Title: Kappa Sigma Fraternity Inc. v. Kappa Sigma Fratern
Citation: N/A
Docket Number: 022435
State: Virginia
Issuer: Virginia Supreme Court
Date: October 31, 2003

PRESENT: All the Justices 
 
KAPPA SIGMA FRATERNITY, INC. 
A/K/A KAPPA SIGMA MEMORIAL 
FOUNDATION, ET AL. 
 
v.  Record No. 022435   OPINION BY JUSTICE BARBARA MILANO KEENAN 
 
 
                          October 31, 2003 
KAPPA SIGMA FRATERNITY, ET AL. 
 
FROM THE CIRCUIT COURT OF ALBEMARLE COUNTY 
Paul M. Peatross, Jr., Judge 
 
 
 
In this appeal, the primary issue is whether a statute of 
limitations defense is applicable to bar a claim that certain 
amendments to a nonstock corporation's articles of incorporation 
are invalid. 
 
Kappa Sigma Fraternity (the Fraternity) is an 
unincorporated membership association that was founded in 1869 
at the University of Virginia.  At the time this case was heard 
in the circuit court, the Fraternity had over 158,000 alumni and 
about 215 undergraduate chapters located at colleges and 
universities in the United States and Canada.  The Fraternity is 
governed by a five-member "Supreme Executive Committee" 
(Fraternity Committee) and meets on a biennial basis at "Grand 
Conclaves" held every odd-numbered year. 
 
In 1965, the Fraternity acquired a contract right to 
purchase certain real property in Albemarle County.  The 
Fraternity planned to use the property, which was about 17 acres 
in size and contained various improvements, as the Fraternity's 
permanent headquarters and as a "perpetual memorial" to the 
Fraternity. 
 
In 1966, the Fraternity formed a nonstock corporation, 
Kappa Sigma Fraternity, Inc., a/k/a Kappa Sigma Memorial 
Foundation (the Foundation), to hold legal title to the 
property.  The Fraternity assigned its contract to purchase the 
property to the Foundation, and the Foundation acquired legal 
title to the property. 
 
At the time of purchase, the property contained a "main 
house" and a "carriage house."  The Fraternity used these 
facilities to house its administrative offices and a museum 
dedicated to the history of the Fraternity. 
 
The Foundation's original articles of incorporation stated 
that the purpose of the Foundation was "to operate an 
international fraternity and to promote friendship and brotherly 
feeling among its members."  The articles also defined the 
membership classes of the Foundation: 
(1)  ACTIVE CHAPTERS shall be those chartered by the 
Board of Directors of the corporation and shall be 
composed of four or more male persons who are students 
at some one college or university. 
 
(2)  ALUMNI CHAPTERS shall be those chartered by the 
Board of Directors of the corporation and shall be 
composed of ten or more alumni of the fraternity 
residing in or near the same locality. 
 
(3)  ALUMNI MEMBERS shall be those alumni of the 
fraternity who are not affiliated with an alumni 
chapter. 
 
2
 
 
The articles accorded each of these membership classes 
voting rights and provided that each alumni member present at 
the biennial meeting was entitled to cast one vote.  The 
articles also provided for a five-member Board of Directors (the 
Board) "elected by the vote of the members of the corporation at 
the [biennial] meeting of the corporation to be held every odd 
numbered calendar year." 
 
The Foundation's biennial meeting was intended to coincide 
with the Fraternity's biennial "Grand Conclave."  The five-
member Fraternity Committee served as the Foundation's original 
Board.  However, after 1967, the members of the Fraternity 
Committee, which were elected by the Fraternity every two years, 
and the membership of the Foundation's Board began to diverge. 
 
In 1967, the Board approved certain amendments to the 
Foundation's articles of incorporation (the 1967 amendments).  
These amendments attempted to transform the Board of Directors 
into a Board of Trustees and provided that the purpose of the 
Foundation was "to hold property, both real and personal, for 
the benefit of the Kappa Sigma Fraternity."  The 1967 amendments 
further provided that the "Trustees shall serve for life."  The 
1967 amendments were not ratified by the members of the 
Foundation. 
 
3
 
In 1974, the Board again voted to amend the Foundation's 
articles of incorporation (the 1974 amendments) to qualify the 
corporation as a charitable organization exempt from federal 
income taxes under Section 501(c)(3) of the Internal Revenue 
Code.  The 1974 amendments restated the purpose of the 
corporation as follows: 
The Corporation is organized for educational and 
charitable purposes.  It shall have the power to hold 
title to property, both real and personal.  It shall 
have the power to solicit funds, to grant 
scholarships, to conduct leadership training schools 
and to cooperate with educational, medical and other 
charitable institutions. 
 
 
The 1974 amendments provided that the "[c]orporation shall 
have no members," but these amendments were approved only by the 
Board.  The members never ratified the 1974 amendments. 
 
In the mid-1970s, the Foundation built a "training center" 
on the property to serve as a conference center.  The training 
center contained a large meeting room and dormitory space to 
house visiting members of the Fraternity and other guests.  The 
Foundation sponsored leadership conferences at the training 
center for the Fraternity's undergraduate chapters.  The 
training center also was made available for the use of other 
charitable and educational institutions. 
 
There were various "lease arrangements" between the 
Fraternity and the Foundation.  In one such arrangement, the 
Fraternity entered into a "triple net lease obligation" with the 
 
4
Foundation to lease space on the premises for the Fraternity's 
headquarters.  In exchange for its use of the property, the 
Fraternity paid all the property's maintenance costs, expenses, 
taxes, and insurance.  In addition, the Fraternity provided all 
the Foundation's administrative services and supervised the 
training facility for the Foundation. 
 
In recent years, various disputes arose between the 
Fraternity and the Foundation concerning the lease arrangement, 
the solicitation of funds for the Foundation, and the 
Foundation's use of its charitable assets.  In 1999, the 
Foundation decided to sell the real property for certain stated 
reasons, including to optimize use of the Foundation's assets 
and to comply with the Foundation's charitable purpose. 
 
In a letter transmitted in November 1999, the Foundation 
informed the Fraternity of the Foundation's decision to sell its 
real property.  In April 2001, the Foundation notified the 
Fraternity that the property had been listed for sale.  The 
Foundation sought a price of $6,500,000 for the property. 
 
The property, which is the Foundation's primary asset, had 
an appraised value of $4,500,000 at the time it was listed for 
sale.  The Foundation also holds cash and investments which 
primarily have been donated by members and alumni of the 
Fraternity. 
 
5
 
The Fraternity and three alumni, Thomas P. Bishop, Kevin S. 
Kaplan, and E.L. Betz, Jr. (the individual petitioners), filed a 
"Second Amended Bill of Complaint for Declaratory Judgment, 
Injunctive Relief, and Petition" against the Foundation and the 
individual members of its board of trustees (collectively, the 
Foundation).  The Fraternity and the individual petitioners 
(collectively, the Fraternity) asked the chancellor, among other 
things, to declare that legal title to the property was held in 
an express trust by the Foundation for the benefit of the 
Fraternity, and to place the Foundation's funds in a 
constructive trust "for the furtherance of the charitable and 
educational goals of the Fraternity." 
 
The Fraternity also asked the chancellor to declare that 
the original 1966 articles of incorporation "remain in full 
force and effect and that all subsequent amendments or 
restatements of the Articles of Incorporation are null and void" 
because those amendments and restatements were not ratified by 
the Foundation's members.  The Fraternity asked the chancellor 
to order a meeting of the Foundation's members pursuant to Code 
§ 13.1-840 for the purpose of electing new directors to the 
Foundation's board.  In response, the Foundation raised various 
affirmative defenses, including that certain statutes of 
limitation barred the Fraternity's suit. 
 
6
 
In briefs submitted to the chancellor, the Fraternity 
argued that its bill of complaint was not barred by any statute 
of limitations because "[t]he Fraternity responded promptly when 
its property rights . . . were threatened by sale and it 
discovered, (through due diligence that it previously had no 
reason to undertake), that its members had voting rights in [the 
Foundation]."  The Fraternity asserted that the Foundation "did 
not breach its trust until November 8, 1999, at the earliest," 
when the Foundation announced its intention to sell the 
property.  The Fraternity also contended that the 1967 and 1974 
amendments were void, rather than "merely voidable," because 
they were not ratified by the Foundation's members. 
 
Former Code § 13.1-236, in effect when the Board approved 
the 1967 and 1974 amendments, provided in relevant part: 
Amendments to the articles of incorporation shall be 
made in the following manner: 
 
(a)  Where there are members having voting rights, the 
board of directors shall adopt a resolution setting 
forth the proposed amendment, finding that it is in 
the best interests of the corporation and directing 
that it be submitted to a vote at a meeting of members 
having voting rights, which may be either an annual or 
a special meeting.  Notice shall be given to each 
member entitled to vote at such meeting within the 
time and in the manner provided in this Act for the 
giving of notice of such meetings of members.  The 
proposed amendment shall be adopted upon receiving 
more than two thirds of the votes entitled to be cast 
by members present or represented by proxy at such 
meeting. 
 
 
7
 
The chancellor heard the evidence ore tenus.  In a letter 
opinion, the chancellor concluded that under the articles of 
incorporation, the first two classes of membership, the "Active 
Chapters" and the "Alumni Chapters," did not exist because they 
had not been "chartered" by the Board.  However, the chancellor 
determined that the third class of membership, "Alumni Members," 
did exist because that class required no other action by the 
Board to take effect.  The chancellor thus concluded that the 
Foundation was a "membership corporation whose members consisted 
of individual alumni members not affiliated with any chartered 
alumni chapter," and found that the individual petitioners 
belonged to this third class. 
 
The chancellor determined that the 1967 and 1974 amendments 
were invalid because after they were approved by the Board, they 
were not submitted to a vote by the Foundation's members.  The 
chancellor concluded that the Foundation held the property in an 
express trust for the benefit of the Fraternity, and imposed a 
constructive trust on the Foundation's assets for the 
Fraternity's benefit.  The chancellor further determined that 
the statute of limitations and other affirmative defenses raised 
by the Foundation did not bar the Fraternity's claims. 
 
In July 2002, after the chancellor issued his letter 
opinion, Code § 2.2-507.1 became effective.  That statute 
provides: 
 
8
 
The assets of a charitable corporation 
incorporated in or doing any business in Virginia 
shall be deemed to be held in trust for the public for 
such purposes as are established by the donor's intent 
as expressed in governing documents or by other 
applicable law.  The Attorney General shall have the 
same authority to act on behalf of the public with 
respect to such assets as he has with respect to 
assets held by unincorporated charitable trusts and 
other charitable entities, including the authority to 
seek such judicial relief as may be necessary to 
protect the public interest in such assets. 
 
Thereafter, the Foundation argued that based on Code § 2.2-
507.1, the chancellor lacked jurisdiction to proceed further in 
the case because the Attorney General had not been joined as a 
necessary party. 
 
On July 22, 2002, the chancellor entered a final order 
incorporating his letter opinion and restating his ruling that 
the 1967 and 1974 amendments were "invalid and of no force and 
effect."  In the order, the chancellor also enjoined the 
trustees "from taking any actions with respect to the business 
and operations" of the Foundation. 
 
In addition, the chancellor vacated the positions of all 
existing directors and officers of the Foundation.  The 
chancellor referred the case to a commissioner in chancery to 
conduct a meeting of the Foundation's membership pursuant to 
Code § 13.1-840 for the purpose of electing new Board members.  
The chancellor ordered the commissioner "to supervise the 
business and operations" of the Foundation until the election of 
 
9
the new Board.  The chancellor also rejected the Foundation's 
argument that the Attorney General was a necessary party 
pursuant to Code § 2.2-507.1.  The Foundation appeals.1
 
Initially, the Foundation contests the chancellor's 
jurisdiction to enter the final decree of July 22, 2002, 
asserting that once Code § 2.2-507.1 became effective on July 1, 
2002, the Attorney General became a necessary party to the suit.  
We disagree with the Foundation's contention because the statute 
did not exist when this suit was filed.  In reaching this 
conclusion, we express no opinion whether the Attorney General 
is a necessary party in suits of this nature filed after July 1, 
2002. 
 
Addressing the merits of the appeal, the Foundation 
concedes that it did not comply with all requirements in 
amending its articles of incorporation in 1974.  The Foundation 
argues that, nevertheless, the Fraternity's challenge to the 
amendments was barred by the statute of limitations because the 
Board's action approving the amendments was merely voidable, 
                     
 
1 On August 31, 2002, a meeting was held pursuant to the 
chancellor's ruling at which 186 alumni members were present and 
elected a new board of directors.  However, the chancellor 
invalidated this election because of the lack of a necessary 
quorum of about 15,800 members, which number represents ten 
percent of the over 158,000 alumni members of the Foundation's 
third voting class.  The Fraternity has since filed a petition 
to dissolve the Foundation, which is presently pending. 
 
10
rather than void.2  Thus, the Foundation contends that the 
statute of limitations for challenging the Board's action began 
to run in 1974, when the amendments were adopted without 
approval by the Foundation's members, and that the limitation 
periods applicable to the Fraternity's claims were, at most, 
five years.  The Foundation therefore maintains that any claims 
by the Fraternity expired in 1979, and that the 1974 amendments 
remain in full force and effect because they were not timely 
challenged by the Fraternity. 
 
In response, the Fraternity argues that its challenge to 
the 1974 amendments is not barred by the statute of limitations.  
The Fraternity asserts that under this Court's ruling in 
Princess Anne Hills Civic League, Inc. v. Susan Constant Real 
Estate Trust, 243 Va. 53, 413 S.E.2d 599 (1992), a voidable 
corporate act becomes null and void unless it is properly 
ratified.  Thus, the Fraternity contends that the 1974 
amendments are null and void because they were never ratified by 
a vote of the Foundation's members.  We disagree with the 
Fraternity's arguments. 
 
We first note that the form of the present litigation, 
which is a declaratory judgment suit, does not affect our 
analysis of the statute of limitations.  The applicability of 
                     
 
2 Based on our holdings below, we address only the adoption 
of the 1974 amendments and need not consider the adoption of the 
 
11
the statute of limitations is governed by the object of the 
litigation and the substance of the complaint, not the form in 
which the litigation is filed.  See Board of Supervisors v. 
Thompson Assocs., 240 Va. 133, 139, 393 S.E.2d 201, 204 (1990); 
Friedman v. Peoples Serv. Drug Stores, Inc., 208 Va. 700, 703, 
160 S.E.2d 563, 565 (1968); see also Johnson v. Davis, 582 F.2d 
1316, 1318 (4th Cir. 1978).  "If the law were otherwise, the 
statute of limitations could be rendered meaningless merely by 
the filing of a declaratory judgment action."  Thompson Assocs., 
240 Va. at 139, 393 S.E.2d at 204.  Therefore, we will not 
permit a complainant to use the declaratory judgment statute as 
a vehicle to circumvent the statute of limitations applicable to 
the substance of a complaint.  See id. at 139, 393 S.E.2d at 
204-05. 
 
Next, we observe that the Fraternity's reliance on our 
holding in Princess Anne Hills Civic League is misplaced.  
There, the statute of limitations was not asserted as a defense 
to the challenged corporate act.  We were asked to decide 
whether a deed purportedly executed by a nonstock corporation 
was void because it had been executed by the corporation's 
president without the required approval of the board of 
directors and the vote of the corporation's members.  243 Va. at 
55-57, 413 S.E.2d at 601-02.  We held that because execution of 
                                                                  
1967 amendments. 
 
12
the deed was within the powers conferred upon the corporation by 
the General Assembly, but the corporation failed to do properly 
that which it had the power to do, the corporate action 
executing the deed was voidable, rather than void.  Id. at 61, 
413 S.E.2d at 604.  In the absence of a statute of limitations 
defense, we further held that the corporate act was subject to 
challenge and that the deed was null and void because the 
corporation had not complied with all statutory requirements.  
Id. at 62, 413 S.E.2d at 604. 
 
Here, because the Foundation has asserted a defense of the 
statute of limitations, we must determine whether that defense 
bars consideration of the Fraternity's challenge to the 
Foundation's corporate action adopting the 1974 amendments.  We 
begin by reviewing the relevant powers of a nonstock 
corporation. 
 
Under Code § 13.1-884(A), a nonstock corporation is 
empowered to "amend its articles of incorporation at any time to 
add or change a provision that is required or permitted in the 
articles."  A similar provision appeared in former Code § 13.1-
235, which was in effect in 1974 when the Board adopted the 
challenged amendments.  Under that section, a corporation was 
authorized to "amend its articles of incorporation . . . in any 
and as many respects as may be desired, so long as its articles 
 
13
of incorporation as amended contain only such provisions as are 
lawful under this Act."  Id.
 
The 1974 amendments to the Foundation's articles of 
incorporation reflected changes in the Foundation's statement of 
purpose and the provisions regarding its membership.  Because 
these provisions plainly were permitted subjects for amendment 
under former Code § 13.1-235, the Foundation had the power to 
make such changes to its articles. 
 
The Foundation did not comply with the statutory 
requirements necessary for approval of the 1974 amendments.  
Under former Code § 13.1-236(a), amendment of the Foundation's 
articles of incorporation required approval of more than two-
thirds of all votes entitled to be cast by the members present 
at an annual or special meeting held in conformance with the 
other statutory requirements.  However, because adoption of the 
1974 amendments was within the Foundation's power conferred by 
statute, the Board's approval of those amendments was a 
voidable, rather than a void, act of the corporation.  See 
Princess Anne Hills Civic League, 243 Va. at 61; 413 S.E.2d at 
604; Winston v. Gordon, 115 Va. 899, 905-06, 80 S.E. 756, 759 
(1914); see also Michelson v. Duncan, 407 A.2d 211, 218-19 (Del. 
1979). 
 
We hold that a challenge to a voidable corporate act is 
subject to a defense of the statute of limitations.  A contrary 
 
14
conclusion is untenable because it would require us to assume, 
in the absence of any authority, that the General Assembly 
intended to render innumerable corporate transactions, 
imperfectly executed but within a corporation's power to act, 
subject to attack in perpetuity.  In addition, such a conclusion 
would blur the bright line presently existing between an ultra 
vires act, in which a corporation lacks power to act, and a 
voidable act, which is within the lawful scope of a 
corporation's power.  See Code § 13.1-828; see also Norton 
Grocery Co. v. Peoples Nat'l Bank of Abingdon, 151 Va. 195, 202-
03, 144 S.E. 501, 502-03 (1928).  Thus, we conclude that the 
Fraternity's challenge is subject to the statute of limitations, 
and we will consider the substance of the claim asserted to 
determine whether it is time-barred.  See Thompson Assocs., 240 
Va. at 139, 393 S.E.2d at 204; Friedman, 208 Va. at 703, 160 
S.E.2d at 565; see also Johnson, 582 F.2d at 1318. 
 
If we consider the Fraternity's claim challenging the 1974 
amendments as alleging breach of a contract between the 
Fraternity and the Foundation, or breach of a contract between 
the Foundation and the individual petitioners, either claim is 
barred by the five-year limitation period of former Code § 8-13, 
because the alleged injury occurred in 1974 and the present suit 
 
15
was filed in 2001.3  "It is a well-established principle 
uniformly acted upon by courts of equity, that in respect to the 
statute of limitations equity follows the law; and if a legal 
demand be asserted in equity which at law is barred by statute, 
it is equally barred in equity."  Belcher v. Kirkwood, 238 Va. 
430, 433, 383 S.E.2d 729, 731 (1989)(quoting Sanford v. Sims, 
192 Va. 644, 649, 66 S.E.2d 495, 498 (1951)). 
 
Alternatively, if we view the Fraternity's challenge to the 
1974 amendments as alleging that the Foundation's directors 
breached a fiduciary duty owed to Kappa Sigma Fraternity and to 
the individual petitioners as corporate members, both those 
claims likewise are time-barred by the five-year "catch-all" 
provision of former Code § 8-24.4   See Singer v. Dungan, 45 F.3d 
823, 827 (4th Cir. 1995); Federal Deposit Ins. Corp. v. Cocke, 7 
F.3d 396, 401-02 (4th Cir. 1993).  Accordingly, we hold that the 
Fraternity's claims attacking the validity of the 1974 
amendments are barred by the statute of limitations, and that 
the chancellor erred in reaching a contrary conclusion.5
                     
 
3 We do not express an opinion concerning the legal 
sufficiency of such a contract claim. 
 
4 We express no opinion regarding the legal sufficiency of 
such a claim of breach of fiduciary duty.  We also observe that 
the present version of the "catch-all" provision found in Code 
§ 8.01-248 fixes a two-year statute of limitations. 
 
5 We disagree with the Foundation's suggestion that the 
claim of the individual petitioners also could be viewed as 
alleging injury to a property right, based on the denial of the 
petitioners' right to vote set forth in the Foundation's 
 
16
 
We next consider the Foundation's argument that the 
Fraternity's assertion of an express trust, and its accompanying 
request that a constructive trust be imposed on the Foundation's 
funds, also are time-barred.  The Foundation contends that the 
limitation period for a claim involving an express trust is five 
years, whether the claim is based on an injury to property or on 
the breach of a written contract.  The Foundation thus argues 
that the limitation period on the express trust claim began to 
run in 1974 because the 1974 amendments were an open and express 
repudiation of the alleged trust.  The Foundation further 
contends that the Fraternity's request that a constructive trust 
be imposed on the Foundation's funds likewise is barred by the 
five-year statute of limitations, because any claim to the 
Foundation's funds accrued when the Foundation transferred its 
assets to a charitable corporation exempt from federal taxation 
for the benefit of the public. 
 
In response, the Fraternity argues that it timely asserted 
its claim of an express trust and request for a constructive 
trust.  The Fraternity asserts that it was the beneficial owner 
of the property before and after the 1974 amendments went into 
effect and that those amendments, which merely changed the 
Foundation's tax status, did not constitute a repudiation of the 
                                                                  
articles of incorporation.  Members of a nonstock corporation do 
not have vested property rights based on any provision in the 
 
17
express trust.  The Fraternity contends that the Foundation's 
"fraud" in attempting to enact the 1974 amendments precludes the 
Foundation from asserting the statute of limitations as a 
defense.  The Fraternity further contends that its request for a 
constructive trust was not time-barred because the Foundation's 
failure to use the donated funds for their intended purpose 
represented a continuing violation of the Foundation's 
obligation to its donors.  We disagree with the Fraternity's 
arguments. 
 
The 1974 amendments, which remain in full force and effect, 
committed the Foundation's assets for the benefit of the public.  
J. Robert Mahoney, who then was Secretary-Treasurer of the 
Foundation and Executive Director of the Fraternity, 
acknowledged the effect of this change in the Foundation's 
status and purpose in a written statement he made in 1974 to the 
Director of the United States Internal Revenue Service.  Mahoney 
stated that the new charitable foundation "will not serve any 
private benefit of or for Kappa Sigma Fraternity. . . .  All 
alumni contributions to [the Foundation] will be used only for 
public charitable purposes and not for the private use of Kappa 
Sigma Fraternity." 
 
We hold that this declaration of fundamental change in the 
Foundation's status and purpose constituted a repudiation of any 
                                                                  
corporation's articles.  Code § 13.1-884(B). 
 
18
express trust maintained by the Foundation for the benefit of 
the Fraternity.  The statute of limitations begins to run on a 
claim of express trust when the trustee denies or repudiates the 
trust and the trust beneficiary has actual or constructive 
notice of this denial or repudiation.  Russell v. Passmore, 127 
Va. 475, 511, 103 S.E. 652, 664 (1920); see Wiglesworth v. 
Taylor, 239 Va. 603, 608, 391 S.E.2d 299, 303 (1990); Broaddus 
v. Gresham, 181 Va. 725, 734, 26 S.E.2d 33, 36 (1943).  Because 
such action by the trustee is an abandonment of the existing 
fiduciary character of the trustee's relationship to the trust 
property, the statute begins to run based on the trustee's 
action and notice, unless the trustee has committed a fraud with 
regard to the giving of notice.  Russell, 127 Va. at 511; 103 
S.E. at 664. 
 
In the present case, the chancellor did not find that the 
Foundation was guilty of any fraudulent conduct regarding notice 
to the Fraternity of the Foundation's change in purpose and 
repudiation of its former status holding property for the 
benefit of the Fraternity.  As Mahoney's statement indicates, 
the Fraternity had notice of the proposed change in the 
Foundation's status and the Foundation's effective repudiation 
of any alleged trust relationship for the benefit of the 
Fraternity.  Therefore, any claim of express trust against the 
Foundation began to run in 1974, when the repudiation occurred.  
 
19
Accordingly, whether the express trust claim brought by the 
Fraternity is construed as being based on breach of contract, on 
injury to property, or on breach of fiduciary duty, the 
Fraternity's claim was time-barred when this suit was filed in 
2001.  See former Code §§ 8-13 and -24.6
 
We also hold that the chancellor erred in imposing a 
constructive trust on the Foundation's assets.  Because the 
Fraternity's challenge to the 1974 amendments and its claim of 
an express trust were time-barred, the 1974 amendments remain in 
full force and effect and the chancellor lacked any basis for 
imposing a constructive trust on these assets.7
 
The Foundation next argues that the chancellor did not have 
authority to vacate the positions of its directors and corporate 
officers.  The Foundation also asserts that the chancellor erred 
in appointing a commissioner in chancery to manage the 
Foundation's assets and operations because Code § 13.1-910, 
which sets forth a court's authority to place a corporation in 
receivership, applies only in a proceeding to dissolve the 
corporation. 
                     
 
6 The present versions of these statutes are found in Code 
§§ 8.01-243, -246, and –248. 
 
7 Because the Fraternity's challenges to the 1974 amendments 
are time-barred, its challenges to the 1967 amendments, which 
are substantively the same as the challenges to the later 
amendments, necessarily are time-barred as well. 
 
20
 
In response, the Fraternity asserts that the chancellor's 
actions were proper under Code § 13.1-840(B), which authorizes a 
court to enter "orders necessary to accomplish the purpose or 
purposes of the [court-ordered] meeting."  According to the 
Fraternity, this provision empowered the chancellor to vacate 
the positions of the Foundation's officers and directors and to 
appoint a commissioner in chancery to conduct the meeting and to 
supervise the Foundation's affairs.  We disagree with the 
Fraternity's arguments. 
 
The language of Code § 13.1-840 specifies the authority of 
a circuit court to order an annual or special meeting of a 
nonstock corporation.  This authority includes calling the 
meeting, fixing its time and place, prescribing the form and 
content of the meeting notice, and specifying a record date for 
determining which members are entitled to notice of the meeting 
and to vote.  Id.  Because the additional statutory language, 
authorizing the court to "enter other orders necessary to 
accomplish the purpose or purposes of the meeting," is general 
in its terms, we consider that language pursuant to the doctrine 
of ejusdem generis. 
 
Under this doctrine, when items with a specific meaning are 
listed together in a statute, and are followed by words of 
general import, the general words will not be construed to 
include matters within their broadest scope but only those 
 
21
matters of the same import as that of the specific items listed.  
Turner v. Reed, 258 Va. 406, 410, 518 S.E.2d 832, 834 (1999); 
Wood v. Henry County Pub. Schs., 255 Va. 85, 94, 495 S.E.2d 255, 
260 (1998).  Therefore, we hold that the general language quoted 
above refers to matters of procedure related to organizing and 
conducting a court-ordered meeting and did not empower the 
chancellor to assume the role of the corporate members and take 
action removing the Foundation's officers and directors from 
their official positions. 
 
We further observe that under Code § 13.1-857(E), a 
director continues to serve "until his successor is elected and 
qualifies or until there is a decrease in the number of 
directors."  Because neither of these events had occurred when 
the chancellor entered the challenged order, his decision 
vacating the terms of the Board members was erroneous for this 
additional reason. 
 
We also conclude that the chancellor erred in appointing a 
commissioner in chancery to take control of the Foundation's 
operations and assets.  Under Code § 13.1-910(A), a court's 
authority to appoint a receiver to conduct the business of a 
corporation is limited to a "judicial proceeding brought to 
dissolve a corporation."  See Commonwealth v. JOCO Found., 263 
Va. 151, 162, 558 S.E.2d 280, 285 (2002).  Because the 
Fraternity did not seek a dissolution of the Foundation in these 
 
22
proceedings, the appointment of a commissioner to serve the 
function of a receiver, as well as the commissioner's actions 
pursuant to that appointment, must be vacated.8  See id.
 
For these reasons, we will reverse the circuit court's 
judgment, vacate the court's appointment of a commissioner in 
chancery to serve the function of a receiver and the 
commissioner's actions taken pursuant to that appointment, and 
enter final judgment in favor of the Foundation. 
 
 
 
 
 
 Reversed, 
 
 
 
 
 
 vacated in part, 
and final judgment.
                     
 
8 Based on our several holdings in this case, we need not 
address the Foundation's arguments relating to estoppel and 
waiver. 
 
23