Are Religious Corporations Constitutional?

Like Gaul, the California Nonprofit Corporation Law has three major parts ("Gallia est omnis divisa in partes tres').  These three parts govern the formation and operation of three different types of nonprofit corporations: public benefit (Part 2),...

How A Corporation Can Become Religious Without Converting

Although I have yet to encounter the situation, California provides a mechanism for a corporation formed under the General Corporation Law to become a nonprofit religious corporation.  Since religion is involved, it may come as a surprise that no...

Must A Nonprofit Abnegate Private Gain?

The California Corporations Code includes provisions governing a wide variety of nonprofit organizations.  However, the "Big 3" categories of nonprofit corporations are the public benefit, mutual benefit and religious corporations.  While the...

May A Director Properly Rely On Her Rabbi?

In prescribing the duties of directors, California Corporations Code Section 309 provides that a director is entitled to rely on information, opinions, reports or statements prepared or presented by "counsel, independent accountants or other persons...

Volunteer Loses Bid For Employee Classification

Nonprofit organizations depend heavily upon their volunteers.  What if a court were to hold that volunteers were in fact employees  entitled to minimum and overtime wages, meal and rest breaks, wage statements and other benefits required by law? ...

Court Of Appeal Imposes "Continuous Directorship" Requirement For Standing

Several provisions of California's Nonprofit Public Benefit Corporation Law confer standing on an officer, director, or member.   See Sections 5142,  5223, 5233, and/or 5710.   In an opinion issued yesterday, the Court of Appeal addressed the...

Court Finds This Triptych Sufficient To Establish A Director's Breach Of Fiduciary Duty

Yesterday's post discussed one aspect of the Court of Appeal's holding in Coley v. Eskaton, 2020 Cal. App. LEXIS 629.  The case involved a homeowner's lawsuit against two directors of the homeowner's association and their employers.  Among other...

Director Found To Have Breached His Fiduciary Duty By Sharing Corporation's Privileged Information With His Personal Attorney

A homeowner in a common interest development sued the homeowner association and two of its directors and the directors employers.  The directors were employed by two related companies engaged in the development and support of common interest...

Home On The Grange

As a child, I was always puzzled when I saw a Grange Hall.  Was Grange a misspelling of "range"?  If not, what was a "grange"?  Only later did I learn that "grange" was derived from the Latin word, granum, meaning a seed.  The word forms part of the...

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