Author: churchlitigationupdate

DISCOVERY SANCTIONS: TAR BABY WARS

Litigating about litigating is the most expensive battle in a lawsuit because it does not directly decide the case on the factual merits. Discovery disputes are the worst because they usually decide the least number of issues between the parties.

In Padron v Watchtower Bible and Tract Society of NY, Slip Op., (CA App., 2017), the trial court imposed a sanction of $4,000 per day for non-compliance with a document discovery order of the court. The appellate opinion affirming the trial court’s order laboriously considered and rejected the denomination’s arguments against production of reports to the denomination by local congregations over many years regarding sexual abuse of children. The Plaintiff asserted the denomination allowed accused officers to transfer from one congregation to another even though the denomination knew of multiple accusations against the transferring officer. The discovery sanction by the trial court came about after the denomination had unsuccessfully challenged the discovery sought by the Plaintiff but openly refused to obey the court’s order. It might also be noted that the trial court appointed a discovery referee (aka “special master”) and it was the referee’s recommendations the trial court adopted in its order. The denomination did not help its argument by making inconsistent arguments in different proceedings about whether it had the documents sought.

Denominations should probably use a single discovery coordinating law firm or law department rather than only the local law firm assisting with defense of the case. Such coordination would reduce the likelihood of internal inconsistency in discovery positions and reduce the cost of the learning curve regarding denominational document flow. Likewise, a single qualified technology vendor can assist the denomination with searches of electronic document storage and reduce the risk of inconsistent results from one case to the next. One issue that the denomination lost was limitation of the document searches to congregations in the state of California, the location of the trial court, the Plaintiff and the relevant congregations. Once a discovery issue hops state boundaries national coordination becomes less expensive than fragmented responses.

A TALE OF TWO VICARS

In a single church building, two factions formed and irrevocably divided the congregation. One faction was led by a presiding vicar appointed by a metropolitan and the other faction was led by another presiding vicar appointed by a different metropolitan. The metropolitans were from two different nations. The two factions shared the church building for several years while their litigation for ownership proceeded. But, one faction tired of awaiting the judicial outcome and locked out the other. The locked out faction sought an injunction to resume sharing the building and it was granted. An appeal followed. The faction that sought to lock out the other claimed they were changing the locks because their metropolitan ordered that sacraments be offered in the building only once per Sunday. The faction that changed the locks claimed that their action was ecclesiastical because they were obeying an ecclesiastical order. The appellate court affirmed the injunction because it was a preliminary and temporary order meant only to preserve the status quo. St. Mary’s Knanaya Church, Inc. v Abraham, Slip Op., Commonwealth Court PA, 2017.

The Court certainly did not accuse anyone of trying to game the system with an “ecclesiastical” order. Nevertheless, it is hard not to wonder if that was the strategy. It would have been a clever ruse but like most “trick plays” it had no lasting impact on the score. Regardless, the amount of money the competing factions are expending on legal fees to protect their respective ownership rights in the building would likely have comfortably relocated one of the factions.

The primary legal lesson from this opinion might be that a preliminary injunction designed only to preserve the status quo will receive greater tolerance even if it tends to intrude into ecclesiastical matters. Also, because this is at its core a dispute over real estate, neutral principles would allow disposition without consideration of ecclesiastical orders delivered solely to resolve the land dispute.

EMPLOYMENT CONTRACT BREACH

In states that have adopted the Neutral Principles Doctrine in non-religious issue church disputes employment contracts with non-clergy are enforceable in court. A church can contractually impair or limit the First Amendment Ecclesiastical Abstention Doctrine and the Ministerial Exception Doctrine. The financial aspect of the contract will typically not be deemed ecclesiastical even if reinstatement as a remedy is not available under these Doctrines. Courts will be reluctant to try to force reinstatement on a religious organization even for non-clergy and prefer a financial remedy. But, the remedy could be technically available.

In Saint Augustine School v Cropper, Slip Op. (KY 2017), the very brief opinion of the state supreme court did not explain why the elementary school “lay administrator” was in fact “lay.” The “lay administrator” was rehired under a written contract but then shortly after that terminated in what the court seemed to describe as a reduction in force required by a financial downturn at the school or the church. The opinion was silent as to any other reason for termination. The lower court granted summary judgment to the church based on the Ecclesiastical Abstention Doctrine. The Ministerial Exception Doctrine was not asserted by the church. Thus, the Kentucky Supreme Court reversed the lower court on neutral principles grounds.

Written employment contracts are two edged swords. Churches should use them as do businesses to reduce their exposures. But, doing it badly or autonomically usually leads to unintended consequences. Most states in the west have adopted the “at will” employment doctrine. It applies when there is no written or implied contract. State law regarding “at will” employment doctrine should be considered in the evaluation of the need for and contents of an employment contract. Written employment contracts should have a limited duration, typically short, and expressly state renewal is not automatic even if employment continues beyond expiration. There are many other considerations.

THE ECCLESIASTICAL ARBITRATION FORUM

It is rare to get any look inside ecclesiastical arbitration forums because, like nearly all arbitration forums, they are private and not public. Some church forums have clearly defined rules of procedure and others are a bit more spontaneous. The arbitrators may or may not have any training in the rules of the forum or arbitration in general. About the only safeguard for the rights of the parties in most church arbitration forums is that arbitrators almost invariably try to do the right thing.

In Garcia v Church of Scientology, Order, (USDC, MD Fla., Tampa Div. 2017), the Plaintiff sought certain safeguards. The Plaintiff wanted a disclosure by the arbitrators that there were no ex parte contacts with the church about the case. The Court held that the Plaintiffs provided no authority indicating the Court had jurisdiction to order such a disclosure. The Plaintiff wanted the hearing transcribed by a court reporter and a ruling from the Court that certain rules of evidence would not apply. The Court also held no authority was submitted indicating the Court had the power to order such attributes. The Plaintiff also argued the church waived the arbitration agreement between the parties but the Court swept it aside in one sentence because the Court held there was no evidence of waiver submitted. The Court also concluded that the Free Exercise Clause blocked the Court from “resolving internal disputes” regarding religious doctrine.

The Order was very brief and not a full opinion thus commentary is necessarily limited. Nevertheless, the arbitration clause was in an agreement the Plaintiff signed when they joined the church according to the Court and may also have been mandated by the controlling denominational documents. The United States Arbitration Act, 9 USC §1, et. seq., apparently could be invoked to enforce the church membership contract containing the arbitration agreement. While reporting that seeming holding, one has to wonder if the Ecclesiastical Abstention Doctrine would allow a court to enforce an arbitration clause. But, an arbitration clause is a creature of contract and neutral principles would probably accommodate enforcement, even if the arbitration was intended to rule upon a religious dispute. While the Court did not describe the procedural rules of the arbitral forum, it remains to be ruled upon whether substantive and procedural due process challenges could be made if the dispute was economic rather than ecclesiastical.