Can a rescue squad protect itself from local government accountability by becoming a non-stock corporation?

Monday, May 11, 2020

The Local Government Attorneys of Virginia hired Martin Crim of Vanderpool, Frostick & Nishanian P.C. to draft an amicus curiae brief in the Virginia Supreme Court case of Dumfries-Triangle Rescue Squad v. Board of County Supervisors of Prince William County. 

The case started when members of the rescue squad falsified operational records and the County’s Operational Medical Director refused to renew the operating license for the rescue squad. In response, the Board of Supervisors dissolved the Rescue Squad pursuant to statute and the agreement between the County and the Rescue Squad.

The Rescue Squad refused to wind up its affairs, however, claiming that its incorporation as a nonstock entity in 1959 made it immune to dissolution by the County. The Virginia Supreme Court allowed the appeal on the questions of whether the County had the authority to dissolve the Rescue Squad and whether the trial court was right to order the Rescue Squad to distribute its assets to the County.

The appeal presented the novel question of whether a rescue squad can unilaterally protect itself from local government accountability by becoming a non-stock corporation.

The amicus brief pointed out the state law has, since 1970, authorized local governments to regulate and even dissolve volunteer rescue squads, and similar laws apply to volunteer fire companies. Rescue squads are funded in large part with donations from private individuals and local governments, so the amicus brief argued that local governments need to have the ability to supervise, regulate, and, when necessary, dissolve rescue squads. State law has granted local governments those powers since 1970, and such laws affect rescue squads that existed before 1970 because the General Assembly has the power to affect existing corporations with new legislation designed to protect public health and safety.

* NO GUARANTEE OF RESULTS: Our prior results, including successful judgments and settlements, do not guarantee a similar outcome. Each case we handle is different and therefore we cannot guarantee any specific result in your case.