Episcopal Diocese of Fort Worth v. Episcopal Church

• Decision Date: 22 May 2020
• Docket Number: No. 18-0438,18-0438
• Citation: 602 S.W.3d 417
• Parties: The EPISCOPAL DIOCESE OF FORT WORTH, et al., Petitioners, v. The EPISCOPAL CHURCH, et al., Respondents
• Court: Texas Supreme Court

602 S.W.3d 417

The EPISCOPAL DIOCESE OF FORT WORTH, et al., Petitioners,

v.The EPISCOPAL CHURCH, et al., Respondents

No. 18-0438

Supreme Court of Texas.

Argued December 5, 2019

OPINION DELIVERED: May 22, 2020

J. Shelby Sharpe, Fort Worth, R. David Weaver, Arlington, Scott A. Brister, Austin, for Petitioners.

Kathleen Wells, Fort Worth, William M. Jay, David Booth Beers, Daniel L. Tobey, Mary Kostel, Sandra Cockran Liser, for Respondents The Episcopal Church, Katherine Jefferts Schori.

Frank Gilstrap, Arlington, Coyt (Randy) R. Johnston, Dallas, Charles (Chad) E. Baruch, Frank W. Hill, for Respondent The Local Episcopal Congregations.

Kathleen Wells, Jonathan D.F. Nelson, Fort Worth, Stephen S. Gilstrap, Robert P. Ritchie, Thomas S. Leatherbury, Dallas, R. Kent Piacenti, Daniel L. Tobey, William Sims Jr., for Respondent The Local Episcopal Parties.

Justice Guzman delivered the opinion of the Court.

Following a disagreement over religious doctrine, the Episcopal Diocese of Fort Worth and a majority of its congregations withdrew from The Episcopal Church. The church replaced the diocese's leaders with church loyalists, and both the disaffiliating and replacement factions claimed ownership of property held in trust for the diocese and local congregations. As all parties agree, a corporate entity holds legal title to the disputed property for the benefit of the Episcopal Diocese of Fort Worth and congregations in union with that diocese's convention.¹ The central issue on appeal is narrow: which faction of the splintered Episcopal diocese is the "Episcopal Diocese of Fort Worth"? The withdrawing faction contends that under the diocese's organizational documents, the unincorporated association's identity is determined by the majority. The church and the loyalists contend the entity's identity is an ecclesiastical determination the First Amendment requires courts to accept and, under secular law, a subordinate entity in a tiered association cannot unilaterally withdraw from the association even under organizational documents providing for majority rule.

When this property dispute first came to the Court on direct appeal seven years ago, we held that what happens to property following a religious entity's disassociation from a hierarchical church is a nonecclesiastical issue to be determined based on the same neutral principles of law applicable to other entities unless the entity's affairs "have been ordered so that ecclesiastical decisions effectively determine the property issue."² Applying neutral principles to the undisputed facts, we hold that (1) resolution of this property dispute does not require consideration of an ecclesiastical question,³ (2) under the governing documents, the withdrawing faction is the Episcopal Diocese of Fort Worth, and (3) the trial court properly granted summary judgment in the withdrawing faction's favor. We therefore reverse the court of appeals' contrary judgment.

I. Background

The Episcopal Church (TEC) in the United States is a three-tiered religious organization founded in 1789. The first and highest tier of the organization is the General Convention, which consists of representatives from each regional diocese and most TEC bishops.⁴ The second tier is composed of geographically defined regional dioceses, each of which is governed by its own constitution and canons but must also accede to the General Convention's constitutions and canons.⁵ Each diocese elects a bishop (Diocesan Bishop) who is subject to TEC's ecclesiastical regulation, and each diocese is governed by a legislative body called a convention (Diocesan Convention). The Diocesan Bishop, clergy, and lay representatives from each congregation in the diocese comprise the convention. The third tier is composed of local parishes, missions, and congregations, which in turn adopt the constitution and canons of their regional diocese and the General Convention.

In 1982, the Episcopal Diocese of Fort Worth (Fort Worth Diocese) was formed as an unincorporated association after the Episcopal Diocese of Dallas voted to divide. Since its inception, the Fort Worth Diocese's constitution has provided that church property "acquired for the use of a particular Parish or Mission" shall be held by the Corporation of the Episcopal Diocese of Fort Worth (the Diocesan Corporation) "in trust for the use and benefit of such Parish or Mission" that is in union with the diocese's convention (the Diocesan Trust).⁶ The constitution further provides that if a parish or mission dissolves, the property held in trust by the Diocesan Corporation "shall revert to said Corporation for the use and benefit of the Diocese, as such." Since its inception, amendments to the diocese's constitution and canons have been authorized based on a majority vote of the Diocesan Convention.⁷ Under the governing documents, election of the Diocesan Bishop and members of the diocese's standing committee require either a concurrent majority vote of diocesan clergy and laity attending the convention or a super-majority vote, depending on the circumstances.

The Fort Worth Diocese's canons require the Diocesan Corporation's affairs to be conducted and administered by a Board of Trustees of five elected members, all of whom must be either (1) lay persons "in good standing of a parish or mission in the Diocese," or (2) "members of the Clergy canonically resident in the Diocese." The Diocesan Bishop serves as Chairman of the Board unless the bishop designates another officer of the corporation to serve as such. The canons empower the Board of Trustees to conduct the corporation's affairs "in accordance with its charter and by-laws and in accordance with the Constitution and Canons of the Diocese from time-to-time adopted."

In 1982, after the Fort Worth Diocese adopted its constitution and canons (Diocesan Constitution and Canons), it was admitted into union with TEC. At that time, the new diocese and every congregation in its jurisdiction "fully subscribe[d] to and accede[d] to the Constitution and Canons of The Episcopal Church." The "Dennis Canon," which purports to impose a trust on all church property for TEC's benefit, has been among TEC's governing principles since 1979. In contrast to the Diocesan Trust, it provides:

All real and personal property held by or for the benefit of any Parish, Mission or Congregation is held in trust for this Church and the Diocese thereof in which such Parish, Mission or Congregation is located. The existence of this trust, however, shall in no way limit the power and authority of the Parish, Mission or Congregation otherwise existing over such property so long as the particular Parish, Mission or Congregation remains a part of, and subject to, this Church and its Constitution and Canons.

In 1983, the Fort Worth Diocese filed articles incorporating the Diocesan Corporation as a Texas nonprofit of perpetual duration. Consistent with the Diocesan Constitution and Canons, the articles of incorporation required the corporation to administer trust property "in accordance with the Constitution and Canons of the Episcopal Diocese of Fort Worth as they now exist or as they may hereafter be amended." At that time, the corporate bylaws also provided that "the affairs of this nonprofit corporation shall be conducted in conformity with the Constitution and Canons of the Episcopal Church in the United States of America and the Constitution and Canons of the Episcopal Diocese of Fort Worth, as they may be amended or supplemented from time to time." Bylaws consistent with the Diocesan Constitution and Canons established the number of trustees, the terms of office, and the procedure for electing trustees and filling vacancies.⁸ Amendments to the bylaws were authorized on a majority vote of trustees attending any regular or special board meeting. The year after incorporation, friendly litigation between the Fort Worth and Dallas dioceses resulted in a judgment vesting legal title of certain real and personal property in the Diocesan Corporation.

Five years later, in 1989, the Fort Worth Diocese repudiated any trust imposed by the Dennis Canon by amending its canons to expressly disclaim the existence of a trust for TEC's benefit:

Property held by the Corporation for the use of a Parish, Mission or Diocesan School belongs beneficially to such Parish, Mission or Diocesan School only. No adverse claim to such beneficial interest by the Corporation, by the Diocese, or by The Episcopal Church of the United States of America is acknowledged, but rather is expressly denied.

Nearly two decades later, unresolved doctrinal differences culminated in a schism that precipitated this dispute. In 2006, the Diocesan Corporation unanimously amended its articles and bylaws to remove all references to TEC. The amendments also gave the trustees authority to determine the Diocesan Bishop's identity for purposes of the governing documents, if identity is disputed; allowed a majority of trustees to select the Chairman of the Board when the diocese is without a bishop; and authorized removal of a trustee by a majority of the board rather than by the bishop. The amendments did not alter the terms of office or change the process for electing trustees or filling vacancies, but as of 2006, the bylaws required the corporation's trustees to be "lay persons in good standing of a parish or mission in the body now known as the Episcopal Diocese of Fort Worth, or members of the clergy canonically resident within the geographical region of the body now known as the Episcopal Diocese of Fort Worth."

Believing TEC had embraced doctrine reflecting "a substantial departure from the biblical and historic faith," the 2007 and 2008 conventions of the Fort Worth Diocese also voted overwhelmingly to withdraw from union with TEC. To that end, the conventions amended the Diocesan Constitution and Canons to remove references to TEC and to reflect membership with the Anglican Province of the Southern Cone.⁹ Under the...