Recent Developments in Indiana Regarding Unincorporated Churches

The Indiana Supreme Court ruled that members of an unincorporated church can sue their church for injuries they suffer on church property or in the course of church activities.

Church Law and Tax1999-03-01

Unincorporated Churches

Key point.. In some states, unincorporated churches are viewed as an entity rather than a group of individuals. As a result, members who are injured in the course of church activities can sue their church without having the case dismissed as an example of “members suing themselves”.

The Indiana Supreme Court ruled that members of an unincorporated church can sue their church for injuries they suffer on church property or in the course of church activities. The court reversed previous rulings in which it had applied the traditional rule that members of an unincorporated church cannot sue their church. The facts of the case can be quickly stated. A church member (the “victim”) attended a meeting of a local “Toastmasters” chapter that had rented a portion of the church for the evening. Both members and non-members of the church attended the function. Over the course of the evening, some snow and ice accumulated in the parking lot of the church. After spending about two hours inside, the victim left the church and walked toward her automobile. As she neared her car, she slipped and fell. An associate pastor saw her fall and immediately drove her to the hospital, where she received treatment for a broken arm. The associate pastor later commented to the church’s business manager that the parking lot had been slick on his way into the church earlier that evening and was still slippery on his way out when he saw the victim fall.

The victim later sued her church and its 9-member board of trustees for her personal injuries, alleging negligence for failure to properly maintain the parking lot, failure to inspect the parking lot for dangerous conditions, failure to remove the snow and ice from the parking lot, and failure to warn her of the dangerous conditions. The trustees and church pointed out that the church was unincorporated, and as a result the victim could not sue them. A trial court agreed, applying the traditional rule that a member of an unincorporated association cannot sue the association for the negligence of another member. This rule is based on the following considerations: (1) unincorporated associations are not “legal entities” and therefore cannot be sued directly; (2) members of an unincorporated association are engaged in a “joint venture,” and therefore the negligence of one is imputed to all the others. In this case, this meant that the negligence of the church leaders in failing to remove snow and ice from the parking lot was imputed to the victim, preventing her from maintaining her lawsuit. The victim appealed. A state appeals court agreed that the victim could not sue the trustees, but it concluded that she could sue her church. The church appealed to the state supreme court.

The supreme court began its opinion by observing:

As a general rule, a member of an unincorporated association may not sue the association itself for injuries suffered as a result of the tortious acts of the association or its members. The rule rests upon the doctrine of imputed liability. Under the theory of imputed liability … members of an unincorporated association are engaged in a joint enterprise. The negligence of each member in the prosecution of that enterprise is imputable to each and every other member so that the member who has suffered damages through the tortious conduct of another member of the association may not recover from the association for such damage. It would be akin to the person suing himself as each member becomes both a principal and an agent as to all other members for the actions of the group itself.

However, the court concluded that the traditional rule had to be abolished, and that members should be allowed “to bring tort actions against the unincorporated associations of which they are part.” It listed the following considerations to justify its decision: “(1) it is inherently unfair to require an injured member, who is one of a number of equally faultless members, to bear a loss incurred as a result of the association’s activities; (2) there is no reason to limit the availability of the insurance that associations can, and presumably often do, obtain to avoid unexpected liabilities of the members as a result of exposure to third party claims.”

The court cautioned that an injured member’s right to sue his or her unincorporated church was subject to some important limits. Most importantly, “while a member may now sue an unincorporated association in tort, she may only reach the association’s assets. If she wishes to reach the assets of any individual, she must name that individual as a party and prove that individual’s fault, as always. As a result, individual members, including officers and trustees, may not be held vicariously liable for a judgment against the association.” This is an important clarification, for it demonstrates that members of unincorporated churches (in Indiana) will not be personally liable for the acts of other members so long as they did not participate in or ratify those acts.

The court sent the case back to the trial court for trial.

Application. What is the significance of this case? Consider the following:

1. It demonstrates the erosion of the traditional rule that unincorporated churches could not be sued by members.

2. The court noted, however, that the tradition rule is still applied in several states, including Rhode Island, Wyoming, Vermont, Pennsylvania, Wisconsin, and Washington. It is likely, however, that courts in these states eventually will abolish the traditional rule.

3. The court stressed that individual members of unincorporated churches (in Indiana) cannot be sued as a result of the acts of other members, unless they participated in or ratified those actions. To illustrate, if a member of an unincorporated church injures someone through negligent driving of a church vehicle, the victim can sue the church and negligent driver but not members having nothing to do with the accident. Of course, the victim may be able to demonstrate that church board members were negligent in allowing the member to drive (for example, if the driver had a poor driving record or had a suspended license). Hanson v. Saint Luke’s United Methodist Church, 1998 WL 904830 (Ind. 1998). [Unincorporated Associations]

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