Dust-up in Fort Worth over All Saints

As I reported at the end of this post, Bishop Iker made an overture to the congregation of All Saints in the rump diocese to use the dispute resolution process of diocesan Canon 32 to reach a settlement as to which faction of All Saints parish would remain in control of the property

As I reported at the end of this post, Bishop Iker made an overture to the congregation of All Saints in the rump diocese to use the dispute resolution process of diocesan Canon 32 to reach a settlement as to which faction of All Saints parish would remain in control of the property. Well, the lawyers got hold of the proposal, and you can predict what happened: “Use Christian methods to resolve a dispute among Christians, as St. Paul directed us? No way! We prefer the secular courts, thank you!”

Here is Bishop Iker’s initial letter to the congregation, and here is the response by ECUSA’s (and the rump faction’s) attorneys. Finally, here is the reply to the attorneys’ letter sent by (as is required in such cases) Bishop Iker’s attorney. Let me try to translate some of the legalese for the benefit of lay participants. 

At the hearing on the motions for summary judgment, Judge Chupp took note of the Canon 32 dispute resolution process and suggested that the parties might follow it. According to the account at Bishop Iker’s website:

During oral argument by attorney Frank Hill, who represented the plaintiff parishes, Judge Chupp decided to sever out the claims of All Saints’, Fort Worth, for a separate jury trial this spring. As an alternative, the judge urged Mr. Hill several times to opt instead for a settlement under diocesan Canon 32, which sets out a procedure to follow in cases where a parish wishes to separate from the Diocese. Though Mr. Hill expressed his belief that the Diocese would not have given the parish a favorable settlement at any time from 2008 to the present, the judge chided him, saying, “But you didn’t even try.”

Now we learn from Mr. Leatherbury’s response to Bishop Iker that Judge Chupp also suggested mediation, and that the attorneys discussed the name of a potential mediator. As frequently happens in these matters, mediation with that particular mediator was not acceptable to one of the two sides, and while the reply to Mr. Leatherbury by R. David Weaver does not propose a different mediator, it leaves open the possibility of mediation, and instead proposes first that the parties engage in some limited discovery as to the All Saints property issues.

(My understanding of this matter is limited to the court filings and to my sources, and I would welcome any contributions to the facts in the comments.) The Canons of the original Episcopal Diocese of Fort Worth allow  member parishes to form separate corporations, but under certain conditions. One such condition is that the parish corporation not take title to any real property in its own name, but that all real property of the parish be held in the name of the Diocesan corporation, as required by Art. XIV of the Diocesan constitution. All Saints is one parish in Fort Worth that had incorporated in 1953, while it was still in the Diocese of Dallas, and both it and its property moved to the Fort Worth Diocese when that entity came into union with General Convention in 1982. 

My understanding is that Bishop Iker’s diocesan corporation does hold title to the two parcels of real property on which the church and accessory buildings of All Saints are situated. However, the parish in the intervening years acquired several parcels of nearby property to make more room. Of these, three are held simply in the name of the parish itself, while one (used for a curate’s home) was acquired in the name of the parish corporation, despite the provisions of Canon 31 linked above. (The church also uses another parcel about 7 miles away for “All Saints School.” The school is run as a separate corporation, and its ownership of the property is not at issue in the lawsuit.) So when the dispute started, Bishop Iker offered to facilitate the use of Canon 32 to untangle which entity would take title to which pieces of property, and as I noted in my earlier post, the rump faction’s attorney, Mr. Frank Hill, angrily rejected that overture. Moreover, under Mr. Hill’s guidance, the parish proceeded to conduct a one-sided vote (from which all those who supported Bishop Iker were excluded by the requirement of a signed “loyalty oath”) so it could claim it “overwhelmingly” had decided to remain in ECUSA.

Bishop Iker’s latest request was thus simply an attempt to go back to ground zero, before Mr. Hill started drawing the battle lines, and to take the real pulse of the entire All Saints congregation in order to arrive at an amicable, Paulian-motivated settlement of the dispute. The rump faction at All Saints once again has spurned any such resolution — acting, no doubt, in unity with ECUSA and its attorneys.

And so we see that little has changed, despite Bishop Iker’s success in the underlying lawsuit. The attorneys have agreed on some procedures to expedite the resolution or trial, if necessary, of the All Saints case, and there remain still other matters which the parties can address by means of further partial summary judgment motions. No one seems to think that there are any material disputed facts.

The ECUSA parties have announced their intention to appeal Judge Chupp’s decision, but all of these secondary issues have to be resolved first so that a final judgment can be entered, as I explained in the preceding post. Given the Supreme Court’s prior rulings in the Fort Worth and San Angelo cases, however, I foresee little chance that any Court of Appeals will reverse Judge Chupp. If the Ft. Worth Court of Appeals affirms his decision, then there will be no reason for the Texas Supreme Court to grant review, and ECUSA will be left to its remedies with the United States Supreme Court — which thus far has turned down every single Episcopal church property case it has been asked to review.

Let’s review, then, where we are from the standpoint of just the All Saints case:

1. The deeds to all the parish property are in the name of the diocesan corporation governed by Bishop Iker and his trustees. The parish corporation has title only to its school property.  

2. The parish corporation, however, decided to remain with ECUSA — after a vote whose outcome was strictly regulated from the start.

3. Meanwhile, the remainder of the congregation loyal to Bishop Iker organized as a separate parish, and is meeting in a separate building nearby each Sunday.

4. The trademark infringement lawsuits filed against Bishop Iker in Texas federal district court (including one brought separately by the rump All Saints parish) have each been dismissed by that court, based on the ruling by the Texas Supreme Court. Judge Chupp has yet to deal with the state-law trademark issues left in his case.

Given these starting points, it seems reasonable to anticipate that Bishop Iker and his diocese will retain the rights to the use of the name “Episcopal Diocese of Fort Worth,” because all the Texas courts to date have recognized his corporation as the entity which has owned that name and its marks since its formation, and Judge Chupp’s latest ruling held that neither ECUSA nor its rump group had any right to elect or control the officers and directors of that entity.

And that entity holds title to the great majority of the All Saints property. It would seem, therefore, that this is a perfectly proper situation in which to invoke Canon 32. The parish corporation (controlled for now by the rump faction) could decide under that Canon, for instance, if it wanted to purchase its property from Bishop Iker’s corporation. Or else it could agree to rent the buildings from the diocesan corporation.

Given neutral principles, and the specific ruling that Bishop Iker’s group effectively revoked the Dennis Canon as to its parish properties, I do not see how the All Saints parish corporation can prove it has any outright claim to the real property held by the Diocese, unless and until it shows that it also followed Texas law in deciding who should control the corporation. Then itmight be able to convince a court that it is the entity for which the diocesan corporation holds the property in trust, and if so, the only question is whether any compensation should be paid. (In effect, the court would take the place of Bishop Iker in applying the provisions of Canon 32.)

If the parish congregation followed applicable Texas religious corporation law in holding the vote and in controlling who was entitled to take part, then control of the parish corporation (and its name) would remain with the rump group, even under Judge Chupp’s latest decision. But if the vestry and rector of All Saints improperly excluded parishioners from voting on the basis of their alleged “disloyalty,” then the vote itself was improper and could be set aside. The question will then turn on who should have been able to vote, under a proper neutral principles of law analysis.

And there the issue gets very murky indeed, because we are six years down the line from when the vote was held. How could a proper vote now be taken, even if the court were willing to supervise it? What happens to the people who were driven away by the dispute, and have joined other churches?  How does one treat the people who have joined each faction in the years since?

These are all good reasons why the secular courts are not the best vehicles to resolve church property disputes. It seems as though a settlement which divided up the parish assets might be a pretty good outcome under these circumstances. Let’s hope that all the lawyering and posturing does not get in the way of good sense and Christian charity. 

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