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<font face="Times New Roman, Times, serif">"Bad facts make bad
law?" I'm indifferent about the facts/allegations in the
particular case, but I am quite concerned that the opinion will be
a template for hostile takeovers of small nonprofit groups by
dissidents. Unfortunately, while the leading WA supreme court
case (Anderson v. Enterprise Lodge No. 2, 80 Wn.App. 41, 906 P.2d
962 (1995)) on judicial deference to nonprofit boards on
governance disputes has been cited and applied muliple times by
the COA (and likely by trial courts) to nonprofits that were not
local chapters of national organizations, those all were
unpublished opinions.<br>
<br>
Concerning the proposed rule change re citation of unpublished
opinions, see:<br>
<a class="moz-txt-link-freetext" href="http://www.courts.wa.gov/court_rules/?fa=court_rules.proposedRuleDisplay&ruleId=496">http://www.courts.wa.gov/court_rules/?fa=court_rules.proposedRuleDisplay&ruleId=496</a><br>
<br>
Doug Schafer, sitting at Seatac airport<br>
<br>
</font><br>
<div class="moz-cite-prefix">On 5/23/2016 8:33 AM, Edward Clabaugh
wrote:<br>
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<div>I strongly disagree. </div>
<div id="AppleMailSignature"><br>
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<div id="AppleMailSignature">If you read the facts the non-profit
was a sham that did not operate Mukai Gardens on Vashon Island
as it was supposed. It was a vehicle to enrich the Nelsons.
Other non-profits that contributed to the worthwhile cause of
restoring the lovely Japanese garden and home found their funds
diverted. The Nelsons would not account for them. They did not
open the garden and home to the public. This situation has been
on-going for years. So people who wanted to see the non-profit
fulfill its mission finally had to take action. It has been a
long battle but finally after many years the Nelsons are out and
the non-profit is fulfilling its mission of restoring the
property and opening it to the public. <br>
<br>
Sent from my iPhone</div>
<div><br>
On May 23, 2016, at 8:11 AM, Doug Schafer <<a
moz-do-not-send="true" href="mailto:schafer@pobox.com"><a class="moz-txt-link-abbreviated" href="mailto:schafer@pobox.com">schafer@pobox.com</a></a>>
wrote:<br>
<br>
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<font face="Times New Roman, Times, serif">Please carefully
read the attached WA Court of Appeals, Div. I, opinion.
Though "unpublished," it provides a template for hostile
dissidents to takeover a membership-based nonprofit
corporation by secretly collecting member applications and
dues, then, </font><font face="Times New Roman, Times,
serif"><font face="Times New Roman, Times, serif">on the day
that the dissidents deposit the dues (without authority)
in the corporate bank account,</font> sending a 10-day
notice for a membership meeting . At that meeting, the "new
members" remove the incumbent directors. The corporate
directors and officers were unaware of the "new members"
until the meeting occurred. Our state supreme court appears
close to adopting a rule that will permit citation to
"unpublished" opinions such as this one.<br>
<br>
My fear is that this case will be used disrupt the
governance of too many nonprofit corporations.<br>
<br>
The Court of Appeals declined to apply the well-established
doctrine that courts refrain from interfering in the
internal affairs of such associations and defer to the
association's own interpretation of its rules unless that
interpretation is arbitrary or unreasonable, by asserting
that such doctrine applied only to local chapters of
national organizations. Case law is otherwise, however.<br>
<br>
When I read this opinion, I emailed one of the lawyers for
the losing parties and urged them to petition for state
supreme court review. I hear nothing back until last
Thurday, when Ms. Matthews phoned me. I spoke Friday with
her and her NYC lawyer husband, Mr. Nelson, who reported
that the COA denied their motion for reconsideration on May
2, so the deadline for a petition for review is June 2.
They are, however, "tapped out" and I sense some despair.<br>
<br>
I'm within minutes of departing on a family trip this week,
so I'm not available to assist.<br>
<br>
I write in the hope that other lawyers interested in
maintaining strong nonprofit corporations will consider
helping Ms. Matthews and Mr. Happy to petition for review.
That will allow time for them to negotiate with the
prevailing group, and possible reach a settlement whereby
they might ask Division I to withdraw its opinion. I've
seen that is another case.<br>
<br>
Nelson Happy: <a moz-do-not-send="true"
class="moz-txt-link-abbreviated"
href="mailto:jnelsonhappy@gmail.com">jnelsonhappy@gmail.com</a><br>
Mary Matthews: <a moz-do-not-send="true"
class="moz-txt-link-abbreviated"
href="mailto:matthewshistpres@gmail.com">matthewshistpres@gmail.com</a><br>
<br>
Doug Schafer, lawyer in Tacoma.<br>
</font> </div>
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<blockquote type="cite">
<div><2016_IslandLandmarks_2.pdf></div>
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