Following is a transcript of the video recorded message from Commodore Scott Miller circulated as a link in the EYC Newsblast for February 4 - 15, 2015.
I am using this method of communication because what I have to say concerns every member of Eastport Yacht Club and I have found that traditional methods of communication are often overlooked.
As most of you know, a few Senior Members are threatening legal action against the Club. They claim that the Club, by the vote of the Membership taken on September 7, 2014, committed a "breach of contract" in its changing of the discount they receive from 25% of voting member dues to 60% of voting member dues. These Senior Members are acting on advice from a local law firm: Krause and Ferris. As I mentioned in my previous communication on this matter, we have communicated back to them that we do not agree with their view of the Membership action. We believe we have acted properly and in accordance with our by-laws in making changes to the Senior Membership Category (formerly known as "Emeritus").
A few members have approached me to suggest that if the Senior Members who were in place prior to the vote were "grandfathered" – effectively allowing them to retain their previous dues discount level – the threatened lawsuit would not be filed in Anne Arundel Circuit Court. This would mean that the 55 Senior Members in place as of last year would pay 25% of voting member dues while any new Senior Members would pay the member approved 60% of voting member dues.
Some have suggested the Board could take this action on its own initiative. I wish to inform anyone supporting the "grandfathering" of current Senior Member dues that this is NOT an action that the Board could take on its own initiative – even if we were so inclined. I have discussed this with the Board and consulted our counsel in this matter and they unanimously agree with me. The members have approved a change in Senior Member status by a procedure that is called for in the by-laws. To contemplate any alteration of the outcome of the vote by members would require another member vote.
Naturally, the Board is anxious to avoid the threatened lawsuit, as it would be a drain on Club financial and other resources. Any suit brought against the Club is a lawsuit against ALL members, not just the Board. During the period when a lawsuit is threatened by some Senior Members, the Board will have to make contingency plans in the event a suit is filed. While counsel has been provided to us pro bono up to this point, no law firm or its partners would consider doing this throughout the course of a lawsuit. Accordingly, if a lawsuit is filed, we will have to reserve funds to fight what we believe would be an action against our by-laws. If contingent funds are needed, some Club services will have to be eliminated and events canceled if they do not at least "break-even." I cannot say at this point what services or events would be affected as that would need to be done in conjunction with our General Manager and Committee Chairs but to do otherwise would not be living up to the fiduciary responsibilities that are the Board's charge.
But before we get too far down the road, let me remind those Senior Members of by-laws procedures that could provide an alternative to legal action. Article 10, Section 2 of our by-laws allows that "Special Meetings" may be called "at any time" by the Commodore, the Executive Board or – and this is the important part – "by written petition to the Keeper of the Log duly signed by ten percent of the total Voting Members." That means that if the Senior Members who feel aggrieved by the September 7 vote can get 60 signatures -- which is 10% of our member cap of 600 voting members -- on a motion that they draft and submit to our Keeper of the Log, we must call a Special Meeting to consider the motion. The vote on September 7 was overwhelming 205-70, but there were over 60 voting members who voted against the amendment.
I will give my personal commitment that if those threatening legal action against the Club remove the threat and concentrate their efforts on a motion and petitions to call such a Special Meeting as allowed under the by-laws, I will convene it at a time of their choosing. I will ensure that mailings are made in the appropriate time to voting members and recuse myself from participating in the subsequent discussion. I will also urge my fellow Board members from engaging in such a debate. We will limit our activity to running the Special Meeting and merely voting once a vote is called.
My primary focus as Commodore in this matter is to uphold the Eastport Yacht Club by-laws. However, after discussions with the Executive Board and our counsel we are firm in our view that the actions taken by the Club's Members on September 7 are lawful, consistent with our by-laws and do not constitute a "breach of contract." Legal research into relevant Maryland case law has further strengthened the view of the Board and our counsel that we would prevail in Court if forced to defend our procedures under the by-laws.
In suggesting the alternative of a member driven motion and appropriately supported Special Meeting, I am imploring those Senior Members who feel themselves aggrieved by the Member vote of September 7 to seek redress through a process allowed by the by-laws. The alternative, a divisive lawsuit that will drain resources and goodwill from the Club, is too awful to contemplate.
As I noted in my last communication to you on this subject, the Club has found its way through difficult times before. It is my hope that all parties – those senior members who feel aggrieved and those who are angered that their Club is being threatened with a lawsuit – find it within themselves to stay the course of process called for by the by-laws. If we can restrain our emotions just a bit longer we can get through this and once again bring back good fellowship into our midst as Club.