United States: "We'll Just Kick Him Out!" Member Discipline And Expulsion In Private Clubs

Last Updated: January 22 2019
Article by Ryal W. Tayloe

Most private country clubs and social clubs are nonprofit corporations governed by North Carolina's Nonprofit Corporation Act found in Chapter 55A of the North Carolina General Statutes.

Specifically, N.C. Gen. Stat. § 55A‑6‑31(a) (2017) states, in pertinent part, as follows:

  • No member of a corporation may be expelled or suspended, and no membership may be terminated or suspended, except in a manner that is fair and reasonable and is carried out in good faith.

Two recent cases in the North Carolina Court of Appeals provide some clarity to country clubs and private social clubs when they elect to discipline their members, including suspension and expulsion from the club.  The North Carolina statute governing expulsions and suspensions, as interpreted by the Court in the two cases, gives wide deference to private social clubs in matters of discipline resulting in suspension or termination.

In the first case, Emerson v. Cape Fear Country Club (COA 17‑1149), Mr. Emerson was expelled without having been given notice or a hearing.  The Club's governing documents did not require notice or a hearing.  After termination, Mr. Emerson was given an opportunity to address the Club's board but declined.  Based on the particular facts of this case and the procedural posture of it, the North Carolina Court of Appeals determined that the statute did not, as a matter of course, require notice and a hearing in order to terminate the membership.

The Emerson Court compared North Carolina's statute with the America Bar Association Model Non‑Profit Corporation Act ("Model Act"), noting that North Carolina mimicked the Model Act in a number of ways.  However, when it came to the specific provisions dealing with the expulsion of a member, the Court noted that the Model Act required 15 days prior written notice of the expulsion, suspension, or termination and the reasons for it and, in addition, an opportunity for the member to be heard.  The North Carolina Legislature chose not to follow that portion of the Model Act when enacting N.C. Gen. Stat. § 55A‑6‑31.  The Court concluded that the General Assembly purposely declined to follow the Model Act and, in so doing, did not require notice and a hearing.  As a result, the Court upheld Mr. Emerson's termination.

Although the Emerson Court ruled that North Carolina's statute did not require notice or a hearing in all cases, it may be wise for a club to give notice and provide an opportunity to be heard.  The Court placed some emphasis on Mr. Emerson's failure to accept the Club's offer to appear before the Board after the fact, and other court cases would indicate that notice and a hearing may be required.

In the second case decided by the North Carolina Court of Appeals in 2018, Master v. County Club of Landfall (COA18‑215), the Court again upheld the termination of a country club membership.  Contrary to the governing documents of Cape Fear Country Club, the Country Club of Landfall had specific procedures that required notice and an opportunity to be heard.  The Masters complained that the Country Club of Landfall did not follow its own governing documents, did not adequately provide an opportunity to be heard, and did not appoint an "impartial tribunal" to hear the evidence and make a decision. 

In the Master case, the Court of Appeals stated that it is "well established that courts will not interfere with the internal affairs of voluntary associations [and] a court, therefore, will not determine, as a matter of its own judgment, whether a member should have been suspended or expelled."  The Court did hold that the charter and bylaws of a club may constitute a contract between the club and its members, requiring the club to follow them in dispensing discipline.  The Court determined that it is not necessary for private clubs and associations to have an impartial decision maker hear and determine disciplinary matters if the governing documents provide otherwise.  The Court noted that the governing documents of the Country Club of Landfall provided that four members of the Board of Directors and three members of the Rules and Members Committee would make up the hearing panel adjudicating disciplinary matters and that the Club complied with that requirement when it expelled Mr. Master.

CONCLUSION

The North Carolina Court of Appeals has now provided some guidance to private country clubs and social clubs for the discipline of its members.  The "takeaways" appear to be as follows:

  1. Clubs are given great deference to manage their own affairs and in the disciplining of their membership. Courts will not substitute their judgment for the judgment of the club as to whether a member's conduct should have resulted in discipline, including, but not limited to, suspension and expulsion.
  2. A member does not have an absolute right to notice and an opportunity to be heard prior to being disciplined. If the club's governing documents require notice and an opportunity to be heard, those governing documents must be followed. The better approach would be to give notice and an opportunity to be heard whether the governing documents require it or not, which would likely put the club in the best light with the court.
  3. A member of a private or social club does not have a right to a hearing before an impartial tribunal unless the governing documents require it.

Members of private clubs facing discipline should realize that the deck is stacked against them such that seeking forgiveness rather than fighting an uphill battle may be the best course.  Club boards and managers, when meting out discipline, should be very careful to follow their governing documents closely and seek legal advice early in the process.  Getting a cool, independent head involved in the process may be the ounce of prevention that saves a pound of cure.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions