Thursday, May 2, 2013

Judge's Ruling in St. James Case Puts Cloud on Many Former Episcopal Properties in California

Judge Kim Dunning of the Orange County Supreme Court handed down on May 1 a surprise ruling in the case involving the property of St. James's parish in Newport Beach, and held that St. James could not retain title to its property after it voted in 2004 to disaffiliate from the Episcopal Church (USA). But due to the bizarre reasoning she used to reach that conclusion, the ruling -- if upheld on appeal -- would put a cloud on the title of every previous sale or disposition of any Episcopal parish property in the State since 1980.

The wrinkle in the St. James case -- a feature which distinguished it from the cases of two other parishes in the Diocese of Los Angeles (St. David's Hollywood; and All Saints, Long Beach) which Judge Dunning ruled last September could not retain their properties either -- was that St. James had been given an explicit letter from the Diocese in 1991 prior to purchasing the property at issue here, and undertaking the multi-million-dollar expense of developing it. The letter, written by then Canon to the Ordinary D. Bruce MacPherson (who resigned last year from his later jurisdiction as the bishop diocesan of Western Louisiana), told the parish (its text is reproduced on page 5 of the opinion linked above, and a facsimile of the original may be viewed on page 12 of the brief linked here; I have added the bold emphasis below):
The Rector, Wardens and Vestry of Saint James' Parish, Inc. of Newport Beach, are given permission by the Bishop of Los Angeles, the Rt. Rev. Frederick H. Borsch, to purchase and own the property on 32nd Street in Newport Beach, in the name of the Rector, Wardens and Vestry of Saint James' Parish, Inc. and not held in trust for the Diocese of Los Angeles, or the Corporation Sole.
On the strength of that letter, St. James said in its papers opposing the Diocese's motion for summary adjudication as to the ownership of the property, it had "changed its position to its substantial detriment" by investing millions of dollars in the acquisition and development of what was then (and still is) prime real estate in one of the wealthiest areas of Orange County.

But after St. James voted to disaffiliate in 2004, the current Bishop of Los Angeles, the Rt. Rev. J. Jon Bruno, reneged on the prior understanding and filed suit for all of the parish's properties -- including that which it had purchased in 1991. ECUSA added its voice to the property claims by filing a complaint in intervention. And now Judge Dunning has ruled that the letter, "as a matter of law ... was not effective to erase the trust under which the St. James Parish properties were held" (italics added).

The trust that the letter could not erase was, of course, the Dennis Canon, purportedly passed by General Convention in 1979 (the key records that would show its consideration and passage by both houses of that body have since mysteriously been lost, or else never existed in the first place). California courts have held that its unilateral declaration of a universal trust on all Episcopal parish properties everywhere was authorized by a specific statute which took effect in 1980 (Corporations Code Section 9142 [c]), and that the Dennis Canon has the force and effect of law in California as a consequence.

Now comes Judge Dunning, however, and rules that a diocesan bishop is without authority to release the trust on behalf of ECUSA, no matter what. She bases this conclusion on the authority of affidavits  submitted by ECUSA's well-paid historian, Prof. Bruce Mullin, and by the Rt. Rev. John Buchanan (provisional bishop of the rump diocese of Quincy), which contended that no one Episcopal bishop has any authority to alter or suspend the canons in his diocese, or to speak for or to bind ECUSA in any matter.

(Those opinions might come as a surprise to those bishops who have suspended the marriage canons in their diocese to provide a "pastoral response" to gay couples, or who have suspended the applicability of the canon requiring that all persons partaking of Holy Eucharist be baptized. And of course, no one said anything about the self-contradiction inherent in Bishop Buchanan's proclaiming, on behalf of ECUSA, that no one bishop may speak for ECUSA.)

So according to Judge Dunning's May 1 ruling, the trust imposed on all Episcopal parishes in California may only be dissolved in the manner by which it was imposed in the first place -- by a canon duly enacted by General Convention.

Do you understand now the huge impact this ruling could have if it is affirmed on appeal?

According to it, since no sale of any California property owned by an Episcopal parish ever received any release of the Dennis Canon by General Convention, then all of those properties that have been marketed and sold since 1980 -- parking lots, rectors' residences, and auxiliary properties, to say nothing of church buildings themselves -- are still subject to the Dennis Canon trust, no matter what any diocesan bishop or standing committee purported to allow. They were not the General Convention.

To reach her ridiculous conclusion, therefore, that no one diocesan or standing committee may waive or release the Dennis Canon on behalf of any Diocese, or on behalf of the national Church, Judge Dunning has managed at one stroke to cloud the titles of hundreds, perhaps thousands, of pieces of property sold and conveyed by Episcopal parishes in California since 1980.

And that is just one problem with her seriously flawed decision, which relies upon circular reasoning and deliberate misreadings of parish governing documents, as well. The decision is not only a travesty of justice, but as I say, it should make title companies all across California fear for all of the various policies they have issued to buyers of church property since 1980.

[UPDATE 05/03/2013: Of course, the impact of this ruling on the Diocese of Los Angeles itself has probably not yet dawned upon Bishop Bruno and his allies. It means that the Diocese will not be able to offer free and clear marketable title to any of the properties it has confiscated over the years from so many of its former parishioners: St. Luke’s in the Mountains, St. David’s, All Saints ... and now St. James. Unless and until the Diocese can obtain an amendment to the Dennis Canon from General Convention, the Court’s ruling means that all those properties remain impressed with a trust in favor of ECUSA, which cannot be modified, altered, waived or released in any way. Moreover, lenders will now not loan against ECUSA parish properties for purchase or construction unless General Convention agrees to subordinate its Dennis Canon to the loan in every case. Watch out what you ask for, Bishop Bruno! And good luck with recovering the millions you have spent on property fights.]

Making a mish-mash of the law of the several States in this fashion must be what ECUSA really wants, because that is just what it has systematically been doing over the past ten years (and more). It cares not about the effects or difficulties that its arguments may cause for other law-abiding property owners, just so that it can pursue its scorched-earth policy to let no disaffiliating parish go unpunished, anywhere.

And God save us from unthinking and unaware judges who have no clue to what they are holding, finding, or deciding. Save for a random and capable judge here and there, the majority of them have shown themselves less than equipped for the tasks which these cases present.





13 comments:

  1. Yes, but judges these days are first and foremost a diverse group. All the rest, such as actual competence and judicial temperament, is optional.

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  2. It looks like knowing the law is not a requirement to become a judge. I'm not sure if this one could decide a jay walking case. She needs to go back to law school or find another profession.

    David Katzakian

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  3. A question involving the recent decision involving St. James, Newport Beach: Has the Supreme Court of California ruled that a trust may be created in California in the manner purported to be created by the so-called Dennis Canon or are there only lower court decisions involving this issue to one degree or another?

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  4. Hi, williamp -- yes, as I explained in this earlier post, the California Supreme Court has interpreted Corporations Code 9142 (c) to give the Dennis Canon full force and effect in California.

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  5. Dimwitted judges are sure making a lot of work for a lot of people these days.

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  6. This is insane! The ECUSA cabal has proven for years that it cares nothing for it's members. I think the time has come for a class action suit to be filed on behalf of all Episcopalians who know that the ECUSA oligachy never intended to pastor and serve them but has demonstrated their only concern was for acquisition of property. For us the issue has never been property; it has been following Jesus and what He would have us do.

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  7. Mr. Haley--Thanks for your reference to your post re the earlier Supreme Court decision.
    Judge Dunning's recent decision appears to me to raise two issues that don't appear favorable to positions of the Episcopal Church and the Diocese of Los Angeles.

    The first issue is whether her decision holds that the Episcopal Church is not a hierarchical church as a matter of law. It's probable that the bishop who issued the letter re the Dennis canon involved in this dispute probably consulted with legal counsel before issuing that document, and even if that wasn't the case, the bishop must have believed he had the apparent authority to waive the application of the Dennis canon to St. James Newport Beach or he wouldn't have been acting in good faith in taking the action he did. Thus, when Judge Dunning reasons that this bishop simply didn't, as a matter of law, have the authority to waive the Dennis canon, she appears to assert that that the denomination isn't actually hierarchical and it further appears her decision goes on to issue a judicial interpretation of a denomination's canon law (interestingly, a denomination that asserts it is hierarchical).

    Also, wouldn't the Episcopal Church and the Diocese of Los Angeles, as a matter of law under the circumstances of this case, estopped from taking ownership of the property(-ies) involved in the litigation? Not only had there been in existence since the issuance of the letter involved in this case an issue of apparent authority--which the denomination and the Diocese of Los Angeles knew or should have known--but there also was apparent inaction on the part of the denomination and the Diocese of Los Angeles with regard to any notice to St. James Newport Beach that the purported waiver of the Dennis canon was ineffectual and improperly issued.

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  8. To me, it is a perfect sociological storm. Secular humanists who either do not know or do no care what the terms Common Law or Constitutional law mean, and who are committed to the progressive, Marxist agenda....link up with secular humanists who have essentially stormed the pulpits to drive the last living traditionalist Orthodox Anglicans into the wilderness.
    It has been going on for over 50 years, it has been being done by plan, and my sense is that our victories will become increasingly rare if a few charismatic preachers of the Traditional and 1928 variety cannot take to the air waves and to tent meetings, if need be, to mobilise the remnants who can still recite the 2nd Chapter of Luke from the King James Unabridged.....and the General Confession from the 1928 book I shall keep my armour burnished, and the tack of my mount in good repair. But, why?

    Ye frequent posters know that I read each of your comments two or three times, and always the opening topic as posted by our Vicar...always three times, before commenting. It seems we celebrate once and lament thrice as we go down this Trail of Tears. It is some solace, that as the judgements and renderings went, were it to have been in Texas, it is certain that the titles involved would have never qualified for title insurance until after a generation of litigation. Would that it be so in California.
    Thank one and all, each for his/her attention and time invested. And God Bless Our Vicar for all this incredible research and interpretation. Could you all imagine what this quality of counsel would cost???
    El Gringo Viejo

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  9. I can't evaluate the Curmudgeon's contention of clouded titles et al., but the judge's opinion on the face of it seems sound. Yes, St. James was promised "ownership" of the properties along 32nd; and yes, it seems a clear contradiction of the Canons and other considerations; and yes, it raises questions about all sales or purchases of property by local churches or the diocese . . . . but really, do these other sales/purchases really matter if everyone is satisfied with the transaction, and no one takes it to court?

    If the Curmudgeon is correct, then I foresee that the issue of St. James, Newport Beach will remain in court for one more appellate (or state Supreme Court) round. Would it change the basic result, or merely resolve the potential complications? I strongly suspect the latter.

    Does it matter if bishops disregard the canons to assist same-sex unions? Only if someone takes it to court -- in which case I suspect the court would refuse to rule on an internal matter of doctrine and practice.

    Is the Curmudgeon displeased by the ruling? Obviously. Let me just say this: had St. James done the virtuous, Scriptural thing by simply walking away from a denomination it no longer agreed with, using its millions from affluent parishioners to build a new facility; or had St. James negotiated a mature, "amicable divorce" by purchasing its current property outright . . . . would we have had any of these wranglings? Of course not.

    As someone who was a member of St. James from 1988 to 1995, I can say that it had a narcissistic persecution complex that came from the top down. And I don't think the seeds laid in during that time have ever been uprooted. At the time, it was a dysfunctional (and occasionally abusive) parish. The bishops and the diocese were publicly disrespected when they did anything that the rector disagreed with. The break in 2004 was foreseen well before I left. I think that the only way to cleanse the parish of its legacy of abusive disagreement with others is to have this culture of pridefulness soundly and finally defeated. I hope that the May 1st ruling will accomplish that.

    Whether or not you agree with the doctrinal contentions of St. James doesn't matter. Trying to take a building away from the diocese is simply poor form. I have no issue with deeply conservative churches that simply "walk away" -- it's a free country, after all. But those churches that think they're "right-er" than others, which gives them license to disregard common, historical concepts of ownership and trust -- they need to be humbled. It's for their own good, and the good of all who seek spiritual comfort and solace there.

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  10. David Underwood, you obviously have your issues with a parish that you knew a couple of decades ago, and it may be time to follow your own words by way of example.

    My problem with the court’s ruling is that it does not follow the law that any trained lawyer would expect here – bylaws (canons) can be waived, just as you say bishops may freely do so in the case of same-sex marriages. So why should a church-sponsored same-sex marriage ceremony in California be valid, but a property acquired by a parish be subjected to the Dennis Canon, even if the bishop says it is not? In the one case, you say: “Fine and dandy – let the canon be waived”; but in the other case you say: “The Court and the Diocese were right to enforce the canon.”

    The unspoken assumption behind both your statements is that in the former case, it would be waived for modern-day (“liberal”) parishioners, while in the latter case it would not be waived for long-standing (but very traditional, or “conservative”) parishioners.

    This double standard – “It’s OK if the law is not followed when we agree with the outcome that results, but it must be followed whenever we want the particular outcome that results” – is what is killing both our legal system and our Church. Neither respects the law anymore, so all view them just as one more tool to accomplish a political end.

    When politics subsumes everything, God (and everything else He orders) is shut out, and man takes over. Good luck with that.

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  11. Some clarifications: I didn't mean to imply that "liberal" departures from the Canons are okay, and "conservative" ones are not. I meant that blessing same-sex unions is an issue no court will touch; determining the ownership status of a building is.

    I do wonder whether the 1991 letter to St. James was offered in ignorance of the Canons, or was a somewhat cynical, political move. At the time, St. James was already considered rather truculent by most of the diocese. Isn't the very idea that parishioners won't commit to a building campaign unless the Diocese waives ownership a big red flag? Doesn't the notion that "we paid for it, therefore we own it and not the diocese" subvert quite a bit of traditional understanding?

    So I'm imagining that back in 1991 the assurance was given so that the building program WOULD continue, in spite of this implicit rebelliousness. Perhaps the bishop thought a breach would never occur; perhaps he thought that even if a breach did occur, the 1991 letter would be legally meaningless. And maybe, just maybe, the letter prevented a breach from occurring earlier than it did.

    I can certainly understand why St. James feels betrayed, having relied on (I think) a rather generous interpretation of how much the letter guaranteed. But I stand by my contention that a more mature handling of the situation -- a walkaway or a negotiated buyout -- would have been way better in spiritual terms than what happened. It played out the way it did because of pride -- and by that, I mean St. James' culture of pride.

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  12. David Underwood, thank you for your response and its reasonable tone (a tone which is not always in evidence here). I humbly submit that you might benefit from some of the resources on this blog: such as this post, for example, on the previous history of ECUSA property disputes (scroll down until you begin to read about King's Chapel, Boston) -- or this post, about the problems in the so-called "passage" of the Dennis Canon, or this one about how the Dennis Canon is actually a Trojan Horse for ECUSA, or this series of posts about what ECUSA and its Dioceses have actually accomplished with the various church properties they have appropriated through the Canon and compliant civil courts.

    There can be no question but that the weight of recent California court precedent is against St. James parish. But I stress my point (made in the post above) that the law in California was totally different at the time in 1991 when individual donors wanted to give money for the benefit of just the parish, and not the Diocese or the National Church.

    Because of that fact, I think it incongruous to ascribe today's views of church property disputes to Canon MacPherson, or to otherwise cast aspersions on the integrity of his promise at the time. He believed that his letter sufficed to release or waive the Dennis Canon, and since that belief was fully in accord with the court decisions at the time, there is no need to question it further.

    But there is a pressing need to question the bona fides of Bishop Bruno in reneging on his predecessor's promise. And I would be the last one to be surprised if the individual donors to St. James in 1991 do not now sue the Diocese of Los Angeles for a return of all the money (plus interest) they donated in reliance on the promise of Bishop Borsch, as conveyed through his Canon to the Ordinary.

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  13. It seems to me that the diocese would want make a beeline to the court to appeal as they have more to lose. If the ruling stands, they can’t sell any property to raise money and they may face lawsuits from contributors who want their money back.

    David Katzakian

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