Court Opinion

ID: 4666476
Source: CourtListenerOpinion
Date Created: 2021-03-10 16:03:58.308061+00
Date Added: 2024-06-11T08:02:49.590824
License: Public Domain

DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
                              FOURTH DISTRICT

                              MARLA SHARE,
                                Appellant,

                                      v.

                      BROKEN SOUND CLUB, INC.,
                              Appellee.

                               No. 4D20-1244

                              [March 10, 2021]

  Appeal from the Circuit Court for the Fifteenth Judicial Circuit, Palm
Beach County; Cymonie S. Rowe, Judge; L.T. Case No.
502018CA004625XXXMBAI.

   Stephen J. Padula and Joshua S. Widlansky of Padula Bennardo
Levine, LLP, Boca Raton, for appellant.

   Dale W. Schley, II and Lora A. Esau of Laing & Weicholz, P.L., Boca
Raton, and Michael C. Marsh, Ryan Roman and Eric D. Coleman of
Akerman, LLP, Miami, for appellee.

GROSS, J.

   Marla Share appeals the circuit court’s orders granting summary
judgment and entering final judgment in favor of Broken Sound Club, Inc.
(“Club”) in litigation over homeowner dues. We affirm the judgment and
write to address issues concerning the implied covenant of good faith and
the application of the business judgment rule to operational decisions of a
club board when such decisions are authorized by its bylaws. 1

1
 We reject appellant’s claim that the 2007 implementation of the Shelly Rule,
described in the opinion, was an ultra vires act. Implementation of the rule in
2007 did not require an amendment to the Club’s Bylaws. Because the Board
always had the authority to determine the amount of dues, whether the 2015
amendment purported to be retroactive is of no moment. The practical effect of
the 2015 amendment was to prospectively incorporate the Shelley Rule into the
Bylaws.
                          The Broken Sound Club

   The Club is a golf and social club located within the Broken Sound
Master Association, a residential community in Boca Raton. Organized as
a not-for-profit corporation, the Club’s purpose “is to own and operate a
private country club for the recreation, pleasure and benefit of its Members
and their guests.” All property owners within the community are required
to become members of the Club and must maintain their membership in
good standing. The Club is governed by an elected Board of Governors
(“Board”).

                  The Membership Purchase Agreement

   In 2004, Share purchased a home in the Broken Sound community and
became a member of the Club. To become a member, Share entered into
an irrevocable Membership Purchase Agreement (the “Agreement”) with
the Club, agreeing to be bound by all the “terms and conditions of the
Club’s Bylaws.”

                          Club Membership Levels

    When Share joined the Club in 2004, the Club had four categories of
membership: (1) Social; (2) Tennis; (3) Master; and (4) Old Course. Share
selected a Social membership, the least expensive level. Social members
were entitled to use (1) all of the West aquatic, social, and fitness facilities
of the Club and (2) the West golf course and tennis facilities six times each
during a membership year, upon payment of greens fees, golf cart fees,
and court fees. Tennis members had access to the same amenities as
Social members, as well as full access to the West tennis facilities. Master
members had access to the same amenities as Tennis members, as well as
full access to the West golf course. Finally, Old Course members had
access to the same amenities as Master members, as well as access to all
of the East Facilities, which included a separate golf course known as the
“Old Course.”

                                2004 Bylaws

   The 2004 Bylaws were in effect when Share signed the Agreement and
became a member of the Club.

   Under the 2004 Bylaws, the Board had the power to (1) do all acts
necessary to carry out the purposes of the Club, (2) determine the amount
of dues, fees, and other charges, (3) prepare and amend budgets, (4)
expend funds to the extent of the amount in the Club’s treasury, (5) make

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contracts, borrow money, and incur indebtedness, (6) cause promissory
notes, bonds, mortgages or other evidences of indebtedness to be executed
and issued, and (7) amend the Bylaws. Specifically, the 2004 Bylaws
contain the following relevant provisions:

      • Art. VI(1) – The Board shall “exercise all powers of the Club
      and do all acts and things necessary to carry out the purposes
      of the Club.”

      • Art. VI(2)(f) – The Board shall “determine the amount of dues,
      fees and other charges.”

      • Art. VI(2)(h) – The Board shall “have the power to prepare
      and amend budgets; to expend funds to the extent of the
      amount in the Club’s treasury or owing to the Club; to make
      contracts, borrow money and incur indebtedness for the
      purposes of the Club; and, to cause promissory notes, bonds,
      mortgages or other evidences of indebtedness to be executed
      and issued.”

      • Art. XIII(1) – “Annually, the [Board] will set the dues and fees
      to be charged in advance to members and guests for the
      ensuing membership year, which will be the twelve (12) month
      period commencing October 1 and ending the following
      September 30. The [Board] reserves the right to set the
      amount of annual dues to be payable by members at any
      level it deems appropriate.”

      • Art. XIII(2) – “All dues and fees, other than the capital
      replacement fund, will be applied against the Club’s operating
      costs. It shall be the policy of the Club that the annual and
      all other dues, plus other receipts by the Club, shall be
      sufficient, insofar as possible to project, to meet the annual
      operating needs of the Club. The annual and other dues, as
      they are established from time to time by the Board of
      Governors, shall, insofar as possible, reflect this stated
      policy.”

      • Art. XVII(2) – “The [Board] shall have the power to make
      special assessments, in addition to annual dues, to cover
      operating deficits, if any. There will be no assessments for
      capital expenditures (exclusive of the capital replacement
      fund) in excess of $500,000.00 in a single fiscal year unless a
      majority of the votes entitled to be cast are in favor of the

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      capital assessment. Assessments for capital expenditures to
      the East Facilities must be approved by a majority of the votes
      entitled to be cast by the Old Course Members and the Charter
      Members only, and shall be borne equally by such members.”

      • Art. XVIII(2) – “. . . the By-Laws may also be altered or
      amended by the [Board] at any regular or special meeting
      of the [Board] . . . .”

(Emphasis supplied).

        The General Fund and the Capital Replacement Fund

   The Club deposited all membership dues into a general fund, used to
pay all operational expenses. The Club has never maintained separate
bank accounts for each category of membership. Revenue generated from
hosting events at the Old Course facilities, including weddings and golf
tournaments, went into the general fund for the benefit of all members of
the Club. Similarly, revenue generated from leasing a cell tower on the
Old Course also went into the general fund.

   The Club also maintained a Capital Replacement Fund, used to pay any
necessary expenses associated with maintaining, renovating, and
replacing the facilities, equipment, and furnishings of the Club. Proceeds
from the sale of a parcel of land on the Old Course property were deposited
into the Capital Replacement Fund for the benefit of the Club as a whole.

                             The Shelly Rule

   When Share joined the Club in 2004, the Board apportioned dues
increases among each membership category by allocating costs to each
category. For example, under this method, increases in the operating
costs of the Old Course were charged only to Old Course Members.

  In 2007, the Board unanimously adopted a policy of charging an equal
amount of dues increases across all membership categories. This became
known as the “Shelly Rule.” 2

   Under the Shelly Rule, the Club used a graduated dues structure that
established a base “fair value” of dues for each membership category. The
lowest base amount was billed to Social Members and the highest base

2Share served on the Club’s Finance Committee when it proposed spreading the
annual dues increases equally across all membership levels.

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amount was charged to Old Course Members. Each ensuing year, the
anticipated increase in the budget was allocated equally among all
members of the Club, so that each member would pay an equal share of
the dues increase plus that member’s base “fair value” amount. The Board
adopted the Shelly Rule after performing a comprehensive study
investigating how other similarly-situated clubs set their annual dues.

    Sheldon “Shelly” Siegel, the Club’s Treasurer in 2007, attested to the
following reasons for the Shelly Rule: (1) the pre-2007 method for
calculating dues was criticized each year by some portion of the Club’s
membership; (2) the Board realized that all amenities and facilities of the
Club benefit every member; (3) it was often difficult to accurately allocate
costs to each category of membership under the pre-2007 method,
especially with costs that benefitted each level of membership; (4) it had
become increasingly difficult for the Board to reach an agreement on the
allocation of expenses on an annual basis; (5) the Shelly Rule created a
formula for setting dues that would be easy to calculate and easy to
understand; and (6) implementation of the Shelly Rule eliminated the need
to negotiate the allocation of dues increases each year.

   Following the adoption of the Shelly Rule, the Old Course Members
continued to pay higher annual dues than all the other member categories.

   The Board later amended Article VI(2)(f) of the Bylaws in March 2015
to apply the Shelly Rule beginning with the 2007-2008 fiscal year:

      The [Board] shall: Determine the amount of dues, fees and
      other charges. Beginning with the 2007-2008 fiscal year,
      Member dues for a given fiscal year will be set by adjusting
      the prior year’s dues amount for each Member equally so that
      the total amount projected to be raised by Member dues is
      equal to or greater than the amount so required by the budget
      for that fiscal year. . . .

                       The New Membership Plan

   In 2016 and 2017, the Board unanimously adopted amendments to the
Bylaws and other policy measures collectively known as the “New
Membership Plan,” which went into effect on October 1, 2017.

   The Board implemented the New Membership Plan to address concerns
facing the Club, including aging golf membership, declining golf
participation, inequities within membership classes, and an existing policy
that generally prohibited members from downgrading their membership.

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Before voting on the New Membership Plan, the Board conducted an
extensive review process with the assistance of an outside consultant. The
Board worked with the Club’s legal counsel to draft the proposed Amended
and Restated Bylaws.

   The New Membership Plan consisted of the following: (1) an equitable
upgrade and downgrade policy; (2) restructuring of dues and membership
categories; (3) sharing of all facilities; and (4) elimination of Old Course
debt.

   1. Upgrade and Downgrade Policy

   The New Membership Plan allowed members to upgrade or downgrade
their membership levels more freely. The New Membership Plan allowed
more flexibility to aging members who could no longer golf. Prior to the
New Membership Plan, the right to downgrade to a lower membership level
was limited, which discouraged new golf memberships.

   2. Restructuring of Dues to Achieve Parity

   Prior to the New Membership Plan, there were multiple dues levels
within membership categories. The New Membership Plan sought to
simplify the dues structure, correct the inequities within membership
categories, and reduce the differences between membership categories.
This became known as “parity.”

   Under the New Membership Plan, new members would join one of three
categories: Tennis, New Course (formerly Master), or Old Course. Each
category would have one price. Additionally, dues differences within a
category would disappear over time by applying scheduled annual fixed
dues increases within a membership class.

   In a December 2016 executive session, the Board determined that
Article VI(2)(f) of the Bylaws needed to be amended because “in order to
put the new membership plan into effect, the board must be empowered
to adjust dues differently for each category of membership.” Thus, the
Board determined that it was “necessary to strike the words, ‘for each
member equally,’ from the existing Bylaw.”

   In 2017, the Board also amended Bylaws to add the following language
to Article XIII, Section 2, which governed dues:

      Notwithstanding Article VI, Section 2(f) of these Bylaws, the
      Board of Governors shall have the authority to make

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      adjustments (either increases or decreases) in the dues, fees
      or other charges within any Membership Category or Class in
      order to achieve parity between Members within such
      Membership Category or Class.

    There were no intra-category parity increases for Social Members, since
all Social Members paid the same amount of dues. However, for two fiscal
years, Social Members were charged about $100 per year to create parity
between the dues paid by Social Members of the Club and the dues paid
by social members of comparable clubs. By contrast, the $100 parity
surcharge was not assessed to Old Course Members.

   3. Sharing of All Facilities

   The New Membership Plan also eliminated some of the exclusive-use
rights of the Old Course Members. Under the New Membership Plan, the
dining facilities at the Old Course became available for all members,
including Social Members. Also, the New Course Members were allowed
to play golf on the Old Course during the offseason.

   4. Elimination of Old Course Debt

   Before 2004, the Club took out a multi-million dollar loan for the
renovation of the Old Course clubhouse and golf course. The Club was
the borrower with respect to the Old Course debt, which was collateralized
by the assets of the Club as a whole. For years, the Old Course Members
were charged capital assessments of $191 per month to repay the debt.
However, as part of the New Membership Plan and in exchange for broader
use of the Old Course facilities by all members, the Board discontinued
the capital assessment of the Old Course Members. The outstanding debt
was retired by proceeds from home sales and taken out of the Club’s
“reserve funds.”

           The Litigation and Entry of Summary Judgment

   In 2017, Share stopped paying her dues and assessments. The Club
sued her for breach of contract and related claims arising out of her failure
to pay her dues.

   Share answered and asserted affirmative defenses. Share also filed a
Verified Second Amended Counterclaim, asserting two counts against the
Club: (1) a count to enjoin the ultra vires actions of the Club; and (2) a
count for breach of the implied covenant of good faith and fair dealing.
The gravamen of Share’s counterclaim was that the Club, which she

                                     7
alleged was controlled by Old Course Members, breached its contractual
duty under the implied covenant of good faith “when it unilaterally
changed the Bylaws so that it could disproportionately increas[e] her
fees/dues/assessments for her Social Membership, to the direct benefit of
Master Members and Old Course Members and to her detriment.”

   The Club moved for summary judgment as to both its complaint and
Share’s counterclaim. The Club presented undisputed evidence that
Share’s unpaid balance of dues and assessments amounted to
$63,691.16. Share did not challenge this mathematical calculation, but
argued that the Club’s breaches relieved her of the obligation to pay.

   The circuit court granted summary judgment in favor of the Club on its
claims for the unpaid balance of Share’s dues and assessments.

   The court also granted summary judgment in favor of the Club on
Share’s counterclaims. First, the court ruled that there were no genuine
issues of material fact regarding Share’s ultra vires claim because the
Club’s complained-of actions—implementing the Shelly Rule and adopting
the New Membership Agreement—were protected by the business
judgment rule and were within the scope of the Board’s authority under
the Bylaws. The trial court reasoned that the Board deliberated and acted
in good faith with respect to these decisions, and that there was no
evidence of abuse of discretion, fraud, bad faith, or illegality.

   The trial court further ruled that “the implied duty of good faith cannot
be used to vary the express terms of the Agreement, including the Bylaws.”
The court reasoned that “the Agreement between Ms. Share and the Club
expressly incorporates the Bylaws of the Club, which grants the Board the
right to make changes affecting prior rights,” and that “the Bylaws also
authorize the Board to set dues, fees and other charges and to amend the
Bylaws further.” The court pointed out that the counterclaim “does not
identify an express provision of the Agreement that Ms. Share alleges the
Club breached.”

   On appeal, Share challenges the circuit court’s rulings regarding her
counterclaims.

        The Implied Covenant of Good Faith and Fair Dealing

    “Every contract imposes an obligation of good faith and fair dealing
between the parties in its performance and its enforcement”; if the promise
“is not expressed by its terms in the contract, it will be implied.” Richard
A. Lorde, Williston on Contracts § 63:22 (4th ed. 2020); see also Ins.

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Concepts & Design, Inc. v. Healthplan Servs., Inc., 785 So. 2d 1232, 1234
(Fla. 4th DCA 2001). An “implied covenant of good faith and fair dealing
is designed to protect the contracting parties’ reasonable expectations.”
Cox v. CSX Intermodal, Inc., 732 So. 2d 1092, 1097 (Fla. 1st DCA 1999).
“As a result, the force of this obligation varies with the context in which it
arises.” Sepe v. City of Safety Harbor, 761 So. 2d 1182, 1185 (Fla. 2d DCA
2000). Therefore, the “parties’ expectations as to a responsibility that is
exercised with ‘sole discretion’ should ‘reasonably’ be more limited than
those for a responsibility that is exercised under a higher standard.” Id.

   Florida follows the majority view that “there can be no independent
cause of action brought for breach of the covenant of good faith and fair
dealing.” Williston on Contracts at § 63:22. Rather, a breach of that
covenant must be tied to the “performance of an express term of the
contract.” Hosp. Corp. of Am. v. Fla. Med. Ctr., Inc., 710 So. 2d 573, 575
(Fla. 4th DCA 1998). The implied duty of good faith “is not an abstract
and independent term of a contract which may be asserted as a source of
breach when all other terms have been performed pursuant to the contract
requirements.” Id.

   The implied duty of good faith applies “when one party has the power
to make a discretionary decision without defined standards.” Publix Super
Markets, Inc, v. Wilder Corp. of Delaware, 876 So. 2d 652, 654 (Fla. 2d DCA
2004). For example, “sole discretion does not permit a party [to a contract]
to make a discretionary decision that violates the covenant of good faith.”
Sepe, 761 So. 2d at 1185. However, where a party to a contract is vested
with discretion in the performance of a contract obligation, the covenant
of good faith is not breached unless no reasonable party in the same
position would have made the same discretionary decision. Id.; Publix
Super Markets, 876 So. 2d at 655.

   Here, the trial court did not err in granting summary judgment as to
Share’s claims and defenses related to the implied duty of good faith. As
a preliminary matter, Share misconstrues the trial court’s ruling. The trial
court did not hold that the implied duty of good faith “essentially
evaporates” if a contract gives a party discretion to make a decision.
Rather, the trial merely cited the uncontroversial proposition that the
implied covenant of good faith cannot be used to vary the terms of a
contract.

   The Agreement and Bylaws unambiguously granted the Club the
authority to set dues, fees, and other charges, as well as to amend the
Bylaws. A private club’s bylaws governing the terms of membership do
not create vested rights and are subject to amendment. See Hamlet

                                      9
Country Club, Inc. v. Allen, 622 So. 2d 1081, 1082–83 (Fla. 4th DCA 1993).
Nothing in the record shows that the Board acted outside its authority
specified in the controlling documents.

   In exercising its discretionary powers under the Agreement and Bylaws,
the Board was required to act in good faith in accordance with the duty
the law implies.

   Share argues that the Club violated the implied covenant of good faith
in the manner in which it exercised its discretionary power. Much of
Share’s argument on the implied duty of good faith centers on the Board’s
amendments to the Bylaws. Specifically, she argues that the Board
breached the implied covenant of good faith by: (1) amending the Bylaws
in an unreasonable way that favored Old Course and/or Master Course
Members to Share’s detriment; (2) amending the Bylaws in an
unreasonable way that decreased Old Course Members’ dues and fees and
increased Share’s dues and fees; (3) using the Club’s reserve funds to pay
the capital expenditures related exclusively to the Old Course Members,
in violation of the Bylaws; and (4) amending the Bylaws in a way that
resulted in Share being charged for capital expenditures and operating
costs of the Old Course and/or Master Course.

   The record establishes that the Board acted in good faith in
implementing these amendments. The record fails to demonstrate that no
reasonable club board, in the same position as the Board in this case,
would have made the same operational decisions. As we explain below,
the Board demonstrated reasonable justifications for its decisions.

    The Board’s Actions Were Neither Ultra Vires Nor Arbitrary,
                   Capricious, or in Bad Faith

   Share next argues that the trial court erred in relying on the business
judgment rule to grant summary judgment where there were genuine
issues of material fact as to whether the Club committed ultra vires acts,
breaches of the Bylaws and Agreement, and actions that were arbitrary,
capricious, or in bad faith. In particular, Share argues that it was
unreasonable for the Club to: (1) implement the Shelly Rule and
retroactively amend the Bylaws relating to the same; (2) pass the New
Membership Plan which resulted in her being obligated to pay for capital
expenditures on the Old Course facilities; and (3) pass the 2017 “parity”
amendment to the Bylaws and improperly apply the amendment so that
Old Course Members paid less. Finally, Share argues that the Club’s
amendments of the Bylaws, in and of themselves, constituted breaches of
the Agreement and ultra vires acts because there was “no express

                                   10
language in the [Agreement] stating that Ms. Share is bound by any
amendments to the Bylaws.”

   We agree with the Club that there is no genuine issue of material fact
regarding the scope of the Board’s authority or the application of the
business judgment rule. The evidence of good faith the Club presented,
coupled with Share’s failure to present any evidence of bad faith,
established that the Club’s acts were within the scope of the Club’s
authority under the Bylaws and Florida law. Applying the business
judgment rule, we defer to the Board’s decisions because they were “within
the scope of [the Board’s] authority” and were “not arbitrary, capricious or
in bad faith.” Hollywood Towers Condo. Assoc., Inc. v. Hampton, 40 So. 3d
784, 787 (Fla. 4th DCA 2010).

   An ultra vires act is an unauthorized act. Liberty Counsel v. Fla. Bar
Bd. of Governors, 12 So. 3d 183, 191 (Fla. 2009). It is one that is beyond
the scope of power granted by the corporation’s charter or bylaws. Id.

   Under the business judgment rule, “a court presumes that corporate
directors acted in good faith.” Kloha v. Duda, 246 F. Supp. 2d 1237, 1243–
44 (M.D. Fla. 2003). Absent fraud, self-dealing, criminal activity, or
betrayal of trust, directors of associations are not personally liable for the
decisions they make in their capacity as directors. See Sonny Boy, LLC v.
Asnani, 879 So. 2d 25, 27 (Fla. 5th DCA 2004); Perlow v. Goldberg, 700
So. 2d 148, 149–50 (Fla. 3d DCA 1997). The business judgment rule also
“prevents a factfinder from using hindsight to second-guess directors’
business decisions.” Kloha, 246 F. Supp. 2d at 1244. And the business
judgment rule applies to ultra vires claims against the corporation itself.
See Yarnall Warehouse & Transfer, Inc. v. Three Ivory Bros. Moving Co., 226
So. 2d 887, 892 (Fla. 2d DCA 1969).

   “While the business judgment rule traditionally applied to protect
corporate directors from personal liability in their business dealings,
courts may use the rule to evaluate the management decisions of property
associations and to avoid second-guessing those decisions.” Miller v.
Homeland Prop. Owners Ass’n, Inc., 284 So. 3d 534, 537 (Fla. 4th DCA
2019). “When applying the business judgment rule to the decisions of a
property association, the test is: 1) whether the association had the
contractual or statutory authority to perform the relevant acts; and 2) if
so, whether the board acted reasonably.” Id.

   In short, courts must give deference to an association’s decision “if that
decision is within the scope of the association’s authority and is
reasonable—that is, not arbitrary, capricious, or in bad faith.” Hampton,

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40 So. 3d at 787. Although the question of reasonableness is ordinarily
an issue of fact, a summary judgment in favor of an association should be
affirmed if the record plainly demonstrates that the association’s actions
were reasonable. Miller, 284 So. 3d at 357.

   Here, the trial court properly ruled that there were no genuine issues
of material fact regarding whether the Club committed ultra vires acts.
The underlying facts are not in dispute. It is undisputed that the Club
implemented the Shelly Rule and the New Membership Plan. It is also
undisputed that the Club made the relevant amendments to the Bylaws.
The only question is whether the record shows that the Club’s actions were
reasonable.

   We reject Share’s argument that she is not bound by the amendments
to the 2004 Bylaws. Share’s Agreement with the Club incorporated the
Club’s Bylaws by reference. Share agreed to be bound by the Club’s
Bylaws, and the Bylaws expressly state that they may be amended.
Therefore, Share is bound by the amendments to the 2004 Bylaws. See
OBS Co., Inc. v. Pace Const. Corp., 558 So. 2d 404, 406 (Fla. 1990) (“It is a
generally accepted rule of contract law that, where a writing expressly
refers to and sufficiently describes another document, that other
document, or so much of it as is referred to, is to be interpreted as part of
the writing.”).

    Share nonetheless points out that the language in her Agreement is
different from the language in the Club’s membership agreement for
Master Members, which expressly states that members agree to be bound
by the terms and conditions of the Bylaws “as they currently exist and as
they may be amended in the future.” However, this language in Master-
Member agreements regarding future amendments is superfluous, given
that the Bylaws are incorporated by reference into the agreement for
Master Members and the Bylaws expressly state that they may be
amended in the future.        That a different membership agreement
specifically mentioned future amendments to the Bylaws has no bearing
on the proper interpretation of Share’s Agreement in this case.

    Turning to the specific acts about which Share complains, the Board’s
actions were facially reasonable. First, the implementation of the Shelly
Rule in 2007 was within the Board’s authority to determine dues and was
a reasonable exercise of that power. Although Share complains that the
Shelly Rule unfairly shifted costs from Old Course Members to Social
Members, the Board’s decision was a reasonable solution to the dues issue
it confronted. The Shelly Rule split annual increases in the budget evenly
across membership classes, but Old Course Members still paid

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significantly higher base dues than Social Members. And the Shelly Rule
recognized that Social Members benefitted from revenue generated by Old
Course facilities, even if Social Members did not personally use the
facilities. Splitting annual dues increases evenly across membership
classes avoided the complexity of allocating costs to the different
membership classes and eliminated the need to negotiate dues each year.

   The implementation of the Shelly Rule was not arbitrary, capricious, or
in bad faith, so we apply the business judgment rule and defer to the
Board’s decision. It is not our role to second-guess or micromanage the
dues structure of a private club simply because a new rule for dues
increases may slightly benefit one membership class over another.

    The implementation of the New Membership Plan was also reasonable
as a matter of law. The Board undertook a deliberate process, engaging a
consultant and drafting the amendments to the Bylaws with the assistance
of counsel. Although the New Membership Plan eliminated special capital
assessments for Old Course Members, this was in exchange for the other
members receiving greater access to Old Course facilities. Moreover, the
other members were not assessed to pay for the outstanding debt, which
was already an obligation of the entire Club. Instead, the outstanding debt
was satisfied by proceeds from home sales and taken out of the Club’s
“reserve funds.” This action was within the Club’s authority to expend
funds, did not violate any Bylaws, and was a reasonable business decision.
Finally, we conclude that it was reasonable for the Club to charge Social
members a $100 “parity” fee for two years to create parity between the
dues paid by Social Members of the club and the dues paid by social
members of comparable clubs.

   We affirm the final judgment entered by the circuit court.

   Affirmed.

LEVINE, C.J., and ARTAU, J., concur.

                           *           *      *

   Not final until disposition of timely filed motion for rehearing.

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