California court finds ‘no express trust’ regarding property in favor of PCUSA
By Parker T. Williamson, The Layman Online, September 16, 2005
In a ruling dated Sept. 1, a Superior Court judge in Los Angeles has ruled against a pivotal argument made by the Presbyterian Church (USA) in its claim to property held by Serone Church, Inc., a Korean congregation that declared itself no longer a part of the denomination.
“Cross-Complainants [Hanmi Presbytery and the PCUSA] do allege that its Book of Order grants it a trust in Serone Church’s property, but this is inadequate. Subdivision (c) (2) of Corporations Code section 1 & 2 does not authorize a general church to create a trust interest for itself in property owned by a local church simply by issuing a rule declaring that such a trust exists.”
Judge Theresa Ann Bigelow
Attorneys for Hanmi Presbytery and the PCUSA argued that when Chapter 8 (the “trust clause”) was added to the denomination’s Book of Order in the 1980s, “an express trust was created in favor of the PCUSA.” Serone contested that contention, showing that there is nothing in the congregation’s Articles of Incorporation that agrees to place the Serone Church’s property in such a trust.
“Cross-Complainants [Hanmi Presbytery and the PCUSA] state no facts showing that Serone Church’s Articles of Incorporation show membership in the PCUSA, or that its real property is held in trust in favor of PCUSA,” said Judge Theresa Ann Bigelow, “Cross-Complainants do allege that its Book of Order grants it a trust in Serone Church’s property, but this is inadequate. Subdivision (c) (2) of Corporations Code section 1 & 2 does not authorize a general church to create a trust interest for itself in property owned by a local church simply by issuing a rule declaring that such a trust exists.”
Serone Church’s attorney, Paul Rolf Jensen, has, successfully argued at this stage of the case that merely the fact that the denomination’s General Assembly and presbyteries adopted a constitutional amendment declaring that all local church property is to be held in trust for the denomination does not, in itself, bind the local church’s property. If the property is to be placed in trust, said Jensen, it must be done by the local church that owns the property. Serone Church did not do so.
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on property issues Jensen says he has heard that some Presbyterian churches may have amended their Articles of Incorporation in the 1980s, believing that the Book of Order amendment required them to do so. But, he says, at least in California, there is no reason why they cannot reconvene the congregation and revoke the trust, so long as their earlier action did not explicitly declare the trust irrevocable.
In the Serone Church case, denominational attorneys were unsuccessful in their demand that the congregation turn over all of its financial records to the denomination. “Cross-Complainants state no facts establishing a fiduciary relationship or other circumstances appropriate to the remedy of an accounting,” said the judge in her five-part ruling.
The denomination was also denied its “Quit Title” claim; namely, that the court issue title to the Serone Church property to the presbytery of Hanmi and the PCUSA. The court said: “Cross-Complainants state no facts establishing that Cross-Defendants’ claim in Serone Church’s property is without right and that Cross-Defendants have no estate, title, or interest whatever in the property.”
In their attempt to claim the Serone Church property, denominational attorneys not only filed lawsuits against the church, but individual lawsuits against the pastor and each member of the session. That action forced the pastor and elders to retain attorneys at their personal expense, in addition to retaining Jensen, who represents their church.
Bigelow has set the case for trial on January 17, 2006.