White v. Cox

• Decision Date: 24 May 1971
• Citation: 17 Cal.App.3d 824,95 Cal.Rptr. 259
• Court: California Court of Appeals Court of Appeals
• Parties: , 45 A.L.R.3d 1161 Ronald F. WHITE, Plaintiff and Appellant, v. Donald W. COX, M.D., erroneously sued and served as Merrywood Apartments, a California corporation, Defendant and Respondent. Civ. 37103.

Page 259

95 Cal.Rptr. 259

17 Cal.App.3d 824, 45 A.L.R.3d 1161

Ronald F. WHITE, Plaintiff and Appellant, v. Donald W. COX, M.D., erroneously sued and served as Merrywood Apartments, a California corporation, Defendant and Respondent.

Civ. 37103.

Court of Appeal, Second District, Division 2, California.

May 24, 1971.

Rehearing Denied June 21, 1971.

Hearing Denied July 21, 1971.

Hafif & Shernoff by Stephen L. Odgers Claremont, for plaintiff-appellant.

Staitman & Snyder by Jack M. Staitman, Beverly Hills, for defendant-respondent.

FLEMING, Associate Justice.

Plaintiff White owns a condominium in the Merrywood condominium project and is a member of Merrywood Apartments, a non-profit unincorporated association which maintains the common areas of Merrywood. In his complaint against Merrywood Apartments for damages for personal injuries White avers he tripped and fell over a water sprinkler negligently maintained by Merrywood Apartments in the common area of Merrywood. The trial court sustained Merrywood's demurrer without leave to amend and entered judgment of dismissal. ¹ White appeals.

The question here is whether a member of an unincorporated association of condominium owners may bring an action against the association for damages caused by negligent maintenance of the common areas in the condominium project. In contesting the propriety of such an action defendant association argues that because it is a joint enterprise each member is both principal and agent for every other member and consequently the negligence of each member must be imputed to every other member. Hence, its argument goes, a member may not maintain an action for negligence against the association because the member himself shares responsibility as a principal for the negligence of which he complains. (6 Am.Jur.2d, Associations and Clubs, § 31.)

We first consider the present status of an unincorporated association's liability in tort to its members. In Marshall v. International Longshoremen's and Warehousemen's Union, 57 Cal.2d 781, 22 Cal.Rptr. 211, 371 P.2d 987 the court ruled that a member of a labor union organized as an unincorporated association could sue the union for negligent acts which the member had neither participated in nor authorized. The court said: 'Under traditional legal concepts the partnership is regarded as an aggregate of individuals with each partner acting as agent for all other partners in the transaction of partnership business, and the agents of the partnership acting as agents for all of the partners. When these concepts are transferred bodily to other forms of voluntary associations such as fraternal organizations, clubs and labor unions, which act normally through elected officers and in which the individual members have little or no authority in the day-to-day operations of the association's affairs, reality is apt to be sacrificed to theoretical formalism. The courts, in recognition of this fact, have from case to case gradually evolved new theories in approaching the problems of such associations, and there is now a respectable body of judicial decision, especially in the field of labor-union law, with which we are here directly concerned, which recognizes the existence of unincorporated labor unions as separate entities for a variety of purposes, and which recognizes as well that the individual members of such unions are not in any true sense principals of the officers of the union or of its agents and employees so as to be bound personally by their acts under the strict application of the doctrine of Respondeat superior.'

In effect, the court found that the traditional immunization of an unincorporated association from liability in tort to its members rested on two supports: (1) an unincorporated association lacks a legal existence separate from its members; (2) each member exercises control over the operations of the association. But the court observed that these supports no longer carried the persuasiveness they once did, and it quoted from its opinion in DeMille v. American Federation of Radio Artists, 31 Cal.2d 139, 149, 187 P.2d 769, 776: 'The member and the association are distinct. The union represents the common or group interests of its members, as distinguished from their personal or private interest. 'Structurally and functionally, a labor union is an institution which involves more than the private or personal interests of its members. It represents organized, institutional activity as contrasted with wholly individual activity. This difference is as well defined as that existing between individual members of the union.' United States v. White, 322 U.S. 694, at page 701, 64 S.Ct. 1248, 88 L.Ed.2d 1542, 152 A.L.R. 1202.' The court then concluded that a union could be held liable in tort for negligence to a member. But it specifically limited the application of its ruling to labor unions, declaring it would leave 'to future development the rules to be applied in the case of other types of unincorporated associations.' (57 Cal.2d at 787, fn. 1, 22 Cal.Rptr. at 215, 371 P.2d at 991.)

Since Marshall in 1962 the rule of non-liability of an unincorporated association to its members has suffered further erosion from both statutory and case law. Under amendments to the Corporations Code in 1967 an unincorporated association, defined as 'any partnership or other unincorporated organization of two or more persons' (§ 24000), has been made liable to third persons to the same extent as if the association were a natural person (§ 24001), ² its property (but not the property of its members) may be levied upon by writ of execution to enforce a judgment against the association (§ 24002), and a system has been created for the designation of agents for service of process (§§ 24003--24007). An unincorporated association may own property (§§ 21200--21201), protect its name and insignia (§§ 21300--21310), engage in commercial ventures (Com.Code, § 1201(28)(30)), and engage in labor activities (Labor Code, § 1117). Members of non-profit unincorporated associations remain free from liability for the association's debts incurred in acquiring real property. (Corp.Code, § 21100.)

Since 1962 the trend of case law has flowed toward full recognition of the unincorporated association as a separate legal entity. A member of an unincorporated association does not incur liability for acts of the association or acts of its members which he did not authorize or perform. (Orser v. George, 252 Cal.App.2d 660, 670--671, 60 Cal.Rptr. 708.) A partner in a business partnership has been allowed to maintain an action against the partnership for the loss of his truck as a result of partnership negligence. (Smith v. Hensley (Ky.), 354 S.W.2d 744, 98 A.L.R.2d 340.) In the latter case the court declared that the doctrine of imputed negligence, which would normally bar a partner's recovery against the partnership, was an artificial rule of law which should yield to reason and practical considerations; since the partnership would have been liable for damages to the property of a stranger, no just reason existed for denying recovery for damages to the property of a partner. In affirming a judgment for plaintiff the court said: '* * * under a realistic approach, seeking to achieve substantial justice, the plaintiff should be held entitled to maintain the action.'

In view of these developments over the past decade we conclude that unincorporated associations are now entitled to general recognition as separate legal entities and that as a consequence a member of an unincorporated association may maintain a tort action against his association.

Does this general rule of tort liability of an unincorporated association to its members apply in the specific instance of a condominium? A brief review of the statutory provisions which sanctions and regulate the condominium form of ownership will clarify the nature of what we are dealing with. A Condominium is an estate in real property consisting of an undivided interest in common in a portion of a parcel of real property together with a separate interest in another portion of the same parcel. (Civ.Code, § 783.) A Project is the entire parcel of property, a Unit is the separate interest, and the Common areas are the entire project except for the units. (Civ.Code, § 1350.) Transfer of a unit, unless otherwise provided, is presumed to transfer the entire condominium. (Civ.Code, § 1352.) Ownership is usually limited to the interior surfaces of the unit, a cotenancy in the common areas, and nonexclusive easements for ingress, egress, and support. (Civ.Code, § 1353.) Typically, a condominium consists of an apartment house in which the units consist of individual apartments and the common areas consist of the remainder of the building and the grounds. Individual owners maintain their own apartments, and an association of apartment owners maintains the common areas. The association obtains funds for the care of the common areas by charging dues and levying assessments on each apartment owner.

The original project owner must record a condominium Plan (Civ.Code, § 1351), and restrictions in the plan become enforcible as equitable servitudes (Civ.Code, § 1355). The plan may provide for management of the project by the condominium owners, by a board of governors elected by the owners, or by an elected or appointed agent. Management may acquire property, enforce restrictions, maintain the common areas, insure the owners, and make reasonable assessments. (Civ.Code, §§ 1355, 1358.) Only under exceptional circumstances may the condominium project be partitioned. (Civ.Code, § 1354; Code Civ.Proc., § 752b.) Zoning ordinances must be construed to treat condominiums in like manner as similar structures, lots, or parcels. (Civ.Code, § 1370.) Condominium projects with five or more condominiums are subject to rules regulating subdivided lands and subdivisions. (Bus. & Prof.Code, §§ 11004.5, 11535.1.) ...