Officers, Directors, and Trustees – Part 1

A Georgia court ruled that a church’s entire board had properly been dismissed by the church members at a duly called special business meeting.

Church Law and Tax2005-07-01

Officers, directors, and trustees – Part 1

Key point 6-06.4. Church officers and directors can be removed from office in the manner authorized by the church’s governing documents. It is common for church bylaws to give the membership the authority to remove officers and directors who engage in specified misconduct or change their doctrinal position.

Key point 6-09.2. Church members have such legal authority as is vested in them by their church’s governing documents, and in some cases by state nonprofit corporation law.
Church Officers, Directors, and Trustees
Church Members

* A Georgia court ruled that a church’s entire board had properly been dismissed by the church members at a duly called special business meeting. A church’s original articles of incorporation named an initial board of directors, and specified that the affairs of the corporation would be managed by the board of directors. A few years later church members filed restated articles of incorporation and wrote new bylaws. The new bylaws replaced the original board. However, the original board ignored this provision in the new bylaws and continued to operate as the church’s official board. To resolve this impasse several members signed a written demand for a special meeting of members for the stated purpose of conducting an election for a new board of directors. A copy of this demand was sent by certified mail to each of the original board members. The board failed to schedule the meeting, and the members themselves then scheduled the meeting for a specified date and sent a written notice of the meeting to each of the original board members and each church member. The meeting was further announced during worship services the three Sundays before it was held, and notice of the meeting was posted at the church office and on the official announcement board. The notice listed the time, date, location, and purpose of the meeting.

The original board members did not attend the special membership meeting. Nominations were taken from the members present at the meeting and a slate of five people was nominated. Next, the members were asked if anyone wished to nominate any of the original board members. No one chose to nominate them. The board of directors was then voted on as a group. Each member wishing to vote for the group was asked to stand and state his or her name. After the votes in favor of the group were counted, those wishing to vote against the group were asked to stand. The results were that 197 members voted for the nominated group to be the new board of directors, and none voted against the group. All church members who attended the meeting were allowed to vote.

The ousted board members filed a lawsuit challenging the legality of their removal. A trial court concluded that the original board members were legally removed at the special business meeting, and after that meeting had no authority to represent the church or control its assets. The former board members appealed.

A state appeals court affirmed the trial court’s ruling in favor of the church membership. It relied entirely on the Georgia Nonprofit Corporation Code which specifies that a nonprofit corporation shall hold a special meeting “if the holders of at least 5 percent of the voting power of the corporation sign, date, and deliver to any corporate officer one or more written demands … for the meeting describing the purpose or purposes for which it is to be held,” unless otherwise specified in the corporation’s articles or bylaws. The nonprofit corporations code further provides that if a special meeting is demanded and notice for a special meeting “is not given … within 30 days after the date the written demand is delivered to a corporate officer … a person signing the demand … may set the time and place of the meeting and give notice” pursuant to law. The Nonprofit Corporation Code defines notice as follows:

(a) A corporation shall give notice consistent with its bylaws of meetings of members in a fair and reasonable manner. (b) Any notice that conforms to the requirements of subsection (c) of this Code section is fair and reasonable, but other means of giving notice may also be fair and reasonable when all the circumstances are considered; provided, however, that notice of matters referred to in paragraph (2) of subsection (c) of this Code section must be given as provided in subsection (c) of this Code section. (c) Notice is fair and reasonable if: (1) The corporation notifies its members of the place, date, and time of each annual, regular, and special meeting of members no fewer than ten days (or if notice is mailed by other than first-class or registered mail or statutory overnight delivery, 30 days) nor more than 60 days before the meeting date … and (3) notice of a special meeting includes a description of the matter or matters for which the meeting is called.

The court noted that the church members properly followed the Nonprofit Corporation Code in scheduling the special meeting and voting to remove the church board members. It concluded,

“Well over five percent of the corporation’s voting members signed, dated, and mailed a demand to the board requesting a special meeting to potentially elect a new board of directors. When the board failed to set the meeting within 30 days, the members gave fair and reasonable notice (under all the facts and circumstances here) of the time, place, and purpose of the meeting …. At the meeting, a majority of the members selected a new board of directors of the church, and they chose not to nominate or elect [the original board members]. Accordingly, following their dismissal from the board, the original board members had no authority to control the temporal assets of the church. Members of Calvary Missionary Baptist Church v. Jackson, 603 S.E.2d 711 (Ga. App. 2004).

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