The president of a non-profit corporation may have implied authority to institute an action for conversion on the corporation’s behalf. “Absent a provision in the certificate of incorporation or by-laws or action by the board of directors prohibiting the president from instituting suit in the name and on behalf of the corporation, the president must be deemed, in the discharge of his or her duties, to have the authority to do so.” See Polish-American Media, Inc. v. Jozwiak, 814 N.Y.S.2d 713 (N.Y. App. Div. 2006).

Non-profit corporations are not entitled to exclusive use of generic, unregistered names. To be used exclusively, a name must be entitled to trademark protection and it cannot be “generic.” A non-profit calling itself “Ward One Democrats” sought to use the name exclusively. The court determined the name was generic because it would be “‘difficult to imagine any term of reasonable conciseness and clarity’” by which people otherwise could refer to Democrats who live in Ward One of the District of Columbia. Additionally, the name had not developed any “secondary meaning” that might warrant its exclusive use. Because the name was an unregistered, generic name the court concluded that it must remain available to everyone, including other political organizations, and could not be used exclusively by the non-profit corporation. See Ward One Democrats, Inc. v. Woodland, No. 04-CV-208, 2006 WL 1169792 (D.C. May 4, 2006).

As of 2001, non-profit corporation shareholders in Utah do not have vested property rights in the non-profit or its assets. Prior to 2001, however, it was possible to have such rights if they were created by either the non-profit’s articles or the bylaws. Thus, shareholders of a non-profit water company incorporated in 1986 brought suit against the controlling shareholder, the City of Herriman, and certain directors alleging that they suffered injury when the corporation transferred its water, wells, and other assets to the City. The court found that the corporation’s articles of incorporation created a shareholder interest in the “use” of the assets, and not a property right. That interest in use of the water survived the transfer of assets and defeated the shareholders’ claim to asset ownership. The court then concluded that, because the claims were derivative since they alleged injury to the corporation, those claims must be preceded by a demand upon the corporation. The court found that no demand had been made and therefore upheld summary judgment for the defendants. See Dansie v. City of Herriman, 134 P.3d 1139 (Utah 2006).

The Texas Non-Profit Corporation Act gives non-profit corporations the power to sell, convey, transfer, and otherwise dispose of all or any part of its property and assets. This rule applies unless “otherwise provided” in the non-profit’s governing documents. Texas property laws also give homeowners broad power. Thus, when several homeowners in a subdivision brought suit against the non-profit homeowner’s association to prevent it from selling part of the “common area” of the development, the court entered summary judgment in favor of the association because there was no limitation in the non-profit homeowner’s association’s governing documents. See Rutherford v. Norred, No. 14-05-00571-CV, 2006 WL 771467 (Tex. Ct. App. March 28, 2006).

The former Executive Director of the Boys and Girls Club of Northwest Indiana, Eddie Trail, sued certain individual members of the Executive Committee of the Board of Directors following the termination of his employment. Prior to termination of his employment, Trail had worked at the non-profit for six years under an employment contract. Trail alleged that once his contract ended, certain individual board members “contrived a study of the Club” in order to justify his termination. He alleged breach of contract, defamation, and tortious interference with employment. The court dismissed his claims finding: (1) he was an at-will employee at the time of his termination so there was no breach of contract; (2) although the limited communication of the allegedly defamatory report to other directors and officers could constitute publication, Trail did not set out the operative facts of a defamation claim because he did not allege what was included in the report or whether it was false; (3) the fact that potential employers may draw negative inferences from the Club’s refusal to comment on him for employment references did not create a defamatory statement; and (4) Trail’s claim for tortious interference failed because such interference with employment can only be committed by a third party and the directors and officers were acting on behalf of the organization, and within their authority as its agents, when they terminated Trail’s employment. See Trail v. Boys & Girls Club of NW Ind., 845 N.E.2d 130 (Ind. 2006).

Trustees of a non-profit educational corporation are its directors, and the directors of a non-profit corporation cannot be personally liable for the debts, liabilities, or obligations of the corporation. Thus, a former student’s suit against Occidental College, its trustees and various other individuals was properly dismissed as to its Board of Trustees. The student could only bring his defamation action against Occidental and the employee who made the allegedly defamatory remarks. See Antebi v. Occidental College, 47 Cal. Rptr. 3d 277 (Cal. Ct. App. 2006).

After the builders hired by the Humane Society of Northwestern Pennsylvania to build a new shelter did not pay their suppliers, the suppliers filed a mechanic’s lien against the Humane Society. The Humane Society agued that their shelter fell within the purely public purpose exception of Pennsylvania’s Mechanics’ Lien Law of 1963. The court evaluated the appropriate factors to determine whether the exception applied: (1) whether the public’s access to the services provided by the entity is by right or by permission; (2) whether the entity’s function with respect to the property is a governmental function or a proprietary function; (3) whether the entity operates with the possibility or motive of profit; and (4) whether allowing execution upon the liens would disrupt an essential public service. Based on these factors, the court found that the Humane Society shelter served a purely public purpose and was exempt from the lien laws. See Carter-Jones Lumber Co. v. Northwestern PA Humane Soc., No. SC 87083, 2006 WL 3819364 (Pa. Comm. Ct. Dec. 29, 2006).