Denominational Legal Responsibility for Local Churches

There are several legal defenses available to a denominational agency that is sued as a result of the acts or obligations of affiliated clergy and churches.

Richard R. Hammar, Attorney, CPA

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State: New York
Categories: Denominations - Legal Liability

Church Law & Tax Report

Denominational Legal Responsibility for Local Churches

There are several legal defenses available to a denominational agency that is sued as a result of the acts or obligations of affiliated clergy and churches.

Richard R. Hammar, J.D., LL.M., CPA

Key point 10-18.3. There are several legal defenses available to a denominational agency that is sued as a result of the acts or obligations of affiliated clergy and churches. These include a lack of temporal control over clergy and churches; a lack of official notice of a minister’s prior wrongdoing in accordance with the denomination’s governing documents; lack of an agency relationship; the prohibition by the First Amendment of any attempt by the civil courts to impose liability on religious organizations in a way that would threaten or alter their polity; and elimination or modification of the principle of joint and several liability.

* A New York court ruled that the national Boy Scouts of America was not legally responsible for the drowning death of a scout because it did not exercise supervision or control over the activities of local troops. A 15-year-old Boy Scout drowned while on an overnight camping trip as he attempted to cross a rain-swollen river. The boy’s parents sued the BSA and a local council, claiming that they were responsible for the boy’s death based upon negligent supervision. The BSA insisted that it did not supervise or control the day-to-day activities of the scout troop or the scoutmasters. A trial court dismissed the BSA from the lawsuit, and a state appeals court affirmed. It concluded, “The BSA did not exercise supervisory control over the troop or the adult leaders who accompanied the boy scouts on the trip …. The plaintiffs failed to raised a triable issue of fact in this regard.” O’Lear v. Boy Scouts of America, 821 N.Y.S.2d 903 (N.Y. Sup. Ct. 2006).

Legal Developments

Enforced Moral Codes

Churches can impose scriptural or moral standards on their employees, and such efforts will be fully protected by the civil courts?o long as they do so fairly and uniformly.

Richard R. Hammar, Attorney, CPA

Bio

State: New York
Categories: Breach of Contract, Contracts, Employment Practices

Church Law & Tax Report

Enforced Moral Codes

Churches can impose scriptural or moral standards on their employees, and such efforts will be fully protected by the civil courts—so long as they do so fairly and uniformly.

Richard R. Hammar, J.D., LL.M., CPA

Key point 8-06. The civil courts have consistently ruled that the First Amendment prevents the civil courts from applying civil rights laws to the relationship between a church and a minister.

Key point 8-08.1. Title VII of the Civil Rights Act of 1964 prohibits employers engaged in commerce and having at least 15 employees from discriminating in any employment decision on the basis of race, color, national origin, gender, or religion. Religious organizations are exempt from the ban on religious discrimination, but not from the other prohibited forms of discrimination.

* A federal court in New York ruled that church-operated schools can enforce “moral codes” on their employees, but only if they do so fairly and uniformly and not in ways that disproportionately and adversely affect persons (such as pregnant, since women) who are protected by employment discrimination law. A woman (the “plaintiff”) taught a fifth grade class at a church-operated school. She was required to teach one hour of Bible study per day and spent the remainder of her day teaching secular subjects. Shortly after the start of her third academic year, the plaintiff informed the school principal that she was pregnant; that she intended to follow through with the pregnancy; and that she did not intend to marry the father of the unborn child. Based on her decision not to marry the child’s father, the principal informed plaintiff that she would have to bring the matter to the attention of the governing board of the school and initiate termination proceedings. In a subsequent meeting, the board voted to terminate plaintiff “in that her pregnancy outside of marriage was evidence of fornication.” The principal thereafter sent the plaintiff a letter informing her that the board had voted to terminate her employment for exhibiting “immoral or unsatisfactory personal conduct inconsistent with the principles of the church.” The plaintiff sued the church that operated the school, claiming that it had unlawfully discriminated against her on the basis of pregnancy in violation of state and federal law.

The school required all teachers to sign an employment agreement prior to the start of each academic year. The employment agreement states that the employee and employer shall “be bound by” various specified policies. One of these policies stated: “Termination is discontinuance of salary and employment at any time by the employing organization, at their sole discretion. An employee may be terminated for, but not limited to, the following reasons: … Immoral or unsatisfactory personal conduct inconsistent with the principles of the church.” Another policy listed “fornication” under “grievous sins for which members shall be subject to discipline.” Plaintiff did not recall being given a copy of these policies and also denied being aware that “immoral or unsatisfactory personal conduct” could be grounds for termination. She claimed to be unaware that having sexual relations outside of marriage was contrary to the teachings of the church.

In arguing that she was singled out for termination because of her pregnancy, plaintiff maintained that other teachers at the school were having sexual relations outside of marriage, which she knew based on “talking with them about their relationships.” However, she admitted to having no knowledge whether any member of the school administration had ever been informed of such conduct. She testified that she was aware of one teacher who taught at the school while pregnant and separated from her husband during at least part of the pregnancy.

Ministerial exception

The church insisted that the “ministerial exception” required the plaintiff’s lawsuit to be dismissed. The ministerial exception generally prohibits the civil courts from resolving employment disputes between churches and their ministers. The court agreed that this rule has been applied in some cases to non-ordained church employees whose primary duties consist of “teaching, spreading the faith, church governance, supervision of a religious order, or supervision or participation in religious ritual and worship.” However, the court concluded that the ministerial exception did not apply in this case since plaintiff’s teaching duties were primarily secular, and her religious duties were limited to one hour of Bible instruction per day and attending religious ceremonies with students once per year. The court stressed that there was no evidence that the plaintiff included church teachings when she taught secular subjects.

Pregnancy discrimination

Title VII of the Civil Rights Act of 1964 prohibits discrimination in employment on the basis of gender or pregnancy. Title VII applies to any employer engaged in interstate commerce and having 15 or more employees. The court summarized the “burden shifting” analysis that is used in resolving Title VII discrimination claims.

First, the plaintiff must establish a prima facie case by showing that he or she (1) is a member of a protected class, (2) was qualified for the position in question, and (3) suffered an adverse employment action (4) under circumstances giving rise to an inference of discrimination. The prima facie case “raises an inference of discrimination” that the employer must rebut.

Second, the burden then shifts to the employer “to articulate some legitimate, nondiscriminatory reason for the employee’s rejection.” If the employer meets this burden, the presumption of discrimination set by the prima facie case is dropped.

Third, the burden or proof shifts back to the employee to show that the reasons given by the employer are a pretext for discrimination. Pretext may be shown “either directly by persuading the court that a discriminatory reason more likely motivated the employer or indirectly by showing that the employer’s purported explanation is unworthy of credence.”

Here, there was no dispute that the plaintiff established a prima facie case of pregnancy discrimination. As a pregnant woman she was a member of a protected class; she was qualified for the teaching position at the school; and she suffered an adverse employment action by being terminated. The church countered that plaintiff was not terminated because of her pregnancy but because of her failure to abide by the church’s doctrine that fornication is a “grievous sin.”

Where an employer has articulated a religious reason for the allegedly discriminatory adverse employment action, the plaintiff may not challenge the plausibility of that religious reason. The court must presume that “an asserted religious motive is plausible in the sense that it is reasonably or validly held.”

The focus of the court’s inquiry then becomes pretext, including “factual questions such as whether the asserted reason for the challenged action comports with the defendant’s policies and rules, whether the rule applied to the plaintiff has been applied uniformly, and whether the alleged nondiscriminatory purpose was stated only after the allegation of discrimination.” The court concluded:

In cases where religious school employers have asserted fornication as a reason for terminating a pregnant unmarried woman, courts have held that an employer enforcing such a policy unevenly—e.g., only against women or only by observing or having knowledge of a woman’s pregnancy—is evidence of pretext. This is because a school violates Title VII if, due purely to the fact that women can become pregnant and men cannot, it punishes only women for sexual relations because those relations are revealed through pregnancy. Thus, while a religious school employer may validly seek to impose moral doctrine upon its teaching staff, punishment singularly directed at [women] without regard to [men] is not permissible.

The court noted that the church provided no evidence “that any other teacher has been terminated from the school for engaging in sexual relations outside of marriage. Knowledge of other teachers engaging in extramarital sexual relations, as reported by plaintiff, cannot be imputed to the defendant. But the church fails to explain how it has enforced a policy against such behavior, if it exists, to both males and females. Moreover, the church admits to considering plaintiff’s pregnancy as evidence of fornication.” The court concluded that “the issues raised by plaintiff … at least raise a question regarding whether the church’s policy is applied in a discriminatory fashion and whether plaintiff was terminated because of her sex and pregnancy, as prohibited by Title VII.”

The church insisted that the plaintiff knew about its policy against extramarital sexual relations and that the annual employment contracts she signed “legitimized” her termination. The court disagreed, noting that “there can be no prospective waiver of an employee’s rights under Title VII” and that “Title VII’s strictures are absolute and represent a congressional command that each employee be free from discriminatory practices.” Therefore, “employment contracts, no matter what the circumstances that justify their execution or what the terms, may not be used to waive protections granted to an individual under Title VII or any other Act of Congress.”

The sole issue was “whether the church terminated plaintiff because of her sex and pregnancy or because of an evenly applied religious and moral code.”

Application. This case is important for three reasons. First, it demonstrates that churches can impose scriptural or moral standards on their employees, and such efforts will be fully protected by the civil courts—so long as they do so fairly and uniformly and not in ways that disproportionately and adversely impact persons (such as pregnant women) who are protected by federal or state employment discrimination laws. As the court noted, “In cases where religious school employers have asserted fornication as a reason for terminating a pregnant unmarried woman, courts have held that an employer enforcing such a policy unevenly—e.g., only against women or only by observing or having knowledge of a woman’s pregnancy—is evidence of pretext. This is because a school violates Title VII if, due purely to the fact that women can become pregnant and men cannot, it punishes only women for sexual relations because those relations are revealed through pregnancy. Thus, while a religious school employer may validly seek to impose moral doctrine upon its teaching staff, punishment singularly directed at [women] without regard to [men] is not permissible.”

Second, the court rejected the church’s claim that the plaintiff consented to being terminated for immoral conduct when she signed her annual employment contract. The court disagreed, noting that “there can be no prospective waiver of an employee’s rights under Title VII” and that “Title VII’s strictures are absolute and represent a congressional command that each employee be free from discriminatory practices.” Therefore, “employment contracts, no matter what the circumstances that justify their execution or what the terms, may not be used to waive protections granted to an individual under Title VII or any other Act of Congress.”

Third, the court’s rejection of the application of the ministerial exception to the plaintiff represents a very narrow reading of the exception that has not been shared by several other courts. Redhead v. Conference of Seventh-Day Adventists, 440 F.Supp.2d 211 (E.D.N.Y. 2006).

Legal Developments

Sexual Harassment and Church Employees

A federal court in New York ruled that a local church and denominational agency could be sued for the sexual harassment of a church employee by two pastors.

Richard R. Hammar, Attorney, CPA

Bio

State: New York
Categories: Sexual Harassment, Sexual Misconduct by Clergy, Lay Employees, and Volunteers

Church Law & Tax Report

Sexual Harassment and Church Employees

A federal court in New York ruled that a local church and denominational agency could be sued for the sexual harassment of a church employee by two pastors.

Richard R. Hammar, J.D., LL.M., CPA

Key point 8-08. Title VII of the Civil Rights Act of 1964 prohibits employers engaged in commerce and having at least 15 employees from discriminating in any employment decision on the basis of race, color, national origin, gender, or religion.

* A federal court in New York ruled that a local church and denominational agency could be sued for the sexual harassment of a church employee by two pastors. A woman (Jane) was hired by a church to operate the parish office. Her responsibilities included maintaining finances, accounting of incoming money, banking deposits, managing financial reports, cutting payroll checks, paying monthly bills, scheduling church and community functions at the parish hall, addressing parishioners telephone inquiries, and preparing bulletins. In addition to these responsibilities, she worked closely with parishioners and their families for baptisms, funerals, weddings, and other services.

A few years after Jane was hired, the church’s senior pastor handed her a “floppy disk” and instructed her to print a letter that was contained on the disk. When she opened the disk she discovered that it contained pornographic images. When she asked the pastor why he gave her a disk with pornographic images, he allegedly responded, “What do you think?” Jane told him that his behavior was unacceptable. Following this incident, Jane claimed that the pastor increased his supervision over her, ridiculed her in front of others, accused her of incompetence for incorrect financial statements and the loss of a $25,000 donation check. Jane also claimed that the church’s associate pastor sexually harassed her. She alleged that on several occasions when she was away from her office she returned to find the associate pastor in her office looking at pictures of nude men on her computer.

Jane reported the actions of both pastors to the church’s business administrator, who recommended that Jane contact a denominational office (regional church) for assistance. A denominational official went to great lengths to resolve her complaints, but was unsuccessful in doing so. As a result, Jane sued her employing church and the regional church for sexual harassment and sex discrimination in violation of Title VII of the Civil Rights Act of 1964. Title VII prohibits employers having at least 15 employees and engaged in interstate commerce from discriminating in employment decisions on the basis of race, color, national origin, sex, or religion. The law defines “sex” to include sexual harassment.

The employing church

The church argued that the court lacked jurisdiction over Jane’s Title VII sexual harassment claim and so the case had to be dismissed. It pointed out that Title VII only applies to employers having at least 15 employees, and since it had less than 15 employees it was not an “employer” subject to Title VII.

The court rejected this argument, based on a recent United States Supreme Court decision holding that the 15 employee requirement under Title VII was not a matter of jurisdiction, but rather an element of a plaintiff’s claim. This means that an employer cannot have a Title VII lawsuit against it dismissed by a court on the basis of a lack of jurisdiction, even though the employer has fewer than 15 employees and therefore is not an “employer” subject to Title VII. See Arbaugh v. Y&H Corporation, 126 S.Ct. 1235 (2006) (discussed in the recent developments section of this newsletter under the topic “Employment practices”). Employers with fewer than 15 employees who are sued under Title VII must raise the “fewer than 15 employees” defense in their response to a plaintiff’s lawsuit. It is not a jurisdictional defect that can be challenged by the employer at any time, even after a case is resolved.

The regional church

The regional church argued that it was not an employer under Title VII and that Jane was not its employee, and therefore her Title VII sexual harassment claim against it had to be dismissed. In support, the regional church relied solely on Jane’s admission that it did not hire her or provide her with a salary, retirement benefits, health insurance benefits, life insurance benefits, disability benefits, or premiums for any such programs.

The court noted that Title VII defines a covered employer as “a person engaged in an industry affecting commerce who has fifteen or more employees for each working day in each of twenty or more calendar weeks in the current or preceding calendar year, and any agent of such a person.” Title VII defines an “employee” as “an individual employed by an employer.” The court noted that “the question of whether someone is or is not an employee under Title VII usually turns on whether he or she has received direct or indirect remuneration from the alleged employer. The remuneration may be in the form of a salary or consist of substantial benefits not merely incidental to the activity performed.”

Jane argued that the regional church could be liable, even if it did not directly hire or employ her, under the so-called “joint employer” doctrine if she could prove that it “controlled certain aspects of her employment with the church, including her compensation, privileges, terms, and conditions.” The court concluded:

There is well-established authority under this theory that, in appropriate circumstances, an employee, who is technically employed on the books of one entity, which is deemed to be part of a larger “single-employer” entity, may impose liability for certain violations of employment law not only on the nominal employer but also on another entity comprising part of the single integrated employer. Under the “single-employer” doctrine, also known as the “joint employer” theory, an employee, formally employed by one entity, who has been assigned to work in circumstances that justify the conclusion that the employee is at the same time constructively employed by another entity, may impose liability for violations of employment law on the constructive employer, on the theory that this other entity is the employee’s joint employer.

In assessing whether a joint employer relationship exists, courts generally look for evidence of (1) interrelation of operations, (2) centralized control of labor relations, (3) common management, and (4) common ownership or financial control.

The court noted that the regional church had offered no evidence disproving the elements of the single-employer theory. On the other hand, Jane testified that she was directed to perform duties by the regional church; that she attended training offered by the regional church; that she participated in the regional church’s group plan health insurance; and that the regional church controlled aspects of her compensation, hours, and job duties. These allegations were sufficient, with no contrary evidence from the regional church, to raise questions regarding common ownership and control between the employing church and regional church. As a result, the court declined the regional church’s request to dismiss Jane’s claims against it. Krasner v. Diocese, 431 F.Supp.2d 320 (E.D.N.Y. 2006).

Legal Developments

Legal Owners of Church Property

A New York court ruled that a parent denomination held title to the property of a local church that voted to disaffiliate from the denomination.

Richard R. Hammar, Attorney, CPA

Bio

State: New York
Categories: Church Property

Key point 7-03.3. Most courts apply the "neutral principles of law" rule in resolving disputes over the ownership and control of property in "hierarchical" churches. Under this rule, the civil courts apply neutral principles of law, involving no inquiry into church doctrine, in resolving church property disputes. Generally, this means applying neutral legal principles to nondoctrinal language in any one or more of the following documents: (1) deeds to church property; (2) a church's corporate charter; (3) a state law addressing the resolution of church property disputes; (4) church bylaws; or (5) a parent denomination's bylaws.

A New York court ruled that a parent denomination held title to the property of a local church that voted to disaffiliate from the denomination.

The members of a Methodist church voted to withdraw from The United Methodist Church (UMC). The UMC asked a court for a declaration that it was the legal owner of the church's property. The court noted that it could resolve a property dispute between a local church and a parent denomination so long as it could do so by applying "neutral principles of law." The focus in resolving such a dispute is "on the language of the deeds, the terms of the local church charter, state statutes governing the holding of church property, and the provisions in the constitution of the general church concerning the ownership and control of church property."

The court concluded:

Although nothing in the deeds, the certificate of incorporation of the church or the state statutes governing the holding of church property discusses the property rights of a member of the UMC, the Book of Discipline of the UMC, which binds [affiliated churches], states that all property deeded to a UMC church or its predecessor is required to be held in trust for the UMC or its predecessor. Absent an express trust provision in the deed, an implied trust is created where, as here, the property is conveyed to a local church of the UMC or any predecessor to the UMC; the name, customs and polity of the UMC or any predecessor to the UMC are used in such a way that the local church is known to the community as part of such denomination; and the congregation of the local church accepts the ordained ministers appointed by a bishop of the UMC or any predecessor to the UMC. We therefore conclude that Â… the [local church in this case] held its property in an implied trust for the UMC.

What this means for churches

Most church property disputes are resolved on the basis of neutral principles of law contained in deeds, local church charters and bylaws, and denominational bylaws. So long as a civil court can resolve such a dispute by referring to neutral provisions in these documents, without any inquiry into doctrine or polity, it may do so. The court in this case concluded that local churches affiliated with the UMC held their title in trust for the national church as a result of non-doctrinal provisions in the UMC Book of Discipline.

The United States Supreme Court has noted that one of the principal advantages of the neutral principles of law approach to resolving church property disputes is that it permits religious organizations to "order their affairs" in advance of a property dispute through "appropriate reversionary clauses and trust provisions" that could reflect the intentions of a church and its members. Many churches and denominational agencies have done so. Several examples are cited in section 7-04 of Richard Hammar's book, Pastor, Church & Law (3rd ed. 2000). North Central New York Annual Conference v. Felker, 816 N.Y.S.2d 775 (N.Y.A.D. 2006).

Legal Developments

Inspecting Church Records

Most state nonprofit corporation laws give members a legal right to inspect corporate records for a “proper purpose.”

Richard R. Hammar, Attorney, CPA

Bio

State: New York
Categories: Church Members, Church Records, Confidential and Privileged Communications

Key point 6-03.1. Church members generally have no right to inspect church records unless such a right is conferred by state nonprofit corporation law, a church's charter or bylaws, state securities law (if the church has issued securities), or a subpoena. Church records enjoy no privilege against disclosure, with the exception of documents that are protected by the clergy-penitent privilege under state law.

A New York court ruled that members of churches incorporated under the state nonprofit corporation law have a legal right to inspect church records so long as they act in good faith and for a proper purpose, and their request pertains to records that are relevant and necessary to the proper purpose.

A church member asked to inspect certain church records. When his request was denied, he asked a court to compel the church to turn over the records pursuant to a provision in the state nonprofit corporation law giving "any person who shall have been a member of record of the corporation for at least six months immediately preceding his demand" to have access to the records of the corporation. A trial court denied the member's request, but this ruling was reversed on appeal.

A state appeals court noted that while the member was no longer a member of the church's board of deacons, his status as a member of the congregation during the six months preceding his request to inspect church records was sufficient to trigger the right of inspection. The court further noted that the nonprofit corporation law permitted members to inspect corporate records only when acting in good faith and for a "proper purpose." The court concluded that both of these requirements were met in this case.

However, the court concluded that the member's description of the records he wanted to inspect was vague, and that "to the extent that the demand is over-broad, the [trial court] may exercise its discretion to narrow its focus so that the church is required to produce only those records that are relevant and necessary for [the member's] purposes.

What this means for churches

This case illustrates three important points. First, most state nonprofit corporation laws give members a legal right to inspect corporate records for a "proper purpose." As a result, members of churches that are incorporated under such a law have a legal right to inspect specified records. Second, a right of inspection only applies to members. The New York law confers a right of inspection only on persons who have been church members for the six months preceding their request for inspection. Third, a request for inspection will be denied, or limited, if it is "over-broad." That is, the church is only required to disclose records that are relevant and necessary to the request for inspection.

Smith v. Calvary Baptist Church, (N.Y.A.D. 2006).

Legal Developments

Risks of Pastoral Counseling Services

Church leaders should never ignore “warning signs” that a staff member (employee or volunteer) has a propensity to engage in a particular kind of harmful conduct.

Richard R. Hammar, Attorney, CPA

Bio

State: New York
Categories: Clergy - Discipline and Removal, Sexual Harassment, Sexual Misconduct by Clergy, Lay Employees, and Volunteers

Church Law & Tax Report

Risks of Pastoral Counseling Services

Church leaders should never ignore “warning signs” that a staff member (employee or volunteer) has a propensity to engage in a particular kind of harmful conduct.

Richard R. Hammar, J.D., LL.M., CPA

Key point 10-12. Churches face a number of legal risks when they offer counseling services by ministers or laypersons. These include negligent selection, retention, or supervision of a counselor who engages in sexual misconduct or negligent counseling. A church also may be vicariously liable for a counselor’s failure to report child abuse, breach of confidentiality, and breach of a fiduciary relationship.

* A New York court ruled that a husband whose wife was seduced by a pastor while serving as a marriage counselor could sue the pastor and church for breach of a fiduciary duty, and the church for negligent supervision and negligent retention. A pastor provided marital counseling to a couple in his church. In addition to serving as a marriage counselor, the pastor presided over various church-sponsored functions, including weekend “marriage retreats,” which the couple attended. On one occasion the pastor informed the husband that some church members were alleging that the pastor was having an affair with the wife. The wife, and the pastor, both assured the husband that the accusations were false. The husband then asked the church to investigate and was advised that the proper procedure was to file a grievance. Prior to filing the grievance, the husband and his wife met with a church officer who urged him not to file a grievance that would cause negative publicity for the church and would ultimately result in no findings because the accusations were false. The husband agreed not to file a grievance, and the pastor continued to provide marital counseling to the couple for another two years until the wife finally admitted that she and the pastor were romantically involved.

Upon learning of the relationship, the husband sued the pastor. He also sued the church and a regional denominational agency (the “church defendants”) for breach of a fiduciary duty, negligent supervision, negligent retention, and emotional distress.

Breach of a fiduciary duty

The court noted that in New York a fiduciary relationship “requires a showing of a relation between two persons when one of them is under a duty to act for or to give advice for the benefit of another upon matters within the scope of the relation,” and that “emotional and psychological damages are recoverable on a claim for breach of fiduciary duty.”

The court concluded that the pastor’s decision to act as marriage counselor made him a fiduciary. It put him “in a position of trust, in which he had a duty to act honestly and advise [the husband] in furtherance of his interest in preserving his marriage, which was the object of the relationship.” The court noted that the husband’s lawsuit alleged “acts of disloyalty and injurious conduct” by the pastor, and that “this is not just a case of a minister engaged in a consensual sexual relationship while acting as a spiritual adviser.” Instead, the husband’s allegations “if proven, are sufficient to sustain a claim of breach of fiduciary duty against [the pastor], for deceiving him and undermining his marriage, while continuing to act as his marriage counselor.”

However, the court ruled that any sexual relationship between the pastor and the wife was outside the scope of the pastor’s duties, meaning that the church defendants could not be liable for the pastor’s conduct.

Negligent supervision and retention

The court noted that a claim for negligent supervision or retention arises “when an employer places an employee in a position to cause foreseeable harm, harm which the injured party most probably would have been spared had the employer taken reasonable care in supervising or retaining the employee.” An “essential element” of both negligent supervision and negligent retention is that the employer “knew or should have known of the employee’s propensity for the conduct that caused the injury.”

The court concluded that the husband’s lawsuit stated a valid claim for negligent retention and supervision against the church defendants:

A fair reading of the complaint is that [the pastor] engaged in marriage counseling and conducted church-sponsored marriage retreats on their behalf. Assuming that the church defendants knew, or should have known, that he was having sexual relations with plaintiff’s wife, then they could be held liable for negligent supervision and/or retention in light of the allegations that: (1) [a church officer] received accusations from three parishioners about the affair; (2) the plaintiff’s wife was not an isolated case; (3) the [church officer] dissuaded plaintiff from filing a grievance which would have resulted in an investigation; and (4) the [church officer] represented that the accusations were false when he knew, or should have known, otherwise. Plaintiff alleges that the officer was told that the pastor was having an affair with plaintiff’s wife and for two and a half years, the church defendants permitted the marital counseling to continue, while actively discouraging plaintiff from initiating an investigation. Thus, accepting plaintiff’s version of the facts, the church defendants knew, or should have known, of the pastor’s propensity to engage in harmful conduct, but decided to look the other way.

Emotional distress

The court dismissed the husband’s claim for emotional distress. It noted that such a claim must allege “outrageous conduct that exceeds the bounds of decency tolerable in civilized society,” and “is a theory of liability that is to be invoked only as a last resort.” Further, “when the complained-of conduct is embraced by a traditional tort which provides for emotional damages, the cause of action for infliction of emotional distress should be dismissed. Such is the case here where viable claims for the traditional torts of breach of fiduciary duty and negligent supervision and/or retention, exist.”

Application. This case illustrates two important legal principles with which church leaders should be familiar. First, when pastors serve a marriage counselors, it is much more likely that they will be deemed to be engaged in a “fiduciary relationship.” This means that they have a duty to act in the best interests of counselees and do nothing to harm them. A breach of this duty may lead to personal liability.

Second, the court ruled that a church may be liable on the basis of negligent supervision for failing to adequately supervise a pastor if it “knew or should have known” of the pastor’s propensity to commit conduct that causes injury to another person. Similarly, a church may be responsible on the basis of negligent retention for retaining a pastor after it “knew or should have known” of the pastor’s propensity to cause harm to others. The lesson is clear. Church leaders that ignore “warning signs” that a staff member (employee or volunteer) has a propensity to engage in a particular kind of harmful conduct may expose their church to liability on the basis of negligent supervision or negligent retention if the staff member harms one or more persons while engaging in the same kind of harmful conduct. Warning signs must be promptly addressed, and appropriate actions taken. A good question to ask is this, “How would a jury view our response to information suggesting that a staff member constitutes a risk of harm to others? Would a jury conclude that we have acted in a reasonable manner, and that our response was appropriate in light of the nature of the risk?” 820 N.Y.S.2d 682 (N.Y. Sup. 2006).

Legal Developments

Civil Liability for Failure to Report Child Abuse

Mandatory reporters who fail to report abuse can be subject to possible criminal liability and can be sued for money damages by the victims of abuse.

Richard R. Hammar, Attorney, CPA

Bio

State: Arkansas
Categories: Child Abuse, Child Abuse Reporting

Key point 4-08. Every state has a child abuse reporting law that requires persons designated as mandatory reporters to report known or reasonably suspected incidents of child abuse. Ministers are mandatory reporters in many states. Some states exempt ministers from reporting child abuse if they learned of the abuse in the course of a conversation protected by the clergy-penitent privilege. Ministers may face criminal and civil liability for failing to report child abuse.

A federal court in Washington ruled that a mandatory child abuse reporter’s failure to report the abuse of a minor by a church worker could result not only in criminal liability for the reporter, but also civil liability for the reporter and his employing church. A minor (the “plaintiff”) who was sexually molested by a church worker sued the church, claiming that it was liable for the worker’s acts on the basis of its failure to comply with the state child abuse reporting statute.

The church insisted that the state child abuse reporting law imposes criminal liability on mandatory reporters who fail to report abuse, but does not explicitly impose civil liability, and therefore the plaintiff could not sue the church for monetary damages in a civil lawsuit. The court conceded that courts in other states have generally refused to allow victims of child abuse to sue mandatory reporters who fail to report, but it noted that all of those rulings were in other states.

The plaintiff acknowledged that the reporting statute did not explicitly authorize civil lawsuits for failure to report, but argued that such a right could be “implied” from the statute. It pointed to a Washington Supreme Court case that articulated three factors for the courts to consider in deciding if a statute creates a civil remedy: “First, whether the plaintiff is within the class for whose benefit the statute was enacted; second, whether legislative intent, explicitly or implicitly, supports creating or denying a remedy; and third, whether implying a remedy is consistent with the underlying purpose of the legislation.”

The court concluded that these factors supported a finding in this case that the state child abuse reporting law created a civil remedy in favor of abused minors and against mandatory reporters who fail to report abuse:

The plaintiff, a victim of childhood sexual abuse, certainly falls within the class of persons the statute is designed to protect. Washington courts have clearly stated that the mandatory reporting statute is designed “to secure prompt protection or treatment for the victims of child abuse ….” Second, the legislative intent behind the statute supports the creation of a civil remedy. It is true that [the statute] provides a penal remedy, but not a civil remedy. [The church] asserts that such a penal remedy indicates that the legislature did not intend to imply a civil remedy also. However, this court recognizes, just as Washington state courts have recognized, that when a statute is enacted for the protection of a particular class of individuals, a violation of its terms may result in civil as well as criminal liability, even though the former remedy is not specifically mentioned therein …. The logical conclusion is that the legislative intent supports the creation of a civil remedy for victims of child sexual abuse when those mandated to report the abuse fail to do so. Likewise, the Court finds that implying a civil remedy is consistent with the underlying purpose of the statute. The declared intent of the statute is “to prevent further abuses, and to safeguard the general welfare of such children.” RCW 26.44.010. Implying a civil cause of action against those who are mandated to report child abuse, but fail to do so, will motivate those required to report to take action, and furthers the goals of the statute itself. Accordingly, the Court finds that there is an implied private cause of action stemming from the statutory requirement to report child abuse.

Application. Eight states (Arkansas, Colorado, Iowa, Michigan, Montana, New York, Ohio, and Rhode Island) have enacted laws that create civil liability for failure to report child abuse. In these states victims of child abuse can sue adults who failed to report the abuse. Not only are adults who fail to report abuse subject to possible criminal liability (if they are mandatory reporters), but they also can be sued for money damages by the victims of abuse. In each state, the statute only permits victims of child abuse to sue mandatory reporters who failed to report the abuse. No liability is created for persons who are not mandatory reporters as defined by state law.

Most state child abuse reporting laws do not specifically authorize victims of abuse to sue mandatory reporters who failed to report the abuse. Several courts have addressed the issue of whether to recognize such a civil remedy apart from any specific language in the statute creating one. Most have not. The decision of the Washington federal court reflects the minority position. As a result, mandatory reporters in Washington may be subject to both criminal and civil liability for failing to report known or reasonably suspected incidents of child abuse. Fleming v. Corporation of the President of the Church of Jesus Christ of Latter Day Saints, 2006 WL 753234 (W.D. Wash. 2006).

See a summary of the child abuse reporting laws of all 50 states.

Legal Developments

Church Property Ownership

A denominational agency was entitled to the property of a local church following a vote to disaffiliate itself from the denomination.

Richard R. Hammar, Attorney, CPA

Bio

State: New York
Categories: Church Property

Key point 7-03.3. Most courts apply the "neutral principles of law" rule in resolving disputes over the ownership and control of property in "hierarchical" churches. Under this rule, the civil courts apply neutral principles of law, involving no inquiry into church doctrine, in resolving church property disputes. Generally, this means applying neutral legal principles to non-doctrinal language in any one or more of the following documents: (1) deeds to church property; (2) a church's corporate charter; (3) a state law addressing the resolution of church property disputes; (4) church bylaws; or (5) a parent denomination's bylaws.

A New York court ruled that a denominational agency was entitled to the property of a local church following a vote to disaffiliate itself from the denomination. A church which was originally incorporated as a Methodist Episcopal Church eventually became a member of the United Methodist Church (UMC) after a series of mergers. The church voted to withdraw from the UMC, and a denominational agency (the "regional church") voted to dismiss the church as a member of the UMC. The regional church asked a civil court to declare that it was the legal owner of the church's property. The court noted that the civil courts "may decide matters involving property disputes between local churches and the general church provided that resolution of the property dispute is possible by application of neutral principles of law." The focus in resolving such disputes is "on the language of the deeds, the terms of the local church charter, the state statutes governing the holding of church property, and the provisions in the constitution of the general church concerning the ownership and control of church property."

The court noted that nothing in the deeds, the certificate of incorporation of the church or state statutes governing the holding of church property addressed the property rights of a member of the UMC. However, it noted that "the Book of Discipline of the UMC, which binds plaintiff, states that all property deeded to a UMC church or its predecessor is required to be held in trust for the UMC or its predecessor." It concluded that "an implied trust is created where, as here, the property is conveyed to a local church of the UMC; the name, customs and polity of the UMC or any predecessor to the UMC are used in such a way that the local church is known to the community as part of such denomination; and the congregation of the local church accepts the ordained ministers appointed by a bishop of the UMC or any predecessor to the UMC. We therefore conclude that the court properly determined that the church held its property in an implied trust for the UMC." North Central New York Annual Conference v. Felker, 816 N.Y.S.2d 775 (N.Y.A.D. 2006).

Legal Developments

Religious and Sexual Orientation Discrimination

A New York court ruled that a church could be sued by a former employee for discriminating against him on the basis of his religion and sexual orientation.

Richard R. Hammar, Attorney, CPA

Bio

State: New York
Categories: Employment Practices, Freedom of Religion

Church Law & Tax Report

Religious and Sexual Orientation Discrimination

A New York court ruled that a church could be sued by a former employee for discriminating against him on the basis of his religion and sexual orientation.

Richard R. Hammar, J.D., LL.M., CPA

Key point 8-12. Many state civil rights laws prohibit employers with a specified number of employees from discriminating in any employment decision on the basis of the sexual orientation of an employee or applicant for employment. Such laws generally exempt religious organizations.

* A New York court ruled that a church could be sued by a former employee for discriminating against him on the basis of his religion and sexual orientation. A homosexual, Jewish man was employed by a church in an administrative capacity. The employee claimed that his supervisor acted in a hostile manner toward him because of his sexual orientation and religious background, and that she undermined him in his job performance and treated him differently than she did heterosexual employees. The employee alleged that on one occasion his supervisor said to him, “I wonder how the officers would feel if they knew they had a Jewish fag working for them.” The employee claimed that he reported the harassing behavior to church officials, but was reprimanded for doing so and within a few weeks was dismissed. The former employee sued the church, claiming that it was responsible for its supervisor’s acts of religious and sexual orientation discrimination. He asked the court to award him back pay, front pay or reinstatement, compensatory and punitive damages, interest, attorney’s fees, and costs.

The church argued that it was exempt from the anti-discrimination provisions of the civil rights laws of the State of New York and New York City. The court conceded that both laws permit religious organizations to limit employment or give preference to persons of the same religion or denomination, or to promote the religious principles of the organization. However, the court noted, “those limited exemptions for religious organizations are a far cry from letting them harass their employees and treat the employees in an odiously discriminatory manner during their employment, and to use derogatory expressions toward the employees …. Thus, the claims cannot be dismissed due to defendant’s status as a religious organization.”

The court did dismiss the sexual orientation discrimination claim under state law since it was not enacted until after the alleged discrimination. But, the court allowed the former employee to sue the church for sexual orientation discrimination under the city civil rights law, and for religious discrimination under both the state and city laws. It concluded, “Invidious discrimination, including by religious institutions, has no place in our society. If the allegations made by plaintiff are true, he should be compensated for defendant’s bad acts.”

Application. This case is important for three reasons. First, it is the first published case to find a church liable for discriminating against an employee on the basis of sexual orientation. The issue of discrimination by churches in employment decisions on the basis of sexual orientation was addressed fully in the July-August 2004 edition of this newsletter. Several states, like New York, have laws prohibiting private employers with a specified number of employees from discriminating in employment decisions on the basis of sexual orientation. Each of these laws has a broad exemption for religious organizations. To illustrate, the New York state law provides: “Nothing contained in this section shall be construed to bar any religious or denominational institution or organization, or any organization operated for charitable or educational purposes, which is operated, supervised or controlled by or in connection with a religious organization, from limiting employment … or giving preference to persons of the same religion or denomination or from taking such action as is calculated by such organization to promote the religious principles for which it is established or maintained.” The City of New York municipal code contains an almost identical provision. Such language clearly is broad enough to apply to the church in this case, and the court’s ruling to the contrary represents a very narrow interpretation of the law that may well be reversed on appeal.

Second, this case illustrates that some cities have enacted ordinances banning discrimination by employers on the basis of sexual orientation. It is imperative for church leaders to be familiar with their own municipal ordinances as well as federal and state employment laws. The court conceded that the state law banning sexual orientation discrimination in employment did not apply to the church since it was not enacted until after the alleged discrimination occurred. However, it ruled that the church could be sued for violating a similar ban contained under the municipal code.

Third, the court ruled that the church could be sued for religious discrimination. Once again, state and city laws contain a broad exemption from the ban on religious discrimination, and the court’s narrow interpretation of these exemptions is vulnerable to reversal on appeal. Logan v. Salvation Army, 809 N.Y.S.2d 846 (Sup. Ct. 2005).

Legal Developments

Child Abuse Reporting

A New York court ruled that the subject of a child abuse report had no legal right to obtain the name of the person who reported the abuse.

Richard R. Hammar, Attorney, CPA

Bio

State: New York
Categories: Child Abuse, Child Abuse Reporting

Key point 4-08 . Every state has a child abuse reporting law that requires persons designated as mandatory reporters to report known or reasonably suspected incidents of child abuse. Ministers are mandatory reporters in many states. Some states exempt ministers from reporting child abuse if they learned of the abuse in the course of a conversation protected by the clergy-penitent privilege. Ministers may face criminal and civil liability for failing to report child abuse.

A New York court ruled that the subject of a child abuse report had no legal right to obtain the name of the person who reported the abuse, despite his claim that he needed the reporter's identity so that he could sue him for filing a false and malicious report.

A public school employee reported a suspected case of child abuse to state authorities. The report identified the suspected perpetrator of the abuse (the plaintiff). Upon learning that he was accused of child abuse, the plaintiff sued the school for defamation and emotional distress. When the school refused to disclose the name of the employee who reported the abuse, the plaintiff sought a court order compelling the school to disclose the reporter's identity.

A trial court granted the order, but a state appeals court reversed this ruling. The appeals court noted that the state child abuse reporting law specifies that reports of child abuse "shall be confidential and shall only be made available" to certain persons and agencies listed in the statute. While persons who are the subject of a report are entitled to a copy of the report, the law specifies that "nothing in this [law] shall be construed to permit any release, disclosure or identification of the names or identifying descriptions of persons who have reported suspected child abuse or maltreatment to the statewide central register … without such persons' written permission."

The court agreed with the plaintiff that the child abuse reporting law allows the subject of a child abuse report to sue the reporter for monetary damages if the reporter did not act in good faith and acted with willful misconduct or gross negligence. However, the court noted that the statute "made no exception for the disclosure of the name of the person reporting the suspected abuse where there is an allegation that such person acted with willful misconduct or gross negligence, and we decline to read an implied exception into the statute."

The court conceded that its conclusion "may make it difficult for plaintiff to pursue his action, but our holding is consistent with the intent of [the law] to protect the confidentiality of the names of the persons reporting suspected child abuse [since] disclosure of sources of information could have a chilling effect, thus hampering agency efforts in providing services to distressed families. If a party alleging defamation, such as plaintiff here, could obtain the names of the reporters by simply commencing a defamation action, any such exception would swallow the rule of reporter confidentiality."

Application . Church leaders who report child abuse (or who are considering doing so) often wonder if their identity will be revealed to the alleged abuser. This case demonstrates that a reporter's identity may be kept confidential as a result of state law, even if this means that it will be difficult if not impossible for alleged abusers to exercise their right under a child abuse reporting law to sue a reporter for making a false or grossly negligent report. Selapack v. Iroquois Central School District, 794 N.Y.S.2d 547 (N.Y. App. 2005).

Legal Developments

Are Churches Exempt from City Water Assessments?

Yes, one court ruled.

Richard R. Hammar, Attorney, CPA

Bio

State: New York
Categories: First Amendment, Freedom of Religion

Background

A city's department of environmental protection attempted to collect water and sewer charges from a church. The church's request for an exemption was denied because the church property contained apartments for three staff members (the pastor, church business administrator, and a full-time teacher at a church-operated school).

The pastor wrote the city, claiming that "we are a religious organization, providing this community with a vital service. Our only income are gifts that come from the members of this community. We cannot pay these charges, moreover, we are entitled to exemption." The city disagreed, and assessed $12,000 in back charges against the church and imposed a "tax lien" on the church's property. The church appealed. It asked a court to grant its exemption from the water and sewer charges, reverse the city's assessments and penalties against it, and remove the tax lien.

A city ordinance contained the following exemption: "The real estate owned by any religious corporation … actually dedicated and used exclusively as a place of public worship [is] hereby exempt from the payment of any sum of money, whatsoever to said city, for the use of water taken by same from said city." A similar exemption applies to sewer charges.

The court's ruling

The appeals court ruled that the exemption of religious corporations from water and sewer charges "should be interpreted as applying to all property used in furtherance of the corporation's purpose," and in this case "that would include the housing provided its pastor, teacher and administrator staff promoting the primary purpose of the institution."

The court added that even if the staff members who were provided housing were not promoting the purposes of the church, the city should have granted a "partial exemption" for all of the church's property less the three apartments. The city's denial of any exemption was "legally wrong, arbitrary and capricious."

What this means for churches

Many cities exempt churches from water and sewer fees. This case demonstrates that such an exemption will not necessarily be lost because of uses of church property that "promote the primary purpose" of the church.

Bathelite Community Church v. Department of Environmental Protection, 797 N.Y.S.2d 707 (N.Y. Sup. Ct. 2004).

Legal Developments

Child Abuse Reporting

A New York court ruled that a school principal and counselor could be personally liable for failing to report suspected child abuse to state authorities.

Richard R. Hammar, Attorney, CPA

Bio

State: New York
Categories: Child Abuse, Child Abuse Reporting

Key point 4-08 . Every state has a child abuse reporting law that requires persons designated as mandatory reporters to report known or reasonably suspected incidents of child abuse. Ministers are mandatory reporters in many states. Some states exempt ministers from reporting child abuse if they learned of the abuse in the course of a conversation protected by the clergy-penitent privilege. Ministers may face criminal and civil liability for failing to report child abuse.

A New York court ruled that a school principal and counselor could be personally liable for failing to report suspected child abuse to state authorities.

A 9-year-old girl informed her mother that she had been sexually molested by her half-brother, Anthony. The mother reported this information to a school counselor who referred the girl to a counseling center for professional counseling. The mother then informed the school principal of Anthony's behavior. A few months later, the mother learned that Anthony had been subjecting two other sisters to continuous acts of sexual intercourse and she immediately called the police. The mother later sued the school counselor and principal for failing to report the allegations of sexual abuse to the statewide central register of child abuse. New York's child abuse reporting law requires mandatory reporters to report child abuse "when they have reasonable cause to suspect that a child coming before them in their professional or official capacity is an abused or maltreated child, or when they have reasonable cause to suspect that a child is an abused or maltreated child where the parent, guardian, custodian or other person legally responsible for such child comes before them in their professional or official capacity and states from personal knowledge facts, conditions or circumstances which, if correct, would render the child an abused or maltreated child."

The child abuse reporting law specifies that "any person, official or institution required by this title to report a case of suspected child abuse or maltreatment who knowingly and willfully fails to do so shall be civilly liable for the damages proximately caused by such failure."

Both the school counselor and principal were mandatory reporters under state law, and as such were potentially liable for failing to report the information shared with them by the mother. They claimed, however, that reportable child abuse was defined by state law to include only such abuse as is inflicted upon a minor by a "parent or other person legally responsible for his care." The counselor and principal argued that since Anthony was not a person "legally responsible" for the care of any of the victims, they were not required to report the mother's allegations of abuse as required by state law. The court disagreed. It concluded,

It is not the duty of the mandated reporter to assess whether the abuser would be considered by Family Court to be a "person legally responsible" or whether a "person legally responsible" allowed the abuse to occur. If [the mandated reporter] has reasonable cause to suspect that a child has been sexually abused, the reporter must report immediately. It is the duty of the investigating agency to determine whether the report was founded.

Application . This case demonstrates two important points. First, mandatory reporters of child abuse under state law may be personally liable for failing to report known or reasonably suspected cases of child abuse. A listing of each state that imposes liability on mandatory reporters who fail to report abuse is contained in a feature article that appeared in the May-June 2004 issue of this newsletter. Second, the court in this case concluded that the principal and counselor could be personally liable for failing to report suspected child abuse even though they did not believe reportable abuse had occurred since Anthony was not a person "responsible for the care" of the victims. The court ruled that it is the duty of the state, and not mandatory reporters themselves, to determine if a perpetrator of child abuse is someone "responsible for the care" of the victim. As a result, the principal and counselor erred in not reporting the suspected abuse, and letting the state decide whether or not the abuse met the definition of reportable abuse under the law. Catherine G. v. County of Essex, 761 N.Y.S.2d 727 (Sup. Ct. 2003).

Legal Developments

Child Abuse

A New York court ruled that a teacher who failed to report a known case of child abuse could not be sued by the parents of the victim.

Richard R. Hammar, Attorney, CPA

Bio

State: New York

Key point 4-08 . Every state has a child abuse reporting law that requires persons designated as mandatory reporters to report known or reasonably suspected incidents of child abuse. Ministers are mandatory reporters in many states. Some states exempt ministers from reporting child abuse if they learned of the abuse in the course of a conversation protected by the clergy-penitent privilege. Ministers may face criminal and civil liability for failing to report child abuse.

A New York court ruled that a teacher who failed to report a known case of child abuse could not be sued by the parents of the victim.

A 16-year old male (Kevin) attended a summer theatre program where he was sexually molested by a male instructor. The instructor was later convicted of a felony, and sent to prison. Kevin's parents sued the offender, and they also sued a music teacher at the school Kevin attended. They claimed that Kevin informed his music teacher about the molestation, but that the teacher failed to report the abuse to civil authorities as required by the state child abuse reporting law.

The reporting law specifies, "Any person, official or institution required by this title to report a case of suspected child abuse or maltreatment who knowingly and willfully fails to do so shall be civilly liable for the damages proximately caused by such failure." Teachers are among the list of persons required to report suspected abuse or maltreatment of a child, "when they have reasonable cause to suspect that a child coming before them in their professional or official capacity is an abused or maltreated child."

Kevin's mother claimed that the teacher's failure to report the abuse of her son "prevented [her] from being able to take protective measures to safeguard her son from [the molester's] continued harassment" for approximately six months, until she learned of the incident from another source, and that she herself "suffered grievous emotional, mental and physical pain and suffering" as a result.

A state appeals court concluded that the child abuse reporting statute did not provide parents with a legal basis to sue mandatory child abuse reporters who fail to report. It observed, "The mere provision of a civil remedy for 'damages proximately caused' by a failure to comply with mandatory reporting statutes does not, in this court's view, signal an intention by the legislature to impose liability for harm suffered by individuals other than the subject child."

In summary, the child abuse reporting law only permits monetary damages to be awarded to children for injuries they suffer as a result of a mandatory reporter's failure to report child abuse. Parents of victims of child abuse have no right to sue for damages under the statute.

Application . A number of state child abuse reporting law impose liability on mandatory child abuse reporters for injuries caused by their failure to report. The New York court concluded that such a provision only permits children themselves to sue mandatory reporters for damages resulting from a failure to report; their parents are not allowed to sue for damages incurred by their children.

The court noted that Kevin had been repeatedly harassed by the molester following the initial incident of molestation, and so there was ample basis for him to sue for the additional injuries he had incurred as a result of the teacher's failure to report. But, his parents had no right to do so. Lurene F. v. Olsson, 740 N.Y.S.2d 797 (N.Y. App. 2002).

Legal Developments

Personal Injuries on Church Property and During Church Activities

A federal court in New York ruled that an “auto exclusion” in a church insurance policy left a church without insurance to cover the death of one child and serious injuries to another.

Richard R. Hammar, Attorney, CPA

Bio

State: New York

Richards v. Princeton Insurance Company, 178 F. Supp.2d 386 (S.D.N.Y. 2002)

Key point 10-11. A church may be legally responsible on the basis of negligent supervision for injuries resulting from a failure to exercise adequate supervision of its programs and activities.

Negligence as a Basis for Liability

A federal court in New York ruled that an "auto exclusion" in a church insurance policy left a church without insurance to cover the death of one child and serious injuries to another as a result of an accident involving a rented bus.

A church youth group went on a trip in a rented bus. After arriving at the destination, some members of the youth group entered the bus while it was parked and unattended. Once inside, they accidentally disengaged the parking brake and caused the bus to roll down a hill, killing one member of the youth group and seriously injuring another. Parents of the victims sued the bus company as well as the church.

The parents claimed that the church was responsible for the accident because it "negligently, carelessly and recklessly supervising the boys who were alone on the bus when the parking brake was released; in permitting the four minors to board the bus when no driver or other adult was present; in failing to properly monitor and control the four boys who entered the bus; and failing to keep a proper lookout over the children; in failing to instruct its students not to board a school bus unsupervised."

The church had a comprehensive general liability policy that required the insurer to "pay those sums that the insured becomes legally obligated to pay as damages because of bodily injury or property damage to which this insurance applies." However, the policy contained an "auto exclusion" for "bodily injury or property damage arising out of the ownership, maintenance, use or entrustment to others of any auto owned or operated by or rented or loaned to any insured." The insurer claimed that the lawsuit against the church was not covered by the insurance policy because of the auto exclusion.

The church insisted that the auto exclusion did not apply because it chartered the bus, and did not own, operate, or rent the bus. It also asserted that the basis of the lawsuit was the church's alleged negligent supervision of the boys who entered the bus and released the parking brake, and that a negligent supervision claim was not excluded by the auto exclusion. The court disagreed, noting that the church's argument "would require an analytical stretch that strains the common sense meaning of common words and thus tears at the fabric of law."

The court noted that the auto exclusion applied to bodily injury "arising out of" the ownership, maintenance, and use of an automobile, and it concluded that the term "arising out of" must be interpreted "in a broad and comprehensive sense to mean originating from or growing out of the use of the automobile." The court concluded that the accident "arose out of" the use of the bus, and therefore the exclusion applied:

There was a substantial connection between the church's use of the bus in question and the victims' injuries and death. Specifically, the record indicates that the church hired the bus and driver for use on a field trip. The bus was a necessary element of the school trip, without which the church would have been unable to travel [to the destination]. That use presumably began at the commencement of the trip, when the bus was available and accessible to the church, and remained continuous for so long as the church, under the terms of the rental, had some measure of dominion or control over the availability of the vehicle for the purpose covered by the agreement. That the bus was not in operation transporting passengers on the road, but rather was parked following the first part of the trip, did not render it less subject to the church's use.

In fact, the church availed itself of the bus's travel and stationary storage capacity by permitting children to return to, and wait inside, the bus. Access to the bus merely for the purpose of waiting in it for any legitimate reason would constitute as much "use" of the vehicle as actual conveyance of passengers and goods from one point to another.

On the bus, as the parents allege, the children presumably disengaged the parking brake and the bus rolled down the hill to cause the injuries. That the children did not wait on the bus in an orderly manner is to be expected; it is common experience that children often act rambunctiously on school buses.

Accordingly, the court concludes that the church's use of the bus pursuant to their rental agreement, and the church's supervision of children during the trip, are inseparably intertwined, so that the victims' injuries and death here asserted undoubtedly arose out of the church's use of the bus during the trip.

The court also rejected the church's claim that it had chartered, not rented, the bus in question and therefore the auto exclusion did not apply. It noted that "any distinction between a charter and rental is a distinction without a difference."

Application . Church leaders in this case may have assumed that the church's comprehensive general liability policy covered injuries resulting from the use of vehicles. If so, this was a costly mistake that left the church without insurance to cover defense costs, and a jury verdict, in a case involving the death of one child and serious injuries to another. The potential verdict in this case could be substantial, and the same is true of legal fees.

What lesson can be learned from such a case? Church leaders must review their insurance coverages periodically to be sure there are no "gaps" that might expose the church to a substantial uninsured risk. The church had purchased a comprehensive general liability policy, but this policy excluded any claims associated with the use of an automobile or other vehicle. A comprehensive general liability policy usually is purchased to cover risks arising out of the use or possession of property, and may exclude injuries resulting from the use of vehicles.

Legal Developments

Church Records

A New York court ruled that a member had a legal right to inspect church records on the basis of a provision in the not-for-profit corporation law.

Richard R. Hammar, Attorney, CPA

Bio

State: New York
Categories: Church Records

Key point 6-03.1 . Church members generally have no right to inspect church records unless such a right is conferred by state nonprofit corporation law, a church's charter or bylaws, state securities law (if the church has issued securities), or a subpoena. Church records enjoy no privilege against disclosure, with the exception of documents that are protected by the clergy-penitent privilege under state law.

A New York court ruled that a member had a legal right to inspect church records on the basis of a provision in the not-for-profit corporation law.

A church member requested permission to inspect certain books and records of his church for the years 1997 to present. He relied on the following section of the New York Not-For-Profit Corporation Law (under which the church was incorporated):

Upon the written request of any person who shall have been a member of record for at least six months immediately preceding his request … the corporation shall give or mail to such member an annual balance sheet and profit and loss statement or a financial statement performing a similar function for the preceding fiscal year, and, if any interim balance sheet or profit and loss or similar financial statement has been distributed to its members or otherwise made available to the public, the most recent such interim balance sheet or profit and loss or similar financial statement. The corporation shall be allowed a reasonable time to prepare such annual balance sheet and profit and loss or similar financial statement.

The church denied the member's request to inspect church records on the ground that his "fellowship" had been "suspended" by his failure to tithe and to take "the Lord's Supper." The court rejected this excuse, noting that the church's bylaws "do not define either fellowship or the effect of suspension," and that the bylaws "clearly set out a different criteria for expulsion of one's membership, which affords a member an opportunity to resign and a hearing, neither of which has occurred. In fact, it is uncontested that no process of expulsion has occurred." The court concluded that the member was "simply trying to enforce his secular rights as a member, using the church's own criteria of membership and the pastor's own admission that plaintiff has not been expelled as a member."

The court rejected the church's claim that its first amendment rights would be violated by an inspection of its records, since "the questions involved here are not concerned with internal ecclesiastical or religious issues, but purely secular ones."

The court concluded that the member "has demonstrated a good faith basis and proper purpose in seeking the inspection, while [the church] has failed to carry its burden of demonstrating bad faith."

What this means for churches

This case provides church leaders with some useful insights into the meaning of state nonprofit corporation laws that give members a limited right to inspect corporate records. Consider the following:

The right of inspection is not absolute. It only exists if a church is incorporated under a state nonprofit corporation law that gives members such a right.
The right of inspection only extends to members.
The right of inspection only extends to those records specified in the statute creating the right.
Most such laws provide that the member may inspect documents "for a proper purpose" at a "reasonable time."
The court in this case concluded that a member had the legal authority to inspect church records even though the pastor claimed that the member's "fellowship" had been suspended by his failure to tithe or take the Lord's Supper.

The court examined the church's bylaws and found no provision addressing suspension of membership on the grounds cited by the pastor.

Watson v. Christie, 732 N.Y.S.2d 405 (2001).

Legal Developments

Church Records

A New York court ruled that a church member had the legal authority to inspect church records despite the pastor’s refusal to allow him to do so.

Richard R. Hammar, Attorney, CPA

Bio

State: New York
Categories: Church Records

A New York court ruled that a church member had the legal authority to inspect church records despite the pastor’s refusal to allow him to do so.

Most church leaders are not sure how to respond when a member asks to inspect church records. Do members have a legal right to have access to church records? If so, under what conditions? Are there exceptions? These are very relevant and important questions for which church leaders should have answers. A recent New York case addresses these issues and provides helpful guidance.

A church member asked for permission to inspect various church records. His request was denied on the ground that his membership had been suspended because of his failure to pay tithes and "take the Lord's Supper." The member sued, claiming that state nonprofit corporation law gave him a legal right to have access to the church's records. The New York nonprofit corporation law contains the following language regarding the inspection of records:

Except as otherwise provided herein, every corporation shall keep, at the office of the corporation, correct and complete books and records of account and minutes of the proceedings of its members, board and executive committee, if any, and shall keep at such office or at the office of its transfer agent or registrar in this state, a list or record containing the names and addresses of all members, the class or classes of membership or capital certificates and the number of capital certificates held by each and the dates when they respectively became the holders of record thereof. A corporation may keep its books and records of account in an office of the corporation without the state, as specified in its certificate of incorporation. Any of the foregoing books, minutes and records may be in written form or in any other form capable of being converted into written form within a reasonable time. Any person who shall have been a member of record of a corporation for at least six months immediately preceding his demand … upon at least five days written demand shall have the right to examine in person or by agent or attorney, during usual business hours, its minutes of the proceedings of its members and list or record of members and to make extracts therefrom.

A trial court ruled that the member had a legal right, on the basis of the nonprofit corporation law, to inspect church records from 1997 to the present. A state appeals court agreed. It acknowledged that only "members" had a legal right to inspect records, but it concluded that the member had not lost his status as a member of the church. It observed,

Although his "fellowship" may have been "suspended" by his failure to tithe and to take "the Lord's Supper," the bylaws of the church do not define either "fellowship" or the effect of suspension. Furthermore, the bylaws clearly set out a different criteria for expulsion of one's membership, which affords a member an opportunity to resign and a hearing, neither of which has occurred. In fact, it is uncontested that no process of expulsion has occurred. This is not a case where a member is seeking to force the church to perform some act against its will or seeking to define membership in a way opposed by the church. The member is simply trying to enforce his secular rights as a member, using the church's own criteria of membership and the pastor's own admission that he has not been expelled as a member. Nor are the church's first amendment rights violated by the inspection of the records, as the questions involved here are not concerned with internal ecclesiastical or religious issues, but purely secular ones.

The court also pointed out that the church board had voted to allow the member to inspect the church's records, and therefore it was doubtful that the pastor had the legal authority to contest this issue in court.

The court noted that state nonprofit corporation law only permits inspection for the prior fiscal year. However, it pointed out that the pastor had admitted that it was the church's policy to allow broader inspection to members. As a result, "the court properly recognized this policy by allowing inspection of the years 1997 to present."

What this means for churches:

The right of inspection is not absolute. It only exists if a church is incorporated under a state nonprofit corporation law that gives members such a right.
The right of inspection only extends to members.
The right of inspection only extends to those records specified in the statute creating the right.
Most such laws provide that the member may inspect documents "for a proper purpose" at a "reasonable time."
Members may lose the right to inspect church records if they are dismissed or suspended from membership pursuant to procedures specified in the church's bylaws or other governing document. However, as the court concluded in this case, members cannot lose their right to inspect church records by being "suspended" in a manner not authorized by the bylaws.
As this case illustrates, state nonprofit corporation law may limit the right of inspection to records created during the current or previous year. Be alert to any such limitation under your state's law.
Any decision to withhold documents from a member should be made with the advice of an attorney.

Watson v. The Manhattan Holy Bible Tabernacle, 732 N.Y.S.2d 405 (2001).

Legal Developments

Confidential and Privileged Communications

A New York court ruled that two rabbis could not be sued for breaching a “duty of confidentiality” as a result of their disclosure of confidential information shared with them by a counselee.

Richard R. Hammar, Attorney, CPA

Bio

State: New York

Lightman v. Flaum, 717 N.Y.S.2d 617 (2000)

Key point. The Clergy-Penitent Privilege Clergy can be liable for disclosing communications shared with them in confidence to others without the permission of the counselee.

A New York court ruled that two rabbis could not be sued for breaching a "duty of confidentiality" as a result of their disclosure of confidential information shared with them by a counselee since there was a third person present during the counseling sessions.

In 1995, a married woman (the "plaintiff") sought counseling from two different rabbis. She shared with each of them, in separate counseling sessions, information of an extremely personal and confidential nature. The rabbis were employed by congregations that the plaintiff and her husband attended. A few months later, the plaintiff sued her husband for divorce. She also asked the court to award her custody of the couple's four minor children. In response, the husband submitted affidavits in support of his claim to the custody of his children. These affidavits were prepared by the two rabbis, and they disclosed some of the confidential information that the plaintiff had shared with them during the counseling sessions. The affidavit of one of the rabbis stated:

[The plaintiff] admitted to me that she stopped engaging in our religious purification laws since September 1995 and hence, all sexual activity has stopped by her own decision. [She also] admitted to me that she was seeing a man in a social setting and admitted, "I am doing the wrong things." I spoke to her and counseled her against this.

The affidavit of the second rabbi stated:

[The plaintiff] admitted to me that she freely stopped her religious bathing so that, she did not have to engage in any sexual relations with [her husband]. She told me she was not getting fulfillment. When I inquired what that meant, she simply answered, he doesn't relate to me. Nothing was stated that amounted to cruel conduct by [the husband]. Her religious behavior has changed. She does not want to adhere to Jewish law despite the fact that she is an Orthodox Jew and her children are being raised Orthodox as well. She has engaged in bizarre behavior. I have no loyalty to either party except to state what I observed and to issue an opinion based on those observation from a religious point of view.

Based on these affidavits, the plaintiff sued both rabbis. Her primary claim was that the clergy-penitent privilege imposes a "fiduciary duty of confidentiality" upon clergy, and that this duty is breached when clergy disclose without authorization information that was shared with them in the course of a privileged conversation. In rejecting this claim, the court simply noted that "the plaintiff's mother or a friend were present" during her conversations with the rabbis, and therefore she "failed to show that the clergy-penitent privilege was not waived by the presence of a third person during her conversations with each of the rabbis." In view of this determination the court declined to determine "whether the plaintiff stated a cognizable claim for breach of fiduciary duty."

The plaintiff also claimed that the rabbis' unauthorized disclosure of confidential information she shared with them amounted to an intentional infliction of emotional distress. Once again, the court disagreed. It noted that "the facts alleged regarding the rabbis' conduct did not rise to a level which would satisfy the 'extreme and outrageous conduct' element of such a cause of action."

Application. This case represents one of the few discussions of clergy liability for divulging confidences. A lower court had ruled in 1999 that a "duty of confidentiality" exists with respect to information shared with clergy in the course of a conversation protected by the clergy-penitent privilege, and that clergy may be sued for breaching this duty of confidentiality if they disclose confidences shared with them during a privileged conversation.

The lower court concluded that it had insufficient information to determine if the duty of confidentiality arose in this case because it did not know if "third persons" were present when the plaintiff spoke with the rabbis. If third persons were present, then the clergy-penitent privilege would not apply because the conversations would not be confidential, and no duty of confidentiality arose.

The appeals court in this case responded directly to this open question by concluding that third persons in fact were present during the plaintiff's counseling sessions with the two rabbis, and therefore those conversations were not covered by the clergy-penitent privilege. Further, the court refused to address the question of whether a "duty of confidentiality" exists that is broken whenever a member of the clergy discloses confidential information obtained in the course of a privileged conversation.

In summary, the only two states that have found clergy liable for disclosing confidential information are California and Ohio (Snyder v. Evangelical Orthodox Church, 264 Cal. Rptr. 640 (Cal. App. 1989) and Alexander v. Culp, 705 N.E.2d 378 (Ohio App. 1993). Courts in other states may reach the same conclusion. Such cases are rare, and so few courts have been called upon to address the liability of clergy for unauthorized disclosure of confidential information.

While maintaining confidences is a moral duty for clergy, it also has been deemed to be a legal duty by lower courts in California and Ohio, and may be viewed as a legal duty by the courts of other states. On the other hand, the case addressed in the previous "recent development" demonstrates that some states will reject such a conclusion, at least to the extent it is founded on the clergy-penitent privilege.

Legal Developments

Church Records

A New York court ruled that members of a nonprofit corporation had a “proper purpose” in asking to see various records of the corporation.

Richard R. Hammar, Attorney, CPA

Bio

State: New York
Categories: Church Records

Key point 6-03.1. Church members generally have no right to inspect church records unless such a right is conferred by state nonprofit corporation law, a church's charter or bylaws, state securities law (if the church has issued securities), or a subpoena. Church records enjoy no privilege against disclosure, with the exception of documents that are protected by the clergy-penitent privilege under state law.

A New York court ruled that members of a nonprofit corporation had a "proper purpose" in asking to see various records of the corporation, and therefore they had a legal right under the state nonprofit corporation law to see those records.

A nonprofit corporation amended its articles of incorporation and bylaws to prevent "inactive members"' from voting on certain matters. Several inactive members informally asked to see the new corporate bylaws along with member lists and voting lists. When these requests were denied, the inactive members made a request to inspect the "books, minutes, and records" of the charity pursuant to the state Not-For-Profit Corporation Law. While the charity provided some records, it refused to provide several others on the ground that the members did not have a "proper purpose" for seeking them. The members appealed to a court for an order compelling inspection of the records. The court began its opinion by noting that

there is both a common law and statutory right by … members in a Not-For-Profit Corporation, to inspect the books and records of a corporation. However, inspection may be denied to a member who does not have a "proper purpose." To prove that their purpose is proper the statute requires members to supply affidavits to the corporation attesting that the information obtained through the inspection "will not be used for a purpose which is in the interest of a business or object other than the business of the corporation." Even then, the court has an obligation to look beyond the face of those affidavits to determine if there is bad faith on the part of the [members]. If the court finds that the application is not made in good faith and for proper purpose then the court may deny the petition.

The nonprofit organization insisted that the members' purpose was not "proper" because it was purely personal in nature. The members claimed that the "bad faith" and acts of alleged misconduct on the part of the organization's officers and directors justified their demand for inspection. The court noted that the fact that the members' interest "has a personal aspect to it does not preclude there being a legitimate corporate interest involved." It pointed out that members of nonprofit corporations "often have something personal to gain in their effort to call corporate policies into question," but concluded that this did not make their purpose any less legitimate.

The court provided the following additional clarification: "A proper purpose is one that is germane to the members' status in the corporation. This includes members' right to communicate with fellow members regarding amended bylaws, and the right to investigate management conduct."

With regard to the number of records that the members could inspect, the court noted that "the right to inspection would be wholly illusory if the corporation was permitted to decide which of its records members were allowed to see, and unduly burdensome if members were permitted to engage in a fishing expedition." The court then made the following additional conclusions:

(1) The charity refused to turn over some committee minutes on the ground that it was "unable to locate documents responsive" to this request. The court concluded that this answer was not a denial that the minutes ever existed, and "is not a satisfactory answer in a situation where the members are entitled to minutes that have been prepared by a committee, and therefore have become part of the corporate records. Given the import of the inspection statute, and the fact that the [charity] is accountable for its corporate records, at the very least it should disclose to the [members] whether or not such minutes ever existed. If in fact they exist then the committee minutes should be disclosed. If they once existed but cannot be found, that fact should be disclosed."

(2) The members claimed that the "minutes" provided to them of board meetings were "truncated" and "inaccurate." The court ordered the charity to provide the members with correct and complete minutes for the relevant meetings. However, the court cautioned that corporations are not required to "add" details that were not in the original minutes. "As long as the minutes bear the signature of the secretary of the meeting as evidence of their accuracy and completeness, I believe this satisfies the obligation" under the statute to turn over records.

What this means for churches

The right of church members to inspect church records is an important question. This case provides the following clarifications:

1. Most state nonprofit corporation laws give members a legal right to inspect specified corporate books and records at a reasonable time and for a "proper purpose." This court also recognized that members of nonprofit corporations have a "common law right" to inspect corporate records, meaning that the right exists whether or not granted by the applicable nonprofit corporation law. This is perhaps the first time that a court has reached this conclusion.

2. The court provided a broad interpretation of a "proper purpose." The definition of this term is critical, since it will determine whether or not members have a legal right to inspect specified documents. The court concluded that a request to inspect corporate documents that is based on members' desire to investigate and correct alleged misconduct by officers and directors is a proper purpose. It also concluded that a purpose may be proper even though it serves some personal interest of the member or members requesting the documents. The court provided a useful definition of a proper purpose as one that is "germane to the members' status in the corporation" including the right to "communicate with fellow members regarding amended bylaws and the right to investigate management conduct."

3. The court was unwilling to let the charity respond to document requests by providing summaries of the requested documents. On the other hand, it noted that a charity need not "expand" or provide additional details to committee and board minutes that were not in the original minutes. "As long as the minutes bear the signature of the secretary of the meeting as evidence of their accuracy and completeness, this satisfies the obligation" under the statute to turn over records. Many church board minutes are very abbreviated. This case suggests that a request by members to see those minutes will not require the church to provide detail that was not in the original minutes.

Wells v. League of American Theatres, 706 N.Y.S.2d 599 (Sup. Ct. 2000).

Legal Developments

Recent Developments in New York Regarding Personal Injuries on Church Property or During Church Activities – Part 1

A New York court ruled that a church was not legally responsible for injuries sustained by a member who slipped on a puddle of water in a church hallway near a water fountain.

Richard R. Hammar, Attorney, CPA

Bio

State: New York

Church Law and Tax1999-11-01

Personal Injuries-On Church Property or During Church Activities

Richard R. Hammar, J.D., LL.M., CPA

• Key point. Churches generally are not liable for accidents that occur on their property unless church leaders were actually aware of the condition that caused the accident and failed to correct it, or the condition had existed for so long that church leaders are presumed to have been aware of it.

A New York court ruled that a church was not legally responsible for injuries sustained by a member who slipped on a puddle of water in a church hallway near a water fountain. The member acknowledged that the church would be legally responsible only if the risk of slipping on water in the hallway was a reasonably foreseeable hazard. However, she insisted that this hazard was foreseeable because the church had placed a stool under the water fountain to allow children to access it. She alleged that it is common knowledge that children who use water fountains cause spills and puddles on the surrounding floor. As a result, the risk of an adult slipping on a puddle of water near the water fountain was foreseeable. The court disagreed. It concluded,

[T]o hold that [the church] created a reasonably foreseeable hazard by providing an unsecured step stool for children to access a hallway water fountain would be to stretch the concept of foreseeability beyond acceptable limits. Certainly there is no evidence that [the church] had actual notice of the water that had spilled in front of the fountain, or that the water was present for a sufficient length of time before the accident to permit [church] employees to discover and remedy it, or that [it] had actual knowledge of any prior spillage of water in front of the fountain, or that spillage was an ongoing and recurring condition that was routinely left unaddressed. Nor is an issue of fact as to [the church’s] notice of a recurring condition raised by [the victim’s] unsupported assertion that it is common knowledge that children are careless and that water will splash from fountains. A mere general awareness that some dangerous condition may be present is legally insufficient to constitute notice of a particular condition.

Application. What about the water fountains in your church? Do you have a stool or other device that allows young children to access one or more water fountains? If so, this case suggests that you will not necessarily be liable for injuries that occur to adults who slip on puddles around such water fountains. However, the court mentioned three important exceptions to this rule. A church may be liable for these accidents if (1) it has actual knowledge of a puddle and does not remove it within a reasonable time, or (2) it has no actual knowledge of a puddle, but the puddle was present for a sufficient amount of time to put church leaders “on notice” of the condition, or (3) puddles are a “recurring problem” around a water fountain. Chaney v. Abyssinian Baptist Church, 667 N.Y.S.2d 737 (A.D. 1998). [Premises Liability]

© Copyright 1999 by Church Law & Tax Report. All rights reserved. This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is provided with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. Church Law & Tax Report, PO Box 1098, Matthews, NC 28106. Reference Code: m58 m86 c0699

Legal Developments

Recent Developments in New York Regarding Personal Injuries on Church Property or During Church Activities – Part- 2

A New York court ruled that a church might be legally responsible for injuries occurring during the activities of a Boy Scout troop sponsored by the church.

Richard R. Hammar, Attorney, CPA

Bio

State: New York

Church Law and Tax1999-11-01

Personal Injuries-On Church Property or During Church Activities

Richard R. Hammar, J.D., LL.M., CPA

• Key point.Churches may be legally responsible for injuries occurring during activities conducted by scouting and other outside youth-serving organizations that are sponsored by the church.

A New York court ruled that a church might be legally responsible for injuries occurring during the activities of a Boy Scout troop sponsored by the church. An 11-year-old boy was a member of a Boy Scout troop sponsored by a local church. He was injured while sledding on a Boy Scout camping trip to a camp that was owned by a regional Boy Scouts organization. The victim’s parents sued the scoutmaster in charge of the trip, the national and regional Boy Scouts organizations, and the sponsoring church. The parents claimed that the negligence of the scoutmaster in permitting the troop to go sledding in a prohibited area resulted in their son’s injuries, and that the Boy Scouts organizations and the church were liable for the negligent acts of the scoutmaster based on the doctrine of respondeat superior. Under the respondeat superior doctrine, an organization is legally responsible for the negligent acts of its agents and employees committed within the course of their assigned duties and responsibilities. The court dismissed the national and regional Boy Scouts organizations from the lawsuit, noting that there was no evidence that they had “supervision or control over the activities of the scoutmaster or the troop.” However, the court refused to dismiss the church from the lawsuit, since the church “failed to establish as a matter of law that it did not have the ability to control the scoutmaster at the time of the accident.”

Application. This case illustrates the risk churches face in sponsoring scouts or other youth-serving organizations. If a child is injured while participating in an activity conducted by the organization, the church may be liable if it had the ability to control the leaders of the event or activity. The concept of “control” is very broad, and so this is a risk that church leaders should take seriously. This risk can be reduced through a number of precautions, including but not limited to the following: (1) do not sponsor a youth-serving organization without written assurance that they use reasonable care in the selection of adult workers; (2) do not sponsor a youth-serving organization without written assurance that they use an adequate number of adult volunteers (you can obtain suggested staffing levels by calling other local charities); (3) do not sponsor a youth-serving organization without written assurance that they employ a “two adult” rule, meaning that no adult is ever permitted to be alone with one child; (4) do not sponsor a youth-serving organization without proof of adequate liability insurance (you can discuss the adequacy of insurance with your own insurance agent); (5) be sure your insurance policy provides coverage in the event of an injury; (6) enter into an agreement with the organization setting forth the nature of the relationship and specifically disclaiming, if appropriate, any authority to control workers, children, or activities. Alessi v. Boy Scouts of America, 668 N.Y.S.2d 838 (A.D. 1998). [Negligence as a Basis for Liability]