Author: churchlitigationupdate

FIRST RULE OF CHURCH SPLITS: DO NOT PANIC THE BANK

When church splits spill into the street one of the things that can happen is that the bank that serviced the church checking and other accounts may not know who should be authorized to transact business in the accounts.  The bank will likely freeze all accounts and seek protection from a court.  If the bank is sufficiently antagonized, it will interplead.  That means the accounts will be liquidated and the funds deposited in the registry of the court.  The court will then decide who can transact business and for what purposes.  Generally, any expense the church incurred in happier times, including payroll, may be paid with court permission.  Dealing with interpled funds is time consuming, expensive and slow.

In United Community Bank v Wakefield Missionary Baptist Church, 2021 NCCOA 89 (NC App., 2021), an audit revealed “deficiencies in bookkeeping and payroll records.”  The pastor sought to add a signatory to the church accounts.  The pastor also allegedly learned the prior signatories opened but did not disclose a Certificate of Deposit containing $123,000.  The prior signatories objected to the additional signatory promoted by the pastor.  The bank decided to seek court protection from the dispute and interpled the funds.  The prior signatories appealed arguing the court could not direct how the church spent its money or determine the membership status of the prior signatories or the newly proposed signatory.  The trial court held it could employ Neutral Principles of Law to determine who could control the church accounts.  The appellate court held the interpleader order of the trial court was interlocutory, and therefore not appealable, and that the trial court had jurisdiction to determine who had the right to control the church accounts.

Most factional church disputes cause the bank to lock down church accounts while one faction or another continues to manage church finances through control of the offerings deposited in accounts at another bank.  But, if the first bank is pushed in the least an interpleader will follow.  As the semi-sentient computer learned in the movie War Games (1983), the only winning move is not to play.

ALIENATION OF AFFECTION CLAIMS

As a genre, alienation of affection claims, called “criminal conversation” in some jurisdictions are all but archaic reminders of an earlier age.  “Clergy malpractice” claims sometimes were merely alienation of affection claims or “criminal conversation” claims in a different wrapper.  The few states that still allow alienation of affection claims or “criminal conversation” claims require that the claimant prove the marriage was a good one before the interloper intervened.  Most claimants could not make such proof by the 20th century.  In the 19th century, these types of tort claims were considered necessary to protect women because women were considered vulnerable dependents.

In Mosby v Kleinguetl, Slip Op. (Tex. Civ. App. 14th, 2021), the Plaintiff alleged that “counseling sessions” “devolved into a ‘personal relationship’ that culminated in … divorce.”  The Plaintiff alleged this was part of a pattern of conduct.  The trial court twice permitted the Plaintiff to amend the Petition to allege jurisdictional facts but dismissed the case.  In other words, the Plaintiff could not allege facts supporting a claim that a good marriage was destroyed by incompetent or intentional conduct that was actionable.  The appellate court did not hold, and probably deferred such a holding to the Supreme Court of Texas, that there no longer are justiciable tort claims for alienation of affection or “criminal conversation” in Texas.  However, it reached the same result.

It probably does not require pronouncement in this report that a sexual relationship between counselor and counseled is not a good idea.  A “personal relationship” seems all but unavoidable in counseling relationships that extend over a period of time but counseling professionals know to avoid escalation and so too should church counselors.  Common sense would demand such restraint.  Nevertheless, these relationships may no longer be in the purview of tort law.

PARACHURCH ORGANIZATION RELIGIOUS LIBERTY BATTLES

Churches and their immediate offspring for the most part won their freedom from government control of their employment relationships.  Our Lady of Guadalupe School v Morrissey-Berru, ___ US ___, 140 S. Ct. 2049, 207 L. Ed. 2d 870 (2020) laid to rest the “confusion” that certain courts seemed to have about the scope of the Ministerial Exception.  Basically, faculty at church schools will rarely be considered outside of the scope of the Ministerial Exception.  However, religious non-profit organizations are now the targets of those that believe that religious beliefs must be abandoned as a lesser civil right deserving of less protection.

In Woods v Seattle’s Union Gospel Mission, Slip Op. (Wash. En Banc, 2021), the parachurch organization focused on the needs of the homeless.  As part of that outreach, the organization offered “legal aid” services.  Plaintiff signed a statement of faith as a law school intern and then later sought employment when a staff attorney position opened.  However, Plaintiff alleged he was not hired because he disclosed he was in a same sex relationship.  The State of Washington’s employment discrimination statute exempted religious nonprofit organizations from the definition of “employer.”  However, the clarity of the statutory language, though it was not held unconstitutional on its face, was not enough to decide whether the statute applied to the Plaintiff.  The appellate court reversed and remanded the case for a determination whether the Ministerial Exception applied to the position of “legal aid” lawyer in a religious nonprofit providing services to the homeless.

Parachurch organizations may have to withdraw from “secular” service provision and abolish those employment relationships, at least in some states, to avoid being forced to accommodate employee actions that are contrary to a morals clause or other similar government or court imposed employment policy.  Until religious beliefs are respected as constitutionally protected on an equal level with other constitutional rights, there will be jurists that will demand second-class status for religious believers.  The alternative would be for parachurch organizations to place at risk their donor base and their religious beliefs or messages to comply.

THERE IS NO MIDDLE

The United States Supreme Court decision in Our Lady of Guadalupe Sch. v. Morrissey-Berru, 140 S. Ct. 2049 (2020) (Our Lady of Guadalupe), left open the possibility that a Christian parachurch organization might have employment relationships that are not subject to the Ecclesiastical Abstention Doctrine or the Ministerial Exception.  A determination that such employment relationships exist in a parachurch organization brings, as to that particular employee, the applicability of state and possibly federal employment laws.

In DeWeese-Boyd v Gordon College, Slip Op. (Mass. 2021), the non-denominational Christian fine arts college failed to promote the Plaintiff to the academic rank of full Professor.  The Plaintiff sued and alleged gender discrimination and retaliation for “vocal opposition to Gordon’s policies and practices regarding individuals who identify as lesbian, gay, bisexual, transgender, or queer (or questioning), and others (LGBTQ+ persons)…”  The appellate Court affirmed the trial court’s decision that the Defendant was a religious institution even though it was not part of a denomination.  But, the Court struggled with “the most difficult issue for us is how to evaluate her responsibility to integrate her Christian faith into her teaching and scholarship as a professor of social work.”  The Court held that the “duty to integrate her teaching and Christian faith” imposed on her by her employer did not make her sufficiently ministerial to trigger the Ministerial Exception and held that she could pursue a state law claim for discrimination and retaliation.  The Court was silent on how the trial court might determine whether the “integration” duty and the employer’s evaluation of Plaintiff’s compliance was subject to the Ecclesiastical Abstention Doctrine.

Because the Plaintiff’s claim was about a promotion, which might have been denied for any number of reasons and only the development of a trial record might make identification of the actual reasons definite, resolution might be determined by economics rather than any sort of righteous indignation.  After all, Plaintiff was not fired so Ecclesiastical doctrine or beliefs might or might not have weighed much.  Donors might not have been influenced either way.  But, being neither beast nor foul, being as much secular as religious, might mean that in reality the Defendant was not sufficiently ecclesiastical to make its faculty ministerial.  Fully ecclesiastical parachurch organizations typically do not seek accommodation with secular beliefs unless those secular beliefs are no long secular or no longer verboten.