BREAKING NEWS: California Supreme Court Issues Ruling

IMPORTANT UPDATE: California Supreme Court rules that Neutral Principles of Law, not "Deference" to Church "Hierarchies," governs church property disputes

ST. JAMES CHURCH’S LEGAL BATTLE TO CONTINUE IN THE SUPERIOR COURT

NEWPORT BEACH, Calif. – January 5, 2009 – The California Supreme Court today ruled in Episcopal Church Cases that church property disputes must be resolved by “neutral principles of law,” not by civil courts merely deferring to the decrees of church “hierarchies.” This ruling has wide and favorable impact for churches throughout California that seek to change their denominational affiliation.

While adopting this “non-religious” method of resolving property disputes between churches, the Court seemed to defer to the Episcopal Church’s alleged “trust canon,” which purports to create a trust interest in church property owned by local congregations. The Court made its ruling despite the fact that St. James Anglican Church, Newport Beach, purchased and maintained its property with its own funds and has held clear record title to its property for over fifty years.

In recent years, religious denominations as diverse as the Eastern Orthodox, Baptist and Pentecostal “Assemblies of God” have attempted to confiscate the property of congregations that wish to change their spiritual affiliation. Today’s ruling falls far short of the endorsement of such tactics that the Episcopal Church – and other denominational hierarchies that submitted briefs in support of it – had sought. Many local churches in California will be able to exercise their religious freedom to change their affiliation without having to forfeit their property as a result.

Nor is the saga over for St. James Anglican Church. “While we are surprised that the Court seemed to give some credence to the Episcopal Church’s purported rule confiscating local church property, the battle is far from over,” lead attorney Eric C. Sohlgren said. “The matter will now return to the Orange County Superior Court for further proceedings, and we look forward to presenting evidence and additional legal arguments that St. James Church should prevail under neutral principles of law.”

The leadership of the Newport Beach congregation is also evaluating a possible appeal to the U.S. Supreme Court and is meeting to discuss other possible steps. Today’s ruling also affects All Saints Church in Long Beach and St. David’s Church in North Hollywood, whose cases were put on hold pending the outcome of the St. James case. Together with St. James Church, these congregations never agreed to relinquish their property to the Episcopal Church upon changing their affiliation, and have consistently maintained that they have the right to use and possess the property which they have owned and maintained for decades.

A Brief Recap

In August 2004 St. James Church disaffiliated from the Episcopal Diocese of Los Angeles and the Episcopal Church over theological differences involving the authority of Holy Scripture and the Lordship of Jesus Christ. The Episcopal Diocese of Los Angeles brought lawsuits against St. James Church, All Saints Church and St. David’s Church and their volunteer board members in September of 2004. Subsequently, the national Episcopal Church intervened into the lawsuits against the three local church corporations and their volunteer board members.

On August 15, 2005, the Honorable David C. Velasquez of the Orange County Superior Court ruled in favor of St. James Church and struck the complaint brought by the Diocese of Los Angeles. In October 2005, Judge Velasquez issued a similar ruling in favor of All Saints and St. David’s Churches. The Diocese of Los Angeles appealed the rulings to the California Court of Appeal.

In July 2007, the California Court of Appeal, Fourth Appellate District, Division Three, in an opinion authored by Presiding Justice David G. Sills, reversed the Orange County Superior Court’s prior ruling that three church corporations which disaffiliated from the national denomination did not forfeit their property. This division of the appellate court broke with nearly thirty years of California church property law, and Division Two of the Fourth Appellate District, by ruling that general churches can take over local church property by simply passing an internal rule – even if the local church is separately incorporated, bought and maintained the property.

In August 2007, the three California Anglican churches announced the filing of petitions with the California Supreme Court to settle a church property dispute case that affects countless churches and their members throughout California. The three churches are St. James Church in Newport Beach, All Saints Church in Long Beach, and St. David’s Church in North Hollywood. The Court heard oral argument in the case in October 2008.

MONDAY AFTERNOON - The Ruling is here. The Episcopal Church wins. Laity beware.

LA TIMES:

Reporting from San Francisco and Los Angeles -- The California Supreme Court decided unanimously today that churches that break away from a national denomination may not take the church assets with them.

In a ruling written by Justice Ming W. Chin, the state high court said the property of St. James Episcopal Church in Newport Beach is owned by the national church, not the congregation. The congregation split away after the national church ordained a gay man, V. Gene Robinson, as a bishop of New Hampshire, in 2003.

"When it disaffiliated from the general church, the local church did not have the right to take the church property with it," Chin wrote for the court.

St. James was one of about 100 Episcopal parishes that broke off relations with the national church following Robinson's ordination. Disputes over the real estate landed in courts across the country.

California's ruling was in line with most other state courts that have ruled on similar church property fights. The ruling is expected to reach beyond the Episcopal Church and affect other denominations facing rebellious congregations.

It follows a decision last month by 700 conservative Episcopalian congregations to form a breakaway church in North America. The move, prompted in part by disputes over the role of gays in church life, is likely to trigger new disputes over church property.

The presiding bishop of the Episcopal Church, the Most. Rev. Katharine Jefferts Schori, has said that church buildings and other property claimed by breakaway parishes belong to the national church as "the product of legacies of generations before us."