Recent Developments in Alabama Regarding Church Property

The Alabama Supreme Court ruled that a local church, rather than a parent denomination, owned title to church property following a vote by the church to withdraw from the denomination.

Church Law and Tax1999-05-01

Church Property

Key point. The civil courts may resolve church property disputes on the basis of neutral principles of law, including nondoctrinal language in any one or more of the following documents: (1) deeds to church property, (2) a church’s corporate charter, (3) a state law addressing the resolution of church property disputes, (4) a local church’s bylaws, or (5) a parent denomination’s bylaws.

The Alabama Supreme Court ruled that a local church, rather than a parent denomination, owned title to church property following a vote by the church to withdraw from the denomination. The United Methodist Church (“UMC”) asked a court to determine the ownership of property belonging to a local congregation that passed a resolution to withdraw from the UMC. The UMC claimed title to the property, based on the local church’s hierarchical relationship with the national church and based on several sections of The Book of Discipline of the United Methodist Church. The Book of Discipline contains the governing rules of the UMC, and it requires that all property held by an unincorporated local church be held in trust for the use of both the local church and the UMC. At trial, the dissident members of the local church argued that the property rules set out in the Book of Discipline did not apply to the local church property for two reasons: (1) the local church had not been in an hierarchical relationship with the UMC, and (2) the property on which the local church is located was conveyed to the congregation in trust for a nondenominational church.

The trial court found that the local church had been connected with the UMC since 1931 and had agreed to be bound by the rules of the Book of Discipline. Based on these findings the trial court found the UMC to be the owner of the property. On appeal, the church members claimed that the trial court erred in not finding that the 1909 and 1978 deeds conveyed the property, in trust, for the benefit of a nondenominational church and that the property, therefore, could not be diverted from its charitable purpose by any agreement with the UMC.

The state supreme court began its opinion by noting that the civil courts have general authority to resolve church property disputes, although the first amendment prohibits the civil courts from resolving property disputes on the basis of religious practice or doctrine. The court further noted that it had adopted the so-called “neutral principles of law” approach to resolving church property disputes. Under this approach, the civil courts “consider, in purely secular terms, the language of the deeds, the charter of the local church, any applicable state statutes, and any relevant provisions contained in the discipline of the national church as a means of adjudicating the dispute.” Following this approach, the court found no evidence of a local church charter or any applicable state statute. Therefore, it turned its attention to an examination of the deeds to the church property, and the “property clauses” contained in the Book of Discipline.

The court noted that the property on which the local church is located was acquired in two deeds. The first deed, dated 1909, was made by several members of a family and purported to grant approximately 2 acres to “this community for a union church … to have and to hold to the said community heirs and assigns, in fee simple, forever.” The second deed, dated 1978 and issued by two descendants of the 1909 grantors, purported to transfer the same two acres as the 1909 deed and approximately two additional acres to the trustees of the “union chapel at Haney’s Chapel, their successors in office and assigns.”

The members of the local church argued that both the 1909 deed and the 1978 deed conveyed the church property, in trust, for a nondenominational, “union” church. The court noted that the 1909 deed did not contain a trust clause. In addition, the designation of the grantee as “this community” was ambiguous. In order for a deed to serve as a successful conveyance, “the grantee must be identifiable with certainty.” The court concluded that there was no consistent or clear evidence regarding the intent of the grantors or the exact meaning of “this community.” Therefore, the 1909 deed was void, and title to the original two acres on which the local church is located remained in the 1909 grantors.

The 1978 deed purported to convey the same two acres as the 1909 deed and two additional acres to three named trustees, who were described as “trustees for the union chapel at Haney’s Chapel, their successors and assigns.” The UMC argued that the trustees named in the 1978 deed were trustees for Haney’s Chapel United Methodist Church and were duly elected and recognized at a Methodist “charge conference.” However, the members of the local church argued that the three trustees represented the community and were the trustees of the local, nondenominational union church. Once again, the court found the language of the deed to be ambiguous, and so it reviewed the surrounding circumstances to discover the grantors’ intent. It concluded that the grantors intended to convey the property to the local church and to ensure that the national church could not gain title to the property. As support for this conclusion, the court noted that the 1978 deed was prepared immediately after the grantors were told by the UMC that the national organization held “equitable title” to the local church property. In response to this, a local attorney was asked to draw up the 1978 deed in order to correct any problems that existed in the 1909 deed and to carry out the intent of the original 1909 grantors. Further, the trustees listed in the 1978 deed understood that the property belonged to the local church and was not to be transferred to the UMC. One of the trustees listed in the 1978 deed testified that she and the other trustees were later asked by the UMC to “sign over the property to the Methodist Association,” but that they refused to do so. As a result, the court concluded:

[T]here appears to be no real dispute regarding the intent of the 1978 grantors …. [T]he evidence in this case indicates that the 1978 grantors intended to convey the property to the trustees of the local church and to exclude the involvement and control of the national church. Therefore, we find that the deed granted the property to the trustees of the local church; because the church is unincorporated, the trustees and their successors hold legal title for the beneficiary class of the congregation.

Application. This case is important for the following reasons. First, it demonstrates the legal consequences of ambiguities in a deed. The 1909 deed was considered null and void because its description of the grantee was so ambiguous. Church leaders eventually recognized this problem, and this led them to draft the 1978 deed. It would be a good practice for church leaders to review their church deed and see how the church is described. If there is any ambiguity in the name, then an attorney should be consulted to discuss redrafting the deed. Of course, this would require the signatures of the original grantors (or their heirs). This can be a difficult task, especially if many years have elapsed since the original deed. However, it pales in comparison to the legal consequences of a court ruling that the deed to the church’s property is null and void because the church was not adequately described. Second, the case illustrates the application of the “neutral principles” approach to resolving church property disputes. This is the approach that has been adopted by most courts over the past several years. Haney’s Chapel Methodist Church v. United Methodist Church, 716 So.2d 1156 (Ala. 1998). [State Court Rulings Regarding Church Property Disputes]

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