CHARTER OAK HEALTH CENTER, INC., ET AL. v. VERONICA BARCELONA ET AL.
(AC 47732)
Appellate Court of Connecticut
September 2, 2025
Suarez, Clark and Westbrook, Js.
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Syllabus
The plaintiff nonstock corporation and five individual plaintiffs in their capacity as members of the corporation‘s board of directors and on the corporation‘s behalf appealed from the trial court‘s judgment dismissing their action against the defendants, three members of the corporation‘s board of directors, for lack of subject matter jurisdiction on the basis that the individual plaintiffs lacked standing to bring the action. The plaintiffs claimed that the court improperly dismissed the action, which sought declaratory and injunctive relief pursuant to the Connecticut Revised Nonstock Corporation Act (
The trial court improperly dismissed the plaintiffs’ action for lack of subject matter jurisdiction, as the individual plaintiffs were aggrieved persons within the meaning of
Argued June 4—officially released September 2, 2025
Action for injunctive and declaratory relief with respect to the corporate governance of the named plaintiff and the validity of certain actions of its board of directors, brought to the Superior Court in the judicial district of Hartford and transferred to the Complex Litigation Docket, where Joel Cruz et al. were added as plaintiffs; thereafter, the court, Noble, J., granted the defendants’ motion to dismiss and rendered judgment thereon, from which the plaintiffs appealed to this court. Reversed; judgment directed; further proceedings.
Patrick M. Fahey, for the appellants (plaintiffs).
Linda L. Morkan, with whom were Kathleen E. Dion and, on the brief, Jenna M. Scoville, for the appellees (defendants).
Opinion
WESTBROOK, J. In this corporate governance dispute, the plaintiffs, Charter Oak Health Center, Inc. (Charter Oak), and Adrian Wood, Joel Cruz, Martin John, Eileen Alvarado, and Leslie Arroyo, in their capacity as members of the board of directors of Charter Oak and on behalf of Charter Oak, appeal from the judgment of the trial court dismissing their action against the defendants, Veronica Barcelona, Claudius McNish, and Lolita Young, for lack of subject matter jurisdiction on the basis that the individual plaintiffs lacked standing to bring the action. The plaintiffs claim that the court improperly dismissed the action because the individual plaintiffs have standing pursuant to General Statutes
The following facts, as alleged by the plaintiffs and stipulated to by the parties, and procedural history are relevant to this appeal. Charter Oak is a federally qualified health center that serves underserved areas by providing outpatient primary care, specialty medical services, behavioral health services, and dental services. On
Six days later, on November 21, 2023, Evans sent emails to Wood, Cruz, and John, each containing a letter stating that, “pursuant to Charter Oak‘s bylaws [he or she] had exceeded the six year term limit for service on the board of directors.”2 Later that day, Evans called Hardy and expressed her view that Wood, Cruz, and John “had been on the board for too long and were no longer board members.” Evans asked Hardy to participate in a “shadow board meeting” the next day to elect a new chairperson of the board, but Hardy, believing that Wood, Cruz, and John were still legitimate members of the board of directors, “refused to participate in the board meeting. . . .” Despite Hardy‘s disagreement, Evans scheduled a meeting for the next day.
After her conversation with Evans, Hardy informed Wood that Markello, Evans, and Timothy Powers, Charter Oak‘s vice president of corporate compliance, were “trying to seize control of the board of directors by assembling a rogue board and electing a new chairperson and [chief executive officer (CEO)].” In response, Wood, Cruz, John, and Hardy held a meeting and voted to offer a permanent position to Thomas Maynor, Charter Oak‘s interim CEO, and to suspend Markello, Evans, and Powers. They also voted to remove the term limit provision from Charter Oak‘s bylaws. The next day, on November 22, 2023, Maynor emailed letters to Markello, Evans, and Powers, informing them that they had been suspended.
Later that day, the defendants held a meeting at which Evans and Markello also were present. After the meeting, Markello sent an email to all Charter Oak staff, stating in relevant part: “Five of our board members had their terms expire according to our bylaws, and so they are no longer on the board. They are [the individual plaintiffs]. . . . The four remaining board members, [the defendants and Hardy] currently make up our board, however, they plan to add new board members in the near future. Three of the four remaining members of the board held a duly authorized board meeting today and voted the following: 1. To elect . . . Barcelona as the new chair. 2. To suspend the CEO search and engage a professional search firm. 3. To appoint me . . . Markello, the new interim CEO.” Markello subsequently used his authority as the new interim CEO to terminate several of Charter Oak‘s existing consulting contracts, as well as Maynor‘s interim CEO contract. The board
On November 27, 2023, Wood, in his capacity as a member of the board of directors of Charter Oak and on behalf of Charter Oak, filed a one count complaint against the defendants, seeking injunctive relief pursuant to the Connecticut Revised Nonstock Corporation Act, General Statutes
On December 4, 2023, the defendants filed a motion to dismiss Wood‘s complaint for lack of subject matter jurisdiction. They argued that, pursuant to Charter Oak‘s bylaws, Wood ceased being a board member upon the expiration of his third consecutive term, and, therefore, he lacked standing to bring the action on behalf of Charter Oak. Wood filed an opposition to the defendants’ motion to dismiss, arguing that he has standing to bring the action on behalf of Charter Oak because, pursuant to General Statutes
waived the term limit provision of its bylaws. In support of his opposition, Wood attached the meeting minutes from the board‘s annual meetings on October 26, 2022, and October 23, 2019. The defendants filed a reply, arguing that, pursuant to General Statutes
On December 28, 2023, the court, Bellis, J., issued an order transferring the case to the complex litigation docket. On January 12, 2024, pursuant to Practice Book § 10-59, Wood filed an amended complaint in which he added as plaintiffs Cruz, John, Alvarado, and Arroyo, the other Charter Oak board members who allegedly were wrongfully removed.5 On February 23, 2024, pursuant to Practice Book § 10-60, the plaintiffs moved for
leave to file a second amended complaint. The trial court granted that request over the defendants’ objection.6
On January 26, 2024, the parties filed a stipulation regarding the dates that the individual plaintiffs, the defendants, and Hardy served on Charter Oak‘s board of directors. The stipulation provides that (1) between 2012 and 2023, John was elected and reappointed to serve seven consecutive terms; (2) between 2013 and 2023, Wood was elected and reappointed to serve six consecutive terms; (3) between 2013 and 2023, Cruz was elected and reappointed to serve six consecutive terms; (4) between 2014 and 2022, Arroyo was elected and reappointed to serve five consecutive terms; (5) between 2016 and 2022, Alvarado was elected and reappointed to serve four consecutive terms; (6) between 2019 and 2022, McNish and Young were elected and reappointed to serve three consecutive terms; (7) on August 23, 2023, Barcelona was elected to serve her first term; and (8) on October 25, 2023, Hardy was elected to serve her first term. The stipulation additionally provides that John, Wood, and Cruz had been elected and reappointed to serve two year terms on October 25, 2023, and Arroyo and Alvarado had been elected and reappointed to serve two year terms on October 26, 2022.
Following a remote hearing,7 on May 28, 2024, the court, Noble, J., issued a memorandum
The court then determined that, pursuant to Charter Oak‘s bylaws, the individual plaintiffs were no longer members of the board of directors. It stated: “The court finds that, under the bylaws, the [individual] plaintiffs are no longer members because they have exceeded the bylaws’ term limits. Under article four, § 2, of Charter Oak‘s bylaws, after the [individual] plaintiffs completed their first three consecutive terms, they were no longer eligible to be members of the board of directors. They therefore lack standing to assert claims concerning Charter Oak‘s corporate governance on their own behalf and, as former board members, have no authority to initiate a lawsuit on Charter Oak‘s behalf.” (Footnote omitted.) The court further determined that “this application of the bylaws would not result in absurd or unworkable results” because the bylaws allow the board of directors to call special meetings to add members so that it may maintain nine directors as required by the bylaws. The court also found that the staggered nature of the directors’ terms “is designed to prevent the board from lacking [a] quorum and the requisite number of directors.”
The court next addressed the plaintiffs’ argument that Charter Oak had waived the term limit provision of its bylaws. In rejecting that argument, the court stated: “[T]he plaintiffs have not put forth any evidence beyond the mere assertion that these provisions were waived to demonstrate that the board of directors actually intended to waive the term limitations as set forth in the bylaws. Therefore, the plaintiffs have failed to satisfy their burden of proving subject matter jurisdiction . . . Moreover . . . the bylaws could have been amended . . . to remove the term limitations had it actually been the intention of the board of directors to remove term limits. . . . The actions taken by the [individual] plaintiffs on November 21, 2023, to remove the term limitation provision are not valid because they
were no longer members in good standing of the board of directors.”
The court concluded: “[T]he [individual] plaintiffs lack standing because they are no longer board members pursuant to article four, § 2, of the bylaws, which varies permissibly from
On appeal, the plaintiffs claim that the court improperly dismissed their action for lack of subject matter jurisdiction because the individual plaintiffs have standing pursuant to
argue that the individual plaintiffs are aggrieved within the meaning of that statute and are entitled to a determination of their rights to hold office. We agree.
We begin by setting forth the relevant legal principles and standards that govern our review of this claim. “A motion to dismiss tests, inter alia, whether, on the face of the record, the court is without jurisdiction. . . . [O]ur review of the court‘s ultimate legal conclusion and resulting [determination] of the motion to dismiss will be de novo. . . . In undertaking this review, we are mindful of the well established notion that, in determining whether a court has subject matter jurisdiction, every presumption favoring jurisdiction should be indulged. . . .”
“Our courts have acknowledged that [t]rial courts addressing motions to dismiss for lack of subject matter jurisdiction . . . may encounter different situations, depending on the status of the record in the case. . . . [L]ack of subject matter jurisdiction may be found in any one of three instances: (1) the complaint alone; (2) the complaint supplemented by undisputed facts evidenced in the record; or (3) the complaint supplemented by undisputed facts plus the court‘s resolution of disputed facts. . . . Different rules and procedures will apply, depending on the state of the record at the time the motion is filed. When a trial court decides a jurisdictional question raised by a pretrial motion to dismiss on the basis of the complaint alone, it must consider the allegations of the complaint in their most favorable light. . . . In this regard, a court must take the facts to be those alleged in the complaint, including those facts necessarily implied from the allegations, construing
“In contrast, if the complaint is supplemented by undisputed facts established by affidavits submitted in
support of the motion to dismiss . . . [or] other types of undisputed evidence . . . the trial court, in determining the jurisdictional issue, may consider these supplementary undisputed facts and need not conclusively presume the validity of the allegations of the complaint. . . . Rather, those allegations are tempered by the light shed on them by the [supplementary undisputed facts]. . . . If affidavits and/or other evidence submitted in support of a defendant‘s motion to dismiss conclusively establish that jurisdiction is lacking, and the plaintiff fails to undermine this conclusion with counteraffidavits or other evidence, the trial court may dismiss the action without further proceedings. . . .”
“It is a basic principle of law that a plaintiff must have standing for the court to have jurisdiction. . . . Standing is the legal right to set judicial machinery in motion. . . . One cannot rightfully invoke the jurisdiction of the court unless he [or she] has, in an individual or representative capacity, some real interest in the cause of action, or a legal or equitable right, title or interest in the subject matter of the controversy. . . . When standing is put in issue, the question is whether the person whose standing is challenged is a proper party to request an adjudication of the issue . . . .” (Citations omitted; internal quotation marks omitted.) Fountain of Youth Church, Inc. v. Fountain, 225 Conn. App. 856, 867-69, 317 A.3d 106 (2024).
“Standing is not a technical rule intended to keep aggrieved parties out of court; nor is it a test of substantive rights. Rather it is a practical concept designed to ensure that courts and parties are not vexed by suits brought to vindicate nonjusticiable interests and that judicial decisions which may affect the rights of others are forged in hot controversy, with each view fairly and vigorously represented. Importantly, [o]ur standing jurisprudence consistently has embodied the notion
that there must be a colorable claim of a direct injury to the [complaining party], in an individual or representative capacity. . . . Standing focuses on whether a party is the proper party to request adjudication of the issues, rather than on the substantive rights of the aggrieved parties.” (Citation omitted; internal quotation marks omitted.) Pasciolla v. Pasciolla, 230 Conn. App. 174, 182, 330 A.3d 222 (2025).
“It is axiomatic that aggrievement is a basic requirement of standing, just as standing is a fundamental requirement of jurisdiction. . . . There are two general types of aggrievement, namely, classical and statutory; either type will establish standing, and each has its own unique features.” (Internal quotation marks omitted.) Perry v. Perry, 312 Conn. 600, 620, 95 A.3d 500 (2014). “Aggrievement does not demand certainty, only the possibility of an adverse effect on a legally protected interest. . . . Statutory aggrievement exists by legislative fiat, not by judicial analysis of the particular facts of the case. In other words, in cases of statutory aggrievement, particular legislation grants standing to those who claim injury to an interest protected by that legislation.” (Internal quotation marks omitted.) Fort Trumbull Conservancy, LLC v. Alves, 262 Conn. 480, 487, 815 A.2d 1188 (2003).
“In order to determine whether a party has standing to make a claim under a statute, a court must determine the interests and the parties that the statute was designed to protect. . . . Essentially the standing question in such cases is whether the . . . statutory provision on which the claim rests properly can be understood
351 Conn. 169, 180, 329 A.3d 927 (2025) (“[w]ith statutory standing, we generally look at whether a person falls within the class of persons that the legislature has authorized to bring an action“). The issue of whether
We begin with the language of
leads us to conclude that the individual plaintiffs were aggrieved persons within the meaning of
It is undisputed that the individual plaintiffs had been elected and reappointed
within the zone of interests that the statute is designed to protect. The trial court, in concluding that the individual plaintiffs were no longer board members, improperly reached the merits of the underlying dispute rather than the threshold question of whether the individual plaintiffs had statutory standing to seek the very sort of determination
In reaching the merits of the dispute and concluding as it did that the individual plaintiffs are no longer board members, the court improperly determined that Charter Oak‘s bylaws unambiguously prohibited the individual plaintiffs from serving as holdover board members and that the plaintiffs failed to meet their burden of proving that Charter Oak waived the term limit provision of its bylaws when the board elected the individual plaintiffs to serve more than three consecutive terms.
We begin with the plaintiffs’ contention that the court improperly concluded that the bylaws unambiguously prohibited the individual plaintiffs from serving as holdovers following the expiration of their third terms. The court determined that, “[u]nder article four, § 2, of Charter Oak‘s bylaws, after the [individual] plaintiffs completed their first three consecutive terms, they were no longer eligible to be members of the board of directors.” The plaintiffs, however, argue that the bylaws do not prohibit board members from serving in a holdover capacity after the expiration of a member‘s third consecutive term. Specifically, the plaintiffs contend that, putting the issue of waiver aside, the term limit provision, when read in context, only prohibits board members from being elected to a fourth consecutive term, but does not prohibit a board member from serving as a holdover until a successor is elected following the expiration of a board member‘s third consecutive term. The defendants, on the other hand, contend that the court properly determined that the provision of the bylaws stating that “in no event shall a [d]irector hold
office for more than three . . . consecutive terms” unambiguously precludes a board member from serving once his or her third consecutive term expires.
“Courts construe bylaws according to the general rules of contract construction or statutory construction. . . . Generally, the rules governing the interpretation of contracts and statutes require courts to defer to the plain and ordinary meaning of language, unless such language gives rise to ambiguity.” (Citations omitted; internal quotation marks omitted.) Foundation for the Advancement of Catholic Schools, Inc. v. Blair, 230 Conn. App. 793, 809-10, 332 A.3d 990, cert. denied, 351 Conn. 927, 333 A.3d 1108 (2025). “If the language of the contract [or statute] is
Article four, § 2, of Charter Oak‘s bylaws provides in relevant part: “Newly-elected [d]irectors shall hold office for a term of two . . . years or until their successors [are] elected, but in no event shall a [d]irector hold office for more than three . . . consecutive terms.” (Emphasis added.) We conclude that the relevant language of article 4, § 2, of Charter Oak‘s bylaws is open to more than one reasonable interpretation with respect
to whether a board member may serve in a holdover capacity upon the expiration of a third consecutive term. The language providing that “in no event” shall directors hold office for more than three consecutive terms can reasonably be read to mean that directors cease being members in good standing upon the expiration of their third consecutive term. The language providing that directors shall hold office “until their successors [are] elected,” however, can reasonably be read to mean that a director whose third consecutive term has expired may not be elected for an additional consecutive term but nevertheless remains a holdover board member until his or her successor is elected. Accordingly, the individual plaintiffs have colorable claims to board membership, which is all that is required in order to prove that they are aggrieved persons for purposes of
In addition to determining that the individual plaintiffs were no longer board members pursuant to the bylaws, the trial court also determined that the plaintiffs’ claim that Charter Oak had waived its term limit provision by electing the individual plaintiffs to more than three consecutive terms failed. In reaching that conclusion, the court stated that “the plaintiffs have not put forth any evidence beyond the mere assertion
that these provisions were waived to demonstrate that the board of directors actually intended to waive the term limitations as set forth in the bylaws.” (Emphasis added.)
As it did with respect to the plaintiffs’ claim that the individual plaintiffs were holdover board members, the court conflated the issue of whether the individual plaintiffs had standing to pursue their waiver claim with the issue of whether the plaintiffs ultimately would prevail on the merits of that claim. At the motion to
“It is well established that [w]aiver is a question of fact.” (Internal quotation marks omitted.) Worth Construction Co. v. Dept. of Public Works, 139 Conn. App. 65, 68, 54 A.3d 627 (2012). “[W]aiver is the intentional relinquishment or abandonment of a known right or privilege. . . . [T]o determine the presence of waiver, there must be evidence of intelligent and intentional action by the petitioner of the right claimed to be waived. . . . Each case should be considered upon the particular facts and circumstances surrounding that case, including the background, experience and conduct of the party that is waiving its rights.” (Citations omitted; emphasis added; internal quotation marks omitted.) Id., 70-71.
The amended complaint and stipulation supported the plaintiffs’ claim that, notwithstanding the provision of the bylaws prohibiting board members from holding office for more than three consecutive terms, each of the individual plaintiffs was elected to a term exceeding that limitation. On the basis of that record, we conclude
that the plaintiffs produced sufficient evidence to prove a colorable claim of waiver, and, therefore, the individual plaintiffs are aggrieved persons within the meaning of
In sum, we conclude that the individual plaintiffs have standing as aggrieved persons pursuant to
The judgment is reversed and the case is remanded with direction to deny the defendants’ motion to dismiss and for further proceedings.
In this opinion the other judges concurred.