Willowmere Cmty. Ass'n, Inc. v. City of Hous. , 370 N.C. 553 ( 2018 )

IN THE SUPREME COURT OF NORTH CAROLINA
No. 419PA16
Filed 2 March 2018
WILLOWMERE COMMUNITY ASSOCIATION, INC., a North Carolina non-profit
corporation, and NOTTINGHAM OWNERS ASSOCIATION, INC., a North
Carolina non-profit corporation
v.
CITY OF CHARLOTTE, a North Carolina body politic and corporate, and
CHARLOTTE-MECKLENBURG HOUSING PARTNERSHIP, INC., a North
Carolina non-profit corporation
On discretionary review pursuant to N.C.G.S. § 7A-31 of a unanimous decision
of the Court of Appeals, ___ N.C. App. ___, 792 S.E.2d 805 (2016), affirming an order
of summary judgment entered on 14 April 2015 by Judge Forrest D. Bridges in
Superior Court, Mecklenburg County. Heard in the Supreme Court on 12 December
2017.
Law Office of Kenneth T. Davies, P.C., by Madeline J. Trilling and Kenneth T.
Davies, for plaintiff-appellants.
Thomas E. Powers III, Assistant City Attorney, and Terrie Hagler-Gray, Senior
Assistant City Attorney, for defendant-appellee City of Charlotte.
Moore & Van Allen PLLC, by Glenn E. Ketner, III, Anthony T. Lathrop, and
William M. Butler, for defendant-appellee Charlotte-Mecklenburg Housing
Partnership, Inc.
BEASLEY, Justice.
In this appeal we consider the extent to which a corporate entity must
affirmatively demonstrate compliance with its internal bylaws and governance
procedures before it may invoke the jurisdiction of the General Court of Justice. The
WILLOWMERE CMTY. ASS’N V. CITY OF CHARLOTTE
Opinion of the Court
Court of Appeals held that plaintiffs lacked standing because they failed to strictly
comply with their corporate bylaws in bringing this suit. We agree with plaintiffs
that a showing of strict compliance is not necessary to satisfy the requirements of our
standing jurisprudence. Accordingly, we reverse the decision of the Court of Appeals.
Plaintiffs Willowmere Community Association, Inc. (Willowmere) and
Nottingham Owners Association, Inc. (Nottingham) are non-profit corporations
representing homeowners in the residential communities of Willowmere and
Nottingham located in Charlotte. Plaintiffs instituted this litigation on 14 March
2014 by filing a Petition for Review in the Nature of Certiorari in Superior Court,
Mecklenburg County, challenging the validity of a zoning ordinance enacted by the
City of Charlotte and seeking a declaratory judgment that the zoning ordinance is
invalid.1 The challenged zoning ordinance permits multifamily housing on parcels of
land abutting property owned by plaintiffs. Defendants each filed a response in which
they denied the material allegations in the petition and moved to dismiss the action
under Rules 12(b)(1) and 12(b)(6) of the North Carolina Rules of Civil Procedure.
With leave of the trial court, on 9 July 2014, plaintiffs amended their initial filing
under Rule 15(a) of the North Carolina Rules of Civil Procedure to restyle it as a
complaint for declaratory judgment, alleging the same causes of action and
1 Plaintiffs’ filing originally named the City of Charlotte and Charlotte-Mecklenburg
Housing Partnership, Inc. (CMHP) as well as New Dominion Bank, the owner of the parcels
subject to the zoning ordinance, as defendants. New Dominion Bank is not a party to this
appeal.
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requesting the same principal relief—that the court invalidate the zoning ordinance.
Defendant CHMP answered plaintiffs’ amended complaint on 17 October 2014, and
defendant City of Charlotte filed its new answer on 22 October 2014. Plaintiffs and
defendants each filed cross-motions for summary judgment on the issue of the
ordinance’s validity.
The trial court granted defendants’ motions for summary judgment and denied
plaintiffs’ motion for summary judgment based on the court’s conclusion that it lacked
subject matter jurisdiction to adjudicate plaintiffs’ claims. Specifically, the trial court
reasoned that plaintiffs lacked standing to bring the instant suit because they each
failed to comply with various provisions in their corporate bylaws when their
respective boards of directors decided to initiate this litigation.2 The trial court relied
on the evidence submitted at the summary judgment hearing, which established that
neither plaintiff explicitly authorized filing the present suit during a meeting with a
quorum of directors present, either in person or by telephone. The trial court
concluded that plaintiff Willowmere lacked standing because its board of directors
agreed to initiate the lawsuit in an e-mail conversation, which was not an expressly
2 While none of defendants’ motions or pleadings to the trial court explicitly raised the
issue of plaintiffs’ standing to bring suit, the trial court was permitted to consider the
threshold question of its own subject-matter jurisdiction in ruling on the parties’ cross-
motions for summary judgment. Lemmerman v. A.T. Williams Oil Co., 318 N.C. 577, 580,
350 S.E.2d 83, 86 (1986) (“Every court necessarily has the inherent judicial power to inquire
into, hear and determine questions of its own jurisdiction, whether of law or fact, the decision
of which is necessary to determine the questions of its jurisdiction.” (citing Burgess v.
Gibbs, 262 N.C. 462, 465, 137 S.E.2d 806, 808 (1964))).
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authorized substitute for the board’s written consent to take action without a formal
meeting under Willowmere’s corporate bylaws. Similarly, as to plaintiff Nottingham,
the trial court concluded that its decision to institute this litigation was defective
under its bylaws which require, inter alia, a formal meeting with a quorum of
directors present (either in person or by telephone), recorded minutes of the meeting
reflecting the proceedings of the board of directors, the board’s written consent for
any action outside of a formal meeting, and an explanation of its action posted by the
board within three days after its decision. The trial court’s view was that, “[w]hile
Plaintiffs’ bylaws each permit their directors to sue regarding matters affecting their
planned communities, the directors can only act through a meeting or a consent
action without a meeting,” and “[n]either Willowmere nor Nottingham has met their
burden to show that their directors acted to initiate this litigation through one of
these means in this case.”3
Plaintiffs timely appealed to the Court of Appeals, which affirmed the trial
court’s award of summary judgment to defendants. Willowmere Cmty. Ass’n, Inc. v.
City of Charlotte, ___ N.C. App. ___, ___, 792 S.E.2d 805, 812-13 (2016). On 26
3The trial court also stated that, if it had subject-matter jurisdiction over this matter,
it would have invalidated the zoning ordinance because the ordinance was adopted in a
manner inconsistent with the requirements of N.C.G.S. § 160A-383 (2015). That issue is not
before us, and we express no opinion on the merits of plaintiffs’ claim for declaratory
judgment or the validity of the zoning ordinance. See N.C. R. App. P. 16(a) (limiting this
Court’s review to the issues presented in the petition for discretionary review and properly
presented in the parties’ briefs to this Court).
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January 2017, this Court allowed plaintiffs’ petition for discretionary review. We
now reverse the decision of the Court of Appeals.
This Court reviews a trial court’s decision dismissing a case for lack of subject
matter jurisdiction and a trial court’s award of summary judgment de novo. Mangum
v. Raleigh Bd. of Adjust., 362 N.C. 640, 644, 669 S.E.2d 279, 283 (2008) (applying de
novo review to a motion to dismiss for lack of standing); In re Will of Jones, 362 N.C.
569, 573, 669 S.E.2d 572, 576 (2008) (“Our standard of review of an appeal from
summary judgment is de novo; such judgment is appropriate only when the record
shows that ‘there is no genuine issue as to any material fact and that any party is
entitled to a judgment as a matter of law.’ ” (quoting Forbis v. Neal, 361 N.C. 519,
523-24, 649 S.E.2d 382, 385 (2007))).
“As a general matter, the North Carolina Constitution confers standing on
those who suffer harm: ‘All courts shall be open; [and] every person for an injury
done him in his lands, goods, person, or reputation shall have remedy by due course
of law . . . .’ ” Mangum, 362 N.C. at 642, 669 S.E.2d at 281-82 (alterations in original)
(quoting N.C. Const. art. I, § 18). “The rationale of [the standing] rule is that only
one with a genuine grievance, one personally injured by a statute, can be trusted to
battle the issue.” Stanley v. Dep’t of Conservation & Dev., 284 N.C. 15, 28, 199 S.E.2d
641, 650 (1973).
“The ‘gist of the question of standing’ is whether the party
seeking relief has ‘alleged such a personal stake in the
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outcome of the controversy as to assure that concrete
adverseness which sharpens the presentation[s] of issues
upon which the court so largely depends for illumination of
difficult constitutional questions.’ ”
Id. at 28, 199 S.E.2d at 650 (alteration in original) (quoting Flast v. Cohen, 392 U.S.
83, 99, 20 L. Ed. 2d 947, 961 (1968) (quoting Baker v. Carr, 369 U.S. 186, 204, 7 L.
Ed. 2d 663, 678 (1962))). “[W]hether [a] party has standing to attack the
constitutionality of a statute is a question of law, which may not be settled by the
parties.” Id. at 28-29, 199 S.E.2d at 650 (first citing Nicholson v. State Educ.
Assistance Auth., 275 N.C. 439, 447-48, 168 S.E.2d 401, 406-07 (1969); then citing
State ex rel. Carringer v. Alverson, 254 N.C. 204, 208, 118 S.E.2d 408, 410-11 (1961)).
“Legal entities other than natural persons may have standing.” River Birch
Assocs. v. City of Raleigh, 326 N.C. 100, 129, 388 S.E.2d 538, 555 (1990). “To have
standing the complaining association or one of its members must suffer some
immediate or threatened injury.” Id. at 129, 388 S.E.2d at 555 (citing Hunt v. Wash.
State Apple Advert. Comm’n, 432 U.S. 333, 342, 53 L. Ed. 2d 383, 393 (1977)). “[A]n
association may have standing in its own right to seek judicial relief from injury to
itself and to vindicate whatever rights and immunities the association itself may
enjoy.” Id. at 129, 388 S.E.2d at 555 (quoting Warth v. Seldin, 422 U.S. 490, 511, 45
L. Ed. 2d 343, 362 (1975)).
[A]n association has standing to bring suit on behalf of its
members when: (a) its members would otherwise have
standing to sue in their own right; (b) the interests it seeks
to protect are germane to the organization’s purpose; and
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(c) neither the claim asserted nor the relief requested
requires the participation of individual members in the
lawsuit.
Id. at 130, 388 S.E.2d at 555 (citing Wash. State Apple Advert., 432 U.S. at 343, 53 L.
Ed. 2d at 394). “When an organization seeks declaratory or injunctive relief on behalf
of its members, ‘it can reasonably be supposed that the remedy, if granted, will inure
to the benefit of those members of the association actually injured.’ ” Id. at 130, 388
S.E.2d at 555 (quoting Warth, 422 U.S. at 515, 45 L. Ed. 2d at 364).
The Court of Appeals decision below and defendants’ arguments to this Court
are not based on plaintiffs’ failure to meet the elements of associational standing
described in River Birch or on the contention that plaintiffs have not “alleged . . . a
[sufficient] personal stake in the outcome of the controversy.”4 Stanley, 284 N.C. at
28, 199 S.E.2d at 650 (quoting Flast, 392 U.S. at 99, 20 L. Ed. 2d at 961). Instead,
defendants contend that, by failing to follow the internal governance procedures
mandated by their respective bylaws, plaintiffs’ boards of directors “had no authority
to act on behalf of [plaintiffs] in filing and prosecuting this lawsuit.” In support of
their argument, defendants rely entirely on Court of Appeals cases holding that a
4 In their briefs to the Court of Appeals, defendants additionally argued that plaintiffs
lacked standing because they failed to establish an injury in fact stemming from the zoning
ordinance and failed to meet the associational standing elements discussed in River Birch.
However, defendants did not obtain a ruling from the trial court on this issue to preserve it
for appellate review, and defendants did not include this issue in the list of issues for
discretionary review pursuant to N.C. R. App. P. 15(d). As a result, that issue is not before
us, and we decline to address it now. See N.C. R. App. P. 16(a).
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corporate entity “lacked standing” to bring suit based on (1) a challenge asserted by
a member of the plaintiff entity that the plaintiff failed to comply with explicit
prerequisites to filing suit imposed by the entity’s bylaws or (2) the corporate entity’s
lack of privity of estate with the defendants against whom the entity sought to enforce
restrictive covenants. See Beech Mountain Prop. Owners’ Ass’n v. Current, 35 N.C.
App. 135, 139, 240 S.E.2d 503, 507 (holding that, because the property owners’
association did not, itself, own any property in the development at issue, it “lack[ed]
the capacity” to enforce restrictive covenants that run with the land against other
property owners in the development); accord Laurel Park Villas Homeowners Ass’n
v. Hodges, 82 N.C. App. 141, 143-44, 345 S.E.2d 464, 465-66 (1986) (reaffirming the
holding in Beech Mountain that, without owning property in the community at issue,
an incorporated homeowners’ association “lacked standing” to enforce restrictive
covenants against property owners appearing in their deeds), disc. rev. denied, 318
N.C. 507, 349 S.E.2d 861 (1986); see also Peninsula Prop. Owners Ass’n v. Crescent
Res., LLC, 171 N.C. App. 89, 95-97, 614 S.E.2d 351, 353-56 (2005) (holding that the
plaintiff homeowners’ association lacked standing when it failed to comply with its
bylaw provision requiring a two-thirds majority vote of members to approve filing suit
against the defendant on behalf of the association, when this issue was raised by the
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defendant property owner who was a member of the property owners’ association5),
appeal dismissed and disc. rev. denied, 360 N.C. 177, 626 S.E.2d 648 (2005).
Because Beech Mountain and Laurel Park deal entirely with the plaintiff
associations’ capacity to enforce restrictive covenants against the defendant property
owners, those cases have no applicability here. See Sedberry v. Parsons, 232 N.C.
707, 710-11, 62 S.E.2d 88, 90 (1950) (“Where the owner of a tract of land subdivides
it and sells distinct parcels thereof to separate grantees, imposing restrictions on its
use pursuant to a general plan of development or improvement, such restrictions may
be enforced by any grantee against any other grantee, either on the theory that there
is a mutuality of covenant and consideration, or on the ground that mutual negative
equitable easements are created.”) (emphasis added) (quoting 26 C.J.S. Deeds § 167,
at 548-49 (1941) (footnotes omitted)). The “standing” at issue in those cases, more
appropriately characterized as privity of estate, was the plaintiffs’ capacity to enforce
restrictive covenants applicable to real property against the defendants and had
nothing to do with the corporate bylaws or internal governance procedures of the
plaintiff homeowners’ associations.6 See Runyon v. Paley, 331 N.C. 293, 302, 416
5 Though not emphasized in the Court of Appeals’ analysis in Peninsula, the fact that
the defendant, Crescent Resources, LLC, owned property in the community governed by the
association was noted in the opinion, clear from the record, and briefed by the parties. See
Peninsula, 171 N.C. App. at 95, 614 S.E.2d at 355 (“Crescent owned . . . two of the nine
hundred lots within the [planned residential community] at the time the [plaintiff] filed its
complaint” and had “voting rights.”).
6 The plaintiff homeowners’ association in Laurel Park argued that it had standing to
enforce the restrictive covenants against the defendants under N.C.G.S. § 47A-10, which
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S.E.2d 177, 184 (1992) (“Thus, where the covenant is sought to be enforced by
someone not a party to the covenant or against someone not a party to the covenant,
the party seeking to enforce the covenant must show that he has a sufficient legal
expressly permitted the manager or board of directors of a condominium homeowners’
association to sue on the association’s behalf against a unit owner to enforce, inter alia, the
association’s “bylaws,” “administrative rules and regulations,” and “covenants, conditions
and restrictions” in deeds. 82 N.C. App. at 142, 345 S.E.2d at 465 (quoting N.C.G.S. § 47A-
10 (1985)). The Court of Appeals rejected this argument because the complaint named the
association as the plaintiff rather than “the manager or board of directors on behalf of the
association” and the statute only expressly addressed the authority of the association’s
manager or board to sue but not that of the association itself. See id. at 142, 345 S.E.2d at
465; N.C.G.S. § 47A-10. Applying its earlier decision from Beech Mountain, the Court of
Appeals in Laurel Park concluded that the plaintiff homeowners’ association could not
enforce restrictive covenants against a unit owner in the community because the association
itself (the only named plaintiff) did not own property in the community. 82 N.C. App. at 143,
345 S.E.2d at 465.
The Court of Appeals in Laurel Park went on to address, in dicta, the plaintiff’s further
argument that its corporate bylaws gave it authority to bring suit on behalf of the unit
owners. Id. at 143-44, 345 S.E.2d at 466. The Court of Appeals rejected this argument as
well, reasoning that “[t]here is nothing in the articles or the bylaws authorizing persons other
than the board, its officers, or the membership to act on behalf of the corporation, and nothing
in the record suggesting that any of these authorized this action,” and “the statute specifically
designates who may sue to enforce the restrictions” but does not designate the association
itself. Id. at 144, 345 S.E.2d at 466. The reference in Laurel Park to the association’s bylaws
was not, as the Court of Appeals opinion in this case suggests, an instance of a corporation
“fail[ing] to comply with [its] own bylaws in bringing [an] action,” Willowmere, ___ N.C. App.
at ___, 792 S.E.2d at 812 (citing Laurel Park, 82 N.C. App. at 143-44, 345 S.E.2d at 466), but
rather a recognition that the bylaws cannot create corporate authority beyond what was
provided by statute. Additionally, the statute the Court of Appeals construed in Laurel Park
specifically governed condominium unit owners’ associations and has no applicability to a
homeowners’ association of a planned community incorporated under the North Carolina
Nonprofit Corporation Act. Compare N.C.G.S. § 47C-1-102 (2017) (North Carolina
Condominium Act) with N.C.G.S. § 47F-1-102 (2017) (North Carolina Planned Community
Act).
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relationship with the party against whom enforcement is sought to be entitled to
enforce the covenant.”).
In Peninsula, the Court of Appeals held that the property owners’ association
lacked standing to commence legal proceedings against Crescent Resources, LLC
(“Crescent”), the previous developer of the community, because the association failed
to comply with an explicit provision in its bylaws that required any litigation against
Crescent to be approved by a two-thirds majority vote of all association members
entitled to vote. 171 N.C. App. at 94, 97, 614 S.E.2d at 354, 356. But that case is
distinguishable from the case at bar because in Peninsula, the failure of the plaintiff
to comply with the bylaws was raised by Crescent, which was a member of the
plaintiff association. See id. at 91, 95, 614 S.E.2d at 353, 355. One of the underlying
issues raised by the plaintiff in Peninsula was the very fact that Crescent, as
developer of the community, had drafted the association’s bylaws and explicitly
included the two-thirds approval provision, which, in the plaintiff’s view, contravened
Crescent’s fiduciary duties as the controlling member of the association when the
bylaws were created. See id. at 90, 94-95, 614 S.E.2d at 352, 354-55. As a member
of the plaintiff association and as the party that was clearly intended to benefit from
the two-thirds approval requirement in the bylaws, Crescent was entitled to raise the
association’s failure to comply with this provision of its bylaws as a bar to the
plaintiff’s suit. Nonetheless, neither this Court nor the Court of Appeals has ever
held (until the Court of Appeals opinion in this case) (1) that a defendant who is a
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stranger to the plaintiff association may assert that the plaintiff’s failure to abide by
its own bylaws necessitates dismissal of the plaintiff’s complaint for lack of standing
or (2) that a corporate defendant must affirmatively demonstrate compliance with its
bylaws and internal governance procedures in order to have standing.
Nothing in our jurisprudence on standing requires a corporate litigant to
affirmatively plead or prove its compliance with corporation bylaws and internal
rules relating to its decision to bring suit. Cf. Mangum, 362 N.C. at 644, 669 S.E.2d
at 283 (“We . . . note that North Carolina is a notice pleading jurisdiction, and as a
general rule, there is no particular formulation that must be included in a complaint
or filing in order to invoke jurisdiction or provide notice of the subject of the suit to
the opposing party.” (citing Mangum v. Surles, 281 N.C. 91, 99, 187 S.E.2d 697, 702
(1972) (“[I]t is the essence of the Rules of Civil Procedure that decisions be had on the
merits and not avoided on the basis of mere technicalities.”))). Indeed, since “standing
is a ‘necessary prerequisite to a court’s proper exercise of subject matter jurisdiction,’
” Crouse v. Mineo, 189 N.C. App. 232, 236, 658 S.E.2d 33, 36 (2008) (quoting Aubin v.
Susi, 149 N.C. App. 320, 324, 560 S.E.2d 875, 878, disc. rev. denied, 356 N.C. 610,
574 S.E.2d 474 (2002)), and can be challenged “at any stage of the proceedings, even
after judgment,” In re T.R.P., 360 N.C. 588, 595, 636 S.E.2d 787, 793 (2006) (quoting
Pulley v. Pulley, 255 N.C. 423, 429, 121 S.E.2d 876, 880 (1961), appeal dismissed and
cert. denied, 371 U.S. 22, 9 L. Ed. 96 (1962)), adopting such a rule would subject
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countless judgments across North Carolina to attack for want of subject matter
jurisdiction. We decline to adopt such a rule.
There is no evidence in this case suggesting that any member of the
communities of Willowmere or Nottingham opposed plaintiffs’ prosecution of this
suit. We decline to permit a defendant who is a stranger to an association to invoke
the association’s own internal governance procedures as an absolute defense to
subject matter jurisdiction in a suit filed by the association against that defendant.
If a member of either plaintiff association disagrees with the decision to file suit, the
proper vehicle to challenge the association’s failure to comply with its respective
bylaws in making that decision is a suit against the nonprofit corporation brought by
the aggrieved member or members of the association or, in certain circumstances, a
derivative action. Cf. N.C.G.S. § 55A-3-04 (2017) (providing that, “the validity of [a]
corporate action shall not be challenged on the ground that the [nonprofit] corporation
lacks or lacked power to act” except in a proceeding brought against the corporation
“by a member or a director” of the corporation, “the Attorney General,” or “[i]n a
proceeding by the corporation, directly, derivatively, or through a receiver, trustee,
or other legal representative, against an incumbent or former director, officer,
employee, or agent of the corporation”);7 id. § 55A-7-40 (2017) (authorizing and
7Plaintiffs argued to this Court that defendants are precluded under N.C.G.S. § 55A-
3-04 from challenging “the validity of corporate action” to bring this suit because defendants
are not listed among the classes of parties authorized to bring such a challenge in section
55A-3-04(b). Because plaintiffs failed to raise this argument before the trial court, it is not
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explaining the procedures by which to prosecute a derivative action under the North
Carolina Nonprofit Corporation Act). “[T]he General Statutes . . . provide means for
association members harmed by the improper commencement of this suit to seek
redress from the courts if they wish to do so—either by seeking to stay or dismiss the
action, or by pursuing a separate action against the appropriate parties for the
unauthorized filing of the lawsuit.” Willowmere, ___ N.C. App. at ___, 792 S.E.2d at
813 (Dietz, J., concurring) (emphasis added); see N.C.G.S. § 47F-2-103(a) (2017)
(providing that “the declaration, bylaws, and articles of incorporation [of a planned
community] form the basis for the legal authority for the planned community to act,”
and “are enforceable by their terms”).
This holding also comports with the reasoning of other jurisdictions that have
considered the issue. See Lake Forest Master Cmty. Ass’n v. Orlando Lake Forest
Joint Venture, 10 So. 3d 1187, 1195-96 (Fla. Dist. Ct. App.) (concluding that a specific
Florida statute requiring the approval of a majority of members of a homeowners’
association entitled to vote before initiating any litigation involving amounts in
properly preserved for our review. See N.C. R. App. P. 10(a); Dogwood Dev. & Mgmt. Co. v.
White Oak Transp. Co., Inc., 362 N.C. 191, 194-96, 657 S.E.2d 361, 363-64 (2008).
Accordingly, we decline to address whether defendants’ assertion that plaintiffs failed to
comply with their respective bylaws in their decision to bring this action amounts to a
challenge that their action was ultra vires or “[in]valid[ ] . . . on the ground that the
corporation lacks or lacked power to act.” See N.C.G.S. § 55A-3-04. It is sufficient to say
that, while a member of either plaintiff association could permissibly challenge the
association’s failure to comply with its bylaws in instituting this suit (regardless of whether
the challenge falls within the scope of N.C.G.S. § 55A-3-04), defendants may not.
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controversy over $100,000 was for the protection of members and could not be
asserted as an affirmative defense to suit by a non-member defendant), review denied,
23 So. 3d 1182 (Fla. 2009); Little Can. Charity Bingo Hall Ass’n v. Movers Warehouse,
Inc., 498 N.W.2d 22, 24 (Minn. Ct. App. 1993) (“[A] third party has no power to
challenge corporate action based on [a violation of the entity’s bylaws].”); see also
Stolow v. Greg Manning Auctions Inc., 258 F. Supp. 2d 236, 249 (S.D.N.Y.) (“A third-
party, who is not a member of the association or corporation nor a party to the bylaws,
lacks standing to bring suit against an organization for violation of its bylaws.”), aff’d,
80 F. App’x 722 (2d Cir. 2003); Port Liberte II Condo. Ass’n v. New Liberty Residential
Urban Renewal Co., 435 N.J. Super. 51, 66, 86 A. 3d 730, 739 (App. Div. 2014)
(holding that the plaintiff condominium homeowners’ association had standing to sue
the defendant developers and various contractors despite procedural defects in the
approval of the litigation based, in part, on the logic that the defendants could not
enforce the bylaws of the association, including one requiring members to authorize
litigation, because they were not members of the association).
Accordingly, we hold that, despite plaintiffs’ failure to strictly comply with
their respective bylaws and internal governance procedures in their decision to
initiate this suit, they nonetheless “possess a ‘sufficient stake in an otherwise
justiciable controversy’ to confer jurisdiction on the trial court to adjudicate this legal
dispute.” Willowmere, ___ N.C. App. at ___, 792 S.E.2d at 813 (quoting Peninsula,
171 N.C. App. at 92, 614 S.E.2d at 353). For the reasons stated above, the decision
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of the Court of Appeals is reversed, and this case is remanded to that court for further
remand to the trial court for further proceedings not inconsistent with this opinion.
REVERSED AND REMANDED.
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