# James D. Merchant, James D. Merchant, Personal Representative for James T. Merchant (Deceased) v. Michael Ray Thomas, Jeffrey P. Hoey

> Missouri Court of Appeals · January 2, 2024

URL: https://www.frixlaw.com/law-library/cases/11098053

## Case

- **Court:** Missouri Court of Appeals
- **Decided:** January 2, 2024
- **Precedential status:** Published
- **Opinion:** Opinion by Anthony Rex Gabbert, Judge
- **Judges:** Ardini, Jr., P.J., and Chapman, J., concur.
- **Cited by:** 0 later opinions in the Frix Law Library

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## Opinion text

In the
Missouri Court of Appeals
Western District
JAMES D MERCHANT, ET AL., )
)
Respondents; )
)
JAMES D MERCHANT, PERSONAL )
REPRESENTATIVE FOR )
JAMES T MERCHANT (DECEASED), ) WD85650
) OPINION FILED:
Respondent, ) JANUARY 2, 2024
)
v. )
)
MICHAEL RAY THOMAS, )
JEFFREY P HOEY, ET AL., )
)
Appellants. )

Appeal from the Circuit Court of Saline County, Missouri
The Honorable Dennis A. Rolf, Judge

Before Division One: Edward R. Ardini, Jr., Presiding Judge,
Anthony Rex Gabbert, Judge, Thomas N. Chapman, Judge

The purported new Board of Directors of Marshall Temple Association appeals the

judgment of the Saline County Circuit Court granting injunctive and declaratory relief.

In two points on appeal, they claim the trial court’s judgment is not supported by
substantial evidence and that the trial court lacked jurisdiction because it failed to include

all necessary parties. The judgment is reversed and remanded.

Facts

The Marshall Masonic Temple Association (“Marshall Temple”) is a Missouri not-

for-profit corporation. The Articles of Incorporation (“Original Articles of

Incorporation”) filed with the Missouri Secretary of State in 1965 state that the purposes

for which the corporation is organized are:

To promote the principles of morality, integrity, good citizenship,
and brotherly love in the community, and to encourage and promote the
fraternal precepts of Free Masonry;
To acquire, equip, furnish and maintain a Masonic Temple for the
use of the Masonic Bodies of Ancient Free and Accepted Masons of the
State of Missouri, now or hereafter organized in Marshall, Missouri, to hold
title to and manage said Temple and the personal property placed therein for
the use of said Masonic Bodies and the members thereof, all in the
furtherance of the principles and tenets of Free Masonry without pecuniary
consideration to the Association. The corporation shall have all the powers
conferred upon fraternal corporations by the General Not for Profit
Corporation Act of Missouri consistent with such purpose.

The Original Articles of Incorporation further provided:

In the event this corporation should dissolve or cease to function, then all
assets of the corporation shall revert to Trilumina Lodge No. 205, Ancient
Free and Accepted Masons, if such Lodge is then existent; and in the event
said Lodge is dissolved or nonexistent, then such assts shall revert to the
Grand Lodge of Ancient Free and Accepted Masons of the State of
Missouri.

The Grand Lodge of Ancient Free and Accepted Masons (“Grand Lodge”) is also a

benevolent Missouri corporation. Trilumina Lodge No. 2015 of the Ancient Free and

2
Accepted Masons (“Trilumina Lodge”) is a fraternal subchapter of Grand Lodge.

Trilumina Lodge is not a separate Missouri corporation.

Under the Original Articles of Incorporation, Marshall Temple had no members or

stockholders but did have a perpetuating Board of Directors. The Directors of Marshall

Temple were to be elected from members of Trilumina Lodge at all Trilumina Lodge

annual meetings. Pursuant to the Original Articles of Incorporation, there were six

Directors, each serving a three-year term. Directors’ terms were staggered such that only

two Directors’ terms expired each year. Thus, two Directors were elected at each annual

meeting.

Two Directors were elected at the 2019 annual meeting. Because of the COVID-

19 pandemic, Trilumina Lodge did not hold meetings or have election communications in

2020 and 2021. No Director elections were held in those two years.

On August 4, 2021, Marshall Temple filed duly Amended Articles of Incorporation

(“Amended Articles of Incorporation”) with the Missouri Secretary of State. The

Amended Articles of Incorporation removed all references to Masonry, Grand Lodge, or

Trilumina Lodge. They changed the name from Marshall Masonic Temple Association to

Marshall Temple Association. They changed the purpose of the corporation to “the

transaction of any lawful activity conducted on a non-profit basis exclusively for

benevolent purposes consistent with Revised Statutes of Missouri Chapter 355 and

Internal Revenue Code Section 501(c)(3).”

3
The Amended Articles of Incorporation identified the current Directors of

Marshall Temple. The Directors on August 4, 2021 were the same Directors from after

the 2019 annual meeting: Brian Bench, Russell Cooksey, Paul E. Harper, Herbert

Latchaw, James D. Merchant, and Ronald Tennill (“2019 Board of Directors”). The

Amended Articles of Incorporation provided that elections shall be held annually at the

time specified in the bylaws. The terms of two Directors expired each year, starting in

2022. Marshall Temple still had no members or stockholders. The Amended Articles of

Incorporation provided:

In the event this corporation should dissolve, then all assets of the
corporation shall be distributed to another non-profit tax-exempt entity as
decided by the Board of Directors.

On August 5, 2021, Michael Ray Thomas, Master of Trilumina Lodge, purported

to convene some but not all members of Trilumina Lodge for a special election.

According to a July 28, 2021 email sent by Thomas, the special election was to fill

Director vacancies on the Marshall Temple Board of Directors. At that special election,

Michael Ray Thomas, Jeffrey P. Hoey, David Michael Diehm, Justin A. Dinwiddie,

Ronald M. Nelson, and Shawn D. Oliver were elected as the new Directors of Marshall

Temple (“2021 Board of Directors”).

Since September 1965, Marshall Temple has owned land and a building in Saline

County (“the Property”). In August 2021, Jeffrey P. Hoey, one of the members of the

2021 Board of Directors, executed a warranty deed transferring the Property from

Marshall Temple to Trilumina Lodge. Also in August 2021, the 2021 Board of Directors

4
attempted to gain control of Marshall Temple’s bank account. The account was frozen

and no parties were able to access it. The bank stated it would unfreeze the bank account

when presented with a court order determining ownership of the account.

In September 2021, James D. Merchant, the President of the 2019 Board of

Directors, and Marshall Temple filed a petition naming the six men on the 2021 Board of

Directors as defendants. In its petition, Marshall Temple claimed that there were no

vacancies on the Marshall Temple Board for Thomas to fill and that Thomas was not

authorized to act on behalf of Marshall Temple. Marshall Temple claimed that the special

election was in violation of both the Original and the Amended Articles of Incorporation.

It stated that the 2021 Board of Directors are not authorized to act on behalf of Marshall

Temple.

In Count I of its petition, Marshall Temple sought an injunction preventing the

2021 Board of Directors from holding themselves out or purporting to act as the Board of

Directors of Marshall Temple. The petition also requested that the 2021 Board of

Directors take all necessary steps to reverse and rescind their prior actions. Marshall

Temple claimed in its petition that the warranty deed transferring the Property was

fraudulent and void or voidable. Marshall Temple requested the 2021 Board of Directors

withdraw its claim to the Marshall Temple bank account. In Count II of its petition,

Marshall Temple sought declaratory relief asking the court to declare that the 2021 Board

of Directors did not and have never had authority to act on behalf of Marshall Temple, the

proper Board of Directors is the 2019 Board of Directors, Marshall Temple is the sole

5
owner of the bank account, the warranty deed transferring the Property is void, and

Marshall Temple owns the Property.

The 2021 Board of Directors filed their answer and counter claim in November

2021. They also filed a motion to dismiss for failure to join persons needed for just

adjudication. The motion claimed that Count I is essentially a suit between two groups of

Directors of Marshall Temple. It argued that the entire 2019 Board of Directors need to

be the plaintiffs bringing the suit. The motion to dismiss further argued that Trilumina

Lodge needed to be added as a defendant because it was a party to the transaction

involving ownership of the Property and the warranty deed. Marshall Temple opposed

the motion to dismiss because Trilumina Lodge was not a legal entity on record with the

Missouri Secretary of State and, thus, could not sue or be sued. A hearing was held on

the motion to dismiss. The trial court noted that it was not yet established that Trilumina

Lodge was not a legal entity. It indicated that it was going to order Trilumina Lodge

added as a party but “if it’s later developed that they need to be dismissed out, they can

be dismissed out without affecting any error or anything in the case.” The parties

discussed whether Grand Lodge should be substituted for Trilumina Lodge. The attorney

for the plaintiffs argued that Grand Lodge did not have any rights in the case. The court

stated that it would permit Grand Lodge to come in if the plaintiffs desired it. The trial

court ordered that the rest of the 2019 Board of Directors be added as plaintiffs and that

Trilumina Lodge be added as a defendant. It ordered that the attorney for the 2021 Board

of Directors would accept service on behalf of Trilumina Lodge.

6
Marshall Temple filed an amended petition complying with this order.1 The

defendants filed an answer and counterclaim to the amended petition in November 2021.

Marshall Temple filed a motion to dismiss the counter claims in January 2022 for failure

to state a claim upon which relief can be granted and for lack of verification. The trial

court granted the motion to dismiss the counter claims.

In February 2022, Grand Lodge filed a motion to intervene in the case. In its

petition attached to its motion to intervene, Grand Lodge stated that its by-laws

prohibited individual lodges from incorporating. The by-laws did allow the formation of

Building Associations to be incorporated as non-profit corporations to hold title to,

maintain, and operate the lodge’s property. Pursuant to those by-laws, Marshall Temple

was incorporated by members of Trilumina Lodge with its Articles of Incorporation

stating the corporation was to hold real and personal property for the benefit of Trilumina

Lodge, and by extension Grand Lodge, and for no other purpose.

Grand Lodge’s petition stated that the Original Articles of Incorporation of

Marshall Temple required the members of the Board of Directors to be members of

Trilumina Lodge. The six men comprising the 2019 Board of Directors were suspended

from membership from Trilumina Lodge with immediate effect on July 20, 2021.

Further, the 2019 Board of Directors was not authorized to amend the Articles of

1
The amended petition stated that in August 2021, a quorum of the 2019 Board of
Directors met and passed a resolution acknowledging, in part, that Brian Bench was to be
replaced by James T. Merchant. References to the 2019 Board of Directors include this
substitution where applicable.

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Incorporation and file the Amended Articles of Incorporation with the Missouri Secretary

of State on August 4, 2021.

Grand Lodge’s petition alleged in Count I a claim for conversion. It stated that the

2019 Board of Directors was elected with the understanding that it would act for the

benefit of Trilumina Lodge and Grand Lodge. The 2019 Board of Directors met in secret

and took action adverse to Trilumina Lodge and Grand Lodge. In attempting to amend

the Articles of Incorporation, the 2019 Board of Directors are attempting to steal the

assets being held for the benefit of Trilumina Lodge and Grand Lodge. The petition

alleged that Grand Lodge is a tax exempt entity pursuant to Section 501(c)(10) of the

Internal Revenue Code. It stated that the Amended Articles of Incorporation endanger the

tax status of Trilumina Lodge and Grand Lodge.

Grand Lodge asserted in Count II a claim of breach of fiduciary duty. It stated

that the 2019 Board of Directors had a duty to conduct the affairs of Marshall Temple for

the purposes expressed in the Original Articles of Incorporation which includes a duty to

Trilumina Lodge and Grand Lodge. Grand Lodge asserted in Count III a claim for

declaratory relief and quiet title. It requested that the Missouri Secretary of State be

ordered to strike the Amended Articles of Incorporation and that the court declare that the

2021 Board of Directors are the board of directors of Marshall Temple, that the 2021

Board of Directors control the assets of Marshall Temple including the bank account, and

that the warranty deed for the Property be adjudged valid.

8
Grand Lodge’s motion to intervene was argued on March 1, 2022. The trial court

denied the motion on March 10, 2022, stating:

After hearing the arguments of counsel and review of the pleadings filed
herein and case law provide[d], the Court finds Grand Lodge of Ancient
and Accepted Free Masons of the State of Missouri have failed to address
and establish each of the three elements necessary for intervention pursuant
to Rule 52.12(a)(2) as interpreted by the Missouri Supreme Court in State
Ex Rel. Nixon v. American Tobacco Co., Inc.,34 S.W.3d 122 (2000), and
therefore its Motion to Intervene is denied.

The case proceeded to bench trial in May 2022.

The trial court entered its judgment in July 2022. The court found that the 2019

Board of Directors was the proper Board of Directors in August 2021. The filing of the

Amended Articles of Incorporation was valid. The warranty deed transferring the

Property is void and Marshall Temple is the sole and lawful owner of the Property.

Marshall Temple is the sole and lawful owner of the bank account at issue. The judgment

stated that the 2021 Board of Directors do not and did not ever have any right to transfer

the Property or access the bank account. The 2021 Board of Directors were permanently

enjoined from holding themselves out as having authority to act for Marshall Temple and

were ordered to take all steps necessary to reverse and rescind all prior attempts to gain

access to Marshall Temple’s assets.

This appeal follows. 2

2
Grand Lodge appeals the denial of its motion to intervene in WD85658. The 2021
Board of Directors and Trilumina Lodge appeal the July 2022 judgment in WD85650. James T.
Merchant died in October 2022. He is represented in the appeal by his personal representative
James D. Merchant who is also a party to these proceedings.

9
Standard of Review

“In the appeal of a bench-tried case … the trial court’s judgment will be affirmed

unless there is no substantial evidence to support it, it is against the weight of the

evidence, or it erroneously declares or applies the law.” Lewis v. Lewis, 671 S.W.3d 734,

738 (Mo. App. W.D. 2023) (internal quotation marks omitted).

Point I

In their first point on appeal, the 2021 Board of Directors claims the trial court

erred in decreeing that the 2019 Board of Directors was the Board of Directors of

Marshall Temple on August 4, 2021. They argue that there was no substantial evidence

presented that the 2019 Board of Directors were elected by members of Trilumina Lodge.

The 2021 Board of Directors states that the only evidence presented was testimony that

James D. Merchant and Brian Bench had been elected as members of the Board of

Directors and no evidence was presented with respect to any of the other members of the

2019 Board of Directors.

As noted above, Grand Lodge appealed the denial of its motion to intervene in

case number WD85658. Our opinion in that appeal holds that Grand Lodge should have

been permitted to intervene in the underlying lawsuit. We reversed the same judgment

being appealed in this current case and remanded with instructions to grant intervention.

Accordingly, we need not address this point on appeal. The point is denied.

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Point II

After the 2019 Board of Directors filed their initial petition, the 2021 Board of

Directors filed a motion to dismiss for failure to join persons needed for just adjudication.

The motion cited Rule 52.04(a) and stated in relevant part that Trilumina Lodge was a

necessary party. The 2019 Board of Directors opposed the motion, and a hearing was

held. The trial court agreed with the 2021 Board of Directors and ordered the 2019 Board

of Directors to file an amended petition adding Trilumina Lodge as a defendant. The

2019 Board of Directors then filed an amended petition pursuant to the trial court’s order

and named Trilumina Lodge as a defendant.

In their second point on appeal, the 2021 Board of Directors assert complaints

about the mechanics used to add Trilumina Lodge as a party. Specifically, the 2021

Board of Directors argue that, because Trilumina Lodge is an unincorporated association,

simply naming it as a party was insufficient. Instead, the 2019 Board of Directors claim

it was necessary to either name every individual member of Trilumina Lodge as a

defendant or name certain members of Trilumina Lodge as representative parties pursuant

to Rule 52.10. This argument is being made for the first time in this appeal. Thus, it is

not preserved, and we decline to review.3 See Steinmann v. Davenport, 248 S.W.3d 8, 15

n.5 (Mo. App. E.D. 2008). The point is denied.

3
Although we are declining to review this unpreserved claim, we note that because the
judgment is being reversed and the case is being remanded to the trial court due to the error
addressed in case number WD85658, the parties will have the opportunity to raise with the trial
court any concerns related to the mechanics utilized to add Trilumina Lodge as a party.

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Conclusion

In case number WD85658, this court reversed the same judgment being appealed

in this case and remanded the matter to allow intervention of Grand Lodge and proceed

accordingly. Given that, we reverse the trial court’s judgment in this current appeal and

remand with instructions that the trial court act in accordance with our opinion in case

number WD85658.4

__________________________________
Anthony Rex Gabbert, Judge

All concur.

4
The Respondents filed a motion for their attorneys’ fees on appeal. That motion was
taken with the case and is now denied given the disposition in this opinion.

12

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/11098053. Public record. Not legal advice.