The group of people accused of improperly representing themselves as members of the board of the Giveaway House have responded to the lawsuit, saying the people who filed the lawsuit are not members of a legally formed board because the directors who appointed that board had vacated their positions.
A split in last year’s board led to the lawsuit, with one group that formed a board for Havre’s Community Giveaway House nonprofit corporation in February suing another group that formed in March, with each saying the other has no legal authority to operate the charity.
The attorney for the board formed in February, headed by Sue Markley, had asked the judge to rule on the case, with that board's attorney Tyler Gernant saying the defendants had not responded to the claims in the lawsuit filed April 18.
Wednesday, attorney Robert Kampfer, representing the board formed in March including Sheila Forshee and Roberta Beute, filed responses.
Kampfer said in his filings that the judge must first rule on his motion to halt proceedings until the judge determines if Markley’s board is a legal board and Gernant can legally represent it.
He said Markley’s board was appointed by directors who “clearly had forfeited their positions by failing to attend meetings as required by the bylaws.”
The motion said Markley's board failed to provide notice to the officers who were removed by the action, and that the court should consider that the charity was a Nystrom-family project, Kampfer said.
Forshee is charity co-founder Ruth Nystrom’s granddaughter.
Nystrom, who died in 1999, founded the charity around 1970 with Ann Friesen, who died in 2010. Nystrom incorporated it as a private nonprofit in 1989, and she and Friesen were directors on the original board.
Both Markley and Forshee became involved in the charity in 2008, when the aging members of the board and its managers were ready to call it quits.
In January, dissension between Forshee and Markley came to a head, with the directors listed in the 2012 report forming a board with Markley as a director and the president in February. Then another board formed in March, with Forshee a director and treasurer and Beute as a director and now chair.
In their arguments, the attorneys for each side say the other side has no legal authority to run the charity.
While Markley’s board said it is properly appointed by the directors — under the articles of incorporation and bylaws filed by Ruth Nystrom, only directors of the board can vote or appoint or remove directors or officers — Forshee’s board argues that those directors had forfeited their positions by missing four consecutive board meetings.
The bylaws state that a “vacancy … shall be deemed to exist when a director fails to attend four … meetings.”
Kampfer argues that the board formed in March has the best claim for authority because it was formed by a Nystrom family member and two standing officers — Secretary Forshee and President Damson.
“This is an unusual situation which does not appear to have arisen in Montana case law … ,” Kampfer writes. “There is no provision as to how to proceed where the entire board of directors has failed to meet and relinquished their positions under the bylaws. However, the equities of the situation must be considered.”
He previously said that those equities lie with Forshee’s board.
“Again, treasurer Sheila Forshee was a member of the family who established the charitable corporation in the first place,” Kampfer writes. “In all propriety, she should have been involved in reconstituting a board and appointing new officers (which she, in fact, did on her own).”
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