Ministerial Exception Prevents Court from Resolving Employment Dispute

Key point 8-10.1. The civil courts have consistently ruled that the First Amendment prevents the

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State: Wisconsin
Categories: Clergy - Removal, Employment Practices

Key point 8-10.1. The civil courts have consistently ruled that the First Amendment prevents the civil courts from applying employment laws to the relationship between a church and a minister.

The Wisconsin Supreme Court ruled that it was barred by the "ministerial exception" from resolving an employment dispute between a church and its Director of Faith Formation. A church entered into a written, one-year employment contract with a woman (the "plaintiff") who served as its Director of Faith Formation. The contract described the plaintiff's duties, the annual salary and fringe benefits to which she would be entitled, the term of the contract, the facilities to which she would have access as Director of Faith Formation, and the procedures for employee evaluation and annual contract renewal. Additionally, the contract included provisions governing termination of the employment relationship. The contract provided:

The PARISH agrees that the DIRECTOR OF FAITH FORMATION shall not be discharged during the term of this contract, without good and sufficient cause, which shall be determined by the PARISH. The PARISH agrees that the Pastor of the PARISH will be responsible for giving the employee notice of any dissatisfaction with service or conduct. Dismissal may be immediate or within a time frame determined by the PARISH.

The church terminated the plaintiff's employment. It was undisputed that the plaintiff had been compensated for all services performed under the contract, and that she was a "ministerial employee" whose work was fundamentally tied to the church's religious mission.

The plaintiff sued the church, claiming it breached her employment contract by terminating her "without good and sufficient cause" as that term was defined by the contract. She sought monetary damages of $35,000, representing the salary she would have received but for her termination.

The church asked the court to dismiss the plaintiff's lawsuit on the basis of the "ministerial exception" which generally bars the civil courts from applying employment discrimination laws to hiring and firing decisions by churches involving clergy. A trial court agreed with the church and dismissed the plaintiff's claims. On appeal, the state supreme court affirmed the trial court's dismissal of the plaintiff's claims:

[The plaintiff] seeks state court enforcement of a provision in a private contract in order to invalidate a church's reason for terminating her employment. However, the First Amendment grants religious institutions "independence from secular control or manipulation—in short, power to decide for themselves, free from state interference, matters of church government as well as those of faith and doctrine" (quoting the United States Supreme Court's decision in Kedroff v. Saint Nicholas Cathedral of the Russian Orthodox Church, 344 U.S. 94 (1952). Therefore, the plaintiff asks the state courts to engage in activity that the Constitution prohibits … .

It has been universally recognized that the First Amendment protects religious institutions' decisions about whom to hire as ministerial employees and when to terminate their employment. Accordingly, a terminated ministerial employee's complaint alleging that her religious institution employer terminated her for an improper reason is not viewed through the lens that we usually apply when examining the legal sufficiency of a complaint. Rather, the allegations in the complaint are viewed in the context of the First Amendment's proscriptions against state interference with religious institutions' choices of who shall be the voice of their faith … .

When a ministerial employee is terminated, the religious institution's decision about who shall teach its faith and how that shall be done are intertwined with the decision to terminate the employee. Courts can have no role in affirming or overturning such a decision based on the reason why the religious institution terminated the employment.

The court quoted from the United States Supreme Court's 2012 decision unanimously affirming the ministerial exception: "Requiring a church to accept or retain an unwanted minister, or punishing a church for failing to do so, intrudes upon more than a mere employment decision. Such action interferes with the internal governance of the church, depriving the church of control over the selection of those who will personify its beliefs." Hosanna-Tabor Evangelical Lutheran Church and School v. E.E.O.C., 132 S.Ct. 694 (2012).

The Wisconsin court concluded:

The First Amendment grants [a church] free choice in deciding that a ministerial employee should be terminated because it is that type of employee who will preach [religious institutions'] beliefs, teach their faith, and carry out their mission. As the Supreme Court has explained, when a ministerial employee sues her religious employer to contest the validity of the reason for which she was fired, "the First Amendment has struck the balance for us. The church must be free to choose those who will guide it on its way … ."

Stated otherwise, if [the plaintiff's] claim is not dismissed, a court will be required to decide whether [the church] terminated her without "good and sufficient cause," within the meaning of those terms in the contract … . Furthermore, if a court were to award damages [to the plaintiff] the church would be required, by the state, to pay for its decision to terminate an unwanted ministerial employee. This, the First Amendment does not permit. As the United States Supreme Court has said, "an award of such relief would operate as a penalty on the church for terminating an unwanted minister, and would be no less prohibited by the First Amendment than an order overturning the termination."

What This Means For Churches:

This case is important because it extends the breadth of the ministerial exception to include breach of contract claims. The Supreme Court's ruling in the Hosanna-Tabor case in which it unanimously affirmed the ministerial exception involved the application of an employment discrimination law to clergy. The Wisconsin Supreme Court, like many other courts, have reached the logical conclusion that the reasoning supporting the application of the ministerial exception in the context of employment discrimination laws is equally applicable to other employment disputes involving churches and their ministers. DeBruin v. St. Patrick Congregation, 816 N.W.2d 878 (Wis. 2012).

Legal Developments

Petroleum Contamination of Church Property

Court rejects church’s injunction against neighboring gas station.

Richard R. Hammar, Attorney, CPA

Bio

State: Wisconsin
Categories: Church Property

Church Law & Tax Report

Petroleum Contamination of Church Property

Court rejects church’s injunction against neighboring gas station.

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

Key point. Most cities have enacted building codes that prescribe minimum standards in the construction of buildings. The courts have ruled that these laws may be applied to churches so long as they are reasonably related to the promotion of public health and safety.

A federal court in Wisconsin ruled that a church was not entitled to a restraining order barring further contamination of its property by an adjacent property that for many years had been used as a gas station. A gas station was opened in 1955. The station had a history of gasoline spills including a significant petroleum spill which occurred in 1983. In 1996 the Wisconsin Department of Natural Resources issued the owner a letter demanding that it address the spills. The owner hired an engineering company that remediated the property to a level approved by the state.

In 2001, a church purchased property adjacent to the gas station. It was not aware that the property was contaminated from the gasoline spills which had occurred next door and had migrated to its property. The church also was not aware that the previous owner of its property discovered gasoline in the basement sump or that vapors had intruded into the building’s basement where the church eventually located its school classrooms.

In 2006 another gasoline spill occurred on the adjacent property and migrated to the church. This spill migrated into footing drain tiles and the basement sump, and resulted in gasoline odors that caused some teachers and students to complain of headaches, dizziness, and nausea. Some people also were coughing. The next day, the state declared the church’s property to be uninhabitable, set up an emergency venting system, and ordered the electricity be shut off to avoid an explosion.

The church hired an emergency response contractor to excavate contaminated soil and install a blower to address vapors from contamination that could not be removed. Thereafter the state determined that the building was safe and allowed the church to reoccupy and use its building.

The church filed a motion for a preliminary injunction in a local court pursuant to the federal Resource Conservation and Recovery Act (RCRA) in which it sought an order requiring the adjacent property owner “to take specific investigatory and remedial steps to protect the children, teachers, staff, church members, and employees who use our building from the gasoline saturated soils and ‘free product’ beneath our building and the gasoline vapors which are emanating from our basement.” The church asserted that an injunction was necessary because its neighbor had not taken the necessary steps to protect pupils, teachers, and parents who utilize its basement school from the imminent hazard to human health created by the gasoline spills.

RCRA is a comprehensive statute governing the treatment, storage and disposal of hazardous waste. Its primary purpose is to limit the harmful effects of hazardous waste “to minimize the present and future threat to human health and the environment.” A citizen may bring suit under RCRA “against any person, including … any past or present generator … who has contributed or who is contributing to the past or present handling … of any solid or hazardous waste which may present an imminent and substantial endangerment to health or the environment.” RCRA bars any monetary damages, and limits relief to injunctions.

RCRA permits a private party to bring suit only upon a showing that the solid or hazardous waste at issue “may present an imminent and substantial endangerment to health or environment.” With respect to this restriction, the Supreme Court has concluded that: “The meaning of this timing restriction is plain: An endangerment can only be imminent if it threatens to occur immediately, and the reference to waste which may present imminent harm quite clearly excludes waste that no longer presents such a danger.”

The court rejected the church’s request for an injunction on the ground that there was insufficient evidence of an “imminent and substantial endangerment to health.” It concluded:

On May 1, 2006, the state determined that the building was safe and the church was allowed to reoccupy and use its building. Since May 1, 2006, the church has been using the basement of the building without interruption. Nevertheless, it asserts that gasoline vapors are present in the building endangering its occupants. The vapors, according to the church, may be at concentrations below the odor threshold, but are at concentrations that are harmful to children.

The state conducted passive dosimeter sampling in the building in November 2006. In a December 14, 2006 letter to the pastor, it stated that it “did not find an indoor air problem of health concern” at the building. Although benzene was detected in the church on the first floor at a level below the lab’s ability to quantify, it was not detected in either the sump closet or the computer lab, both of which are located in the basement. Additionally, “the levels of [other] contaminants that were detected in the air via the sampling by the health department were extremely low or not detected.”

In further support of its decision, the court noted that “although there is evidence that gasoline vapors exist under the church building, there is no evidence that the compounds under the concrete slab of the building are migrating into the basement air.”

It referred to a chemical analysis of samples collected from under the basement slab and the air data taken in the building by the state which showed that the vapors under the slab did not match chemicals found in the basement air and therefore were not migrating into the building. Therefore, an “exposure pathway” from the adjacent property to the church basement did not exist.

The court also pointed out that the levels of benzene in the air of the church building were comparable to background levels of benzene in the community, and that some of the compounds that were identified in the air were those also found in materials other than gasoline, such as glass cleaner, floor cleaners, polishes, varnish, paint, and nail polish.

The court concluded: “In sum, based on the evidence presented, the church has not established that there is a complete exposure pathway from any gasoline vapors in the sub-slab under the basement …. The church has not shown that gasoline vapors are present in its building creating ‘an imminent and substantial endangerment to health or environment.’ Therefore, the church’s motion for a preliminary injunction will be denied.” KJG Investments Inc., 2009 WL 2460990 (E.D. Wis. 2009).

This Recent Development first appeared in Church Law & Tax Report, November/December 2010.

Legal Developments

Reporting Sexual Misconduct to Future Employers

Churches are not generally required to warn future employers of an individual’s sexual misconduct.

Richard R. Hammar, Attorney, CPA

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State: Wisconsin
Categories: Denominations - Legal Liability, Sexual Misconduct by Clergy, Lay Employees, and Volunteers

Key Point 8-24. A reference letter is a letter that evaluates the qualifications and suitability of a person for a particular position. Churches, like other employers, often use reference letters to screen new employees and volunteers. Churches often are asked to provide reference letters on current or former workers. The law generally provides employers with important protections when responding to a reference letter request. However, liability may still arise in some cases, such as if the employer acts with malice in drafting a reference letter.

The Wisconsin Supreme Court unanimously ruled that a church does not have an affirmative duty to warn future employers that one of its ministers had molested several boys. Five adult males (the "plaintiffs") alleged that they were sexually abused by a priest from 1968 to 1973 when he was employed as a teacher by a parochial school in Kentucky.

The plaintiff's lawsuit described an ongoing pattern of sexual abuse of children by the priest over the years. The plaintiffs allege that prior to 1964, he had engaged in inappropriate sexual conduct while at a Catholic seminary; that between 1964 and 1966, he abused more than two dozen children while a teacher at a Wisconsin parochial school; that he subsequently admitted to sexually abusing up to ten more children at another Wisconsin parochial school; and that the pattern of sexual abuse continued while he was a teacher at the parochial school in Kentucky. The plaintiffs sued the Wisconsin diocese (the "Diocese"), claiming that it "knew or should have known of the priest's propensity for sexually abusing children and, despite this knowledge, did not refer him to the police or take any other action to prevent him from continuing his pattern of sexually abusing children." The lawsuit further alleged that the failure of the diocese to refer the priest to the police or to take "other action to prevent a continuation of his pattern of sexually abusing children" amounted to negligence, and that the diocese's negligent conduct was a substantial factor in causing the priest's sexual abuse of and resulting injuries to the plaintiffs. The plaintiffs specified that such negligence in failing to take other action specifically included a negligent failure to warn "unforeseeable third parties," including "other dioceses within the United States, the parochial school systems or the parents of unforeseeable victims" of the priest's propensity for sexual abuse.

The court noted that the plaintiffs' negligence claim "is premised on an alleged failure to warn unforeseeable third parties, including any potential future employers of the priest at dioceses and parochial school systems everywhere in the country, as well as parents of unforeseeable victims."

The Diocese insisted that the law does not "impose a duty on employers to seek out and disclose information to an employee's subsequent employers or the public at large concerning a former employee's history of misconduct or antisocial behavior," and that under the legal theory of negligent referral or duty to warn "unless an employer gives a favorable reference to a subsequent employer or third party about the former employee while withholding negative information, there is no breach of duty established by the employer's failure to seek out subsequent employers and alert them to prior negative history of the former employee."

The supreme court concluded:
The Diocese's mere knowledge of the priest's past sexual abuse, or a presumed knowledge of a continued sexual propensity for abuse, is not enough to establish negligence. Reasonable and ordinary care does not require the Diocese to notify all potential subsequent employers within dioceses and parochial school systems across the country, along with all parents of future unforeseeable victims. Requiring such notification under these circumstances would create a vast obligation dramatically exceeding any approach to failure to warn recognized either in this state or in other jurisdictions ….

More importantly, in this case, the specific victims were unforeseeable. Foreseeability of specific victims becomes relevant when an affirmative obligation is argued, such as the obligation to warn. Moreover, the Diocese did not assume a special role in regard to the injured parties ….

The plaintiffs in this case had virtually no relationship with the Diocese. There are significant gaps temporally and geographically, with the plaintiffs separated from the Diocese by several state lines and their abuse separated from the priest's employment with the Diocese by a number of years, and the complaint never indicated that their paths crossed at all prior to the plaintiffs filing this action. Thus, the relationship between the parties in this case is quite attenuated.

There is no state in which employers are recognized as being negligent for failing to seek out, find, and warn future employers of sexually dangerous former employees. Even those states that have recognized a negligent referral doctrine do not impose liability when a referral letter is sent by a past employer to a future employer of such an employee unless actual misrepresentations are made in such a letter. See Randi W., 929 P.2d at 584 [fully addressed in section 8-24 of Richard Hammar's Pastor, Church & Law (4th ed. 2008)].

Thus, we conclude that the plaintiffs' complaint fails to allege negligence sufficiently to survive a motion to dismiss. Although the plaintiffs allege that the Diocese knew that the priest had a propensity for sexual abuse, what is more pertinent is what the plaintiffs did not allege. They did not allege that the Diocese knew that he was in Kentucky, still teaching children, or working for the Archdiocese in Louisville. They did not allege any knowledge that the children at the [parochial school in Kentucky] were in any danger. They did not allege that the Archdiocese of Louisville asked the Diocese for a reference, that the Diocese made a reference recommending the priest, or that the Diocese had any communication whatsoever with the Archdiocese of Louisville regarding the priest.

The plaintiffs also fail to provide legal authority supporting their arguments. They argue that the duty of ordinary care in this case encompasses a specific obligation to warn all parochial schools and dioceses in this country, as well as future parents of unforeseeable victims, but have cited no cases in which the failure to warn third parties has been described in such sweeping terms ….

We decline to rule that under the general duty of ordinary care recognized in Wisconsin, an employer may be found negligent for failing to warn unforeseen third parties of a dangerous former employee. Such a ruling would extend an employer's obligation to warn indefinitely into the future to a sweeping category of persons, thereby requiring employers to warn nearly all potential future employers or victims, as the plaintiffs in this case argue. … A decision to the contrary would create precedent suggesting that employers have an obligation to search out and disclose to all potential subsequent employers, which could include in an employment context every school in the country or beyond, all matters concerning an ex-employee's history …. The primary public policy problem with recognizing the claim as presented by the plaintiffs is that there is no sensible stopping point to recognizing negligence claims for such an open-ended and ill-defined sweeping claim. Recognizing the plaintiffs' claim against the Diocese in this case could result in requiring all employers to warn all unforeseen potential future employers of any number of problems related to any number of past employees. It could further result in all parents who become aware that their child was sexually abused then facing potential liability for not warning every other parent who might also have children at risk of being in contact with the perpetrator.

Application. This case is significant because it addresses the fundamental question of a church's duty to affirmatively warn future employers and potential victims of a former employee's propensity to engage in sexual or other misconduct. The relevance of the case is augmented by the fact that (1) it was a ruling by the Wisconsin Supreme Court; (2) it was a unanimous ruling; and (3) it represents the most extended discussion of this issue in any case involving a religious organization.

Note that the court suggested that its ruling might not relieve churches from liability for providing positive, unqualified references on former employees who committed sexual or other misconduct, or for failing to warn other churches where it knows such former employees are working. But, there is no affirmative duty to track former employees in order to give notice to all future employers and potential victims of the risk they face. It should also be noted that churches may face civil liability on the basis of "interference with contract" for gratuitously warning future employers of a former employee's previous misconduct if a reference was not requested and results in the employee's dismissal. Hornback v. Archdiocese of Milwaukee, 752 N.W.2d 862 (Wis. 2008).

This Recent Development first appeared in Church Law & Tax Report, July/August 2009.

Legal Developments

Are Parochial School Teachers Ministers?

Court rules that ministerial exception does not apply to teacher in Catholic school.

Richard R. Hammar, Attorney, CPA

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State: Wisconsin
Categories: Employment Practices

Church Law & Tax Report

Are Parochial School Teachers Ministers?

Court rules that ministerial exception does not apply to teacher in Catholic school.

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

Key point. Some courts have not recognized the ministerial exception, usually because the complainant was not a minister in either status or function, or was employed by a secular organization.

A Wisconsin court ruled that the so-called “ministerial exception,” which generally bars the civil courts from resolving employment disputes between churches and clergy, did not apply to a first grade teacher in a Catholic parochial school. A woman (the “plaintiff”) was employed as a first-grade teacher at a parochial school from 1974 until 2002. In 2002, when the plaintiff was 53 years old, the school informed her that her employment contract would not be extended for the next year. The plaintiff filed a complaint with a civil rights agency, claiming age discrimination under a state fair employment law. The school asked the agency to dismiss the complaint on the ground that it was barred by the ministerial exception since the plaintiff’s position was ministerial in nature and therefore any resolution of her complaint would violate the First Amendment guaranty of religious freedom. The agency concluded that the ministerial exception did not apply, and a trial court agreed. The school appealed.

A state appeals court ruled that the ministerial exception did not apply in this case, for the following reasons:

First, the court concluded that teaching positions in church schools are not necessarily ministerial in nature, and that “a general exemption for teachers in religious schools would be more expansive than warranted when considered in light of the magnitude of the state’s interest in the enforcement of antidiscrimination laws.”

Second, the court noted that the principal test for deciding whether a particular position is ministerial in nature is whether the person’s “primary duties consist of teaching, spreading the faith, church governance, supervision of a religious order, or supervision or participation in religious ritual and worship.” The court concluded that “a religious teacher’s duty to model and support particular religious values is not in itself one of the duties included in the primary duties test: it does not constitute teaching or spreading the faith ….” The court added: “We do not question the dedication of teachers in religious schools to fulfilling this role. However, the duties in the [test] are intended to distinguish, from other employees of churches or religious organizations, those persons whose relationship to the church or organization is such that employment decisions regarding them will likely involve ecclesiastical decisions or matters of church government, faith and doctrine. Modeling and supporting religious values does not provide a distinction that serves this purpose.”

Third, “even if in some cases the teaching of secular subjects might be so infused with religious doctrine that it would constitute the teaching of the faith, we are persuaded that is not the case here.” The court noted that the textbooks used by the school were non-religious, and that the plaintiff was not engaged in “teaching the faith within the meaning of the primary duties [test].”

Fourth, the duties included within the primary duties test were not the plaintiff’s primary duties. The religion class, prayers, and participation with her students in liturgies “do not constitute the primary part of her work day and they are not the primary focus either of the job description or the job evaluation.”

Fifth, “not applying the ministerial exception in this case is consistent with the fundamental purpose of the exception.” Because the plaintiff’s primary duties “do not implicate matters of church faith and doctrine, the prospect that employment decisions will implicate those matters is significantly diminished. This, in turn, affects the balance between the free exercise right and the important policies underlying [state law]. We are persuaded that a bar to adjudication of the plaintiff’s discrimination claim is not warranted based on the nature of her position.”

The court cautioned: “Our conclusion that the plaintiff’s position is not ministerial does not mean that [the school] would have no First Amendment protection if an employment decision concerning her did implicate a matter of church faith or doctrine.” Coulee Catholic Schools v. Labor and Industry Review Commission, 752 N.W.2d 341 (Wisc. 2008).

This Recent Development first appeared in Church Law & Tax Report, March/April 2009.

Legal Developments

State Laws for Charitable Contributions

State laws prohibiting state employees from making charitable contributions through payroll deduction to religious organizations violates the First Amendment.

Richard R. Hammar, Attorney, CPA

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State: Wisconsin
Categories: Charitable Contributions

Church Law & Tax Report

State Laws for Charitable Contributions

State laws prohibiting state employees from making charitable contributions through payroll deduction to religious organizations violates the First Amendment.

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

Key point. State laws prohibiting state employees from making charitable contributions through payroll deduction to religious organizations violates the First Amendment guaranty of association.

* A federal district court in Wisconsin ruled that a state law allowing state employees to make charitable contributions through salary deductions to several charities except churches that required their board members to agree with their doctrinal beliefs was unconstitutional. The Wisconsin State Employees Combined Campaign (SECC) is a program through which state employees may make voluntary contributions to listed charitable organizations through payroll deduction. A state regulation limits eligible charities to those that do not discriminate on the basis of religion (or several other factors) with respect to employees or board members. The state interpreted this regulation to prevent religious organizations from participating in the SECC if their board members were required to share the doctrinal beliefs of the organization. Several religious organizations sued the state, claiming that the regulation violated the First Amendment guarantees of free speech, freedom of religion, and freedom of association. The court agreed:

Wisconsin does not espouse a policy against discrimination by religious groups in choosing members of their faith as directors and employees, and has affirmatively supported such rights. Such discrimination is, of course, fundamental to the nature of religious organizations and their right of expressive association. The Wisconsin Fair Employment Act expressly permits a nonprofit religious organization to discriminate in its hiring in favor of employees of the same denomination and beliefs …. The articles of incorporation of a religious organization may specify that officers and trustees must be communicants of the faith of its affiliated church …. Wisconsin’s public policy as embodied in its statutes unequivocally supports the right of religious organizations to control their internal governance and hire employees who share the organization’s religious beliefs. Excluding religious charities from the SECC appears as a single stark exception to a consistent state policy …. The claim that excluding religious charities from the SECC is dictated by a larger state policy disfavoring discrimination in the governing boards and staff of religious organizations is simply unsupported.

The court also rejected the state’s argument that allowing religious organizations to be approved charities under the SECC program would diminish the amount of contributions going to other charities.

The court noted that the charitable campaign for federal employees does not exclude religious entities from participation, and there is no evidence that other charities have suffered as a result. Association of Faith-Based Organizations v. Bablitch, 454 F.Supp.2d 812 (W.D. Wis. 2006).

Legal Developments

Child Abuse Reporting

The Wisconsin Supreme Court ruled that a school principal who disclosed to an alleged child abuser the identities of the school employees who reported the abuse could be prosecuted.

Richard R. Hammar, Attorney, CPA

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State: Wisconsin
Categories: Child Abuse, Child Abuse Reporting

• Key point. Persons who disclose the identities of those who report child abuse may be subject to criminal prosecution under the confidentiality provisions of the child abuse reporting laws of some states.

* The Wisconsin Supreme Court ruled that a school principal who disclosed to an alleged child abuser the identities of the school employees who reported the abuse could be prosecuted for violating the state child abuse reporting law's prohibition on the disclosure of the identities of reporters. A teacher noticed a mark on a child's forehead, and suspected it was the result of child abuse. The teacher removed the student from the classroom and took him to another teacher for evaluation. The teachers concluded that it was possible that the child had been abused, and they reported the abuse to civil authorities. A social worker arrived a short time later, spoke with the student, and determined that abuse was unlikely. The child's parents learned of the incident and were very upset at how it was handled. They met with their child's teacher, the school principal, and the superintendent of schools. The superintendent of schools later wrote the parents a letter in which he disclosed the identity of the two teachers who noticed and reported the suspected abuse. The superintendent was later charged with violating a state law prohibiting the disclosure of the identities of persons who report suspected child abuse. The statute specifies, "All reports made under this section … shall be confidential. Reports and records may be disclosed only to [the child's parents] …. Any person who violates this section … may be fined not more than $1,000 or imprisoned not more than 6 months or both."

The state supreme court ruled that the word "disclose" requires that the persons to whom the identity of a child abuse reporter is communicated must have been unaware of the reporter's identity at the time of the disclosure, and therefore the state has the burden of proving this beyond a reasonable doubt. However, the court rejected the superintendent's argument that he could not be guilty of violating the statute because he did not "intend" to disclose confidential information. The court concluded that the statute did not require a specific intent, and therefore the superintendent could be convicted for simply disclosing reporters' identities without any proof of intent. It concluded, "Here, the legislature, by establishing a confidentiality requirement, was clearly attempting to impose a high standard of care on those with access to records and reports of child abuse and neglect. In such a case, it is not unfathomable that the legislature would eliminate a mental state to enforce such a standard."

Application. The relevance of this case to church leaders is apparent. In many states, pastors are mandatory reporters of child abuse (see the May-June 2003 issue of Richard Hammar's Church Law & Tax Report newsletter for a review of the child abuse reporting laws of all 50 states). In many cases, church employees or volunteers share their suspicions of child abuse with the pastor who then may or may not report the allegations to the state. Pastors who report abuse that is disclosed to them by staff members, and who later reveal the identity of the "reporter" to the alleged offender, may be subject to criminal penalties. This is an important point for pastors to consider before disclosing the identity of a child abuse reporter to the person accused of abuse. State v. Polashek, 646 N.W.2d 330 (Wisc. 2002).

© Copyright 2003 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: m10 c0403

Legal Developments

Employment Practices

A federal court in Wisconsin ruled that it was barred from resolving a former church music director’s claim that she had been wrongfully terminated by the church on account of her race.

Richard R. Hammar, Attorney, CPA

Bio

State: Wisconsin

Miller v. Bay View United Methodist Church, 141 F.Supp.2d 1174 (E.D. Wis. 2001)

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. 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.

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.

The Civil Rights Act of 1964

A federal court in Wisconsin ruled that it was barred by the first amendment guaranty of religious freedom from resolving a former church music director's claim that she had been wrongfully terminated by the church on account of her race in violation of federal law.

A Methodist church had a staff-parish relations committee, comprised of nine congregational members who volunteer for three-year terms, that made all employment decisions on behalf of the church by majority vote of the members. It and other committees that run the day-to-day operations of the church report to the "administrative council," which is the church's main governing body. The administrative council oversees all aspects of the church's operations.

The church's congregation consists of approximately 500 members. Although members organize and attend a variety of community activities at the church, the main gathering of the congregation are two weekly worship services on Sunday mornings. The structure and order of the worship services are determined by the pastor who is responsible for coordinating the elements of scripture, music, word, and prayer into a meaningful spiritual experience for the congregation.

The church has two choirs, the Chancel Choir and the Contemporary Christian Choir. The choirs were formed to participate in the Sunday worship services and participation in the choirs was completely voluntary. In 1997 the church hired a woman ("Leela") as its choir director and music director for its Sunday worship services. Leela was a member of another local church, and described herself as a "religious" and "spiritual" person. Prior to being hired, Leela went through an interview process with a special selection committee consisting of three members of the Chancel Choir. The selection committee was charged with the task of interviewing applicants and forwarding recommendations to the staff-parish relations committee, which made the ultimate decision to hire Leela.

During Leela's interview with the selection committee, she was told her basic job responsibilities were to choose appropriate musical selections for the Sunday worship services and to prepare and direct the choirs in leading the congregation in song. Additionally, the committee members explained to her that she was expected to research the religious themes of the upcoming services in religious books in the church's music library and to select music that coincided with the religious themes and meanings of that particular service. The selection committee informed her that she was expected to select the music for a particular service at least three weeks in advance to allow time for the choirs to practice the music for the worship service.

The selection committee also provided the plaintiff with copies of job descriptions for the positions of Chancel Choir Director and Director of Music at the time of her interview. The printed job description for Chancel Choir Director contains a section entitled "Responsibilities and Expectations." Such responsibilities and expectations include: "Conduct and lead weekly rehearsals," "Conduct and lead choir in anthems, weekly at the second service," "Prepare Choir to lead congregation in Hymns," "Select and prepare music well in advance of presentation," and "Where possible music to fit the liturgy and or the lectionary," and "Purchase music with the established budget."

The "Policy" section of the Chancel Choir Director job description states that Music in Worship rests upon the following "music ministry keys:" (1) variety is essential, (2) quality expected, (3) ministry, not performance, and (4) members are more important than gorgeous music. The "Policy" section of the director of music job description has the same "Music in Worship" elements, except in reference to the Contemporary Christian Choir. The "Responsibilities and Expectations" for Director of Music also states that the Music Director was to "encourage and promote music ministry outreach."

Following her interview with the selection committee, Leela interviewed with members of the two choirs she was to direct. The selection committee determined after the interview that Leela's qualifications seemed to fit the church's needs for a religious music leader for its Sunday worship services. In addition, the selection committee's recommendation to the staff-parish committee included the statement that Leela's "ethnic background" would be a "positive for the congregation."

Leela's final interview was with the pastor who reiterated the job responsibilities that the congregation expected her to perform, including preparing the music for the Sunday worship service, practicing with the choirs in the weeks before the worship services, and leading the choirs and congregation in song during the Sunday worship services. Shortly after meeting with the pastor, Leela was hired as the choir director/music director for the church.

During her tenure with the church, Leela selected the songs in the worship services by evaluating the particular message of a service and selecting music that "coincided" with and "enhanced" the meaning of that message. She directed each musical selection that was performed by the chorus at the weekly worship services, but directing the choirs did not require her to perform in the singing or playing of the music. She selected music for each performance based in part on a planner that was given to her by the church, which included music suggestions for each service. When she was later asked what she thought "the purpose of a choir is in a church setting?," she responded, "To lift voices and sing praises to the Lord."

Leela's employment as choir director and music director was terminated six months after she was hired. She later sued her church, claiming that its decision to terminate her employment was based on her race in violation of Title VII of the Civil Rights Act of 1964 which prohibits covered employers from discriminating in employment decisions on the basis of race.

A federal district court dismissed Leela's lawsuit on the ground that she was a "minister," and that any resolution of her claims by a civil court would violate the first amendment's guaranty of religious freedom. The court began its opinion by observing that "Title VII applies to religious organizations. Congress, given the opportunity to exempt religious employers entirely, created instead a tailored exemption which exempts from operation of the statute only those hiring decisions made by religious employers on the basis of religion." However,

Notwithstanding the exemption created by Congress, courts have carved out an additional exemption recognizing that some religious interests are "so strong that no compelling state interest justifies government intrusion into the ecclesiastical sphere." In particular, the Supreme Court is wary of state intrusion on a church's selection of its ministers and spiritual leaders, and the promulgation of religious doctrine. As a result, courts … have recognized an "ecclesiastical" or "ministerial" exception which precludes the application of Title VII to the employment relationship between certain individuals and religious institutions. The ministerial exception is aimed at preventing the introduction of government standards into a religious institution's selection of its own clergy.

The court stressed that the ministerial exception has not been limited to cases involving clergy. Lay employees of religious institutions have been deemed "ministers" for the purposes of the exception where their "primary duties consist of teaching, spreading the faith, church governance, supervision of a religious order, or supervision or participation in religious ritual and worship."

In deciding whether or not the clergy exception applies, the courts look to

the function of the employee and apply the exception if the position is "important to the spiritual and pastoral mission" of the religious institution. Where an individual's employment responsibilities are sufficiently ecclesiastical, a court may determine that it is precluded from scrutinizing a religious institution's allegedly discriminatory action in the employment context. In general, the more closely an employee's job responsibilities are tied to the ministering, governing, or the development of an orthodoxy, the less likely courts are to apply Title VII to employment decisions made by the religious institution regarding that employee.

The court applied the following three factors in evaluating the ministerial status of Leela's position: (1) was the employment decision based largely on religious criteria; (2) was the employee qualified and authorized to perform the ceremonies of the church; and (3) was the employee engaged in activities traditionally considered ecclesiastical or religious, including whether he or she attends to the religious needs of the faithful? The court concluded that all three factors were met in this case, and therefore Leela was a "minister" for purposes of the ministerial exception to employment discrimination laws. In concluding that the first factor was met, the court noted that

job descriptions for the positions of director of music and chancel choir director … reveal that more was required of the positions than mere musical ability. The policy sections of both job descriptions state that music in worship rests upon [four] "music ministry keys." The director of music job description includes two responsibilities which are of particular significance with respect to religious criteria. The director must "ensure appropriate music for all regular services of the church" and "encourage and promote music ministry outreach." Additionally, one of the responsibilities of the chancel choir director job is, where possible, to choose music to fit the liturgy and or the lectionary. The policies, responsibilities and expectations of the jobs demonstrate that the defendant expected that a music ministry role be fulfilled by the director of music and the choir director.

With respect to the second factor, the court noted that Leela was qualified and authorized to perform the ceremonies of the church. She was responsible for "selecting, planning and directing every anthem and song performed by the choirs or sung by the congregation" and "this process required [her] to research the religious messages of Sunday services and to select music which coincided with those themes." With respect to the third factor, the court concluded that Leela was engaged in traditionally religious activities. She viewed her own role as having religious significance, for when asked what she thought "the purpose of a choir is in a church setting," she responded, "to lift their voices and sing praises to the Lord."

Furthermore, the court concluded, Leela attended to the religious needs of the faithful. It observed, "The choirs were specifically formed only to participate in the Sunday worship services and the two Sunday services are the time when the congregation members gather together for the purpose of renewing their beliefs and establishing their relationship with God."

Application. This case demonstrates the scope of the "ministerial exception" to federal and state civil rights laws. This exception prevents churches from being sued, under federal or state civil rights laws, for employment decisions involving "ministers." This case demonstrates that the exception is not limited to ordained clergy, but applies to any staff member whose primary duties consist of teaching, spreading the faith, or participation in religious ritual and worship.

This case also suggests that job descriptions for ministry positions should be reviewed to ensure that they adequately describe spiritual qualifications and duties. Doing so will reduce a church's risk of expending substantial amounts of time and resources in defending against discrimination claims. This becomes even more relevant when one considers that most church insurance policies contain no coverage for such claims. As a result, most churches must retain and pay for their own attorney when sued for discrimination, and pay the entire amount of a judgment or settlement.

Legal Developments

Recent Developments in Wisconsin Regarding Sexual Misconduct by Clergy and Church Workers

A Wisconsin court ruled that the statute of limitations barred an adult from suing a church and diocese for injuries he allegedly sustained as a result of a priest’s acts of child molestation.

Richard R. Hammar, Attorney, CPA

Bio

State: Wisconsin

Church Law and Tax1999-03-01

Sexual Misconduct by Clergy and Church Workers

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

• Key point. Minors who are sexually molested by church workers may not sue their church after the statute of limitations has expired. Generally, the statute of limitations begins to run on a minor’s 18th birthday. In some states the statute of limitations does not begin to run until an adult survivor of child sexual molestation “discovers” that he or she has experienced physical or emotional suffering as a result of the molestation. Other states do not recognize this so-called “discovery rule.”

A Wisconsin court ruled that the statute of limitations barred an adult from suing a church and diocese for injuries he allegedly sustained as a result of a priest’s acts of child molestation. A 10-year-old boy (the “victim”) and his parents began attending a Catholic church in 1980. The priest sexually assaulted the victim on numerous occasions during 1983 and 1984. The victim did not tell anyone about this at the time. The priest told the victim that if he told anyone, no one would believe him. The victim thought about telling his parents but did not because he did not know how they would react. The same priest had sexually abused other boys since 1977 at various diocesan parishes where he was assigned. He molested at least four other boys in the same church the victim attended, at about the same time. Two of these boys talked to each other about the abuse and decided to tell their parents. They did so in the spring of 1984, and the parents met with church officials. As a result of this meeting, and the disclosure of other victims, the bishop removed the priest from the church. The victim never saw the priest after this time. Although his parents discussed the priest’s absence, he did not tell them what the priest had done to him. The victim saw a number of health professionals over the years after the assaults, but he never told them, or anyone, because he was ashamed and frightened. He did not forget about it but tried to think about it as little as possible. The first time he told anyone was in a conversation with his uncle in early 1994; he stated at that time only that he had been abused. Soon afterwards, he told his wife and his parents. It was the opinion of a licensed psychologist that, “given the totality of what had occurred in [his] life up to 1994, he could not reasonably have been expected to make inquiries prior to that time with regard to the nature of any injuries he incurred as a result of the sexual assaults by [the priest], the cause of those injuries or [the priest’s] part of the cause.”

The victim’s parents did not learn he had been assaulted by the priest until the spring of 1994 when the victim told them. Shortly after the family began attending the church when the victim was a boy, his parents observed that he underwent intense personal suffering, withdrew from his family and made three suicide attempts. During the victim’s middle and high school years, his mother repeatedly spoke to the director of religious instruction at their church about the emotional pain her son was experiencing, including the suicide attempts, and the resulting family turmoil. Neither the diocese, the church, nor their representatives, ever told the victim’s parents that the priest had sexually abused children at their church or that their son’s difficulties were consistent with the behavior of children who had been sexually abused. In an effort to discover the reasons for their son’s unhappiness, the parents consulted with numerous professionals, but none of those efforts revealed that the victim had been sexually abused. His parents blamed themselves for their son’s condition and sought professional help for their own emotional distress.

The victim filed suit in 1994, seeking compensatory and punitive damages. He alleged that the church and diocese were legally responsible for his emotional damages on the basis of negligent placement, retention and supervision; respondeat superior and apparent authority; and failure to report the abuse to authorities. The victim’s parents also sued the church and diocese. The trial court dismissed the lawsuits on the basis of the statute of limitations, and the victim and his parents appealed. The court concluded that the victim knew the identity of the perpetrator and was aware that what had occurred was wrongful, harmful and not sanctioned by the Catholic Church. His claims therefore accrued when the abuse occurred. The court noted that the statute of limitations for personal injuries to a minor expires on the person’s twentieth birthday. Since the victim turned twenty in 1990, his lawsuit, which was not filed until 1994, was not timely.

The victim and his parents appealed. The victim argued that he did not “discover” the relationship between his suffering and the priest’s assaults until 1994, and his claims did not accrue until that date, making his lawsuit timely. His parents made a similar argument. The court rejected these attempts to extend the statute of limitations. It concluded: “As a matter of law, [the victim] discovered, or in the exercise of reasonable diligence should have discovered, the cause of his injury at least by the time of the last incident of assault, in May of 1984. Therefore, his claims against the diocese and [church] as well as those against [the priest] accrued no later than the time of the last assault. [He] had to file those claims within two years of his eighteenth birthday, and his failure to do so means they are untimely.” The court also concluded that the statute of limitations for the parents was the same as for their son, even though he did not tell them about the abuse until years later.

With respect to the victim’s claim that the church and diocese were liable as a result of their failure to report the priest’s acts of child abuse, the court concluded that this basis of liability (assuming that it exists) was also barred by the statute of limitations since it “derived” from the victim’s other claims.

Application. This case is important for three reasons. First, the court refused to apply the “discovery rule”. Most courts have reached a similar conclusion, and have refused to allow adults to sue for acts of child molestation-especially if they were adolescents at the time of the molestation. It is very difficult for such persons to convince a court that they were previously unaware of the wrongful acts or of their own injuries. Second, the court barred the victim’s parents from suing, even though they filed their lawsuit shortly after being informed by their adult son of the molestation. Third, the court refused to hold the church and diocese liable on the basis of their failure to comply with the state child abuse reporting law. The court concluded that such a claim “derived” from the victim’s other claims, and therefore it was similarly barred by the statute of limitations. In short, an adult who was molested while a minor by a church worker, and whose negligence claims against his or her church are barred by the statute of limitations, cannot sue the church for an alleged failure to report the abuse. The “failure to report” claim derives from the negligence claims, and so it must be dismissed if the underlying negligence claims are barred by the statute of limitations. Joseph W. v. Catholic Diocese, 569 N.W.2d 795 (Wis. App. 1997). [Seduction of Counselees and Church Members, Negligence as a Basis for Liability, Denominational 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: m67 m40 m86 c0299

Legal Developments

Recent Developments in Wisconsin Regarding Sexual Misconduct by Clergy and Church Workers

Richard R. Hammar, Attorney, CPA

Bio

State: Wisconsin

Church Law and Tax1998-11-01

Sexual misconduct by clergy and church workers

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

• Key point. Churches and denominational agencies will not be legally responsible on the basis of negligent supervision for a minister’s sexual misconduct if they were not aware of previous similar incidents. It is knowledge of such incidents that imposes a duty of supervision. Further, the fact that church members or even employees are aware of a previous incident does not put the church on notice-unless a member or employee was acting as an agent of the church at the time he or she became aware of the previous misconduct.

The Wisconsin Supreme Court ruled that a Catholic Diocese could not be sued as a result of an alleged sexual relationship that began when a woman began a counseling relationship with a priest who served as a hospital chaplain and counselor. The chaplain met with and counseled with a woman (the “victim”) with respect to medical and emotional problems she was experiencing after the death of her baby. After her release from the hospital, the victim continued to meet with the chaplain. The dined together, visited art museums, attended pro—life rallies, exchanged gifts, and discussed politics, personal problems, and life in general. The victim viewed the priest as her pastoral counselor during these meetings, because he gave her advice to help her cope with stress and depression. On one occasion the priest invited the victim to his family’s cabin, where they engaged sexual intercourse. Sexual relations continued for another year, until the victim informed a bishop of the affair. The victim later sued the chaplain and diocese. She claimed that the diocese was legally responsible for the chaplain’s misconduct on the basis of negligent supervision as well as a state law imposing civil liability on therapists who engage in sexual contact with counselees. The victim conceded that the diocese was not aware of her affair with the chaplain until she disclosed it to the bishop. However, she claimed that the diocese “should have known” that the chaplain posed a risk to female counselees because of an incident that happened a few years before. A parish priest heard the chaplain scream from his apartment in a rectory late one evening. The priest rushed to the apartment where he found the chaplain restraining a woman by straddling her body and pinning her arms to the floor with his hands. The chaplain was bleeding from a bite wound to his wrist. The priest separated the two, and escorted the woman out of the rectory. He did not report this incident to the bishop or any other representative of the diocese because he assumed that the chaplain had been defending himself against an attack by the woman, rather than engaging in any inappropriate sexual or intimate conduct. A trial court threw out the lawsuit, but a state appeals court reinstated the case. The diocese appealed to the state supreme court, asserting that any resolution of the woman’s claim of negligent supervision of the chaplain would violate the first amendment’s “nonestablishment of religion” clause.

The supreme court noted that the nonestablishment of religion clause bars “excessive governmental entanglement with religion,” and that entanglement occurs “if a court is required to interpret church law, policies, or practices.” On the other hand, a civil court may resolve internal church disputes if it can do so on the basis of “neutral principles of law”. The court concluded that the first amendment prohibited it from resolving the victim’s negligent supervision claim:

The reconciliation and counseling of the errant clergy person involves more than a civil employer’s reprimand of three day suspension without pay for misconduct. Mercy and forgiveness of sin may be concepts familiar to bankers, but they have no place in the discipline of bank tellers. For clergy, they are interwoven in the institution’s norms and practices.

Therefore, due to the strong belief in redemption, a bishop may determine that a wayward priest can be sufficiently reprimanded through counseling and prayer. If a court was asked to review such conduct to determine whether the bishop should have taken some other action, the court would directly entangle itself in the religious doctrines of faith, responsibility, and obedience. Likewise … negligent supervision claims would require a court to formulate a “reasonable cleric” standard, which would vary depending on the cleric involved, i.e., reasonable Presbyterian pastor standard, reasonable Catholic archbishop standard, and so on. Such individualized standards would be required because … church doctrines and practices are intertwined with the supervision and discipline of clergy …. This further explains why this court has held that negligent supervision claims are prohibited by the first amendment under most if not all circumstances.

What about the woman’s claim that the diocese should have known of the incident with the other woman in the chaplain’s apartment? The court concluded that this incident did not put the diocese on notice of any dangerous propensity of the chaplain that would have called for closer supervision, because the diocese was never apprised of the incident. Further, the priest who observed the incident was not acting in any official capacity at the time and so his awareness of it could not be “imputed” to the diocese. The priest may have been under an ecclesiastical duty to inform the diocese, but basing liability on this ground would require an analysis of church law, policies, and practices in violation of the first amendment.

The court made one additional observation. It acknowledged that the chaplain engaged in consensual sexual relationship with an adult, single female. But it pointed out that “sexual acts committed by single consenting adults are not legally wrong,” but are wrong “only under church doctrine”. Therefore, finding the diocese liable for such a relationship would be subjecting it to a higher legal duty than applies to secular employers – solely on the basis of its religious doctrine. This the court refused to do.

Application. This case illustrates the view of most if not all courts that churches and denominational agencies cannot be legally responsible on the basis of negligent supervision for a minister’s sexual misconduct if it was unaware of any previous misconduct. It is knowledge of previous misconduct (of a similar nature) that imposes a duty of supervision. Further, this case demonstrates that a religious organization will not necessarily be “put on notice” of a minister’s previous misconduct because a staff member was aware of it. The staff member must have become aware of the misconduct while acting as an agent of the religious organization. L.L.N. v. Clauder, 563 N.W.2d 434 (Wis. 1997). Seduction of Counselees and Church Members, Negligence as a Basis for Liability, Denominational Liability

© Copyright 1998 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: m67 m39 c0698

Legal Developments

Statute of Limitations Bars Group’s Lawsuit

Seven adults, molested by a priest as children, attempted to sue their former church.

Richard R. Hammar, Attorney, CPA

Bio

State: Wisconsin
Categories: Sexual Misconduct by Clergy, Lay Employees, and Volunteers

Church Law and Tax 1997-11-01

Sexual Misconduct-by Clergy and Church Workers

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

• Key point. Minors who are sexually molested by church workers may not sue their church after the statute of limitations has expired. Generally, the statute of limitations begins to run on a minor’s 18th birthday. In some states the statute of limitations does not begin to run until an adult survivor of child sexual molestation “discovers” that he or she has experienced physical or emotional suffering as a result of the molestation. Other states do not recognize this so—called “discovery rule.”

The Wisconsin Supreme Court ruled that seven adults who were molested as children by parish priests were barred by the statute of limitations from suing the priests, their churches, and a diocese. Wisconsin law gives minor victims of sexual molestation until their 20th birthday to sue the perpetrator (a longer period applies in cases of incest). The victims in this case were all terribly molested over a number of years by priests in four separate parishes. Some of the victims were only 6 or 7 years of age when they were molested, while others were teenagers. Some claimed to have been molested on hundreds of occasions. They all sued the offending priests, as well as their church and diocese. They claimed that the churches and diocese were legally responsible for their injuries on the basis of negligent supervision, “apparent agency,” negligent training, negligent placement, and a failure to comply with child abuse reporting requirements. A trial court dismissed all of the victims’ claims on the ground that they were brought long after the statute of limitations had expired. The victims insisted that they were unable to file lawsuits by their 20th birthday, because they had “repressed” their memories of the priests’ wrongdoing and did not “discover” that their emotional damages were caused by the priests’ behavior until they sought professional counseling many years later.

The Wisconsin Supreme Court ruled that all of the victims’ claims were barred by the statute of limitations. The court began its opinion by observing that “the statute of limitations should not commence to run until the plaintiff discovers, or in the exercise of reasonable diligence, should have discovered his or her injury and that the injury may have been caused by the defendant’s conduct.” The court noted that all of the victims knew the perpetrators, and knew that they had engaged in various sexual acts with them on multiple occasions. As a result, they “knew at least the identity of the responsible [person] and the nature of their injury no later than the time of the last sexual assault.” Did they also know and appreciate that their emotional injuries were caused by the priests’ misconduct? Yes, concluded the court. It categorically rejected the victims’ claim that they failed to “discover” the cause of their emotional injuries until many years after the statute of limitations had expired:

In cases where there has been an intentional … assault by one known to the plaintiff, and the plaintiff sustains actual harm at the time of the assault, the causal link is established as a matter of law. These plaintiffs knew the individual priests, knew the acts of sexual assault took place, and knew immediately that the assaults caused them injury. We therefore conclude that these plaintiffs discovered, or in the exercise of reasonable diligence, should have discovered all the elements of their causes of action against the individual perpetrators at the time of the alleged assaults, or by the last date of the alleged multiple assaults.

The court rejected the victims’ claim that younger children should be given more time to file lawsuits because they view their abusers “with respect and reverence” and cannot discover the nature of their injuries until much later in adulthood. The court simply noted that younger children have longer until their 20th birthday to file a lawsuit, and so the statute of limitations “automatically” accounts for the fact that younger children need a longer time to determine the nature of their injuries and to decide whether or not they want to file a lawsuit.

The court acknowledged that 19 other states have extended the statute of limitations for victims of child molestation, but it concluded that any modification of the statute would have to be done by the state legislature. The court cautioned that extending the statute of limitations for child abuse victims creates formidable problems. For example, those persons and organizations that are sued by victims of child abuse will have a much more difficult time defending themselves. After all, how could a church defend itself against a 50—year—old’s accusation that he was molested by a volunteer worker in the church when he was 5 years old? A related concern is fraud-that is, extending the statute of limitations will encourage fraudulent claims. The court also rejected the victims’ claim that they had suffered from “repressed memory” and therefore were unable to file their lawsuits earlier. The court concluded that “a claim of repressed memory of past sexual abuse does not delay the accrual of a cause of action for … sexual assault, regardless of the victim’s [age] and the position of trust occupied by the alleged perpetrator.”

Application. This case will be a helpful to any church that is sued as a result of acts of child molestation occurring many years in the past. Note, however, that many states have enacted statutes that extend the period of time during which victims of child molestation may file a lawsuit. Also, courts in other states have reached this same result. Further, other courts have recognized “repressed memories” as a basis for delaying the statute of limitations until a victim of sexual misconduct “discovers” the connection between his or her emotional injuries and the prior misconduct. Doe v. Archdiocese of Milwaukee, 565 N.W.2d 94 (Wis. 1997). [ Negligence as a Basis for Liability—Defenses, Denominational Liability]

© Copyright 1997, 1998 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: m67 m29 m86 m40 c0697

Legal Developments

Legal Liability of a Church Board

A court recently made an important decision.

Richard R. Hammar, Attorney, CPA

Bio

State: Wisconsin
Categories: Contracts

Church Law and Tax 1992-03-01 Recent Developments

Officers, Directors, and Trustees

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

• The Wisconsin Supreme Court addressed the legal liability of church board members in an important decision. A church-sponsored relief agency needed some plumbing work done. Its director negotiated and signed a contract with a plumbing company. The name of the relief agency was mentioned prominently in the contract, as was the fact that the director was signing in his capacity as director of the agency. The agency was unable to pay the plumbing bill, and the plumbing company sued the director personally. The director claimed that he was immune from liability on the grounds that (1) a director of an incorporated organization is immune from personal liability for his acts on behalf of the corporation, and (2) directors of nonprofit organizations are immune by law (in Wisconsin as well as in most other states) from liability for their actions on behalf of their corporation. The state supreme court rejected both defenses, and found the director personally liable on the contract. In rejecting the director’s first defense, the court observed:

This court has long adhered to the general rule that, where an agent merely contracts on behalf of a disclosed principal, the agent does not become personally liable to the other contracting party …. [H]owever, an agent will be considered a party to the contract and held liable for its breach where the principal is only partially disclosed. A principal is considered partially disclosed where, at the time of contracting, the other party has notice that the agent is acting for a principal but has no notice of the principal’s corporate or other business organization identity …. The general rule that agents are contractually liable where the principal is partially disclosed has produced the rule that an agent is liable where the contracting party is not aware of the corporate status of the principal.

The court concluded that the director, by mentioning the agency’s name in the contract but not whether or not it was incorporated, assumed personal liability on the contract under this rule. The court noted that the fact that the plumbing company was aware that the director was acting on behalf of a named agency “reveals nothing of its awareness of the type of business organization it was dealing with. All business entities are not corporations.” Further, the court stressed that the plumbing company “had no affirmative duty to investigate” whether or not the agency was a corporation. This was the director’s responsibility, if he wanted to escape personal liability on the contract.

The court also rejected the director’s claim that he was exempt from liability under a state law granting limited legal immunity to the uncompensated directors of nonprofit organizations. Wisconsin law specifies that a director or officer of a nonprofit corporation is not liable for “monetary liabilities arising from a breach of, or failure to perform, any duty resulting solely from his or her status as a director or officer.” The court stressed that a director “cannot be granted immunity unless his liability related solely to his status as a director.” In this case, however, the director’s contractual liability to the plumbing company “stems from his position as an agent to a partially disclosed corporate principal and not from his status as a director.”

What is the significance of this case to church leaders? Consider the following: (1) It suggests that church officers and directors should be sure that the corporate status of their church is clearly indicated on any legal document they sign (assuming that the church is incorporated). Simply naming the church may not be enough to avoid personal liability. For example, if John Smith is signing a legal document on behalf of First Church (a Wisconsin corporation), he should insure that First Church is identified in the body of the document as “First Church, a nonprofit corporation organized under the laws of the State of Wisconsin.” John Smith should be sure to sign in a representative capacity, such as “First Church, a nonprofit corporation organized under the laws of the State of Wisconsin, by John Smith, president.” (2) It suggests that “charitable immunity” statutes granting uncompensated directors and officers of nonprofit corporations limited immunity from liability may be interpreted narrowly. Such statutes have been enacted in almost every state over the past five years. However, this case illustrates that such statutes do not provide protection against all forms of director liability. (3) The court went out of its way to emphasize that “all members of a voluntary association are jointly and severally liable for the association’s contractual obligations …. It is generally recognized, furthermore, that numerous charitable and religious organizations are unincorporated associations consisting of a large and changing membership.” In other words, members of an unincorporated church are personally liable for the contracts of their church. This is an important consideration for members of unincorporated churches to bear in mind. Benjamin Plumbing, Inc. v. Barnes, 470 N.W.2d 888 (Wis. 1991).

© Copyright 1992, 1998 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: m56 m35 c0291

Legal Developments

Age Discrimination in Church-Run Schools

Court rules that a school’s rights were not violated in an investigation of discrimination.

Richard R. Hammar, Attorney, CPA

Bio

State: Wisconsin
Categories: Schools

Church Law and Tax 1991-07-01 Recent Developments

Freedom of Religion

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

• A Wisconsin state appeals court ruled that a church school’s constitutional rights were not violated when a state equal rights agency conducted a hearing on the age discrimination complaint of a former teacher. The teacher’s contract was not renewed following 16 years of service as the school’s third grade teacher. She was 56 years of age at the time of the school’s decision not to renew her contract. She filed a complaint with a state equal rights agency, alleging that the school’s decision was based on age and therefore violated state law. The school denied that age was the reason for its decision and cited problems with her classroom management, her professionalism, and her maintenance of a “prayerful environment.” A state investigator concluded that there was “probable cause” to believe age discrimination existed. This conclusion was based on an excellent evaluation that the teacher had received for the previous year, and the school’s record of systematically terminating the contracts of three out of four teachers who had many years of teaching experience at the school and were at the top of their pay scale. A hearing was scheduled to determine whether or not the school’s decision was based on age. The school filed a lawsuit alleging that a hearing would violate its constitutional right to religious freedom. A state appeals court rejected the school’s argument. It relied upon a 1986 decision of the United States Supreme Court holding that a state agency “violates no constitutional rights by merely investigating the circumstances of [an employee’s] discharge in this case, if only to ascertain whether the ascribed religious-based reason was in fact the reason for the discharge.” The court also relied upon other Supreme Court decisions permitting civil courts to resolve disputes involving religious organizations on the basis of “neutral principles of law.” The court concluded that the state fair employment law (which banned age discrimination) was a neutral principle of law. The court emphasized that the intrusion into the school’s religious beliefs “is minimal and is not an attempt for interfere with religious schools.” The court emphasized that “the school is still free to discharge employees for religious reasons. The school will prevail in the [state] investigation if [the former teacher] cannot prove that the religious-based reason given for her discharge was only a pretext for age discrimination. The burden of proof remains with [her].” In rejecting the school’s claim that the first amendment gives religious groups a constitutional right to “autonomy,” the court observed: “The [first amendment] guarantees religious rights to every citizen and not merely to religious institutions or their officers. We would be limiting the [first amendment] rights of individuals if we interpreted the [first amendment] as giving religious groups a right to autonomy that exempted them from judicial scrutiny …. If we accepted the school’s autonomy argument, the court would be awarding the religious employer a talisman to protect it from all discrimination lawsuits. This we cannot allow.” Sacred Heart School Board v. Labor & Industry Review Commission, 460 N.W.2d 430 (Wis. App. 1990).

See also Church property, St. Bartholomew’s Church v. City of New York, 914 F.2d 348 (2nd Cir. 1990).

Termination of Employees

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Legal Developments

Investigation of Claims of Age Discrimination

Court rules that investigation of teacher’s complaint does not violate school’s rights.

Richard R. Hammar, Attorney, CPA

Bio

State: Wisconsin
Categories: Schools

Church Law and Tax 1991-03-01 Recent Developments

Schools

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

• The Vermont Supreme Court ruled that a state law requiring church-operated elementary and secondary schools to comply with various state regulations did not violate the constitutional right of parents to freely exercise their religion. The Vermont compulsory education law requires all children between 7 and 16 years of age to attend either a public school or “a reporting private school.” All that is required of a “reporting private school” is that it file an annual report with the state department of education agreeing to offer certain courses, state its purposes, state the days and hours the school is in session, provide a list of students, and agree to notify the state when a student leaves. Monitoring whether or not a private school is offering the minimum course of study prescribed by state law is left up to the parents and not the state. A church that operated a private school refused to comply with these reporting requirements. As a matter of religious principle, it could not accept state control over the education of its children. The state criminally prosecuted two parents for violating state compulsory attendance law by sending their son to a non-reporting private school. The parents argued that their prosecution violated the constitutional guaranty of religious liberty. A trial court rejected this claim, and the parents appealed. The state supreme court began its opinion by observing that the constitutional guaranty of religious liberty is violated only if a state law burdens a sincerely-held religious belief, and the law does not serve a “compelling state interest” in the least restrictive way. The court readily agreed that the parents’ right to freely exercise their religion was “burdened” by the state compulsory attendance law. However, the court concluded that this burden was outweighed by the state’s “compelling interest” in the education of its citizens. It quoted an earlier decision of the United States Supreme Court: “Education is perhaps the most important function of state and local governments. It is the very foundation of good citizenship. In these days, it is doubtful that any child may reasonably be expected to succeed in life … denied the opportunity of an education.” The court noted that a state’s compelling interest in education “has been overwhelmingly sustained” by both state and federal courts. It observed: “[T]here have been extensive challenges to state regulation of home education or private schooling based on assertions of religious liberty. With only isolated exceptions, neutral and reasonable state regulations affecting home schooling and private education have been upheld against free exercise [of religion] challenges.” Further, the court concluded that the state’s minimal reporting requirements were the “least restrictive means” of accomplishing its compelling interest. The court observed in conclusion that when a state establishes minimum education standards, “compliance with them falls within the ambit of the fundamental contract between the citizen and society. It need scarcely be said that each of us, in order to enjoy membership in an organized social order, is pledged to adhere to a number of minimum norms. Of these, one of the most central is society’s duty to educate its children. The nature and extent of education remains largely a matter of personal choice. But there are basic minimums and, this being true, it is up to the people as a whole to set them. One way they have done this is to enact compulsory education statutes.” State v. DeLaBruere, 577 A.2d 254 (Vt. 1990).

See also Employee relations, Sacred Heart School Board v. Labor & Industry Review Commission, 460 N.W.2d 430 (Wis. App. 1990).

Legal Developments

Court Concluded Church Was Responsible for Injuries Sustained by a Volunteer Worker

Can a church be legally responsible for injuries sustained by a volunteer worker who was

Richard R. Hammar, Attorney, CPA

Bio

State: Wisconsin
Categories: Personal Injuries on Church Property or During Church Activities

Can a church be legally responsible for injuries sustained by a volunteer worker who was injured severely while helping to paint a church's fellowship hall? Yes, concluded a Wisconsin appeals court.

The volunteer was painting a steam pipe using a stepladder that was owned by the church and that had been placed on a drop cloth. Following the accident, the victim was taken to a hospital where he was diagnosed as comatose and partially paralyzed, and was placed on a life support system. Several weeks later, he had "regressed to a very primitive, vegetative level."

A lawsuit was brought against the church, and a jury determined that the victim and the church had each been 50 percent negligent, and awarded damages accordingly. The church appealed from this decision, arguing that the evidence had not conclusively established that the victim had fallen from the stepladder, and, even if it had, that the fall was due to a defect in the ladder and drop cloth. On appeal, the state appeals court disagreed with the church: "[E]xpert medical testimony indicated that injuries of the type … sustained could not usually be caused by someone falling on level ground …. Evidence also indicated that the ladder and drop cloth were a substantial factor in causing the fall …. [T]wo experts testified that the ladder [was unsafe] because it was warped and twisted, with bowed treads, loose joints and other defects, with the result that 'the ladder becomes rickety, teetery, when you get on it,' and could move suddenly, surprising someone on it … [and] that 'the front legs slipped and will slide on the drop cloth.'"

Another expert witness testified that "the ladder and drop cloth combination would be a substantial factor in someone falling off." In light of this testimony, the court ruled that the jury had properly concluded that the church was negligent "in the materials it provided to [the victim]." Kluever v. Evanglical Reformed Immanuels Congregation, 422 N.W.2d 874 (Wisc. App. 1988)

Legal Developments

Court Ruled That a Vacant Property Owned by a Religious Organization Did Not Qualify for Exemption from Real Estate Taxes

Does property vacated but still owned by a religious organization continue to qualify for exemption

Richard R. Hammar, Attorney, CPA

Bio

State: Wisconsin
Categories: Church Property, Tax Exemption

Does property vacated but still owned by a religious organization continue to qualify for exemption from real estate taxes under a Wisconsin law exempting "property owned and used exclusively by … a religious association"? No, concluded a state appeals court.

A Catholic order operated a convent on the property from 1953 through 1983, when it moved its members to new facilities in another state. The Wisconsin property was listed for sale, but did not sell for two years. A local tax assessor, finding the property to be vacant and listed for sale, determined that it was not exempt from real estate taxes for 1984 or 1985.

The Catholic order argued that the property continued to qualify for exemption even after it was vacated, since (1) it stored some maintenance tools and lawn implements there; (2) it retained a groundskeeper to maintain the property; (3) it had the property listed for sale; and (4) it maintained a mortgage on the property and used some of the proceeds to acquire its new quarters in another state.

The appeals court, in denying the order's claim of exemption, emphasized that the state law exempted only property owned and used exclusively by a religious association. "Exclusive use," observed the court, means the "physical use of the property" in connection with the "regular activities" of a religious organization. The mere maintenance and repair of the vacated property, and listing it for sale, did not amount to an "exclusive use" of the property by the order, since the property "was not being used for any of the order's regular activities or benevolent purposes." The Dominican Nuns v. City of LaCrosse, 419 N.W.2d 270 (Wisc. App. 1987)