Mere Anglicanism

Fifth District Holds that Minority Controls Corp Sole

The Fifth District Court of Appeals in Fresno, California ruled that although “the trial court made several errors in its analysis of the case”, it would nevertheless affirm that court’s decision to turn over all the disputed property of the former Diocese of San Joaquin to the remnant Episcopal Diocese of San Joaquin

In a rather contorted opinion published today, the Fifth District Court of Appeals in Fresno, California ruled that although “the trial court made several errors in its analysis of the case”, it would nevertheless affirm that court’s decision to turn over all the disputed property of the former Diocese of San Joaquin to the remnant Episcopal Diocese of San Joaquin first organized in March 2008 after its predecessor voted to leave the Episcopal Church (USA).

In so deciding, the Court of Appeals first rejected the contention that ECUSA and its remnant group were collaterally bound by the final decision of the Illinois Court of Appeals rendered last year, which reached the opposite result for the Anglican Diocese of Quincy. It did not consider the Illinois case to be on all fours with this one, because the title to the church property in Illinois was held by an Illinois not-for-profit corporation, while in the San Joaquin case, the title was held by a California corporation sole.

With all due respect, this is a distinction without a difference. A corporation sole is every bit as much a religious organization as a religious not-for-profit corporation. The key question in the California case is: which diocese — the Anglican one that withdrew from ECUSA in December 2007, or the newbie Episcopal one that started up on March 29, 2008 — has the legal control of the corporation sole under California law?

The decision by the Court of Appeals does not address this key question. Indeed, it barely mentions the Anglican Diocese, and does not acknowledge its separate existence under California law, let alone its connection to the corporation sole. (The Episcopal plaintiffs made a strategic decision not to name the Anglican Diocese in their lawsuit, and to make the corp sole a plaintiff as though they already controlled it, because they wanted to pretend that they were the “only” diocese in San Joaquin. It looks as though the strategy confused the civil courts — as it was doubtlessly intended to do.)

The case is not over yet — the Anglican parties can ask the Court for a rehearing based on the factual mistakes it made in its opinion, and if the Court refuses to grant that request, they can ask the California Supreme Court to review the decision, which the Court of Appeal ordered be published in the official reports. (The California Supreme Court tends not to review unpublished opinions.) If such a request is filed, the parties will not know the disposition of the case for another 60 to 120 days.

Watch this space for more legal news as this matter continues to work its way through the courts.   

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