Skip to comments.Legal battles erupt over rights to church real estate
Posted on 04/29/2006 5:26:49 PM PDT by sionnsar
When the Rev. Allen Kannapell and most of St. Andrew's parish in Livonia, Mich., decided earlier this year that they could no longer remain Episcopalians, the conservative pastor knew he had a choice.
Kannapell could either launch an expensive legal fight to claim ownership of St. Andrew's that he would likely lose, or simply walk away. He and his flock weighed the options and decided to turn over their keys.
"To fight over something when you're pretty sure you can't win is a distraction," said Kannapell, now pastor of the Anglican Church of Livonia, where he celebrates the Eucharist under a basketball hoop at a local YMCA. "It wasn't in the best interest of our people."
When it comes to church property, and legal questions of who owns it and can dispose of it, the stakes could hardly be higher. National denominations, local congregations and an army of attorneys charging by the hour are battling over hundreds of millions of dollars in real estate. Columbus might become an arena in the dispute in June when the fractured Episcopal Church holds its national convention here.
The fate of disputed property ultimately might be determined by secular courts. Increasingly, judges who once deferred to bishops are making their own decisions in what all sides call an uncomfortable confrontation between civil and church law.
"It's a state-by-state issue, and very fact-dependent," said Valerie Munson, a Philadelphia attorney who specializes in church property disputes. "It can be very messy and uncertain."
In mainline Protestant churches - especially the Episcopal Church - bishops are battling breakaway parishes that want to secede from denominations and take their property with them.
In the Roman Catholic Church, meanwhile, West Coast bishops already in bankruptcy are trying to protect parishes from being sold to settle sexual abuse lawsuits. On the East Coast, bishops are wrestling with restive parishioners who refuse to accept their directive to sell or close parishes to cope with a shortage of priests.
For almost all independent or congregational churches, ownership is hardly an issue since local congregations own all property. For example, if a Southern Baptist congregation wanted to leave the denomination, there is nothing the denomination could do to retain the property, and it's unlikely it would ever try.
Hierarchical churches, however, are another story:
Facing big-dollar sex-abuse lawsuits, the Catholic bishops of Portland, Ore., and Spokane, Wash., declared bankruptcy. In determining which assets would be available to pay creditors, the bishops said parishes were off-limits because they were not controlled by the diocese.
Under civil law, the bishops said, they were merely trustees for the property, holding them in benefit of parishioners. Under church law, they said, they have authority over parishes but cannot close them at will.
But lawyers representing the creditors in Portland argue that it's clear that the 124 parishes are owned by a corporation that is based in the bishop's office.
Among most major mainline Protestant churches - Methodists, Episcopalians and Presbyterians - local property is held "in trust" for the national denomination. Rules on Lutheran churches tend to be more flexible.
In a 1979 decision, the U.S. Supreme Court signaled it would defer to church bodies to set the rules for deciding property disputes. As a result, most denominations adopted internal laws that say when a parish cuts ties with the national church, it must also forfeit its property.
Some of that, however, might be changing.
In California, the state Supreme Court ruled in 2004 that a Fresno church, St. Luke's United Methodist, could cut ties and keep its property, based on state trust law.
In Los Angeles, Episcopal Bishop Jon Bruno is appealing court decisions that allowed two churches - All Saints in Long Beach and St. David's in North Hollywood - to leave with their property.
And in Virginia, state Sen. Bill Mims last year introduced a bill, eventually defeated, that would allow breakaway churches to secede with their property. Mims is a member of an Episcopal parish that recently left to align itself with an Anglican bishop in Uganda.
In the Episcopal Church, some 28 bishops are already talking about how or whether to fight an expected flood of breakaway churches, and church leaders have earmarked $100,000 in seed money for a property defense fund.
The issue is expected to come to a head this summer at the denomination's General Convention in Columbus. Dissident conservatives have said they might be forced to leave - and take their property - if the national church does not correct its leftward drift.
Liberal Episcopal groups have drawn up contingency plans for seizing breakaway property, while conservatives have spent millions building an alternative denominational structure to receive breakaway parishes.
Last year, one of the nation's largest Episcopal churches, Christ Church in Overland Park, Kan., aligned itself with a bishop in Uganda. The local bishop agreed to sell the building to Christ Church for $2.7 million, and both sides parted ways amicably.
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