Young Lawyers Division
No trespassing: donors lack legal standing to challenge corporate acts of Florida not-for-profit Corporations.
It is a well-established corporate law principle that a director of a not-for-profit corporation must serve the corporation in good faith and in a manner he or she reasonably believes to be in the best interests of the corporation. (1) Imagine, however, if each time the NFP's board of directors attempted to make and implement a corporate decision, various people claiming to have made charitable contributions to the corporation were allowed to second-guess those business decisions and challenge governance activities of the NFP's officers and directors.Fortunately, the Florida Legislature has provided, and Florida courts have readily affirmed, a long-held principle that donors cannot journey into that area of NFP governance and decisionmaking, and have no right to seek such standing from Florida courts under any theory merely because of their donor status. The Florida Not-for-Profit Corporation Act, F.S. Ch. 617 requires courts to apply not-for-profit corporation law principles, an...