Wednesday, May 23, 2012

Are These Articles Valid, Part 5: The invalid amendments from 2007 to 2009

We continue in this post to examine the details of the decision by the Board of Directors of the Minnesota South District of the Lutheran Church - Missouri Synod to sell the campus ministries in Mankato and Minneapolis.  Previous posts have given the source documents to establish that the last valid Articles of Incorporation for the Minnesota South District are from 1966.  In this post we examine the changes from the two questionable filings of their Articles of Incorporation from 2007 and 2009.

While the filings for both years fail the corporations own standard and process for amending articles given in Article IV, it is instructive to see what changes were proposed in 2009.  Here are the amendments from each year:

2009 Article III Section 3d:

2007 Article III Section 3d:

And the 1966 Article III Section 3d:

Now for the second amendment:

2009 Article III Section 3d Subsection 3:

2007 Article III Section 3d Subsection 3:

And the last valid Articles of Incorporation, the 1966 Article III Section 3d Subsection 3:

And there is the rub.  The 1966 wording contradicts the later readings of the same Article, Section and Subsection in 2007 and 2009.

Confused?  You should be.

The reasons for this may be varied, but there is an explanation for one aspect.  Handbook committees dutifully recorded changes to the Handbook after each convention, including amendments to the articles.  But those same amendments never made it to completion.  The presiding officers failed to "certify" them, and the secretaries of the corporation failed to "verify" them, and all of the officers failed to file them "with the secretary of the State of Minnesota, according to law" for over 40 years, from 1966 to 2007.  That tradition continues to this day, because the efforts to file the amendments in 2007 and 2009 also share the same failures as explained in previous posts.

We gain some clarity by seeing the 1966 Article III Section 3d Subsections 3 and 4 together:

This had to be a mystery to anyone who carefully read the Handbook of the corporation from 1974 until 2007.  The deletion of Subsection 3 above was proposed in 1974, but failed because it was never verified by the presiding officer, certified by the secretary, or filed (as pointed out in the previous posts).  But the Handbook Committee marched on in spite of this and changed the Handbook to delete the section, so here is how the Handbook would have read, from sections 2 to the new section 3:

2. To administer legacies and trust funds for the uses and purposes for which they are designated or specified.
3. The Board shall have authority to mortgage, sell, encumber, lease or dispose of any other real estate without authorization by its voting members.
We've emphasized the word "other", because while it is non-sensical, it is still the correct reading.  That's because section 3 is the old section 4.  But without the original section 3 in the Handbook, to what "real estate" would "other" have referred?  The Handbook Committee in 1974 proposed to delete Subsection 3 but did not propose to change the wording of Subsection 4.  That makes the resulting wording odd, to say the least.  Perhaps that is why no vote totals are recorded for the amendments proposed in 1974, and why the "reading" was sent back to committee.  It's possible someone caught this error, pointed it out, and the proposed amendment did not receive 2/3's vote (as noted in a previous post).

So who was aware of this?  Why would they try to "correct" this language in 2007 and 2009 without bringing it to the attention of the voting members in convention?  Did they notify anyone else - say, the directors of the corporation - of the problems with the Articles of Incorporation?  And why would they change the phrase "without authorization by its voting members" (present in the valid 1966 articles and repeated in the invalid 2007 articles) to "without a specific vote by the corporation's voting members" in the invalid 2009 articles?

If the officers of the corporation were contemplating the sale of ULC ("1101 University Avenue SE, Minneapolis, Minnesota") without the approval of their voting members as early as the 2006 convention, why would they not openly and honestly ask to correct these problems with the Articles of Incorporation to allow them to do so?  Why file what appear to be cosmetic amendments to the articles in 2009, when they could have explained the problems to the voting members at that year's convention and asked them to correct them?  And why file an entire set of "restated and amended articles" in 2007 without presenting them before or after to the voting members in convention in 2006 or 2009?

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