False Accusations

Court rules that a priest cannot sue men who accused him of sexually molesting them.

Church Law & Tax Report

False Accusations

Court rules that a priest cannot sue men who accused him of sexually molesting them.

Key point 4-02.03. A number of defenses are available to one accused of defamation. These include truth, statements made in the course of judicial proceedings, consent, and self-defense. In addition, statements made to church members about a matter of common interest to members are protected by a “qualified privilege,” meaning that they cannot be defamatory unless they are made with malice. In this context, malice means that the person making the statements knew that they were false or made them with a reckless disregard as to their truth or falsity. This privilege will not apply if the statements are made to nonmembers.

An Illinois court ruled that a priest could not sue two adult males who accused him of sexually molesting them when they were minors. Two adult males provided a Catholic archdiocese with written statements recounting how they were sexually molested by the same priest when they were minors. One of the victims alleged that the priest would often have him sleep with him in the same bed at the church rectory, and take him on golf outings and other trips (where they stayed in the same room). The victim also stated that he accompanied the priest to a health club, where the priest insisted that he walk around the locker room naked. The second victim alleged that when he was in the third or fourth grade he spent the night at the church rectory and shared a bed with the priest, who repeatedly fondled him throughout the night. As a result of these complaints the archdiocese initiated an investigation, and a hearing, that resulted in the priest’s removal from the ministry.

The priest responded to these developments by suing the two complainants for defamation and emotional distress. He claimed that plans were announced in various church bulletins that a celebration would be held to commemorate his twenty-fifth anniversary as a priest, and that the complainants decided to retaliate against him by “concocting a false and defamatory story” that he had sexually abused them some 20 years earlier. The priest claimed that as a result of these false statements he sustained injury to his reputation. He sought compensatory damages in excess of $1 million and an undetermined amount of punitive damages.

A state appeals court ruled that the First Amendment guaranty of religious freedom prohibited it from resolving the priest’s lawsuit: “Since the only defamatory publication allegedly made by the [two victims] was made to the church itself within internal disciplinary proceedings, the absolute First Amendment protection for statements made by church members in an internal church disciplinary proceeding precludes the court from exercising jurisdiction in this matter.”

Application. The court concluded that there is an “absolute First Amendment protection for statements made by church members in an internal church disciplinary proceeding,” meaning that complaints of ministerial misconduct made to church officials for investigation ordinarily will not expose the complainants to civil liability for defamation or emotional distress. However, the court cautioned that there is no absolute privilege to make accusations of ministerial misconduct to persons outside of the church disciplinary process, and as a result such accusations may expose the complainants to civil liability. Stepek v. Doe, 910 N.E.2d 655 (Ill. App. 2009).

This Recent Development first appeared in Church Law & Tax Report, March/April 2010.

Taxation—Church Property

An Illinois court ruled that a storm drainage service charge based upon the amount of a property owner’s run-off surface was a fee, not a tax.

Key point. Special assessments and users fees assessed by local governments against landowners may be applied to churches without violating a state law exempting church-owned property from property taxation.

An Illinois court ruled that a storm drainage service charge based upon the amount of a property owner's run-off surface was a fee, not a tax, that could be assessed against churches without violating a state law exempting churches from property taxation.

A city enacted an ordinance establishing a "storm water utility fund" to provide for the "management, protection, control, regulation, use and enhancement of the storm water systems" owned by the city. The ordinance imposed a "storm water service charge" on all "developed property" in the city, including church-owned property. Several churches, each of which owns developed property within the city, sued the city to prevent the assessment of the storm water service charge against them.

The annual service charge was based on the number of "impervious area units" on a tract of property (2,800 square feet of impervious area was one unit). The ordinance defined impervious area or impervious surface to mean "those areas that prevent or impede the infiltration of storm water into the soil" including rooftops, sidewalks, walkways, patios, driveways, parking lots, storage areas, compacted aggregate and awnings."

The churches argued that the service charge amounted to a form of "property tax" that could not be assessed against churches that were exempt from property taxation. A trial court ruled that the service fee was a "user fee" rather than a tax, and so it could be legally assessed against churches. The churches appealed on the following grounds: (1) under Illinois law, the definition of a tax upon real property clearly encompasses the service fee charged by the city, and (2) several other states have found similar ordinances to be a tax and not a user fee.

Definition of property tax

On appeal, the churches argued that the term "property tax" under state law was sufficiently broad to cover service charges. The state property tax statute defines a tax as "any tax, special assessment or costs, interest or penalty imposed upon property." Property is defined as "the land itself, with all things contained therein, and also all buildings, structures and improvements and other permanent fixtures thereon."

The court disagreed. It noted that a tax "is a charge having no relation to the service rendered and is assessed to provide general revenue rather than compensation." A user fee, on the other hand, "is proportional to a benefit or service rendered."

The court concluded that the storm water service charge was clearly a user fee since there was a "direct and proportional relationship between imperviousness and storm water run-off, thus creating a rational relationship between the amount of the fee and the contribution of a parcel to the use of the storm water system."

Precedent in other states

The court reviewed several similar cases in other states and concluded that "the more recent case law favors the position that storm water service charges are a fee."

Application. Every state exempts church property from taxation, with some variation from state to state. However, as this case illustrates, the fact that a church is exempt from property taxation does not necessarily insulate it from special assessments or users fees. Church of Peace v. City of Rock Island, 2005 WL 1140427 (Ill. App. 2005).

Recent Developments in Illinois Regarding the Taxation of Church Property

An Illinois court ruled that a church’s parking lots, a storage building, and a former sanctuary that had been badly damaged in a fire, were all exempt from property taxation.

Church Law and Tax1999-11-01

Taxation-Church Property

Key point. The exemption of church property from property taxation extends to auxiliary buildings and parking lots that facilitate the accomplishment of the church’s exempt purposes.

An Illinois court ruled that a church’s parking lots, a storage building, and a former sanctuary that had been badly damaged in a fire, were all exempt from property taxation. In 1992, a church sought a religious-use property tax exemption for various parcels of real estate in Chicago. A state agency denied the application, and the church requested a formal hearing to determine whether the parcels warranted exemption. At the hearing, the church requested exemption for the following properties: (1) a burned church building; (2) a private school located directly east of the burned church; (3) a large storage building; and (4) various parking lots. The burned church building had been damaged by a fire a few years earlier. The fire resulted in the relocation of worship services and other church activities to the school building. A judge determined that the school was exempt, as were the parking lots associated with it. However, the judge concluded that the burned church was not exempt even though the congregation intended to rebuild it when they received the proceeds from an insurance policy, since its condition prevented it from being used for religious purposes. Further, the storage building was “in a dilapidated condition that rendered it unsuitable for regular use” and therefore was not exempt. The judge also noted that the church had failed to show how the storage facility furthered its exempt purpose and concluded that the storage building was not reasonably necessary to further the church’s exempt operations.

A state appeals court agreed that the school and associated parking lot were exempt, but it also ruled that the burned church building, the storage building, and the parking lots associated with these two buildings also were entitled to exemption. The court noted that Illinois law exempts from property taxation (1) “all property used exclusively for religious purposes, or used exclusively for school and religious purposes … and not leased or otherwise used with a view to profit” and (2) “parking areas, not leased or used for profit, when used as a part of a use for which an exemption is provided hereinbefore and owned by any … school or religious or charitable institution which meets the qualifications for exemption.”

The burned church building

The court noted that the church had the burden of proving that it owned the building and that the building was used exclusively for religious purposes and not leased or used with a view to profit. Since there was no question that the church owned the building, and did not lease it, the only remaining issue was whether the building was used exclusively for religious purposes. The court concluded that it was. It noted that “to the extent that the burned church was used, it was used exclusively for a religious purpose.” It referred to the testimony of a church leader who testified that “sometimes we would go there to pray.” This satisfied the court that the building was used exclusively for religious purposes. It concluded: “[W]here a property already is devoted to a religious purpose as the site of a place of worship, and has been so devoted for numerous years, an incidental interruption of its actual use for that religious purpose due to fire will not destroy the exemption. We conclude that to hold otherwise would be unreasonable and improper.” The court also noted that the church had established a building fund dedicated to rebuilding the burned church and was actively pursuing a legal remedy to obtain insurance proceeds following the fire.

Parking lots associated with the burned church

The trial judge had denied exemption to all of the church’s parking lots other than those associated directly with the school in which religious services were being conducted. The appeals court reversed this ruling, noting that the legislature

did not make the exemption of parking areas contingent upon location or proximity to exempt property. The plain language of the [law] requires that an applicant seeking an exemption for its parking area demonstrate three things: (1) ownership of the parking area by an exempt institution; (2) the fact that the parking area is not leased or used for profit; and (3) the fact that it is used as part of a use for which an exemption is provided ….

The court noted that the church had established its not-for-profit tax exempt status, its ownership of the parking areas, and the fact that the lots were not leased or used for profit. The only remaining question was whether the parking lots were used as part of a use for which an exemption is provided. The court concluded that they were. Once again, it relied on the testimony of a church leader who stated that the church used all of its parking facilities “not all of the time, but most of the time,” and that church buses remained parked there when not in use. This testimony convinced the court that all the church’s parking lots were used as part of an exempt use.

The storage building

The court noted that property will be exempt from taxation if it is “primarily used for purposes which are reasonably necessary for the accomplishment and fulfillment of the [purposes], or efficient administration, of the particular institution.” The court concluded that the storage building met this test: “[T]hough access to the building was limited, the building was used for storage, with certain persons going in and out to store and to retrieve items. Specifically, [the church] demonstrated that it used the storage building … for the purpose of storing desks, chairs, and air conditioners…. [S]o used, the storage building facilitated the congregation’s efforts to keep its church services, activities, and community outreach programs ongoing after the fire. Therefore, we conclude that … [the church] established that the storage building was primarily used for purposes reasonably necessary for the accomplishment and fulfillment of the congregation’s aims of worship and religious instruction, or the efficient administration of [the church].”

Application. This case will be a useful precedent to any church that is confronted by an aggressive tax assessor who wants to place church storage buildings or parking lots on the tax rolls. Mount Calvary Baptist Church, Inc. v. Zehnder, 706 N.E.2d 1008 (Ill. App. 1998). [State Taxes]

Recent Developments in Illinois Regarding Clergy Removal

An Illinois court ruled that the first amendment did not prevent it from resolving a dispute over the removal of an officer by a religious organization since it could do so without any inquiry into religious doctrine.

Church Law and Tax1998-05-01

Clergy Removal

Key point. It is the prevailing view that the civil courts are prohibited by the first amendment guaranty of religious freedom from resolving lawsuits brought by dismissed clergy challenging their dismissals, particularly if the resolution of such a dispute would require consideration of ecclesiastical matters.

Key point. A small minority of courts are willing to review claims of wrongful dismissal by ministers if no inquiry into religious doctrine is required.

An Illinois court ruled that the first amendment did not prevent it from resolving a dispute over the removal of an officer by a religious organization since it could do so without any inquiry into religious doctrine. A small number of members of a mosque convened a meeting at which the president was removed allegedly because “he was no longer living according to Islamic religious tenets.” The ousted president challenged the legal validity of this meeting in court, claiming that it was not called or conducted in accordance with the mosque’s bylaws, or with state nonprofit corporation law. The members who called the meeting insisted that a civil court had no jurisdiction over internal religious disputes involving the removal of officers. A trial court agreed, and dismissed the lawsuit. The former president appealed, and a state appeals court ruled that the case should not have been dismissed. The appeals court began its opinion by observing that the civil courts may not resolve internal church disputes involving “questions of religious doctrine, faith, or polity.” However, under the so—called “neutral principles of law” approach, the civil courts may “objectively examine pertinent church charters, constitutions and bylaws, deeds, state statutes, and other evidence to resolve the matter the same as it would a secular dispute.” The court then applied this principle to the present dispute:

In [this case] the court was not required to examine religious doctrine or practice to determine whether [the ousted president] had been properly removed as president and chairman of the board of directors of the corporation. The corporation’s bylaws and the statute under which it was organized clearly set forth the procedure for appointment and removal of directors, the notice requirements for directors’ meetings, and other attendant corporate matters. These instruments constituted the rules which the members of the mosque chose to be bound by before the dispute arose. The allegations in [the former president’s lawsuit] required the court to decide only whether those procedures had been complied with, and not whether the [former president] was living as a good Muslim. Thus, the trial court was not required to … rule on an ecclesiastical question ….

Accordingly, we hold that the trial court should have utilized the “neutral principles of law” analysis in ruling on [the former president’s lawsuit], requiring only the application of objective legal principles to the corporation’s governing documents and the interpretation of the Illinois Not for Profit Corporation Act, without reference or reliance upon Islamic religious doctrine. This analysis would have enabled the court to resolve the secular question of whether [the members] had complied with the procedural requirements for removal of the [president].

Application. This case illustrates that some courts are willing to resolve disputes involving the removal of clergy, so long as they can do so without any inquiry into religious doctrine or practice. However, this is a minority view. Most courts have ruled that they are barred by the first amendment from getting involved in deciding “who will preach from the pulpit,” whether or not such disputes can be resolved without inquiring into religious doctrine. People ex rel. Muhammad v. Muhammad—Rahmah, 682 N.E.2d 336 (Ill. App. 1997). [ Termination]

Recent Developments in Illinois Regarding Child Abuse

The Illinois Supreme Court ruled that a church counselor could be criminally prosecuted for child molestation despite the fact that the prosecution was based in part on a pastor’s unauthorized disclosure of the incident to civil authorities.

Church Law and Tax1998-05-01

Child abuse

Key point. Churches may reduce their risk of liability by responding to allegations of child abuse on church premises in a way that is viewed as appropriate and reasonable by the victim and the victim’s family.

The Illinois Supreme Court ruled that a church counselor could be criminally prosecuted for child molestation despite the fact that the prosecution was based in part on a pastor’s unauthorized disclosure of the incident to civil authorities. The court rejected the counselor’s argument that the abuse would never have come to the attention of the prosecutor had it not been for the pastor’s unauthorized disclosure. The court noted that the victim’s parents were so dissatisfied with the church’s response to the incident that they would have reported it to the civil authorities even if the pastor had not. The case contains some important lessons for all church leaders.

Facts

Two minor girls arrived at their church one evening for a youth activity. They came early to help prepare for the event. An adult counselor to the youth group was already present when the two girls arrived. One of the girls (the “victim”) was sexually assaulted by the counselor when he asked her to accompany him to the church basement to look for some sound equipment. Later that evening the victim reported the incident to the church’s assistant pastor. The counselor insisted that the incident was a superficial incident of fondling that lasted for only ten seconds, and had been initiated by the victim. A jury did not buy this account, and found the counselor guilty of aggravated criminal sexual abuse.

The counselor appealed his conviction, arguing that the entire prosecution should have been dismissed because it was based in part on an improper disclosure of confidential information. Following disclosure of the incident the counselor’s pastor referred him to the pastor of another church for counseling. The other pastor was also a licensed psychologist. After speaking with the counselor, the pastor was not sure whether he was required by the state child abuse reporting law to report the incident to state authorities. He called a state agency for advice, and was told that as a clergyman he was not required to submit a report but that as a psychologist he was. The Illinois statute requires psychologists, but not members of the clergy, to report instances of abuse. The pastor later submitted a report that identified the victim but did not name the offender. This report was relayed to the sheriff’s office, and ultimately on to the prosecutor.

At the counselor’s trial the court ruled that the pastor with whom he had met could not be compelled to testify to their conversations and that the pastor’s child abuse report could not be introduced into evidence. It based this ruling on the clergy—penitent privilege. But the court rejected the counselor’s argument that the entire prosecution had to be dismissed because it was based on the pastor’s improper disclosure of information he had learned in confidence during the counseling session.

On appeal, the counselor insisted that the trial court erred by not dismissing the entire prosecution. He asserted that his conversations with the pastor were protected by the clergy—penitent privilege and that the state child abuse reporting law did not require the pastor to submit a report to the state. The counselor claimed that the prosecutor would never have learned of the molestation had it not been for the improper disclosure made by the pastor.

The court’s decision

The court began its opinion by noting that “information regarding the [counselor’s] involvement in the present offenses was not secret” even if it was assumed that his conversations with the pastor were privileged and that the pastor was not required to file a report with the state. The court also pointed out that the pastor’s report did not identify the counselor by name, and that it was not until further investigation that the prosecutor learned of the counselor’s identity.

The counselor insisted that the victim and her family were willing to resolve the matter “within the church,” and would have done so had the pastor not reported the incident to the authorities. The court disagreed. It observed:

[the victim’s] father, who was a deacon in the church, acknowledged that he, as well as the others involved in this case, sought initially to resolve this problem internally, without the involvement of civil authorities. [He] also said, however, that in his own mind he kept open the possibility that criminal charges could be brought. [He] explained further that he met with … the pastor and assistant pastor of the church … several days after the incidents charged here. [He] told the two clergymen that he was very concerned about the matter, that he did not believe that the [counselor] should be associated with the youth group, and that the [the counselor], who was a church trustee, should relinquish his set of keys to the church.

[The victim’s father] testified further that he next discussed the matter with [the two ministers] several weeks later … [He] was angry that more had not been done about the situation, and he continued to insist that the [counselor] should surrender his keys to the building and adopt a lower profile in church activities.

The victim impact statement submitted by the [victim’s] parents … also shows the family’s growing sense of displeasure with their church’s response to the accusations against the [counselor]. In a joint statement, the [victim’s] mother and father said that although they had initially believed that the matter could be resolved within the confines of their church, they later became dissatisfied with what the parents believed were insufficient measures taken by the church leaders in response to the [counselor’s] misconduct. The statement explained, “It was our INITIAL intent that this matter be handled by the church, but in our opinion, it was not handled, it was ignored!” The parents expressed their surprise at what they perceived to be the church’s reluctance to make any response to the charges, and noted that the [counselor] was allowed to participate in the church youth group even after [the victim] had reported the incident to [her pastor].

In short, there was no doubt that the counselor’s misconduct would have come to the attention of civil authorities even if the counseling pastor had not reported the incident to the state. The court concluded that the counselor’s interests were adequately protected by the trial court’s exclusion of the counseling pastor’s testimony on the basis of the clergy—penitent privilege.

Application. This case is important for a couple of reasons. First, it demonstrates that persons who are charged with child abuse cannot defend themselves by arguing that the abuse would never have “come to light” had it not been disclosed to civil authorities by a pastor who learned of the abuse in the course of a conversation protected by the clergy—penitent privilege. The pastor may be prohibited from testifying in a criminal prosecution, but this does not prevent the state from prosecuting the abuser on the basis of other evidence that would have been uncovered even if the pastor had not reported the incident.

Second, and perhaps even more importantly, this case demonstrates the risks that church leaders assume in not responding to allegations of child molestation in a way that will be viewed as “adequate” by the victim and his or her family. It is clear that the victim and her parents were content to let this incident be resolved internally by the church. However, this desire evaporated because of the parents’ conviction that the church had not responded adequately to their concerns. This conviction was based on the following factors: (1) the counselor was not required to return his keys to the church building, and (2) the counselor was allowed to continue participating in the church youth group even after the victim had reported the incident of molestation to her pastor. This is an important lesson for all church leaders. In many cases victims of sexual misconduct in the church (and their families) are willing to resolve the matter within the church-so long as they are convinced that the church is taking the matter seriously and is responding appropriately. In this case, the victim’s family were not satisfied with the response of their church in allowing an accused child molester to remain involved in youth activities and to have keys (and unrestricted access) to the church building. People v. Burnidge, 687 N.E.2d 813 (Ill. 1997). [The Clergy-Penitent Privilege , Failure to Report Child Abuse]

Recent Developments in Illinois Regarding Confidential and Privileged Communications

The Illinois Supreme Court ruled that statements made by a murder suspect to his brother were not protected from disclosure in court by the clergy-penitent privilege since the brother was not a recognized minister.

Church Law and Tax1998-03-01

Confidential and Privileged Communications

Key point. In order for statements to be protected by the “clergy—penitent” privilege, they must be made to a minister acting in the course of professional duties. Statements made to a person who is not minister will not be protected by the privilege-even if he or she is acting as a spiritual adviser.

* The Illinois Supreme Court ruled that statements made by a murder suspect to his brother were not protected from disclosure in court by the clergy—penitent privilege since the brother was not a recognized minister. A murderer (the defendant) shot and killed two persons. The defendant was convicted of capital murder and was sentenced to death. He appealed his conviction on the basis of his brother’s testimony, which he claimed should never have been allowed because it was protected by the clergy—penitent privilege. The brother testified that three days following the killings, he paid an unplanned visit to the defendant’s home. He “grabbed him” and asked if he had been “involved” in the crime. According to the brother, the defendant answered “yes.” When asked why he did it, the defendant responded that one of the victims was a drug dealer who owed him money. The defendant claimed that his conversation with his brother was protected by the clergy—penitent privilege, and should never have been disclosed in court. The state supreme court disagreed. It quoted the Illinois clergy—penitent privilege:

A clergyman or practitioner in any religious denomination accredited by the religious body to which he or she belongs, shall not be compelled to disclose in any court, or to any administrative board or agency, or to any public officer, a confession or admission made to him or her in his or her professional character or as a spiritual advisor in the course of the discipline enjoined by the rules or practices of such religious body or by the religion which he or she professes, nor be compelled to divulge any information which has been obtained by him or her in such professional character of as such spiritual advisor.

The court acknowledged that the brother became a minister of the “Church of the Second Coming” while serving in the United States Army in Germany. However, the court noted that “there was no ordination procedure in this nondenominational church” and that “one became a minister by receiving one’s call from God and by being confirmed by the pastor.” When the brother returned to the United States, he became a police officer and began attending a Baptist church because there were no “Church of the Second Coming” congregation.

The defendant frequently turned to his brother for spiritual advice. When asked whether his conversation with the defendant about the killings was “spiritual advice,” the brother responded that “most of it was about his relationship with God. That was my main concern was him getting right with God.”

The supreme court accepted the trial court’s conclusion that the conversation between the defendant and his brother was not privileged, and therefore it was not improper for it to be disclosed to the jury. It based this decision on two grounds. First, the brother “grabbed” the defendant when questioning him about the killings. As a result, it was not possible to say that the defendant’s statements were made to his brother in his professional capacity as a spiritual advisor. Second, the brother had testified before a grand jury concerning the defendant’s statements without any reference to the fact that he was a minister or that he was acting as a minister during the conversation.

Application. This case illustrates that not every statement made to a spiritual advisor will be protected from disclosure in court by the clergy—penitent privilege. In most states, the statement must be made to a minister acting in a professional capacity as a spiritual advisor. In this case, the court conceded that the brother could be viewed as a minister. But it ruled that the defendant was not confiding in his brother as a spiritual advisor. This conclusion was based on the circumstances of the conversation (the brother “grabbed” the defendant when questioning him), and the fact that the brother testified before a grand jury without asserting the privilege. People v. McNeal, 677 N.E.2d 841 (Ill. 1997). [ The Clergy-Penitent Privilege ]

Recent Developments in Illinois Regarding Personal Injuries on Church Property or During Church Activities

An Illinois court ruled that a church could be liable for injuries sustained by participants in a “treasure hunt.”

Church Law and Tax1998-01-01

Personal Injuries-on Church Property or During Church Activities”

Key point. Churches may be liable on the basis of negligence for injuries occurring during “treasurer” or “scavenger” hunts.

An Illinois court ruled that a church could be liable for injuries sustained by participants in a “treasure hunt.” Many churches conduct “treasure” or “scavenger” hunts. Often these are done by youth groups, but not always. Church leaders should review this case carefully before permitting such events. The church in question conducted a treasure hunt, and two church members were injured when the car in which they were traveling struck another vehicle while traveling at an excessive rate of speed. The church was sued on the basis of negligence in organizing and supervising the event. Specifically, the lawsuit alleged that the church organized the treasure hunt, and that participants were encouraged to operate their motor vehicles in a careless and reckless manner while participating in the treasure hunt because the winning team was selected solely on the basis of the fastest time. The state appeals court agreed that the church should have foreseen the risk of injury, and that it had “set a process in motion which could reasonably be expected to cause drivers of the cars in the treasure hunt to speed.”

Application. In recent years a national pizza chain dropped its commitment to deliver pizzas within a specified amount of time. Why did it do so? Because of lawsuits claiming that the pizza chain was responsible for injuries caused by drivers who had to drive recklessly to meet the delivery guaranty. The same principle applies to church—sponsored treasure or scavenger hunts. Churches that organize such events, and select the winning person or team on the basis of speed, are exposing themselves to liability for injuries caused by the reckless driving of participants. How can this risk be reduced? The lawsuit in this case suggested the following steps: (1) select winners on the basis of criteria other than speed; (2) provide participants with information on the routes to be used, including a description of traffic hazards; and (3) emphasize compliance with traffic laws. Indlecoffer v. Village of Wadsworth, 671 N.E.2d 1127 (Ill. App. 1996). [ Negligence as a Basis for Liability, Negligent Supervision as a Basis for Liability]

Prior Acts of Sexual Misconduct

Evidence of prior “bad acts” is generally not admissible in court.

Church Law and Tax 1997-11-01

Sexual misconduct-by clergy and church workers

Key point. The fact that a person accused of child molestation engaged in sexual misconduct in the past may not be relevant in establishing the person’s guilt, unless the prior acts were substantially similar to the current allegations.

An Illinois court ruled that evidence regarding a priest’s prior acts of sexual misconduct were not relevant and therefore were not admissible in proving that the priest molested a young boy. A minor (the “victim”) sued a priest and a Roman Catholic Diocese on account of the priest’s alleged molestation of the victim while the victim was an elementary school student at a parochial school. The victim claimed that the priest molested him sexually and physically in the principal’s office during recess periods. A jury ruled in favor of the priest and diocese. The trial judge refused to allow the victim to present the following evidence to the jury: (1) an adult female claimed that the priest had made sexual advances toward her in the past; (2) another minor claimed that the priest had sexually assaulted him in parochial school bathrooms on three occasions; and (3) the priest allegedly molested a young girl 40 years earlier. The victim appealed the case on the ground that the trial judge had erred in refusing to allow this evidence to be presented to the jury. According to the victim, this evidence tended to prove his accusations against the priest.

A state appeals court disagreed. The court pointed out that evidence of prior “bad acts” is generally not admissible to prove that a person committed a particular offense-unless the prior bad acts “show a method of behavior that is so distinct that separate wrongful acts are recognized to be the handiwork of the same person.” This test was not met in this case. The court noted that the adult female’s claim of inappropriate sexual conduct by the priest did not share “distinct, common features” with the victim’s accusations, and that “the common features are not sufficient to indicate the handiwork of the same person.” Similarly, the court noted that the allegations by the other minor “differ from [the victim’s] allegations in several respects.” In particular, the court pointed out that the victim alleged that he had been both sexually and physically molested by the priest in a principal’s office at school during recess periods, while the other minor claimed that the same priest had only sexually assaulted him, and the acts occurred in school bathrooms. Finally, the court noted that evidence of the priest’s alleged molestation of a female student some 40 years earlier was not admissible because the incident differed in significant ways from the present case. The court noted that the earlier case involved a female who was much older than the victim at the time of the alleged acts, and no physical abuse had occurred.

Application. As a general rule, a church cannot be legally responsible for an employee’s acts of child molestation unless the employee is found guilty of the offense. Often, alleged victims attempt to demonstrate the guilt of the accused by introducing evidence of prior “bad acts.” This case demonstrates that victims may not be able to “prove their case” through evidence of prior bad acts unless those prior acts closely resemble the current allegations. This court went so far as to dismiss evidence of two other alleged incidents of child molestation by the same priest-on the ground that they were substantially different from the facts of the present case. This case will be a useful precedent to churches and denominational agencies that are sued as a result of the sexual misconduct of an employee or volunteer. Doe v. Lutz, 668 N.E.2d 564 (Ill. App. 1996). [Seduction of Counselees and Church Members, Negligence as a Basis for Liability, Denominational Liability]

School’s Liability for a Student’s Suicide

Officials who hear of a student’s suicide threat may be liable for the minor’s later suicide.

Church Law and Tax 1997-07-01

Personal Injuries-on Church Property or During Church Activities

Key Point. School or church officials who receive a report of a minors suicide threat may or may not be liable for the minors later suicide, depending on how they respond to this information.

• An Illinois court ruled that a school was not legally responsible for the suicide of a student, despite the fact that it was aware of a suicide threat made by the student. The facts of this case are tragic, but instructive. A high school student told other students that he was going to kill himself. He also wrote a suicide note. Several students reported the victims intentions to a school counselor. The counselor questioned the victim, but took no action other than to call the victims mother and suggest that she take her son to a hospital for drug overdose treatment. The counselor did not inform the mother of the victims suicide threats. The mother picked her son up from school, and while driving him to a hospital he jumped from the car and later leapt off a highway overpass, killing himself. The mother later sued the school, claiming that it was responsible for her sons death by failing to exercise reasonable care for his safety. She insisted that the school should have called an ambulance or other medical personnel, informed her of his threat to commit suicide, and implemented a suicide prevention program. A state appeals court rejected the mothers lawsuit. The court concluded that teachers and school officials who serve in loco parentis (in the place of the parents) are immune from liability under Illinois law for their ordinary negligence. They may be legally responsible only for their willful and wanton misconduct. The court ruled that the acts of the school or its counselor did not satisfy this standard:

The suicide of a teenage is tragic. School counselors and other school personnel should take every suicide threat seriously and take every precaution to protect the child. If [the counselor] had failed to take any action upon learning of [the victims] statements, her inaction could constitute willful and wanton conduct. However, the [lawsuit] admits that [the counselor] contacted [the mother] and advised her to take [her son] to the hospital, albeit for a drug overdose. While the nondisclosure of [the victims] suicide threats, if proven, could well constitute negligence, the [mother] has failed to allege sufficient facts that would support a finding that either [the counselor] or any other school official acted with [willful or wanton misconduct].

Application. This case addresses a difficult question-the potential legal liability of school officials for the suicide of a student. The court reached a number of conclusions that will be useful to church leaders, whether or not they operate a private school: (1) In many states, teachers are considered to be in loco parentis , meaning that they serve temporarily in the place of a students parents. This ordinarily means that they cannot be legally responsible for injuries to a student unless they engage in willful and wanton misconduct. Obviously, this is a difficult standard to prove. Persons who serve as teachers in church schools may benefit from this rule. Other church workers may as well, to the extent that they satisfy their states definition of in loco parentis. (2) Church or school staff members who do not serve in loco parentis may be responsible for a childs death or injury on the basis of ordinary negligence-a much easier standard to prove. (3) The court concluded that “doing nothing” in response to a suicide threat constitutes willful and wanton misconduct which exposes teachers to liability. The court noted that the counselor took sufficient steps in response to the victims suicide threat to avoid liability based on willful and wanton misconduct. However, the court noted that the counselors failure to advise the victims mother of the suicide threat was negligent. While this was not sufficient to impose liability on the counselor, it would have been enough to impose liability on a person not meeting the definition of in loco parentis. Grant v. Board of Trustees, 676 N.E.2d 705 (Ill. App. 1997). [Legal Liability for Student Injuries]

Related Topics:

Property Leased by For-Profits to Religious Groups May Not Be Tax Exempt

Case illustrates important need to address who pays property taxes in a rental agreement.

Victory Church v. Illinois Department of Revenue, 637 N.E.2d 463 (Ill. App. 1 Dist. 1994)

Key point: Property tax exemptions generally are strictly construed, and all doubts resolved against exempt status.

Key point: Property that is leased by a church from a for-profit business is not entitled to exemption from property taxation in some states even if it is used exclusively for religious purposes.

An Illinois court ruled that a building owned by a for-profit business and leased to a church for exclusively religious purposes was not entitled to an exemption from property tax under Illinois law.

A church leased a 2-story building and three vacant lots from a for-profit company. The building was used for church purposes and the vacant lots were used for parking. A state appeals court ruled that the properties were not exempt from tax. The court began its opinion by noting that it had to decide "whether property leased to a religious organization by a private, for-profit party and used for religious and school purposes is exempt from real estate taxes" under state law.

An Illinois statute exempts from property tax "all property used exclusively for religious purposes, or used exclusively for school and religious purposes … and not leased or otherwise used with a view to profit." The property owner insisted that this language refers to the nature of the activities occurring on the property rather than to whether or not the property owner is a nonprofit or for-profit organization. And, since the property was being used for religious purposes it should be exempt from tax despite the fact that it was owned by a for-profit business.

The state on the other hand claimed that it is the property's owner's use of the property rather than the lessee's use that is significant, and that the property owner in this used the property to generate rental income. The state argued that leasing property for a profit precludes exemption even when the lessee uses the property exclusively for religious purposes. It pointed out that the exemption statute (quoted above) specifically denies an exemption to property that is "leased or otherwise used with a view toward profit."

The appeals court agreed with the state's position, and ruled that the property was subject to property tax. It concluded that any property that is used for the primary purpose of producing income is used "with a view toward profit" and cannot exempt under the statute, and that "do decide otherwise would allow any private property not entitled to exemption to become tax exempt merely by leasing it to a religious or school organization."

Key point: Churches that rent property from a for-profit business should address the issue of property taxes in the rental agreement. The rental agreement should specify clearly which party will pay property taxes in the event the property is subject to tax. This often is overlooked.

Woman Slips on Icy Church Stairs

Court rules that church can be sued for injuries.

Church Law and Tax 1994-09-01 Recent Developments

Personal Injuries – On Church Property or During Church Activities

Key point: A church may be responsible for injuries occurring on church premises due to snow accumulation if the snow was either accumulated in an unnatural manner or negligently removed.

An Illinois appeals court ruled that a church could be sued for injuries sustained by a member who fell down snow and ice covered stairs on church premises. The victim went to her church at around 6:30 p.m. on a January evening to practice with her rock band, Romantic Fever, in the church basement. A member of the church board served as the band’s manager. The building is reached by a number of wooden stairs. The stairs have a handrail down the middle, but not on the sides. The victim left the church at 10 p.m. following the band rehearsal. As she faced the bottom of the stairs looking down, she could see a mixture of ice and snow on the right side of the steps to a depth of between one-half inch and three inches. Snow had been thrown to the left side of the stairs over the handrail and this side was impassable. The victim proceeded down the stairs and slipped on the first or second step. She fell down the rest of the stairs, injuring her back. She did not know the source of the snow on which she slipped, and did not know who had partially removed the snow from the steps. When asked whether anything about the stairs themselves contributed to her fall, she stated that there was no handrail down the right side and that the steps were warped. The board member noticed snow on the church steps on several occasions during the day of the accident. He discussed the problem with the pastor who was “very perturbed” that the snow was not being cleared within a reasonable time and was not being cleared to his satisfaction. The pastor expected complete snow removal, meaning edge to edge on the steps. Before the accident, the board member had talked with the church custodians (a husband and wife) about this problem and conveyed the minister’s feelings about complete snow removal. It was the custodians’ duty to remove snow from the stairs. The board member said following the accident that “had the snow removal been taken care of, this wouldn’t have occurred.” One the custodians stated that she had moved snow on the church stairs from one side to another on the day of the accident, but did not clear it completely. The woman sued the church, and a trial court threw the case out on the basis of the church’s motion for summary judgment. The woman appealed, and a state appeals court reversed the trial court’s decision and ordered the case to proceed to trial. The court observed that “there is generally no duty to remove natural accumulations of ice and snow” and that “[t]he mere removal of snow leaving a natural ice formation underneath does not constitute negligence.” However, a church or other property owner can be legally responsible for injuries in at two situations: (1) snow is removed in a negligent manner, or (2) “an injury occurred as the result of snow or ice produced or accumulated by artificial causes or in an unnatural way, or by the defendant’s use of the premises.” The court continued:

Here, there is sufficient evidence in the record from which a trier of fact could conclude that [the church] created or permitted to exist an unnatural accumulation of snow and ice on the steps. [The victim] testified that the snow had been removed from one side of the stairs and thrown over the handrail onto the other side. A jury could thus conclude that the ice on which [the victim] fell was caused by runoff from the snow piled on the other side of the stairs …. [The church] contends that [the victim] failed to show affirmatively that there was a “nexus” between the snow on the left side of the stairs and the ice on which [she] fell …. [T]he snow was piled on the left side of the stairs, separated from the opposite side by only a double handrail. It is reasonable to conclude that the ice on which [the victim] slipped came from the snow piled on the other side of the stairs.

The court rejected the church’s claim that there was no evidence that it was responsible for the accumulation of snow on the left side of the stairs. The court noted that “there was ample evidence from which a jury could conclude that [the church’s] agents were responsible for the unnatural accumulation of snow on the stairs.” It referred to the fact that the board member testified that the custodians were primarily responsible for snow removal at the church, and that volunteer groups at the church or church members themselves would occasionally remove some snow. There was no evidence that anyone not connected with the church ever removed snow from the church steps. Moreover, the court concluded, “even if we accepted the tenuous conclusion that some unknown person completely unconnected with the church gratuitously undertook to remove the snow from the steps, a question of fact would still exist concerning whether the church was chargeable with knowledge of the unnatural accumulation on the steps and would thus be liable on this basis.” The board member testified that he was aware of the situation prior to the date of the accident and had brought it to the attention of other church officials. Even if the church or its agents did not create the condition, “a jury could still find that it had knowledge of the condition and failed to correct it.” The court also ruled that the trial court erred in not considering the victim’s assertion that the church had been negligent in not constructing handrails on the sides of the stairway and in failing to correct the warped condition of the stairs. Graff v. St. Luke’s Evangelical Lutheran Church, 625 N.E.2d 851 (Ill. App. 2 Dist. 1993).

See Also: Premises Liability

Related Topics:

Defamation of Ministers by Denominational Officials

Court rules that chancellor’s statements were not defamatory.

Church Law and Tax 1994-09-01 Recent Developments

Libel and Slander

Key point: Critical statements made by a denominational official about a minister’s contentious relationship with the denomination are not defamatory per se.

An Illinois appeals court ruled that statements made about a priest by the chancellor of a Catholic diocese were not defamatory. A priest was removed from his parish assignment by his bishop because of the “extreme animosity” between him and members of a family within the church over an estate. A deceased family member left 160 acres to his son and daughter “for the perpetual use and benefit” of the church. The priest maintained that neither he nor the church was ever informed by the family about this gift. When the priest learned of the gift, a lawsuit was brought to determine the ownership of the 160 acre tract and the $160,000 in profits derived from the farming of this land. The court found that the land belonged to the church and ordered the property to be sold and the funds distributed as stipulated by the deceased family member. During this litigation the priest learned that a substantial portion of the funds had previously been loaned to a parochial high school foundation that was a subsidiary of the diocese. The priest contacted his bishop and the chancellor of the diocese and advised them that their actions were contrary to canon and civil law because they had been aware of the nature and source of the funds and had approved the diversion of the funds away from the local parish to the school foundation without “due process or authorization.” A short time later, the bishop issued a canonical decree, imposing the censure of suspension on the priest. The decree states, in relevant part:

[The priest] has repeatedly declined to meet with the bishop …. [The priest] in addition to severe exhortations and admonitions, has received warnings that he will be suspended if he refuses to cooperate. [His] wild charges have not been upheld by ecclesiastical courts or higher authorities. [He] threatens to continue his untrue and disruptive public statements.

The canonical decree also contained language that indicated the basis of the priest’s discipline: “Furthermore, since [the priest] is engaged in a secular profession without the permission of the diocesan bishop, he is forbidden to wear clerical garb or to present himself as in any way representing the Catholic Church. Moreover, since he has been absent from priestly assignment for a number of years … he will be considered a departed priest.”

The priest sued the bishop and diocese claiming that the decree amounted to defamation of his character. Specifically, he claimed that the decree’s statements characterizing him as a person who has made “wild charges” and who “threatens to continue his untrue and disruptive public statements” were “libelous per se”. A trial court dismissed the lawsuit and the priest appealed. On appeal, the priest argued that the trial court erred in dismissing his lawsuit because the decree constituted “libel per se”. The appeals court began its opinion by noting:

A statement is considered defamatory if it tends to cause such harm to the reputation of another that it lowers that person in the eyes of the community or deters third persons from associating with him. Statements that are considered to be defamatory per se occur when the defamatory character is apparent on its face, and are typically within one of four classifications, two of which are at issue here. They are (1) words that impute an inability to perform or want of integrity in the discharge of duties of office or employment, or (2) words that prejudice a party, or impute lack of ability in his trade, profession or business. Per se statements are so obvious and materially harmful to the plaintiff that injury to his or her reputation may be presumed …. In determining whether a statement is defamatory per se, courts apply the modified innocent construction rule. The modified innocent construction rule is as follows: “[A] written or oral statement is to be considered in context, with the words and the implications therefrom given their natural and obvious meaning; if as so construed, the statement may reasonably be innocently interpreted or reasonably be interpreted as referring to someone other than the plaintiff it cannot be actionable per se. A reviewing court must consider all parts of the publication in order to ascertain the true meaning of the words.”

From a reading of the statement as a whole, it appears that the thrust of the censure is based on [the priest’s] secular employment without the permission of the diocese, his absence from the diocese for a number of years, and his lack of regard for the warnings issued by the diocese. [The priest] does not dispute these charges or even claim that they are defamatory. [The decree’s] statements that [the priest] has made “wild charges” and “threatens to continue his untrue and disruptive public statements” do not on their face indicate that [he] is unable to discharge his duties for lack of integrity or impute a lack of ability to be a priest. Additionally, we find that a reading of these statements as not being actionable per se is reasonable under the modified innocent construction rule because they are directed to [the priest’s] relationship with … the diocese and do not pertain to his knowledge or ability to perform the duties of his profession. May v. Myers, 626 N.E.2d 725 (Ill. App. 3 Dist. 1993).

See Also: Defamation

Sexual Misconduct and Insurance Coverage

Insurance policies may not cover sexual misconduct by employees.

Church Law and Tax 1994-07-01 Recent Developments

Sexual Misconduct by Clergy and Church Workers

Key point: Church insurance policies may not provide a legal defense of lawsuits brought against pastors by victims of sexual seduction. Further, any money damages awarded by a court against a pastor may not be covered by the church’s policy.

An Illinois appeals court ruled that a liability insurance policy maintained by a counseling center did not necessarily exclude coverage for a counselor who sexually seduced a counselee. A psychotherapist who was employed by a secular counseling center initiated sexual contact with her. The two engaged in sexual intercourse on several occasions over a two-year period. The woman later sued her counselor, and the counseling center. She alleged that the counselor was guilty of breach of his fiduciary duties, assault and battery, and intentional infliction of emotional distress. She claimed that the counseling center was responsible for the counselor’s conduct on the basis of the legal doctrine of respondeat superior (under which an employer is liable for the negligent acts of its employees committed within the scope of their employment). The center was dismissed from the lawsuit on the ground that the counselor was not acting within the scope of his employment when he had sexual relations with the counselee. The center’s insurance company sent a letter to the center informing it that the insurance policy did not “afford coverage” for any of the claims against the counselor. It relied on the following language in the insurance policy:

We’ll pay amounts you or others protected under this agreement are legally required to pay as damages for covered professional liability claims …. Your employees are protected against covered claims while working for you within the scope of their duties.

The insurance company claimed that the center had been dismissed from the case on the ground that the counselor was not “working for the center within the scope of his duties” when he engaged in sexual contact with the counselee, and therefore the insurance policy provided no coverage for him. The insurance company asked a court for a “declaratory judgment” agreeing with its interpretation of the insurance policy. A court agreed with the insurance company’s interpretation. It noted that the sexual misconduct of a counselor in the course of a counseling relationship could be viewed as occurring within the scope of employment. It based this conclusion on the “transference phenomenon” which often occurs in the context of counseling. Counselees often develop a deep emotional dependence upon a counselor. The emotional dependence is called “transference” and is a typical reaction characterized by a counselee unconsciously attributing repressed feelings to the counselor. A counselor must be capable of properly responding to these feelings in order to avoid emotional involvement with the counselee and to assist the counselee in overcoming problems. The court observed that “[t]he mishandling of this phenomenon, which generally results in sexual relations or involvement between the psychiatrist or therapist and the patient, has uniformly been considered as malpractice or gross negligence ….” Since the transference phenomenon is so closely associated with the counseling relationship, the court noted that “the sexual misconduct of a therapist could be viewed as inside the scope of treatment under the guise of therapy.” However, it agreed with the insurance company that such a conclusion was not possible in this case since the lawsuit against the center had already been dismissed on the ground that the counselor’s acts did not occur within the scope of his employment. Accordingly, the counseling center’s insurance policy did not apply to the counselor’s acts, and he was not entitled to a legal defense or payment of any verdict or settlement against him.

The possible application of this case to churches and clergy is apparent. It suggests that church insurance policies may not cover clergy who engage in sexual relations with a counselee if the church is found to be free from responsibility on the ground that the minister’s acts were not within the scope of his or her employment. St. Paul Fire & Marine Insurance Company v. Downs, 617 N.E.2d 338 (Ill. App. 1 Dist. 1993). [PCL4K, PCL12A2, PCL12A4f]

See Also: Seduction of Counselees and Church Members | Negligent Selection | Liability Insurance

Members Sue to Dissolve Church

Their lawsuit was dismissed.

Key point: In some states church members have the authority to dissolve the church corporation if the church is unable to carry out its purposes due to internal dissension. However, members who have left the church or no longer meet the church bylaws' definition of "members" will not have the authority to do so.

An Illinois appeals court dismissed a lawsuit brought by members of a church seeking to dissolve their church and have a receiver appointed to liquidate church assets.

A schism occurred in a Baptist church over the retention of the pastor. Problems worsened due to disagreements over the pastor's plan to use church funds to build a school. Some members opposed placing a mortgage on the debt-free church building to raise construction funds. When efforts to remove the pastor and those deacons who supported him failed, some of the disgruntled members filed a lawsuit in civil court seeking an order dissolving the church and transferring its assets to a receiver for distribution to another nonprofit organization.

Illinois law permits a voting member or director to "involuntarily dissolve" a nonprofit corporation that is unable to carry out its purposes. The disgruntled members claimed that this procedure was available since the church was unable to carry out its purpose of conducting religious worship because of the controversy.

The pastor and those who supported him opposed this action on the grounds that the members who brought the lawsuit were not voting member of the church and the lawsuit was not a matter that could be resolved by the civil courts. The pastor and his supporters pointed out that the church bylaws defined a voting member as one who contributed at least $15 each month to the support of the church and that none of the members who brought the lawsuit satisfied this condition.

A trial court agreed to dissolve the church and turn over its assets to a receiver for distribution to another nonprofit organization. It acknowledged that these individuals did not satisfy the church's definition of voting members, but it concluded that this did not matter since the church bylaws contained no procedure for terminating a person's membership.

The court concluded that both sides of the dispute failed to operate the nonprofit corporation according to its charter and bylaws and thus the corporate status of the church had been abandoned. The pastor and his supporters appealed this ruling and a state appeals court reversed the trial court's decision.

The appeals court began its opinion by emphasizing that one must have "standing" to bring a lawsuit. Standing refers to some real interest or right in the subject matter of a lawsuit. The court concluded that the disgruntled members who filed the lawsuit lacked standing since they did not satisfy the church's definition of membership.

The court observed: "None [of these members] were currently making their $15 a month donations to the church as provided in the bylaws …. We are aware of the hostile atmosphere which undoubtedly prevailed against these [persons] at [the church]; however, this does not dissuade us from finding that [they] had relinquished their memberships at [the church] and were, at best, inactive or nonvoting members as of the filing of their [lawsuit]. As such, [they] could not bring an action for involuntary judicial dissolution …."

The court noted that even if the former members had standing to sue, they could not prevail since the civil courts lack jurisdiction to determine whether or not the church "could carry out its purposes since the court's decision of that issue [would violate] the first amendment's prohibition against civil courts' involvement in religious matters. The courts' authority to resolve disputes is narrowly circumscribed by the first amendment's guaranty that the right to the free exercise of religion will not be abridged. With the exception of certain types of property disputes, Illinois courts have generally refused to decide cases that require a judicial interpretation of religious doctrine or church law …. [T]he underlying dispute, who will be the pastor at [the church], is an ecclesiastical matter which is not within the court's purview." Hines v. Turley, 615 N.E.2d 1251 (Ill. App. 1993).

Related Topics:

Members’ Right to Inspect Church Records

An Illinois appeals court decision provides some guidance.

Under what circumstances do church members have a legal right to inspect church records? An Illinois appeals court decision provides some guidance.

Some of the members of a charitable organization incorporated under the state not-for-profit corporation law demanded to see various corporate records. Their request was denied by corporate officers, and the members sued. A trial court ruled in favor of the corporation, and the members appealed. A state appeals court reversed the trial court's decision, and ruled that the members had a broad right to inspect the corporation's records.

The court began its opinion by noting that the corporation was incorporated under the state not-for-profit corporation law, which contains the following provision regarding inspection of corporate records: "Each corporation shall keep correct and complete books and records of account … and shall keep at its registered office or principal office a record giving the names and addresses of its members entitled to vote. All books and records of a corporation may be inspected by any member entitled to vote or that member's agent or attorney, for any proper purpose at any reasonable time."

The court continued:

The [member] has the burden to establish he has a proper purpose to inspect the corporation's records. A proper purpose is shown when a shareholder has an honest motive, is acting in good faith, and is not proceeding for vexatious or speculative reasons; however, the purpose must be lawful in character and not contrary to the interests of the corporation. A proper purpose is one that seeks to protect the interests of the corporation and the [member] seeking the information …. [A member's] right to inspect a corporation's books and records must be balanced against the needs of the corporation depending on the facts of the case. Proof of actual mismanagement is not required; a good faith fear of mismanagement is sufficient to show proper purpose. The [member] is not required to establish a proper purpose for each record he requests. Once that purpose has been established, the [member's] right to inspect extends to all books and records necessary to make an intelligent and searching investigation and from which he can derive any information that will enable him to better protect his interests. The reference in [the not-for-profit corporation statute] to "all books and records" grant a [member] access to a broad range of a corporation's records; however, the access is limited to a showing of proper purpose. Once the purpose is established, the [member] may examine necessary books and records.

In reaching its decision, the court rejected the corporation's claim that granting the members' broad inspection request would violate the "privacy rights" of other members. The court also rejected the corporation's claim that it was being properly managed and therefore the members' request to inspect records to search for evidence of mismanagement was unwarranted. The members have a right to inspect records "to make that determination for [themselves]."

What This Means for Churches:

This decision represents a broad interpretation of a member's right to inspect corporate records. Since it involves an interpretation of the Illinois not-for-profit corporation act, and since many churches are incorporated under this statute in Illinois (and under similar provisions in other states), the court's interpretation is of relevance to all church leaders.

Meyer v. Board of Managers, 583 N.E.2d 14 (Ill. App. 1 Dist. 1991).

Counselors and the Clergy-Penitent Privilege

After a minister disclaims a counseling relationship, further communications are not privileged.

Church Law and Tax 1992-11-01 Recent Developments

Taxation – Church Property

An Illinois appeals court ruled that statements made by a criminal defendant to a minister could not be protected by the “clergy-penitent” privilege if the minister informed the defendant that he would not be his counselor. A man was prosecuted for criminal sexual assault against his 11-year-old stepdaughter. The stepdaughter testified that her stepfather had sexual intercourse with her more than 100 times, on virtually every occasion when the child’s mother “left the house.” The child was so traumatized that she attempted suicide. The stepfather was found guilty and sentenced to 28 years in a state penitentiary. At the trial, the prosecution relied in part on the testimony of a minister. The minister testified that the stepfather had contacted him three times by telephone, seeking counsel and advice. The minister told the stepfather during their second conversation that he would not be his counselor, since the stepfather had lied to him. Under the minister’s theology, these lies prevented him from entering into a counseling relationship with the stepfather. The minister testified that during their third conversation, the stepfather admitted to having had sexual intercourse with his stepdaughter on 25 to 50 occasions. The stepfather argued on appeal that the minister should not have been permitted to testify because of the clergy-penitent privilege. Specifically, her claimed that the privilege applied (and therefore the minister should not have been permitted to testify) because he contacted the minister “to confess and for spiritual guidance, and the conversation was in confidence as no third party was present.” A state appeals court ruled that the conversations with the minister were not covered by the clergy-penitent privilege, and accordingly that it was appropriate for the minister to testify. The court observed: “It is clear from the record that the privilege did not apply under the statute. [The minister] testified that [the stepfather] was disqualified from his counsel. He told [the stepfather] that prior to the conversation regarding the number of incidents that he would not be his counselor. Thus [the stepfather’s] statements to the minister were not obtained by the minister in his professional character or as a spiritual adviser.” The stepfather had argued that the confessions he made to the minister should be privileged even if the minister did not consider himself to be a spiritual adviser at the time, since “it is the perception of the penitent which is determinative.” In other words, if the penitent believes that he is making a confession to a minister acting as a spiritual adviser then the privilege applies even if the minister does not believe he is acting in such a role. In rejecting this claim, the court noted that it was not supported by the language of the Illinois clergy-penitent privilege statute. The court continued: “Furthermore, [the stepfather’s] perception of the privilege existing is not supported by the record. [The minister] told him he would not act as his counselor in the second conversation. The fact the minister accepted the stepfather’s third phone call and agreed to talk to him fails to establish the stepfather’s claim that an ‘illusion of being [his] counselor’ was created in view of the minister’s admonishment to [the stepfather]. The stepfather asserts that he approached the minister only in his capacity as a minister; however, this point does not create the privilege where [the stepfather] was told by the minister that the minister was not his counsel.” This case suggests that if a minister specifically disclaims a counseling relationship with a particular “counselee,” then any further communications to the minister are not privileged even if the counselee believes they are. People v. Bole, 585 N.E.2d 135 (Ill. App. 2 Dist. 1991).

See also Child abuse, Walstad v. State, 818 P.2d 695 (Alaska App. 1991), and Church records, Hutchison v. Luddy, 606 A.2d 905 (Pa. Super. 1992), in the recent developments section of this newsletter.

See Also: The Clergy-Penitent Privilege

Internal Church Disputes

Courts cannot interfere in ecclesiastical matters.

Church Law and Tax1992-05-01Recent Developments

Officers, Directors, and Trustees

An Illinois appeals court concluded that it had no authority to resolve an internal church dispute regarding the membership of a church’s board of deacons. A local congregation adopted bylaws in 1988 that conflicted with the provisions of the hierarchical denomination with which it was affiliated. Among other things, the bylaws of the local church were never approved by the parent organization, and did not contain a statement that the church would be an “indivisible and inseparable part” of the denomination. The church elected deacons under the 1988 bylaws, and these individuals later were deposed by the denomination. A lawsuit was brought in civil court to determine the legal authority of the deposed deacons. A trial court ruled that it had no authority to resolve such a dispute, and the case was appealed to a state appeals court. The appeals court began its opinion with the following observation:

The court, as a governmental agency of the state, is charged generally with the task of resolving disputes. Its authority to do so, however, in matters of internal church disputes, including those which concern the control or ownership of property, is narrowly circumscribed by the first amendment’s guarantee that the right to the free exercise of religion will not be abridged. By reason of this limitation, civil courts have no authority to resolve church disputes which turn on matters of church doctrine, practice, polity, or administration …. Where doctrinal controversy is not involved in a church dispute, however, mandatory deference to religious authority is not required by the first amendment, and the court may choose from a variety of approaches in resolving the dispute. One such approach, the “neutral principles of law” approach … has been recognized, and where appropriate, applied in Illinois. Under the neutral principles approach, the court objectively examines pertinent church charters, constitutions and bylaws, deeds, state statutes, and other evidence and resolves the matter the same as it would a secular dispute.

The deposed deacons argued that the court should resolve this dispute since it did not involve “doctrinal matters” and could be resolved on the basis of non-doctrinal “neutral principles of law.” The court disagreed. It observed: “In our opinion, resolution of the questions of who the true members of the board of deacons of the Chicago parish are and which bylaws govern it would require this court to delve, impermissibly, into matters of church doctrine and polity.” The court relied on the following language from a 1976 decision of the United States Supreme Court: “[W]here resolution of the disputes cannot be made without extensive inquiry by civil courts into religious law and polity, the [first amendment] mandates that civil courts shall not disturb the decisions of the highest ecclesiastical tribunal within a church of hierarchical polity, but must accept such decisions as binding on them, in their application to the religious issues of doctrine or polity before them.” Accordingly, the court had no authority to resolve the dismissed deacons’ claim that their dismissal was improper. It rejected the dismissed deacons’ claim that this case involved secular issues that could be resolved using neutral principles of law. In rejecting this contention the court observed: “[T]he real questions presented here are: Who governs? And by what rules? Stated otherwise, which of the factions should be recognized as the true members of the board of deacons?” St. Mark Coptic Orthodox Church v. Tanios, 572 N.E.2d 283 (Ill. App. 1991).

See Personal injuries—on church property and during church activities, Karen S. v. Streitferdt, 568 N.Y.S.2d 946 (A.D. 1 Dept. 1991).

See Also: Removal of Officers, Directors, and Trustees

Property Tax Exemption and Rental of Church Facilities

Church facilities are tax exempt when rented to another nonprofit corporation, court rules.

Church Law and Tax 1992-05-01 Recent Developments

Taxation – Church Property

Does a church-owned building lose its property tax exemption when it is rented to another charitable organization? No, concluded an Illinois appeals court. A Lutheran church owned a 3-story building that no longer was used for religious purposes. The church chose to rent the building rather than sell it, since it hoped to utilize the property for religious purposes in the future. Accordingly, it rented the building to a nonprofit dance school that conducted dance lessons and performances. The church received $14,400 in rent in 1986. A tax assessor claimed that the building was no entitled to an exemption from property taxation. A trial court rejected the assessor’s position, and the case was appealed. The appeals court acknowledged that the “burden of proving the right to an exemption is upon the person seeking it,” and that “in determining whether property is included within the scope of an exemption, all facts are to be construed and all debatable questions resolved in favor of taxation. Nevertheless, the court concluded that the building was entitled to exemption under a state law that exempted “all property of institutions of public charity … when such property is actually and exclusively used for such charitable and beneficent purposes, and not leased or otherwise used with a view to profit.” The court relied on a 6-factor test announced in an earlier decision by the Illinois Supreme Court for determining whether a particular property is entitled to a charitable exemption. The supreme court previously ruled that a property is entitled to exemption if the property owner can prove each of the following 6 factors:

(1) The benefits derived are for an indefinite number of persons; (2) the organization has no capital, capital stock, or shareholders, and does not profit from the enterprise; (3) funds are derived mainly from private and public charity, and are held in trust for the objects and purposes expressed in its charter; (4) charity is dispensed to all who need and apply for it; (5) no obstacles are placed in the way of those seeking the benefits; Nd (6) the primary use of the property is for the charitable purposes.

The tax assessor conceded that the first 3 factors were satisfied, but it claimed that the last 3 were not. The appeals court disagreed, noting that “a charitable institution does not lose its tax-exempt status merely because persons who are unable to pay for its services are required to do so, as long as the institution makes no profit and all the funds are used to further the organization’s charitable goals.” The court emphasized that the amounts charged by the dance studio for instruction “were substantially less than enough to cover regular, operating expenses.” It concluded: “Property satisfies the exclusive use requirement of the property tax exemption statutes if it is primarily used for the exempted purpose, even though it is also used for a secondary, or incidental purpose …. The test is ‘whether the primary purpose of the institution is charitable, or whether its primary purpose is the making of a profit and the devoting of these profits to charitable purposes.” Resurrection Lutheran Church v. Department of Revenue, 571 N.E.2d 989 (Ill. App. 1991).

See Also: Property Taxes

Church Responsibility for Minor’s Injuries during Church Activities

Churches may be liable for injuries sustained at events they sponsor.

Church Law and Tax 1992-01-01 Recent Developments

Personal Injuries – On Church Property or During Church Activities

Can a church be legally responsible for injuries sustained by a minor who fell out of a tree during a church picnic? No, concluded the Illinois Supreme Court. The minor (a 15-year-old boy) and his parents attended a church picnic at a nearby lake. There was a rope swing attached to a tree which was used to swing into the lake. The boy had been to the lake many times before, and had used the rope swing on several occasions. He was aware that the rope occasionally would become entangled in branches after being released by the person jumping from the swing. When the rope became entangled, someone had to climb the tree to untangle it. On the day of the accident, the victim used the rope swing several times while his parents watched some 20 feet away. After some 10 swings, the rope became entangled in branches, and the victim climbed the tree to untangle it. On his way down, the victim fell to the ground, and received injuries that left him a quadriplegic. The boy’s parents, an associate pastor of the church, and several picnickers saw him use the swing and climb up the tree. No one attempted to stop him, but his parents and the associate pastor cautioned him to be careful. The boy and his parents sued the church (and the owner of the property where the picnic occurred). The lawsuit alleged that the church negligently failed to provide adequate supervision of the picnic area, and failed to warn the boy of the dangerous conditions existing on the property. A trial court and state appeals court both rejected the church’s request to be dismissed from the case. The church appealed the case to the state supreme court, which ordered the church dropped from the lawsuit. The supreme court emphasized that a church or any other organization cannot be legally responsible for injuries to a minor that are caused by obvious conditions. It observed: “There are many dangers, such as those of fire and water, or of falling from a height, which under ordinary conditions may reasonably be expected to be fully understood and appreciated by any child …. It is well settled that if the condition [causing an injury] presents obvious risks which children would be expected to appreciate and avoid, there is no duty to remedy that condition. The rationale for this rule is that, since children are expected to avoid dangers which are obvious, there is no reasonably foreseeable risk of harm.” The court further observed: “We cannot ignore the fact that [the victim] was a 15-year-old youth … who acknowledged in a deposition that he was aware of the risk of falling. On one occasion, plaintiff in fact saw a person who had climbed the tree fall approximately three feet and catch himself on the tree’s lower branches.” In concluding, the court noted: “While we are not unsympathetic to the tragedy of [the boy’s] accident, we are obliged to defer to the authority established by this court in the area of negligence actions. Based on our review of law in this area, we conclude that the risk of falling out of the tree was an obvious danger which [the boy] was reasonably expected to understand and appreciate.” Logan v. Old Enterprise Farms, Ltd., 564 N.E.2d 778 (Ill. App. 1990).

See Unincorporated churches, Foster v. Purdue University, 567 N.E.2d 865 (Ind. App. 1991).

See Also: Negligence as a Basis for Liability – Defenses

Temporarily Vacant Church Buildings and Property Tax Exemption

When a congregation moves, must it pay property tax on its old building?

Church Law and Tax 1991-07-01 Recent Developments

Taxation – Church Property

In an important decision, an Illinois state appeals court ruled that a church building does not lose its property tax exemption when it is temporarily vacant following the congregation’s move to another location. A Lutheran church owned a piece of property on which was located a single building consisting of a church, an office, and a parsonage. The church and parsonage portions of the property were connected by the office. In 1985, following the minister’s retirement, the church merged with a campus ministry at a nearby state university. Thereafter, church activities were conducted at the campus location. The church attempted to sell its old building, but was not successful for nearly a year. During that year, the church and office portions of the property were used for storage of church property, including church records, pews, hymnals, an altar, a cross, the church pipe organ, and other furnishings. The church portion also was used for the storage of clothing and other materials prior to shipment to missionary sites. The parsonage portion of the building was not occupied during the year that the property was for sale. It too was used to store miscellaneous items of church property. The state department of revenue asserted that the building was not exempt from property taxes during the year in question because it was not being used for exempt purposes. The church appealed this determination, and an administrative judge within the department of revenue ruled that the church and office portions of the property were exempt but not the parsonage. The church appealed this ruling to a state court which concluded that the entire property was exempt. The state appealed this ruling, and a state appeals court upheld the trial court’s decision exempting the entire property from taxation. The court began its opinion by noting that Illinois law exempts from property taxation “all property used exclusively for religious purposes … including all such property owned by churches or religious institutions or denominations and used in conjunction therewith as parsonages or other housing facilities provided for ministers.” On appeal, the state conceded that the church and office portions of the property were exempt, but it insisted that the parsonage no longer was entitled to exemption since it was vacant and therefore could not be said to be used “exclusively for religious purposes.” Further, the state insisted that the building should be “divided” for tax purposes, with the church and office retaining their tax exemption and the parsonage being subject to tax. The court rejected both claims. It noted that the entire property had been used for exempt purposes for more than 40 years, and that no portion of the property currently was being used for a non-exempt purpose. The court concluded: “We do not think that mere temporary vacancy or lack of use of a portion of an otherwise exempt parcel of property renders that portion taxable. To hold that when a portion of a building otherwise used for an exempt purpose becomes temporarily vacant or unused it loses its exempt status is nonsensical and impractical of application. Nor do we think it is practical to divide this parcel of property, consisting of a single building, on the basis of temporary vacancy of a portion of it. We find that the parsonage … portion of the church property continued to be used exclusively for religious purposes ….” The court acknowledged that tax exemptions are to be “strictly construed in favor of taxation.” However, “they are not to be unreasonably construed. A decision based upon an erroneous, arbitrary or unreasonable construction of a statute cannot stand.” The court concluded by observing: “Under the facts of this case, where the property consists of a single building which has been used for an exempt purpose for 40 years, but of which a portion becomes temporarily vacant due to the retirement of the church’s pastor but is not used for a non-exempt purpose, we find denial of the tax exemption for that portion to be unreasonable and improper as a matter of law.” Our Savior Lutheran Church v. Department of Revenue, 562 N.E.2d 1198 (Ill. App. 5 Dist. 1990).

Property Taxes

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