Some concerns have been raised about the effect of the settlement on the other cases now pending before the U. S. Supreme Court. The settlement need not have any effect at all, and we probably won't know in any event whether the Court will accept either of the remaining two cases until next October 1. Let me explain my thinking.
The settlement between Christ Church Anglican and the Diocese of Georgia affects only one of the three petitions that are pending before the Supreme Court. The Diocese had been due to file a response to the petition by May 25; now it will not do so, and the justices will not read the briefs that have already been filed (Christ Church's brief, and two amicus briefs filed on its behalf). But there are similar briefs, and similar amicus briefs, on file and to be filed in the other two cases -- and the issues are virtually identical: can a national church bypass state-law trust requirements to impose a trust on all of its local parish properties? And if it can, is that not a violation of the First Amendment's prohibition against the "establishment" of a church (i.e., favoring it in the law)?
The parties to the Christ Church case each had strong motives to reach a settlement at this juncture, before the Supreme Court acted on the petition for review. For the Diocese of Georgia, a decision to grant review could have spelled big trouble for the Dennis Canon as an enforcement tool -- even before the Supreme Court heard arguments and published a decision, parishes might have been encouraged to try to leave while assuming that the special treatment the Canon had received in the courts would be brought to an end. Now, with the petition dismissed, if the Court disavows the Dennis Canon as a trust creation tool, it will happen in the context of another State's laws (Connecticut's). And that would leave some wiggle room to argue that Georgia law was somehow or uniquely "different" -- at least, until the Georgia Supreme Court took another Episcopal church case.
For Christ Church, its rector and vestry, the petition to the Supreme Court was a slender straw on which to lean -- most such petitions end up being denied without comment. And if the petition had been denied, then the Diocese's lawsuit against the rector and vestry personally would have proceeded in the Georgia courts. (Actually, it would have proceeded regardless of how the Court acted on the petition. It takes a vote of just four of the nine justices to accept a case for review, and the final position of the eventual majority of five or more justices would not be known for possibly a year or more, until the Court published its decision. Thus during that year, the Diocese would still have been free to try to reduce its lawsuit against the rector and vestry of Christ Church to a judgment.)
That separate lawsuit sought to establish personal liability on the part of the rector and vestry members for the $1 million-plus which the Diocese and ECUSA claimed they had spent of the Church's funds on defending the principal lawsuit. Under the Dennis Canon trust (which purports to apply to all personal, as well as to the real, property of a parish), the parish's money could be used on legal matters only as long as Christ Church Savannah remained in the Diocese of Georgia. Once it voted to leave, the claim was that it had to keep all pledge money and other donations accumulated up to that point in trust, for the Diocese, pending the outcome of the lawsuit. But since the rector and vestry had voted to use that money for legal defense, the Diocese wanted them personally to pay it all back.
So that was a huge burden lifted from their backs. And in order to induce them to settle before the Court could act on their petition, the Diocese and Bishop Benhase reduced their other demands, as well. They agreed that the parish could form a new corporation and call itself "Christ Church Anglican"; they agreed to assume a mortgage which Christ Church had placed on its property, and in exchange for surrendering the endowment funds (which could not be used for current expenses anyway), the Diocese asked only that they turn over $33,000 of the cash that was on hand when they voted to leave. (That amount is the same as the amount they would have had to use to pay off the mortgage, if the Diocese had not agreed to assume it.) Finally, the Anglican parish retained the rights to one of their major ministries -- an annual tour they organize and staff of historic homes of Savannah, which is an important source of donations.
Phil Ashey of the American Anglican Council, who knows the parish and its members well, summed up the result achieved in these words:
This was a very difficult for Christ Church Savannah. We should note that after they filed their writ with the U.S. Supreme Court, the Episcopal Diocese of Georgia significantly lowered their demands in such a way that Christ Church Savannah now pays net zero to the diocese, walks away with the name "Christ Church Anglican," the right to cliam publically their lineage to the first Anglicans in Savannah, their tour of homes ministry in Savannah, and with no further claims on the church or any individual vestry members.I mentioned above that the Diocese of Georgia had sought and obtained an extension of time within which to file their response to Christ Church's petition. The parties to the other cases before the Supreme Court have also each sought extensions -- the response in the Timberridge case will not be filed until May 9, and the responsive brief in the Bishop Seabury case is not due until May 18. The petitioners then have the opportunity to file replies, after which all the briefs are circulated to the Justices for them to take up at one of their Thursday conferences. However, the last conference scheduled on the Court's calendar for this term is Thursday, May 31; no conferences are scheduled in June, which is the month the justices use to finish up opinions in all of the cases argued up to that point (not the least of which are the Obamacare appeals).
If past practice is any guide, neither the Timberridge briefs nor the Bishop Seabury briefs will be put out for distribution for the May 31 conference (even if the replies are on file by then), because of the backlog of earlier cases already scheduled for that conference. What will most likely happen, then, is that the briefs will be part of the justices' summer recess packages. They will then take up all the cases briefed in May through August at their first conference of the fall (not yet officially scheduled, but probably on September 27).
We will most likely not have any idea of whether or not four (or more) justices think the questions raised by the Timberridge and Bishop Seabury petitions are worthy of their attention until the first Monday in October, when the Court officially begins its 2012-2013 Term. And that is why the parties in Christ Church settled. Neither side could afford to wait that long to find out what the Court is going to do.
[UPDATE 05/04/2012: A reader writes to correct the foregoing -- it turns out that there are case conferences scheduled for June, even though they do not yet show up on the calendar at SCOTUSblog, which was my source for writing the above. The original Case Distribution Schedule fixed at the start of the term shows that cases whose briefing is completed by June 4 would expect to be considered at the Court's last conference of the term, shown as scheduled for June 21. (By Rule 15.5, the Clerk of the Court waits at least 10 days from the filing of the respondent's brief before distributing all the briefs to the justices -- thus the petitioners have ten days to get any reply brief on file, if they want the justices to see it.) With the Timberridge response due by May 9, the ten-day period will be up by May 19, and so the briefs in that case could be distributed as early as May 22 for the June 7 conference, or perhaps May 29 for the June 14 conference. The Bishop Seabury briefs could be sent out to the justices as early as May 29 as well, but perhaps might be held until June 5, for consideration at the June 21 conference.
There is no requirement that the cases be considered at the same conference, although any justice who is interested in them could request it. The Court also sometimes decides to hold over a case brought up at one conference to the next one, and it could do that in order to consider both cases at the conferences of either June 14 or June 21. The only way to know for sure will be to check the docket sheets for each case (linked above, in the discussion about brief due dates). Once the briefs have been distributed for a specific conference, that fact will be shown on the docket sheet for that case.
The results of the justices' deliberations in conference on Thursdays are typically announced by the clerk at 10:00 a.m. the following Monday. Thus we could know whether or not the Court is going to look favorably on these petitions as early as June 11, or if not, then by June 18 or 25.]
A point of clarification is needed. The rector and vestry were personally sued immediately after the Christ Church voted to leave TEC five years ago. None of the subsequent rulings addressed the issue. As soon as the Anglicans vacated all real estate, property (e.g., vestments) and relinquished the frozen endowment, the Episcopalians filed a contempt motion, sued for additional damages, made further demands on the Anglicans and renewed their commitment to sue the rector and members of the parish personally.
ReplyDeleteThank you for mentioning that the Diocese of GA and the Episcopal Church had personally sued the CCA rector and vestry. Unfortunately, this outrageous fact is not widely known, even in Savannah!
ReplyDeleteYou mentioned that the Diocese of GA and the congregation calling itself Christ Church Episcopal could not legally use the endowment funds except for limited purposes. The building on Johnson Square is almost 200 years old and is very costly to maintain. The small congregation that now controls the building, and the cash-strapped Dio GA will certainly wish to be able to access those funds. I expect the Dio GA will try to raise cash by moving some of the small other episcopal parish congregations into the Johnson Square building and attempting to sell or rent their facilities.
homeward, thank you for those additional details. I did not intend to imply that the suit by the Diocese for personal liability against the rector and vestry was only a recent maneuver. The fact remains is that its object was to hold them personally accountable for most of the money spent by the parish in the years since it voted to leave -- and that their greatest expense item was defending against the litigation the Diocese itself had brought against them.
ReplyDeleteThe Dennis Canon allows parishes to spend their assets freely on parish purposes so long as they are still in ECUSA. It is only when there is a vote to leave that the Canon's "enforcers" try to argue that the parish cannot spend any of its accumulated or reserve funds to defend themselves. But they cannot argue about moneys spent for routine maintenance and upkeep, since that would have had to be spent whether the parish was still in ECUSA or not.
sophy0075, I hope there are still descendants around to enforce the terms of the endowment funds, or that the Georgia Attorney General can be persuaded to look into how the Diocese decides to use them, once they are under its control.
ReplyDeleteMost endowment funds are restricted so that only their current income may be used for operating expenses, such as maintenance and upkeep. It would be improper under such restrictions to use principal for that purpose. But those of you who are closer to the scene will best be able to look into the details, and to police how the Diocese tries to tap into the funds.
Dear Mr. Haley,
ReplyDeleteIn my somewhat hastily written letter of 26 September 2008 resigning my membership in The Episcopal Church and my Episcopal parish I unambiguously characterized the actions of some of the leadership of the Episcopal Church, including the current Presiding Bishop, as "lawless." I stand by that analysis to the present day, and extend it to the further subsequent actions of TEC and the Episcopal Bishop of Georgia, as similarly deceitful and lawless.
In my estimation, the actions of the Diocese of Georgia, whether in concert with the Presiding Bishop or not, in using the patently deceitful, and possibly fictive, Dennis Canon, coupled with lawsuits against individual Vestry members, which are transparently obvious acts of punitive coercion, are yet further examples of the unChristian and lawless nature of the current leadership of the Episcopal Church.
It saddens me to see such vengeful brigands triumph at the expense of the faithful parishioners of any formerly Episcopal parish, and I pray fervently that the faithful will be granted some measure of safety, peace and recompense by our Lord in return for the tribulation visited upon them by such unrighteous "leaders."
Pax et bonum,
Keith Töpfer
The vestry was sued personally for one reason. The articles of incorporation were changed by the legal counsel of the breakaway congregation to actually hold title to the property personally in the name of the vestry members....resulting in them being personally responsible in any litigation. Not such a smart legal move. But if they held ownership they were the rightful parties to be sued.....
ReplyDeleteplaintiff, I challenge you to produce proof of your assertion. Th opinion of the Georgia Supreme Court (p. 38) recites as fact only that:
ReplyDelete"Then, on March 30, 2006, without advance notice to the Bishop, the wardens and a majority of the vestry voted to amend Christ Church’s Articles of Incorporation. On April 10, 2006, Articles of Amendment were filed with the Georgia Secretary of State that removed all references to the Episcopal Church and the Georgia Diocese and stated that the 1918 and 1923 amendments to the 1789 charter were 'repealed and annulled.'”
I can find no reference in the reported decisions to the facts which you allege. It would be worthwhile to see a copy of the actual complaint filed by the Diocese and ECUSA against the rector and vestry.
If you research the Georgia Corporation's you can find the articles of incorporation that change the way the property was held. It was now under an amended articles of corporation that held "vestry shall have charge of affairs, property and assets" ...etc. Even the lower court ruling made reference to that fact and stated they could not amend their way out of the long standing articles of incorporation just like you cannot amend your way out of a mortgage.
ReplyDeleteOnce Neil Creasy amended the articles of incorporation changing the way the property was held in 2006 he made the vestry personally liable for the property, assets, etc and with that they became personally liable for any lawsuits or allegations of wrong-doing. It worked both ways.
It was not a personal attack but their own legal counsel put them in that position.
Why not question where all of the endowment funds went? Are you aware of the malpractice claims against the attorney in charge of this whole thing? He has two pending lawsuits against him, both alleging mismanagement of client funds?
Coincidence?
Criminal attorneys got involved in the contempt action? Why? Why not account for the endowment funds? How much went to the lawyer that led this? Can you take property (endowment fund) that was at the time "unresolved" as to who the proper owner was and put that money towards legal fees?
There is a much bigger story here.....this is about one thing.....money. And the lawyer that led this is where you need to do your research.
Page 15, order on cross motion for summary judgement is where you will find this. This was in 2006. The Diocese did not sue until the next year - after they found out that the break away congregation had amended the articles of incorporation as to how the property was held.
ReplyDeleteSo yelling and screaming that the Diocese was aggressive and sued the vestry was just not factual.
The vestry and lawyer in 2006 just took control of the property at that time by amending the long standing articles of incorporation! That is just insane! The Diocese merely asked for it back....and won...over and over again...but not until almost $1,000,000 went "missing". (or so that is the number that is being thrown out there)
Does this help?
Plaintiff, I have published your comments in response to my challenge so that others more familiar with the facts and the history of the proceedings can take issue with them, if they choose.
ReplyDeleteI take note of the fact that the amended articles put the vestry "in charge of" the parish's assets, including the endowment fund. That is not the same thing as putting legal title to those assets in the names of the individual vestry members.
A corporation holds legal title to its assets. A vestry is like a corporation's board of directors. The board manages and controls the assets, because it manages and controls the day-to-day affairs of the corporation. But if you want to take back possession of the assets under some trust claim, you do not sue the vestry members individually; you sue the parish corporation, which holds legal title.
Likewise, if there are any claims about dissipating those assets while the corporation was under the control of a given vestry, then those claims have to be brought by the corporation against the defalcating directors, and not by ECUSA or the Diocese. And if, as I understand it, the Diocese now has the parish corporation back in its fold, then it must have agreed to relinquish any such claims when it reached its settlement with the departing congregation -- which included all of the individual defendants.
Was there a motion filed claiming the "wrong party in interest" was being sued or was there any motion filed to dismiss the suit claiming the plaintiff was not the real party in interest?
ReplyDeleteI think if there was any merit to that argument that would have been the first motion filed as suing the wrong party or the wrong party having no standing is a sure way to get your case dismissed before it ever gets started.
Plaintiff, we are engaged right now in disputing that identical point in the suits brought by the faux Diocese of San Joaquin against the parish corporation -- and also their rectors and vestry members, individually.
ReplyDeleteOne judge -- in one of the nine cases -- dismissed the suit against the individuals. That's one out of nine, so far -- and the plaintiffs have taken that decision up on appeal! Motions in two more cases are pending, and even if the plaintiffs lose them, they will appeal again, because their motive is to punish, and not just to regain property.
But that is why I say we should let someone who was involved closely with the CC litigation explain just what happened there. Without all the actual court files, it's very difficult to tell.