Leon J. PINSKER, Plaintiff and Appellant, v. PACIFIC COAST SOCIETY OF ORTHODONTISTS, etc., et al., Defendants and Respondents.
For Opinion on Hearing, see 81 Cal.Rptr. 623, 460 P.2d 495
Dr. Leon J. Pinsker, a dentist, appeals from a judgment granted to respondents pursuant to section 631.8 of the Code of Civil Procedure holding that Dr. Pinsker was entitled neither to damages for interference with advantageous relationships or restraint of trade nor to an injunction compelling his admission to membership in respondents, American Association of Orthodontists (A.A.O.), Pacific Coast Society of Orthodontists (P.C.S.O.), and Pacific Coast Society of Orthodontists, Southern Component (P.C.S.O. South).
Dr. Pinsker is a practicing dentist who has been duly licensed in the State of California since 1953. He obtained his degree in dentistry from Temple University School of Dentistry in 1945 and from that time to and including the date of trial he continuously engaged in the practice of dentistry. He was originally admitted to the practice of dentistry in Pennsylvania and for two and one half years immediately thereafter he served as a dental officer in the U.S. Army. After separation from the military service he opened a dental office in Pennsylvania and there he practiced general dentistry until 1954. During that period he sought to improve his ability as a practicing dentist by taking various post-graduate courses in mouth rehabilitation at the University of Pennsylvania where he then taught specialized courses in this subject. In 1953 Dr. Pinsker passed the California State Board examination and qualified to practice general dentistry here. In 1954 he moved to California and opened an office for the practice of general dentistry. Because he was interested in orthodontia, one of eight dental specialties separately recognized by the American Dental Association (A.D.A.) which sets the standards for the dental profession in this country, he took additional post-graduate courses. In 1956 he formed a partnership with Dr. Max Schleimer whose practice was limited to orthodontics and they continued as partners to practice orthodontics at an office in Long Beach.
Respondent A.A.O. is a Pennsylvania nonprofit corporation; respondent P.C.S.O. is a nonprofit corporation and one of at least eight regional constituent societies of A.A.O.; and respondent P.C.S.O. South is a nonprofit organization which is a component of the P.C.S.O. in a certain geographical area. The P.C.S.O. encompasses the Western United States and certain extraterritorial areas adjacent thereto; the P.C.S.O. South is composed of members in southern California and Arizona. The individual respondents are officers and/or committee members of the A.A.O., the P.C.S.O. or the P.C.S.O. South.
Dr. Pinsker at all times since he was licensed to practice dentistry has been a member of the A.D.A., and since 1955 he had been a member of the Harbor District of the Southern California State Dental Association of the A.D.A. The A.D.A., as the final arbiter of professional specialty qualifications, recognizes the American Board of Orthodontics (A.B.O.) as the sole certifying board within the specialty of orthodontics. The A.B.O. confers upon those duly qualified orthodontists who pass its special examinations the title of “Diplomate,” but membership in the A.A.O. is a condition precedent to consideration by the A.B.O. The Dental Practice Act of the State of California (Bus. & Prof.Code, § 1600 et seq.) makes no provision for the separate licensing of dentists specializing in orthodontia. In order for Dr. Pinsker to aspire to obtain the only recognized certification in his specialty he must, therefore, become a member of the A.A.O. and in order to do so he must first become a member of the P.C.S.O. South (representing the area in which he practices) which will in turn qualify him as a member of the P.C.S.O. and the A.A.O.
After joining Dr. Schleimer in the practice of orthodontics Dr. Pinsker enrolled at the Columbia University Division of Orthodontics where he completed a seventeen month post-graduate course and was awarded a Certificate of Training in Orthodontics, the rough equivalent of a master's degree. In this manner Dr. Pinsker obtained in excess of 1500 clock hours of course work in orthodontia at a dental school certified by the A.D.A. Council on Dental Education according to the requirements for membership in the A.A.O., P.C.S.O., and P.C.S.O. South. While still a student at Columbia University he applied for associate membership in P.C.S.O. South with the understanding that his application would be acted upon after he had completed his course work. In January 1960 he returned to California and resumed the practice of orthodontics with Dr. Schleimer. By letter dated May 20, 1960, Dr. Pinsker was informed by Dr. Neff, Secretary of the Society, that his application had been denied.
Upon receiving that letter Dr. Pinsker immediately called Dr. Neff in San Diego, told him that he was in receipt of the letter which stated no reason for his rejection and requested that he be given the reason for rejection of his application. Dr. Neff declined, on the basis of confidential information, to give him the reason but promised to have a member of the P.C.S.O. South practicing in the Long Beach vicinity contact Dr. Pinsker and suggested that he should submit his application for reconsideration. On or about June 24, 1960, Dr. Neff by letter confirmed that Dr. Pinsker would be contacted by a member from his local community and shortly thereafter appellant received a telephone call from Dr. Lee, Chairman of P.C.S.O. South. Dr. Lee inquired about the manner in which Dr. Pinsker and Dr. Schleimer conducted their practice and suggested that for various reasons, including the fact that Dr. Schleimer was not a member of A.A.O., it was not good policy or practice for the dentists to work on one another's patients. Dr. Lee further suggested that if Dr. Pinsker would alter this situation his application might be favorably reconsidered. Convinced of the validity of Dr. Lee's suggestions, appellant advised Dr. Lee that he would promptly institute appropriate changes to segregate patients. In fact, Dr. Pinsker obtained the immediate cooperation of Dr. Schleimer in revising their office procedures and instituted a color-coded card file system to insure that henceforth each would treat only his own patients. Within a few weeks the separation of patients was complete and in the interim Dr. Pinsker requested reconsideration of his application for membership in the P.C.S.O. South.
On a chance meeting with Dr. Lee a short time thereafter, Dr. Pinsker inquired about the status of his membership application and was told that it was still pending. No one again contacted Dr. Pinsker nor did anyone visit his office to investigate his procedures, practice and methods. Finally in December 1960 appellant mentioned the inaction of the P.C.S.O. South to his attorney who promptly directed an inquiry to the organization. Dr. Neff by letter of December 17, 1960, advised the attorney that Dr. Pinsker's application was still pending before the society's executive board. Thereafter by letter of January 23, 1961, signed by Dr. Neff as Secretary, Dr. Pinsker was notified of his final rejection by the executive board of the P.C.S.O. South. Once again no reason was stated for the rejection of appellant's application. On August 2, 1962, Dr. Pinsker instituted the present action alleging that he had met all of the requirements set forth according to the bylaws, rules and regulations of respondent organizations except election by the executive board to membership, and seeking damages for his exclusion and an injunction to require his admission.
Respondents' answer denied certain specific allegations of the complaint, admitted that Dr. Pinsker had satisfied all the express qualifications for membership and that he had not been elected to membership, and alleged by way of affirmative defenses that Dr. Pinsker failed to state any cause of action and that his action was barred by the statute of limitations. Although the trial court by its own declaration decided the case on its merits, it also inadvertently found and concluded that the statute of limitations (Code Civ.Proc. § 340, subd. 3) barred the action. We conclude that Dr. Pinsker's action was not barred because he alleged and proved a claim in the nature of mandamus (Thorman v. Intl. Alliance, Etc. Employees, 49 Cal.2d 629, 320 P.2d 494; James v. Marinship Corp., 25 Cal.2d 721, 155 P.2d 329, 160 A.L.R. 900; Falcone v. Middlesex County Medical Soc., 34 N.J. 582, 170 A.2d 791, 89 A.L.R.2d 952 (1961) which is governed by the four year period of limitations (Code Civ.Proc. § 343).
Appellant does not challenge the trial court's conclusions that he failed to prove any valid claim for monetary damages for respondents' purported infringement upon his advantageous relations, for malicious misconduct by respondents or any of them, or for alleged restraint of trade.
Appellant contends, however, based upon the trial court's finding that his exclusion from membership in respondent associations deprived him of substantial economic advantages, that he has established an enforceable right to a judicial decree compelling respondent associations to admit him to membership. Appellant argues that because membership is required inter alia, to obtain the only recognized certification in his specialty, to command higher fees, to attain membership in foundations dedicated to special orthodontic techniques and admission to certain advanced educational programs, such professional societies are in fact neither voluntary nor private in nature by are so clothed by a public interest and status that they should be subject to judicial compulsion to admit qualified orthodontists to membership.
The trial court expressly concluded that because appellant failed to show economic or other necessity for membership he had no right thereto enforceable by the courts and no right judicially to compel respondents to admit him; that respondent associations neither represented the State directly or indirectly nor constituted a monopoly controlling the successful practice of orthodontics; and that respondent associations were entitled to exclude appellant from membership “without having or stating any reason other than that their respective Boards of Directors had not elected him to membership.” Respondents in support of these conclusions rely upon the established principle of law that courts will refuse, in the absence of exceptional and persuasive reasons of public policy, to compel the admission of applicants to membership in voluntary private organizations. They contend that because appellant failed to demonstrate that respondent associations exercised a professional monopoly or that economic necessity existed for his membership therein, appellant failed to bring the present case within any recognized exception thereto.
Courts have, in fact, generally considered that membership in a voluntary private association is not an enforceable right but a privilege which may be granted or withheld by the association at its pleasure without judicial intervention in matters relating to admission no matter how arbitrary or unjust may be the rejection. (Tatkin v. Superior Court In and For Los Angeles County, 160 Cal.App.2d 745, 755, 326 P.2d 201.) However, the California Court of Appeal for the First Appellate District in a carefully considered decision by then Presiding Justice Raymond Sullivan determined that a dentist excluded from membership in the respondent associations is entitled to judicial review of the circumstances relating to his attempt at admission. (Kronen v. Pacific Coast Society of Orthodontists, 237 Cal.App.2d 289, 46 Cal.Rptr. 808.) In condoning the exclusion of Dr. Kronen from membership the court did not rely upon an express or implied finding by the trial court that membership in respondent associations was not an economic necessity. The decision instead emphasizes that the lower court properly considered and found upon the merits in that case that respondents had committed no unlawful acts and did not wilfully or without right exclude Dr. Kronen. “It is common knowledge that in this day of specialization, the doctor or dentist limiting his practice to a specialty enjoys a prestigious position with attendant economic advantages. It appears to us on this record that as a practical matter, an orthodontist like plaintiff cannot successfully limit his practice to orthodontics unless he becomes an active member of defendant organizations.” (Kronen v. Pacific Coast Society of Orthodontists, supra, p. 304, 46 Cal.Rptr. p. 819.) The fact that Dr. Pinsker has achieved a certain measure of success as a practicing orthodontist despite his exclusion from defendant associations, however, does not support the conclusion that the exclusion of a qualified orthodontist from membership in the sole professional organization offering the advantages of certification and specific advanced specialized training does not constitute a justiciable controversy. We conclude, instead, that “ * * * it was within the province of the trial court to review and inquire into the facts and circumstances pertinent to the alleged exclusion of plaintiff from defendant organizations to determine whether the power of these groups was exercised arbitrarily or unlawfully in order to prevent plaintiff from successfully practicing orthodontics.” (Kronen v. Pacific Coast Society of Orthodontists, supra, p. 305, 46 Cal.Rptr. p. 819, Emphasis added; see also Cunningham v. Burbank Bd. of Realtors,a 262 Cal.App.2d 211, 68 Cal.Rptr. 653.)
Emphasis in the vanguard decisions granting judicial review where individuals have been precluded from membership in trade and professional organizations has been upon the economic necessity as contrasted with mere social utility of membership. (See e.g., James v. Marinship Corp., supra, 25 Cal.2d 721, 155 P.2d 329, 160 A.L.R. 900.) “When courts originally declined to scrutinize admission practices of membership associations they were dealing with social clubs, religious organizations and fraternal associations. Here the policies against judicial intervention were strong and there were no significant countervailing policies. When the courts were later called upon to deal with trade and professional associations exercising virtually monopolistic control, different factors were involved. The intimate personal relationships which pervaded the social, religious and fraternal organizations were hardly in evidence and the individual's opportunity of earning a livelihood and serving society in his chosen trade or profession appeared as the controlling policy consideration. * * * Public policy strongly dictates that this power [of exclusion] should not be unbridled but should be viewed judicially as a fiduciary power to be exercised in reasonable and lawful manner for the advancement of the interests of the medical professional and the public generally; * * *.” (Falcone v. Middlesex County Medical Soc., 34 N.J. 582, 170 A.2d 791, 799, 89 A.L.R.2d 952, 963 (1961). See also 43 Harv.L.Rev. 993; 63 Yale L.J. 938.)
Appellant and respondents argue in effect that our decision must rest upon the essential distinction between economic advantage and economic necessity. We are persuaded that respondents' reliance upon absolute economic necessity as a prerequisite for the court to exercise jurisdiction to compel membership in a professional association is misplaced. Appellant demonstrates that by exclusion he has been deprived of educational, financial and professional advantages sufficient to establish his right to membership. His uncontradicted testimony reveals that he suffered financial loss of a speculative amount because as a certified orthodontist he could anticipate an increase in the number of doctor referrals and could command fees 20% to 40% higher than those he charged. Although appellant does ethically announce and limit his practice to orthodontics, he is deprived of the opportunity to become “Diplomate” of the American Board of Orthodontics entitled to use the initials A.B.O. following his name as a mark of professional distinction. Although appellant has taken advanced training in orthodontics, he is restricted from participation in those specific advanced courses in orthodontia for which A.A.O. membership is required. Because he was not a member of the P.C.S.O., Dr. Pinsker at the time this action was filed, was ineligible to receive referrals from the State of California Bureau of Crippled Children Services, a restriction which apparently has since been removed. Respondents emphasize that Dr. Pinsker has acquired the education and experience in his specialty to qualify him to treat and to teach specialized related courses in orthodontics; he enjoys many referrals from dentists, patients, and the families of patients; he is a prominent member of the International Association of Orthodontists (I.A.O.) which he assisted in founding in 1961; and he has established a remunerative practice which he voluntarily limits to four days a week and from which he realized in 1965 net profits of approximately $50,000. In view of appellant's prima facie qualifications and acknowledged professional accomplishments, we are led to speculate what secret prejudices or unwritten rules may in fact have served as guiding precepts for his exclusion without stated reason from respondent associations.
The A.A.O., P.C.S.O., and P.C.S.O. South hold themselves out to the public and the dental profession as having as their objectives the advancement of the science and art of orthodontics, the encouragement and sponsorship of orthodontic research, the contribution to health services, and the achievement of higher standards of excellence in orthodontic instruction and practice. (Constitutions of the American Association of Orthodontists and the Pacific Coast Society of Orthodontists.) These organizations in their bylaws, rules and regulations have set forth the requisites for membership.1 It is undisputed that although Dr. Pinsker met the stated requirements for eligibility, for undisclosed reasons he did not receive the required votes of the board of directors for election to membership. Under the express provisions of the bylaws a dentist “may be elected” to membership if he satisfies the specified requirements, but only “approval by the board of directors” ultimately confers membership. Respondent associations consistently throughout this litigation have assumed the position that appellant is not entitled to be given a reason for the rejection of his application and that respondents have no duty either under their lawful bylaws, rules and regulations or the laws of this State to show cause for appellant's exclusion.
Resort to a presumed distinction between economic advantage and economic necessity elicits specious argument. The fact that respondent associations hold themselves forth to the public and act within the dental profession as the sole association recognized by the A.D.A., itself a virtual monopoly, as the arbiter of ethical and educational standards for the practice and certification of orthodontists dignifies these organizations with a public interest and a concommitant fiduciary responsibility relative to the acceptance or rejection of applicants for membership. Although not a matter of economic necessity in the most restrictive sense, membership is a practical necessity for the orthodontists who aspires to attain maximum potential achievement and recognition in his specialty.
Dentists in all cases must be licensed by the State of California to practice general dentistry, but specialty practice is not otherwise regulated by the state and any licensed practitioner may lawfully hold himself out as a qualified specialist. But evidence of membership in a specialty group acknowledged by the A.D.A. is the only available imprimatur of specialized professional qualification.
It has been observed that where a qualified doctor is deprived of medical society membership “non-membership amounts to a partial revocation of licensure to practice medicine.” (63 Yale L.J. 938, 953.) Although the consequences of deprivation of membership in the A.A.O. are admittedly less onerous, we are confronted by similar public policy considerations countervailing the authoritarian position assumed by respondent societies. Respondents' brief summarizes their position thus: “We submit that the defendants have acted fairly and reasonably in denying plaintiff membership. In our case, the element of economic necessity is lacking. The element of reasonableness and fairness is present. On either ground the judgment should be affirmed.” The essential issue, however, is whether, in the light of their position relative to the professional and the community, respondents acted fairly in applying their bylaws and regulations so as to exclude Dr. Pinsker without showing any cause, reasonable or otherwise.
No longer can a private association, limited in membership to the practitioners of a specific trade or profession dedicated to serve the public and purporting to give ethical definition to that public service relationship, assert privileged exemption from due process in membership selection. The applicant for membership in a professional organization is entitled to due process in the consideration of his application and to a showing of just cause in the event his application is rejected. (Blende v. Maricopa County Medical Soc'y, 96 Ariz. 240, 245, 393 P.2d 926 (1964).) The courts, in determining whether just cause has been shown, must consider “whether the grounds for exclusion were (1) supported by substantial evidence and (2) reasonably related to legitimate professional purposes of the Society.” (Blende v. Maricopa County Medical Soc'y, supra, p. 245, 393 P.2d p. 930.) The California courts have further recognized that applicants for union membership may have a legitimate interest in participating in union affairs which is considerably broader than mere economic necessity or employment per se. (Thorman v. Intl. Alliance Etc. Employees, supra, 49 Cal.2d 629, 320 P.2d 494.) Individuals practicing a trade or profession have become increasingly dependent upon membership participation in groups such as unions, professional societies and trade associations which wield substantial economic and political power and significantly influence public opinion. “ * * * [T]o the extent that the organization is either delegated public power or holds itself out as regulator or de facto spokesman for a trade or profession the public has a legitimate interest in assuring that its actions are reasonably representative of the trade or profession involved and that it does not act arbitrarily or discriminately with respect to members or applicants.” (Torbriner an dGrodin, The Individual and the Public Service Enterprise in the New Industrial State, 55 Calif.L.Rev. 1247, 1255–1256 (1967).)
Respondents in their brief concede that “There is no evidence in the record that plaintiff's standard of practice in the field of orthodontics is below the standard of practice of the average orthodontist in California.” As the foregoing recital of facts demonstrates, Dr. Pinsker satisfies respondents' express qualifications. Therefore, despite the trial court's conclusion that “Denial of plaintiff's membership for application [sic] was not arbitrary, capricious or without cause as alleged, or otherwise” we must hold, since no reason at all has even been suggested for the denial of appellant's application, that the only logical inference which may be drawn is that the denial was arbitrary.
Undoubtedly respondent associations have authority to exercise discretion in approving the qualifications of applicants for membership, but they are not free to abuse this discretion, or to exercise it without reference to reasonable and expressed standards. At this stage in our socio-political history it can scarcely be contended that a professional organization affected with the public interest should be allowed to exclude otherwise qualified applicants on the basis of undisclosed reasons. The standards thus applied could be as professionally irrelevant as the applicant's race, creed, color or political affiliation. We therefore conclude that the conduct of respondent associations in the present case failed to meet judicial standards of fairness and reasonableness applicable to associations clothed with public interest.
That portion of the judgment appealed from is reversed with instructions that the trial court shall enter its order compelling respondent associations to admit Dr. Pinsker to membership in accordance with the reasons expressed in this opinion.
Respondents, who have steadfastly maintained at all stages of these proceedings the position that it is their prerogative to reject a qualified applicant without showing any cause, reasonable or otherwise, contend on petition for rehearing that because we have reversed the judgment granted on a motion under Code of Civil Procedure, section 631.8, they are now by due process entitled to show cause for denying Dr. Pinsker's application. Doubtless respondents would be correct had they at any time so framed the issues (Columbia Engineering Company v. Joiner, 231 Cal.App.2d 837, 42 Cal.Rptr. 241; Greening v. General Air–Conditioning Copr., 233 Cal.App.2d 545, 43 Cal.Rptr. 662). However, as our opinion seeks to emphasize, they have in the posture of the present case, foreclosed to themselves this opportunity. Respondents, who have put a qualified applicant to the expense of one trial to prove their principle, now claim they should have another chance to frame their position on an inconsistent theory not previously raise4d. The law is not so generous.
Petition for rehearing denied.
FOOTNOTE. FNa. Advance Report Citation: 262 A.C.A. 237.
1. The By–Laws of the Pacific Coast Society of Orthodontists provide in pertinent part as follows:“CHAPTER 1—MEMBERSHIP“Section 2.“A. The minimum qualifications for active membership shall be as prescribed by the By–Laws of the American Association of Orthodontists, AND, IN ADDITION, THE APPLICANT MUST MEET THE REQUIREMENTS FOR ASSOCIATE MEMBERSHIP IN THE PACIFIC COAST SOCIETY OF ORTHODONTISTS.“B. A dentist may be elected to associate membership in this society provided the applicant has successfully completed:“(1) an orthodontic course of a minimum of 1500 hours in a dental school certified by the A.D.A. Council on Dental Education, or“(2) eighteen months' full-time association with a practicing orthodontist who has been an active member of the American Association of Orthodontists for at least eight years, AND WHO HAS BEEN APPROVED BY THE MEMBERSHIP COMMITTEE OF THE PACIFIC COAST SOCIETY OF ORTHODONTISTS AS QUALIFIED TO ACT AS A PRECEPTOR PRIOR TO THE PERIOD OF ASSOCIATION WITH THE APPLICANT, such association to have been registered with the Pacific Coast Society of Orthodontists in accordance with such regulations as may be prescribed by the society.“(3) In all cases the training must satisfy the memership committee in the component society, and the applicant must be recommended by two active members of the component to which he applies.”“Election to Membership“Section 3.“A. Application for active membership shall be made on the form prescribed by the American Association of Orthodontists, and submitted to the secretary of the component in whose jurisdiction the applicant practices, accompanied by the initiation fee and dues of the component, of this society and of the American Association of Orthodontists for the current calendar year.“B. If approved by the component, the application, with the initiation fee and dues of this society and of the American Association of Orthodontists, shall be forwarded to the secretary-treasurer of this society for action by the board of directors 30 days after publication in the Bulletin.“C. Approval by the board of directors confers membership upon the applicant, who shall present himself upon notice by his component society to subscribe to the Pledge and the Code of Ethics, and be inducted into this society.”“AMERICAN ASSOCIATION OF ORTHODONTISTS CONSTITUTION AND BY–LAWS“ * * *“CHAPTER 1 —SECTION 2“ * * *“(A) A person who is in the exclusive practice of orthodontics and who is a member in good standing of his local, state and national dental organizations may be elected to membership through his constituent society, provided the applicant has been:“1. Five years in the exclusive practice of orthodontics, including a successfully completed orthodontic course of a minimum of 1500 hours in an approved dental school. The applicant must be recommended by two active members of the constituent society within whose jurisdiction he intends to practice.”