DUANE KEMMER, KAREN KEMMER, and TIM DOLPH, Plaintiffs-Appellants,
BOB NEWMAN, PHYLLIS MILLER, and RUTH SMITH, Defendants-Respondents, and BOB QUINN, Defendant.
Opinion No. 157
from the District Court of the First Judicial District, State
of Idaho, Bonner County. Hon. Barbara A. Buchanan, District
court decision, reversed.
Vernon & Weeks, Coeur d'Alene, for appellants. Daniel
M. Keyes argued.
Featherston Law Firm, Sandpoint, for respondents. Brent C.
Kemmer, Karen Kemmer, and Tim Dolph (Appellants) appeal the
Bonner County district court's decision that Bob Newman,
Phyllis Miller, and Ruth Smith (Respondents) were properly
elected as directors of New Life Missions, Inc. church (NLM)
at a special membership meeting. On appeal, Appellants argue
the district court erred in reaching its decision because the
special meeting was improperly called in violation of the
Idaho Nonprofit Corporation Act. We reverse.
FACTUAL AND PROCEDURAL BACKGROUND
incorporated as a non-profit corporation in 2001 by Jack
Kirk, Ray Breeden, Kenneth Ewing, and Alan Kirk, all of whom
served on the initial NLM Board of Directors(Board).
NLM's Bylaws were also adopted in 2001 by the same men.
The NLM Bylaws require that a membership roll of the
"voting membership" be kept. Testimony at trial was
clear that no such roll was ever kept. The NLM Bylaws also
called for monthly meetings of the Board and an annual
membership meeting to elect directors and conduct other
church business. In practice, however, those meetings did not
August 2009, NLM was administratively dissolved for failure
to timely file an annual report with the Idaho Secretary of
State. That same month, Karen Kemmer, acting as
secretary/treasurer of NLM, filed an application for
reinstatement, which was accepted and approved by the Idaho
Secretary of State. The reinstatement report for NLM shows
that at the time of reinstatement, James Tapani was
president/senior pastor,  Karen Kemmer was secretary/treasurer,
and Ruth Smith, Duane Kemmer, and Tim Dolph were directors.
In February 2010, Tapani resigned as senior pastor.
March 2010, the Board met and discussion was held on who
should be the new senior pastor. Bob Newman was asked if he
would be interested in serving as the senior pastor, to which
he replied that he would. Newman began serving in the senior
pastor role from that time forward; however, no formal vote
on Newman's appointment as senior pastor was taken by the
Board or the voting membership. In May 2010, the Board
scheduled a meeting with Ken Ewing to discuss the possibility
of merging NLM with Ewing's church, the Church on the
the meeting with Ewing, Kemmer made statements to Newman, Smith,
and others that he no longer wanted to be a Board member.
However, Kemmer attended meetings on July 17 and 21, 2010.
Sometime in July 2010, although not approved by the Board,
Dolph made a statement to members of NLM that the Board had
decided to merge NLM with Ewing's church. Evidence showed
that the members in attendance at the meeting did not respond
favorably to Dolph's announcement, and Dolph left the
meeting upset. Thereafter, Smith, acting on her own, called
for a member's special meeting to be held on August 1,
2010. The special meeting was announced from the church
pulpit for three consecutive Sundays-July 18, 25, and August
1, 2010. Kemmer and Dolph both assert that they had no
knowledge of the announcements or the August 1, 2010 special
meeting. At the special meeting, Phyllis Miller, Bob Newman,
and Ruth Smith were elected as directors.
Appellants brought suit on December 7, 2011, alleging that
Smith was not authorized to call the August 1, 2010 special
meeting, and, therefore, the election of directors at that
meeting was invalid. In May 2014, the district court held a
bench trial, and on August 8, 2014, issued its Memorandum
Decision. In its decision, the district court ruled that
Respondents were the rightful directors of NLM because the
August 1, 2010 special meeting was properly called and Newman
had the authority to approve the special meeting. The
district court found that both Kemmer and Dolph had
"resigned and/or absented themselves" as directors.
Thus, the district court held that Smith, as the only
remaining director, was authorized under Idaho Code section
30-3-47 to call a special meeting. The district
court also found that during a Board meeting held on March
28, 2010, Newman was appointed senior pastor of NLM.
Appellants timely appeal.
STANDARD OF REVIEW
Court exercises free review over the district court's
conclusions of law, but will not set aside a finding of fact
unless it is clearly erroneous. Insight LLC v.
Gunter, 154 Idaho 779, 783, 302 P.3d 1052, 1056 (2013).
When deciding whether findings of fact are clearly erroneous,
this Court does not substitute its view of the facts for that
of the trial court. Bramwell v. South Rigby Canal
Co., 136 Idaho 648, 650, 39 P.3d 588, 590 (2001).
Rather, this Court examines the record to see if challenged
findings of fact are supported by substantial and competent
evidence. Miller v. St. Alphonsus Reg'l Med. Ctr.,
Inc., 139 Idaho 825, 832, 87 P.3d 934, 941 (2004).
Evidence is regarded as substantial if a reasonable trier of
fact would accept it and rely upon it in determining whether
a disputed point of fact has been proven. Id.
raise two issues on appeal: (A) whether Newman was properly
appointed as senior pastor, and (B) whether Smith improperly
called the August 1, 2010 special meeting.
Newman was not properly ...