THE DEAD HAND OF THE PAST

Courts will typically refrain from resolving church leadership succession controversies.  A court might make certain the process dictated by the church governing documents is followed such that usurpation is not likely to succeed, especially when in dispute are positions in congregational churches.  In hierarchical church organizations, the courts seem less likely to resolve a dispute because church government is presumptively able to manage its own internal process for elections.

In our post on April 4, 2017, we reported the opinion in Puri v Khalsa, 844 F3d 1152 (9th Cir. 2017) in which the Oregon federal court dismissed the case on the pleadings and on appeal the United States Court of Appeals for the 9th Circuit reversed an Oregon federal district court decision.  On remand, in Puri v Khalsa, Opinion and Order, (D. Or. Portland Div. 2018), discovery proceedings were followed by motions for summary judgment.  Also, a state court four-week jury trial had been concluded on state law theories of recovery.  In the case on remand, the Oregon federal court had all the evidence the parties could muster in discovery and the prior trial, too.  The issue was whether the succession plan of the founding religious leader was enforceable or whether the boards of the denomination could revise or revoke the succession plan.  The founding religious leader died and left written instructions with the lawyer of the corporation regarding the identities of the persons the late religious leader was appointing to the controlling boards.  The Oregon federal court held that the boards could revise the succession plan.  Also, the Oregon federal court concluded the evidence proved that while they may not be conventional churches the defendants were religious organizations.  Also, the court held the board members, because of their authority to choose and remove religious leaders in the church, were governed by the Ministerial Exemption Doctrine.  Finally, finding the entities to be religious organizations brought their internal decision-making into the Ecclesiastical Abstention Doctrine.  Thus, the Oregon federal court dismissed the case.

Succession plans that involve binding beyond the grave are likely to fail.  A founder that wants to preserve a legacy should do so before retirement or death.  Governing documents that invest denominational boards with the authority to select clergy or other church leaders may likewise place the election of board members beyond the reach of a secular court.  Internal processes that select these board members should be carefully designed to avoid over reaching and usurpation because secular court rescue may not be available.  As the foregoing demonstrates, the founder’s legacy was costly to preserve or inherit, and may not, in fact, belong to the founder or the founder’s heirs.

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