Category: church splits

CHURCH ELECTIONS DISPUTES

Generally, the problem with elections at local churches that result in lawsuits is a failure to have a clear membership roll by which to identify voters or a failure to have a governing document with a clear election procedure.  We have reported on courts that refused to take any action in either event because church governance is routinely held to be outside the jurisdiction of a court.  Other courts believe the Neutral Principles of Law, typically found in state non-profit or general corporation statutes, can resolve an election issue so it remains within their jurisdiction.  In these courts, the process is the question, not the merits of the election or the outcome.

In Chung v Kim, Unpublished Slip Op. (Cal. App. 2022), the trial court set aside the results of the first purported election of church leadership and ordered that a second be held pursuant to the procedures imposed by the Court.  The procedures crafted by the Court were largely taken from the church By Laws.  Implicit in the opinion is that the trial court was working off a translation of the By Laws into English.  In challenging the second election conducted under the trial court’s order, the challengers submitted a second translated set of By Laws.  Exactly how the second translation differed from the first was not reported in the opinion.  In any event, the trial court refused to consider the second translation or overturn the second election.  The appellate court affirmed the trial court.

In courts that will hear disputes about the process by which church leadership is elected in congregational churches, clear By Laws will almost always carry the day if the voters can be identified by a membership roll that appears to be legitimate.  The risk of failure to have both is a battle for control between factions.  The underlying issues that created the two factions will rarely be aired on the merits because nearly all courts will see that as straying into areas shielded by the Ecclesiastical Abstention Doctrine.

GENERIC AND ICONIC RELIGIOUS SYMBOLS

We have reported cases in which the church split led to a tug of war over a symbol that one faction tried to register and prevent other factions from using.  Symbols, both generic and iconic, often were created long ago and their exact origins will never be known sufficiently to support defendable registration as a trademark.  Symbols more recently created can become iconic, especially when they were not registered as trademarks or defended as such during the early years or decades of their existence.  Symbols that become iconic or generic representations of a religious group may lose defendable registration as a trademark.

In Holy Spirit Association v World Peace and Unification Sanctuary, Inc., Memorandum (MD Penn. 2022), the federal trial court was faced with competing claims for a trademarked symbol.  The church split arose at the denominational level between competing factions each claiming to be the legitimate heir of the deceased founder.  The symbol in question may have been created by the founder in 1965 but one faction did not attempt to trademark it until 2009.  The faction claiming the symbol was registered and defendable demanded that one of the other factions cease using the symbol.  The faction using the symbol in alleged violation of the registration claimed the symbol was iconic and represented the underlying theological premise of everyone involved and not a particular faction.  The federal court determined it could not determine whether the symbol was iconic without inquiring into the underlying theological premise the symbol was allegedly supposed to represent.  The federal trial court held such an inquiry would violate the Ecclesiastical Abstention Doctrine and could not be decided by Neutral Principles of Law.  Another religious inquiry, the court determined, would require determination of which faction was or represented the rightful heir of the founder and allegedly entitled to control the registered symbol.

The race to register the symbol as a trademark did determine a winner.  Indeed, the half a century of use of the symbol by the founder of the denomination prior to registration argued that the symbol was or had become iconic long before the actual registration.  The lesson is that trademarking registration should accompany the birth of the symbol or be commenced as soon thereafter as possible.  Founders rarely anticipate their own passing and rarely plan for succession.  Likewise, they rarely plan for competing factions among those claiming to be rightful heirs.

CONGREGATIONAL SOVERIGNTY

In hierarchical and denominational churches, the ability to ascertain what final decisions have been made (or not made) is generally greater than in independent congregational churches.  That is because in independent congregational churches, every document of decisions made, or not made, must come from the local church.  Local churches that are not very good at keeping a record of their congregational votes, membership rolls, or board agendas and minutes, or have no organizational documents, may endure factional strife, hurt feelings in abundance, or even fission.

In McKnight v Wakefield Missionary Baptist Church, Inc., 2022 NCBC 10, Slip Op. (Supp NC 2022), an independent congregational church fell into a factional dispute that spilled out into the street and a North Carolina trial court.  The church was originally organized as an association and had a “constitution” and “bylaws.”  The Plaintiffs were two “trustees” that sued eight other “trustees.”  It all seemed to start at a congregational meeting to decide who should be the signatories to the church bank account(s).  Why this was not being decided by the trustees was not explained, but was probably required by the organizational documents of the association.  The congregation “elected” three signatories.  But, the eight trustees objected to irregularities in the congregational vote and rejected the appointment of the new signatories.  The bank would not allow itself to become the referee, froze the church accounts and filed an interpleader action asking a court to determine who controlled the church accounts.  The eight trustees also fired the pastor, who seemingly sided with the other faction, and locked the building pending release of the church funds in the interpleader action.  One faction conducted off site worship services.  The eight trustees incorporated the church and conducted another congregational vote that ratified all of their actions.  The eight trustees reopened the church building.  The trial court applied the Neutral Principles of Law to determine “who constitutes the governing body of this particular church and who has that governing body determined to be entitled to use the properties.”  The trial held the eight trustees were confirmed in their actions by the congregational vote they conducted after incorporation under the newly adopted Constitution and Bylaws.  The trial court held the eight trustees had a credible membership roll that indicated the voters entitled to vote at the congregational meeting.  The court refused to look behind the congregational vote ratifying the actions of the eight trustees because to do so would intrude on church governance in violation of the Ecclesiastical Abstention Doctrine.  The trial court held no jury had greater authority to inquire into the congregational vote.  The trial court enjoined the Plaintiffs from using the church name in fund raising or a new congregation because the name of the church belonged to the entity and not the membership.  The ratification of incorporation placed the ownership of the church name, previously owned by the association, in the church corporation.

While an appeal might cause the reported rulings to be revised or reversed, the ability of the eight trustees to prove up a valid membership roll, and a ratifying congregational vote by such identified members, was determinative.  Ratification of incorporation and the other actions of the trustees was sufficiently well documented to convince the Court that church governance by the congregation of a congregational church occurred ending the dispute.  The lessons are clear and have been repeated in prior reports.  A well-documented membership roll, annually accepted by the congregation or an authorized governing board is crucial.  Clear governing documents are the next important.  Maintenance of both by meeting minutes, congregational and governing board, completes the proof.

UNINCORPORATED CHURCH ASSOCIATION DISORDER

Unincorporated church associations are governed, in some states, by a “non-profit organization” statute.  Such a statute may impose on the church association certain requirements to disclose financial records to members of the association.  An unincorporated church association can also have a Constitution and Bylaws.  The trap for the unwary is that such Constitution and bylaws, while not identical to those of an incorporated church, will not be effective as governing documents if they lack specificity similar to corporate cousins.

In the case of In Re Lee Edward Thomas, Slip Op. (Tex. Civ. App. 6th 2022), the Constitution and Bylaws of the unincorporated church association did not specify the procedure for termination of the pastor but did specify the procedure for hiring the pastor.  The same documents also described duties of a finance committee but did not disclose the method or procedure for appointment of finance committee members.  When the church split spilled into the street, each faction claimed it represented the congregation.  At stake was control of the church property and several hundred thousand dollars.  The bank holding the money threw up its hands and sought to interplead the money.  The trial court held the issue of the employment, or unemployment, of the pastor was outside the jurisdiction of the court because of the Ecclesiastical Abstention Doctrine.  Because the Constitution and Bylaws did not specify the method of selection of the finance committee members, their appointment was a matter of church governance, claims about which were barred by the Ecclesiastical Abstention Doctrine.  The court could not determine whether the allegedly voting members were in fact members because the church had not maintained an official membership roll.  However, embezzlement, conversion and breach of fiduciary duties claims were retained to the extent they could be decided by Neutral Principles of Law.

Unincorporated church associations have the same needs for governing documents and membership rolls as do incorporated churches.  The governing documents can certainly be inspired by the religious beliefs of members but the practical, secular, and, yes, worldly aspects should be drafted by a lawyer consistent with state statutory requirements.  Governing boards of unincorporated church associations should keep minutes just like incorporated churches and for the same reasons, such as documenting adoption of an annually updated membership roll and amendment of governing documents.  Without such, the unincorporated church association will fall into disorder which will be laid bare in an internal dispute.