Monday, February 1, 2010
C.A. Reverses Ruling Giving Local Churches Control of Property
By STEVEN M. ELLIS, Staff Writer
The Third District Court of Appeal on Friday reversed a ruling allowing two Sacramento-area Presbyterian churches to take their property with them as they left the national church.
The court held in an unpublished opinion that the trust in which the local churches held property for the Presbyterian Church U.S.A. could only be revoked by amending the national church’s constitution, not through amendments to the local churches’ articles of incorporation.
The First Presbyterian Church of Roseville and Fair Oaks Presbyterian Church sued the national church in March 2007 to quiet title in the property shortly before voting to leave and affiliate with the more conservative Evangelical Presbyterian Church.
Placer Superior Court Commissioner Margaret Wells granted the local churches summary judgment, ruling that they revoked any trust in which property was held for the national church by amending their articles of incorporation.
Justice Richard M. Sims wrote on appeal that reversal was compelled under Corporations Code Sec. 9142—which required the trust to be revoked in the same manner in which it was created—and the California Supreme Court’s decision last year in Episcopal Church Cases 45 Cal.4th 467, which was issued after Wells’ ruling.
There, the state’s high court ruled that three Southern California parishes which left the Episcopal Church over its ordination of an openly gay minister lost ownership of their church buildings and property by disaffiliating themselves from the parent church.
The Roseville church, which was founded in 1873, and the Fair Oaks church, which began in 1952, each acquired real property in their own name before and after a 1981 amendment to the constitution of the national church’s predecessor placing all property held by local churches in trust. The current incarnation of the national church was formed when separate entities representing the northern and southern parts of the country merged in 1983, ending a split that had existed since the Civil War.
Like the Episcopalians, the Presbyterian Church has been confronted with a split in recent years over issues including the ordination of gay clergy and same-sex marriage.
Both the Roseville and Fair Oaks churches reportedly agreed to pay the national church to leave with their property, but the deal was scuttled when another local church said the national church had an obligation to obtain fair market value for the property.
The Roseville and Fair Oaks churches amended their articles of incorporation in 2006 to indicate they held their property free of any trust interest. Despite their argument that the trust provision was unenforceable, Wells assumed it was valid but agreed that they revoked it.
However, Sims said any attempt to show the local churches validly revoked the trust failed as a matter of law. Quoting the Episcopal Church Cases opinion, he said that the language of Sec. 9142 meant that the trust clause in the national church’s constitution could only be revoked by amending the constitution.
The justice rejected the local churches’ argument that there was no evidence they ever consented to their property being placed in trust.
“Fair Oaks [agreed] in its articles of incorporation to subordinate itself to the national church,” he wrote. “The record on appeal does not appear to contain similar evidence with respect to Roseville but, as we have said, the record on appeal is incomplete. Moreover, there is some evidence in the record that local churches were represented in the vote to amend the national church’s constitution.”
Justices Tani Cantil-Sakauye and Vance W. Raye joined Sims in his opinion.
The case is First Presbyterian Church of Roseville v. Presbytery of Sacramento, C060451.
Copyright 2010, Metropolitan News Company