Farthest North Girl Scout Council v. Girl Scouts of United States of America

          Petition for Rehearing Denied January 13, 2020

Page 975

          Appeal from the Superior Court of the State of Alaska, Fourth Judicial District, Fairbanks, Bethany Harbison, Judge. Superior Court No. 4FA-17-01413 CI

         Susan Orlansky, Reeves Amodio LLC, Anchorage, and Gary W. Leydig, The Law Firm of Gary W. Leydig LLC, Chicago, Illinois, for Appellants.

         James E. Torgerson, Stoel Rives, LLP, Anchorage, and Karin D. Jones, Stoel Rives LLP, Seattle, Washington, for Appellee.

         Before: Bolger, Chief Justice, Winfree, Stowers, Maassen, and Carney, Justices.

          OPINION

         CARNEY, Justice.

          I. INTRODUCTION

          The Board of Directors of the Girl Scouts of the United States of America increased the amount of annual membership dues. Farthest North Girl Scout Council, its executive director, and the chair of its board of directors challenged this increase, claiming that the corporation’s governing documents did not give the Board authority to increase membership dues. The superior court denied Farthest North’s motion for summary judgment, ruling in favor of the Girl Scouts of the United States of America that the Board had such authority. Because the corporate governing documents vest authority to establish membership dues solely in the National Council of the Girl Scouts of the United States of America, we reverse and remand for further proceedings.

          II. FACTS AND PROCEEDINGS

          A. Facts

         Girl Scouts of the United States of America (GSUSA) is a congressionally chartered nonprofit corporation.^[1] Appellants (collectively Farthest North) are leaders of the Farthest North Girl Scout Council, a chartered Girl Scout Council responsible for promoting and organizing Girl Scouts programs in Fairbanks and northern Alaska.

         The governing body of GSUSA is the National Council, comprised of approximately 1,500 individuals, including some elected by local Girl Scout Councils such as Farthest

Page 976

North.^[2] The National Council meets triennially^[3] and elects the members of the National Board of Directors (Board).^[4] The Board is comprised of the Chair of the National Board Development Committee, the Chief Executive Officer, 25 members-at-large, and officials elected by the Board members, including the President, Vice Presidents, Secretary, and Treasurer.^[5] GSUSA’s governing documents are the codified Congressional Charter and the GSUSA Constitution and Bylaws.^[6]

         A person wishing to become a Girl Scouts member must pay membership dues to GSUSA.^[7] As a Girl Scouts Council, Farthest North is responsible for collecting dues from members in its jurisdiction; it then forwards those dues to GSUSA. The National Council voted to increase membership dues nine times between 1941 and 2009. In 2009 it established a requirement that every Girl Scouts member pay annual membership dues of $12. But in 2012 the Board increased the membership dues by $3, to $15 per member. And in 2016 the Board again increased the membership dues by $10, making the annual dues $25. In neither 2012 nor in 2016 did the Board present its dues increase to the National Council for approval.

         Farthest North objected to the Board’s dues increases. Farthest North wrote to GSUSA that it would not participate in the collection of what it considered to be "unauthorized dues." Though Farthest North did collect $15 from each member, it only forwarded $12 from each to GSUSA.^[8] In response GSUSA informed Farthest North in late 2016 that it was in breach of its Charter Agreement and refused to enroll any Farthest North members, refused to allow any Farthest North members to participate in Girl Scouts activities, and refused to insure any Farthest North member who participated in any Girl Scouts activities.

          B. ...