Church’s Failure to Follow Bylaws Nullifies Actions

Court deems selection of a pastor, board member resignations, and special meeting null and void.

Key point 6-02.2.
Churches are subject to the provisions of their governing documents, which generally include a charter and a constitution or bylaws (in some cases both). A charter is the state-approved articles of incorporation of an incorporated church. Most rules of internal church administration are contained in a constitution or bylaws. Specific and temporary matters often are addressed in resolutions. If a conflict develops among these documents, the order of priority generally is as follows—charter, constitution, bylaws, and resolutions.

Key point 6-06.4. Church officers and directors can be removed from office in the manner authorized by the church’s governing documents. It is common for church bylaws to give the membership the authority to remove officers and directors who engage in specified misconduct or change their doctrinal position.

Key point 6-12.1. Church membership meetings must be conducted in accordance with the procedural requirements ordinarily specified in the church’s governing documents. The most common requirements pertain to notice, quorum, and voting.

The Idaho Supreme Court ruled that a church’s failure to follow its bylaws in the selection of a pastor, the resignation of two board members, and the conduct of a specially called business meeting, rendered these actions null and void.

Selection of a pastor

A dispute arose in a church over the appointment of a pastor and the resignation of two board members. The church’s bylaws addressed the selection of a pastor as follows:

Section 4. Vacancy: In the event of a vacancy in the senior pastorate, a pastor shall be selected in the following manner:

The board of directors shall immediately convene and assign one of the associate pastors as a temporary replacement for the senior pastor. A roster of candidates shall be presented to the board of directors for review of their scriptural qualifications. Upon acceptance of qualification, each candidate will present themselves to the voting membership. After the voting membership has had an opportunity to review all candidates set forth by the board of directors, a special meeting will be called and a vote will be taken, with a majority vote required for the final appointment of the new senior pastor.

The court noted that there was no evidence that the pastor was ever voted on by the membership. Rather, the only evidence was that he had been asked when meeting with the church board if he would be interested in serving as pastor, and he replied that he was. The court concluded that “this was not sufficient evidence for a finding that he was properly appointed as the senior pastor.” Because there was no evidence that the bylaws were complied with, the pastor’s appointment was not valid.

The court stressed that the bylaws of a corporation are “equivalent to contracts among the members” and are binding on its members, and therefore “actions taken in violation of a corporation’s bylaws are void.”

Resignation of board members

Another issue before the court was whether two of the church’s three board members had effectively resigned their positions. The only evidence that one of these board members had resigned was his statements to the other board members, and some church members, that he “no longer wanted to be on the board.”

The court quoted the following provision in the state nonprofit corporation law: “A director may resign at any time by delivering written notice to the board of directors, its chairman, or the corporation.” I.C. § 30-3-69(1).

The court explained: “Although a director may resign at any time, the exclusive method for doing so is by delivering written notice… .” The court noted that neither of the two board members who allegedly resigned “ever submitted a written resignation. Accordingly, there is no evidence to support the … [conclusion that they had resigned.]”

The court then addressed the argument that these two board members had effectively resigned by absenting themselves from the board:

We note that absence from board meetings is only grounds for removal of a director when specifically provided for in the corporate documents. Here, there is no such provision in the bylaws or articles. The bylaws do, however, allow for removal of a director “by a unanimous vote of the remaining board members” regardless of whether the director has been absent from board meetings. However, there is no evidence in the record that such a vote took place.

Furthermore, the court found that no board meetings took place for the previous four months and so “there were no board meetings to be absent from.”

In conclusion, “because there was no evidence in the record to support a finding that [the two board members] ever tendered a written resignation or absented themselves from the board,” they did not cease to be members of the board.

Special meeting

Following the alleged “resignation” of two of the board’s three members, the remaining member called a special meeting of the church membership at which two new members were selected. The validity of this special meeting was contested on the ground that the meeting could not be called by one board member.

The court quoted the state nonprofit corporation law regarding the calling of special membership meetings:

(1) A corporation with members shall hold a special meeting of members: (a) On call of its board or the person or persons authorized to do so by the articles or bylaws; or (b) Except as provided in the articles or bylaws of a religious corporation if the holders of at least ten percent (10%) of the voting power of any corporation sign, date and deliver to any corporate officer one (1) or more written demands for the meeting describing the purpose or purposes for which it is to be held. I.C. § 30-3-47.

The church’s bylaws address special meetings as follows: “Special meetings of the voting membership may be called by or at the request of two-thirds (2/3) of the voting membership… . Notice of the annual, regular, or and (sic) special meeting of the voting membership shall be given by oral notice at three consecutive Sunday services. The business to be transacted at the meeting need not be specified in the notice, unless specifically required by law or these bylaws.”

In this case, the court noted, “no membership roster was kept… . Thus, calling the special meeting at the request of two-thirds of the voting membership was not possible. Consequently, the only method available to call the special meeting was on call of [the church’s] board as provided under” state law (quoted above). And, while the church’s bylaws were silent as to what constitutes an act of the board, the nonprofit corporation law specifies that “an act of the board occurs when a quorum is present and the majority of directors vote in favor of such act.” Since two of the church’s three board members had not resigned, a “majority of directors” consisted of two or three of the board’s three members. Therefore, the special meeting of the church membership could not be lawfully called by one board member. The court concluded: “Here … the meeting was not called by the majority of directors in office and therefore was improperly called [and consequently] any action taken at the special meeting, including the election of new directors, was void.”

What this means for churches

This case raises the following important points.

First, a church’s governing documents must be followed in the selection of pastors. The court concluded that the church’s failure to follow its bylaws in the selection of its senior pastor rendered his selection invalid. While not all courts would agree with this conclusion, it is not without precedent, and at a minimum should encourage church leaders to be sure that all pastoral selections comply with the church’s governing documents.

Second, and perhaps most importantly, the court ruled that board members do not cease to be members of the board by informing others that they no longer want to serve in that capacity. Rather, board members remain on the board until they cease to be members pursuant to the terms of the church’s governing documents, or the provisions of the nonprofit corporation law under which the church is incorporated. But nonprofit corporation law generally applies to issues of church administration only with respect to matters not addressed in the church’s governing documents, as was the case here. The court concluded that the procedure for a board member’s resignation described in the state nonprofit corporation law had not been followed, and so the two members who allegedly had resigned had not done so and remained on the board.

Knowing with certainty when a board member ceases to be a member of the board is of utmost importance, since board members generally cease to be liable for the actions of the board after they have resigned. If there is doubt or ambiguity regarding a board member’s status, this means that such a person may be exposed to continuing liability for board decisions over which he or she exercised no control. As a result, church leaders should review their governing documents to see if the procedure for resignation is clearly specified so there is no ambiguity regarding the timing of a board member’s resignation. The same goes for the end of a term of office. If a church’s governing documents are clear, then nonprofit corporation law will not be invoked.

Third, the court concluded that actions taken at a special business meeting that was not called according to the procedure described in a church’s governing documents are null and void. The court concluded: “Here … the meeting was not called by the majority of directors in office and therefore was improperly called [and consequently] any action taken at the special meeting, including the election of new directors, was void.” Again, the failure of church leaders to ensure that the church’s governing documents are followed in the notice and conduct of a membership meeting can lead to the invalidation of actions taken. Kemmer v. Newman, 387 P.3d 131 (Ida. 2017).

Alleged Victims’ Denial of Sexual Molestation

Court convicts man despite alleged victim’s repudiation of allegation.

Church Law and Tax 1994-03-01 Recent Developments

Sexual Misconduct by Clergy and Church Workers

Key point: The fact that a minor who accuses an adult of child abuse later retracts her story does not necessarily prove the accused’s innocence.

An Idaho appeals court upheld the criminal conviction of an adult for child molestation even though the alleged victim denied that the molestation ever occurred! A 13-year-old girl was visibly upset at school one day. Three classmates attempted to comfort her and asked her why she was crying. She eventually informed them that her mother’s boss had molested her. A few days later, with the girl’s permission, another classmate informed the school secretary that a “friend” had been sexually molested. The secretary persuaded her to reveal the victim’s name. Later that day the secretary spoke with the victim in the presence of the classmate, and the victim told her that her mother’s boss had molested her. School personnel later contacted law enforcement authorities. The victim was placed in a foster home and her mother’s boss was arrested. A few weeks later, however, the alleged victim informed her mother and school officials that she had never been molested and that she had “made up” the story out of anger she felt toward her natural father. The alleged offender was prosecuted for child molestation. The alleged victim testified at the trial that she had fabricated the accusation, and that she had only intended to be “sarcastic” when she accused her mother’s boss of molesting her. However, the three classmates with whom she shared this information testified that she was not being sarcastic on that occasion and that she was “crying really hard.” A pediatrician who had examined the alleged victim testified that the girl had been molested on at least one occasion. However, another physician testified that he had examined the girl and found no evidence of molestation. A psychologist testified that the girl did not exhibit any symptoms commonly associated with molestation. The alleged offender himself testified and insisted upon his innocence. The jury found the accused guilty of molestation, and sentenced him to10 years in a state penitentiary. The accused appealed his conviction to a state appeals court, which affirmed the jury’s ruling. The appeals court concluded that there was sufficient evidence to sustain the jury’s verdict.

This case demonstrates that an accused child molester may be guilty of molestation even though the alleged offender denies the charge and the alleged victim repudiates her earlier allegation that the abuse occurred. Church leaders should attach considerable weight to a minor’s initial allegation of abuse, particularly when there are corroborating factors present (such as disclosure to friends, and emotional distress). Keep in mind that there may be compelling reasons why a minor would later change his or her previous allegation of abuse. These include threats of harm to the minor, threats of a break-up of the victim’s and the offender’s families, and the prospect of a lengthy prison sentence for the offender as a result of the minor’s testimony. Church leaders also should be aware that they may have reasonable cause to suspect that abuse has occurred (triggering a duty to report child abuse to a state agency) even though the alleged offender denies the charge and the alleged victim repudiates his or her earlier allegation that the abuse occurred. In most states, mandatory child abuse reporters have a duty to report abuse so long as they have reasonable cause to believe that it occurred. This is a much lower standard than the criminal standard of “beyond a reasonable doubt” that was needed to find the accused guilty in this case. State v. Vaughn, 861 P.2d 1241 (Idaho App. 1993).

See Also: Failure to Report Child Abuse

Property Tax Exemption for Parsonages

The definition of a “parsonage” is limited in some states.

Key point: Some states exempt parsonages from property taxes, but the definition of a "parsonage" is limited in some states to homes owned by churches and occupied by clergy who serve a local church.

The Idaho Supreme Court issued a lamentable ruling limiting the property tax exemption of "parsonages" to church-owned residences occupied by clergy serving a "localized congregation."

Idaho law exempts parsonages from property taxes. For many years, a home owned by the Mormon church and occupied by the president of the Idaho mission was considered to be exempt from property taxes as a parsonage. The president is an ordained minister who devotes his full time to overseeing the spiritual and physical needs of 157 lay missionaries in his jurisdiction. The president conducts weekly religious services for the missionaries, and visits each one at least monthly.

The president's home is used not only as a residence for the president, but also as a short-term residence for missionaries who are just beginning or ending their assignments. A county tax assessor's office determined in 1987 that the president's home did not qualify for exemption as a parsonage. A trial court later ruled that the home was exempt, and the case was appealed to the state supreme court.

The supreme court agreed with the tax assessor that the home was not exempt. The court quoted the definitions of the term "parsonage" in several dictionaries, concluding that "it is evident that all of the dictionaries refer to a residence occupied by the incumbent minister having ecclesiastical domain over a contained body of parishioners or church members, formally referred to as a congregation …. It is not clear that the legislature intended to extend the word 'parsonage' … to include any property housing any minister."

The court concluded: "We hold that a parsonage is not merely a residence owned by a religious organization in which an ordained member of that organization resides. The definition of 'parsonage' as employed by [state law] is a building owned by a religious organization occupied as a residence by a designated minister who ministers to a specific localized congregation that gathers to worship at frequent and regular intervals."

The court pointed to rulings in several other states that reached a similar conclusion (Maryland, Massachusetts, Michigan, New Jersey, Tennessee, Washington, Wisconsin), and to a statute in another state (Illinois) that specifically broadens the property tax exemption of parsonages to include housing occupied by clergy whether or not they serve a specific local congregation. In defending its conclusion, the court noted, "the localized congregation requirement is based on sound policy that, since the … tax burden of exempted property will be shifted onto the people of the county, those people should receive something in return—a place to worship in the community and a minister to conduct the services."

It was a dissenting Justice who reached the correct conclusion: "I would [recognize] that both 'parson' and 'parsonage' are archaic terms from an earlier era" and that the term parsonage "is nothing more than a clergyman's house." Corporation of Presiding Bishop v. Ada County, 849 P.2d 83 (Idaho 1993). See also Ada County v. Roman Catholic Diocese, 849 P.2d 98 (Idaho 1993).

Confidential and Privileged Communications

Church Law and Tax 1989-09-01 Recent Developments Confidential and Privileged Communications Richard R. Hammar, J.D.,

Church Law and Tax 1989-09-01 Recent Developments

Confidential and Privileged Communications

The Supreme Court of Idaho emphasized that the clergy-penitent privilege will not apply to any conversation that is not confidential. During the trial of a suspected rapist, the prosecution called a clergyman to the witness stand to testify regarding comments made to him by the accused three days before the rape. The clergyman testified that immediately following a Sunday morning worship service three days before the rape, the accused had approached him and stated that he “was really hurting and that he couldn’t live without [the rape victim]”—who was his former wife. The clergyman testified that this conversation had occurred while “many people were hanging around as they usually do” following a service, and that “we [the clergyman and the accused] talked with quite a number of people.” The accused claimed that the prosecution erred in allowing the statements made by the accused to the clergyman to be introduced in court, since such statements were the product of the “clergy-penitent” privilege. The court rejected this claim, noting that only confidential communications made to a minister acting in his or her professional capacity as a spiritual advisor are privileged from disclosure in a court of law, and that the statements made by the accused in this case were not privileged. It concluded that “the record supports the trial court’s finding that the conversation had not taken place in private and therefore was not a privileged confidential communication.” This case illustrates the significant principle that statements made to clergy are not privileged unless they are made in confidence. This ordinarily means that the statements are not made in the presence of a third party, and that they are made with the expectation that they will remain secret. Obviously, statements made to a minister immediately following a morning worship service will not be “privileged” if they are made in the presence (and within the hearing distance) of other persons. They simply are not confidential. The result is that neither the minister nor the person making the statement can refuse to testify regarding the conversation in a court of law or during a deposition on the basis of the “clergy-penitent” privilege. State v. Hedger, 768 P.2d 1331 (Ida. 1989).

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