Giveaway House files lawsuit

The granddaughter of a local charity's co-founder faces more legal issues in a dispute over that charity.

Community Giveaway House filed a lawsuit against Sheila Forshee, her mother and a former fellow board member. Sheila Forshee also faces a criminal case involving the charity.

The lawsuit against Sheila Forshee, Carol Ann Nystrom Forshee and Kelley Ann Damson alleges that Carol Forshee made false representations in a notice of noncompliance she filed with the Hill County Clerk and Recorder which says Community Giveaway House failed to act under its rules as a nonprofit. The notice said that allowed Carol Forshee to dissolve the entity, which the notice says she did. Forshee cited her status as a court-appointed director of the board and daughter of Ruth and Karl Nystrom in dissolving the board.

Carol and Sheila Forshee then persuaded Community Giveaway House board member Damson to sign over to Carol Forshee the deed to the North Havre property where the charity operated, the lawsuit says.

Both the notice of noncompliance and Carol Forshee's ownership of the property were recorded in the Hill County Clerk and Recorder's Office Oct. 10. Her notice of noncompliance says she served the charity's board with an eviction notice Sept. 6.

The criminal case filed against Sheila Forshee says the board removed Carol Forshee from the board in a meeting Sept. 25 due to "failing to act in the best interest of the Give Away House (sic) and based on a conflict of interest."

The board previously had notified Forshee that she did not have the authority to evict the charity, the criminal complaint says.

Community Giveaway House moved out of the property in March, with its activity starting again as Havre's Helping Haven in the former Central High School building of St. Jude Thaddeus School on the 400 Block of 6th Avenue.

The lawsuit alleges the Forshees took the action with the intent of selling the property to BNSF Railway. That company has been purchasing property in the area that is above a plume of contaminants the railway company is in the process of remediating.

It says the Forshees damaged the Giveaway House location, taking fixtures, doors and appliances and exposing the property to damage over the winter months.

In the identical responses to the lawsuit filed by the Forshees and Damson, they deny that Community Giveaway House is a nonprofit entity in good standing with the state of Montana and deny all claims made in the lawsuit that their actions were "fraudulent, oppressive and malicious" and done "for the sole purpose of annoying, vexing and harassing" the charity to enable converting and selling the property.

The Giveaway House is asking the court to order the defendants to return all Giveaway House property and to award cash damages and a punitive amount.

Sheila Forshee's trial on felony charges that she illegally persuaded Damson to sign the property over to Carol Forshee and stole items Walmart had donated to the charity is scheduled to start Oct. 21.

A problem decades

in the making

Ruth Nystrom and Ann Friesen created the charity in the early 1970s. They would accept donations of items - food, clothing, furniture, books, whatever people wanted to donate - and give them to whomever wanted them.

The charity operated out of a North Havre house owned by Ruth and Karl Nystrom. It grew in reputation, with people coming from out of state and even from Canada to browse its items.

In 1998, Ruth Nystrom and Ann Friesen incorporated the charity and joined the new nonprofit board as two of its original board members. Ruth and Karl Nystrom signed the deed of the property over to the corporation on the terms that if it ever failed to act as a nonprofit charity, the deed reverted to the Nystrom family.

In 2008, when the board was about to dissolve the corporation due to a lack of volunteers, Sheila Forshee stepped in and helped revitalize the charity.

It continued operations for several years, until a split in its board occurred in 2012.

Some officers of the board said Forshee, who served as secretary-treasurer but was not a voting member, had failed in her duties to maintain the nonprofit's federal tax exemption status and failed to pay premiums on liability and property insurance.

A temporary committee was formed to look into removing Forshee and Damson, who also was a nonvoting officer of the board, from the board. In a January 2013 meeting, the committee decided not to recommend their removal.

In February, the voting members of the board of directors voted to reform the board, appointing five new directors including one member of the previous board, but not appointing Damson and Forshee.

Forshee in March 2013, citing her authority as the granddaughter of the charity's founder and as a member of its board, formed a new board of her own including herself and Damson.

In April, the February board filed a lawsuit against the members of Forshee's March board.

After state District Judge Dan Boucher ordered the two groups to attempt mediation, Havre Attorney Stephen Brown negotiated a settlement creating a new board which included Carol Forshee, Damson and two members of the February board. Sheila Forshee was not a member of the settlement board.

Boucher approved the settlement agreement in December 2013 and appointed a fifth board member.

New troubles arise

The criminal complaint says that Sheila Forshee for several months refused to turn the keys to the North Havre property over to the new board. She eventually did so, and the charity reopened and resumed operations.

The complaint says Forshee refused, however, to turn over the key to the nonprofit's post office box, for which she was the only authorized user.

A board member eventually went to the Havre post office and found that box had been closed a week before and a new one opened for Community Giveaway House. The board member showed documentation of the new board's authority, closed that box and opened another new box for the charity, the document says.

The document says that Carol Forshee attempted to issue a notice Aug. 4, 2014, to the board to vacate the North Havre property. The board informed her she had no authority to do so, as Karl and Ruth Nystrom had turned the property over to the corporation in 1998.

The board removed Carol Nystrom as a member that September.

A board member met with a Hill County sheriff's deputy in November, telling him that in addition to the previous actions, the board had learned that Sheila Forshee had been accepting donations Walmart made to the Giveaway House but not turning them over to the charity.

The board member said the board notified Damson earlier in November, after learning she had signed the deed, that she might be removed from the board. Damson notified the board via email Nov. 25 that she no longer wanted to be a member, the document says.

Another board member in January told the deputy Forshee had accepted items Walmart donated to the Giveaway House but was selling them in her own thrift store, Ruth Ann's, rather than turning them over. He said he believed the Forshees wanted to take possession of the house to sell it to BNSF, the document says.

A Havre Walmart official told the deputy that the company donates some items that are minorly damaged, or returned and cannot be resold, to nonprofit entities including the Giveaway House, the Salvation Army's thrift store and the Havre Animal Shelter. He said Forshee would come to the store about twice a week to pick up items, which he said she told him were going to the Giveaway House.

He told the deputy Walmart cannot donate to Ruth Ann's because it is a for-profit business.

After he was told Forshee was not taking the items to the Giveaway House, he stopped calling her to pick up items, the Walmart official said. He estimated that Forshee had picked up about $9,000 worth of merchandise from January through August 2014.

When the deputy interviewed Damson, the complaint says, she told him that Sheila Forshee had told her the document she signed only involved the Nystrom family and the rest of the board did not need to be involved. She said she never saw the first page of the document she signed and did not know exactly what the document was, but that Forshee told her it would solve all of the problems about the Giveaway House.

She said Sheila Forshee told her that the nonprofit's board was not following the rules required by the charity, and therefore the Forshees were going to shut it down and sell the house to BNSF, the document says.

Sheila Forshee agreed to be interviewed, and insisted on bringing her daughter with her to the interview at the Hill County Sheriff's Office, the document says. She also insisted that she be allowed to call her mother so Carol Forshee could hear what was being said, and was attempting to call someone throughout the interview.

She refused to allow the deputy to read her her Miranda rights, walking out of the interview at that point and saying she had no involvement with the charity and wanted to know why he wanted to talk to her, the document says.