Sunday, September 08, 2013

Appeals Court Upholds Rejection of Noncomplying Articles of Incorporation For Corporation Sole

In Roman Catholic Bishop of San Jose v. Bowen, (CA App., Sept. 5, 2013), a California state appellate court upheld a decision by the Secretary of State to refuse to file the articles of incorporation for "Pastor of Santee Catholic Mission, a corporation sole," because the dissolution provision in the articles does not comply with the requirement of California law that in case of dissolution any remaining assets be distributed to the religious organization governed by the corporation sole. (Corp. Code Sec. 10015).  The articles submitted called for assets on dissolution to go to the Roman Catholic Bishop of San Jose instead of to the Santee Catholic Mission Parish. The Church had argued that the dissolution provisions in the articles were designed to assure that assets remain with the Catholic community if the parish is suppressed.