Court Opinion

ID: 9697016
Source: CourtListenerOpinion
Date Created: 2023-08-25 19:04:01.78415+00
Date Added: 2024-06-11T18:20:28.571373
License: Public Domain

ZAPPALA, Justice,
concurring.
I concur in the result. In my view the issue of privilege should not be addressed by this Court because it was not raised before the common pleas court or preserved for appeal.
I would hold that on this record the documents requested are not “records of the proceedings”1 such that members of the Pennsylvania Bar Association are entitled to inspect them under 15 Pa.C.S. § 5508(b).
The Appellees assert that they are entitled to inspect all of the documents requested in their demand letter dated February 17, 1997. The Nonprofit Corporation Law of 1988 identifies the types of records that a nonprofit corporation is required to keep.
Every nonprofit corporation shall keep an original or duplicate record of the proceedings of the members and the directors, and of any other body exercising powers or performing duties which under this article may be exercised or performed by such other body, the original or a copy of *480its bylaws, including all amendments thereto to date, certified by the secretary of the corporation, and an original or a duplicate membership register, giving the names of the members, and showing their respective addresses and the class and other details of the membership of each. Every such corporation shall also keep appropriate, complete and accurate books or records of account. The records provided for in this subsection shall be kept at either the registered office of the corporation in this Commonwealth or at its principal place of business wherever situated.
15 Pa.C.S. § 5508(a).
In summary, a nonprofit corporation is required to keep a record of the proceedings of the members, directors and any other body as defined in the statute, as well as a membership register, and books or records of account. The corporate records required to be kept under § 5508(a) are the identical records that a member has the right to inspect pursuant to 15 Pa.C.S. § 5508(b). The statute does not define “record of the proceedings,” but it is apparent from the context of the statute that the phrase refers to a memorialization of official action taken by the members, directors and any other body of the nonprofit corporation. This is much more limited than the interpretation suggested by the Appellees’ argument, which would encompass all documents that came into existence during the process of preparing for the evaluation of judicial candidates.
Limiting the scope of records of proceedings subject to inspection is consistent with the historical development of the shareholder’s right of inspection. In Goldman v. Trans-United Industries, Inc., 404 Pa. 288, 171 A.2d 788 (1961), we observed that the right of a shareholder to inspect the books and records of account of a corporation had been recognized at common law. The common law rule was later codified as part of the Business Corporation Law of May 5, 1933. Section 308(B) of that early law provided that a shareholder had the right to examine the share register, books or records of account, and records of the proceedings of the shareholders and directors.
*481Absent throughout the development of the shareholder’s right of inspection is any precedent that would support the Appellees’ expansive interpretation of such right. In the context of both business and nonprofit corporations, the courts have recognized that a shareholder or member is entitled to inspect documents such as membership lists, financial records, audit reports and minutes of meetings. See, e.g., Goldman, supra; Kuhbach v. Irving Cut Glass Co., 220 Pa. 427, 69 A. 981 (1908); Hurst v. Shaw, 121 Pa.Cmwlth. 1, 549 A.2d 1849 (1988).
The shareholder’s right of inspection under common law was not an absolute right. In Strassburger v. Philadelphia Record Company, 335 Pa. 485, 6 A.2d 922 (1939), a shareholder, who had been elected as a director, filed a petition for a writ of peremptory mandamus to obtain inspection of corporate books and records and also sought injunctive relief. The shareholder asserted that the corporation had refused to permit him to examine the books of account, minute books and other records and documents of the corporation. The requests for a preliminary writ and an injunction were denied by the lower court.
On appeal, this Court addressed the differences between the relationship of a shareholder to the corporation and that of a director. We noted that a director stands in a fiduciary relationship to the corporation and, therefore, is entitled to all the information available to enable him to perform his duties to the shareholders. We found that the Business Corporation Law of 1933 “did not limit him, in the examination, as it limited the stockholder” whose right extended only to inspection of the share register, books or records of account, and records of the proceedings of the shareholders and directors. Since the phrase “records of proceedings” also appears in 15 Pa.C.S. § 5508(b), this analysis undercuts Appellees’ argument that they were entitled to all the documents they had requested.2
*482For these reasons, I would reverse the order of the court of common pleas.
NEWMAN, J., joins in this concurring opinion.

. For purposes of this Opinion, I assume without deciding that the Judicial Evaluation Commission is an "other body” within the definition of 15 Pa.C.S. § 5103.

. The Appellees attempt to distinguish this case from Strassburger because § 5508(b) includes a right to inspect the records of proceedings of an other body of the nonprofit corporation. The Appellees argue that *482by statute, the members of a nonprofit corporation have been granted broader powers than shareholders of a for-profit corporation. Although § 5508(b) extends to an other body of a nonprofit corporation, it does not expand the categories of documents that may be inspected by a member. Records of proceedings were included in the 1933 version of the Business Corporation Law and the same language appears in the Nonprofit Corporation Law of 1988.