Tuesday, August 19, 2008

Victories in Virginia

Judge Randy Bellows has all but disposed of the issues remaining in the litigation between The Episcopal Church, the Episcopal Diocese of Virginia, and eleven of the churches who voted to withdraw from the Diocese and form the Anglican District of Virginia (ADV) in December 2005, and who also chose to affiliate with the Congregation of Anglicans in North America (CANA). (There are some twenty Virginia churches in all who have withdrawn from TEC and joined the ADV. When TEC and the Diocese chose to break off negotiations for an orderly withdrawal in January 2007 and to file separate lawsuits, they sued only those churches in the ADV who were CANA members, along with their rectors, vestry members, and the trustees who held the legal title to the churches' property.) To understand better the significance of Judge Bellows' latest rulings, a little background will be helpful.

In their complaints, TEC and the Diocese sought declarations that all the churches' property was held in trust for the Diocese and TEC (an attempt to enforce TEC's notorious Dennis Canon, first adopted at GC 1979), and could not be transferred to or used for the benefit of any congregation not affiliated with TEC. They further sought orders from the respective courts directing that the defendants transfer the churches' property and assets to the Bishop of Virginia, the Rt. Rev. Peter James Lee, that they vacate the churches in question and render an accounting to Bishop Lee for all of the parish moneys and property in their hands. TEC's complaint in addition asked for a preliminary injunction, pending trial of the action, to restrain the defendants from transferring away any of the churches' property.

Eight of the eleven CANA churches had property, some of which dated to the colonial era prior to the time when TEC's predecessor (PECUSA, or the Protestant Episcopal Church in the USA) was founded in 1789, and which was held by individual trustees for their respective benefit, as specifically allowed by Virginia law. (The other three owned no real property.) Under a law unique to Virginia and first enacted in 1867, the eight churches had each filed petitions in December 2006 with their respective circuit courts, together with reports showing the majority votes that had been taken to withdraw, and requesting the courts to approve the reports. Under the terms of the statute, the courts' approval of the respective reports would be "conclusive as to the title and control of any property held" by the trustees for the benefit of the withdrawing congregations. TEC and the Diocese each intervened in these petition proceedings, to assert the same claims which they made in the separate lawsuits they filed a month or so later. In April 2007, all twenty actions (eight brought by the property-owning churches, eleven filed by the Diocese and the one filed by TEC) were ordered consolidated for trial under Judge Bellows.

On February 19, 2007, the Primates gathered at Dar-es-Salaam had issued their now-famous communique which, among other things, called upon the churches in the Anglican Communion to "suspend all actions at law" over church property disputes, pending the response requested of TEC's House of Bishops by September 30, 2007. The churches' attorneys promptly wrote the attorneys for TEC and the Diocese on February 22, and invited them to agree to a standstill in the litigation. (All documents not specifically linked to in this post may be downloaded or viewed---not necessarily by date, I regret to say---at this site. You have to click on the "News Release" tab on the right, then on the "Downloads Home" image, then finally on the "Legal Documents" folder, where they are all listed.) The reply to the request by TEC Chancellor David Booth Beers, dated February 26, 2007, is especially illuminating:
. . .

We think that there can be no dispute that the Episcopal Church is an independent hierarchical religious denomination with subordinate entities through the United States and several other countries. . .
Notice the claim being made here, which should be news to most diocesan chancellors: The Episcopal Church is representing that it is hierarchical, "with subordinate entities through the United States . . ." (emphasis added). And just what might those subordinate entities be? Could Chancellor Beers possibly be referring to Dioceses such as the Diocese of Virginia, which came into existence well before PECUSA, and which was one of the dioceses which met in New York in 1789 and agreed to form PECUSA? Apparently so, and for now we shall only note this claim and return to it when we see how it fared before Judge Bellows. Chancellor Beers continues:
As you also know, at their recent meeting in Tanzania, the Primates expressed concern regarding differences among the leaders and members of the Episcopal Church, largely regarding issues of human sexuality. In that connection, the Primates, while recognizing that steps to deal with these differences within the Church "must be generated with its own life," undertook to offer a number of interrelated "recommendations," one of which dealt with circumstances under which the differing parties could see their way to withdrawing from civil litigation over property matters. All these recommendations, taken together, call for a number of steps to be considered over time by the bishops and other leaders of the Episcopal Church.
(Emphasis supplied.) It fairly oozes with legalese smooth-talk, does it not? And look what has disappeared in the fog: the request for a suspension of the lawsuits pending a response from the House of Bishops expected by September 30 has been transformed into a series of "steps to be considered over time" by not just the bishops, but by "other leaders" of the church---presumably General Convention (which in February 2007 was not due to meet again for another two years and four months)? Who else could the "leaders" of this "hierarchical religious denomination" be, besides the bishops?

Chancellor Beers goes on to recount all the many ways in which the actions of the churches, their rectors and their vestries have violated "numerous rules of the Church and state law," and notes that the Dar-es-Salaam communique called for assurances that no property would be alienated (conveyed away to others) without appropriate consent. He then observes: "The Church is unaware of any movement in this regard on the part of the congregations involved in the pending litigation."

"Movement?" All he has to do is propose a stipulation that there will be no conveyances; the parties can sign it, the court approves it, and there is the requisite "assurance." No, this is not the real reason why TEC will not agree to a standstill. The letter goes on to reveal the true reasons:
In these circumstances, it would be premature, to say the least, for the Church at this time to withdraw from or agree to suspend the litigation, thereby ceasing its efforts to protect its interests and that of its past, current, and future members in seeing that parish property be used for the Church's ministry and mission. Any proposal for such a step should be considered by the Church in connection with all the other recommendations of the Primates' communique that are under consideration by the leaders and other interested persons within the Church, and in the context of developments that may protect the Church's interests in other ways. As noted, this involves a process that will be undertaken over time, in accordance with the rules and procedures of the Church.

Thus, the suspension of this litigation at this time would not be appropriate.
Translation: "A standstill with you will never happen, because there are just too many bishops and 'other interested persons within the Church' [??!] who want this fight to go forward. There is just too much at stake in terms of power, and any one bishop or church chancellor, or even a few of them together, who called for such a step would immediately be branded as cowards in the eyes of their colleagues. See you back in court." (And this interpretation of Mr. Beers's letter was borne out just weeks later, by the pugnacious statements in response to the communique issued from Camp Allen by the House of Bishops.)

Well, here we are now, one year and six months later, and what has this stubborn strategy obtained for TEC and the Diocese of Virginia? The score, by my tally, is currently five to nothing in favor of the withdrawing CANA churches. A quick summary:

1. In November 2007 the parties had a five-day trial on the interpretation of the Virginia Division Statute (see my previous post for its text) and its applicability to the parties in the case. After exhaustive briefing and a full day of oral argument, Judge Bellows issues his first decision against TEC and the Diocese, on April 3, 2008. The decision (88 pages long) provides a thorough review of the recent history in TEC and in the Anglican Communion, concludes that the Diocese and TEC are each a "church" within the meaning of the statute, and that the Anglican Communion itself is a "religious society," if not a church as such. (After the Archbishop of Canterbury's last press conference at Lambeth, Judge Bellows could now cite Dr. Williams in support of a finding that the Anglican Communion is indeed a "church"---and who better to have as an expert?) The decision goes on to find that the CANA congregations are "attached to" (affiliated with) each of these three churches, that CANA, the Church of Nigeria, ECUSA, ADV and the Diocese are all "branches" of the Anglican Communion, and that as a consequence, CANA and ADV are likewise "branches" of ECUSA and the Diocese. Finally, the Court decides, based on the experts it heard, that unquestionably a "division" has occurred in a "church or religious society" (as previously defined) to which the CANA congregations are "attached," and that the division has occurred at all three levels: within the Diocese, within ECUSA, and within the Anglican Communion. Thus the Division Statute on its face applies to the dispute. Score: 1-0 in favor of the CANA congregations.

2. The next question is whether the application of the Statute to the parties would violate either the Virginia or the federal Constitutions. Again, the issues are thoroughly briefed and argued, and again Judge Bellows issues a comprehensive and scholarly opinion of 49 pages that makes hash of the insipid arguments offered up by TEC and the Diocese. The ruling, delivered on June 27, 2008, finds that the Statute does not violate the Free Exercise Clause in the First Amendment, because it is neutral in its operation, and allows a hierarchical church to ensure that its parishes' property will remain with the church no matter what kind of division occurs, if it follows the legal steps necessary to create an ownership interest in the hierarchical entity. Pointedly, Judge Bellows finds that despite years of opportunity to do so since the Division Statute was enacted in 1867, ECUSA and the Diocese failed to make the appropriate legal arrangements with their parishes (and ECUSA and the Diocese virtually conceded that they would have faced stiff resistance in doing so; hence their taking refuge behind the Dennis Canon). Judge Bellows goes on to hold that the Statute does not get the Commonwealth of Virginia into the business of "establishing religions", or of unduly entangling itself with questions of religious doctrine or belief, so that it does not violate the Establishment Clause, either. Nor does its application offend the 14th Amendment's concern for "equal protection of the laws"---he already ruled that the Statute is neutral in its operation, and allows hierarchical churches to function as they wish to operate. And finally, he rules that the operation of the Statute does not produce an unconstitional "taking" of property in violation of the Fifth Amendment (as applied to the States via the 14th Amendment). Score: CANA congregations 2, ECUSA/Diocese 0.

3. In a separate ruling delivered also on June 27, Judge Bellows disposes of five technical points of Virginia law bearing on the interpretation of the Division Statute. He holds that under its terms, his review of the votes taken is limited to whether or not the requirements of the Statute were met, and that the vote was "fairly taken." He also notes that the Statute provides that once he has made that determination, it "shall be conclusive as to the title and control of any property held in trust for such congregation . . .". And finally, he rules that he does not have to look behind the petitions under the Statute themselves to decide who actually "holds title" to the churches' property, so long as the petition shows that it is "held by trustees" as required by the Statute. Score: CANA Congregations 3, ECUSA Diocese 0.

4. These rulings leave still one aspect of the constitutionality of the Division Statute to be decided: whether or not its operation in this case will "impair the obligation of contracts" in violation of Art. I, Sec. 10, cl. 1 of the United States Constitution. That is the subject of the first of the rulings Judge Bellows issued on August 19, 2008. (Incidentally, the date of this ruling, following supplemental briefs by the parties following another day of oral argument held just on August 11, shows the considerable effort that Judge Bellows is putting into this case: he delivers another 32 pages of rulings a mere number of days after getting supplemental briefs---which he called for on questions that he had raised, not the parties, at the oral argument 8 days earlier.) He once again makes mincemeat of the TEC/Diocese arguments, some of which are palpably ridiculous (charitably, Judge Bellows refers to them as "rather ambitious"). In essence, TEC had nothing like a Dennis Canon in 1867 when the Statute was first enacted, and Judge Bellows holds that the Statute therefore takes precedence over any contractual arrangement between the Diocese and a parish that was entered into after that date. Thus ECUSA's Dennis Canon cannot trump the Statute without ECUSA taking steps beyond the Canon itself to set up a proper and legal trust arrangement:
Vested rights in property cannot lie where the property itself has not been acquired as of the date of the supposed vesting. Nor can ECUSA/Diocese convert or transmute property acquired after 1867 into property treated as it it was acquired prior to 1867, even by reference to ECUSA/Diocese's constitution or canons. The Contracts Clause limits the power of the state to impair contract rights. It is not alchemy.
(Ruling at p. 11; footnote omitted, in which the court points out that to try to construe the Dennis Canon (as urged by the Diocese/TEC), so as to achieve the transmutation of property titles into a trust for the Church, would be much more likely to entangle the court in the questions of religious doctrine and of hierarchical governance that TEC and the Diocese have all along contended the court must avoid! And that takes care of Chancellor Beers's argument that the "hierarchical nature" of TEC trumps the Division Statute.) So the application of the Division Statute has been found to be fully constitutional on all points raised by TEC and the Diocese, and the Commonwealth of Virginia's role in the case can now cease (to be resumed on any appeal). Score: CANA congregations 4, TEC/Diocese 0.

5. This leaves the most incredible ruling of all, also handed down on August 19---incredible, not because of the ruling itself, but because TEC and the Diocese had the chutzpah to require Judge Bellows to make it. In essence, what they tried to do, after they lost rulings 1, 2 and 3 above, was to go back to the very beginning of the case and argue that the entire proceedings since that time had been entirely in vain---over 180 pages of detailed rulings, countless hundreds of thousands of dollars poured into legal research, briefs and argument, and five full days of trial. Why in vain? Well, because TEC's and the Diocese's lawyers thought of a brand-new argument they ought to have been---and rather ludicrously claimed they had been---making all along: Rather than contend (as they had up to this point) that TEC's and the Diocese's constitutions and canons prevented the churches from leaving as they did, and from invoking the Division Statute, now they wanted to be able to show that those same churches had voluntarily waived the protections of the Statute. (Presumably they wanted to make the same arguments as before about the effect of their constitutions and canons, since no one has mentioned anything about a written, knowing, and fully executed and notarized waiver document.) Needless to say, the court made short shrift of this outlandish request, given all the money and resources that had been spent to date, and with the end nearly in sight. Score at this time, therefore: 5-0 in favor of the CANA congregations.

What does this leave for the trial scheduled for October? Judge Bellows also issued an order calling for counsel to come to his courtroom on August 22 at 2:00 p.m. to discuss that very point. I have no inside information here, and there will be many who are closer to the events who can speak to this more knowledgeably, but it seems to me that the case is just about over as to the eight CANA churches who filed their petitions. In accordance with the ruling discussed in Item No. 3 above, all Judge Bellows will require of them is that they prove the facts alleged in their petitions: that they are each a church whose property is held by trustees, formerly attached to a branch of ECUSA, that in light of the division that the Judge already found has occurred, they each took a duly recorded vote in which all of their membership had an opportunity to take part, that the vote was fair in all respects, and that the majority decided to leave with the property. End of proof: the judge approves the vote, and that approval is "conclusive as to the title and control of [the] property . . .". End of case, and next: to the Virginia Supreme Court [UPDATE 08/20/2008: not first to the court of appeals, as in most other states: see the helpful comment of Jeff H. below], and then a request for review to the United States Supreme Court, no matter who loses. We are years away from any final resolution in this matter. And the three churches who do not own any real property will have to proceed to trial without having the benefit of the Division Statute. But because they have no real property, presumably the only argument is about bank accounts, and maybe some hymnals and prayer books---all of which should be replaceable in the event the Dennis Canon rears its ugly head.

What is so disheartening to note is the gulf that existed between the supremely confident views of TEC as expressed by its Chancellor in the February 2007 letter quoted at the outset above, and the reception of TEC's actual justifications for those views offered to Judge Bellows, who is a very sharp and competent judge. Chancellor Beers has had his day in court, and then some; he did not put forth even one argument that caused the Judge any difficulty in wrestling with the plain terms of the Statute, and with what little precedent under it there was to argue. The CANA lawyers had the much better side of the argument; time and again, Judge Bellows quotes from their briefs the perfect riposte to a half-hearted or poorly thought-out contention raised by the TEC attorneys. But Judge Bellows is also perfectly capable of handling the arguments by himself, as he demonstrated when he gave TEC even further opportunity to develop their points beyond where they themselves had thought to take them.

At this juncture, therefore, I am moved to quote Horace (or was it Plutarch?):


  1. Mr. Haley,

    Excellent summary, and much appreciated.

    As to the inevitable appeal, I've been trying to point this out wherever possible, but in Virginia, standard civil cases are appealed directly to the Supreme Court of Virginia, not to the state court of appeals, which hears only criminal appeals and certain civil appeals (not including this one).

    From the Court of Appeals website:


    The Court of Appeals has authority to hear appeals as a matter of right from:

    * any final judgment, order, or decree of a circuit court involving affirmance or annulment of a marriage, divorce, custody, spousal or child support, or control or disposition of a child, as well as other domestic relations cases;
    * any final decision of the Virginia Workers' Compensation Commission (a state agency responsible for handling workers' compensation claims);
    * any final decision of a circuit court on appeal from a decision of an administrative agency (example: the Department of Health); and
    * any interlocutory order granting, dissolving, or denying an injunction or adjudicating the principles of a cause in any of the cases listed above.

    The Court of Appeals has authority to consider petitions for appeal from:

    * final orders of conviction in criminal and traffic matters except where a death penalty is imposed.
    * final decisions of a circuit court on an application for a concealed weapons permit.
    * certain preliminary rulings in felony cases when requested by the Commonwealth.

    The Court of Appeals has original jurisdiction to issue writs of mandamus, prohibition and habeas corpus in any case over which the Court would have appellate jurisdiction.

    In addition, the Court of Appeals has original jurisdiction to issue a writ of actual innocence upon petition of a person who has been convicted of a felony.

  2. Thank you very much for that correction, Jeff H - I will add an update in the body. So the situation in Virginia is just the opposite from what it is in California and a lot of other States, where appeals must be heard by the intermediate courts of appeal, but do not have to be heard, except as it may choose to do so in any given case, by the State's Supreme Court. That must make for a very busy Virginia Supreme Court!

  3. Thanks for your wonderful commentaries.

    From the terse, two short paragraph comment released by the Diocese of Virginia it seems events are chaffing tender areas in Richmond.

    It is common on appeal for defendants to claim they were ill-served by incompetent counsel. Is there any potential for an appeal that contains a claim of incompetent plaintiff's counsel? Seems ridiculous on its face, but there seems to be no straw plaintiff won't lunge for in this case.

  4. Rick, thank you---no, that claim only works in criminal cases, as a means of getting the appellate court to order a new trial. In civil cases, your only remedy is to sue for damages for malpractice---but then you have to prove that the outcome would have been different with proper counsel at your side, and that is a very difficult burden to meet.

    For the record, I do not see TEC's or the Diocese's counsel as incompetent, but just not exercising any kind of judgment at all about the arguments they choose to press on the court. Perhaps since, as Jeff points out in the comment above, review at a higher level than Judge Bellows will be discretionary, the attorneys are simply trying to throw as much into the record as possible in order to give them the maximum grounds to argue on appeal. But that is not a strategy designed to win favor with the trial court.

  5. Great review. Just one correction - CANA is Convocation of Anglicans in North America (a Mission of the Church of Nigeria (Anglican Communion).


  6. One more thing - I'm not sure about this section of when we filed our petitions, that we also were "requesting the courts to declare that the respective trustees held the titles to the properties for the benefit of the withdrawing congregations." As I recall we didn't do that, we only filed our votes. We assumed we had title, we didn't need to ask the court to do that for us.

    Also, as I recall we didn't do that second part because we thought we were going into negotiations with Bishop Lee. Bishop Lee had established his "Property Committee" which was to handle the negotiation-phase of his protocol that we followed. We had gotten as far as electing our representatives when Bishop Lee called it all off and sued us, joined a few days later by the Episcopal Church which initially filed separate lawsuits.

    You might want to verify what I've written.


  7. Thanks, bb - it's fixed. (I worked way too late into the night on this.) I'm also grateful for your keeping us up to date with the situation on the ground there.

  8. It seems to me that since (a) the Diocese is well on its way to losing, (b) this litigation was forced by 815 when the Diocese was in negotiations with the departing parishes on the subject of property ownership and (c) as a result the Diocese has incurred significant legal fees all forced upon it by 815, that the Diocese should send 815 a bill for its legal expenses at the conclusion of this litigation, and if they don't agree to reimburse the Diocese, the Diocese should sue! Take that KJS!