YAGNESH PATEL VS. THE HINDU COMMUNITY CENTER (C-000109-17, BERGEN COUNTY AND STATEWIDE)

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the
internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-3486-18T3
YAGNESH PATEL,
Plaintiff-Appellant,
v.
THE HINDU COMMUNITY
CENTER, THE HINDU COMMUNITY
CENTER BOARD OF TRUSTEES,
VINAYAK RAVAL, NITIN DESAI,
SURESH PATEL, and PARTHIV
RAVAL,
Defendants-Respondents.
________________________________
Submitted June 1, 2020 – Decided July 27, 2020
Before Judges Sumners and Natali.
On appeal from the Superior Court of New Jersey,
Chancery Division, Bergen County, Docket No. C-
000109-17.
Dunne Dunne & Cohen LLC, attorneys for appellant
(Frederick Richard Dunne, III, of counsel and on the
brief; Mena H. Ibrahim, on the brief).
Dominic V. Caruso, attorney for respondents.
PER CURIAM
In this religious organization dispute, plaintiff Yagnesh Patel filed a four-
count complaint against defendants The Hindu Community Center (HCC), the
HCC Board of Trustees (the Board), and HCC Board members, Vinayak Raval
(HCC's past president), Parthiv Raval (HCC's current president), Nitin Desai
(HCC's secretary), and Suresh Patel. Plaintiff alleged defendants violated the
HCC bylaws by refusing to make him a member of the HCC and they also: (1)
engaged in ultra vires transactions, N.J.S.A. 15A:3-2; (2) unlawfully refused his
inspection of organizational records, N.J.S.A. 15A:5-24; (3) breached their
fiduciary duty; and (4) were unjustly enriched. Plaintiff further alleged he had
the right to inspect the HCC's records and the Board owed him a fiduciary duty
because his significant financial and volunteer contributions to the HCC
qualified him as a legal representative of the HCC for purposes of the Nonprofit
Corporation Act (NCA), N.J.S.A. 15A:1-1 to 15-2.
Plaintiff appeals from the Chancery Division order granting defendants'
summary judgment motion dismissal of his complaint and denying his summary
judgment motion. Plaintiff also appeals an order denying his motion for
reconsideration and his request to add Atul Shah as a plaintiff. We affirm both
orders.
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I.
We summarize the following facts from the record, viewing "the facts in
the light most favorable to [plaintiff,] the non-moving party." Globe Motor Co.
v. Igdalev, 225 N.J. 469, 479 (2016) (citing R. 4:46-2(c)).
In support of his summary judgment motion, plaintiff certified the HCC
is a 501(c)(3) non-profit entity, whose bylaws state the organization's purpose
is to "secure the advancement and maintenance of the Hindu religion by
providing for religious worship and education." As to membership in the HCC,
the bylaws state, "[a]ny person who agrees to abide by and support the purposes
of this corporation[] may apply for membership" and all membership
"applications . . . shall be approved by the majority vote of the Board of
Trustees." The bylaws further provide the Board of Trustees is comprised of
"five members who shall be members in good standing for a period of at least
two years, be . . . resident[s] of New Jersey, have [a] permanent residence or
U.S.A. citizenship, and have no criminal record."
Plaintiff's certification also states he has donated more than $25,000 to the
HCC and volunteered hundreds of hours for the HCC's activities over the past
twenty years, which qualifies him to be an HCC member. However, his previous
applications for HCC membership were denied by defendants. He alleged his
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status as a donor, devotee, volunteer, and fundraiser gave him a "vested interest
in seeing how the funds [he] donated and help[ed] to generate were used by the
HCC's trustees and management[,]" and that he is "a [b]eneficiary of the HCC
pursuant [to] its bylaws and therefore" has the "right to challenge the Board's
actions in the context of being a beneficiary."
Plaintiff claimed defendants violated the organization's bylaws by not
conducting regular meetings and mismanaging the organization's money.
Plaintiff points specifically to his $15,000 donation to the HCC in 2004 for the
purchase of silver doors depicting Laxmi-Narayan, a Hindu deity, but the funds
were used for a different purpose. He argued the HCC's fiscal malfeasance is
evident when it turned down his offer of interest-free loans, yet accepted
interest-bearing loans from the Board's family members. He also alleged he paid
a $101 membership fee which has not been returned. Plaintiff further contended
defendants have not provided him access to the HCC's financial records despite
his repeated requests.
Atul Shah, a Board member from 2004 to 2010, signed a certification
stating he paid his membership fee at the same time as plaintiff, and like
plaintiff, his membership was denied without reimbursement of his membership
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fee. Shah also stated if the court did not allow him to be added as a plaintiff in
the matter, he would file a separate, identical lawsuit.
In a ten-page single-spaced written decision granting defendants'
summary judgment application and dismissing plaintiff's complaint, the trial
judge concluded "[d]espite [p]laintiff's devotion to the HCC and various
financial contributions to the [c]enter over the years, . . . these factors alone do
not simply cloak [p]laintiff with membership status and afford him inspection
rights under N.J.S.A. 15A:5-24." The judge explained while plaintiff asserted
Shah complained of similar misconduct by the Board, "Shah was a board of
trustee member, likely . . . entrusted with rights and privileges not granted to
ordinary devotees[,]" unlike plaintiff who was not a member. The judge also
noted there was no authority which would permit the court to compel defendants
to accept plaintiff as a member of the HCC. In addition, citing Passaic Nat'l
Bank & Tr. Co. v. E. Ridgelawn Cemetery, 137 N.J. Eq. 603, 608 (E. & A. 1945)
the judge explained under the NCA "it is the Attorney General of the State of
New Jersey who has the authority to prosecute allegations of fraud or
mismanagement by the [b]oard of [t]rustees of a non-profit organization
pursuant to his common law supervisory obligations regarding such charities."
The judge finally explained:
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The [c]ourt cannot find any evidence that would
suggest [p]laintiff is a "member" of the HCC. . . .
Therefore, the [c]ourt cannot find that [p]laintiff has
standing to request disclosure of confidential books and
financial records, nor can [p]laintiff demonstrate that
the HCC owed or breached any fiduciary duty to him as
a [d]evotee.
It is also clear at this time that even if the purported
wrongdoings by the Board of Trustees are taken as true,
[p]laintiff is not the proper vehicle to investigate the
wrongdoings based on his clear lack of standing.
Plaintiff filed a timely motion for reconsideration and, in the alternative,
sought to add Shah as a plaintiff based upon "new evidence" of Shah's
certification to join the suit. The judge denied the motion for reasons set forth
in a written decision attached to his order. In denying plaintiff's motion, the
judge pointed out the motion advanced the same argument made on summary
judgment "cit[ing] the large amounts of time, energy and money afforded to the
[HCC] as both a donor and devotee." Because the judge already found plaintiff
was not a member in the summary judgment decision, he determined, based upon
Cummings v. Bahr, 295 N.J. Super. 374, 384 (App. Div. 1996), there was no
basis for reconsideration as plaintiff "failed to point to any 'palpably incorrect
or irrational' holding or finding by [him], nor ha[d] [he] failed to consider or
appreciate the significance of probative competent evidence." The judge found
plaintiff improperly raised an argument not presented in his summary judgment
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motion: that his 2004 charitable donation should have been returned when his
expressed purpose for the gift was not honored. The judge also pointed out
plaintiff's complaint did not seek this relief by alleging fraud, and, moreover,
the statute of limitations had already expired for the claim.1
Lastly, the judge acknowledged while it was within his discretion to
permit an amendment of the complaint to add Shah as plaintiff, he declined to
do so. The judge reasoned:
The [c]ourt has previously emphasized that [p]laintiff
is entitled to refile his application with . . . Shah as an
added party, at which point this [c]ourt is certain that
. . . [d]efendants will respond accordingly. However,
the [c]ourt is sensitive to the fact that new parties can
undoubtedly lead to new claims and legal theories,
which subsequently will indisputably lead to the need
to defend against those legal theories. . . . Shah was
seemingly available to be added to this case during the
entirety of its two-year history, yet [p]laintiff[] chose
not to add him as a party. The [c]ourt finds that it would
be nothing short of prejudicial and inequitable to
simply add . . . Shah to the case and proceed
immediately to trial without giving [d]efendant[s] the
time and resources [they] would ordinarily be afforded
to prepare [their] case. Therefore, the [c]ourt will not
allow leave to amend the [c]omplaint at this time.
This appeal followed.
1
Under N.J.S.A. 2A:14-1, the statute of limitations for fraud claims is six years.
Catena v. Raytheon Co., 447 N.J. Super. 43, 52 (App. Div. 2016).
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II.
On appeal, plaintiff asserts three primary arguments in challenging the
judge's denial of his summary judgment and grant of summary judgment to
defendants. First, he maintains his unreturned membership fee creates a genuine
question of material fact that precludes summary judgment to defendants.
Alternatively, plaintiff also asserts his membership status is evidenced by his
volunteer work, donations, and demonstrated devotion to HCC. He maintains
he was given considerable responsibility to organize and run the administration
of the HCC's facilities and events and helped raise more than $123,000 for the
organization since 2010.
Second, plaintiff argues even if he is not a member, his service as a donor,
devotee, volunteer, and fundraiser gives him "standing to challenge and/or
question the use of funds donated based the representations made in order to
solicit the funds, his ongoing relationship with the HCC and the fact that he paid
for his membership and has not had the funds returned." Plaintiff further
contends "the trust he has placed in the HCC, evidenced by the donations over
such a length of time, created a relationship allowing [him] to challenge the use
of the donated funds," and as a result defendants owe him a fiduciary duty.
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Third, relying on Adler v. Save, 432 N.J. Super. 101, 104 (App. Div.
2013), plaintiff reiterates his reconsideration motion argument that because his
donation for a specific purpose was not used for that purpose, he has standing
to challenge the Board's conduct.
Appellate review of a ruling on a motion for summary judgment is de
novo, applying the same standard governing the trial court. Davis v. Brickman
Landscaping, Ltd., 219 N.J. 395, 405 (2014). Thus, we consider, as the motion
judge did, "whether the competent evidential materials presented, when viewed
in the light most favorable to the non-moving party, are sufficient to permit a
rational factfinder to resolve the alleged disputed issue in favor of the non-
moving party." Id. at 406 (quoting Brill v. Guardian Life Ins. Co. of Am., 142
N.J. 520, 540, (1995)). "If there is no genuine issue of material fact," an
appellate court must then "decide whether the trial court correctly interpreted
the law." DepoLink Court Reporting & Litig. Support Servs. v. Rochman, 430
N.J. Super. 325, 333 (App. Div. 2013) (citation omitted). We accord no
deference to the trial judge's legal conclusions. Nicholas v. Mynster, 213 N.J.
463, 478 (2013) (citing Zabilowicz v. Kelsey, 200 N.J. 507, 512-13 (2009)). We
review the judge's ruling on the discovery motion for abuse of discretion. State
v. Enright, 416 N.J. Super. 391, 404 (App. Div. 2010).
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Our review of a motion for reconsideration is more deferential. "[T]he
decision to grant or deny a motion for reconsideration rests within the sound
discretion of the trial court." Pitney Bowes Bank, Inc. v. ABC Caging
Fulfillment, 440 N.J. Super. 378, 382 (App. Div. 2015) (citing Capital Fin. Co.
of Del. Valley, Inc. v. Asterbadi, 398 N.J. Super. 299, 310 (App. Div. 2008)).
Reconsideration should only be used for those cases which fall into that narrow
corridor in which either: "'1) the [c]ourt has expressed its decision based upon a
palpably incorrect or irrational basis, or 2) it is obvious that the [c]ourt either
did not consider, or failed to appreciate the significance of probative, competent
evidence.'" Ibid. (alterations in original) (citing Asterbadi, 398 N.J. Super. at
310).
With these principles in mind, we conclude the trial judge's grant of
summary judgment to defendants and denial of summary judgment to plaintiff
was appropriate.
The NCA provides the ability to contest a corporate action and inspection
rights for members of organizations incorporated under it. While the NCA 's
definition of the term "member" is not conclusive, our jurisprudence gives
authority to individual organizations to govern membership. N.J.S.A. 15A:3-2
provides:
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No act of a corporation . . . shall be invalid because the
corporation was without capacity or power to do that
act . . . , but the lack of capacity or power may be
asserted:
a. In a proceeding by a member or trustee against the
corporation to enjoin the doing of any act . . . .
Further, N.J.S.A. 15A:5-24(b) and (d) provide in pertinent part:
b. Upon the written request of any member, the
corporation shall mail to that member its balance sheet
as at the end of the preceding fiscal year, and its
statement of income and expenses for that fiscal year.
....
d. This section shall not impair the right of any court,
upon proof of a member of proper purpose, irrespective
of the period of time during which the member shall
have been a member of record, and irrespective of the
total number of memberships held by that person, to
compel the production for examination by the member
of the books and records of account, minutes and record
of members of a corporation.
The NCA defines "[m]ember" as "a participant in a corporation having
such rights or obligations therein as provided in this act." N.J.S.A. 15A:1 -2(h).
In Leeds v. Harrison, 9 N.J. 202 (1952), our Supreme Court discussed the
legal effect of a religious non-profit's bylaws. In finding judicial intervention
of an organization's bylaws was generally only justifiable "where the
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complaining parties have suffered an invasion of their civil rights, of person or
of property[,]" the Court explained:
Corporate powers have their origin in a sovereign grant.
Generally, they are derived from the articles of
incorporation and the laws of the state under which the
corporate body came into being. A corporation has
those powers which are implicit in the charter as well
as those which are expressed. Authority not reasonably
within the corporate grant is excluded. But whatever
may be fairly deemed an incident of the power
expressly conferred by the charter is within the grant
unless expressly prohibited. The instrument is to
receive a reasonable construction to serve the general
end in view.
[Id. at 211-12, 215 (citations omitted).]
The Leeds Court further expounded on religious and quasi-religious
societies, holding such organizations "may adopt a constitution and laws for the
regulation of their affairs, if conformable and subordinate to the charter and not
repugnant to the law of the land; and they are binding upon the membership until
modified or repealed in due course." Id. at 217.
Here, in order to become an HCC member, the HCC's bylaws stipulate a
person's membership application must be approved by the Board. Plaintiff's
application was not approved, and he instead relies on his status as a donor and
volunteer to give him the status of a member. However, plaintiff advances no
legal argument to support his claims and does not point to any law which the
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HCC has violated in denying him membership. Therefore, his challenge of the
Board's actions under the NCA and his claim the Board improperly denied him
inspection rights of HCC's records were properly dismissed.
Plaintiff's assertion the HCC Board breached a fiduciary duty owed to a
non-member plaintiff by not conducting regular meetings, not adhering to HCC
bylaws, and by turning down his offer of interest-free loans is without merit.
Plaintiff's reliance on F.G. v. MacDonell, 150 N.J. 550 (1997), is misplaced as
the facts there are inapposite to his situation with the HCC. In F.G., the plaintiff
parishioner filed a claim for breach of fiduciary duty against a defendant
clergyman because the plaintiff sought counseling from the defendant, who in
turn pursued and induced the plaintiff into a sexual relationship with him. Id.
at 556. In finding that a clergyman could owe a fiduciary duty to a parishioner,
our Supreme Court ruled "[e]stablishing a fiduciary duty essentially requires
proof that a parishioner trusted and sought counseling from the pastor. A
violation of that trust constitutes a breach of the duty." Id. at 565. Plaintiff does
not allege he sought to establish a fiduciary relationship with defendants or an
HCC member that was breached. Plaintiff's financial donations or voluntary
contributions to the HCC are distinctly different from the fiduciary duty the
plaintiff in F.G. established in seeking counseling from the pastor.
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There is no factual or legal support for plaintiff's unjust enrichment claim.
To establish a prima facie case for unjust enrichment he "'must show both that
defendant[s] received a benefit and that retention of that benefit without
payment would be unjust' and that [he] 'expected remuneration' and the failure
to give remuneration unjustly enriched . . . defendant[s]." EnviroFinance Grp.,
LLC v. Envtl. Barrier Co., LLC, 440 N.J. Super. 325, 350 (App. Div. 2015)
(citing VRG Corp. v. GKN Realty Corp., 135 N.J. 539, 554 (1994)).
Plaintiff claims defendant Board members were unjustly enriched when
they retained interest payments on loans to the HCC, which were made by their
family members. If the Board would have accepted his loan offers to the HCC
with no interest, plaintiff contends the Board members would not be enriched.
Considering plaintiff has not shown he expected remuneration for his no interest
loan offer to the HCC, he cannot make a prima facie claim of unjust enrichment
and dismissal on summary judgment of the claim was proper.
Likewise, there is no merit to plaintiff's claim defendants owed him a
fiduciary duty as a donor. First, we note because plaintiff only raised such a
claim in his motion for reconsideration, the judge was correct in holding it was
not properly before the court. See Medina v. Pitta, 442 N.J. Super. 1, 18 (App.
Div. 2015) (citing Cummings, 295 N.J. Super. at 384) ("Filing a motion for
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reconsideration does not provide the litigant with an opportunity to raise new
legal issues that were not presented to the court in the underlying motion.").
Plaintiff's fiduciary duty claims are also substantively without merit. He
cites to three cases arguing the Board is required to respond to his information
request and allow for his review of financial records because it owes him a
fiduciary duty as a donor, Adler, 432 N.J. Super. at 104 (holding "a charity that
solicits and accepts a gift from a donor, knowing that the donor 's expressed
purpose for making the gift was to fund a particular aspect of the charity 's
eleemosynary mission, is bound to return the gift when the charity unilaterally
decides not to honor the donor's originally expressed purpose"), Ludlam v.
Higbee, 11 N.J. Eq. 342, 348 (N.J. Ch. 1857) (holding that donors who conveyed
property in charitable trust to be used by "all denominations of Christians" could
seek redress from the court to have the "property restored to its original purpose
and trusts" when some denominations of Christians were subsequently excluded
from the premises), and Kelly v. McIntire, 123 N.J. Eq. 351 (N.J. Ch. 1938)
(proscribing a portion of a church congregation from unilaterally withdrawing
from its national affiliation and joining a new affiliation when its church
property was acquired and held for religious uses according to the tenets of its
original denomination).
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While Adler and Ludlam offer relief to donors of charitable and religious
organizations, the type of relief granted is different than that sought here by
plaintiff. Plaintiff seeks to conduct oversight of the Board and the HCC , which
was not the plaintiffs' gravamen in those two cases. Nowhere in his underlying
complaint does he demand the return of his donation as the plaintiffs demanded
in those two cases. Neither of those two cases nor Kelly imposes a fiduciary
duty to donors to non-profit organizations on the singular basis of their gift
giving. In fact, plaintiff cites no law to support his claim that defendants owe
him a fiduciary duty or were unjustly enriched due to his magnanimous donation
of money, time and service.
III.
Finally, as to the denial of his reconsideration motion we conclude the
judge did not err, noting his appellate argument is limited solely to the judge's
decision rejecting his request to amend the complaint to add Shah as a plaintiff. 2
Citing Notte v. Merchs. Mut. Ins. Co., 185 N.J. 490, 500-01 (2006),
Kernan v. One Washington Park Urban Renewal Assocs., 154 N.J. 437, 457
2
We consider all other arguments raised before the trial judge and not briefed
waived. See Sklodowsky v. Lushis, 417 N.J. Super. 648, 657 (App. Div.
2011)("An issue not briefed on appeal is deemed waived."); Pressler & Verniero,
Current N.J. Court Rules, cmt. 5 on R. 2:6-2 (2020).
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(1998), and Fisher v. Yates, 270 N.J. Super. 458 (App. Div. 1994), plaintiff
contends motions for leave to amend pleadings are left to the sound discretion
of the court in light of the factual situation existing at the time each motion is
made, particularly where the motion is to add new parties or claims on the eve
of trial. Plaintiff argues in Notte, 185 N.J. at 501, the Court held the exercise of
discretion requires a trial judge to consider "a two-step process: whether the
non-moving party will be prejudiced, and whether granting the amendment
would nonetheless be futile." Under the second prong, plaintiff argues to
determine "futility" the judge should not consider the ultimate merits of the
claim as "those determinations must be made 'in light of the factual situation
existing at the time each motion is made.'" Ibid. (quoting Kernan, 154 N.J. at
457). He asserts leave to amend should be liberally granted "even if the ultimate
merits of the amendment are uncertain." G&W, Inc. v. Borough of E.
Rutherford, 280 N.J. Super. 507, 516 (App. Div. 1995).
Specifically, plaintiff argues adding Shah as a plaintiff, or having Shah
replace him in the complaint, would correct any perceived deficiency and allow
this matter to quickly proceed to trial. Plaintiff argues there is no question a
claim exists. He argues because litigation has been ongoing for two years and
the only other alternative "is starting all over," for defendants to contend this
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would prejudice them is "laughable." Plaintiff asserts the real prejudice and
harm to all parties, is starting litigation anew. He points out Shah has already
been deposed and submitted a certification, and the parties will spend
unnecessary 1egal fees if the case isn't allowed to proceed to trial with Shah as
plaintiff.
Under our standard of review, we conclude the judge did not err in
denying defendant's motion for reconsideration to permit plaintiff to amend his
complaint to add Shah as plaintiff. We first note neither plaintiff nor Shah
complied with Rule 4:9-1, by including a copy of the proposed pleading with a
motion to amend. Plaintiff's counsel's reconsideration motion argument that
Shah "has the same grievances and would essentially be filing the same case,"
which echoed Shah's certification submitted with the motion that he would "file
essentially an identical complaint against the same [d]efendants," does not
comply with Rule 4:9-1.
Putting aside this procedural deficiency, we do not agree with plaintiff the
judge abused his discretion in concluding adding Shah in the midst of this two-
year litigation would be prejudicial to defendants who would then be compelled
to reconsider their defense strategy and restart discovery related to Shah's
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claims. Hence, Shah should be left to fulfill his assertion that he will file his
own complaint.
To the extent we have not addressed any of plaintiff's arguments it is
because we conclude they lack sufficient merit to warrant discussion in written
opinion. R. 2:11-3(e)(1)(E).
Affirmed.
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