Category Archives: Property

An Interesting Tale Of Stewardship, Property, And The PC(USA) Trust Clause

A news item on Friday caught my attention and got me thinking. This is a brief recounting and reflection on that news item.

The news, from the DailyNewsonline.com, is that Oakfield Community Bible Church (OCBC), a congregation that can be traced back to the First Presbyterian Church, Oakfield, NY, of the Presbyterian Church (U.S.A.), purchased back its property from Genesee Valley Presbytery at public auction for $50,000. This property contains both the 11,740 sq. ft. church structure and the manse.

This history is, with a twist or two, simple and predictable: First Presbyterian wanted to leave PC(USA) over doctrinal differences, the Presbytery would not let them just take the property with them, after a brief attempt at negotiations the congregation filed a lawsuit for the property, and at trial the property was awarded to the Presbytery under the trust clause. Apparently the Presbytery decided not to continue using the property themselves and so auctioned it off. The successor church, now the OCBC was the successful bidder for $50,000. (There was a bit of bidding drama, check out the news story for more details.)

The one twist in here is that upon separating from the PC(USA) the congregation of First Pres. became the Oakfield Independent Presbyterian Church (OIPC) and a bit later the church split and the majority of the congregation followed the pastor to form OCBC. So, while no longer Presbyterian, OCBC in its membership represents the successor to First Pres. The remaining members of OIPC decided it was not worth appealing the trial court’s ruling. (Layman article)

So what questions does this raise?

First, for $50,000 did the Presbytery get anywhere near what they should have for the property? In scanning articles I have not seen the figures for what each side was talking in the brief negotiations. However, an article in The
Layman a week ago values the property at $398,000 and a comment in the minutes of a special meeting of Presbytery says “No appraisal has been done, but the worth may be greater than $200,000. The property is a valuable asset in the middle of the village.” The property
does not appear on the town’s 2005
tax rolls, but a residential property very close by had an assessed
valuation of $83,000. Even if the number in the Layman is a bit high
and we consider the minimum number the Presbytery listed, clearly the selling price at auction was no more than 25% of the
property’s value. It appears that other bidders at the auction were
only interested in the manse and were willing to bid $45,000-55,000 for
the whole property to get the house.

So, on the one hand the Presbytery appears happy to get the empty building off their hands so they don’t have to put money into maintaining a vacant property. In a depressed real estate market in a small western New York town they were able to unload a unique parcel of property. (And I am well aware of the current challenges related to selling a unique parcel. As chair of the trustees of the Synod right now I have a couple of “interesting” properties that we would like to find buyers for, especially if the offer reflects the value of the property. One city has offered us naming rights if we donate the property to them for a park.)

But on the other hand, we have to ask the question whether with some patience and work the Presbytery could have gotten more value out of the property. Yes, it probably would have required carrying it on the books longer and if not used for religious purposes carries the risk of losing tax exempt status. And I am sure that the Presbytery considered this. In addition, in defending the litigation they incurred expenses, some of which may have been offset by higher governing bodies or insurance.

On the other side of the equation the congregation is now back in the facility they were using before for what is probably a good deal. It has been vacant for a while and that carries concerns about the condition but basic upkeep seems to have been preformed. The flip side of this is that the church has been unsettled with some uncertainty and other arrangements for a couple of years. And in the auction process they did not have assurance that they would be the successful bidders.

So is this a win-win situation, at least as far as the property is concerned today? Presbytery gets vacant property off their hands, church gets to use their old facility again for a price that is 25% of the property value.

One does have to wonder if the Presbytery could have gotten more of the value out of the property. One also has to wonder if a negotiated settlement right at the very beginning may have gotten everyone a reasonable outcome without the expense, frustration and polarization of litigation.

I don’t know what the best answer is here but these are questions that come to mind as I read about the outcome of this property auction.

Indiana Court Awards Property To Particular Church And Not PC(USA) Presbytery And Synod

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This past week Judge Carl Heldt of the Vanderburgh Circuit Court, Indiana, issued his ruling in the case of Presbytery of Ohio Valley and Synod of Lincoln Trails, Presbyterian Church (U.S.A.) v. Olivet Presbyterian Church. This lawsuit was regarding the Olivet property which the higher governing bodies argued Olivet could not take with it as it disaffiliated from the PC(USA) and realigned with the Evangelical Presbyterian Church. The court ruled that after examining all the incorporation and real estate documents there was no evidence of a higher governing body ever having a legal interest in the property and so the congregation held clear title to it. Along with this the court ruled that under “neutral principles” the PC(USA) can not have an “implied trust” on the property since the ownership of the property is to be judged only by the documents applicable under civil law and not the Book of Order or other documents related to ecclesiastical law.

Thanks to The Layman you can read a scanned copy of the court decision. There is also reaction from The Layman.

Now, I would not normally devote so much time to reading and analyzing a trial court decision — I expect this decision to be appealed and I would rather devote the time to looking at the legal reasoning after it has had “peer review.” However, two things caught my attention in this decision…

First, after following the California Episcopal Churches case very closely a couple of years ago I found it interesting how essentially the same arguments played differently in the two courts. Now I do realize that the California cases hinged on a point of California corporate law that permits hierarchical churches to place an implied trust on property, and that getting to the California Supreme Court different lower courts and trial courts ruled in opposite ways on the issue.

But in this case the judge goes to great lengths to set the foundation for his ruling based on neutral principles. The decision is 29 pages long of which the Finding of Fact is roughly half at 13 pages. The Conclusions of Law takes up almost 14 pages (the balance is the preferatory material and the judgment order) and of those pages five and a half are a detailed analysis of case law and precedent, both in Indiana State Courts and U.S. Federal Courts, to set the foundation for his decision based on neutral principles. The bottom line here is that if the larger church has no presence in the civil documents (incorporation and real estate) the ecclesiastical documents are irrelevant. This decision quotes a U.S. Appeals court decision (Merryman v. Price, 1971) that relied on a U.S. Supreme Court Decision (PCUS v. Blue Hull, 1969) where it says:

It is clear that the civil courts can not rely upon ecclesiastical law of the church to impose an implied trust upon real estate.

and, regarding neutral principles, goes on to say:

This approach has the advantage of almost never involving a civil court with the vexing problem of whether preferred evidence is admissible under the First Amendment. Further adjudicating church property disputes by relying on formal title will ensure an almost evenhanded administration of justice since the necessary evidence will almost always be admissible. The formal title approach will seldom involve a civil court in deciding what the polity of a given church is, a determination which will almost inevitably involve ecclesiastical considerations. One final advantage inherent in this approach is that it invites and encourages religious organizations to title their property as clearly and unambiguously as possible.

I would add that in considering the formal title to the property this congregation has taken a slightly different path than many to their current affiliation. As the facts of the case detail, this was a mission plant of the Cumberland Presbyterian Church in 1891 but became part of the Presbyterian Church in the United States of America in the partial merger of 1906. It has now realigned from the PC(USA) to the EPC.

The second thing that caught my attention was the court’s attention to the polity of the PC(USA) as expressed in the Book of Order. Or maybe it is better to say the conflicts in the polity that make sorting out ecclesiastical disputes in civil courts difficult.

In point 8 of the Findings of Fact the decision says “Even the PC(USA) Constitution and Book of Order permits and acknowledges the possibility of movement away from its denomination.”

In point 18 of the Findings of Fact, “[T]here are no specific set of By-laws prescribed by the Book of Order or other authority of Plaintiffs.” (And I would add that the flexibility of nFOG will enhance this point.)

Point 20 presents the PC(USA) argument that as a congregation of the PC(USA) they recognize church governance while they voluntarily chose to be affiliated with the denomination. The church counters with the facts above, that there is provision for disaffiliating and that there is no set By-laws.

In the Conclusions of Law the court writes in point 7 “The Book of Order is cited by both parties and contains contradictory terms as it relates to property disputes.” It then goes on to cite G-9.0102 about church courts having only ecclesiastical jurisdiction and not civil authority.

And point 20 notes the discrepancy between the PC(USA) argument that this is a “dissolution” of the congregation while at the same time a paragraph in the stipulated facts that both parties are in agreement on states that “The Olivet congregation has consistently made it clear its intention to continue it affiliation and worship under the EPC…” and never expressed plans or interest in abandoning its property.

But the major piece of analysis of PC(USA) polity is point 19 which covers more than one page double-spaced (I figure my interested readers can figure out the Book of Order references so I have edited those for length):

19. Both parties cite various portions of the PC(USA) Book of Order in support of their respective positions.

Plaintiffs’ case significantly relies upon G-8.0201, added to the Book of Order in 1981, which states:

All property…is held in trust nevertheless for the use and benefit of the Presbyterian Church (U.S.A.).

Plaintiffs rely heavily on this and other provisions of Chapter 8 in the Book of Order in asserting its trust interests.

The Olivet Defendants reply asserting the Book of Order is an ecclesiastical document which by its very terms is not supposed to have civil law jurisdiction citing G-9.0102 stating:

Governing bodies of the church are distinct from the government of the state…

Both parties assert many other provisions of the Book of Order all of which are part of the record. Olivet also cites the Affidavits Alex Merwin and William Rasch. Irrespective of the affidavits, the court concludes that wading into various provisions of the Book of Order which may or may not be conflicting requires this Court to determine ecclesiastical questions in the process of resolving property disputes which is prohibited by the First Amendment to the United States Constitution. [cite removed] Plaintiffs ask this court to hold that pursuant to
G-8.0201, the Olivet property is held in trust for the use and benefit of the Presbyterian Church (U.S.A.) and yet Defendants assert that G-8.0201 is not a settlor’s declaration but an assertion by an entity that does not hold title to any of the property at issue in the instant case and which never held property at issue in the present case. Plaintiffs assert the actions of its Presbytery consisting of voting members of various churches must be upheld while Defendants cite Chapter G-9.0102, stating governing bodies of the church (i.e., a Presbytery) have only ecclesiastical jurisdiction. As further example, G-1.0307 of the Book of Order states: “That all church power, whether exercised by the body in general or in the way of representation by delegated authority is only ministerial and declarative…” At G-1.0308 it states “Any ecclesiastical discipline must be purely moral or spiritual in its object and not intended with any civil effects…” This conflict and the other potentially conflicting provisions in the Book of Order appear to this Court to force an evaluation or determination or ecclesiastical questions or interpretations in the process of resolving this property dispute. This Court declines to do so, based upon the First Amendment to the United States Constitution, the Indiana State Constitution, U.S. Supreme Court precedent and state court precedent. “Civil courts will be bound to give effect to the result indicated by the parties, provided it is embodied in some legally cognizable form.” Jones v. Wolf, 443 U.S. 595, 606 (1979)

In other words: The Court leaves the sorting out of the Book of Order to church judicatories and polity wonks — it is not their business. (I wonder if the nFOG would help or hurt the case?)

As I stated before, this could have a long way to go through the appeal process. And it is clear that state law and precedent have significant implications in all of these property cases. While there is some hope that one day the U.S. Supreme Court will take one of these cases and use it to set clear legal tests for when neutral principles versus church government theories apply, so far this term the high court has declined to hear two cases that have asked for a hearing so this situation still relies on state law and so varies between the states.

We will see where this particular case may lead us.

Church Property Case Not Accepted By Supreme Court… At This Time

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It is the first Monday in October and that means two things…

They begin announcing the Nobel Prizes for this year and…
The U.S. Supreme Court begins its new term.

Now, I will leave the Nobel Prizes (and their humorous cousins the Ig Nobel Prizes) to you. (Although it does strike me that there is something theologically significant about the fact that cows with names give more milk than cows without names. See the Ig Nobel award for Veterinary Medicine.)

But with the start of the new Supreme Court year it brings a list of the cases that the court has agreed to hear, and the vastly longer list of those the Court will not hear.

For those looking for a Supreme resolution to the diversity of views and court decisions on church property, the trust clause, and neutral versus hierarchical principles, we won’t have it from the national court this year. The Court has declined the request of St. James of Newport Beach to have their California high court decision reviewed. If you look at the list of court orders you will see that their case, 08-1579, is just one in an approximately 80 page list of cases that the court has declined to hear, almost all with out comment.

What this means is that the case goes back to trial court as the California supremes ordered. It also means that once the trial court has rendered a decision the case can once again make its way through the appeals system and possibly have another shot at the U.S. high court. There is also a possibility that a different property case could make it there first.

As always, for the legal context, interpretation and decoding into plain English check out the Anglican Curmudgeon.

And the story continues.

A Great Summary Of Church Property Law

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If you follow the news and analysis of church property cases floating around right now you probably already read the Anglican Curmudgeon. Mr. Haley’s legal knowledge, analysis and insights are very helpful in tracking and understanding the developing and sometimes confusing court cases that are out there. And while he primarily tracks the twists and turns of the Anglican/Episcopal legal disputes, property and otherwise, as I have regularly observed there are implications for the Presbyterian Church (U.S.A.) cases as well.

Well, in a recent post Mr. Haley noted and included the recent (Sept. 18) decision of the South Carolina Supreme Court case of All Saints v. Campbell. For those who view the law to say that church property belongs to the local congregation this is one of the rare higher court decisions in their favor. But I bring this decision, and Mr. Haley’s blog post, to your attention because it is also a very clearly written decision with a very good discussion of the current case law regarding hierarchical denominations. As the Curmudgeon says:

The opinion is so clear and well-written, in fact, that there is
scarcely any need to translate the greater part of it for a lay person.

So, if you want a nice introduction to the legal background in these cases I can do no better than to refer you to either the decision, or his mildly annotated presentation, and suggest you begin at the section that is headed “Law/Analysis.” Towards the end it does get specific to South Carolina when it reviews and elaborates on a previous ruling in that state court which presented the rule to apply for neutral principles cases in that jurisdiction. But it is really only at that point that the legal jargon really starts to be used.

You will notice that although this is a state court decision, it does a nice job of explaining the U.S. Supreme Court decisions and their application to previous state cases. In addition, you will also see how many of these cases involve disputes at Presbyterian churches, probably more than any other denomination, going back over 100 years to the original U.S. Supreme Court decision in Watson v. Jones in 1871.

As with many of these cases the decision involves details specific to this church and South Carolina (e.g. Colonial English Law still in effect) which the Curmudgeon points out is not applicable elsewhere. If you are interested in these matters it does make for interesting reading, but for the general national perspective you can stop at the end of the Law/Analysis section.

Very interesting reading. Thanks for the pointer and the commentary Mr. Haley.

Seeing Double — Recent Developments in the U.S. Anglican/Episcopal Church

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Yes, this is still a Presbyterian blog and I don’t plan on regularly covering the Anglican and U.S. Episcopal church. But I do drift off in that direction on occasion, like now, when the developments either (1) intersect with Presbyterian politics, or (2) are interesting to a polity wonk or GA Junkie. Both cases are true at the moment.

The major news with significant implications for hierarchical churches in the United States, including the Presbyterian Church (U.S.A.) is that the St. James Church case from California has now been officially appealed to the U.S. Supreme Court. This has been reported by Anglican Mainstream, Stand Firm, and VirtueOnline. But as usual, if you want a detailed analysis you look to the Anglican Curmudgeon. He has started a series of posts on the Constitutional arguments why the Court should over turn the California Supreme Court Decision on First Amendment Establishment Clause issues. From the petition to the Court for review he quotes one of the arguments:

I. The California Supreme Court Has, By “Legislative Fiat,” Empowered Self-Proclaimed Hierarchical Churches to Unilaterally Create Trust Interests For Themselves in the Property of Affiliated Local Church Corporations, Impermissibly Preferring Hierarchical Religion and Infringing on the Free Exercise Rights of Local Congregations.

Now I need to think this through a bit more myself, and the root of this case is a specific section in the California Corporate Code that applies only to hierarchical churches, based on the 1979 Supreme Court decision setting forth “neutral principles.” I do wonder if there is a logical conclusion if generalized further — If under the establishment clause the state can not make or enforce laws that relate to the hierarchical church being able to govern a congregation without that congregation’s explicit consent, then does it effectively reduce all congregations to being able to opt-out effectively reducing the denomination to a congregationalist government. Again, I will say that I am thinking generally about something that, if accepted by the court, will be tried on very specific merits and that has gotten me in trouble before.

(In an interesting related case there is a brand new state appeals court decision that affirms that the Assemblies of God church is a hierarchical denomination.)

A second news item related to the PC(USA) is that the Episcopal Church will vote at its General Convention in two weeks on an agreement for full communion with the Moravian Church. A similar agreement with the Moravian Church was agreed to by the last PC(USA) General Assembly and affirmed by the vote of the presbyteries. In reading Mark Harris’s endorsement of the Episcopal-Moravian agreement I also learned that the Episcopal Church has a full communion agreement with the ELCA, again like the PC(USA).

(Another aside – while the PCA may have had their General Assembly at the second “Happiest Place on Earth^®,” Orlando, Florida, the Episcopal Church will have their Convention at the first “Happiest Place on Earth^®,” Anaheim, California. (And yes, the phrase is a registered trademark of the Mouse House.))

Now, in case you missed it, the big news coming from the Anglican/Episcopal branches in North America is the establishment this week of the Anglican Church in North America (ACNA). This church is intended to be a parallel church to the Episcopal Church in the U.S. and the Anglican Church of Canada but with a conservative stance. The inaugural assembly in Bedford, Texas, had all the attendant pomp and ceremony including the installation of an archbishop for this new province of the Worldwide Anglican Communion. The problem is of course that while it has been recognized by several other Provinces, mostly in the southern hemisphere, it has not been recognized yet by the whole communion and certainly not by the currently existing provinces on these shores. But, in one ecumenical relationship the ACNA was recognized by the leader of the Orthodox Church in America. Another endorsement of the new province came from the Rev. Rick Warren who addressed the Assembly last Tuesday Morning. To say “This could get interesting” would be an understatement.

And finally, the Episcopal Diocese of San Joaquin in California gives us our polity question of the week — If the vote of a diocesan convention is necessary to elect a bishop but that convention does not have a quorum what do you do? Specifically, on March 29, 2008, 21 clergy were present at the meeting and 61 were absent. Under the church canons a quorum for such a meeting is one-third plus one or 28. The bishop’s answer was to go ahead and have the convention elect him, then depose the 61 who did not show up, sort of giving a retroactive quorum. I have simplified this a great deal, but the situation is very real and plays into the California trial court case concerning the situation of property when not just a congregation but a significant portion of the diocese chooses to leave a denomination together. As always, check out the Anglican Curmudgeon for the details and keep watching the news to see what the civil courts do with this.

Church Property Case Headed For The U.S. Supreme Court

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I was right in concept but picked the wrong case. My money was on Episcopal Diocese of Rochester v. Harnish for the first case to go to the U.S. Supreme Court to clarify issues of church property and the trust clause. That was the case earlier decided by a state supreme court (New York) as opposed to the case of St. James Episcopal Church, part of the California Episcopal Church Cases. The California Supreme Court sent that back down to the trial court to have it heard and decided based on the concept of “neutral principles.”

Well, St. James Church announced yesterday that it would ask the U.S. Supreme Court to review the California Court decision. As the press release on the church web site says:

St. James Anglican Church, at the centerpiece of a nationally
publicized church property dispute with the Episcopal Church, announced
today that it will file a petition for writ of certiorari with the
United States Supreme Court to resolve an important issue of religious
freedom: Does the United States Constitution, which both prohibits the
establishment of religion and protects the free exercise of religion,
allow certain religious denominations to disregard the normal rules of
property ownership that apply to everyone else?

To put the legal question another way – “Can a hierarchical church impose a property trust clause on a particular church without their explicit consent” as the California Supreme Court decided. Or to put it another way, when the trust clause was added to the Episcopal Canons did the individual churches implicitly agree and accept them. Hierarchical churches are the one case where California law allows a trust to be imposed on a corporation. The particular church wants a decision if that is constitutional. (Yes, I am highly simplifying the legal issue here while hopefully still conveying the essence of the question.)

I must admit that as I look over these cases again I have to think “be careful what you ask for.” The majority California decision was argued that it was based upon neutral principles of law while basically siding with the hierarchical church in this case. Justice Kennard’s separate decision basically called the rest of the court on this and said “if you are going to side with the hierarchical church in this way at least be honest and call it principle of government.” And J. Kennard is very direct about it:

In my view, Corporations Code section 9142 reflects the principle of government approach. That statute allows a hierarchical church, such as the Episcopal Church here, through its bylaws to unilaterally impose a trust on the property of a local member parish. The statute does not state a neutral principle of law; rather, it creates a special principle applicable solely to religious corporations.

I’m not sure I would wager money that the U.S. Supreme Court would take this approach, but I could see them concurring with this overall case but using it to strengthen the principle of government theory. My thoughts on it and I’ve been wrong before.

So we are back to watching this move through the judicial process. We will have to see if the court accepts the case, when arguments are heard and when a decision is handed down. Clearly this process will take a year if not more. But the decision will affect court cases in multiple denominations with many different individual cases now in the courts.

Gracious Witness — The World Does See It

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The World is watching… And the World has noticed. (At least here in California.)

As much as we are concerned about the confusion, anxiety, and uncertainty in the future of the Presbyterian Church (U.S.A.), at this moment events are moving faster in the Episcopal Church and their local churches that are realigning with other Anglican Provinces. The California Supreme Court cases, while they will have an impact on Presbyterians, were about Episcopal Churches here in Southern California. The bishop is offering reconciliation but the churches are looking ahead to the cases being heard in trial court. And there are more church cases waiting in the wings (e.g. St. John’s, St. Luke’s). The Presiding Bishop’s office has brought on new high-power legal talent. Meanwhile a SoCal megachurch has offered to have displaced Anglican churches nest on their property.

At a higher level, while the PC(USA) has some unhappy presbyteries, the Episcopal Church has four diocese that have realigned with other provinces and are looking at a new North American province. Here in California the Episcopal hierarchy has set up a new San Joaquin diocese along side the realigned one and is trying to figure out how the new court decision might help them there. And in Fort Worth the Presiding Bishop herself will be stopping by in a couple of weeks to lead a special meeting to bring the diocese back into the fold.

So, in the midst of all this discord what is the good news? The Modesto Bee has noticed that while the Presbyterians and the Episcopalians have similar problems, the way they are handling them is different. In an article titled “Presbyterian Splits Lack Episcopalian Litigiousness” they compare how the the two denomination are handling church departures and observe “[M]any of the Presbyterian churches have been allowed to leave “with
grace” and their property, as opposed to the Episcopalian parishes and
dioceses that have been sued across the country.” It is nice to see that the “gracious witness resolution” passed by the 218th General Assembly may be bearing fruit, not just in the life of the church but as a witness to the world. As one of the points of the resolution says:

Gracious Witness: It is our belief that Scripture and the Holy Spirit require a gracious witness from us rather than a harsh legalism

California Supreme Court Decision: Denomination Controls The Property

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The California Supreme Court decision has been issued: In a unanimous decision on the outcome they upheld the appellate court decision which found in favor of the national Episcopal Church and against the local churches. The majority found that under “neutral principles of law” the property resides with the denomination because the churches agreed from their founding to be part of the greater church and abide by their documents. (The appellate court used “principle of government” in its reasoning.)

The majority decision, written by Justice Chin, goes on to present the legal rational for this finding. In a very interesting concurring and dissenting individual opinion Justice Kennard says, and I paraphrase here, “I agree the higher church body gets the property, but you are really stretching California law in finding for neutral principles when this should be based on principle of government.”

So we basically have a unanimous decision, but a 6-1 split on the legal reasoning.

Now some details, and I’ll quote extensively from the very readable introductory summary to the decision.

Near the beginning of the summary it says:

When secular courts are asked to resolve an internal church dispute over property ownership, obvious dangers exist that the courts will become impermissibly entangled with religion. Nevertheless, when called on to do so, secular courts must resolve such disputes. We granted review primarily to decide how the secular courts of this state should resolve disputes over church property.

State courts must not decide questions of religious doctrine; those are for the church to resolve. Accordingly, if resolution of the property dispute involves a doctrinal dispute, the court must defer to the position of the highest ecclesiastical authority that has decided the doctrinal point. But to the extent the court can resolve the property dispute without reference to church doctrine, it should use what the United States Supreme Court has called the “neutral principles of law” approach.

The decision summary continues with this important paragraph, the one Justice Kennard takes issue with:

Applying the neutral principles of law approach, we conclude that the general church, not the local church, owns the property in question. Although the deeds to the property have long been in the name of the local church, that church agreed from the beginning of its existence to be part of the greater church and to be bound by its governing documents. These governing documents make clear that church property is held in trust for the general church and may be controlled by the local church only so long as that local church remains a part of the general church. When it disaffiliated from the general church, the local church did not have the right to take the church property with it.

Within the full discussion the majority say that important in the reasons they were favoring neutral principles is because “that is the [U.S.Supreme] court’s most recent on this subject and, hence, is of critical importance to the instant dispute.” They also quote the U.S. Supreme Court decision about the dangers of neutral principles including that it requires a court to examine church documents, such as a constitution, for a trust clause but the court must avoid deciding based on any associated doctrine in the document. And the decision notes that this is the first case the state supreme court has had to consider neutral principles since its development.

Related to this the decision notes that the Appellate decision in this case criticized previous appellate decisions because those decisions used neutral principles when the state supreme court’s previous rulings had used principle of government. This current decision responds:

We disagree. As explained in the Court of Appeal opinion containing the most thorough examination of this question… the principle of government method… and the neutral principles method… are not mutually exclusive, but can be reconciled. In any event, this court unquestionably has authority to adopt the neutral principles approach. [citations removed for length]

This makes it sound like another reason the majority went with neutral principles was to help set the record straight on the previous decisions.

It is also important to point out that in response to the 1979 U.S. Supreme Court decision detailing neutral principles the California Legislature, in 1982, added a section to the California Corporations Code recognizing a denominational trust clause. And the decision reaffirms that under this California statute a hierarchical church can unilaterally impose a trust clause if “the governing instruments of that superior religious body so provide.” There is an argument in the Episcopal Church that the trust clause was not properly adopted in the first place. The court literally says that “it is a bit late” to argue that point.

It is also interesting that in the full decision the court points out that most of the decisions in other states have favored the hierarchical church.

In the separate decision, Justice Kennard writes of the majority’s reasoning regarding the California Corporate statute:

But that conclusion is not based on neutral principles of law. No principle of trust law exists that would allow the unilateral creation of a trust by the declaration of a nonowner of property that the owner of the property is holding it in trust for the nonowner. [citation removed] If a neutral principle of law approach were applied here, the Episcopal Church might well lose because the 1950 deed to the disputed property is in the name of St. James Parish, and the Episcopal Church’s 1979 declaration that the parish was holding the property in trust for the Episcopal Church is of no legal consequence.

But under the principle of government approach, the Episcopal Church wins because that method makes the decision of the highest authority of a hierarchical church, here the Episcopal Church, binding on a civil court. This result is constitutional, but only because the dispute involves religious bodies and then only because the principle of government approach, permissible under the First Amendment, allows a state to give unbridled deference to the superior religious body or general church.

In my view, Corporations Code section 9142 reflects the principle of government approach. That statute allows a hierarchical church, such as the Episcopal Church here, through its bylaws to unilaterally impose a trust on the
property of a local member parish. The statute does not state a neutral principle of law; rather, it creates a special principle applicable solely to religious corporations.

In my common sense way of thinking Kennard’s argument makes more sense to me as a path to ruling for the denomination.

Finally, a couple of polity and legal observations from this GA Junkie, who is not a lawyer.

1) It is interesting that neutral principles was the legal theory that prevailed because one of the internal arguments among PC(USA) denominational people was whether trust clause (neutral principles) versus administrative commission process (principle of government) was a stronger argument. At least in this state it appears trust clause prevails. Personally, I favor process. It seems so much more Presbyterian to me.

2) In reading through the detailed decision it seems to me that the court has tried to position its decision so that it will be upheld on appeal to the U.S. Supreme Court, should there be one. It seems that great effort is taken to lay out the legal history in U.S. Supreme Court decisions to show how this decision is completely compatible with that court’s
existing decisions. Maybe another reason the majority went with neutral principles. And being a lowly physical scientist by training, maybe this is what all legal decisions look like.

3) There are clear winners and losers. But one of the winners may be those churches which have been already been gracefully dismissed by their presbyteries. If principle of government had prevailed I could imagine an increase in the pressure to use PJC’s and AC’s at higher levels to chase down and pull back congregations dismissed by their presbyteries. This decision does, of course, only apply to California.

Lastly, I do expect a lot of spin and discussion on this. But out of all the responses, I appreciate the detailed and disagreeing analysis of an authentic church lawyer over at Anglican Curmudgeon. We will see what others have to say. Stay tuned…

Updates: A few details I missed the first time around…
1) The case is not over — If nothing else the cases are sent back to the trial courts. And if the local churches are unsuccessful there some are suggesting that it will be taken to the U.S. Supreme Court.

2) In comments that I am trying to decide suggest a true sense of victory or just making the best of this outcome, some associated with the local churches are happy the majority relied on neutral principles since that is how they were arguing their case. As the article from VirtueOnline says:

The California Supreme Court today ruled in Episcopal Church Cases that
church property disputes must be resolved by “neutral principles of
law,” not by civil courts merely deferring to the decrees of church
“hierarchies.”

This ruling has wide and favorable impact for
churches throughout California that seek to change their denominational
affiliation. While adopting this “non-religious” method of resolving
property disputes between churches, the Court seemed to defer to the
Episcopal Church’s alleged “trust canon,” which purports to create a
trust interest in church property owned by local congregations.

And the press release from the Episcopal Church quotes the local churches lawyer, Eric Sohlgren:

What’s good about the decision from the perspective of St. James is
that the court has adopted a rule of neutral principles of law in that
church property disputes will be resolved by neutral, nonreligious
factors.

Interesting to see how this goes from here.

3) And on my commute home last night I heard one radio station give the following “teaser headline” that seems to miss the point of the “neutral principles:”

California Supreme Court rules for Episcopal Church in dispute over gay bishops and property

Looking Ahead To Monday

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It’s Saturday, but Monday’s coming…

The holidays are over, I’m still trying to keep Christmas in my heart and soul while recovering from New Years and the distraction of medical issues in my family over the break. I will need time to reflect on how “real life” intrudes into the divine. It seems like I should be seeing it the other way around since God takes the initiative. And my wife commented to me today that this is the first day she has really seen me since her father was hospitalized. (The situation is better, he is home, but the issues are not over and it will be a long road ahead for everyone.)

So, with the end of the holidays will come Monday and a return back to work. And with the return back from Christmas break we anticipate some news.

First, and scheduled, is the decision on the Episcopal Church Cases from the California Supreme Court. Notice was posted on Friday that the decision would be handed down at 10:00 AM PST on Monday. I have discussed this case before (see the tail end of this post) because even though this decision is specifically about Episcopal churches, it will set the “lay of the land” for all the hierarchical churches in California, including the Presbyterians. In light of that several Presbyterian entities submitted amicus briefs. The case was argued back in early October (my observations on the oral arguments) so now being close to 90 days the decision was expected this week. With the imminent decision the Anglican Curmudgeon has started a detailed series of posts on the cases and he promises to finish up with his prediction of the outcome. The first article is very good background piece, and the rest should be just as good. Even after almost 90 days I am sticking with my impressions from the oral arguments: I’m not sure if Neutral Principles or Principle of Government will specifically prevail but I’m still leaning towards Government. However, based on the tone of the jurists in October, I’ll stick my neck out that the hierarchical church will prevail in this one. (And from some of the arguments I could see the denomination prevailing even if a majority favors Neutral Principles.) I’ll post a brief summary as soon as I can find time in my work day to review the decision.

Second, and hinted at, is the appointments to the Special Committees, Study Groups, and Task Forces created by the last General Assembly of the PC(USA). In his Moderator Monday from December 15, GA Moderator Bruce Reyes-Chow gave an update on the appointment process and said he hopes to have it finished up “by the end of the year.” With the realities of the Christmas season I am not surprised that the announcement has not been made yet, but based on that goal I anticipate seeing announcements this coming week, maybe as early as Monday. And Bruce’s comment that “not everyone is going to be happy with all the choices made” and for people to “trust the Spirit” has raised my curiosity about their composition. Again, we await developments, maybe this week.

So my Christmas break is over. As I promised myself before the holidays I did some blogging but did not get consumed in any major analysis pieces. However, I’ve got a couple outlined and with breaking developments, and a slightly lightened work load with no teaching this quarter, I anticipate a resumption of my obsession with The Politics of Presbyterianism. So Happy (Gregorian) New Year (as opposed to the liturgical one was a month ago) and hang on for the ride.

The Legal Cases Over Property — Counting The Cost

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The Presbyterian Church (U.S.A.) came out of its 218th General Assembly with an interesting tension. On the one hand, it created a $2 million dollar legal fund to help presbyteries with legal costs of fighting churches wanting leave the denomination with their property. (PC-biz and my post) On the other hand, it passed a resolution “urging a gracious, pastoral response to churches requesting dismissal.” (PC-biz and author’s comments)

Much of the legal action that has happened in the last couple of weeks was in process at the time of GA and I find interesting the tension, or paradox, that each side had in the arguments before the California Supreme Court two weeks ago. From the congregations’ point of view, in spiritual matters the congregation agreed to the denomination’s rules, but the property is not a spiritual matter. From the denomination’s perspective, in this and other cases, if a church chooses to leave the denomination that is one thing, but they can’t take their property with them. So we are getting the property separated from the spiritual and the mission aspects of the church.

As you have probably heard, in another current property battle Kirk of the Hill Presbyterian Church in Tulsa, OK, has decided by a narrow margin to buy back their property from Eastern Oklahoma Presbytery after the court awarded the property to the presbytery upon the Kirk’s departure from the PC(USA) to the EPC. The congregation’s vote was 508 to 483 to pay the Presbytery $1.75 million for the property settlement. (More details in the Tulsa World article)

In the midst of these court battles and financial settlements individuals are beginning to ask the question about the financial cost of these actions and how it diverts resources from the mission of the church.

One person who has publicly asked this question is Dr. Richard Mouw, PC(USA) elder and President of Fuller Theological Seminary. In his October 13th Mouw’s Musings he talks about a conversation with a friend who suggests that the disputing sides should negotiate a compromise and contribute the amount they would have spent on legal costs to the care of AIDS orphans in Africa. Dr. Mouw notes:

The mainline Presbyterian (PCUSA) denomination to which I belong is
experiencing many property disputes right now, as some congregations
are leaving for what they see as greener ecclesiastical pastures. When
you look at the issue historically, it is a bit ironic that the leaders
of major Protestant denominations are so adamant in their right to hold
onto church properties, against the claims of the dissenters. At the
time of the Reformation the Protestants grabbed hold of Catholic
properties with abandon—monasteries and convents as well as places of
worship—and they also simply destroyed much of the contents of those
buildings: statues, altars, and the like. And all of this was done
without any respect for the claims of those who had strong moral and
legal claims to ownership of those properties. To the “breakaway”
groups belonged the spoils.

And he closes with this:

Such an arrangement [the contributions to AIDS orphans] would have important spiritual benefits. It would
help both sides to see themselves as using our disagreements to
accomplish something together for the Lord’s work. And it could help to
reduce our anger toward each other, presenting all parties with an
opportunity to be gracious toward our opponents.

The second article along these lines comes from Jim Oakes on the blog VirtueOnline where he points out that in the Virginia Episcopal cases millions of dollars have been spent on both sides in the legal action when “so many alternatives have been available.” While he notes that the issues are important and complex he also says “We can only hope and pray that Episcopal leaders will realize that the
high cost of this litigation has not done one thing to further the
mission of God’s church in any way.”

So what we as the church do is an important witness to the world about our faith and life. Yes, I know that there are a variety of circumstances and in different cases different parties have exercised the legal option first. But in this do we all consider the way the world views it and in the end, if the denomination is left with an empty building, what has been accomplished? It is interesting that Dr. Mouw uses the phrase “opportunity to be gracious toward our opponents.” Remember the central part of what the GA passed in June placing responsibility on all parties:

2.
Believing that trying to exercise this responsibility and power through
litigation is deadly to the cause of Christ, impacting the local
church, other parts of the Body of Christ and ecumenical relationships,
and our witness to Christ in the world around us, the General Assembly urges congregations considering leaving the denomination, presbyteries, and synods to implement a process using the following principles:

Consistency: The local authority delegated to presbyteries is guided and shaped by our shared faith, service, and witness to Jesus Christ.

Pastoral Responsibility: The
requirement in G-11.0103i to consult with the members of a church
seeking dismissal highlights the presbytery’s pastoral responsibility,
which must not be submerged beneath other responsibilities.

Accountability: For a governing body,
accountability rightly dictates fiduciary and connectional concerns,
raising general issues of property (G-8.0000) and specific issues of
schism within a congregation (G-8.0600). But, full accountability also
requires preeminent concern with “caring for the flock.”

Gracious Witness: It is our belief that Scripture and the Holy Spirit require a gracious witness from us rather than a harsh legalism.

Openness and Transparency: Early, open
communication and transparency about principles and process of
dismissal necessarily serve truth, order, and goodness, and work
against seeking civil litigation as a solution.