Nonprofit Mutual Benefit Corp. Law › CHAPTER 1. Organization and Bylaws [7110 - 7160] › ARTICLE 4. Powers [7140 - 7142]

(Amended by Stats. 1979, Ch. 724.)
Text current as of August 17, 2026, per California Legislative Information.

(a) Notwithstanding Section 7141, in the case of a corporation holding assets in charitable trust, any of the following may bring an action to enjoin, correct, obtain damages for or to otherwise remedy a breach of the charitable trust:

(1) The corporation, or a member in the name of the corporation pursuant to Section 7710.

(2) An officer of the corporation.

(3) A director of the corporation.

(4) A person with a reversionary, contractual, or property interest in the assets subject to such charitable trust.

(5) The Attorney General, or any person granted relator status by the Attorney General.

The Attorney General shall be given notice of any action brought by the persons specified in paragraphs (1) through (4), and may intervene.

(b) In an action under this section, the court may not rescind or enjoin the performance of a contract unless:

(1) All of the parties to the contract are parties to the action; or

(2) No party to the contract has, in good faith, and without actual notice of the trust restriction, parted with value, under the contract or in reliance upon it; and

(3) It is equitable to do so.

Related sections: § 7141 · § 7710

The text of the Nonprofit Mutual Benefit Corporation Law is provided for reference and convenience only, from the California Legislative Information website (leginfo.legislature.ca.gov). It is not legal advice, and the official version of California statutes is published by the state. Statutes may have been amended after the “current as of” date shown above. Consult counsel regarding the application of any statute to your association.