Neutral Principles’ in Church Property Disputes

Courts can intervene in church property disputes without impeding on religious freedom.

Church Law and Tax 1996-01-01

Church Property

Key point. A church affiliated with a hierarchical denomination may be able to retain its property if it disaffiliates from the parent denomination, despite a provision to the contrary in denominational bylaws.

A New York court ruled that a local church that disaffiliated from the Episcopal Church in 1976 retained control of its property. The church was organized in 1859 for the purpose of establishing a church “in communion with the Protestant Episcopal Church in the Diocese of New York, and in the United States of America, and in accordance with its doctrine, discipline, and worship.” Pursuant to the ecclesiastical custom of the day, the church’s trustees presented the Diocese of New York with a document requesting the bishop to take the church building “under his spiritual jurisdiction as bishop.” The document relinquished all claims by the church trustees “to any right of disposing of said buiding.” 1976 the church disaffiliated from the Episcopal Church in the United States and its New York Diocese on the basis of changes in doctrine and practice approved by the national church at an General Convention held earlier that year. The church then associated with the Anglican Church. The New York Diocese filed a lawsuit asserting ownership and control of the congregation’s property. A state court ruled that the local congregation retained ownership and control of its property following its disaffiliation from the Episcopal Church. The court observed:

[E]ven though members of a local group belonged to a hierarchical church, they may withdraw from the church and claim title to either personal or real property provided that they have not previously ceded the property to the denominational church. In other words, the facts that this [church] was originally part of a hierarchical body does not necessarily bind a court if it is possible to decide the controversy through the application of “neutral principles of law.”

The court noted that recent decisions of the United States Supreme Court “severely circumscribe” the role that civil courts may play in resolving church property disputes, and, most importantly, “prohibit civil courts from resolving such disputes on the basis of religious doctrine and practice, requiring that civil courts defer to the resolution of issues of religious doctrine or polity by the highest court of a hierarchial church organization.” However, the Supreme Court has permitted civil courts to resolve church property disputes on the basis of the “neutral principles of law” approach. This approach relies on nondoctrinal language in “deeds, the terms of local charters, state statutes governing the holding of church property, provisions in the constitution of the general church concerning the ownership and control of church property and other such documents and principles.” The civil courts, to the extent they adopt the neutral principles approach, resolve church property disputes on the basis of nondoctrinal language in these documents, if dispositive language exists. The court observed:

Succinctly stated, in applying neutral principles, a court must determine from the above referenced documents whether there is any basis for a trust or similar restriction in favor of the general church, “taking special care to scrutinize the documents in purely secular terms and not to rely on religious precepts in determining whether they indicate that the parties have intended to create a trust or restriction.”

The court acknowledged that there can be an implied trust in church property for the denominational church. However, to establish such a trust there must be a sufficient manifestation of the intention to do so. The court concluded that there was insufficient evidence in this case of an implied trust in favor of the diocese or national church. It observed: “[I]t is clear that [the congregation] acquired the property in question on its own and there is no specific evidence either in the deeds which form a part of the record nor by any other evidence … that [the congregation] intended to hold the property in trust. When [it] disassociated itself and revised its corporate charter, the [national church’s] ecclesiastical law was not in place to govern the disposition of [the congregation’s] property.” The court pointed out that the “deeds to this [church] contain no forfeiture or significant reversionary clauses.” Further, “the in communion with” language was ecclesiastical and accordingly was of no legal significance. Diocesan Missionary and Church Extension Society v. Church of the Holy Comforter, 628 N.Y.S.2d 471 (Sup. 1994). [ State Court Rulings Regarding Church Property Disputes]

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