Generally, the “parsonage” is an obsolete tool of compensation because most ministers with families came to understand in the 20th century that home ownership was the largest and best investment working people could make. Parsonages were useful to some churches with high ministerial turnover and as an in-kind compensation tool. Nevertheless, some churches still use parsonages for a variety of good reasons.
In West Michigan Annual Conference of the United Methodist Church v City of Grand Rapids, Slip Op. (Mich. App. 2021), the city was so desperate for revenue it decided to deny parsonage status, and therefor exemption from ad valorem taxes, to the parsonage inhabited by the District Superintendent over 91 churches. The assessed value was under $100,000. The city argued the District Superintendent was an ordained minister but did not supervise a particular church making the parsonage ineligible. The Court of Appeals affirmed the appeals board of the city in holding that the statute did not require that the minister be “over a particular church” and contained no such qualifying language.
Churches faced with a rogue local government attempting to impose taxation without justification or legal basis should not challenge the taxation without counsel. A lawyer with a little experience with the local government in question can save a church a lot of money and consternation. It is very rare that such questions arise and are litigated to this extent. But, sometimes, even stupid lawsuits take on a life of their own and are impervious to common sense.
In the first published decision of 2021 that meets our criteria for reporting, we are confronted with some familiar facts and some new ones. As the history of the last two decades has made clear, retaliation against whistleblowers by church leadership is often a path to escalating accusations and finally legal consequences possibly out of proportion to the fault of the church.
In Rehfield v Diocese of Joliet, Slip Op. (ILL., 2021), the Plaintiff was a church school principal. A parent allegedly sent threatening emails to a teacher that resulted in a report to the pastor and eventually law enforcement. The conduct was admonished but allegedly the parent escalated the communications that led to an arrest warrant. The principal was allegedly instructed by the church not to alert other parents about the conduct of the errant parent. However, when the photo of the parent was circulated to alert faculty and staff persons unknown leaked it to news media. The news media report induced other parents to be upset they were not likewise notified. The church terminated the employment of the principal but continued to pay her pursuant to her written employment contracts. The opinion did not indicate a reason for termination from the record before the Court. The plaintiff sued alleging a retaliatory discharge and violation of the Illinois Whistleblower Act. The trial court dismissed the case, the intermediate appellate court affirmed and the Supreme Court of Illinois affirmed. The retaliatory discharge claim was dismissed because the claim was only available to “at will” employees and not contract employees like Plaintiff. The Whistleblower Act case was dismissed because the claim was held barred by the Ministerial Exception of the Ecclesiastical Abstention Doctrine arising from the First Amendment. The Illinois Supreme Court relied on Hosanna-Tabor Evangelical Lutheran Church & School v. Equal Employment Opportunity Comm’n, 565 U.S. 171 (2012) and Our Lady of Guadalupe School v. Morrissey-Berru, 591 U.S. ___, 140 S. Ct. 2049 (2020), both reported herein, regarding the analysis of the issue of whether the principal was a ministerial employee. The Illinois Supreme Court held the principal was a ministerial employee because the evidentiary record below was uncontradicted.
Because the church reportedly paid out the employment contract of the principal, which may have resulted in full pay for a school year beyond the termination, the monetary damages claim would have been somewhat muted if the claim had been allowed to proceed. In any event, the more important issue is that whistleblower claims by employees classified as ministerial by the evidence in the case are likely barred. Certainly, because history has shown that schoolteachers may be held to be ministers, school principals seem more likely to be. As history has also shown, churches that strike down whistleblowers may face societal condemnation.
The law of defamation during church disciplinary actions is complicated by the multiplicity of approaches taken in each state and because such cases are rare. Indeed, the cases are so rare that changes in societal mores and norms, not to mention law, have probably changed dramatically between the incidence of such cases.
In Laguerre v Maurice, 2020 NY Slip Op 07877 (NY App. 2020), the defendant pastor allegedly told the 300-member congregation during a “membership” meeting that the Plaintiff, an Elder in the congregation, was a homosexual who viewed gay pornography on the church’s computers. The Plaintiff sued claiming the statement by the pastor was defamatory per se. The defendant pastor alleged the statement, if made, was part of an ecclesiastical disciplinary process over which the court had no jurisdiction. Further, the defendant pastor alleged the statement, if made, was made to the membership and was protected by a common interest privilege. The Court held there was no ecclesiastical issue because neutral principles of law would suffice. The Court held the Plaintiff’s allegation the pastor’s statements to the membership were made with malice made any common interest privilege inapplicable. The malice alleged was that the statements were only made to remove Plaintiff as an Elder and force him out of church membership and not to vindicate a moral or religious position. Thus, the case was not outright dismissed. However, the Court affirmed dismissal of the theory of recovery for defamation per se, overruling a prior 1984 decision of the Court along the way, by holding allegations of homosexuality were no longer defamatory per se. The Court held state public policy no longer considered allegations of homosexuality defamatory per se.
Unless denominational or church governance documents require statements about the basis of church disciplinary actions to the membership, rather than just the church leadership, such statements should be avoided for obvious reasons. Churches that deem homosexuality as immoral must still exist in a society that no longer permits discrimination against homosexuals. That does not require abandonment of morality, but it does require intelligent co-existence. See, 1 Timothy 5:19-20. Most churches have moved well past the era in which divorced persons were ostracized and so, too, might that happen regarding other mores.
Does the pastor, minister, evangelist, priest, rabbi or imam have the authority to enter into an employment contract that will bind future church leaders? However, in order to answer such a question judicially may require that a secular court develop a full understanding of the ecclesiastical structure of a denomination or church.
In Napolitano v St. Joseph Catholic Church, Slip Op. (FL. App. 2020), the plaintiff was for twelve years employed as the office manager of the church. When the pastor learned that he was to be replaced by the hierarchy of the denomination, a written employment contract was for the first time entered into between the church and Plaintiff. The contract had a term of four years and required termination only for cause. It also automatically renewed for another term if there was no written notice of intent to terminate six months before the end of the term. The new pastor terminated the Plaintiff without notice. The Plaintiff allege breach of contract and that the former pastor had apparent authority to enter into the employment agreement and bind the denomination. The case was dismissed by the trial court and the appellate court affirmed dismissal. The appellate court held that the actual authority of the former pastor to enter into the employment agreement and bind the denomination was a question of ecclesiastical doctrine into which the court could not intrude. The court held that the question of apparent authority was likewise an ecclesiastical inquiry.
Denominations should consider including in their governance documents clauses that preclude or require the prior written approval of written employment agreements. Several different approaches could be taken. These might include requiring written approval only if the written employment agreement has a tenure greater than one or two years, or if it permits termination only for cause, or require an automatic termination clause in the event a new minister is appointed or licensed by the denomination for the church. Local churches without denominational affiliation or oversight should in their governance documents spell out whether a single church leader can enter into an employment agreement without approval of a governing board.