Greek Orthodox Stewards of America - June 27, 1999


Dimas v. Greek Orthodox Archdiocese Of America
Court Rules Dimas Cannot Show Financial Irregularities And Improprieties

Note from the Editor of the Stewards' Website: Readers should note that the court described Mr. Dimas' contention of financial irregularities and improprieties as "mere allegations." In other words, the allegations could not be backed up by the evidence.

New York Law Journal
June 17, 1999


Justice Weissberg

DIMAS v. GREEK ORTHODOX ARCHDIOCESE OF AMERICA QDS:22701210 -- This is a CPLR article 78 proceeding brought against the Greek Orthodox Archdiocese of America. The Archdiocese was incorporated in 1921 under the New York Religious Corporations Law. Its headquarters are located in Manhattan. The Archdiocese is the highest spiritual and governing authority of the Greek Orthodox Church in the United States for all communicants of the Greek Orthodox faith. The petitioner is a member of the Holy Trinity Orthodox Church of New Rochelle, a parish of the Archdiocese. In this proceeding, he seeks an order annulling a contract which the Archdiocese entered into for the purchase of real property on the ground that the contract was not approved either by the Executive Committee of the Archdiocesan Council or by the court pursuant to Religious Corporations Law §12(1). He also seeks an order directing that the Chancellor and the General Counsel of the Archdiocese return to the Archdiocese the $139,500 deposit which was paid to the seller of the real property at issue. This application is dismissed for mootness. See Matter of Mehta v. New York City Department of Consumer Affairs, 162 AD2d 236, 237 (1st Dept. 1990). It is undisputed that after the contract was signed, the Executive Committee voted against the acquisition of the premises and that the purchase did not and will not go forward. Moreover, although the Archdiocese lost its $139,500 deposit as a result thereof, it is also undisputed that the Archdiocese has since been made whole by a donation in this amount which was specifically intended to cover the lost down payment.

The petitioner also alleges that the Archdiocese has, through its Archbishop, Chancellor and General Counsel, engaged in various financial irregularities and improprieties. He seeks an order, pursuant to section 621 of the Not-For-Profit Corporation Law, directing the Archdiocese to make available to him all of its books and records. In opposition, the Archdiocese argues that the petitioner is not entitled to this relief since he never actually demanded any such books and records and the Archdiocese therefore never actually issued a determination denying him access. Although the respondent is correct in its assertion that the petitioner did not make an appropriate demand prior to the commencement of this proceeding, it would nevertheless be an inefficient and wasteful use of resources for the court to dismiss the application on this ground. Since it is clear from the respondent's papers that the Archdiocese is opposed to producing any of the documents which the petitioner seeks, it would be futile for him to now do so and would only result in his return to the court at a later date. See Matter of Watergate II Apartments v. Buffalo Sewer Authority, 46 NY2d 52, 57 (1978).

The Archdiocese also contends that the petitioner is not entitled to obtain the requested documents. Under NPCL §621(b), any person who has been a member of the corporation for at least six months shall have the right to examine the minutes of the proceedings of its members and the list or record of these members. Section 601(c) of the NPCL sets out the criteria for determining whether a person or entity is a member of the corporation. It provides that membership may be evidenced, inter alia, by any such method as prescribed in the certificate of incorporation or by-laws. There is, however, nothing in the respondent's certificate of incorporation or by-laws which specifically addresses membership in the corporation. The by-laws nevertheless do include a definition of membership in a parish. The respondent concedes that the petitioner, under this definition, is a member of one of its parishes, but argues that membership in a parish does not constitute membership in the Archdiocese. However, if a parish member is not a member of the Archdiocese, then who is? The Archdiocese has not suggested that, pursuant to NPCL §601(a), it is a corporation without members. In the absence of any provision in the by-laws which distinguish between membership in a parish and membership in the Archdiocese, the court must conclude that the two are one and the same. Indeed, in a recent decision, the United States District Court for the Southern District of New York noted that the Archdiocese maintains a confidential membership list of approximately 131,000 names and that this information was generated primarily from information provided by parishes throughout the United States. See the Greek Orthodox Archdiocese of North and South America, Inc. v. Greek Orthodox American Leaders, Inc., 1998 WL 832707 (S.D.N.Y.) (Chin, D.J.). In doing so, the court rejected the respondent's argument that individual members of the church are not "legal" members of the corporation for purposes of section 621(b), finding that the Archdiocese was "splitting hairs and engaging in semantics." The court concluded that section 621(b) should apply to all members of the Archdiocese, whether spiritual or corporate, so as to entitle them to have access to all documents which the statute covers. Accordingly, the petitioner, as a member of the Archdiocese, must be afforded the opportunity to examine the minutes of the respondent's proceedings and a record of its members.

To the extent that the petitioner seeks additional records, his request is denied. He has failed to show that he is entitled, under common-law principles (see NPCL §621(f), to the financial records and documents which he seeks. His mere allegations of financial irregularities and improprieties do not, on the record before the court, justify such a broad document inspection. See Matter of Mathews v. Onondaga County Deputy Sheriff's Benevolent Assoc., Inc., 225 AD2d 1048, 1049 (4th Dept. 1996).

Accordingly, the petition is granted insofar as it seeks access to the documents listed under NPCL §621(b) and is otherwise denied. The respondent's cross-motion for sanctions against the petitioner is denied.

The foregoing constitutes the decision, order and judgment of the court.

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  June 27, 1999 ]