COON v. FREEMAN

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Court of Appeal, Fourth District, Division 1, California.

Thurlow E. COON and Tom Sherrard, Plaintiffs and Appellants, v. Louis E. FREEMAN, Henry B. Cramer, Everett J. Seeley, Irene Hickman, et al., Defendants and Respondents.

Civ. 9179.

Decided: April 24, 1969

Tom Sherrard, in pro. per., and Thomas, Borenstein & Parker, and Richard A. Thomas, San Diego, for plaintiffs and appellants. Morrow, Young & Booth and Floyd L. Morrow, San Diego, for defendants and respondents.

For Opinion on Hearing, see 83 Cal.Rptr. 217, 463 P.2d 441.

OPINION

Thurlow E. Coon and Thomas Sherrard appeal from a judgment declaring Coon is not a present member of Basic Economic Education, Inc., a non-profit corporation.

Basic Economic Education, Inc., was incorporated June 10, 1960.   The signers of the articles of incorporation were plaintiffs Coon and Sherrard, defendant Henry B. Cramer, Gordon Gran (who resigned as a director and member of the corporation and is not a party here) and Sidney Evans, since deceased.   Before this dispute arose, neither the articles nor the by-laws of the corporatiOn provided for membership in it.

In 1965 Coon responded to a notice of a directors' meeting by writing:

“Tom—Sorry by my eye is still not well and I simply can't get into the meetings, day or night.   So please accept my resignation.

Sincerely, Thurlow E. Coon

4–22–65”

The remaining directors of the corporation accepted Coon's resignation with regrets at the next regular monthly meeting.

The sole issue on appeal is whether Coon, as one who signed the corporate articles, remained a member of the corporation after he resigned as a director.

Section 104, appearing in the general provisions of the Corporations Code, provides:

“ ‘Member’ includes each person signing the articles of a nonstock corporation and each person admitted to membership therein.”

Non-profit corporations are governed by sections 9000 et seq. of the Corporations Code.   Section 9002 reads:

“The provisions of the General Corporation Law, Division 1 of this title, apply to corporations formed under this part, except as to matters specifically otherwise provided for in this part.”

Corporations Code, section 9603 deals specifically with the situation involved here where neither the articles nor the by-laws of a non-profit corporation provide for members as such.   It states:

“Where neither the articles nor by-laws of a non-profit corporation provide for members thereof as such, and in any case in which any nonprofit corporation has, in fact, no members other than the persons constituting its board of directors, the persons for the time being constituting its governing body or board are, for the purpose of any statutory provisions or rule of law relating to nonprofit corporations, the members of the corporation and shall exercise all the rights and powers of members thereof.”

 Regarding membership in a non-profit corporation where its articles and by-laws are silent on the subject, the specific provisions of section 9603 control over the general law stated in section 104.   This is so both under section 9002 and because section 9603 precludes the exercise of membership rights by anyone other than board members “for the time being” where the articles and by-laws are silent by providing the then members of the board or governing body “shall exercise all the rights and powers of members.”

Coon and Sherrard contend the corporation is estopped to deny that only Coon, Sherrard and Cramer, as the only surviving original incorporators, are now the only members of the corporation.   This is based upon a recital in a certificate of amendment of the corporate articles dated January 16, 1964, which reads:

“The corporation had admitted no members other than the incorporators and that the undersigned incorporators are members of the Board of Directors of said corporation.”

Evans, Cramer and Sherrard signed the certificate of amendment.   The recital does not create a class of members, does not amend the articles, but merely states, as a conclusion, what had or had not occurred in the past.

 Estoppel presents a question of fact the determination of which is binding on appeal unless the contrary conclusion is the only one to be reasonably drawn from the facts.  (Albers v. County of Los Angeles, 62 Cal.2d 250, 266, 42 Cal.Rptr. 89, 398 P.2d 129.)   The evidence did not compel a finding of estoppel.   It does not appear Coon relied on the certificate when he acted.   If he did, his reliance was not justified.

 When Coon resigned his directorship he gave up his standing as a member.   Those who remained directors, or were later made directors, became the ones who were to “exercise all the rights and powers of members” (Corp. Code, § 9603).

The remaining contentions of Coon and Sherrard have no vitality unless their premise is accepted that Coon was a member despite his resignation.   Because we do not accept the premise, we need not consider the contentions.

Judgment affirmed.