining CSEA from implementing the resolutions of the delegates adopted at the September 9, 1986 special meeting. President McGowan retained the DeGraff firm to represent CSEA in both the McDermott and the Simoni actions. The board of directors instructed the Roemer firm to appear for CSEA in both actions. Thus, before the merits can be reached, a determi nation must be made as to which law firm will represent CSEA in this lawsuit. ²

The representation question is determined by the practical consideration that a declaratory judgment action can be maintained only when there is an actual controversy between the parties to the litigation (DeMilia v. State of New York, 72 A.D.2d 536, 421 N.Y.S.2d 70, cert. den. 447 U.S. 922, 100 S.Ct. 3014, 65 L.Ed.2d 1114). This court is constitutionally prohibited from rendering an advisory opinion in a friendly lawsuit (New York Public Interest Research Group v. Carey, 42 N.Y.2d 527). Here, after being directed to appear by the board, the Roemer firm made a motion for summary judgment "declaring that, pursuant to the Not-For-Profit Corporation Law of New York, the Certificate of Incorporation of CSEA, Inc. and the constitution and by-laws of CSEA, Inc., the CSEA board of directors is vested with plenary authority to manage the affairs and organization of CSEA, Inc., and, accordingly, the action taken by CSEA delegates with respect to Resolution No. 1, at a Special Meeting on September 9, 1986 is null and void" (order to show cause of HUGHES, J., dated September 19, 1986). In bringing the motion, Mr. Roemer candidly states that his law firm is "in the unusual position of substantially agreeing with the allegations and legal conclusions submitted by the plaintiffs herein" (paragraph 3 of the affidavit of James W. Roemer, Jr., sworn to September 29, 1986). Plaintiffs' attorneys...