The arguments were heard by a three-judge panel consisting of Judge Ricciardulli, Judge Kumar, and Judge Richardson. The judges were interested in the appellant's argument that, in effect, all extraordinary meetings of the parish board (i.e., the vestry) and membership must be conducted according to an extremely strict reading of the Corporations Code, and if there were any error in procedure, whether or not it was material, no action taken by either the board or the membership could be valid.
Judge Kumar, the presiding judge, questioned Matthew Gershman, who argued for the Bush group, on whether there could be such a thing as "substantial compliance" in interpreting the Corporations Code Section 9413. This requires that all members of a corporation be notified of an extraordinary meeting. He gave a hypothetical in which (as best I can recall) a corporation had 1000 members. Due to some inadvertency, two members could not be notified. However, the vote for the measure in question might be 700 for, 300 against. Would it matter if the two members were not properly notified?
Mr Gershman refused to answer this question and instead substituted a different hypothetical, in which the vote was 499 to 501. In this case, he felt that not notifying two members would be important. Judge Richardson then commented that the hypothetical Mr Gershman gave was not the hypothetical Judge Kumar presented. Mr Gershman continued to insist that the wording of the law required literal compliance with all its requirements.
Kathryn Greer argued for the vestry. Her position was that the wording of the law did not require literal compliance with all its provisions. In addition, she pointed out that members of a non-profit board such as the St Mary's vestry were volunteers who had ordinary jobs, attending board meetings in their spare time. Occasional sincere inadvertencies are inevitable, and insisting on literal compliance with every provision of the code for notifying members would produce "absurd results". This issue had been fully addressed in the trial court, and the inadvertent errors in notifying a small number of members had been counted as votes against the vestry -- but the measure still achieved the necessary supermajority. The parish secretary had made it clear in his trial testimony that there had been an honest misunderstanding.
Mr Gershman responded in his rebuttal that there was a 1923 court case in which a member of a bank's board of directors had actually been a bank robber who was on the lam and could not be located to notify him about a board meeting. As a result, the action of that board had been nullified by the court. He argued that this was a parallel case to the June 13, 2012 situation of Mrs Bush, barricaded in the parish building, not being notified of the "extraordinary" vestry meeting that took place to determine what should be done in response to Mrs Bush barricading herself in the parish building!
Since the respondents had only one chance to speak, Mr Gershman also took the opportunity to use his two-minute rebuttal to engage in character assassination against Fr Kelley, presumably knowing no reply could be made. He argued that the inadvertencies were in fact in support of a nefarious plan to seize the parish from the ACA.
Allegra Rineer, also an attorney for the vestry, gave interested parties an assessment after the arguments. She said that the appeals court must determine, first, that the trial court erred in interpreting the law, which she believed the trial court had not done. But the appeals court must also determine that, even if the trial court had erred, the error had affected the outcome of the trial, which she believed was also unlikely, since each vote was scrutinized in the trial, and any doubtful votes were counted as votes against the vestry in any case.
Mr Lengyel-Leahu, the vestry's lead attorney, also pointed to the Bush group's poor track record to date. My own reaction is that the questioning from Judges Kumar and Richardson (Judge Ricciardulli was silent) suggested they were leaning toward allowing an interpretation of "substantial compliance" on the part of the vestry. In addition, this appeal has been pursued largely as a delaying tactic by the Bush group. The fact that Mr Gershman had to resort to imputation of base motive and character assassination at the end of his argument suggests he thinks his overall case is weak.
The appeals court now has 90 days to deliver its opinion. Judge Richardson at the end of the arguments said, "Interesting case."
