A South Carolina court ruled that an agreement entered into by two church board members to pay a monthly stipend to the widow of a deceased pastor was unenforceable because the board members lacked the authority to enter into such an agreement. Jenkins v. Refuge Temple Church of God, 818 S.E.2d 13 (S.C. App. 2018). This feature article will review this ruling and more broadly address the key legal issues associated with signatures and signature authority. It is important for church leaders to be familiar with this information to avoid both the unenforceability of contracts and the potential personal liability for those who sign contractual agreements on behalf of a church.
Key point 4-06. Clergy who sign legal documents in their own name with no indication that they are signing in a representative capacity on behalf of their church may be personally liable on the document.
Key point 6-06.2.Officers and directors must be legally authorized to act on behalf of their church. Legal authority can be expressed, implied, inherent, or apparent. In addition, a church can ratify the unauthorized actions of its officers or directors, but this is not required.