First Bostonview Management, LLC v. Bostonview Corporation, et al. (Lawyers Weekly No. 11-118-15)

NOTICE:  All slip opinions and orders are subject to formal revision and are superseded by the advance sheets and bound volumes of the Official Reports.  If you find a typographical error or other formal error, please notify the Reporter of Decisions, Supreme Judicial Court, John Adams Courthouse, 1 Pemberton Square, Suite 2500, Boston, MA, 02108-1750; (617) 557-1030; SJCReporter@sjc.state.ma.us   13-P-1237                                       Appeals Court   FIRST BOSTONVIEW MANAGEMENT, LLC  vs.  BOSTONVIEW CORPORATION & others.[1] No. 13-P-1237. Norfolk.     October 1, 2014. – August 19, 2015.   Present:  Berry, Hanlon, & Carhart, JJ. Charity.  Corporation, Charitable corporation, Religious, Sale of assets, Officers and agents, Board of directors.  Sale, Of corporate property, Real estate.  Contract, Sale of real estate, Ratification.  Real Property, Purchase and sale agreement.  Agency, Ratification.       Civil action commenced in the Superior Court Department on November 13, 2009.   The case was heard by Kenneth J. Fishman, J., on a motion for summary judgment, and a separate and final judgment was ordered by him.     David B. Summer (Elliot M. Sherman with him) for the plaintiff. Carole C. Cooke (Nicholas B. Carter with her) for Bostonview Corporation.      BERRY, J.  The plaintiff, First Bostonview Management, LLC (First Bostonview), appeals from the judgment entered pursuant to Mass.R.Civ.P. 54(b), 365 Mass. 821 (1974), after the allowance of the summary judgment motion by the defendant, Bostonview Corporation (Bostonview), a charitable corporation, on First Bostonview’s claims stemming from its attempt to purchase substantially all of Bostonview’s real property.  We affirm the judgment. As is further discussed herein in more particularized detail, the corporate board of directors of a charity and the powers of corporate officers in a charitable organization, such as Bostonview, are subject to strict fiduciary standards in the conduct of the charity’s business affairs.  The Supreme Judicial Court has made clear that only specific authorization can bind a charitable corporation to an “extraordinary transaction” entered into by its corporate officers, and that authority to enter into a contract which would divest the charitable corporation “of the very essence” of its existence lies beyond the power of the charitable corporate board to delegate to corporate officers.  Boston Athletic Assn. v. International Marathons, Inc., 392 Mass. 356, 364-367 (1984). In this case, the sale of substantially all of the Bostonview church property (consisting of a church sanctuary, a parish meeting hall, a large apartment complex, offices, and parking spaces on prime land on Beacon Hill near the Massachusetts State House) was indisputably an “extraordinary transaction,” and, if completed to the end would have stripped Bostonview of the very essence of its existence as a charitable corporation, organized “exclusively for religious, charitable, scientific and education purposes” subject to the holding of the church property and the […]

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