IliiJiPiililliiji ii mmm. Hi h' III Jcii UNIVERSITY OF CALIFORNIA LOS ANGELES SCHOOL OF LAW LIBRARY "b-o I UNINCORPORATED ASSOCIATIONS. THEIR LEGAL STATUS IN PENNSYLVANIA, AND SOME OF THE RIGHTS AND OBLIGATIONS INCIDENT THERETO. MEREDITH PRIZE ESSAY OF THE UNIVERSITY OF PENNSYLVANL-i FOR THE YEAR 1888. BY GUY LE R. STEVICK, OF THE PHILADELPHIA BAK. PHILADELPHIA: T. & J . W. JOHNSON & CO., 535 CHESTNUT STREET. 1889. T St its . COPTEIGHT BT T. & J. W. JOHNSON & CO 1889. COLLINS PRINTING HOUSE, 705 Jayne Street. CONTENTS. CHAPTER I. UNINCORPORATED ASSOCIATIONS DEFINED — THEIR ORIGIN AND GROWTH. § 1. Unincorporated associations defined. § 2. Origin. § 3. Pennsylvania legislation. § 4. Judicial growth. CHAPTER II. THE STATUS OF UNINCORPORATED ASSOCIATIONS. § 5. Determination of their status. § 6. Distinction between unincorporated associations and partnerships. § 7. Unincorporated associations contemplating no charity. § 8. Status, inter se and as to third persons. § 9. English authorities. § 10. Beneficial societies, early English view. § 11. Modern English view. § 12. Pennsylvania view. § 13. Several Pennsylvania cases inconsistent with the modern view. § 14. Conclusion. CHAPTER III. LIABILITY OF MEMBERS. § 15. Divisions of subject. § 16. Principles of agency. § 17. Liability, inter se and as to third persons — Constitution and rules. § 18. Liability of a member to individuals. § 19. Liability of a member to the association. § 20. Liability of a member for acts of the association. § 21. Liability of members of beneficial associations. § 22. Liability of a member for acts of other members. § 23. Authority of a committee. § 24. Conclusion. IV CONTENTS. CHAPTER IV. MANAGEMENT OF AN UNINCORPOKATED ASSOCIATION CHANGE OF RULES EXPULSION OF MEMBERS, ETC. § 25. Change of association rules. § 2G. Powers of majority. § 27. Power of expulsion. § 28. Summary of powers of expulsion. § 29. Equitable interference. § 30. Bona fide exercise of power of expulsion. § 31. Opportunity of defence. § 32. Removal from positions of trust. § 33. Rights within the association. CHAPTER V. ASSOCIATION RIGHTS AND LIABILITIES PROPERTY — CONTRACTS FORMS OF SUIT. § 34. Rights of property. § 35. Disposition of property after dissolution. § 36. Suits against members individually. § 37. Contractual rights, form of suits. § 38. Suits by a member against an association. § 39. Suits by an association against a member. § 40. Suits by a stranger against an association. § 41. Suits by an association against a stranger. § 42. Basis of judicial jurisdiction. § 43. Liability of membership to execution and sale. TABLE OF CASES CITED. THE REFERENCE IS TO PAGES. ENGLISH CASES. Adams vs. O'Brien 11, 39 vs. Rippoii 11, 39 Alexander vs. Alexander 17 Attorney-General vs. Murdock 45, 47 Beaumont vs. Meredith Beckman vs. Drake Broomley rs. Williams Buckley rs. Carter Burls vs. Smith 2, 14, 25, 59 8 18, 62, 67 15 43 Caldicott vs. Griffiths 16, 27 Cockburn vs. Thompson 2, 15, 25, 69 Cockerell vs. Aucompte 43 Cox vs. Hickman 8 Cross vs. Williams 8 CuUen vs. Duke of Queensbury 17, 25, 27, 43, 59 Dawkins vs. Antrobus Dean vs. Bennett Delauney vs. Strickland Ellison vs. Bignold Fisher vs. Keane Flemyng vs. Hector Gaflfrs. Evans Gardner vs. Freemouth Gray vs. Pearse 45, 51 53 17, 33, 43 15 48, 53, 63 11, 27, 33, 34, 39,42 18 52 17 Harrison vs. Millar 18 Harvey r.s. Beckwith 18 Hopkinson vs. Marquis of Exeter 52, 63 Innes vs. Wylie 53 Lees i\i. Smith 18 Lloyd vs. Loaring 2, 14, 25 London Marine Insurance Co., In re 16, 27 Lyttleton vs. Blackburn 34, 52, 71 Pearce vs. Piper 2, 15, 25 27, 62 Queen rs. Robinson 17, 20 vs. Waite 17, 20 Raggett vs. Bishop rs. Musgrave 34, 35, 35, 63, 66 66 Redway vs. Sweeting Reeve rs. Parkins 17 15 Regina rs. Murphy vs. Wooley Regnell i^s. Lewis 20 20 17 Rex vs. Hall 20 Richardson-Gardner vs. Freemantle 51, 63 Rlgby vs. Connol 71 St. James Club, In re 2, 11, 12, 27, 43 St. George Building Society, In re 17 Strong vs. Harvey 15, 27 Todd rs. Emley Waugh rs. Carver Willis rs. Child Wood rs. Finch 2, 11, 12, 27, 33, 41, 42, 59 10, 33 53 43 PENNSYLVANIA CASES. App vs. Lutheran Congregation 4, 42, 70 Ash vs. Guie 18, 24, 28, 34, 37, 57, 60 Babb rs. Reed 22, 25, 27, 29, 31 Bauer's Appeal 70 Beasly vs. Allyn 56, 72 Beatty's Appeal 43, 73 Beech vs. Harris 50 Blenon's Estate 23 Brown rs. Griffin 55, 66, 69 rs. Lutheran Church 2, 70 Butchers' Beneficial Association 50 Chambers vs. Calhoun 36, 59, 60 Commonwealth rs. Green 52 vs. St. Patrick's Ben. Soc'y 49 rs. Volz • 2, 20, 28, 65 Edinboro Academy rs. Robinson 35 VI TABLE OF CASES CITED. [The reference is to pages.] Kiclibanm vs. Irons 8, 20, 28, 32, 33, 35, 59 Evans vs. Philadelphia Club 50 IS. Wistar 73 Frey vs. Fidelity Lodge 52 (iass's Appeal 68 Henry vs. Dietrich Hess vs. Wertz 4, 46 25, 67 27 Riser's Appeal Kurz vs. Eggert 29, 39, 68 65 Leech vs. Harris vs. Leech Lowry is. Reed 19, 28, 48, 49, 63 73 2 MacDowell vs. Ackley 48 Magill vs. Brown 3, 4, 5 Maguire's Estate 18, 62, 69 Means cs. Presbyterian Congregation 4 Metropolitan Base Ball Club vs. Sim- mons 21, 28, 59, 70 O'Hara vs. Stack 52, 72 Paul vs. Keystone Lodge 29, 31, 39, 61, 64 Phipps vs. Jones 4, 36, 61, 62 Presbyterian Congregation vs. Johnson 4, 46 Protchett vs. Schaefer 22, 24, 27, 28, 29, 31, 38, 64 Ramsey's Appeal 4 Ridgely vs. Dobson 2, 25, 28 Ryerss vs. Congregation of Blossburg 36, 61, 62, 70 Schriber vs. Rapp 19, 28, 63 Sirjgerly vs. Johnson 63, 73 Skilton vs. Webster 4 Sperry's Appeal 53 Sutter vs. Dutch Church 2, 46 Thomas vs. Elmaker 18, 26, 27 Thompson vs. Adams 34, 73 Trustees vs. Sturgeon 4 Unangst vs. Shortz 2, 4, 46, 66 Witman vs. Lex 3, 4, 5 Witmer vs. Schlatter 25, 27 Baptist Association vs. Hart's Execu- tors, 4 Wheaton. 28 5 Burt vs. Lathrop, 52 Mich. 106 20 Ingles vs. Trustees, 3 Peters, 114 5 Livingstone vs. Lynch, 5 Johns. Chan. 573 58 MISCELLANEOUS CASES. Richmond vs. Judy, 6 Mo. App. 20 Vidal vs. Executors of Girard, 2 How. 128 4 White vs. Brownell, 3 Abbott's Prac- tice Rep. N. S. 318 19 ACTS OF ASSEMBLY, CONSTITUTIONS, ETC. Act of 1712 4 of 1715 4 of January, 1831 4 Constitution of 1776 4 of I79U 4 Act of 17th Feltfuary, 1818 4 of 21st March, 1836 1 of 15th June, 1836 5 Bradford's Laws 4 Smith's Laws 4 Act of 16th June, 1836 4, 17, 22 Constitution of 1838 4 Act of 2d August, 1842 4 of 26th April, 1855 4 of 2d June, 1874 1 of 28th April, 1876 5, 39, 52 of 20th June, 1883 5, 48 UNINCORPORATED ASSOCIATIONS. IN PENNSYLVANIA. CHAPTER I. UNINCORPORATED ASSOCIATIONS DEFINED— THEIR ORIGIN AND GROWTH. § 1. Unincorporated associations, in the most general sense of the term, include every union of individuals for a common purpose, which is not incorporated. Many of these associations have acquired, either at common law or by statute, peculiar characters ; for instance, at common law we have partnerships, principal and agent, and the domestic relations; by statute, limited partnerships,^ joint stock companies,^ etc. But there are a great many unin- corporated associations which fall under none of these particular heads, and it is the legal status of these asso- ciations which we shall endeavor to determine in this • Act 21 March, 1836, P. L. 143. ^ A joint-stock company such as is contemplated by the English statute of 7 and 8 Vict. 110, does not exist in Pennsylvania. The nearest approach in Pennsylvania to such a company is the partner- ship association created by the act of 2 June, 1874, which differs es- sentially (i. e. in the transferability of the shares) from the English company. The general opinion is that unincorporated joint-stock companies with transferable shares are illegal at common law. Mr. Lindley denies this. Lindley on Partnership, Ewell's 1st Am. Ed. 192, and notes. 1 2 UNINCORPORATED ASSOCIATIONS. essay. A club,^ a literary society,^ a beneficial associa- tion,' a church or charitable organization,'* are examples of such associations. It will be sufficiently accurate to define an unincorporated association, in the sense in which the term is used in this essay, as a union of indi- viduals, unincorporated, for a common purpose, not profit, and the relation of whose members to each other is either expressed by articles of association or implied from the nature of the union. § 2. Unincorporated associations are of very early ori- gin, but it is only within late years that they have been recognized by our courts of justice. By the civil law such associations constituted what were called tmiversitates or collegia, and the mere act and voluntary association of their members created a corporation ; provided, such con- vention was not contrary to law, for then it was illicitum collegium!' They were adopted also by the canon law, and from them our corporations are derived. Until a comparatively late date the English Courts would not recognize the existence of an unincorporated association. Lord Eldon was particularly opposed to them.^ They had no standing in court except as individuals.^ Sir AVilliam Blackstone speaks of their impotency thus: ' In re St. James Club, 2 DeG. M. & G. 383 ; Todd vs. Emley, 8 M. & W. 505. "" Ridgely vs. Dobson, 3 W. & S. 118. ^ Lowry vs. Reed, 3 Brewster, 452 ; Coram, vs. Volz, 14 W. N. C. 289. * Brown vs. Lutheran Church, 11 Harris, 459; Sutter vs. Dutch Church, 6 Wright, 503 ; Unangst vs. Shortz, 5 "Wharton, 506. * 1 Bl. Com. 469-472. ® Lord Eldon's decisions in Beaumont vs. Meredith, 2 Ves. & Bea. 180; Lloyd vs. Loaring, 6 Ves. 773; Pearce vs. Piper, 17 Id. 1; Cockburn vs. Thompson, 16 Id. 321 ; Lindley on Partnership, Ewell's 1st Am. ed. 193. ' Lloyd vs. Loaring, 6 Ves. 773. UNINCORPORATED ASSOCIATIONS. 3 " Let US consider the case of a college in either of our universities, founded ad studentnm et ormuhim, for the encouragement and support of religion and learning. If this were a mere voluntary assembly, the individuals which compose it might indeed read, pray, study, and perform scholastic exercises together, so long as they could agree to do so ; but they could neither frame nor receive any laws or rules of their conduct, none at least which would have any binding force, for want of a coercive power to create a sufficient obligation."' But in modern times the popularity of and almost ne- cessity for such organizations, have forced the courts and legislatures to take notice of them. In former times- the chief incentive to the association of individuals was reli- gion, but as all bishops, parsons, vicars, church-wardens, and some others have even been held by common law to have been corporations, virtute officii, the necessity for unincorporated associations was greatly lessened. At the settlement of this country, the simplicity which marked the lives of our forefathers enabled them to do without many institutions that in the present state of society are absolutely indispensable. Corporations were almost unknown.^ Unincorporated associations became a ne- cessity. The departure from the English Church system, the introduction of a new political system, and the de- velopment of the country, gave rise to and favored the rapid growth of religious, political, and social societies. § 3. From the beginning unincorporated religious so- cieties were the objects of care to Pennsylvania legislators. After long and bitter controversy, a law was twice passed ^ Blackstone's Commentaries, 467, 468. ^ Witman vs. Lex, 17 S. & R. 91. The history of the Society of Quakers presents no instance of a corporation, Magill vs. Brown, Brightly's N. P. Reports, 366. 4 UNINCORPORATED ASSOCIATIONS. (1712 and 1715) by the Assembly of Pennsylvania, and twice repealed by the Crown, entitled : " An act empower- ing religious societies to buy, hold, and enjoy lands, tene- ments, and hereditaments."^ A favorable opportunity again presented itself, and the religious society bill (much modified) was finally adopted in January, 1731. Other privileges and rights were expressly reserved and protected by the Constitutions of 1776, 1790, and 1838.^ Religious associations have always been recognized in Pennsylvania, and since the act of 1731, have had power to hold land, and to acquire rights by contract.^ The Constitution of 1776 declared that "societies for the ad- vancement of learning or religion, or for other pious and charitable purposes, shall be encouraged and protected in the enjoyment of the privileges, immunities, and estates which they were accustomed to enjoy and could of right have enjoyed under the laws and former Constitution of this State.'" The act of 17th Feb. 1818, recognized such associa- tions.^ The act of 2d August, 1842, contained provisions similar to those of the act of 1731. The act of 26th April, 1855, limited the amount of property which unincorpo- rated associations for literary, religious, and charitable ' Bradford's Ed. of the Laws, 160. See H. Binney's argument in Girard Will Case. " Magill vs. Brown, Brightly's N. P. Reports, 346-353 ; Unangst vs. Shortz, 5 "Wharton, 506-519. * Phipps vs. Jones, 8 Harris, 263, J. Lowrie's opinion. * Sec. 45, 5 Smith's Laws, 430. * That it applies to unincorporated societies, see Witman vs. Lex, 17 S. «fe R. 88; Unangst vs. Shortz, 5 Wharton, 506; Presby. Congre- gation vs. Johnson, 1 W. & S. 25; App vs. Luth. Cong. 6 Pa. St. 201 ; Trustees vs. Sturgeon, 9 Id. 321; Henry vs. Deitrich, 84 Id. 286; Ramsey's App., 88 Id. 60 ; Skilton vs. Webster, Brightly, 203 ; Means vs. Presby. Cong., 3 W. & S. 303. UNINCORPORATED ASSOCIATIONS. 5 purposes could hold. The act of 28th April, 1876, limi- ted the liability of the members of unincorporated bene- ficial societies, and the act of 2()th June, 1883, provided for the disposition of their property upon their dissolution under certain circumstances. The great act which recognized the authority of courts of equity over unincorporated associations was the act of 15th June, 1836, sec. 13. It declared that the several courts of common pleas shall have the jurisdiction and powers of a court of chancery, so far as relates to "the supervision and control of all corporations other than those of a municipal character, and unincorporated socie- ties or associations, and partnerships." But it is not to this statute that the chancery jurisdiction over unincor- porated associations is to be wholly attributed. Asso- ciations for charitable uses had been already recognized.^ In 1833 Judge Baldwin, sitting in equity, declared that "to deny to bodies united without a charter any rights of property which could be enjoyed by a corporate body would be in direct opposition to both the Constitu- tion of the State and Union, and the custom of the Province."^ § 4. Although the legislative enactments in Pennsyl- vania upon this subject have been numerous, the growth of unincorporated associations is not clearly defined by statutes. These enactments have been for the most part only declaratory of rights or remedies which had previ- ously been determined by judicial decisions. The courts at first refused to recognize unincorporated 1 Witman vs. Lex, 17 S. & R. 88; Magill vs. Brown, Bright. N. P. Rep. 346-353. Contra in Baptist Ass. vs. Hart's Ex'rs, 4 Wlieat. 28; Ingles vs. Trustees, 3 Pet. 114. ^ Magill vs. Brown, Bright. N. P. Rep. 366. 6 UNINCORPORATED ASSOCIATIONS. associations. They could only obtain a legal standing as partnerships. Religious and charitable associations were the first to obtain recognition, then literary, and finally all associations not contrary to the law of the land were recognized by the courts. Thus gradually did these asso- ciations secure a foothold, until, at the present time, their standing is firmly established. The rights of members of unincorporated associations are as sacred as any other rii^-hts. UNINCORPORATED ASSOCIATIONS. CHAPTER II. THE STATUS OF UNINCORPORATED ASSOCIATIONS. § 5. The rules governing unincorporated associations have been determined largely by judicial decisions. This judicial as distinguished from a legislative method is per- haps the surer method of establishing just and good laws; but it is necessarily a gradual method, and the development of laws from judicial decisions is not always constant. It is from these judicial decisions that the status of un- incorporated associations is to be determined. What rules of law govern questions concerning them 1 Are such questions decided upon the laws of corporations, of part- nerships, of principal and agent, of tenants in common, or have they a set of rules applicable to themselves ? In some cases the laws of partnership apply, in some the rules of tenancy in common, in others corporation law is recognized, and in a great many cases those laws which regulate the relation between principal and agent are ap- phcable, but none of them will apply in all cases. The rules governing unincorporated associations are composed of principles taken from all of these and adapted to the particular circumstances of such cases. They are not dif- ferent from the general body of our laws, but they are an application of the principles of those laws to a particular set of cases, and as such the decisions have acquired a similarity which entitles them to a separate consideration. § 6. The chief bone of contention in fixing the status 8 UNINCORPORATED ASSOCIATIONS. of these associations is whether they are to be treated as partnerships or not. What is a partnership 1 Many defi- nitions of a partnership have been given, and all contain the essential ideas of " trade and profit." Mr. Lindley, after examining a great many definitions of the term, con- cludes: "An agreement that something shall be attempted with a view to gain, and that the gain shall be shared by the parties to the agreement is the leading feature of every definition of the term."^ An association which is unin- corporated may be for trade and profit, and if it is, it is a partnership ; but an unincorporated association, such as is contemplated in this essay, is not for trade and profit, and we conceive that it should not be treated as a part- nership. The members of an unincorporated association have by their articles of association entered into a contract among themselves and delegated to each other certain powers. These powers and the relations of the members are founded upon the principles of agency. The only con- nection between the laws of partnerships and the laws governing unincorporated associations is, that both are primarily derived from the law of agency.^ The import- ance of this distinction is evident when we consider the manner in which the individual liability of members is determined. If liabilities are to be fastened upon the members of an unincorporated association, it must be by reason of the acts of those members themselves,^ or by reason of the acts of their agent, and no agency is implied ' Lindley on Partnership, Ewell's 2d Am. ed. 1. * Beckham vs. Drake, 9 M. & W. 98, opinion by Parke, B. They are both branches of the law of agency. Lord "Wensleydale and Lord Cranworth in Cox vs. Hickman, 8 H. L. C. 260. ' Cross vs. Williams, 7 H. & N. 675 ; 2 Kent Com. 630 ; Eichbaum vs. Irons, 6 W. & S. 07. UNINCORPORATED ASSOCIATIONS. 9 from the mere fact of association ;^ but if an association of individuals becomes a partnership, a very extended agency is implied from this fact. § 7. Before considering this question more fully let us look at a point which has caused some confusion. In the course of the growth or change in the legal standing of unincorporated associations a line was drawn between charitable associations and partnerships. Those unincor- porated associations which were not charitable could only obtain legal standing as partnerships. Although the general tone of our modern decisions has done away with this idea, we find it running through several of our later Pennsylvania cases. A distinction exists between unincorporated associations for charitable uses and those not for such uses, and it is of much im- portance. Upon it depend many questions which arise under the head of charitable uses, but it is of no import- ance in determining whether an association is a partner- ship or not. The distinction is not peculiar to unincorpo- rated associations. They are only a part of a larger class to which it applies. Associations not charities, and merely for private ad- vantage, may or may not be partnerships. If the associa- tion is for profit, it is a partnership ; if it is for pleasure or any object not profit, it is not a partnership. A chari- table association cannot well have business for a means and profit for an end, and therefore cannot well be a partnership, but the line which cuts out partnerships from unincorporated associations leaves not only chari- table but many other associations. § 8. A distinction may exist between the status of an association considered with reference to its members, and ' Lindley on Partnership, Ewell's 2d Am. ed. 50, and notes. 1 UNINCORPORATED ASSOCIATIONS. its status considered with reference to persons not mem- bers. As between the members the articles of association and tlie purposes of the union are the criteria by which the character of the association is to be determined, but as to third parties this may be modified by acts of the members which would justly lead others to suppose that their relationship is different from that which actually exists. So that although the members may as between themselves be only members of an unincorporated asso- ciation, they may by their acts so hold themselves out to other parties as to be partners with reference to those parties.^ But too much importance must not be placed upon this distinction. In many cases this difference has been mentioned where the distinction was merely verbal. Unless the members so act as to justify others in believing that a different relationship exists from that established by the agreement of the members, that agreement will determine the relationship as well to third persons as between themselves. § 9. Although the English decisions are not of binding authority with us, they are of great weight ; and this is especially true in considering a subject which, like unin- corporated associations, has been so little modified by statute, and the cases concerning which, owing to the comparatively recent importance of the subject,'' have left untouched many important branches of it. In England these cases have been more numerous, and have been considered with a care which deserves our attention, especially in considering any point which has not been determined in this country. The three principal English cases upon the subject of ' Waugh vs. Carver, 2 H. Bl. 235 ; 1 Smith's Lead. Ca. 131G, Hare & Wallace's ed. UNINCORPORATED ASSOCTATIONS. 11 unincorporated social organizations were Flemyng vs. Hector,^ Todd vs. Emley,^ and Iji re St. James Club.^ The first two considered the relation of the associations to third persons, and the last, of the members of the asso- ciation inter se. In Flemyng vs. Hector (1836), the defendants were members of the Westminster Reform Club, an unincorpo- rated social club, and the plaintiffs were merchants who had furnished provisions and material for the use of the club on the order of a committee appointed "to manage the affairs of the club." The action was brought to col- lect the amount of the plaintiffs' bill. The Court decided that the defendants were not liable. It was held : — I. That the club was not a partnership, and that the case stood on the ground of principal and agent. II. That the authority of the committee to bind the members depended upon the constitution of the club, which was to be found in its own rules. III. That in this case it could not be inferred, from these rules that they intended the committee to deal upon credit, and therefore the defendants were not bound. As to whether this was a partnership or not. Lord Abinger, C. B., said: "I had thought, but without much consideration, at the assize, that this sort of institutions were of such a nature as to come under the same view as a partnership, and that the same incidents might be ex- tended to them ; that where there was a body of gentle- men forming a club and meeting together for one common object, what one did, in respect to the society, bound the others, if he had been requested and had con- ^ 2 M. «fe W. 171. Adams vs. O'Brien, and Adams vs. Rippon were similar cases tried at the same time. 2 8 M. & W. 505. ' 2 DeG. M. «fc G. 383. 12 UNINCORPORATED ASSOCIATIONS. sentcd to act for them. Several cases have been cited in the course of the argument which do not apply, with the exception of one of them, to societies of this nature. Trade associations stand on a very different footing. When persons engage in a community of profit and loss, a partnership, one partner has the right of property for the whole ; so any partner has a right in any ordinary transaction, unless the contrary be clearly shown, to bind the partnership by a credit ; he might accept a bill of ex- change in the name of the firm, and as between the firm and strangers, the partnership would be bound, although, there might be an understanding in the firm that he was not to accept. It appears to me that this case must stand upon the ground on which the defendant put it, as a case between principal and agent." Barons Parke and Gurney agreed with the view expressed by Lord Abinger. Todd vs. Emley (1841)^ was a very important case, and was tried three times. It was an action of assumpsit brought to recover the price of wine supplied by the plaintiff's to the Alliance Club (an unincorporated social organization) during the time the defendants were mem- bers of the committee of the club. A verdict was twice set aside because the liability of the defendants was estab- lished upon the principles of partnership. One member could not, by dealing upon credit, bind the others.^ C. J. Tindal, before whom the case was finally tried, clearly distinguished it. from a partnership. In re St. James Club (1852)^ arose upon an appeal ^ Law Journal, vol. 10, Exch. Jan. 19th, 1841, page 161 (first argument), and May 25tli, 1841, page 2G2 (second argument) ; 8 M. & AY, 505 (last argument). ^ Opinions of Abinger, C. B., and Barons Parke and Alderson. Law Journal, vol. 10, Exch. Jan. 19th, 1841, page 161. » 2 DeG. M. & G. 383. UNINCORPORATED ASSOCIATIONS. 13 of a member of the St. James Club from an order of the Vice-Chancellor, made on the petition of several mem- bers, that the club should be wound up under the acts of 1848-1849 for the winding up of partnerships, and it was decided that this club was not within the acts. Said Lord Chancellor St. Leonards : " Bearing in mind that the individuals who form a club do not constitute a part- nership, nor incur liability as such, I think associations of that nature are not within the winding-up acts." § 10. A distinction has been drawn in some of the cases between beneficial associations and other unincorpo- rated associations. Beneficial associations are such as contemplate the granting of benefits or assistance to such persons only who may have been members of and con- tributors to the funds of the aggregate body.^ One of the chief points in dispute in determining the status of these associations is whether beneficial associa- tions are to be considered as partnerships, or are to be classed with unincorporated associations. In some cases these associations have been looked upon as in the nature of associations for profit, and hence, as partnerships. The object of beneficial associations is to insure the members against want, to prevent loss, and the prevention of loss was regarded as in the nature of profit. On the other hand, the better decisions, and those which the American cases follow, consider profit as something more than pro- tection. It is positive gain. According to this view, pure beneficial societies, unconnected with any purposes of trade or profit, are to be placed in the same category with other unincorporated associations. We will consider this question at some length, both because of its intrinsic importance, and because it will aff'ord a convenient oppor- ^ Wordsworth on Joint Slock Companies, ch. iv., page 154. 14 UNINCORPORATED ASSOCIATIONS. tunity of examining some of the characteristics of unin- corporated associations. Lord Eldon refused to consider beneficial associations except as partnerships. One of the earliest cases was that of Lloyd vs. Loaring (1802).^ A bill was filed by Lloyd and others in behalf of the Caledonian Lodge of Free Masons, of which they were members, against the defendants, also members of the lodge, praying that the defendants be decreed to deliver up certain articles. Lord Eldon refused to hear the bill, because he would not take notice of the plaintiffs as a society, but allowed them to amend and sue as individuals. Said he : "I am alarmed at the notion that these voluntary societies are to be per- mitted to state all their laws, forms, and constitutions upon the record, and then tell the Court they are indi- viduals. ... I desire to be understood distinctly. I do not think the Court ought to permit persons who can only sue as partners to sue in a corporate character, and that is the effect of this bill." Nothing could better illustrate the different views taken of unincorporated associations in Lord Eldon's day and our day. At the present day, these societies are allowed to state their laws, forms, and constitutions on the record, and they are the chief evi- dence upon which the case is decided. Bills are repeatedly brought in the form forbidden in that case. Beaumont vs. Meredith (1814)^ is the case usually cited in support of this docrine. A bill was filed by some members of a society called " The Beneficial Union So- ciety," an unincorporated association for the relief of its members in the case of sickness and for other beneficial purposes, against seven members of the same society, pray- ing an account and injunction. The bill was dismissed ' 6 Ves. 773. ' 3 Ves. & Beames, 321. UNINCORPORATED ASSOCIATIONS. 15 because of the nonjoinder of the proper parties defendant. Lord Eldon said : " This society can be considered in this Court only as a partnership, and neither has or can have a corporate character."^ The point which seems to have been brought to the attention of the Court in tliis case and in Lloyd vs. Loaring was whether the association had a corporate capacity or not. As between a corporation and a partnership such a society undoubtedly more re- sembles a partnership. Lord Eldon expressed the same opinion concerning unincorporated beneficial associations in a number of cases.^ § 11. The later English cases have however departed from this view, and are disposed to regard the status of such associations as depending upon the principles and purposes of their organization. If they do not contem- plate trade and profit, they are not partnerships. Nor will the mere acquisition of property or even of profit, if it be only an incident to the promotion of their real purpose, change their character. In Strong vs. Harvey (1825)^ an action brought by a ' It may be material to notice the observation made at the foot of the report of the case: " The Lord Chancellor refused to give costs, and observed that he did not allude to friendly societies in general ; but the objects of these societies are of a nature that no Court of Jus- tice could execute." At the present day our courts continually take cognizance of such societies, and see to the execution of their objects. * In Cockburn vs. Thompson, 16 Vesey, 321, the Philanthropic Annuity Institution was spoken of as a partnership. Pierce vs. Piper, 17 Vesey, 1; Reeve vs. Parkins, 2 J. & W. 390; and Buckley r^. Carter, 17 Vesey, 15, were cases of similar societies, and, although the point did not arise in the case, they were afterwards alluded to by Lord Eldon as cases of partnership. In Ellison vs. Bignold, 2 J. & W. 503, the same Chancellor said that the National Union Fire Asso- ciation must be looked upon as a general partnership. » 11 Eng. Com. Law, 3 Bing. 303. 16 UNINCORPORATED ASSOCIATIONS. member of an unincorporated association of ship-owners, for the mutual insurance of each other's ships, against another member to recover his proportion of a loss was sustained. Of the nature of this association Burroughs, J., said : " This association does not constitute a partner- ship, because there is no joint profit and loss to be divided among the members." In re London Marine Insurance Company (1869)^ was the case of an unincorporated mutual insurance com- pany. Upon winding up the association, claims were presented against it both by members and persons not members. The nature of the association was very fully discussed, and neither in respect to the members them- selves, nor to third persons, was it considered a partner- ship. Sir William James, V. C, said that there was no common liability among the members, and, as to third per- sons, the members stood in the same position as if they had been members of a club. In Caldicott vs. Griffiths et al (1853/ the Midland Counties Guardian Society for the Protection of Trade, an unincorporated association whose object was to watch the progress of any measure in Parliament affecting the trade interests, and to protect its members from the practices of the fraudulent and dishonest, was declared not to be a partnership. One of the members brought a suit for ser- vices rendered, and it was objected by the defendants that the society was a partnership, and that the action could not lie ; that the only method was to file a bill for an account and settlement of the affairs of the firm; but the Court held that the action was properly brought;. Said Martin, B. : " It is an abuse of language to call such an association a partnership," » L. R. 8 Eq. 176. « 8 Ex. 207. UNINCORPORATED ASSOCIATIONS. 17 So rlso the members of a provisional committee of an i7itend^d railway company have been held not to be part- ners. The term committee usually signifies a body of indivicuals to which others have committed or delegated a particular duty, or who have taken upon themselves to perforn it in expectation of their act being confirmed by the body they propose to represent or act for.^ In Reg- nell vs. Le\^'\-> (1846)^ an action of debt was brought against a m r- .,;r of a provisional committee of the Cen- tral Kent Railway Company. Pollock, C. B., said: "Such an intended association constitutes no agreement to share in profit or loss, which is the character of a partnership." These cases represent the general course of decisions in the English courts. Although the development of their legal standing has not always been constant, it has in the main kept pace with their growth in society; and, although in the decisions of the present day traces of the earlier ideas are sometimes found, the weight of the Eng- lish authorities'; and certainly the weight of reason, is in favor of awarding to them a standing in their own right and independent of any idea of a partnership.^ § 12. When we look at the Pennsylvania cases we find the same general features which mark the English cases ; first, that societies of a charitable or religious nature have 1 15 M. & W. 517. * In Queen vs. Waite, 2 Cox Cr. Cas. 245, an indictment against a member of the University Club, a social organization, for embezzle- ment of funds of the society, was not sustained by Lord Coleridge, be- cause he regarded the club as a partnership. In Queen vs. Robinson, 16 Q. B. 137, when a similar question arose, an association called the Christian Union was declared not to be a partnership. Iti re St. George's Building Society, 4 Drewry, 154; Delauney vs. Strickland, 3 Eng. Com. Law, 2 Starkie, 416; CuUen vs. Duke of Queensbury, 1 Bro. Ch. Cas. 101 ; Redway vs. Sweeting, L. R. 2 Ex. 400 ; Gray vs. Pearse, L. R. 5 C; Alexander vs. Alexander, L. R. 8 Eq. 17G. 2 18 UNINCORPORATED ASSOCIATIONS. always been recognized independently of any idea of part- nership ; second, that there has been some uncertairty in the decisions in reference to associations for social or beneficial purposes ; and third, that the weight of the authorities has been to award such associations a status independent of partnerships. The first of these pioposi- tions is so well established that it has seldom been doubted or even alluded to.^ In a recent case, Maguire's Est.,^ which arose upon exceptions to the adjudicp.tion of the account of the administrator, the auditing Judge (Hanna, P. J.. O. C. of Philadelphia) disallowed a claim presented bv the St, Rose Dorcas Society, an unincorporated chari- table association, because it was not properly presented. *'The society," said Judge Hanna, "being unincorporated, is in law a partnership." This was overruled by the Court in banc. Ashman, J., in delivering the opinion of the Court, said : " The first reason must be discarded. At the very basis of the definition of partnerships lies the idea of profit and loss, and that idea is excluded by the constitution of the society in question." So that the only difference of opinion has arisen in cases of associations for the private benefit of the mem- bers. One of the clearest cases upon this subject is that of Ash vs. Guie (1881).^ It was an action of asfmmpsit against the Williamson Lodge of Ancient York Masons, an unincorporated beneficial and social association, for money lent by the plaintiff. Recovery was allowed on the ground that the members of the lodge were partners. P. 508 V Harvey vs. Beckwith, 4 N. R. 90 and 254; Gaff vs. Evans, 82 B. 373; Bromley vs. Williams, 32 Beav. 177; Lees vs. Smith, 1 Term R. 338 ; Harrison vs. Millar, 1 Term R. 341. ^ Thomas vs. Elmaker, 1 Parsons' Eq. Cases, 98, 2d ed. note. * 7 W. N. C. 214; 39 Am. Rep. 818; 10 Am. Law Reg. 278. " 1 Out. 4»3. UNINCORPORATED ASSOCIATION'S. 19 This judgment was reversed by the Supreme Court, and Justice Trunkey, who delivered the opinion, said : " A mutual beneficial society partakes more of the char- acter of a club than of a trading association We are of the opinion that it was error to rule that all the members were liable as partners in their relation to third persons in the same manner as individuals associated for the purpose of carrying on a trade." A similar opinion was expressed in Leech vs. Harris (1869),^ where the question arose between the members of the Philadelphia Board of Brokers, a voluntary association of persons for purposes of convenience in the transaction of business ; one of the members filed a bill in equity against the committee and members of the board, praying a decree that the plaintiff be entitled to membership in the board, an injunction, etc. Pierce, J., in continuing the special injunction, said : " The Philadelphia Board of Brokers is not a corporation. It is not a joint-stock com- pany in the sense in which companies are regarded by the English law, although it has a large amount of pro- perty which belongs to it in its joint or aggregate ca- pacity ; such private associations are said not to be partnerships as between themselves, whatever may be their relations to third persons." The agreement which the members made among themselves was held to deter- mine the rights of the parties.^ In Scriber vs. Kapp^ the nature of the Harmony So- ciety, a society of Socialists, in which each of the mem- bers contributed all his property and labor to a common stock and received from it his living, came before the Su- ^ 2 Brewster, 571. ^ White vs. Brownell, 3 Abbot's Practice Rep. N. S. 318. ^ 5 Watts, 351-360. 20 UNINCORPORATED ASSOCIATIONS. preme Court, upon an action of account-render brought by the administrator of a deceased member of the associa- tion. C. J. Gibson said : " That it is not a partnership resuks from the fact that the profits are not shared in severalty." Commonwealth vs. YoW was an indictment for em- bezzlement of the funds of the Independent Order of the Sons of Progress, a beneficial association of which the de- fendant was a member. The defence was that the lodge, being unincorporated, was a quasi partnership, and the defendant, being a member, could not be held for the embezzlement of property in the ownership of which he was a partner. The Court (J. Arnold) said : " It is a strain upon the law to hold him to be entitled as a part- ner to retain the money received and drive the association to a bill for an account. The country is full of these associations, doing much good among the working peo- ple, and it is essential that the relief they afford should come promptly, and not be delayed by suits as between partners."^ The status of a committee appointed at a political meeting has been decided not to be that of a partner- ship. In Eichbaum vs. Irons (1843),^ a tavern-keeper brought an action of assumpsit against the members of a committee appointed by a political meeting to provide a free dinner, for the price of the dinner. The case was decided upon the ordinary law of contracts. Chief Justice 1 14 AV. N. C. 289. * Queen vs. Robson, 16 Q. B. D. 137; Regina vs. Murphy, 4 Cox Cr. 251; Regina vs. Wooley, 4 Cox Cr. Cas. 251; Rex vs. Hall, 1 Moody Eng. Cr. Cases, 474; contra Queen vs. AVhite, 2 Cox Cr. Cas. 245. ^ 6 W. & S. 67 ; Richmond vs. Judy, 6 Mo. App. 465 ; Burt vs. Lathrop, 52 Mich. 106. UNINCORPORATED ASSOCIATIONS. 21 Gibson said : " But the question would not depend upon the law of partnership, even were such a meeting to be treated as a club." One of the most recent cases, and one which clearly illustrates the doctrine that the Courts will take notice of associations for the private advantage of members merely in their character as unincorporated associations, is that of the Metropolitan Base Ball Club vs. Simmons (1885).' Both plaintiff and defendant were members of the American Association of Base Ball Clubs, the purpose of which was to afford the clubs composing the association the opportunity and right to play base-ball together. The association, like the Philadelphia Board of Stock Brokers, did not contemplate profit for itself from these games, although it afforded an opportunity for its members to make large profits. Upon a bill being filed by one of the clubs to determine its rights as a member, the nature of the association was considered by the Court. Thayer, P. J. (C. P. No. 4, of Philadelphia) said : " But it is inaccurate to say that it is a mere partnership. If there is any such a thing as an unincorporated society or association within the meaning of the act of 1836, this is certainly one of those unincorporated societies or asso- ciations. It has all the organic parts of an associated body. It has a written constitution. Now, membership of such an association after it has been acquired in pursu- ance of the constitution is a matter which is in itself legal property, even in a mere voluntary beneficial association." § 13. These cases show the prevailing and, we believe, the correct legal standing of unincorporated associations, and yet there have been several cases in which the reason- ing has been inconsistent with this doctrine, and they are of 1 17 W. N. C. 153. 22 UNINCORPORATED ASSOCIATIONS. SO high authority as to require that the opinions expressed in them be given the utmost consideration, and that our theories of the rights of members be so shaped, if possible, as to uphold their views. Of these the most important cases are Babb i%s. Reed (1835),^ decided by the Supreme Court (opinion by Justice Sergeant), and Pritchett vs. Sheafer,^ decided by the Court of Common Pleas No. 1, of Philadelphia (opin- ion by Allison, P. J.). The former decided that an un- incorporated association, which was not a charitable use, was a partnership as to third persons ; and the latter that such an association was a partnership, as to the members themselves. In neither case were these the direct point in dispute, but in each case the point was first decided and then, arguing from it, the Court decided the principal point. The conclusions in these cases are undoubtedly correct, but those parts of the reasoning which assume the relation of partnership cannot be accepted without rejecting the opin- ions of more numerous and equally competent authorities. Let us consider Babb vs. Reed. Reed and others were trustees for an unincorporated beneficial society called The Independent Order of Odd Fellows, for whom they held property which was sold by scire facias sur mort- gage. Claims of material men upon the surplus fund were made and among the claimants were several members of the association. A pro rata distribution was awarded from which an appeal was taken by those claimants who were not members of the association. The points decided were : — I. That this association being for purposes of mutual ' 5 Rawle, lol. 2 Reported in 11 Phila. IGG, 33 Leg. Int. 12, and 2 W. N. C. 317. The facts of the case are given more fully in 2 W. N. C. 317, and the opinion in 11 Phila. 166. UNINCORPORATED ASSOCIATIONS. 23 benevolence among its members only is not an association for charitable iises.^ II. That its members are considered as partners in their relation to third persons. III. That the property of the association must be ap- portioned to pay the debts of creditors, not members of the association, before it can be applied to the payment of the claims of those who are members. This is a leading case as far as the first of these propo- sitions is concerned and the third proposition is cited with approval in a number of subsequent cases, but the second proposition has never been followed. Nor is it a neces- sary link in the chain of reasoning by which the third proposition is attained. Starting with the members of the association as joint-owners of this property and applying the same reasoning to them as was applied to them as partners we come to the same conclusion. It is possible that persons jointly owning lots of ground and erecting buildings upon them to which they furnish work and ma- terials, may obtain liens imder the Acts of Assembly and maintain them among themselves on the ground that they are in equali jure, and to be considered as mutually waiv- ing objections. But neither at law nor in equity will these be good against third persons who hold similar liens. At law the liens of the owner would be merged in the pro- perty since no man can be both debtor and creditor, and equity would not uphold it in order to place in the hands of the owner a portion of that fund which ought to go to his creditor whose debt was contracted on the faith of the loan. The liens of third persons would be entitled to priority of payment ; so that it is not necessary to con- sider such a society a partnership in order to uphold the 1 Blenon's Est., Bright. N. P. Rep. 338. 24 UNINCORPORATED ASSOCIATIONS. decision in this case. This view was taken by Judge Trunkey in the case of Ash vs. Guie,^ where the Su- preme Court decided that a lodge of Free Masons was not a partnership. The learned Judge commenting upon the reasoning in Babb vs. Reed says : " Had the members been called joint- tenants of the real estate tlie same prin- ciple in the distribution would have applied." The case of Pritchett vs. Shaefer^ presents the best possible exposition of the doctrine that an unincorporated association, not a charity, is a partnership. A close study of that case will show the errors of the doctrine there laid down, and will, perhaps, aid in determining the true status of such associations. A bill was filed by a member of the Chosen Friends Lodge No. 3, of the Knights of Pythias, an unincorporated beneficial associa- tion, against the officers and members of the same to re- cover certain weekly payments or "benefits" to which he claimed he became entitled under the constitution and by-laws of said association during a certain period of ill- ness. A Master was appointed who made an award in favor of the plaintiff, and upon the exceptions to this award the case came before the Court. Judge Allison, in his opinion, said : " The defendants are an unincorporated association, formed for purposes of mutual benefit and advantage. One of the principal objects of the organization, so far as appears upon the face of the articles of association, is the protection of each other by payments of money in case of sickness. This does not in strict legal sense constitute them an association for charitable uses, the benefits being exclu- sively confined to their own members. In Thomas vs. Elmaker, 1 Parsons, 98, Judge King discussed the ques- ' 1 Outerbridge, 493. * 11 PLila. 166. UNINCORPORATED ASSOCIATIONS. 25 tion of charitable uses, with the learning and ability for which he was so pre-eminent, holding that though the statute of 43 Elizabeth, in relation to charities, was not in force in Pennsylvania, yet a common law, analogous in its results to those of the statute, exists in this State, by which such subjects are placed under legal control and restraint. Cases which are constructively within the statute are of a public nature, tending to the relief of the public generally. On the otlicr hand, where the associa- tion is for private and individual profit or pleasure, with no public object, it is treated as a partnership. Judge King remarks the English Chancery reports are full of cases in which associations for private and individual pro- fit or pleasure have been looked upon in no other light than as partnerships. In support of this principle he cites the cases of Cullen vs. The Duke of Queensbury, 1 Bro. Ch. Ca. 101 ; Lloyd vs. Loaring, 6 Ves. 773; Pcarce vs. Piper, 17 Id. 1 ; Cockburn vs. Thompson, 16 Id. 321 ; Beaumont vs. Meredith, 2 Ves. & Bea. 180. In all of these cases Lord Eldon regards the parties only as part- ners. The same principle is recognized in Babb vs. Reed, 5 Rawle, 151. This was the case of an unincorporated lodge of Odd Fellows, to which was held applicable the principle that in the absence of an actual charter it is a voluntary association of individuals, and the members in their relation to third persons are to be considered as partners. Hess vs. Werts, 4 S. & 11. 356 ; Witmer vs. Schlatter, 2 R. 359 ; and Ridgely vs. Dobson, 3 W. & S. 118, support this principle. The Pennsylvania decisions are cases in which the members of unincorporated asso- ciations for private advantage were held to be partners, so as to make them liable for debts contracted with persons not members of the association, and to postpone claims of members of the organization to the claims of third parties. 26 UNINCORPORATED ASSOCIATIONS. But the general principle recognized in Thomas vs. Elnia- ker, and in the English cases cited above, which, though not binding authority with us, have yet the great weight of Lord Eldon's opinion to sustain them, that members of associations like that of the defendants, stand in their relations to each other, as well as to third parties, as partners, is not shaken by anything which is said in the Pennsylvania cases. We are to regard the members of this association as partners inter se. Contemplating no charitable purpose by the articles of their association, they are as much a private association as is any other combination of individuals and capital, for the exclusive advantage of the contributors." The doctrine here laid down may be summed up as follows : associations tending to the relief of the public generally are constructively within the English statute of charitable uses — that is, are charities. Associations for private and individual profit and pleasure are not within the statute, and therefore are treated as partnerships. Let us look at the cases which are cited as authority for this doctrine. The case mainly relied upon in the argument is Thomas vs. Elmaker.^ This was the case of a bill filed by certain members of the Phoenix Hose Company against certain other members, praying a disso- lution of the company and settlement of its affairs. The association was expressly declared to be a charity. Presi- dent Judge King of the Court of Common Pleas, before whom the case came, said : " From the course of reason- ing already adopted, in which our jurisdiction over these parties is asserted on the ground of the association being a charity or an unincorporated association, within the contemplation of the 13th section of the act of 1836, it follows that I do not regard these as between themselves, ^ 1 Pars. Eq. Cases, 98, 2d ed. note. UNINCORPORATED ASSOCIATIONS. 27 as partners."^ The association in Pritchett vs. Shaffer was declared to be not a charity, and the members to be partners, so that Thomas vs. El maker can hardly be an authority. The principle recognized in the English cases mentioned above was cited by Judge King only as an historical statement of the fact, and was neither affirmed nor disaffirmed as a present existing principle, except so far as to say that that case did not fall within that principle. The early English cases cited have already been con- sidered, and the doctrine upon which they were decided shown to be obsolete. All of them were decided by Lord Eldon, and prior to 1810.^ Of the modern decisions, embracing such cases as Flemyng vs. Hector,^ Todd vs. Emley,^ In re St. James Club,^ Strong ^.9. Harvey,® Li re London Marine Ins. Co.,^ Caldicott vs. Griffith,^ and many others no mention is made. Of the Pennsylvania cases cited, Babb vs. Peed^ has been considered. Hess vs. Werts^° was the case of the Farmers and Mechanics' Bank of Fayette County, an in- stitution for business purposes and profit, and bearing on its face the stamp of partnership. Witmer vs. Schlatter" was the case of the Philadelphia and Pittsburgh Trans- ^ Their relation to third persons was not considered. Said J. King : " I say as between tliemselves, for their relation to third persons is a dilFerent affair, one not before the Court, and upon which it is not requisite to pass judgment by anticipation." * In two of the cases cited, CuUen vs. Duke of Queensbury, 1 Bro. Ch. Ca. 101, and Pierce vs. Piper, 17 Vesey, 1, the question of partnership did not arise. s 2 M. & W. 171. * 8 M. & W. 505. ^ 2 DeG. M. & G. 383. * 1 1 Eng. Com. Law, 3 Bing. 303. ' L. R. 8 Eq. 176. 8 8 Ex. 897. » 5 Rawie, 151. >» 4 S. & R. 356. " 2 Rawle, 359. 28 UNINCORPORATED ASSOCIATIONS. portation Company, a company whose sole object was profit, and therefore a partnership. Ridgely vs. Dobson^ was the case of the Bristol Lyceum, an appropriate example, but it was decided upon the principle of agency. In answer to one of the defendants' points, the judge ex- pressly said : " Whether it was a partnership or not is immaterial." The incorrectness of the statement that " the general principle that members of associations, like that of the defendants, stand in their relation to each other, as well as to third parties, as partners, is not shaken by anything which is said in the Pennsylvania cases,"^ is shown by the cases of Ash vs. Guie,'^ Leech vs. Harris,^ Schriber vs. Rapp,' Commonwealth vs. Volz,^ Eich- baum vs. Irons,^ and the Metropolitan Base Ball Club vs. Simmons,^ all of which were unincorporated asso- ciations for the private benefit of the members, none of which contemplated any charity, and in all of which the Court distinctly declared that the members were not partners. The objection to the doctrine of Pritchett vs. Shaffer may be stated as follows : First, the English cases relied upon were very early cases whose doctrine has since been declared obsolete ; second, none of the modern English cases were considered ; third, none of the Pennsylvania cases cited were applicable, except one, and in that case the doctrine was not necessary to the decision ; and fourth, in a number of Pennsylvania cases in which exactly the same question arose under similar circumstances, it was expressly declared that the members were not partners. > 3 AV. & S. 118. ' Judge Allison's Opinion, 11 Phila. IGC. 5 1 Out. 4i)3. * 2 Brewster, .571. * Watts, 351. 8 14 W. N. C 289. ' G W. & S. 67. 8 17 W. N. C. 153. UNINCORPORATED ASSOCIATIONS. 29 From Babb vs. Reed (1835), in which the doctrine (that unincorporated associations which are not charities are to be considered as partnerships) was first declared, to Pritchett vs. Shaffer, we have been unable to find any instance in which it was followed, and subsequent to that case there are two decisions in which it was mentioned with approval. One was Kurz vs. Eggert (1880),^ in which the question was precisely similar to that in Pritchett vs. Shaffer, except that it arose at law instead of in equity. It arose before the same judge, presented the same circumstances, and the same doctrine was de- clared. Meanwhile the act of 28th x\pril, 1876, limiting the liability of the members of unincorporated beneficial associations, had been passed, and Judge Allison decided that this act did not change the status of such associations. The case does not add anything to the former opinion. The other was Paul vs. The Keystone Lodge, eo nomine (1877)," in which a demurrer to the form of the action was sustained. Judge Ludlow (C. P. No. 3, Phila- delphia), in an oral opinion, said : " We concur in tlie opinion of Allison, P. J., in Pritchett vs. Shaffer." In both of these cases the opinion was oral, in both the report is very brief, and in neither was the point reviewed by the Supreme Court. Finally, the doctrine in Pritchett vs. Shaffer is not necessary to support the decision in that case. The learned judge argued as follows : — I. The association is assumed to be a partnership. II. Under their general obligation as partners the in- debtedness of the defendants to the plaintiff is a debt for which the members stand severally and jointly bound. III. The articles of association are to be considered 1 9 W. N. C. 126. * 3 W. N. C. 408. 30 UNINCORPORATED ASSOCIATIONS. in the light of an agreement between the members ex- tending or limiting any general obligation which binds them to each other as members of the partnership. IV. An examination of the laws of the order does not disclose any agreement by which they are relieved from such obligation. Therefore the defendants are liable under their general obligation as partners. This is a negative way of coming to the same con- clusion to which we may come by positive reasoning based upon the facts as they are stated in the opinion. Let us summarize these facts: First, the agreement was " A general stipulation for equal contribution by the members to the funds of the lodge, which contributions are to constitute a capital out of which, in the event of sickness, benefits are to be paid :"^ Second, the sickness for which the plaintiff claimed a benefit was decided to be such as was contemplated by the laws of the association: Third, the defendants did not attempt to show that the funds of the lodge raised in this manner were not suffi- cient to pay the just demand of the plaintiff.^ These facts being established; if we consider: — I. That this is an unincorporated association. II. That the members are bound by the articles of association. III. That these articles contain an agreement by which the plaintiff, because of sickness, is entitled to benefits to be paid out of the funds of the lodge obtained by the equal contribution of the members of whom the defend- ants are a part. lY. That the sickness upon which the claim is made is such as is contemplated in these articles. * Judge Allison's Opinion, 11 Phila. p. 169. ' Ibid., p. 170. UNINCORPORATED ASSOCIATIONS. 31 V. That the defendants have not attempted to show that the funds of the lodji^e raised in this manner were not sufficient to pay the just demands of the plaintiff. We must conclude that the defendants are liable under the agreement made by them as members of an unincor- porated association. § 14, The result of all the authorities may be summed up thus : the English decisions at first included unincor- porated associations under the head of partnerships, and this idea is found running through a few of the later cases, but the great bulk of the English decisions, and especially the modern ones, have awarded to such asso- ciations an independent standing. The later English view has been adopted in Pennsylvania with a few excep- tions. These exceptions may be reduced to three, Rabb vs. Ileed,^ Pritchett vs. Shaffer,^ and a remark in Paul vs. The Keystone Lodge,^ and in none of these was the doctrine necessary to the decision. The weight of these opinions is far over-balanced by the direct decisions of such competent authority as Chief Justice Gibson and Justice Trunkey, of the Supreme Court, and Justices Thayer, Pierce, and Arnold of the Courts of Common Pleas. So that the conclusion we believe is justified that unincorporated associations possess a status in Pennsyl- vania, independent of the laws of partnership and founded upon an application to their cases of the laws of contract and of agency. 1 5 Rawle, 151. ' 11 Phila. IGG. * 3 AV. N. C. 408. 32 UNINCORPORATED ASSOCIATIONS. CHAPTER III. LIABILITY OF MEMBERS. § 15. The most important branch of this subject, and that under which most of the legal questions have arisen, is the liabiUty of the members of unincorporated associa- tions. This liability is of two kinds: first, where it arises from the acts of those members themselves who are sought to be charged, and in this case the same rules apply which ordinarily determine the liability of a man for his own acts:^ second, where it arises from the acts ol" other mem- bers of the association than those sought to be charged, and in this case the controlling principles are those which govern the relation of principal and agent. Liability under this head may be imposed either by the association acting as a body or by the individual acts of members. LiabiUty may also arise inter se or concerning third persons. But in whatever form it arises the same principles rule which would have ruled in a like case concerning principal and agent. § 16. The underlying principles of agency may be briefly stated as follows : A principal is responsible either where he has given to an agent sufficient authority, or where he justifies the party dealing with his agent in be- lieving that he has given to his agent this authority.^ An agent becomes personally liable only where the principal is not known, or where there is no responsible ' Elchbaum vs. Irons, 6 W. & S. G7. * Parsons on Contracts, page 44. UNINCORPORATED ASSOCIATIONS. 33 principal, or where the agent becomes liable by an under- taking in his own name, or where he exceeds his power.^ Nearly all questions which arise as to the liability of members of an unincorporated association maybe resolved by these principles or others growing out of them ; for in- stance, in Delauney vs. Strickland,^ the question was whether the agent had become liable by an undertaking in his own name ; in Eichbaum vs. Irons,'^ there was no responsible principal ; in Flemyng vs. Hector,^ the prin- cipal did not give the agent sufficient authority (so also Todd vs. Emley),'^ and so on through the whole list of cases. § 17. A glance at these principles will show that there is a distinction between the authority really vested in the agent and the authority apparently so vested ; and this gives rise to the distinction between the liability of the members of an unincorporated association intei' se, and as to third persons. Although by their agreement the mem- bers may confer only a very limited authority upon each other, yet they may so act as to lead others to believe that a very extended authority exists.*' An association or club usually acts through its members, and tradesmen are ac- customed to deal with a club through one or several of its members. What protection have persons who so deal with an association 1 In the first instance the tradesman relies upon the person with whom he deals. If he desires any further security, it is his business to determine by what authority that person acts. But the members of the association must remember that they have given to each "■ 2 Kent's Com. 630 ^ 2 Starkie, 41G ; 3 Eng. Com. Law, 47U. ^ 6 W. & S. 67. * 2 M. & W. 171. » 7 M. & W. 426. ^ Waugh vs. Carver, 2 H. Bl. 235; 1 Smith's Lead. Cases, 1316, Hare & Wallace's ed. 3 :U UNINCORPORATED ASSOCIATIONS. other certain powers, and they must be careful that their acts do not lead other parties to believe that they have jj^iven to each other more authority than they intended to give, for they are responsible not only for the authority which they intended to give, but also for the authority which they justly lead others to believe they have given. The chief evidence to which the principles of agency are to be applied will be found in the constitution and by- laws of the association. These are the contracts between the parties, and except under special circumstances rule the case.^ In Thompson vs. Adams,^ the Supreme Court decided that " the constitution and articles of association of a voluntary association such as the Philadelphia Board of Brokers, are a law as to its members." The liability of the members, supposing them to have done nothing to make themselves personally liable, depends ultimately upon the rules of the association. These rules are set forth at length upon tlie record of the case. In a case in which this was not done, and an unincorporated association " without proof of its constitution and the management of its affairs was held to be a common partnership," the judgment was reversed by the Supreme Court and a new trial ordered.'' § 18. Liability under the first head of the division which we made of the subject of this chapter, namely, arising from the actSs of those members themselves who are sought to be charged, may be either to individuals or * Every member is presumed to be acquainted with the rules of the association. Raggett vs. Musgrave, 2 C. & P. 556 ; 12 Eng. Com. Law, 730. * 7 W. N. C. 281. * Ash vs. Guie, 1 Out. 493; Flemyng vs. Hector, 2 M. & W. 171. See, also, opinion of Vice-Chan. Bacon, in Ljttleton vs. Blackburn, 45 L. T. Ch. 219-223. UNINCORPORATED ASSOCIATIONS. 35 to the association. Suits of the former kind are usually brought against a member in his individual capacity and do not involve any question concerning his membershi]> in the association. An instance under this head however arose in the case of Eichbaum vs. Irons,' already men- tioned, in which the members of a committee appointed by a political meeting were sued for the price of a dinner. It was a joint contract and the question to determine was how far each of the defendants by his own acts made himself a party to it. § 19. Liability to the association may be incurred for the payment of entrance money, dues, and other obliga- tions, entered into by the agreement of association"^ or in almost any way in which liability could be incurred to an individual. Mutual subscriptions may impose a lia- bility, and this liability will be enforced in favor of tlie association the same as if it were a contract with an individual. These suits frequently arise in the formation of an association. Persons sign a subscription paper agreeing to become members of and contributors to a contem- plated association. If the association is formed and the terms of the subscription complied with, the subscriptions may be enforced ; but frequently these terms are only partly complied with, and then it is a question how far the subscribers or members of the provisional committee are bound. In Edinboro' Academy vs. Robinson,'' ^^dlere persons subscribed to a fund lor the erection of an » 6 W. & S. 67. -' Raggett vs. Bishop (1826), 2 C. & P. 343; 12 Eng. Com. Law, »)07 ; Raggett vs. Musgrave (1827), 2 C. & P. 566; 12 Eng. Com. Law, 73(». ' 1 Wr. 210. After organization this association was incorporated, but before incorporation it was an appropriate example. 3() UNINCORPORATED ASSOCIATIONS. Academy and the subscription provided for organization, Lowrie, C. J., said that as soon as the subscription-paper became complete by the subscription of the stipulated amount of money, the subscribers to it became an asso- ciation of persons united for contributing to a common fund for a common purpose to be carried out by them- selves. The consideration in such a contract is the enter- ing into a similar contract by the other members. In Phipps vs. Jones,^ the circumstances were as fol- lows : Ellis Phipps (together with two hundred others) signed a paper agreeing to pay a certain sum for the pur- pose of building a house for public worship, with the understanding that when sufficient money was subscribed to justify the undertaking there should be a meeting of the subscribers and a building committee appointed. Before this general meeting of the contributors, he died, and suit was brought against his administrator to enforce the subscription. The Supreme Court, reversing the judgment of the lower Court, said that the death of the subscriber before the complete formation of the association revoked the subscription. The subscription-paper was itself the first step towards the formation of the association. The subscriptions were proposals which until their accept- ance by the formation of the association were revoked. If, however, the association had been formed in accordance with the terms of the subscription before the subscription had been revoked, it would have been a binding contract. This occurred in Chambers vs. Calhoun,'^ where a sub- scription similar to that in Phipps vs. Jones was made and the association carried to completion. An action by the members of the building committee to collect the 1 20 Pa. 260; Ryerss vs. Cong, of Blossburg, 9 Casey, 114. » 18 Pa. 13. UNINCORPORATED ASSOCIATIONS. 37 subscription was upheld. In all of these cases in which the member is sought to be charged for his own acts the ordinary laws of contracts prevail. § 20. Under the second head (where the liability arises from the acts of other members than those sought to be charged) most of the cases have arisen, and these are capable of two sub-divisions: first, where the liability is incurred through the association acting as a body ; and second, where it is incurred through the acts of individual members. An instructive example in Pennsylvania of the first of these is the case of Ash vs. Guie.^ It is especially valua- ble as a precedent because the association in that case possessed no peculiar features. The constitution and rules were not given in evidence, so that it left the question to be decided upon the general nature of such associations. The Williamson Lodge of Ancient York Masons, an un- incorporated beneficial and social association, desired to erect a building for lodge purposes. At a meeting of the lodge, the Master appointed a committee of five to select a lot, procure plans, etc., and the building was erected under the direction of this committee. The committee borrowed money and issued certificates therefor, signed by the officers of the lodge. The committee reported to the lodge from time to time, and its action was approved by the lodge. An action of assumpsit was brought against the members of the lodge upon one of these cer- tificates. The defendants claimed that the erection of the building was not within the scope of the objects of the lodge, and that, to charge the individual members of the lodge, it must be shown that they personally authorized or assented to the acts of the committee ; that the action 1 1 Out. 493. 38 UNINCORPORATED ASSOCIATIONS. of the lodge would only bind those members who participated in or assented to that action. The lower Court ordered judgment to be entered against all of the defendants, but upon a writ of error to the Supreme Court this judgment was reversed. Justice Trunkey, who delivered the opinion of the Court, said : " The ])roof fails to show that the officers, or a committee, or anv number of the members, had a right to contract debts for the building of a temple, which would be valid against everybody from the mere fact that he was a mem- ber of the lodge. But those who engaged in the enter- prise are liable for the debts they contracted, and all are included in such liability who assented to the undertak- ing, or subsequently ratified it. Those who participated in the erection of the building by voting or by advising it, are bound the same as the committee who had it in charge ; and so with reference to borrowing money. A member who subsequently approved the erection could be bound on the ground of ratification of the agent's acts." This case shows that the mere fact of association im- plies no liability. It was not shown that the acts were within the objects of the association ; and they were, there- fore, binding only on those who sanctioned them. It is incumbent upon him who seeks to impose the liability to show that the acts for which the liability is sought to be imposed were within the power of the association. § 21. A class of cases arises under this head where one member of a beneficial association is sought to be charged by another member with the payment of sick benefits. The case of Pritchett vs. Shaffer, which has been consid- ered at some length, was an instance of this. These cases will all be found to depend upon the principles of agency. And in these cases, more than in any other, the chief evi- UNINCORPORATED ASSOCIATIONS. 39 dence to which these principles are to be applied will be found in the constitution and by-laws of the association. In Pennsylvania the liability of the members of these associations is now regulated by statute. The act of 28th April, 1876, provides that the members of beneficial societies shall not be individually liable for the payments of benefits, and that the same shall be paid out of the treasury of such organizations. This act did not change the legal status of these associations, but only declared how the contract entered into by the members when they subscribed to the constitution should be interpreted, and in cases where individual liability might have been incur- red previous to that act, the remedy was limited to the funds of the association.^ § 22. The instances in which liability has been sought to be fastened upon one member for the acts of another have usually arisen through the medium of a committee. Societies usually appoint a committee to manage their affairs, and obligations are frequently incurred by a mem- ber or members of this committee which are souo:ht to be enforced either against other members of the committee or against members of the society at large. The status of a committee with relation to its members, to the members of the society at large, and to the public, is the most difficult to determine of all the questions concerning the liability of the members of an unincorporated association. The leading case upon this subject is Flemyng vs. Hector (1836).^ It was an action of assumpsit brought by Flemyng, a wine-merchant, against Hector, a member ^ Paul vs. Keystone Lodge, 3 W. N. C. 408 ; Kurz vs. Eggert, 9 W. N. C. 126. ' Flemyng vs. Hector, Adams vs. O'Brien, and Adams vs. Rippen, were tried at the same time and involved the same questions, 2 M. & W. 171. 40 UNINCORPORATED ASSOCIATIONS. of the Westminster Reform Club, for the price of wine furnished to the club during the period of its existence. The club was an ordinary social organization, governed by a constitution and by-laws. The important rules bear- ing upon this case were : Rule 6. " That each member on admission to the club should pay ten guineas, and the annual subscription, five guineas." Rule 19. "That there should be a committee to manage the affairs of the club, consisting of thirty members, to be chosen by vote at the general meeting of the club." Rule 28. " That all members be expected to discharge their club bills day by dav, the steward having orders not to open accounts with any individuals, and being authorized to refuse to continue to supply parties neglecting to pay what they may owe after payment is requested." The defendant frequented and dined at the club and was in the habit of ordering Flemyng's wine. There was no evidence to show that he authorized the purchase of the wine on credit. A verdict was directed to be entered for the plaintiff, with leave to the defendant to enter a rule for a non-suit. After argu- ment upon this rule a non-suit was ordered. Lord Ab- inger, C. B., delivered the principal opinion and Barons Parks, Alderson, and Gurnsey each delivered concurring opinions. Lord Abinger said that the authority of the committee to bind the members depends upon the consti- tution of the club which is to be found in its rules. Of these rules he said : " The words are ' to manage the af- fairs of the club,' the question then is what the affairs of the club are. They are to have in their hands a subscrip- tion, and they are to take care that every member pays it before he comes into the club, and pay for everything he has in the club. It therefore appears that the mem- bers in general intended to provide a fund for the com- mittee to call upon. I cannot infer that they intended UNINCORPORATED ASSOCIATIONS. 41 the committee to deal upon the credit and unless you infer that that was the intention, how are the defendants bound '?" Baron Parke said : " The inference sought to be drawn rests altogether on the ground of the committees not deal- ing in the way they ought to deal; but if that is to vary the authority given by the original rules, it should be shown affirmatively that the defendant did know and sanction it," One of the most famous cases upon this subject was the case of Todd vs. Emley (1841),^ which was exhaustively considered by the Court of Exchequer, before whom it was argued a number of times.^ It was an action of assumpsit brought to recover the price of wine supplied by the plain- tiffs to the Alliance Club during the time that the defend- ants were members of tlie committee of that club. The members on admission paid entrance money and an an- nual subscription, and all provisions consumed in the club were paid for in ready money. The club possessed a fund from which expenses were paid by check signed by cer- tain persons who were given authority to do so. The house steward, who was the agent of the committee for the purpose of ordering articles for the use of the club, ordered wine from the plaintiffs. He ordered by authority of the " members of the committee," and the committee were aware that the wine was obtained on credit. It did not appear whether " members of the committee" included all the members elected to the position, or only those who attended the committee meetings. The defendants had not ordered the wine personally nor was it shown that they were present at any particular meeting when authority 1 8 M. & W. 505. "^ See the reports in Law Journal, 10 vol. Exch. Jan. 19, 18il, page 161 ; and May 25, 1841, page 202 ; 7 M. & W. 426; 8 M. & yS\ 505. 42 UNINCORPORATED ASSOCIATIONS. to order it was given to the steward. The case was tried three times, and on each occasion a verdict was re- turned for the plaintiff. The first trial was set aside on the grounds that one member of a committee can only bind another for acts done in furtherance of the common purpose for which the committee was appointed, and in this case there was no common purpose of dealing on credit. Lord Abinger looked upon the defendants as trustees for the club, hav- ing no authority to deal on credit, so that one committee- man could not bind the others. The verdict in the second trial was set aside because the question of the individual liability of the defendants was not brought distinctly to the notice of the jury. Said Bar5n Alderson : " In order to make the case out and establish the liability of the de- fendants, the jury must be satisfied that what was done was not only within the knowledge of the committee generally, but that it was within the particular knowledge of the two defendants." The principle which governed this case is identical with that laid down in Flemyng vs. Hector. In the one case it was applied in determining the liability of a member of the association at large, and in the other of a member of the committee, and both of these cases are in harmony with the doctrine declared in Ash vs. Guie. In all of them it was held that the contracting body could only bind those whom it represented so far as they had con- ferred authority upon it. In Ash vs. Guie, the Court held that in the absence of the articles of association it could not be inferred from the nature of the association that it possessed the authority imputed to it ; and in Flemyng vs. Hector, and Todd vs. Emley, the Court held that the articles of association, having been given in UNINCORPORATED ASSOCIATIONS. 43 evidence, did not show that the authority had been conferred.^ § 23. A question frequently arises as to whether a com- mittee is empowered to deal on credit. In both of the cases last mentioned provisions were made for a club fund and then a committee was appointed to manage the affairs of the club, and the Court said that the committee must confine its expenditures to the fund provided. Where a fund is expressly provided or set aside for the use of the committee, it is restricted to that fund, but when no such fund is given for its use, the authority to deal on credit may be implied. This is illustrated by two cases in which the distinction is very closely drawn, and in one of which the authority to deal on credit was held to exist and in the other not to exist. In Cockerell vs. Aucompte,^ the members of a coal club, having provided a general fund, authorized an agent to order coals for them. The agent bought coals on credit and the members were held liable for the payment. On the other hand, in Wood vs. Finch,^ where a coal club provided a fund and placed it in the hands of an agent and gave him authority to purchase, the members were held not to be liable for purchases made on credit. In this case a specific fund was provided and no inference could therefore be drawn that the agent had authority to go beyond that fund. § 24. The result of these cases may be stated, as fol- lows : Liability must always be proved affirmatively. It ' Delauney vs. Strickland, 2 Stark. N. P. C. 416, 3 Eng. Com. Law ; Cullen vs. Duke of Queensbury (1775), Bro. Ch. Ca. 101 ; Burls vs. Smith (1829), 7 Bing. 705, 20 Eng. Com. Law ; In re St. James Club, 2 De G. M. & G. See Lord Chancellor St. Leonards' opinion. ' 2 C. B., N. S. 440, 89 Eng. Com. Law. » 2 F. & F. 447. 44 UNINCORPORATED ASSOCIATIONS. may be proved in two ways, either by authority given in the constitution and rules of the association or authority personally conferred. The acts of an unincorporated association only bind its members so far as it has received authority from the members. When an association appoints a committee it makes it its agent for certain purposes. In general it is presumed that the committee has not the power to deal on credit. The liability of the mem- bers of the committee for the acts of the committee or of any of its members is no greater than that of the members of the association at large unless by their acts they ex- tend it. UNINCORPORATED ASSOCIATIONS. 45 CHAPTER IV. MANAGEMENT OF AN UNINCORPORATED ASSOCIATION- CHANGE OF RULES— EXPULSION OF MEMBERS, ETC. § 25. An unincorporated association having been formed, many interesting questions may arise concerning its management. In general, such questions are to be determined by a reference to the agreement under which the association exists. But it is when this agreement is inadequate or has been violated, that Courts of law are called upon to determine the rights of the members. In an association of this kind, the relationship of whose members depends so much upon its articles of association, and its rules and regulations, it is import- ant to observe how, if at all, these articles and rules may be changed. If the articles provide for a change, those provisions must, of course, be followed. But suppose there is no such provision, can there be a change; and, if so, how can a change be effected] As these associations are in their formation voluntary, so they may at the will of their members be changed.^ These changes may be of two kinds : first, the change may be one which affects the fundamental principles and pur- poses of the association, and in that case nothing less than the unanimous consent of the members will be suffi- cient -^ second, the change may be one which affects only the ordinary operations of the association without altering ' Atty.-Gen. vs. Murdock, 1 DeG. M. & G. 86. ' Dawkins vs. Autrobus, 11 Ch. D. 620. 46 UNINCORPORATED ASSOCIATIONS. any of the essential features of the contract, and in this case the agreement of the majority would be sufficient. § 26. The majority may direct and control consistently with the particular and general laws of the organism, but not in violation of them.^ In Unangst vs. Shortz,^ when a question arose as to the validity of the action of cer- tain members of a church, Judge Banks said : " In mat- ters relating to the church the will of the majority fairly expressed on any subject within the range of their au- thority, must govern, in the absence of all rules to the contrary." It may be objected that if the articles of association are to be regarded as a contract, it cannot consistently be allowed that this contract should be varied in any way by the majority of the contracting parties. It is true that the contract between the members can not be violated, but the articles of association are only evidence of that contract, and these articles must be interpreted in the light of the purposes for which the agreement was entered into. By the very nature of an unincorporated association there are certain rights which are inherent in the mem- bers. Common consent and the necessities of the case have given to the majority certain powers which are sup- posed to be a part of every contract with reference to such associations, unless expressly excepted. Such a power, however, must be exercised so that the already acquired rights of the minority may not be impaired. AVhat these rights are is a matter depending upon the circumstances of each case. Justice Woodward, in Henry vs. Deitrich,^ spoke of a ' Slitter vs. Trustees First Ref. Dutch Church, 6 Wr. 510 ; Pres- byterian Church vs. Johnson, 1 W. & S. 37. » 5 Wharton, 506-513. » 84 Pa. 286. UNINCORPORATED ASSOCIATIONS. 47 distinction which might be made between the exercise of the power of the majority for private purposes and for public purposes, and said that in the latter case the power is to be more favorably expounded. Although this distinction may be based on reason, it is doubtful whether it can be of any practical benefit. What is an exercise of power for private purposes or for public purposes will always be a question of considerable difficulty, and it is likely that, in regulating the exercise of this power, each case will have to be determined on its own merits. No proportion greater than a majority has more inher- ent authority than a majority.^ What a majority cannot do, two-thirds or three-fourths cannot do ; and what a majority may do, a larger proportion may not do any better. The principle that the majority rules has grown from necessity and the spirit of our free institutions. The reasons which have been influential in giving to the majority certain rights apply equally well but no better when the rights of a larger proportion are con- sidered. Associations frequently adopt rules of government by which the consent of various proportions of the members shall be requisite to the validity of various acts, and in such cases the constitutional provisions must be adhered to. There also exists a code of rules for parliamentary practice, which has acquired by common consent a con- siderable definiteness, but these are merely rules of con- venience and have no binding force upon an association unless accepted by it. Suppose a member of an association opposes a motion before its passage and declares he will not abide by it ' Atty.-Gen. vs. Murdoch, 1 DeG. M. & G. 86 ; 12 Eng. Law and Eq. Rep. 83, 98 ; Opinion by Vice-Chancellor Knight Bruce. 48 UNINCORPORATED ASSOCIATIONS. after its adoption, will he be bound by the adoption of the motion ] As far as the majority act within the scope of their power, the act is as binding upon the minority as their own act would be. If a motion is properly adopted, a member, although opposing, will be bound by it.^ But it may be urged that, if the liability of a member of an unincorporated association is founded upon the law of asencv, it is inconsistent that a member should be held responsible as a principal for the acts of other members as his agents done against his directions. He, however, virtually approves of the agency and the acts by remain- ing in the association. The only sure method of escaping liability is to sever the relation under which the liability arises; even in that way liability for past acts of the association cannot be avoided. One cannot be a member of an association and enjoy its privileges without bearing the responsibilities incident thereto. § 27. We have already asserted that membership in an unincorporated association is in itself legal property,^ and as such it is as sacred as any other property. The question then arises, what powers of expulsion do such associations possess ? The old notion that a club itself knows best what is good for the club's interests, and that a Court will only use its power upon strong provocation has been abandoned.'^ At the present day the Courts very frequently exercise their power to reinstate an ex- pelled member. The best example of this to be found in the Pennsylvania Reports is the case of Leech vs. Harris,'* in which the Court considered the powers which ' MacDowell vs. Ackley, 93 Pa. St. 277, 283. ' Metropolitan B. B. Club vs. Simmons, 17 W. N. C. 153. ' Article in QS Law Times, 94 (1879). Fisher vs. Keane, 41 L. T. Rep. N. S. 335. * 2 Brewster, 571. UNINCORPORATED ASSOCIATIONS. 49 the Philada. Board of Brokers, an unincorporated associa- tion, might exercise over its members. Complaints con- cerning certain transactions in real estate were presented to the board against one of the members by a person who was not a member. The board ordered these complaints to be investigated and were about to expel the member, when he filed a bill in equity, and obtained an injunction restraining the board from investigating the matter of complaint, and from proceeding against him in any way whatever. § 28. Judge Pierce, in continuing the special injunc- tion in the above case, said : "I have very Httle doubt that the same rules of law and equity, so far as regards the control of them and the adjudication of their reserved and inherent powers to regulate the conduct and expel their members, apply to them as to corporations and joint- stock companies." What these powers of regulation and expulsion are in Pennsylvania is then summarized as follows : — ^ I. Where a charter of a society provides for an oflfence, directs the mode of proceeding, and authorizes the society on conviction of a member to expel him, this expulsion, if the proceedings are not irregular, is conclusive, and can not be inquired into collaterally by mandamus action or any other mode. II. The inherent power to expel a member may be ex- ercised : — I. Where an offence is committed which has no im- mediate relation to a member's corporate duty, but is of so infamous a nature as renders him unfit for the society of ^ Leech vs. Harris, 2 Brew. 571-576. This summary was originally given in the opinion of C. J. Tilghman in Com. vs. St. Patrick Bene- volent Society, 2 Binney, 441, the leading case on this subject in Pennsylvania. 4 50 UNINCORPORATED ASSOCIATIONS. an honest man. Such are the offences of perjury, for- gery, etc. But, before an expulsion is made for a cause of this kind, it is necessary that there should be a previous conviction by a jury, according to the law of the land.^ 2. When the offence is against his duty as a corpora- tor ; and in this case he may be expelled, on trial and conviction, by the corporation. f3. Where the offence is of a mixed nature against the member's duty as a corporator, and also indictable by the law of the land. § 29. Another interesting point arose in the case of Beech vs. Harris.^ It will be observed that the board had not adjudicated nor finally acted upon the complaint, and the plaintiff only averred that he was convinced that the board would suspend him. It was argued that the plain- tiff had come too soon, and that the bill could not be maintained until the board had taken future action. But the Court in overruling this point said : " Equity prevents mischief It does not wait until it is consummated. It does not even measure the paces by which it advances. It meets it at the very threshold, and seeks to prevent a meditated wrong more often than to redress an injury already done." § 30. The law does not permit an association to insert in its rules indefinite powers of expulsion. It is totally incompatible with the whole spirit of our institutions to clothe any body with such indefinite power over its mem- bers ; for it is equivalent to socialism, and it is a rejection of all individual rights, within the association.'' If indefi- ' The right of trial by jury for indictable offences is a constitutional right. If tried by the tribunal of an association, there would be no compulsory process for obtaining witnesses. ' 2 Brewster, 571-588. ' Lowrie, C. J., in the Butchers' Beneficial Association, 11 Casey, 151 ; Evans vs. Philada. Club and cases cited therein. UNINCORPORATED ASSOCIATIONS. 51 nite powers of expulsion existed, the designing members of an association could combine to expel their fellow- members under various pretences, and after having ob- tained control of the organization dissolve it and divide the property among themselves. Whenever such a power is given by the rules of the association, the law adds to it the qualification that it must be exercised in good faith,^ and for the interests of the association. In Richardson-Gardner vs. Freemouth (1871),^ a bill was filed by the complainant against mem- bers of the committee of the Junior Carlton Club, from which he had been expelled, praying that he be restored to membership. There was a rule of the club that " in case the conduct of any member, either in or out of the club-house, shall, in the opinion of the committee, be in- jurious to the character and interests of the club, the committee shall be empowered to request such member to resign," and, upon his failure to resign, a discretion was given to two-thirds of the members present to expel him. In accordance with this rule the complainant was expelled, and Lord Romilly, in refusing to reinstate him, said : " It is to be observed that these clubs are formed for social purposes, and there must be some paramount authority to keep up their objects. In some cases this Court will interfere with the exercise of that paramount authority, but only where there is a moral culpability, as if the decision has been arrived at from fraud, personal hostility, or bias If the decision has been arrived at bona fide, without any caprice or improper motive, then it is a judicial opinion from which there is no appeal." * Bona Jide means that they shall act with some cause, or, as the law phrases it, reasonable and probable cause. Sir George Jessel, in Darkins vs. Artrobus, 1 1 Ch. D. 620. * 24 L. T. N. S. 81. 52 UNINCORPORATED ASSOCIATIONS. The same principle was applied by Lord Romilly in Hop- kins vs. Marquis of Exeter.^ In Commonwealth vs. Green (1839),^ one of the ques- tions which came before the Supreme Court of Pennsyl- vania was as to the validity of certain actions of the General Assembly of the Presbyterian Church of the United States in cutting off certain synods from member- ship in that body. Chief Justice Gibson, in delivering the opinion of the Court, said that if the Assembly pro- ceeded in good faith, the validity of its enactments could not depend on the justness of its conclusions. " We have no authority to rejudge its judgments on their merits." § 31. Not only must this discretion be exercised in good faith, but the person against whom it is exercised must be given an opportunity of explaining or defending his conduct. And this is a general principle, that in all cases of judicial inquiry where a man may be deprived of his rigbts, he must be given an opportunity of defending him- self. In the case just mentioned, Judge Gibson said : " Now, had the exscinded synods been cut off by a judi- cial sentence without hearing or notice, the act would have been contrary to the ordinary principles of natural justice, and consequently void." The same principle was laid down in O'Hara vs. Stack.'' The Court in that case said : " It is a maxim of funda- mental law, that no man shall be condemned without a hearing. A hearing assumes notice of the specific grounds ' L. R. 5 Eq. 63; Lyttleton vs. Blackburn, 33 L. T. S. 642 ; Gard- ner rs. Freemouth, 19 W. R. 256. * 4 Wharton, 531. See also Frey vs. Fidelity Lodge, etc., 6 Pa. C. C. Rep. 435 ; 46 Leg. Int. 118, deciding that the rights of those who claim through members of beneficial societies are determined by the peculiar laws of each association. » 90 Pa. 477-490. UNINCORPORATED ASSOCIATIONS. O^^ of complaint, and a reasonable opportunity for answering them. In all matters of faith and of doctrine churches will be left to speak for themselves. When rights of property are in question, civil Courts will inquire whether the organic rules and forms of proceeding prescribed by the ecclesiastical body have been followed." This principle was established in an early case, Innes vs. Wylie,^ and has been reiterated in many subsequent cases. In Willis vs. Child,^ the trustees of a school were restrained from enforcing a resolution removing a school- teacher because it appeared that he had no proper oppor- tunity afforded him of defending himself or explaining his conduct. In Fisher vs. Keene (1879),^ a member of the Army and Navy Club, who had been expelled by the committee without notice to him and without having heard all the circumstances of the case, filed a bill against the trustees and committee of the club, asking that the resolution be declared void. The petition was granted, first, because the rules of the club concerning expulsions had not been adhered to ; and second, because, had the rules justified the action, the method of carrying them in force was not such as, according to the rules of conducting judicial, or quasi-judicial proceedings, ought to have been adopted. In a late case, Sperry's Appeal," it appeared that the plaintiff was a member of a beneficial society, and on charges of fraud and feigning sickness in order to obtain sick benefits was suspended from the society. He then brought a bill in equity, asking reinstatement, and alleg- ing, among other irregularities in the proceeding under 1 1 C. & K. 257 ; 47 Eng. Com. Law. * 13 Beav. 117. ' 41 L. T. N. S. 335 ; Dean vs. Bennet, L. R. C Chan. 489. * 116 Pa. 391 ; 2 Pa. Sup. Ct. Dig. 192. 54 UNINCORPORATED ASSOCIATIONS. which he was suspended, that the committee before whom he was tried rejected the evidence of the physician who had attended him. The lower Court made a decree in favor of the plaintiff, but on appeal this decree was reversed. The members of the Supreme Court were divided in their opinions as to whether the decree should be reversed, although it was admitted that the rejection of the evidence of the physician who attended the plain- tiff was a mistake. Mr. Justice Gordon, who delivered the opinion of the Court, said : " Admitting that this evidence might have been relevant for some purposes, and ought therefore to have been admitted, nevertheless, it does not appear that it was anything more than a mistake in the judgment of the committee, nor does it appear that any complaint was made of this ruling on the subsequent trial in the lodge Here, if we are to be- lieve the master, was an appearance, a regular adjudication, and no complaint made of the action of the committee, a clear waiver of the defect complained of" It will be seen that the decision was based upon two grounds: first, that the irregularity was only a mistake in the judgment of the committee which a Court of law would not inquire into collaterally ; second, that there was a waiver of the defect. Upon the first of these points Mr. Justice Green, in his dissenting opinion (Mr. Justice Trunkey concurring), took issue, and, we believe, sustains the justice of his views. The weight of authority and of reason goes to show that in proceeding against corporators, within the corporation, whether for suspension or expulsion the procedure must be in conformity with the organic law of the corporation ; the cause must be sufficient, the trial and proceedings must be regular, and the proof must be at least adequate in the judgment of the corporation ; and in case of a contest in the civil courts that fact must affirmatively UNINCORPORATED ASSOCIATIONS. 55 appear in the answer or return of the corporation. As to the second point, whether the action of the plaintiff was a waiver of the defect, it does not clearly appear just what is sufficient to constitute a waiver of an irregularity. In this case the doctrine of waiver was certainly carried to a great length, especially when we consider that the proceedings before the committee and before the lodge were not conducted with the formal requisites of judicial trials, that the ordinary rules of evidence were not followed, and that both the suspended member and his representative at the trial were laymen and not expected to take formal exceptions with legal accuracy. Yet it seems to be the law of Pennsylvania, as recently expressed by the Supreme Court, that almost technical care must be taken by a member in the assertion of his rights in order to protect himself from irregularities in the action of his association towards him. § 32. A society may however depose its members from positions of trust and confidence in the management of its affairs without assigning any cause. In Brown vs. Griffin,^ a lodge of the United Order of Brothers and Sisters of Love and Charity, a beneficial association, appointed trustees for the purpose of depositing funds in a bank. These trustees were deposed and others ap- pointed, but the old trustees refused to give up the books containing the entries of deposits, and the bank refused to recognize the new trustees. A bill was filed against the bank and the old trustees to compel the delivery of the books, and to restrain the bank from paying money on the order of the old trustees. One of the old trustees demurred, alleging that the bill set forth no sufficient grounds for the removal of the trustees. The demurrer » 13 W. X. C. 91. 56 UNINCORPORATED ASSOCIATIONS. was overruled on the ground that trustees, without inter- est, might be removed at the pleasure of the association which appointed him. § 33. Equity will interfere to prevent abuses of power within an association, and to restore members to their rights as well as to restrain the illegal expulsion of a member. In Beasly vs. Allyn,^ the complainants were members of the Philomathean Society of the University of Pennsylvania, an unincorporated association. A bill was filed to compel the restoration to the society of a wooden bowl which it was claimed had been presented to the respondents in violation of the rules of the society, and of the rights of the minority of the members. A demurrer to this bill was filed, and Judge Allison, in his opinion over- ruling the demurrer, suggested this question : " Whether a voluntary society of this kind, without a charter, and not a charity, can by a majority vote bind the minority who object to giving away or otherwise disposing of the property of the society, there being no such power given by the law of the body V^ Upon the principles we have stated, we would answer, " No." It would be a violation of vested rights. Unless sanctioned either by the rules, or by the nature and purposes of the society, it would not be valid. Where no provision is made, or where such an action does not fall within the general purpose for which the society was instituted, a part of those who hold property in common cannot exercise a donative power over it ; otherwise, the property of the association might be voted to parties or for purposes in which the donors alone were interested. It has been decided that the majority cannot borrow money and make the minority liable for its repayment without any provision in the 1 12 W. N. C. 90. UNINCORPORATED ASSOCIATIONS. 57 articles of association, or without their assent or ratifica- tion.^ And it is equally just that they should not be able to give away property in which the minority arc joint owners, without their assent. 1 Ash vs. Guie, 1 Out. 493. 58 UNINCORPORATED ASSOCIATIONS. CHAPTER V. ASSOCIATION RIGHTS AND LIABILITIES— PROPERTY- CONTRACTS— RIGHTS OF SUIT. § 34. An unincorporated association may possess prop- erty. Nothing is more common than for such associations to have houses, furniture, books, etc. It may have an equitable title to real estate, but it cannot buy, hold, and sell in its own name like a corporation. Its property must be held in trust for it, and a Court of equity will compel the trustees to carry out the purposes of the trust. The interest which members have in such property is like that possessed by tenants in common. In Livingstone vs. Lynch,^ the relation of the stockholders of the North River Steamboat Company, an unincorporated company possessing certain rights and privileges of navigation, came before the New York Courts, and Chancellor Kent, in an elaborate opinion, held that the members were tenants in common of these rights and privileges. § 35. Upon the dissolution of the association the prop- erty would ordinarily be divided among the members ; but if the property be trust property, equity will decree its application to the purposes of the trust. If the associa- tion; be a branch or offspring of some superior or parent body, from which it has received its warrant or charter, and the rules of the superior body require that upon ^ 5 Johnson's Chancery Rep. 573. UNINCORPORATED ASSOCIATIONS. 59 dissolution or expulsion of the dependent association its property shall go to the superior body, that disposition of the property will be carried out. The act of the 26th June, 1883, provided, that under such circumstances in the case of benevolent, charitable, or beneficial associa- tions the property of the minor association shall be con- sidered as trust property for the parent or superior body. § 36. The rights and liabilities of members of unincor- porated associations may be enforced by suits, which may be brought in two ways : — 1. By or against the individual members. 2. By or against the association. Suits of the former kind do not require to be particu- larly mentioned in this essay. They are brought in the ordinary form of suits between individuals, and only differ from other suits of that character in that it may be shown that the rights or liabilities which they are brought to en- force arise through the medium of an association. Such suits may be brought either at law or in equity. Instances at law are Todd vs. Emley,^ Eichbaum vs. Irons,^and Cham- bers vs. Calhoun.^ Instances in equity are Cullen vs. The Duke of Queensbury,* and Metropolitan Base Ball Club vs. Simmons and others.^ They are subject to the ordi- nary rules governing suits by individuals against individu- als. If the right or liability for the enforcement of which the suit is brought be a joint right or liability arising through membership in the association, the proper parties must be joined, in the same manner as if it had arisen by contract. In Beaumont vs. Meredith^ a bill was filed by some members of an unincorporated association against seven members in their individual capacity, praying an » 8 M. & W. 505. ' 6 W. & S. 67. » 18 Pa. 13. * 1 Bro. Ch. Ca. 101. ^ 17 W. N. C. 153. ^ 3 Ves. and Bea. 180. 60 ; UNINCORPORATED ASSOCIATIONS. account and injunction. There were forty-seven other members standing in the same position as the defendants, and the bill was dismissed for the non-joinder of the proper parties defendant. If all the parties who incur a joint liability are not joined, it may be the subject of a plea in abatement, and the Court will allow such amendments to be made as are shown to be necessary. In Ash vs. Guie,^ where an at- tempt was made to charge the members of a lodge with a joint liability, and it was objected that some of the parties were omitted, the Supreme Court said : " But they cannot complain if the plaintiff fails to include every one in the action who is liable, or fails to discover proof against every one included. In the nature of the case it is difficult for the plaintiff to determine in advance the precise individuals who are liable, although he be sure of some, and the Court below has not been, and is not likely to be, slow to allow necessary amendments authorized by statute." In Pennsylvania equitable principles are sometimes ad- ministered under common law forms so that some actions might be maintained at law which, in England, would only be permitted in equity ; for instance, in Chambers vs. Calhoun,'^ where there were three surviving members of a building committee, two of them were allowed to main- tain an action against the third for a subscription payable to the committee. Chief Justice Gibson said that, al- though such a suit could not be maintained in England, it may be permitted in Pennsylvania in order to prevent a failure of justice; and the dropping of the name of the promissor from the plaintiffs in the suit lessened the ap- pearance of irregularity. ' 1 Out. 493. ' 18 Pa. 13. UNINCORPORATED ASSOCIATIONS. 61 § 37. An unincorporated association may acquire rights and incur liabilities by contracts, and these may be enforced by suits brought by or against the association. Justice Lowrie, speaking of unincorporated religious so- cieties, said that there ought to be no doubt about their rights to sue on a contract made with them in their asso- ciate capacity, and for the legitimate purposes of their association, even though there be no person named or described in the contract as trustees or committeemen on behalf of the society.^ These suits may be brought either in equity or in common law Courts, and they may be brought by or against either members of the association or persons outside of the association. So that there are four heads under which these suits may be considered : first, suits brought by a member against an association ; second, by an association against a member ; third, by a stranger against an association ; and fourth, by an associ- ation against a stranger. An unincorporated association cannot sue or be sued in its own name.^ Such suits must be brought by indi- viduals in behalf of the association or against individuals who represent it. The general rule as to joinder of parties is that all persons interested in the subject-matter of a suit, although numerous, must be made parties to it. But this rule, if applied to unincorporated associations, would work great inconvenience. The members are usually numerous and difficult to ascertain. In many cases they are constantly changing and the proceedings would be subjected to perpetual abatements and delays. Undei these circumstances, as there is a privity of interest, suits may be brought by or against some of the parties as rep- ^ Phipps vs. Jones, 8 Harris, 263 ; Ryerss vs. Cong, of Blossburg, 9 Casey, 117. » Paul vs. Keystone Lodge, 3 W. N. C. 408. 62 UNINCORPORATED ASSOCIATIONS. resenting themselves and all the others, care being taken that there shall be a due representation of all substantial interests before the court.^ And this is permitted in law as well as in equity. In Phipps vs. Jones," it was said that if the English common law forms are not sufficient for such cases, we admit the infusion into our law of the plain equity prin- ciples that allow a committee of voluntary societies to sue and be sued as representatives of the whole. § 38. First. Suits brought by a member against the association. In suits of this kind all the members of the association may be joined as parties defendant or suit maybe brought against the committee, the trustees, or a number of the members representing the association. In Bromley vs. Williams,^ a bill was brought by the assignee in bank- ruptcy of a member of " The St. Ives Shipping Insurance Club" against the treasurer, secretary and seven members as representing the association. A demurrer to the bill for non-joinder of the proper parties was overruled. Sir John Romilly, Master of the Rolls, stated that the rule which formerly existed, that all the parties defendant must be joined, had been modified to suit the exigencies of modern practice, and that the rule was well established that two or three of a class may be made defendants to represent the class. In Pearce vs. Piper,* the court enter- tained a bill for an account filed by certain members of an association for raising an annuity fund against the trustees of the fund of the society. Suits by expelled members of a club seeking a restitution of their rights ^ Story's Equity Pleading, sections 75 and 107. Maguire's Est., 7 W. N. C. 214. ' 20 Pa. 230; Ryerss vs. Cong, of Blossburg, 9 Casey, 114. » 32 Beav. 177. * 17 Ves. 1. UNINCORPORATED ASSOCIATIONS. 63 are very common ; and in such suits the committee of the club are usually made defendants, and with them are sometimes joined the trustees.^ There are a number of instances of suits brought by a member against the association in Pennsylvania. In Leech vs. Harris,^ a member of the Philadelphia Board of Brokers, whose membership was threatened, filed a bill against the committee and members of the board. Shriber vs. Rapp^ was a common law action of account- render by the administrator of a deceased member of a society of socialists against seven members representing the society. In Singerly vs. Johnson,^ an action of as- s^impsit was brought by the administrator of a deceased member of the Philadelphia Board of Brokers against the treasurer and others, representing the board, to recover the proceeds of the sale of a seat in the board. Although a number of members may be sued as repre- senting the whole association, yet if the association has appointed particular persons to occupy this represen- tative capacity, suits under this head, being brought by members who are supposed to know the rules and opera- tions of the association.,' will be required to be brought against the proper persons. Under this head occur suits by members against bene- ficial societies. At the present day these societies are very numerous, and suits against them for the benefits which they are intended to confer frequently occur. The act of 28th April, 1876, declared that the members ' Richardson-Gardner vs. Freemouth, 24 L. T. N. S. 81 ; Hopkin- son vs. Marquis of Exeter, L. R. 5 Eq. 63 ; Fisher vs. Keene, 41 L. T. N. S. 335. » 2 Brewster, 371. » 5 Watts, 351. * 1 W. N. C. 122 ; 3 W. N. C. 540. * Raggett vs. Musgrove, 2 C. & P. 556 ; 12 Eng. Com. Law. 64 UNINCORPORATED ASSOCIATIONS. of beneficial associations should not be individually liable for the payment of benefits or other liabilities of the lodge or other organization, but that the same should be pay- able out of the treasury of such lodge or organization. Therefore suits for these benefits which might previously have been brought in any of the ways in which suits might have been brought to enforce liability incurred through any other unincorporated association can now only be maintained against the beneficial association in its associate capacity. In Pritchett vs. ShaflPer,^ which was tried previous to the passage of the act of 2.8th April, 1876, a recovery was allowed by a member of a beneficial association who filed a bill against the officers and members of the association for sick benefits. Shortly after the passage of this act, in Paul vs. Keystone Lodge,^ an action of assumpsit for sick benefits was brought against " The Keystone Lodge No. 2, Knights of Pythias" (eo nomine), by a member of the lodge. The defendant demurred and alleged that the plaintiff" could not main- tain this action against his co-partners. Judge Ludlow sustained the demurrer, and said : " We concur in the opinion of Allison, P. J., in Pritchett vs. Shaffer, and as it appears on the face of the record that the defendant is an unincorporated society, we hold that the present action cannot be sustained :" then, after citing the act of 28th April, 1876, he concluded, " In some vi'ay, therefore, you may reach the funds in the hands of the treasurer, but it is doubtful whether it would not be better to file a bill in equity and let chancery exercise its control over them." It does not appear clearly upon what grounds the judge sustained the demurrer.^ It may have been, 1 2 W. N. C. 317. ' 3 W. N. C. 408 (Feb. 8, 1877). * The case is very briefly reported. UNINCORPORATED ASSOCIATIONS. G5 either because the association was a partnership, and therefore an action at hiw would not lie between the members, or, because the action being brought against the society in its associate name, was improperly brouwlit. We conceive that the second of these is the irround intended, for if it be the first, the opinion is only ex- pressed that it might be better to file a bill in equity. This view of the ground upon which the demiuTer was sustained, is confirmed by the case of Kurz vs. Eggert,^ a case precisely similar in circumstances to Paul vs. Key- stone Lodge, but diff"erent in form. It was assumpsit for sick benefits by a member of '• The Augusta Teutonia Lodge No. 34, Deutsche Order of Hamgri,'' against the officers of said lodge. The defendants demurred and alleged that the suit was improperly brought against the officers of the lodge. Judge Allison (with wliom Judge Ludlow agreed in his opinion as to status of beneficial associations) said : " We think that such an action may be maintained at law. In the present instance, however, the suit is not properly brought." This view of the form of the suit is in harmony with the expression of Judge Arnold, in Commonwealth vs. Yolz.^ " The country is full of these associations, doing much good among the working people, and it is essential that the relief they afford should come promptly and not be delayed by suits as between partners." So that we may draw from these cases the following conclusions : — 1. The members of beneficial associations may bring suit either in equity or at law. 2. Beneficial associations cannot be sued in their asso- ciate name. 1 9 W. N. C. 126. ' U W. N. C. 289. 5 66 UNINCORPORATED ASSOCIATIONS. 3. The officers or members of beneficial associations cannot be sued in their individual capacity. 4. The members of a beneficial association may bring suit either against all the members as co-defendants, or against a number of the members as representing the association. If the defendants plead in abatement the non- joinder of the proper parties, such a plea must give the plaintiff a better form by showing who should be joined. The form may then be altered and the action proceed. § 39. Second, suits brought by the association against a member. This class is just the reverse of the first class. The suits in both cases being brought concerning matters within the association, and with which both parties are equally conversant, are governed by the same rules. An instance under this head in equity is Brown vs. Griffin,^ in which fifteen members were permitted to represent the association in a bill against two of the members. In- stances at law are Raggett vs. Bishop," and Raggett vs. Musgrave,'^ in which a house steward of a club, who was empowered to represent the club in the collection of the house-bills, was permitted to maintain an action against a member for his subscription. A case which is a good illustration under this head, and which also established an interesting point, is Unangst vs. Shortz.^ It was decided in that case that when trustees hold property for an unincorporated society, the society may compel them to permit the use of their names in suits at law to protect that property. Two persons were trustees of property for the use of a religious con- gregation, and an action of trespass qnare dausum f regit ' 13 W. N. C. 91. « 2 C. & P. 343 ; 12 Eng. Com. Law. 3 2 C. & P. 556; 12 Eng. Com. Law. * 5 Wharton, 566. UNINCORPORATED ASSOCIATIONS. 67 was brought in their name against eleven members of the congregation. One of the trustees refused to unite in the action, and declared his willingness to permit the defend- ants to use the property. A bond of indemnity against the costs of the suit was given him, and the form of the action was held good. Under this head may also be placed those cases in which one branch of an association brings suit against certain members, or another branch of the association. If the members are too numerous to sue in their individual capacity, several persons may be taken to represent the others.^ Where two congregations formed a united con- gregation, and some of the members from each of the congregations attempted to obtain control of the property, a bill against them by the ministers and officers of the other congregation was sustained.^ § 40. Third, by a stranger against the association. Suits by a stranger against the association only differ from suits by a member against the association in that the plaintiff is not presumed to be acquainted with the rules or regulations of the association. If the suit be brought in an improper form, and the impropriety is such that it could not reasonably have been known by a stran- ger, it may be amended ; for instance, if the proper parties defendant be not joined, and the error be objected to by a plea in abatement, it will be permitted to correct the error. Under this head may be classed suits by one association against another. These cases have frequently arisen where religious congregations have united to worship in one house, and difficulties or misunderstandings have ^ Broomley vs. AVilliams, 32 Beav. 177 ; see opinion by Sir John Romilly. ^ Henry vs. Deitrich, 84 Pa. 286. 68 UNINCORPORATED ASSOCIATIONS. arisen between them.^ In such cases resort has been fre- quently had to courts of justice, and such suits are usually brought in the name of the trustees of the congregations. Instances in Pennsylvania are Riser's AppeaP and Gass' Appeal.^ § 41. Fourth, suits by an association against a stranger. This is the class in which most care in the form of the suit must be taken, first, because the plaintiff, being the association, is in possession of all the knowledge which is required in order to bring the suit in the proper form ; and second, the defendant, being a stranger, has a right to know by what authority the suit is brought. Who may represent the association in such a suit 1 In the first place, all the members may join in the suit ; secondly, any person to whom that power is delegated by the rules of the association, for instance, the trustees, committee, officers, etc. ; third, any number of the members may sue in behalf of the association, if it appear to the Court that they represent the interests of the association ; and this may be shown either by a recital of the authority under which they act (for instance, by constitutional provision, by vote of the association, etc.), or in any way satisfactory to the Court. It is proper to set forth in the pleading the authority under which they claim to represent the association. The right of an association to sue in the name of several of its members w'as recognized at an early date ' These associations may be regarded in a twofold aspect : First, as a united association; and second, each branch of the association may be regarded as an association ; and accordingly as they are re- garded in one or the other of these aspects, suits between them are illusti-ative of suits between members of an association, or of suits under the third and fourth heads of the divisions we have made. ' 62 Pa. 428. ^ 73 Pa. 39. UNINCORPORATED ASSOCIATIONS. 69 in England. In Cockburn vs. Thompson (1809),^ a bill was filed by several persons on behalf of themselves and all others, the proprietors, of the Philanthropic Annuity Institution, against a solicitor of the institution. A plea of want of joinder of proper parties was overruled by Lord Eldon. He said : " The strict rule is that all persons materially interested in the subject-matter of the suit, however numerous, ought to be parties. That there may be a complete decree between all the parties having material interests : but that being a general rule estab- lished for the convenient administration of justice must not be adhered to in cases to which consistently with practical conveniences it is incapable of application." In Maguire's Estate,^ a claim by the St. Rose Dorcas Society, an unincorporated charitable association, against an estate was presented in the Orphans' Court and offered to be proved by two of the members of the society. The auditing judge (Hanna, P. J.), in disallowing the claim, said : " The St. Hose Society, as such, has no existence in law ; it has no corporate being, and any claim the members have must be prosecuted in the name of all the members of the society. No two members can represent their fellow members, and prosecute suits in their behalf." This was overruled by the Court and the claim was allowed. Ashman, J., said: " That a religious or chari- table society, though unincorporated, may appear as a party plaintiff in the Courts of the state without joining all the members in the action, seems too clear lor dis- cussion." An association may sue either in equity or at law. In Brown vs. Griffin,' a bill was filed by fifteen members ' 16 Ves. 321. ^ 7 W. N. C. 214, O. C. of Philada. ' 13 W. N. C. 91. 5* 70 UNINCORPORATED ASSOCIATIONS. representing an association against three persons, of whom two were members, and one not a member of the association. App vs. Lutheran Congregation^ is an early case in Pennsylvania and an illustration of suits of this class at law. In that case the vestry of an united congregation brought an action on the case against App, for money had and received, and obtained a verdict. In Brown vs. Lutheran Congregation,^ the trustee of the German Reformed Congregation, an unincorporated asso- ciation, brought an action of partition against the Evan- gelical Lutheran Church, an incorporated association. These cases show the general tendency of the courts to recognize unincorporated associations, and to afford to them all the means of enforcing and protecting their rights which are afforded to individuals. § 42. What is the character of the rights, possessed by the members of unincorporated associations, which courts of justice will protect and enforce 1 Will the courts only interfere to protect rights of property, or do they consider that mere membership in an association is itself a right which will be protected 1 This question has never been directly determined in Pennsylvania. In Bauer's Appeal,^ the Court refused to interfere, saying, " No matter of pro- perty invites it, while the disputes in Montezuma Tribe have ample means of remedy in the tribunals of their own choice." In the Metropolitan Base Ball Club vs. Simmons,"* it was shown that the American Association of base ball clubs possessed no, or but nominal, property. The rights of the association consisted in the privilege of playing with the other clubs at certain fixed times. The games were ' 6 Pa. 201 ; Ryerss vs. Cong, of Blossburg, 5 Casey, 117. ' 11 Harris, 495. ' 2 W. N. C. 242, S. C, 5 W. N. C. 485. * 17 W. N. C. 153. UNINCORPORATED ASSOCIATIONS. 71 the source of great profit ; but this profit was not directly the property of the association. Judge Thayer said : " These are certainly rights of property which are enti- tled to the protection of the law," and granted an in- junction to prevent the association from expelling tlie complainants. Sir George Jessel, M. E-,, in Rigby vs. Connol,^ said : " I have no doubt whatever that the foundation of the juris- diction is the right of property vested in the members of the society and of which he is unjustly deprived by such unlawful expulsion If an association has no property and takes no subscription from its members, I cannot imagine that any Court of Justice could interfere with such association if some of the members declined to associate with some of the others." This involves the question of what is property. If by property is meant that which has a pecuniary value and for which compensation in damages would be sufficient remedy, the proposition is open to grave objections, and if the term property is taken in its broadest sense, that is, any right which the law will enforce, then the proposition means nothing. There is no reason that a Court should not enforce any right between the members of an association which they would enforce between individuals. Neither in the case of individuals nor of an association would they en- force purely social rights. The question is largely a theoretical one, because an association seldom exists which does not possess some property (books, memoranda, rega- lia, etc.) having some pecuniary value, however slight. In ^ 14 Ch. D. 482. In Lyttleton vs. Blackburn, 45 L. J. Ch. 223 ; 33 L. T. S. 642, Lord Romilly expressed doubts whether the Court had jurisdiction over an association possessing no property. 72 UXIXCORPORATED ASS0CIATI0X3. Beasly r<^. AUyn,^ the point was made that the property which was the bone of contention in that suit was of too Httle valne (a painted wooden bowl), to require the inter- ference of the Court of Equity. The Court overruled that o'bjection, saying : " The lawful power of a Court of Equity may be called into exercise by other considera- tions than the intrinsic or pecuniary value of property of which an owner has been unjustly deprived or which is withheld from him." Suppose a scientific literary association having no prop- erty, with no dues or expenses, and whose purpose is to meet weekly to listen to lectures delivered by eminent and learned men, a privilege only to be enjoyed by the members of the association. Such a privilege is property which cannot be accurately reckoned in dollars and cents, and yet if a member was expelled from such an associa- tion, without cause, and in direct violation of its consti- tution, it cannot be doubted that a Court of Equity should interfere to compel the restoration to the member of his privileges. § 43. Let us look at one more point and we shall close our consideration of the subject of unincorporated associations. If membership in such an association is property, is it subject to execution and sale for the debts of the owner ^ It is a species of property which is created and limited by the articles of association. In some cases these would render it a mere personal license and valueless as assets ; in others it would be transferable and have a value limited by the terms under which it may 1 12 W. N. C. 90. In O'Hara vs. Stack, 90 Pa. 477-491, the profession of a priest of the Roman Catholic Church was held to be property of which he could not be deprived by the bishop without showing cause and affording an opportunity of defence. UNINCORPORATED ASSOCIATIONS. 73 be transferred. In Thompson vs. Adaras,^ the Supreme Court said that a seat in the Philadelphia Board of Bro- kers " is not property in the eye of the law ; it cannot be seized in execution for the debts of the members. It is the mere creature of the board, and of course is to be lield and enjoyed with all the limitations and restrictions which the constitution of the board chose to put upon it." In that case it was decided not to be property because of the particular limitations put upon it by the board. The statement of Judge Elcock, who decided the case in the Common Pleas, and whose views were confirmed by the Supreme Court, is more accurate : •• A seat in the board is a species of property, encumbered with conditions ; it is not a matter of absolute purchase, for it never was freed from the conditions and duties of the constitution and bv-laws."- But we see no reason why it should not be taken in execution and sold subject to the limitations and restrictions which the constitution of the board chose to put upon it. In the constitution spoken of above, it was declared that - where a member dies his seat may be sold by the secretary, and after satisfying the claims of the members of the board, the balance shall be paid to his legal representatives."^ It would always be a question ' 7 W. X. C. 281 ; S. C. 4 W. N. C. 445 (S. C). ^ 4 W. X. C. 445. See. also, Evans vs. Wister, 1 W. X. C. 181. where an execution was nit permitted because the property fell within certain rules of the association which provided for the disposition of the property. ' And this was done in Singerly Admr. of Singerly vs. Johnson, 1 W. X. C. 122 (D. C.) ; 3 W. X. C. 541 (C. P.). See, also, Leech «•■«. Leech, 3 W. X. C. 542. In Beatty's Appeal, 8 Pa. S. C. Dig. 331 ; 22 W. X. C. 518 (S. C), 45 Leg. Int. 456, the Supreme Court held. tl>at a member of a beneficial society, subject to the rules of the asso- ciation, might change at will the designation of the person to whom the insurance money should be paid at his death. 74 UNINCORPORATED ASSOCIATIONS. how far membership in an unincorporated association was intended to be transferable or transmissible, and in most cases either the constitution or the nature of the associa- tion would prevent its possessing such a character; but so far as it is in conformity with the regulations of the asso- ciation it should be considered as property, and subject to all the rights and liabilities of property. INDEX. THE REFERENCES ARE TO THE SECTIONS. AGENCY, differs from unincorporated associations, 1. principles of, 16. applied to unincorporated associations, 6. ARTICLES OF ASSOCIATION, a contract, (J, 8, 17, 25, 26. BABB vs. REED, 13. BASE BALL CLUB, 12. BENEFICIAL SOCIETY, status of, 1, 10, 12, 13, 14. BENEFITS, 13, 38. liability of members of, 3. not partnership, 10, 13. past and present views of, 10. BY-LAWS, 17. CANON LAW, concerning unincorporated associations, 2. CHARITABLE SOCIETY, unincorporated association, 12, 13. not partnership, 7. CHARITABLE USES, 13. CHURCH, 1. CIVIL LAW concerning unincorporated associations, 2. CLUBS, 1, 9, 22. COLLEGIA, 2. COMMITTEES, 20, 22, 23. liability of members of, 9, 12. COMPANIES, Joint-Stock, 1. CONSTITUTIONS, 17. CORPORATIONS differ from unincorporated associations, 1. CREDIT, dealing on, 9. DEFENCE, opportunity for, 31. DEFINITION of unincorporated association, 1. DUES, 19. ELDON'S, LORD, view of unincorporated associations, 2. ENGLISH DECISIONS, 9. EQUITY JURISDICTION, 3. EXECUTION, membership taken in, 43. EXPULSION, 28, 29, 30, 31. GOOD FAITH, 30. GROWTH of unincorporated associations, 4, 5, 11, 12. IRREGULARITIES in proceedings of unincorporated associations, 31. JOINDER of parties, 36, 37, 38. JOINT-STOCK CO., 1. JURISDICTION of Courts, 27, 29, 31, 33, 36, 41, 42, 43. 76 INDEX. [The references are to the sections.] LIABILITY of member of unincorporated association, 3, 12, 13, 15-24, 26. udar sp, 17. as to third persons, 17. for his own acts, 18. to association, 19. for acts of association, 20. of beneficial association, 21. LITERARY SOCIETY, 1, 3. MAJORITY, rights of, 26. MANAGEMENT, 25. MEMBERS, relation of to each other, 8, 9. third persons, 8, 9. MEMBERSHIP, legal property, 27, 42, 43. MOTIONS, 26. ORIGIN of uniucorporated associations, 2. PARLIAMENTARY PRACTICE, 26. PARTNERSHIP ASSOCIATION, 1. differs from unincorporated associations, 1, 6, 11, 12. deflned, 6. PENNSYLVANIA LEGISLATION concerning unincorporated associations, 3. POSITIONS OF TRUST, 32. POWERS, indefinite, 30. PROPERTY RIGHTS, 3, 34, 35, 42, 43. PROTCHETT vs. SCHAEFER, 13. for public and private purposes, 26. PROVISIONAL COMMITTEE, 11. RELIGIOUS ASSOCIATIONS, 3, 12. RULES of unincorporated associations, 25, 26. SALE OF MEMBERSHIP, 43. SOCIALISTIC ASSOCIATIONS, 12.^ STATUS of unincorporated associations, 5-15. STATUTORY PROVISIONS, 4. SUBSCRIPTIONS, 19. SUITS, form of, 36, 37. members vs. association, 38. of beneficial associations, 38. association vs. member, 39. stranger vs. association, 40. association vs. stranger, 41. TENANCY IN COMMON, 34. TRADE ASSOCIATIONS, 9. TRUSTEES, 32, 34. UNIVERSITATES, 2. WAIVER OF IRREGULARITIES, 31. fO ^^^ i. -¥ AA 000 851 488 7 JUll iUi t