Ohio attorney general’s office joins lawsuit, says ‘PCUSA-style church’ must be provided
By Patrick Jean, May 30, 2007
The Ohio attorney general’s office has sided with Eastminster Presbytery in a lawsuit brought against it by a church seeking to leave the Presbyterian Church (USA) with its property.
Hudson’s motion for summary judgment
Eastminster’s motion for summary judgment
Ohio attorney general’s response
Hudson’s reply brief to attorney general The response filed by Attorney General Marc Dann seeks a summary judgment declaring that Hudson Presbyterian Church in Hudson, Ohio, holds all of its property and assets in a charitable trust that must “provide the public with a PCUSA-style church with the attendant community benefits of such a church.”
The summary judgment, Dann argues, also should declare that Hudson Presbyterian Church “may not apply the corpus of that trust for a purpose that is inconsistent with the purpose of providing the public with a PCUSA-style church.” Dann also requests that a court-appointed receiver administer the trust until a new trustee is appointed because Hudson Presbyterian Church “can no longer serve as trustee over that trust property.”
The attorney general’s response filing “lacks any merit” and is “unsupportable and ridiculous,” argues the church’s attorney, Forrest A. Norman III of Hudson, Ohio, in a reply brief.
A constructive charitable trust should not be imposed, Norman argues, because the church’s articles of incorporation “clearly state … that its association with a denomination is voluntary, and because the attorney general has offered no evidence demonstrating that HPC’s donors believed that its affiliation could never end.”
Hudson Presbyterian Church and Eastminster Presbytery each have also filed a motion for a summary judgment, as well as a reply brief that supports its motion and opposes the other side’s motion.
The chief magistrate for Summit County Common Pleas Court, John Shoemaker, will review the filings and recommend a verdict to Judge Mary F. Spicer. The plaintiff or defendants have 14 days to object to the magistrate’s report after it’s filed, said one of the presbytery’s attorneys, Terrence L. Seeberger of Akron. Spicer would rule on any objection, and her options for the magistrate’s report include accepting all or part of the recommended verdict, or rejecting the recommendation in favor of her own verdict.
There is no timetable for Shoemaker to complete his review.
What’s next?
While there is no time frame for Shoemaker to complete his work and make a recommendation to Spicer, a two- to three-month window from the last filing – in this case, May 14 – is standard, Norman said.
Whatever verdict is rendered would become final after 30 days if no appeals are filed during that time. But Norman said he expects to be filing or responding to an appeal.
The possibility of a settlement seems slim. Norman said the presbytery’s attorneys, Seeberger and T. Christopher O’Connell, both of Akron, have rejected settlement negotiations. Seeberger said it would be up to Norman to initiate any further attempts at a settlement.
Hudson Presbyterian Church has a 15-member “future search committee” exploring affiliation options, said Hudson’s pastor, the Rev. D. Wayne Bogue. The congregation wanted more study about whether to affiliate with the Evangelical Presbyterian Church, he said.
Affiliation options include the EPC; the proposed New Wineskins Presbytery within the EPC; or going independent. The session is scheduled to meet next month to discuss them, Bogue said.
“We will stay Reformed,” he said.
Attendance has actually risen during the disaffiliation battle, with some new members joining, Bogue said. “There’s a vitality here,” he said, “that’s very positive.”
Months in the making
The seeds for disaffiliation may have first been sown Jan. 8, 2006. That’s when the Hudson Presbyterian Church session approved three key changes to the church’s articles of incorporation:
- The corporate name of the church was changed from “Hudson Presbyterian Church (USA)” to “Hudson Presbyterian Church.”
- The purpose and object of the corporation includes voluntary association “with a denomination such as the Presbyterian Church (USA), as may be appropriate to carry out the dictates of conscience and the greater purposes of being His church.”
- The trust property relationship with the PCUSA was changed to state that “Any property held in trust, or deemed to be held in trust, shall be in a revocable trust, unless expressly stated otherwise in writing, such powers being expressly reserved by this corporation.”
That summer, the 217th General Assembly of the PCUSA approved the Peace, Unity and Purity report that keeps the current ordination standards in the denomination’s constitution, but allows those who choose not to obey them to declare them to be non-essential. That report’s approval has been cited as the last straw by a number of churches that have sought disaffiliation from the PCUSA since then.
Bogue said the last straw for his church was both the PUP report and the 217th General Assembly’s receiving of a theological paper that proposes both the Biblical tradition for the names of the Trinity – Father, Son and Holy Spirit – as well as a number of alternative names never linked in Scripture as Trinitarian language.
On Sept. 17, 2006, the session of Hudson Presbyterian Church voted unanimously to recommend that its congregation leave the PCUSA for the smaller, more conservative Evangelical Presbyterian Church. Eleven days later, the session – concerned that Eastminster Presbytery would attempt to remove the pastor and replace the session with an administrative commission – filed a motion for a temporary restraining order. That request was signed by Judge Spicer.
On Oct. 5, Eastminster Presbytery filed its own motion for a temporary restraining order that would have enjoined Hudson Presbyterian Church from taking “unauthorized actions to the detriment of congregation members, Eastminster Presbytery and [the] PCUSA.” Specifically, the presbytery expressed concern that the church would “attempt to transfer title of its property despite the fact that all property held by Hudson Presbyterian is held in trust for the use and benefit of the PCUSA.”
The next day, Magistrate Shoemaker denied the presbytery’s claim and upheld the church’s temporary restraining order – which eventually became a preliminary injunction.
On Nov. 5, the congregation voted 162-61 for disaffiliation. Five months later, Bogue informed the presbytery that he had renounced the jurisdiction of the PCUSA.
At their stated meeting May 8, presbytery commissioners voted to give the administrative commission for Hudson Presbyterian Church full powers of the session for the church.
The court case, meanwhile, quieted down for months while each side went through the discovery process of obtaining documents and other evidence to prepare their arguments. Things heated up again April 16, when Hudson Presbyterian Church and Eastminster Presbytery each filed a motion for a summary judgment.
Hudson’s motion for summary judgment
Hudson Presbyterian Church’s motion for a summary judgment seeks a court declaration that the 25-year-old church:
- “Owns its real and personal property in fee simple, subject only to mortgages and liens, if any.”
- “Holds title to its property free and clear of any trust interest asserted by Eastminster Presbytery, the PCUSA or any other entity.”
- Has a “duly elected session” that is “its legal and proper corporate trustees, or directors.”
- “Had the legal right and authority to disaffiliate from the PCUSA, and cannot be compelled to remain therein.”
“The PCUSA does not like the fact that Hudson Presbyterian Church voted to disassociate,” the motion contends. “It seeks to gain control of the property at issue by asking the court to impose a trust interest in the property in favor of the PCUSA. No written express trust exists, and therefore Eastminster seeks to have this court create and impose such a trust upon the congregation … after it has voted to disassociate.”
The motion also argues that “Eastminster contends that the act of the congregation in voting to disaffiliate automatically entitled Eastminster to replace the board of directors of HPC with a board of its own choosing, and declare that its newly appointed ‘true board’ is the ‘true’ title holder to the property.”
The church says its deeds “convey no interest to Eastminster Presbytery or the PCUSA, or its predecessor denomination, the United Presbyterian Church in the United States of America. There are no restrictions, reservations, reversions and/or trusts identified.”
The motion states that the church’s mortgage and other loans and promissory notes contain “acceleration clauses” that say the debts will become immediately due and payable if the church ceases to be connected to the PCUSA. All debts have been satisfied except for a loan of about $11,000, Norman said.
Hudson Presbyterian Church is the sole owner of its bank accounts, endowment fund, annuities and Early Childhood Center, the motion states. Further, the church “has not received any financial support from Eastminster Presbytery, Synod of the Covenant or the PCUSA since 1986” and has given more than $544,000 to the presbytery, synod and denomination since 1983, according to the motion.
The presbytery’s trustees do not have the power to mortgage or sell the church’s property or “to sell the entity known as Hudson Presbyterian Church,” the motion argues.
The trustees also “cannot encumber in any way the property of Hudson Presbyterian Church,” it argues. Eastminster Presbytery’s assertion of a trust interest, the motion states, “is based upon an interpretation of the Book of Order.” But the motion argues that the Ohio Supreme Court established in a 1970 ruling, Serbian Orthodox Church of St. Demetrius of Akron v. Kelemen, that the preferred application for settling a church property ownership case is using neutral principles of state law.
Neither the presbytery nor the PCUSA is referenced in the deeds to the two parcels of property that comprise the Hudson Presbyterian Church land, the motion states. “Neither deed creates a trust nor a beneficial interest in any entity” other than the church and “there is no reverter clause or reserved interest in any third party,” it states.
The church’s articles of incorporation “contain no express or implied trust interests,” the motion contends. “Eastminster’s argument that HPC was not entitled to change its articles of incorporation is directly contrary to the statutory rights given to a nonprofit corporation such as HPC,” it states.
The church contends that its withdrawal from the PCUSA and resistance of Eastminster Presbytery is in accordance with “the authority vested in a nonprofit corporation” under Ohio law. “HPC’s articles of incorporation, under the neutral-principles doctrine, support the actions of HPC regarding its voluntary associations and, most importantly for this case, do not create or imply a trust,” the motion argues.
The Book of Order supports the church’s “position regarding property ownership, voluntary association, voluntary jurisdiction, self-governance and a democratic process of withdrawal from the denomination,” the motion states. It argues that local churches are encouraged to form corporations where permitted by law and that such corporations will have the power, under clause G-7.0402, “to receive, hold, encumber, manage and transfer property, real or personal, for the church; to accept and execute deeds of title to such property; to hold and defend title to such property; to manage any permanent special funds for the furtherance of the purposes of the church, all subject to the authority of the session and under the provisions of the Constitution of the Presbyterian Church (USA).”
“‘The church’ as used here refers to the local church,” the motion contends.
The motion also counters the presbytery’s expected argument that it has the sole authority to determine dismissals. “Such an argument finds no support in the Book of Order, the Articles of Reunion or the presbytery’s Manual of Operations, all of which are entirely silent on the issue,” it contends.
Perhaps most importantly, the motion argues that the PCUSA property trust clause – G-8.0201 in the Book of Order, which states that “All property held by or for a particular church … is held in trust nevertheless for the use and benefit of the Presbyterian Church (USA)” – does not establish a legally recognized trust. The clause is “an assertion by an entity which does not hold title to any of the property at issue,” the motion states.
“The terms are vague and indefinite as to intent, assent, fiduciary obligations or directives and purport to create, in one fell swoop, a trust over all property even tangentially related to the PCUSA,” the motion contends. “At most, G-8.0201 may be said to create some sort of ‘ecclesiastical trust,’ which would necessarily be voluntary in nature (hence revocable), and unenforceable in a court of law.”
The motion also takes to task clause G-8.0301, which states that, “Whenever property of, or held for, a particular church of the Presbyterian Church (USA) ceases to be used by the church as a particular church of the Presbyterian Church (USA) in accordance with this Constitution, such property shall be held, used, applied, transferred or sold by the presbytery.” The motion says that conflicts with clause G-9.0102, which states that “Governing bodies of the church are distinct from