San Joaquin: Case Closed

Earl Warren Building and Courthouse, San Francisco • Wikimedia Commons

By G. Jeffrey MacDonald

The Episcopal Church won a massive legal victory worth an estimated $50 million Wednesday when the California Supreme Court declined to hear an appeal from the breakaway Anglican Diocese of San Joaquin.

The court action brings an end to eight years of litigation that pitted Episcopalians against former Episcopalians and cost millions in legal fees. The Anglican diocese will comply with the ruling and vacate the 28 properties involved in the case, said the Rt. Rev. Eric Menees, its bishop since 2011.

“I’m not going to take the Episcopal Church to court,” Menees said two days before the ruling as he considered the prospect of no review by the court. “I’m not going to do anything other than work with them to hand over the properties.”

Now the Episcopal Church is poised to reclaim assets across California’s Central Valley from Fresno to Bakersfield, Modesto, and San Rafael. Assets at stake include investments, such as those in endowment portfolios, as well as a crown jewel of real estate: Evergreen Conference Center, Oakhurst, located 12 miles from Yosemite National Park.

Meanwhile, congregations now affiliated with the Anglican Church in North America are gearing up to use backup plans they hoped to never need. They will be moving out, Menees said, and into other facilities that have agreed to take them as tenants.

Ministries will continue, Menees said, but outreach will be hampered as congregations move further away from the neighbors they have been serving. Among those bracing for the transition is St. James Cathedral in Fresno, where a Spanish-speaking community has swelled almost 20-fold from 50 in 2008 to 950 today.

“It’s going to be hard to find a place that’s large enough to accommodate them,” Menees said.

“We are thankful for this outcome, which brings relief and clarity to the faithful people in the Diocese of San Joaquin and the wider Episcopal Church,” said Rev. Canon Michael Buerkel Hunn, canon to the presiding bishop for ministry within the Episcopal Church.

He declined to say whether the church will plant congregations in the reclaimed properties or sell them off.

“We will continue to bear witness to the good news of God in Jesus Christ using all that we have and all that we are here and throughout the world,” he said.

The court action lets stand an April decision from the Fifth District Appellate Court in favor of the Episcopal Church. That court found that the late Bishop John-David Schofield and the diocesan convention had failed to comply with the Episcopal Church’s canons when attempting to transfer properties.

“Because the amendment changing the name of the corporation sole to The Anglican Bishop of San Joaquin was invalid, no corporation sole known as The Anglican Bishop of San Joaquin existed when these deeds were executed and recorded,” the April decision said. “Title cannot be held by an entity that does not exist. Therefore, these deeds were a nullity.”

The newly formed Anglican Diocese of San Joaquin laid claim to the assets when it moved to disaffiliate in 2008, arguing that the Episcopal Church had abandoned its theological foundations and effectively naming itself the rightful heir.

The episode was one of several playing out around the country as congregations and dioceses left the Episcopal Church after the 2003 consecration of an openly gay bishop, the Rt. Rev. Gene Robinson of New Hampshire.

The Anglican Diocese of San Joaquin spent $1.5 million on legal fees to defend its claim to the assets, Menees said.

“From our perspective, they are confiscating properties that belong to the people who are in them, who built them, who did all of that,” Menees said. The diocese might consider buying the properties it has long occupied, he said, but he doesn’t expect Anglican buyers would be entertained. Plus, it would be hard to swallow.

“That would be like someone coming in and stealing your TV set and then offering to sell it back to you,” Menees said.

More than 90 percent of the congregations that had once comprised the Episcopal Diocese of San Joaquin severed their Episcopal ties and joined the Anglican Church in North America.

Wednesday’s win marks a success for the Episcopal Church, which continues to battle with breakaway dioceses for control of properties in Fort Worth and South Carolina. But the California case could portend more litigation ahead in other breakaway cases, experts say.

Though the Episcopal Church prevailed in San Joaquin, traditional legal underpinnings for Episcopal victories in similar disputes were dislodged. The California courts opted not to use “deference principles,” which acknowledge the church’s hierarchy as a determining factor and tend to support the notion of national church ownership of local properties. Instead, California invoked “neutral principles,” which focus on contractual documents such as deeds, charters, and signed agreements.

The appellate court dismissed as untenable the Episcopal Church’s longstanding argument that a diocese holds property for the national church through an implied trust. That argument received a fatal blow.

“Courts will not imply a trust on church property,” the appellate court wrote in its 23-page decision. “Implying a trust almost inevitably puts the civil courts squarely in the midst of ecclesiastical controversies. … The court would be required to determine which faction continued to adhere to the ‘true’ faith. This is something a civil court is not permitted to do.”

The Episcopal Church keeps the San Joaquin assets, but for a different reason: the Anglican diocese did not follow proper procedures when attempting to transfer property.

“The diocese had to follow its own rules, and it didn’t follow its own rules at the time that it chose to leave the Episcopal Church,” said Bob Tuttle, professor of law and religion at George Washington University Law School.

With that ruling, California went where other courts have been reluctant to tread for fear of breaching the principle of separation of church and state.

Tuttle says the courts have learned, in a decade that has seen breakaway cases from the Diocese of Quincy (Illinois) to Fort Worth, Pittsburgh, and South Carolina, that justices are not meddling in theological debates when they refer to church documents. They are merely doing what they do in routinely resolving civil cases — that is, verifying whether an organization is acting in accordance with its charter and professed procedures.

Tuttle sees the ruling as a positive step toward establishing a consistent standard and method for adjudicating cases in which a parish or diocese leaves a denomination. It could have implications for other cases, he said, including those involving Presbyterian Church (U.S.A.) breakaway churches in California.

Meanwhile, courts in other states where Episcopal cases are pending are apt to take notice. “It’s not simply folks fighting about property,” Tuttle said. “What they are really fighting about is who gets to be, and exercise the authority of, the church in a particular place.”

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