Recently, the Kentucky Supreme
Court issued an opinion addressing a narrow but interesting question as to the
ability to sue a labor union and similar unincorporated organizations that are
not susceptible to being sued in their own name. In this case, the Plaintiff argued that the
Defendant labor union was tardy in raising as a defense its inability to be
sued. On the facts of this case, the
Supreme Court found that it acted on a timely basis. United
Brotherhood of Carpenters v. Birchwood Conservancy, No. 2011 SC-000659-DG,
2014 WL 2773105 (Ky. June 19, 2014).
The Birchwood Conservancy, itself
an unincorporated association, had certain discussions with members of the
United Brotherhood of Carpenters labor union regarding the dismantling of an
old barn and the erection of a new one.
When that work was not completed to Birchwood’s expectations, it brought
suit against the United Brotherhood of Carpenters. The initial Complaint was filed in September
2004, with an Amended Complaint filed in 2005.
In response to the initial Complaint, the union denied a contract
existed. In response to the Amended
Complaint, the Union’s answer was that the Complaint failed to state a claim
and therefore should be dismissed.
Finally, in March 2007, the Union filed a Motion to Dismiss on the
grounds that “an unincorporated association such as a labor union, cannot sue
or be sued in the name of the association.”
In response, Birchwood asserted that the union had waived that defense
by failing to previously raise it.
Perhaps uniquely, this case
raised as well the issue of the capacity of the Plaintiff to bring an
action. The Birchwood Conservancy was
itself an unincorporated association that lacked the capacity, in its own name,
to bring suit. Ultimately, a non-profit
corporation was allowed to join the suit as a Plaintiff.
Ultimately, the Court found
that once the corporation with standing to bring suit joined the action and
brought additional claims for relief, the clock for defending on the basis of
lack of capacity to be sued was re-set:
Therefore, when the new plaintiffs
(who did possess the authority to file suit) intervened and were allowed to
substitute themselves for Birchwood Conservation Center, adding several new
damage claims, it was as if an entirely
new complaint had been filed. Thus,
any defenses asserted by the Union in its answer to the new plaintiff’s
complaint were timely made, as this was, in effect, the Union’s first response to the new parties’
properly filed complaint with its new or substantially altered claimed damages.
(Emphasis
in original.)
Characterizing this entire
dispute as between “two parties who both
squandered the Court’s time and resources, in addition to their own,” the suit
was dismissed.
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