Disaffiliated Churches’ Property

When a church leaves its denomination, who keeps the property?

Key point. The property of a local church affiliated with a hierarchical denomination may revert to the denomination if the church votes to disaffiliate.

A South Carolina court ruled that a national church retained title to the property of a local church that voted to disaffiliate.

The national church was established in 1898 and has assisted in the establishment of several local churches. A local church purchased property in 1975 in the names of three trustees, and, with financial assistance from the national church, constructed a building on the property. A dispute developed between the national church and the local congregation which in 1994 culminated in the local congregation's formal resignation from the national church.

At the same time the trustees under the 1975 deed executed a document purporting to convey the property to the local congregation. After the local congregation's withdrawal, the national church served the local congregation with a notice stating that the national church owned the local church building and property, and ordering the local congregation members to vacate the premises. The members of the local congregation continued to use the property.

In January 1995, the national church brought a lawsuit alleging that pursuant to its Book of Discipline and the 1975 deed, it is the owner of the local church building and property. A trial court ruled that the national church owned the local congregation's property, and the case was appealed.

On appeal, the local congregation insisted that it had not been incorporated into the national church's hierarchical structure and that the 1994 deed purporting to convey the subject property to the local congregation was therefore void. The court disagreed.

[T]he trial court properly found the local congregation was a part of the national church's organizational structure. Without question, the national church is a hierarchical church, composed of bishops, ruling elders, and other officers, as well as trustees. Moreover, the local congregation has always operated as a part of the national church. Since its inception as a mission church, the local congregation consistently sent delegates to the national church's annual convention and submitted annual reports to the national church. The National Church contributed $5,000 to the local congregation to help construct the church building. The current minister of the local church was appointed by the Bishop of the national body at its annual convention. Finally, by letter dated November 16, 1994, the entire local congregation submitted its resignation from the national church, evidencing that the members of the local congregation considered themselves members of the national church. We find no error in the trial court's conclusion that the local congregation was an affiliate of the national church ….

The law is well settled that when a church splits, the courts will not undertake to inquire into the ecclesiastical acts of the several parties, but will determine the property rights in favor of the party or division maintaining the church organization as it previously existed. When the entire congregation withdraws from the hierarchical church, the title to the church property remains in the church and does not follow the congregation. In this case, the title to the property at issue remained with the national church, and title is in the trustees, who are under a duty of loyalty to act solely in the best interest of the national church.

The court also rejected the relevance of the local congregation's claim that the 1975 deed did not contain the language required by the national church's Book of Discipline:

The interpretation of the Discipline, and what it mandates, is a matter for the ecclesiastical tribunal of the national church, not the civil court. Absent fraud or collusion, the decisions of the proper church tribunals on matters purely ecclesiastical, although affecting civil rights, are accepted in litigation before the secular courts as conclusive because the parties in interest made them so by contract or otherwise …. While not inquiring into the wisdom or correctness of ecclesiastical decisions, the court will make sure that the civil right is in fact dependent upon an ecclesiastical matter; it will determine whether the ecclesiastical body had jurisdiction; it will look to see if the steps required by the religious society have been taken; and will inquire into any charges of fraud or collusion. It will go no further.

In this case, a civil right, the ownership of property, is dependent upon an ecclesiastical matter, the interpretation of the national church's rules as promulgated in its Discipline. Having found the local congregation was a part of the national church organization, and because the local congregation has abandoned its claims of fraud and misrepresentation, this court must accept as conclusive the decisions of the national church with regards to the subject property. Fire Baptized Holiness Church of God of the Americas v. Greater Fuller Tabernacle of Fire Baptized Holiness Church, 475 S.E.2d 767 (S.C. App. 1996).

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