Key point 7-03.3. Most courts apply the "neutral principles of law" rule in resolving disputes over the ownership and control of property in "hierarchical" churches. Under this rule, the civil courts apply neutral principles of law, involving no inquiry into church doctrine, in resolving church property disputes. Generally, this means applying neutral legal principles to nondoctrinal language in any one or more of the following documents: (1) deeds to church property; (2) a church's corporate charter; (3) a state law addressing the resolution of church property disputes; (4) church bylaws; or (5) a parent denomination's bylaws.
The Texas Supreme Court ruled that a church that withdrew from the national Episcopal Church retained control of its property in a dispute with the national church. Due to doctrinal differences with the Episcopal Church ("national church"), some members of a local Episcopal church (the "church") proposed disassociating from the national church and organizing as an independent church. The church conducted a called meeting during which the following resolutions were presented: (1) amend the corporate bylaws to, among other changes, remove all references to the national church; (2) withdraw the local congregation's membership in and dissolve its union with the national church; (3) revoke any trusts that may have been imposed on any of its property by the national church. The resolutions passed by a vote of 53 to 30.
After the parish vote, the local diocese of the national church took the position that the church could not unilaterally disassociate from the Diocese and that the vote did not have any effect on the church's relationship with the diocese or national church. The diocese held a meeting with the faction of the church loyal to the national church and appointed a new priest. The loyal faction elected a board (vestry), and the diocese recognized the loyal faction as the legitimate church.