Church of God of Prospect Plaza v. Fourth Church of Christ, Scientist, of Brooklyn

• Decision Date: 07 July 1981
• Citation: 54 N.Y.2d 742,442 N.Y.S.2d 986,426 N.E.2d 480
• Parties: , 426 N.E.2d 480 CHURCH OF GOD OF PROSPECT PLAZA, Appellant, v. FOURTH CHURCH OF CHRIST, SCIENTIST, OF BROOKLYN, Respondent.
• Court: New York Court of Appeals Court of Appeals

Page 986

442 N.Y.S.2d 986

54 N.Y.2d 742, 426 N.E.2d 480

CHURCH OF GOD OF PROSPECT PLAZA, Appellant, v. FOURTH CHURCH OF CHRIST, SCIENTIST, OF BROOKLYN, Respondent.

Court of Appeals of New York.

July 7, 1981.

Stephen A. Humsjo, Islip, for appellant

Dwight B. Demeritt, Jr., New York City, and Paul V. Nunes, Hoboken, N. J., for respondent.

OPINION OF THE COURT MEMORANDUM.

The order of the Appellate Division should be affirmed, 76 A.D.2d 712, 431 N.Y.S.2d 834.

Until and unless both leave of the court and appropriate denominational authorization have been obtained as required by section 12 of the Religious Corporations Law, such a corporation may not sell any of its real property. While under that statute it cannot make a valid conveyance without judicial sanction, it is established that it may enter into a contract to sell conditioned upon obtaining court approval. Moreover, in an action for specific performance, a court of equity "has ample power to inquire into the fairness of the contract and as to its advantage or disadvantage to the religious corporation, and to approve the proposed conveyance and direct it to be made where, upon all the facts, no valid reason appears for refusing such relief" (Muck v. Hitchcock, 149 App.Div. 323, 328-329, 134 N.Y.S. 271, revd. on other grounds, 212 N.Y. 283, 106 N.E. 75; Sun Assets Corp. v. English Evangelical Lutheran Church, 19 Misc.2d 187, 192, 185 N.Y.S.2d 695 accord Bounding Home Corp. v. Chapin Home for Aged & Infirm., 19 Misc.2d 653, 654, 191 N.Y.S.2d 722 Congregation Beth Elohim v. Central Presbyt. Cong., 10 Abb.Prac. 484, 489; Bowen v. Trustees of Irish Presbyt. Cong. in City of N. Y., 6 Bosw. 245; but see Wilson v. Ebenezer Baptist Church, 17 Misc.2d 607, 187 N.Y.S.2d 861).

In the present case, the Appellate Division's factual finding that the contemplated sale would not promote the purposes of the respondent religious corporation or the interests of the members of its congregation is supported by the weight of the evidence (Electrolux Corp. v. Val-Worth, Inc., 6 N.Y.2d 556, 563, 190 N.Y.S.2d 977, 161 N.E.2d 197). Under the circumstances, we cannot say that judicial consent was not properly withheld (Wyatt v. Benson, 4 Abb.Prac. 182, 189). It follows that the purported agreement would be invalid and did not entitle the plaintiff to either specific performance or monetary damages (Associate Presbyt. Cong. of Hebron v. Hanna, 113 App.Div. 12, 14, 98 N.Y.S. 1082; Sun Assets v. English Evangelical Lutheran Church, 19 Misc.2d 187, 192, 185 N.Y.S.2d 695 supra).

True, in most cases it would be preferable for the approval to have been sought in an independent proceeding instituted pursuant to section 511 of the Not-For-Profit Corporation Law, a matter, however, of no moment here since approval was not granted. For the same reason, it is now unnecessary for us to consider the propriety of a grant of permission in a proceeding such as the present one in which all the requirements of section 511 would have been met.

Finally, it having been determined that judicial approval was properly refused, it becomes unnecessary for us to pass on whether, absent the requirement for such consent, the agreement between the parties would have constituted an enforceable contract.

COOKE, Chief Judge (concurring).

I concur in the result, said accord being reached on the narrow ground that section 12 of the Religious Corporations Law confers no power upon the courts to consider approval of the transaction at issue.

By statute, a religious corporation may not "sell * * * any of its real property without applying for and obtaining leave of court" (Religious Corporations Law, § 12, subd. 1). Since a sale occurs when a contract of sale is made (e. g., Fries v. Merck,...