Calif. Anglican church
wants its day in court
By John H. Adams, The Layman, January 27, 2009
St. James Anglican Church in Newport Beach, Calif., has filed a “petition for rehearing or modification of decision” to challenge a Jan. 5 California Supreme Court opinion that the national Episcopal Church (USA) is the owner of the local church property.
The petition includes evidence that was not weighed by the Supreme Court that disputes the Episcopal Church (USA) claimed ownership of St. James property.
Furthermore, the petition, again in California Supreme Court, says the ruling was preemptive because it did not allow St. James to present its case to the court: “ … [N]o affirmative defenses have been raised; no discovery has taken place; no full factual record has been developed; no cross-claims (if any) have been brought; and no trial has occurred.”
The premature judgment deprives the petitioners “of their day and court” and violates “their due process rights. … This case is simply not ripe for any ruling adverse to Petitioners other than vacating the Superior Court’s judgment and remanding for further proceedings under the legal framework announced in the Opinion.”
The petition included a copy of a letter in 1991 from the Diocese of Los Angeles to St. James. The letter was signed by the Rev. Canon D. Bruce MacPherson, canon to the ordinary and attorney for the bishop of Los Angeles.
That letter said: “The Rector, Wardens and Vestry of Saint James’ Parish, Inc., of Newport Beach, are given permission by the Bishop of Los Angeles, the Rt. Rev. Frederick H. Borsch, to purchase and own the property on 32nd Street in Newport Beach, in the name of the Rector, Wardens and Vestry of St. James Parish, Inc. and not held in trust for the Diocese of Los Angeles or the Corporation Sole.”
The petition cited other evidence supporting St. James’ claim.
“In reliance on that waiver, St. James Church raised and expended hundreds of thousands of dollars to purchase and improve its property,” the petitioners said. “Further, in the late 1990s, St. James Church conducted a capital campaign in which it raised several million dollars for the improvement of its property from members. Many, if not most, of the individual donors to that campaign expressly restricted their gifts to benefit only the local church and not the Episcopal Diocese or denomination.”
The petitioners argued that their potential defenses and facts remain to be litigated. Thus, it was preemptive when the court stated in January, “When it disaffiliated from the general church, the local church did not have the right to take its property.”
Even under neutral principles of law, the standard the California Supreme Court said it used in its property decision, “the legal rule is not that a general church automatically owns a local church’s property just because it says so,” the petitioners said.
While the California Supreme Court’s ruling in January was unanimous, one of the court’s most highly respected members argued that it did not apply neutral standards of law – and, had it done so, it would have required a decision favoring the congregation.
“Applying the neutral principles of law approach, we conclude that the general church, not the local church, owns the property in question,” the court said. “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.”
Justice Joyce L. Kennard did not agree. “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.”
She added, “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.”
The neutral principles of law approach treats church property ownership in the same way that it would treat nonchurch property ownership. It places its emphasis on deeds, articles of incorporation, bylaws and other corporate documents, and some constitutional documents.
Hierarchical deference, an approach that has been supported by both the Presbyterian Church (USA) and the Episcopal Church (USA), holds that in a property dispute between a local church and a hierarchical denomination, the court should favor the claims of the denomination.
Forrest Norman, an attorney in Columbus, Ohio, and a member of the Board of Directors of the Presbyterian Lay Committee, said the case should be remanded to trial court. “The case will have questionable precedential value in California and elsewhere if the California Supreme Court declines to address the procedural deficiencies brought about by the overreaching opinion,” he said.
“Generally, appellate level courts are constrained by the case before them, and the opinion is constrained to the legal posture presented to the court, and the courts’ decisions are limited by that posture,” said Norman, who has represented a number of congregations in church property disputes.
“Here, the California Supreme Court’s opinion should have no binding precedential value on the substantive language of denominational trust clauses, as that was not the case before it,” he added. “The appropriate thing to do would be to remand the case for further determination by the trial court, which can consider the majority of the ruling as dicta and proceed to apply neutral principles doctrine as advocated by the majority, but applied in a truly neutral manner.”