Berthiaume v. McCormack

• Decision Date: 14 February 2006
• Docket Number: No. 2005–191.,2005–191.
• Citation: 891 A.2d 539,153 N.H. 239
• Court: New Hampshire Supreme Court
• Parties: Claire BERTHIAUME and another. v. John B. McCORMACK, the Roman Catholic Bishop of Manchester, a Corporation Sole.

153 N.H. 239

891 A.2d 539

Claire BERTHIAUME and another.

v.John B. McCORMACK, the Roman Catholic Bishop of Manchester, a Corporation Sole.

No. 2005–191.

Supreme Court of New Hampshire.

Argued: Oct. 19, 2005.

Opinion Issued: Feb. 14, 2006.

Law Offices of Randall E. Wilbert, of Nashua (Randall E. Wilbert and Mary Lynn Roedel on the brief, and Mr. Wilbert orally), for the petitioners.

Devine, Millimet & Branch, P.A., of Manchester (Ovide M. Lamontagne and Jonathan M. Shirley on the brief, and Mr. Lamontagne orally), for the respondent.

BRODERICK, C.J.

The petitioners, Claire Berthiaume, Robert Daigle, Jeanne Daigle, Theresa Santerre, Rita Bonner, Francis J. Bonner, John C. Kent, Paula Kent, Edward A. Vitagliano, and Theresa A. Vitagliano, members of the former St. Francis Xavier parish (St. Francis Xavier) of the Roman Catholic Church in Nashua, appeal the order of the Superior Court (Groff, J.) dismissing their claims against the respondent, John B. McCormack (Bishop McCormack), in his capacity as the Roman Catholic Bishop of Manchester, a corporation sole (RCBM). We affirm.

I

The record supports the following. In 1885, St. Francis Xavier was founded by the Diocese of Manchester. In July of that year, the Jackson Company, a textile manufacturer, deeded certain land in Nashua to the Bishop of Manchester, Denis Bradley. The conveyance was made upon three express conditions contained in the deed: (1) that the Bishop build "a substantial church edifice suited to public religious use" within two years of the conveyance; (2) that if that church were destroyed by a fire or otherwise, the Bishop rebuild "a like church edifice designed for a similar purpose" within three years; and (3) that the land always "be used and occupied as a place of public religious resort and for public religious and pious uses and purposes, and never for any other use or purpose whatever." The deed provided that, upon default of any of the conditions, the land would "immediately revert to [the] Jackson Co. its successors or assigns."

To make clear that this and other property was owned by the Manchester Diocese of the Roman Catholic Church and not by Bishop Bradley personally, the legislature created the Roman Catholic Bishop of Manchester as a corporation sole. Laws 1901, ch. 232. The statute created the RCBM's powers and responsibilities with respect to property that had been conveyed to Bishop Bradley or would subsequently be conveyed to the Diocese of Manchester or its parishes. Id.

In May 1886, a small brick chapel and wood frame rectory were built on the property conveyed by the Jackson Company, and in 1889, the present St. Francis Xavier church was completed. From the founding of St. Francis Xavier until 1918, the parish's debts were paid through donations from its parishioners. Between 1918 and 1920, a school and a convent were constructed on the property. The parishioners continued to make donations, and in 1945, they paid off the construction debt on both structures. These five buildings and the land on which they sit are the subject of this litigation.

In 2001, Bishop McCormack formed a task force to study ways for the Roman Catholic Church to fulfill its mission in Nashua while also managing its resources in the face of a declining number of priests and inner city parishioners. On March 1, 2003, consistent with the task force recommendations, Bishop McCormack decreed that the parishes of St. Stanislaus, St. Francis Xavier, and St. Aloysius of Gonzaga would be united to form one territorial parish. In doing so, he suppressed the parishes of St. Stanislaus and St. Francis Xavier, and designated the St. Aloysius of Gonzaga church as the place of worship for the three united parish communities. The St. Francis Xavier church was closed in March 2003, and all items of religious value and significance were removed by the diocese and transferred to the newly expanded St. Aloysius of Gonzaga parish. At the time the three parishes were unified, the petitioners were members of St. Francis Xavier.

In November 2002, the St. Francis Xavier Church Foundation (Foundation) was organized by St. Francis Xavier parishioners, including some of the petitioners, for the purpose of receiving a conveyance of the land and buildings at issue, or the ability to operate and to manage them. In February 2004, the Foundation proposed to purchase the land and buildings for $17,901.11, the amount of the outstanding real estate taxes owed to the City of Nashua. The RCBM, however, decided to sell the property to someone else. In April 2004, the Foundation and four of the petitioners filed suit in the superior court seeking to prohibit a sale of the property. The Foundation was subsequently removed as a petitioner and the remaining six petitioners were joined.

During the pendency of that litigation, the RCBM signed a purchase and sale agreement for the land and buildings with an individual who agreed to give the property to the Armenian Orthodox Church. The purchaser agreed to pay $1,000,000 and the Armenian Orthodox Church agreed to continue to use the property for public religious purposes as required by the original 1885 deed. The RCBM then filed suit in the Hillsborough County Probate Court requesting a ruling that the proposed sale was permitted by the 1885 deed restrictions. Pending a ruling, the superior court proceedings were stayed.

The petitioners attempted to intervene in the probate court, making various arguments why the proposed sale should not be allowed. The RCBM both objected to the intervention and responded to the petitioners' substantive arguments. The probate court subsequently ruled that the petitioners lacked standing and accordingly denied their motion. No appeal was taken. After the Jackson Company's successor and the Attorney General, as director of charitable trusts, assented to the sale of the property, the probate court issued the RCBM's requested ruling, allowing the sale to proceed.

With the probate court matter resolved, the superior court lifted the stay and addressed the petitioners' action. First, the petitioners contended that Laws 1901, chapter 232 (chapter 232), which created the RCBM, established a statutory trust that obligated the RCBM to hold St. Francis Xavier property in trust for the use and benefit of its parishioners. Second, they argued that the restrictions in the 1885 deed were in full force and effect and prohibited the RCBM from "conveying the church for a non-religious use." Third, they alleged that, "[b]y paying for the construction of the parish church and by the contributions made by the St. Francis Xavier parishioners to the parish and to the Diocese of Manchester, the Diocese [had] a confidential and fiduciary relationship with the St. Francis Xavier parishioners." They further argued that by closing the St. Francis Xavier church and selling the land and buildings, the Diocese breached its fiduciary duty and would be unjustly enriched. Accordingly, they petitioned the superior court to impose a constructive trust upon the RCBM with the St. Francis Xavier parishioners as beneficiaries, and to either prohibit the sale of the land and buildings and order their continued maintenance, or to order the RCBM to deed to the Foundation "all title, right and interest to the real estate."

The RCBM moved to dismiss, arguing that the enforcement of the 1885 deed restrictions was within the exclusive jurisdiction of the probate court, and that in any event the petitioners did not have standing to enforce the deed's provisions. The RCBM further argued that the First Amendment to the Federal Constitution prohibited courts from examining church doctrines and policies, and that the superior court could not resolve this litigation without violating that Amendment because the dispute involved the reorganization of parishes and redistribution of their property. Finally, the RCBM argued that the petitioners had not alleged sufficient facts to support a claim for a constructive trust.

The superior court granted the motion to dismiss. On the petitioners' first claim, it ruled that the statute creating the RCBM as a corporation sole also created a statutory trust with the parishioners as beneficiaries, and thus the superior court had jurisdiction to hear the case. However, the superior court ruled that, "to the extent[ ] the petitioners [sought] to challenge the Bishop's right to suppress the St. Francis Xavier Parish and to unite it with the two other parishes, and to determine whether that conduct [was] a breach of the Bishop's fiduciary duty to the members of the parish," the First Amendment would prohibit it from taking jurisdiction.

On the petitioners' second claim, that the 1885 deed restrictions prohibited the sale of the property, the superior court held that, although "the petitioners could seek to prevent [a sale in violation of the deed's provisions] by virtue of their status as beneficiaries under the statutory trust," it concluded that the probate court proceedings were "res judicata in regard to that issue." Further, it ruled that any claim that the proceeds of the sale would be misused was premature as the sale had not yet been completed and there were no funds available, let alone available for a purpose other than for the benefit of the three unified parishes.

On the final claim requesting imposition of a constructive trust, the superior court determined that, "even were the Court to find that the petitioners met the requirements for the imposition of a constructive trust, there is no basis for [its] imposition ... because an actual statutory trust exists." It also ruled that the same First Amendment restrictions that applied to a statutory trust also applied to a constructive one. Having thus resolved each claim against the petitioners, the superior court dismissed the petition. This appeal followed.

The petitioners appeal only their first and second claims. As to the statutory trust, they argue that by attempting to sell the...