Court Opinion

ID: 7844907
Source: CourtListenerOpinion
Date Created: 2022-09-08 17:08:39.708577+00
Date Added: 2024-06-11T16:21:10.123727
License: Public Domain

BERDON, J.,
dissenting. The sole issue before this court is whether this action, brought in the name of *564the plaintiff, Community Collaborative of Bridgeport, Inc. (CCB), against the defendants, Joseph P. Ganim, mayor of the city of Bridgeport (mayor), and the city council of the city of Bridgeport (city council), was authorized. The merits of the underlying complaint are not relevant to the issue before us, other than that this action was brought to preserve vital corporate interests, a fact the majority does not dispute. The court affirms the trial court’s dismissal of this action on the ground that Alma Maya, the president and cochairperson of the CCB, did not have the authority to institute the action on behalf of the CCB. In doing so, the majority stands corporate law on its head in at least two respects. First, Maya and her cochairperson, Mary McDuffie, were authorized by the CCB to bring such an action and, because the two chairpersons were deadlocked, Maya was authorized to bring it on her own authority. Second, even if Maya was not authorized to initiate this litigation, the board of directors of the CCB (board) ratified Maya’s actions.
I
Maya and her cochairperson, McDuffie, were authorized by the board, at its January 23, 1996 meeting, “to investigate and if necessary initiate legal action, including retention of legal counsel, on behalf of the Board to prevent a City of Bridgeport takeover of the federal Enterprise Community funds and process.” Although Maya, on her own, initiated this action for that purpose on behalf of the CCB, the law is clear that she had the authority to do so in order to protect vital corporate interests. The majority concedes “that Maya, as a cochairperson and a director of the board, could initiate an action on behalf of the CCB if deadlock had existed and the need for action to preserve vital corporate interests had been urgent.” See Conlee Construction Co. v. Cay Construction Co., 221 So. 2d 792, 795 (Fla. App. 1969); cf. Covington Housing Development Corp. v. *565Covington, 381 F. Sup. 427, 430 (E.D. Ky. 1974), aff'd, 513 F.2d 630 (6th Cir), cert. denied, 423 U.S. 869, 96 S. Ct. 133, 46 L. Ed. 2d 99 (1975). The trial court found that there was no deadlock between Maya and McDuffie and that there was no urgency. Although I agree with the majority that we will not upset factual findings of the trial court unless they are clearly erroneous, the undisputed facts in this case do not support the trial court’s findings.
I would find that there was a deadlock for two reasons. First, the fact that McDuffie signed a letter that gave the mayor and the city council carte blanche to take the actions passed in the city council’s resolution of February 5, 1996, which would enable the city of Bridgeport to diminish the CCB’s role in formulating its own budget — the subject matter of this litigation — points to the irrefutable conclusion that McDuffie and Maya were deadlocked. This is buttressed by the fact that Maya requested McDuffie to rescind her acquiescence in the mayor’s fiscal plans for the CCB, but McDuffie refused to do so. Second, it is undisputed that Maya then sought McDuffie’s approval to initiate this litigation, but McDuffie refused to respond. McDuffie’s refusal to rescind her signature on the letter and her subsequent silence constituted an outright disagreement with Maya over whether to initiate litigation.
As far as the need to preserve vital corporate interests is concerned, the urgency is clear because the city council’s resolution would alter the composition of the board and would diminish the board’s role in formulating its budget. It is clear that the mayor and the city council were attempting to wrestle away substantial fiscal control from the board.
I would hold that there was a deadlock, that vital corporate interests were at stake and that, based on the *566circumstances in this case, the trial court’s conclusions were clearly erroneous.
II
Notwithstanding that Maya had the authority to institute the litigation, the board implicitly ratified the bringing of this action. This court has held that “[i]f the officers or the agents of a corporation assume to act for the corporation without any authority at all, or if they exceed their authority or act irregularly, and the act is one which could have been authorised in the first instance by the stockholders, board of directors or subordinate officers, as the case may be, it may be expressly or impliedly ratified by them, and thus be rendered just as binding, except as to intervening rights of third persons, as if it had been authorized when done, or done regularly.” (Emphasis added; internal quotation marks omitted.) Cohen v. Holloways’, Inc., 158 Conn. 395, 407-408, 260 A.2d 573 (1969). Stated another way, and as applied to this case, if a corporation, with knowledge of the facts, does not repudiate litigation brought on its behalf, it thereby impliedly ratifies the action of its officer in bringing the litigation. Id., 409; see also Russell v. Dean Witter Reynolds, Inc., 200 Conn. 172, 185, 510 A.2d 972 (1986).
After this action was instituted and the defendants had filed their motion to dismiss, and after the trial court had commenced hearings on the motion, the board impliedly ratified the bringing of this action at its meeting of March 20, 1996. Maya presided over that meeting. The following excerpts from the minutes of the March 20 meeting reveals that the board was cognizant of the CCB’s pending litigation with the mayor and the city council.
The city attorney, whose office was representing the defendants in this case, had the audacity to attend the March 20 meeting in order to attempt to undermine *567Maya’s authority to bring this action on behalf of the CCB. In an attempt to adjourn the March 20 meeting before the board could discuss the litigation, the city attorney sought to appeal Maya’s ruling that there was a quorum. That appeal failed.
After a motion was made to approve the minutes of the January 23 board meeting, Rosa Correa, a director of the board, questioned whether authority was granted to the chairpersons of the CCB, which included Maya, to institute this litigation. Although Correa failed formally to move to correct the minutes of the January 23 meeting, the city attorney stated “that unless Correa’s statement is treated as a motion to correct, then [the city attorney] was making a motion to correct.”
Thereafter, the minutes of the March 20 meeting reflect the following discussion: “Christopher Caruso [a director of the board] then made a point of order. He queried whether it was [the city attorney] or [Dennis Murphy, another director of the board] who was representing the city at this meeting. If Murphy was, then he should be raising these points. Caruso added that [the city attorney] is also counsel for the City of Bridgeport. It was very important for the record to reflect that the City Attorney’s office is involved in litigation with the [CCB] in court. [Caruso] asked who was representing the city. Upon further inquiry by Maya, Murphy responded that he was representing the City at this meeting.” (Emphasis added.)
Correa’s objection to the approval of the January 23 minutes was then considered to be a motion to amend the minutes by deleting the authority to institute “legal action from the January 23, 1996 minutes.” The motion was seconded, but was defeated in a roll call vote (14 in favor, 18 against and 2 abstentions). The board then approved the January 23 minutes.
*568Thereafter, Murphy, the representative on the board from the city of Bridgeport, stated “that the vote to approve the minutes was not in keeping with [the trial court’s previous] order to maintain the status quo.” A motion to adjourn the meeting was then made and, on a roll call vote, the meeting was adjourned.
The board, at its March 20 meeting, not only defeated a motion to correct the minutes of the January 23 meeting that would have rescinded the authority to institute this action, but, also, with full knowledge that Maya instituted this litigation, impliedly ratified the bringing of this action.1
The majority colors this case with the underlying substance of the dispute — that is, an adoption of a budget by the CCB that, according to the defendants, authorized excessive amounts for the administration of the CCB. But that issue is not before this court and should not be dispositive of this appeal.
In my view, Maya, as a cochairperson of the CCB, had the authority to initiate this action because of the deadlock situation that existed with her cochairperson, McDuffie, and because of the vital corporate interests *569at stake. Even if Maya did not have the authority, however, her action was impliedly ratified by the board. Moreover, the conduct of the defendants in this case through the city attorney, with respect to the March 20 meeting, requires this court to reverse the dismissal by the trial court and to remand the matter for further proceedings.
Accordingly, I dissent.

 The majority, in response to this dissent, asserts that the ratification I depend upon was the adoption of the motion to approve the minutes of the January 23 meeting. That simply misconstrues this dissent. I rely on the March 20 meeting because the board had full knowledge of the litigation and impliedly ratified it by taking no action to disaffirm the initiation of the litigation. In a case relied upon by the majority, with respect to the law of ratification, this court adopted the rule set forth in the Restatement (Second) as follows: “We have frequently held that: Ratification is defined as the affirmance by a person of a prior act which did not bind him but which was done or professedly done on his account. Restatement (Second), 1 Agency § 82 (1958).” (Internal quotation marks omitted.) Russell v. Dean Witter Reynolds, Inc., supra, 200 Conn. 185. Implied ratification is “sometimes put upon the ground that ratification of the unauthorized act is presumed from failure to disaffirm.” (Emphasis added; internal quotation marks omitted.) Cohen v. Holloways’, Inc., supra, 158 Conn. 408. Thus, based on the undisputed facts of this case, and contrary to the majority’s conclusion, ratification is presumed.