Donald Sims v. Jerusalem Missionary Baptist Church, Inc.

COURT OF APPEALS
DECISION NOTICE
DATED AND FILED This opinion is subject to further editing. If
published, the official version will appear in
the bound volume of the Official Reports.
October 31, 2023
A party may file with the Supreme Court a
Samuel A. Christensen petition to review an adverse decision by the
Clerk of Court of Appeals Court of Appeals. See WIS. STAT. § 808.10
and RULE 809.62.

Appeal No. 2022AP1590 Cir. Ct. No. 2021CV6236

STATE OF WISCONSIN IN COURT OF APPEALS
DISTRICT I

DONALD SIMS,

PLAINTIFF-APPELLANT,

V.

JERUSALEM MISSIONARY BAPTIST CHURCH, INC., ANTOINETTE REDD
AND VIRGIL STEPHENS,

DEFENDANTS-RESPONDENTS.

APPEAL from an order of the circuit court for Milwaukee County:
CARL ASHLEY, Judge. Affirmed.

Before White, C.J., Donald, P.J., and Dugan, J.

Per curiam opinions may not be cited in any court of this state as precedent

or authority, except for the limited purposes specified in WIS. STAT. RULE 809.23(3).
No. 2022AP1590

¶1 PER CURIAM. Donald Sims appeals from an order granting
Jerusalem Missionary Baptist Church, Inc., (the Church), Antoinette Redd, and
Virgil Stephens’1 motion to dismiss Sims’ amended complaint in which he sought
to invalidate the 2019 version of the Church’s bylaws. On appeal, Sims initially
argued that: (1) the circuit court failed to construe inferences from the amended
complaint in favor of Sims; (2) the amendments to the 1967 bylaws of the Church
are void because the original bylaws only permitted amendment by a two-thirds
majority vote of the members of the Church and members did not vote to amend
the bylaws in 2016; (3) if the phrase, “by a [two-thirds] majority vote” in Article X
of the 1967 bylaws was ambiguous, the text of Article X must be construed
against the Church; (4) the Wisconsin Statutes do not permit the board of directors
of a corporation like the Church to delegate the authority to amend corporate
bylaws to an individual; and (5) WIS. STAT. §§ 181.0206 and 181.1022 (2019-20),2
were violated when the Church’s bylaws were amended in 2016 and 2019,
because the amendments were neither adopted by, nor voted on by members of the
Church.

¶2 After briefing was completed in this case, this court issued an order
directing the parties to file a supplemental brief addressing whether WIS. STAT.
§ 181.13 (1967-68), which was the applicable statute when the initial bylaws for
the Church were filed with the Wisconsin Secretary of State in 1967, applies or

1
Because Antoinette Redd and Virgil Stephens are presenting the same arguments on
appeal, we will include them in the reference to the Church throughout for ease of reading.
2
We note that the language in WIS. STAT. §§ 181.0206 and 181.1022 is the same in the
2015-16 version of the Wisconsin Statutes and the 2019-20 version. Accordingly, all references
to the Wisconsin Statutes are to the 2019-20 version unless otherwise noted.

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whether some version of WIS. STAT. § 186.0206, governs how the Church’s initial
bylaws could be adopted.3

¶3 In his supplemental brief, Sims states that WIS. STAT. § 181.13
(1967-68), applies to the facts in this case, and therefore, for the 1967 Bylaws to
be valid, the Church’s board of directors had to adopt the bylaws. He then asserts
that the board did not adopt those bylaws, and therefore, they are not valid and
could not govern any future amendment of the 1967 Bylaws. He further argues
that “[a]s the 1967 Bylaws were not valid, members of the Church had to approve
the 1967 Bylaws by custom and acquiescence in order for the Church to function
under the direction of Reverend Donnie Sims.” Sims then argues that “[w]hether
invalid or adopted by custom and acquiescence, the 1967 Bylaws could not be
amended by the board to create new bylaws on January 1, 2016.”

¶4 For the reasons stated below, we conclude that: (1) the allegations in
the amended complaint and the documents attached thereto, demonstrate that the
1967 Bylaws were properly adopted by the Church’s board of directors; (2) the
1967 Bylaws provide that the bylaws may be amended by a two-thirds majority
vote of the Church’s board of directors; (3) the Church’s board of directors
properly amended the Church’s bylaws in 2016; (4) Rev. Donnie Sims properly
adopted the 2019 Bylaws; and (5) if the 1967 Bylaws were invalid, then the 2016
Bylaws would have been the Church’s initial bylaws and were properly adopted
by the Church’s board of directors. Thus, we conclude that the 2019 Bylaws

3
Neither party mentioned WIS. STAT. § 181.13 (1967-68), in their initial briefs. That
statute provides, in part, that “[t]he initial bylaws of a corporation shall be adopted by its board of
directors. Thereafter, bylaws may be adopted either by the members or the board of directors, but
no bylaw adopted by the members shall be amended or repealed by the directors, unless the
bylaws adopted by the members shall have conferred such authority upon the directors.”

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currently are the bylaws that govern the Church, and therefore, Sims did not have
the power to dismiss Redd and Stephens from the Church’s board of directors.
Thus, we affirm the circuit court’s order granting the Church’s motion to dismiss
Sims’ amended complaint.

BACKGROUND

¶5 The Church was founded in 1967 by Reverend Donnie Sims,4 Sims’
father. On June 28, 1967, Rev. Donnie Sims registered the Church with the
Wisconsin Secretary of State and filed the Church’s Articles of Incorporation and
initial “Constitution—Bylaws” (1967 Bylaws). The Articles of Incorporation
named the five initial directors, which included Rev. Donnie Sims. The 1967
Bylaws contain ten bylaws, numbered Article I through Article X. Relevant to
this appeal, Article X provides that “[t]he [Bylaws] under this constitution of the
[C]hurch may be amended or rescinded by a 2/3 majority vote, but they may never
be suspended.”

¶6 Rev. Donnie Sims was the pastor of the Church and one of its
directors. He remained in those positions for fifty-five years, until his death on
August 5, 2020. Sims was installed as pastor of the Church on November 15,
2020. Upon his installation as pastor, Sims dismissed Redd and Stephens from the
Church’s board of directors.

4
Because both Donnie Sims and Donald Sims have the same last name, we refer to them
as Rev. Donnie Sims and Sims.

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The 2016 Bylaws

¶7 On January 16, 2016, the Church’s board of directors adopted new
bylaws for the Church.5 The 2016 Bylaws contain two bylaws relevant to this
appeal. Article V A. provides in part the following:

[T]he Pastor, by virtue of office, shall be the President of
the Board of Directors. The Pastor shall be the [sic]
responsible for the spiritual and doctrinal guidance of the
church. The Pastor is the chief executive officer of the
Church and shall have the general oversight and
supervision of the business and spiritual affairs of the
Church and its ministries. The Pastor shall be an ex-officio
member of all committees of the Church and shall have
general supervision of all Church officers. The Pastor shall
have the right to appoint or remove directors, officers
and/or deacons of the Church ….

The second bylaw, Article XIV, titled Amendments, provides as follows:

With the exception of Article V and Article XIV,
these Bylaws may be amended or replaced with new
Bylaws if approved or adopted by 2/3 majority of the Board
of Directors at any regular or special meeting, except as
otherwise indicated herein. Article V and Article XIV of
these Bylaws may not be amended except by the Pastor as
led by the Word and the Spirit of God, or (i) as authorized
by unanimous vote of the Board of Directors and
(ii) subsequently confirmed by a vote of at least two-thirds
(2/3) of the voting membership who are in attendance at a
special meeting of the Church.

The 2016 Bylaws were “duly adopted at a meeting of [the] board [of] the directors
of the corporation held on 01/16/16.”

5
We note that Sims asserted in his original complaint and in his amended complaint that
the 2016 Bylaws were valid and governed the Church.

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No. 2022AP1590

The 2019 Bylaws

¶8 In his amended complaint, Sims alleges that in 2019, Rev. Donnie
Sims decided that Article V of the 2016 Bylaws should be amended to provide that
the successor pastor of the Church should have the general oversight and
supervision of the spiritual affairs of the Church, and that the Church’s board of
directors should have the general oversight and supervision of the business affairs
of the Church. It specifically alleges that Rev. Donnie Sims “retained an attorney
and requested amendments to the [2016 Bylaws]” so that the bylaws for the
Church would provide for the division of responsibilities between the pastor and
the board of directors described above. It further alleges that “[t]he attorney
retained by Reverend Donnie Sims amended the [2016 Bylaws] and drafted the
[2019 Bylaws] in accordance with the specific requests of Reverend Donnie
Sims.” “The 2016 Bylaws of [the Church] were amended at the request of
Reverend Donnie Sims, without consideration or adoption by the members of or
the board for the Church.”6

¶9 Article V of the 2019 Bylaws, titled “Founding Pastor; Successor
Pastor,” provides in part as follows:

Duties and Powers of the Founding Pastor.… Rev.
Donni[e] is the Founding Pastor and the Lord’s under-
Shepard for this Church.… [T]he Founding Pastor, by
virtue of office, shall be the President of the Board of
Directors. The Founding Pastor shall be the responsible for
the spiritual and doctrinal guidance of the [C]hurch. The
Founding Pastor is the chief executive officer of the Church
and shall have the general oversight and supervision of the
business and spiritual affairs of the Church and its

6
We note that the language quoted here is repeated several times in the amended
complaint.

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No. 2022AP1590

ministries.… The Founding Pastor shall have the right to
appoint or remove directors, officers and/or deacons of the
Church[.]

A. Duties and Powers of Succession Pastor(s). For the
purpose of these Bylaws, the individual who succeeds
the Founding Pastor in office … shall be referred to
herein as the Successor Pastor. Upon the appointment
of the Successor Pastor by the Founding Pastor and/or
Board of Directors, the Successor Pastor shall have the
general oversight and supervision of the spiritual affairs
of the Church and its ministries, and the Board of
Directors shall assume and have the general oversight
and supervision of the business affairs of the [C]hurch
and its ministries.

The 2019 Bylaws reflect that they were “duly adopted at a meeting of [the] board
[of] the directors of the corporation held on 6/25/19.”7

Proceedings in the Circuit Court

¶10 Sims filed his complaint in the circuit court on October 8, 2021. In
the complaint, he alleged that the 2019 Bylaws are not valid because “the
amendment was neither considered nor adopted by the members or the board” and
“the [2016 Bylaws] govern [the Church], and control the actions of the members
and board of directors of [the Church], as the [2019 Bylaws] are not valid or
legally binding.” The complaint sought a declaratory judgment that “the [2019
Bylaws] of [the Church] are not valid or legally binding” and “[a]s the 2019
Bylaws of [the Church] are not valid or legally binding, the 2016 Bylaws of [the

7
We note that the Church asserts that pursuant to Article XIV of the 2016 Bylaws, Rev.
Donnie Sims did not need to submit the 2019 Bylaws to the board of directors to have the board
adopt and approve them. As noted above, Article XIV of the 2016 Bylaws states in part that
Article V—which gave the Pastor “the general oversight and supervision of the business and
spiritual affairs of the Church”—may be amended “by the Pastor as led by the Word and the
Spirit of God” or alternatively “by a unanimous vote of the board of directors” with that vote
being “subsequently confirmed by a vote of at least two-thirds (2/3) of the voting membership
who are in attendance at a special meeting of the Church.”

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No. 2022AP1590

Church] govern [the Church], and control the actions of the members and board of
directors of the Church.”

¶11 The Church filed its motion to dismiss the complaint on January 12,
2022, and the parties filed their briefs. Sims then filed an amended complaint on
March 14, 2022. In his amended complaint, Sims made a different argument—he
alleged that the 2016 Bylaws were invalid because the amendment “was not
considered or adopted by the members or the board” of the Church and that the
2019 Bylaws were not valid because they were adopted based upon the terms of
the 2016 Bylaws that were not validly adopted. Thus, he alleged that both the
2016 Bylaws and the 2019 Bylaws were invalid and that the 1967 Bylaws govern
the Church.

¶12 In his brief in opposition to the Church’s motion to dismiss, Sims
acknowledged that the Church’s board of directors adopted both the 2016 Bylaws
and the 2019 Bylaws. However, he argued that the 1967 Bylaws could only be
amended by a two-thirds majority vote of the members, and therefore, both the
2016 Bylaws and the 2019 Bylaws were invalid because they were not amended
by a vote of the members. He then argued that the 1967 Bylaws governed the
Church.

Circuit Court Decision

¶13 The circuit court held a hearing on the Church’s motion to dismiss
on July 22, 2022, and rendered an oral decision. The court stated that Article X of
the 1967 Bylaws of the Church was ambiguous because, although it stated that
“[t]he Bylaws under this constitution of the church may be amended or rescinded
by a 2/3 majority vote,” it did not state whether that vote was of the members of
the Church or the board of directors of the Church. It then stated that when there

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No. 2022AP1590

is some ambiguity, subsequent conduct of the parties is highly probative of the
intended meaning of the ambiguous terms and “the [c]ourt will normally adopt
that interpretation of the contract, which the parties themselves have adopted.”

¶14 The circuit court then considered how the 1967 Bylaws were
amended in 2016. It noted that the amendment in 2016 was done by the board of
directors of the Church. The court then held that that action by the board of
directors of the Church in 2016 clarified what the intent of the parties was as to
how the 1967 Bylaws could be amended. The court then concluded that the
amendment of the 2016 Bylaws in 2019 was also valid. It stated that it was
granting the motion to dismiss.

¶15 The circuit court then issued a written order dated August 30, 2022,
which stated in part:

IT IS HEREBY ORDERED as follows:

1. [The Church’s] Motion to Dismiss is granted in its
entirety.

2. [The Church] bylaws dated June 25, 2019 are the
governing bylaws of [the Church].

3. All conduct engaged in by Donald Sims relating to the
general oversight and supervision of the business affairs
of [the Church] since November 15, 2020, when he was
named the Successor Pastor of the Church, is null and
void and of no legal effect.

4. The Board of Directors of [the Church] consists of
Donald Sims, Antoinette Redd, Virgil Stephens, and
Della Clipps, who were the directors of the Church just
prior to November 15, 2020.

5. The Amended Complaint … filed by [Sims], as well as
this entire case, is hereby dismissed with prejudice and
without costs to any of the parties.

¶16 This appeal followed.

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No. 2022AP1590

DISCUSSION

I. Standard of Review

¶17 Whether a complaint states a claim upon which relief can be granted
is a question of law that this court reviews de novo. Data Key Partners v. Permira
Advisers LLC, 2014 WI 86, ¶17, 356 Wis. 2d 665, 849 N.W.2d 693. When
reviewing a motion to dismiss, “we construe the pleadings liberally and accept as
true both the facts contained in the complaint and any reasonable inferences
arising from those facts.” Doe 56 v. Mayo Clinic Health Sys.-Eau Claire
Clinic, Inc., 2016 WI 48, ¶14, 369 Wis. 2d 351, 880 N.W.2d 681. We cannot
“add facts in the process of construing a complaint,” and we need not accept as
true any legal conclusions stated in the complaint. Data Key Partners, 356
Wis. 2d 665, ¶19. “[T]he sufficiency of a complaint depends on substantive law
that underlies the claim made because it is the substantive law that drives what
facts must be pled.” Id., ¶31.

II. The 1967 Bylaws of the Church were Properly Adopted

¶18 The starting point in this court’s analysis is whether the 1967 Bylaws
were properly adopted pursuant to WIS. STAT. § 181.13 (1967-68). In their
supplemental briefs in response to this court’s order directing the parties to file
supplemental briefs addressing whether § 181.13, which was the applicable statute
when the initial bylaws for the Church were filed with the Wisconsin Secretary of
State in 1967 and governs how the Church’s initial bylaws could be adopted, both
parties stated that § 181.13 applies to the facts in this case. That statute provides,
in part, that “[t]he initial bylaws of a corporation shall be adopted by its board of
directors.” Id.

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¶19 We note that both before the circuit court and initially on appeal
Sims asserted that the 1967 Bylaws were valid and governed the operation of the
Church. He argued that the 1967 Bylaws “were adopted by members of the
Church.” At times he argued that the 2016 and 2019 Bylaws were not valid
because they were not adopted by the members of the Church as required by
Article X of the 1967 Bylaws, which provides “[t]he By-Laws under this
constitution of the church may be amended or rescinded by a 2/3 majority vote[.]”
In his supplemental brief, Sims now argues that the 1967 Bylaws were not adopted
by the board of directors of the Church and, are therefore, not valid and could not
govern any future amendment of the 1967 Bylaws. However, he argues that “the
bylaws used to amend the 1967 Bylaws were approved by the members of the
Church by custom and acquiescence.”8

¶20 Based on the following facts, we conclude that the Church’s board
of directors adopted the 1967 Bylaws. Most significant is the fact that WIS. STAT.
§ 181.13 (1967-68), specifically requires that “[t]he initial bylaws of a corporation
shall be adopted by its board of directors.” Thus, although the statutes governing
adoption of the initial bylaws of a corporation were amended in the future to

8
We also note that the Church has been inconsistent in its arguments regarding who
adopted the 1967 Bylaws. At times it asserts that Rev. Donnie Sims adopted the bylaws as the
incorporator of the Church and at times asserts that the board of directors adopted the bylaws. In
its supplemental brief, the Church argues that whether the 1967 Bylaws were adopted by the
Church’s board of directors, the Church’s members, or the Church’s incorporator, it does not
make a difference to the result of this appeal. It argues that if the 1967 Bylaws were adopted by
the board of directors then pursuant to WIS. STAT. § 181.13 (1967-68), those bylaws are valid and
new bylaws could be adopted by either the board of directors or Church members, which
occurred in 2016 and 2019. Conversely, if the Church’s members or its incorporator adopted the
1967 bylaws, those bylaws would be invalid and the Church’s initial bylaws were those adopted
by the Church’s board of directors in 2016 under WIS. STAT. § 181.0206 (2015-16), and were
properly amended in 2019 by the Church’s board of directors under WIS. STAT. § 181.0206
(2019-20). We address the Church’s argument in more detail below.

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No. 2022AP1590

provide that “[t]he incorporators, members or board of a corporation shall adopt
the initial bylaws for the corporation,” see WIS. STAT. § 181.0206, the only way in
1967 that a corporation’s bylaws could be adopted was by the board of directors of
the corporation adopting those bylaws. Here, Rev. Donnie Sims was the founder
of the Church and was one of the original five directors of the board. It is
undisputed that the Church’s Articles of Incorporation and 1967 Bylaws were filed
with the Secretary of State for the State of Wisconsin on June 7, 1967. The
Secretary “certified that Articles of Incorporation of [the Church] … was in the
date hereof, accepted and filed in my office.” On June 7, 1967, the Articles of
Incorporation lists Rev. Donnie Sims as an initial director and he signed the
articles on that date.9

¶21 Thus, based on the facts that WIS. STAT. § 181.13 (1967-68),
provided that the only way the Bylaws for the Church could have been adopted in
1967 was for the Church’s board of directors to adopt them, that the Articles of
Incorporation list the Church’s five original directors, that Rev. Donnie Sims was
an initial director of the Church, that Rev. Donnie Sims signed the Articles of
Incorporation and filed both the articles and the 1967 Bylaws with the Secretary of
State who accepted them, we conclude that the record reflects that the Church’s
board of directors adopted the 1967 Bylaws.

9
Sims argues that the fact that Rev. Donnie Sims was a director and signed the Articles
of Incorporation does not show that the board of directors adopted the bylaws. He asserts that
Rev. Donnie Sims’ signature does not show that he was signing as a director and thus he is
merely signing as a member. He also argues that there is another signature on the Articles of
Incorporation and that person is not listed as a director and thus she must be signing as a member.
However, Sims does not provide any facts regarding whether that person is a member of the
Church or why her signature is on the document.

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II. The 1967 Bylaws provide that the Bylaws may be
amended by a 2/3 majority vote of the Church’s Board of
Directors

¶22 We next address whether the Church’s board of directors had
authority to amend the 1967 Bylaws or whether only members of the Church had
authority to amend the bylaws. The starting point of this court’s analysis is the
language contained in Article X of the Church’s 1967 Bylaws which states that
“[t]he Bylaws under this constitution of the church may be amended or rescinded
by a 2/3 majority vote, but they may never be suspended.” We agree with the
circuit court that the language in Article X of the bylaws is ambiguous because
while it states that the bylaws may be amended or rescinded by a two-thirds
majority vote, it does not state whether that vote would be of the members of the
Church, the board of directors of the Church, or either the members or the board.10

¶23 “Thus, we first look to the contract language to ascertain the parties’
intent, as our goal in scrutinizing a contract is to determine and give effect to the
parties’ intentions.” J.G. Wentworth S.S.C. Ltd. P’ship v. Callahan, 2002 WI
App 183, ¶11, 256 Wis. 2d 807, 649 N.W.2d 694. “If the contract is
unambiguous, our attempt to determine the parties’ intent ends with the four
corners of the contract, without consideration of extrinsic evidence.” Betz v.
Diamond Jim’s Auto Sales, 2014 WI 66, ¶39, 355 Wis. 2d 301, 849 N.W.2d 292
(citation omitted). “Only when the contract is ambiguous, meaning it is
susceptible to more than one reasonable interpretation, may the court look beyond

10
We note that WIS. STAT. § 181.13 (1967-68), provides in part that “[t]he initial bylaws
of a corporation shall be adopted by its board of directors. Thereafter bylaws may be adopted
either by the members or the board of directors ….”

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No. 2022AP1590

the face of the contract and consider extrinsic evidence to resolve the parties’
intent.” Id. (citation omitted).

¶24 Where the language in the bylaws is ambiguous, subsequent conduct
of the parties is highly probative of the intended meaning of that provision. In
Zweck v. D P Way Corp., 70 Wis. 2d 426, 435, 234 N.W.2d 921 (1975), our
supreme court stated:

It is a well-settled principle of Wisconsin law that, where
contract terms may be taken in two senses, evidence of
practical construction by the parties is highly probative of
the intended meaning of those terms and the court will
normally adopt that interpretation of the contract which the
parties themselves have adopted.

Here, Rev. Donnie Sims was the founder, incorporator, President, and one of the
initial directors of the Church and continued as a director until his death. In 2016,
Rev. Donnie Sims requested that the Church’s board of directors, not the Church’s
members, adopt new bylaws. Moreover, in his original complaint, Sims alleged
that the 2019 Bylaws were invalid because they were not adopted by either the
members of the Church or the board of directors of the Church, which left the
2016 Bylaws to govern the Church. Thus, at some point, Sims believed that the
2016 Bylaws were properly adopted, which in effect amended the 1967 Bylaws.
Further, when he became pastor after Rev. Donnie Sims’s death, Sims sent letters
to Redd and Stephens informing them that they were “being removed as a board of
director” for the Church. Although Sims does not allege how, as pastor, he had
power to remove a board member, that power had to come from the 2016 Bylaws,
which provided that the “Pastor shall have the right to appoint or remove
directors” because the 1967 Bylaws did not grant the Pastor such power.

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No. 2022AP1590

¶25 Further, as noted above, in his amended complaint Sims alleged that
in 2019, pursuant to Article XIV of the 2016 Bylaws, Rev. Donnie Sims adopted
the 2019 Bylaws, thereby amending the 2016 Bylaws. Although Sims was a
director of the Church, he did not challenge the board’s adoption of the 2019
Bylaws until he filed his original complaint on October 10, 2021, which occurred
after his father, Rev. Donnie Sims, died on August 5, 2020, and he was installed as
Pastor of the Church on November 15, 2020. Thus, the 2019 Bylaws were the
governing document for the Church for a little over three years before Sims filed
his complaint and challenged their validity.

¶26 We conclude that the subsequent conduct of the parties is highly
probative of the intended meaning of the provision in the 1967 Bylaws that the
Church’s Bylaws “may be amended or rescinded by a 2/3 majority vote” was
intended to be a vote by the Church’s board of directors, not its members.11 We
next address whether the Church’s board of directors had authority to delegate its
power to amend the 2016 Bylaws to Rev. Donnie Sims.

III. The Board of Directors of the Church had authority to
delegate amending the 2016 Bylaws to Rev. Donnie Sims

¶27 Before the circuit court and on appeal, the Church argues that in
2016 the Church’s board of directors amended its bylaws and delegated the
authority to amend the Church’s bylaws to Rev. Donnie Sims. As noted above,

11
We also conclude that alternatively it would be a reasonable interpretation, consistent
with WIS. STAT. § 181.13, that the language in Article X of the 1967 Bylaws that the bylaws “of
the Church may be amended or rescinded by a 2/3 majority vote” is that after the initial bylaws
were adopted by the board of directors, either the board of directors or the members could adopt
bylaws by a two-thirds majority vote. However, in any event, the subsequent conduct of the
parties does not support an interpretation that only the Church’s members could amend or rescind
the bylaws.

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No. 2022AP1590

Article XIV of the 2016 Bylaws states in part that Article V—which gave the
Pastor the general oversight and supervision of the business and spiritual affairs of
the Church, may not be amended except by the Pastor as led by the Word and the
Spirit of God, or (i) as authorized by a unanimous vote of the [b]oard of [d]irectors
and (ii) subsequently confirmed by a vote of at least two-thirds (2/3) of the voting
membership who are in attendance of a special meeting of the Church. Before the
circuit court and on appeal, the Church argued that the Wisconsin Statutes give a
corporation’s board of directors the authority to amend a corporation’s bylaws and
that the statutes and the common law give a corporation’s board of directors the
power to delegate its authority to others. It then stated that is what the Church did
in 2016 by amending the Church’s bylaws and giving Rev. Donnie Sims the
authority to amend the bylaws.

¶28 Before the circuit court, Sims argued that the 2016 Bylaws are
invalid because the 1967 Bylaws were amended without approval by the Church’s
board of directors or a two-thirds majority vote of the members of the Church. He
argued that WIS. STAT. § 181.1022(1) provides that any proposed amendment to a
corporation’s bylaws must be voted on by its members if the proposed amendment
affects or changes the voting rights of the members.12 He then argued that because
the Church’s bylaws were amended in 2016 to change the voting rights of
members in the Church it was inconsistent with that statute, and therefore, the

12
WISCONSIN STAT. § 181.1022(1)(a) provides in part that “[t]he members of a class in a
corporation are entitled to vote as a class on a proposed amendment to the bylaws if the
amendment does any of the following: (a) [a]ffects the rights … of that class as to voting ... in a
manner different than such amendment would affect another class.” We agree with the Church’s
argument that the statute does not apply to this case because there is only one class of
membership in the Church.

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No. 2022AP1590

2016 Bylaws were void. Sims then argued that therefore, Rev. Donnie Sims did
not have the authority in 2019 to amend the Church’s bylaws.

¶29 Sims also argued that if the 1967 Bylaws were adopted by the
Church’s members, Rev. Donnie Sims would still not have the authority to amend
the Church’s bylaws. He argues that WIS. STAT. § 181.0206(2) provides that after
the adoption of the initial bylaws, “no bylaw adopted by the members shall be
amended or repealed by the directors, unless the bylaws adopted by the members
shall have conferred such authority upon the directors.” He then asserts that if the
1967 Bylaws were approved by members of the Church, the board of directors
would not have the authority to amend those bylaws in 2016.

¶30 As Sims now concedes, WIS. STAT. § 181.13 (1967-68), which
provides that the initial bylaws of the corporation had to be adopted by the board
of directors applies, and therefore, any argument regarding the members adopting
the initial bylaws is irrelevant. The circuit court accepted the Church’s arguments
and found that the board of directors had the power to delegate its authority to
amend the bylaws to Rev. Donnie Sims and that is what the board did in the 2016
Bylaws.

¶31 On appeal, the Church points out that Sims argues on appeal that the
delegation of the board’s powers to amend the bylaws to Rev. Donnie Sims in
Article XIV of the 2016 Bylaws is void because it is contrary to WIS. STAT.
§ 181.0801(3)(a). That statute provides that

The articles of incorporation or bylaws approved by the
members, if any, may authorize a person to exercise some
or all of the powers which would otherwise be exercised by
a board. To the extent so authorized such a person shall
have the duties and responsibilities of the board, and the
directors shall be relieved to that extent from such duties
and responsibilities.

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No. 2022AP1590

Id. The Church then states that Sims argues that because there is no evidence to
demonstrate that the 2016 Bylaws were approved by the members of the Church
as required in the statute, the Church’s board of directors had no power to delegate
the power to amend Article V of the 2016 Bylaws to Rev. Donnie Sims. It then
argues that Sims did not make that argument in the circuit court, and therefore, he
cannot properly raise it for the first time on appeal.

¶32 In his reply brief on appeal, Sims does not refute the Church’s
argument. Thus, we conclude that Sims has conceded the Church’s argument. See
Charolais Breeding Ranches, Ltd. v. FPC Sec. Corp., 90 Wis. 2d 97, 109, 279
N.W.2d 493 (Ct. App. 1979) (stating that failure to refute an argument constitutes
a concession).

¶33 Moreover, we agree with the Church’s argument that even if we
consider Sims’ argument, the argument is without merit. The Church argues that
WIS. STAT. § 181.0801 does not state that the only form of delegation of powers
that a corporation may use, is delegation by its members. It argues that the
provision in the statute that Sims cites is within a section describing the basic
duties and powers of a board of directors. It states that subsection (2) of the
statute states the general rule that “all corporate powers shall be exercised by or
under the authority of … its board.” Sec. 181.0801(2). The Church then argues
that boards of directors exercise all corporate powers unless they give authority to
someone else to exercise them. The Church further asserts that subsection (3)(a)
of the statute offers an alternative method of delegation of powers that would
bypass the board of directors—where “bylaws approved by the members” “may
authorize a person to exercise some or all of the powers which would otherwise be
exercised by a board.” Sec. 181.0801(3)(a). It argues that subsection (3) of the
statute does not undermine the inherent power of a board of directors, recognized

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No. 2022AP1590

in subsection (2) of the statue and is consistent with well-recognized law that a
board of directors may delegate its authority.

¶34 Sims argues that the Church did not make the argument that WIS.
STAT. § 181.0801(2) allows the board of directors to govern the Church affairs
before the circuit court. We note that Sims is correct that the Church did not cite
subsection (2) of the statute for that proposition in its original briefing before the
circuit court on its motion to dismiss—rather, it cited subsection (3)(a) for that
proposition. However, at the conclusion of the hearing on April 1, 2022, on the
Church’s motion to dismiss the amended complaint at which the parties made oral
arguments to the circuit court, the court ordered the parties to file “short letter
briefs referencing the documents and law the court should review and consider in
ruling on the [church’s] motion to dismiss.”13 In its letter brief, the Church argued
that Sims “does not challenge the [Church’s] argument that if the 2016 and 2019
Bylaws are invalid … the Church’s business affairs will be governed by the
Church’s board of directors pursuant to [WIS. STAT. §] 181.0801(2).” It then
quoted the statute “all corporate powers shall be exercised by or under the
authority of, and the affairs of the corporation managed under the direction of, its
board.” Thus, we conclude that the record reflects that the Church did make this
argument before the circuit court.

13
CCAP entries reflect that at the hearing on April 1, 2022, the parties made their
arguments and the court did order the parties to file short letter briefs. The court issued a written
order on April 12, 2022, regarding the letter briefs. However, we note that there is no transcript
of the hearing on April 1, 2022, in the appellate record, and instead, we take judicial notice of the
CCAP entry for the April 1, 2022 hearing. See Kirk v. Credit Acceptance Corp., 2013 WI App
32, ¶5 n.1, 346 Wis. 2d 635, 829 N.W.2d 522 (recognizing that CCAP, an acronym of
Wisconsin’s Consolidated Court Automation Programs, reflects information entered by court
staff of which the court may take judicial notice).

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No. 2022AP1590

¶35 Moreover, before the circuit court and on appeal, the Church also
argued that even absent the statute, the common law authorizes a board of
directors to delegate its powers to others. It cited Cassidy v. Uhlmann, 63 N.E.
554, 556 (N.Y. 1902), where the court stated, “it is clear that a board of directors
may delegate some of its powers to committees and individuals selected from the
board. This is common practice in the management of … corporations.” The
Church also cited to Carol A. Jones, 2 Fletcher Cyclopedia of the Law of
Corporations § 495 (2014), which notes, “The directors can delegate the power to
transact not only ordinary and routine business, but business requiring the highest
degree of judgment and discretion.”

¶36 Sims does not refute the Church’s argument in his reply brief, and
therefore, we conclude that Sims has conceded the Church’s argument. See
Charolais Breeding Ranches, 90 Wis. 2d at 109. Thus, we conclude that the
Church’s board of directors had the power to delegate the power to amend the
bylaws to Rev. Donnie Sims in the 2016 Bylaws, which he did in amending the
2019 Bylaws.

¶37 We next address the Church’s alternative argument that if the 1967
Bylaws were invalid, the 2016 Bylaws would be the Church’s initial Bylaws and
they were properly adopted by the board of directors.

IV. If the 1967 Bylaws were invalid, the 2016 Bylaws would be
the Church’s initial Bylaws and were properly adopted

¶38 As noted above, in its supplemental brief, the Church alternatively
argues that, if the Church’s members or its incorporator adopted the 1967 Bylaws,
those bylaws would be invalid and of no legal effect. “By-laws of a corporation
which are contrary to or inconsistent with its … governing statute, are ultra vires

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No. 2022AP1590

and void, even though they may have been unanimously assented to by the
stockholders or members.” Security Sav. & Trust Co. v. Coos Bay Lumber &
Coal Co., 219 Wis. 647, 653, 236 N.W. 187 (1935). It then asserts that if the 1967
Bylaws are invalid, the 2016 Bylaws would be the initial bylaws of the Church
and those bylaws were properly adopted by the Church’s board of directors under
WIS. STAT. § 181.0206, which was in effect at the time.14 The Church then argues
that the 2016 Bylaws were subsequently properly amended in 2019 by the
Church’s board of directors under WIS. STAT. § 181.0206.15

¶39 By contrast, in his supplemental brief, Sims argues that the bylaws to
amend the 1967 Bylaws in 2016 were approved by the members of the Church by
custom and acquiescence. He cites Graebner v. Post, 119 Wis. 392, 96 N.W. 783
(1903), and O’Leary v. Board of Directors, Howard Young Medical Center, Inc.,
89 Wis. 2d 156, 166, 278 N.W.2d 217 (Ct. App. 1979), in support of his argument.
He states that in Wisconsin “the court recognized adoption by custom and
acquiescence where bylaws were tentatively approved by members and applied for
a number of years, but never officially adopted.” However, Graebner is
distinguishable from this case. In Graebner, a set of bylaws were prepared and
approved at a stockholders’ meeting. Id., 119 Wis. at 393. No other bylaws were
thereafter or formally adopted by the board of directors. See id. Here, Sims does
not allege that the 1967 Bylaws were prepared and approved at a meeting of the
members. Further, unlike in Graebner, subsequent bylaws—the 2016 and 2019

14
WISCONSIN STAT. § 181.0206(1) provides “[t]he incorporators, members or board of a
corporation shall adopt the initial bylaws for the corporation.”
15
WISCONSIN STAT. § 181.0206(2) provides in part “[a]fter the adoption of the initial
bylaws under sub. (1), bylaws may be adopted either by the members or the board[.]”

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No. 2022AP1590

Bylaws—were prepared and adopted by the board of directors. Additionally, the
court in Graebner did not reference any statute that would govern who could
adopt the initial bylaws of a corporation.

¶40 By contrast, in O’Leary, the plaintiffs alleged that the 1972 bylaws,
as amended in 1975, were adopted by the membership by custom and
acquiescence, and thus, under WIS. STAT. § 181.13, the board of directors lacked
the power to amend them in 1977. O’Leary, 89 Wis. 2d at 165. This court
affirmed the circuit court ruling “that only by formal adoption procedures, taken at
a meeting of the members, could the membership have prevented the directors
from exercising their power to amend.” Id. at 165-66. The O’Leary court
recognized the holding in Graebner, but stated that “[h]owever, to extend the
concept to informal adoption by custom and acquiescence of bylaws regularly
promulgated and adhered to for some uncertain length of time would be contrary
to good policy.” Id. at 166. Here, Sims makes the same argument that the
O’Leary court rejected.

¶41 Thus, this court rejects Sims’ argument that the members could
adopt the 1967 Bylaws by custom and acquiescence. Therefore, we conclude that
if the 1967 Bylaws were passed by the members of the Church, those bylaws
would be invalid and the 2016 Bylaws would constitute the initial bylaws of the
Church and were properly adopted by the board of directors pursuant to WIS.
STAT. § 181.0206(1).

CONCLUSION

¶42 For the reasons stated above, we conclude that: (1) the allegations in
the amended complaint and the documents attached thereto, demonstrate that the
1967 Bylaws were properly adopted by the Church’s board of directors; (2) the

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No. 2022AP1590

1967 Bylaws provide that the bylaws may be amended by a two-thirds majority
vote of the Church’s board of directors; (3) the Church’s bylaws were properly
amended in 2016 and 2019; and (4) if the 1967 Bylaws were invalid, then the 2016
Bylaws would have been the Church’s initial bylaws and they were properly
adopted by the Church’s board of directors. Thus, the 2019 Bylaws currently are
the bylaws that govern the Church, and we affirm the circuit court’s order
dismissing Sims’ complaint.

By the Court.—Order affirmed.

This opinion will not be published. See WIS. STAT.
RULE 809.23(1)(b)5. (2021-22).

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