Foster v. Collins, No. W2004-01959-COA-R3-CV (TN 12/27/2005)
| Decision Date | 27 December 2005 |
| Docket Number | No. W2004-01959-COA-R3-CV.,W2004-01959-COA-R3-CV. |
| Parties | MELVIN FOSTER, ET AL. v. HAROLD COLLINS, ET AL. |
| Court | Tennessee Supreme Court |
Archie Sanders, Memphis, TN, for Appellants, Harold Collins, as Moderator of Mississippi Boulevard Christian Church, Inc., Kym Barnett, Eldredge Williams, Delores Flagg, Susie Williams, Julia Bennett, Edward Reid, Sheilah Easterling, Leroy Norton, Theodore Peasant, Tessera Martin Hardaway, Clyde Hunt, James Hudson, Ervin Isom, Anthony Brown and Veda Bankhead, as the Church Council of MBCC
John S.Golwen, Kristen Wright, Memphis, TN, for Appellant, Dr. Frank Thomas as Senior Pastor of Mississippi Boulevard Christian Church
Patricia A. Odell, Memphis, TN, for Appellees, Melvin Foster, Erma Foster, Laura Cade, Allene C. McGuire, Rholedia Morgan, Marie Brooks, James H. Banks, Nevada M. Banks, Bettye M. Friends, Edward J. Friends, Juanita H. McCoy, and Bettye Briggs, Concerned Members of Mississippi Boulevard Christian Church, Inc.
Alan E. Highers, J., delivered the opinion of the court, in which W. Frank Crawford, P.J., W.S., and David R. Farmer, J., joined.
Fourteen members of a church filed a complaint against the church leadership seeking an injunction to prevent the church from renewing the pastor's contract and to enjoin the church leadership from utilizing church funds in a manner which displeased them. The parties ultimately settled the case by entering into a settlement agreement, which the chancery court incorporated into its order dismissing the case with prejudice. Shortly thereafter, the members filed a petition seeking to hold the church leadership in contempt for violating the terms of the settlement agreement. The chancellor found the church leadership to be in civil and criminal contempt of the order dismissing the case and imposed fines and jail time. The church leadership appealed to this Court. After reviewing the record in this case, we hold that the chancery court lacked subject matter jurisdiction over this case from the outset. Accordingly, the resulting order, which served as the basis for the chancery court's finding of contempt, is void. We reverse the chancery court's ruling in this case and dismiss the case in its entirety.
Mississippi Boulevard Christian Church, Inc. (hereinafter "MBCC") is a Tennessee non-profit corporation1 affiliated with the Christian Church and is located in Memphis, Tennessee. MBCC is congregationally governed2 pursuant to its constitution and bylaws. Dr. Frank Thomas (hereinafter "Dr. Thomas") became the Senior Pastor of MBCC pursuant to an employment contract entered into on July 6, 1999. Pursuant to the contract, Dr. Thomas would continue to serve as Senior Pastor indefinitely, with his employment being subject to review every three years. Dr. Thomas received a base salary of $125,000.00, and the leadership of MBCC, in their discretion, possessed the authority to award Dr. Thomas an annual merit bonus "commensurate with the growth of the Church." The employment contract also established a partnership between Dr. Thomas and an organization called The Ministry of Hope for Life International, Inc. (hereinafter "Hope for Life"). The stated purpose of Hope for Life was to "facilitate the global (national and international) preaching, teaching, writing, and consulting ministry of Dr. Frank Thomas, . . . especially in Africa." During the initial three-year term of Dr. Thomas' contract, MBCC agreed to pay $90,000.00 to Hope for Life to further its stated goals.
On September 30, 2002, fourteen members of MBCC (hereinafter the "Members" or "Appellees") filed a "Complaint for Injunctive Relief" against Dr. Thomas and the leadership of MBCC (hereinafter the "Church Leadership" or, collectively with Dr. Thomas, the "Appellants") in the Chancery Court of Shelby County. In September of 2002, the Church Leadership began negotiating the renewal of Dr. Thomas' contract. As a result of these negotiations, the Church Leadership approved a new contract with Dr. Thomas to take effect on January 1, 2003. The Members' complaint set forth the following as its primary purpose: "This lawsuit is being filed to enjoin [the Church Leadership] and any of their agents or assigns from entering into any contract with [Dr. Thomas] to continue as Pastor of [MBCC] without the members first having an opportunity to vote on whether they desire Thomas to remain as pastor." The Members also sought to enjoin the Church Leadership from "continuously denying the members of their rights as enumerated in the constitution and bylaws." The Members' complaint contained the following additional statement: "This suit is not purely an ecclesiastical dispute, it involves property rights so that this court has jurisdiction to hear and determine the matters hereinafter set forth." Regarding their alleged property rights, the Members alleged the following:
17. At the time Thomas was hired as pastor, [MBCC] was debt free with reserve funds in excess of 2.6 million dollars in the treasury. During Thomas' tenure, tithes and offerings have greatly reduced which has caused the church to encroach upon the reserve for the day-to-day operation of the church. These statistics do not reflect financial growth, which would entitle [Dr. Thomas] to an annual bonus.
. . .
19. The [Church Leadership] approved the payment of bonuses to Thomas without a finding that he had properly earned the bonuses by satisfactory completion of predetermined and agreed upon goals.
. . .
21. The employment contract between [Dr. Thomas] and [MBCC] provided for a Partnership Agreement between [MBCC] and Thomas. The Partnership is entitled [Hope for Life]. Over the past two and a half years [MBCC] has contributed $90,000.00 to [Hope for Life] without Thomas providing any accounting of the use of the funds nor has Thomas provided any information to reflect that the $90,000.00 was used for the Ministries.
The Members asserted that they would suffer immediate and irreparable harm if an injunction were not issued (1) to prevent the Church Leadership from entering into a new contract with Dr. Thomas without congregational approval, (2) to require Dr. Thomas to account for funds paid to Hope for Life and to return those funds to MBCC, and (3) to require the Church Leadership to produce proof that Dr. Thomas earned the bonuses he received.
In an attempt to resolve the dispute, the Church Leadership agreed to conduct a special election on December 15, 2002 for the purpose of allowing the congregation to vote on Dr. Thomas' retention. On December 2, 2002, the chancellor submitted a notice to the congregation of MBCC informing them of the upcoming election and setting forth the following ballot to be voted on: (1) "Should [Dr. Thomas] be retained as Senior Pastor of [MBCC]?" and (2) "Should the [MBCC's] Constitution and By-laws be amended to specifically reserve for the congregation the right to approve annually the retention of the Senior Pastor and the Senior Pastor's employment compensation?" On December 3, 2002, the chancellor entered an "Order Establishing Further Election Guidelines" which purported to set the times for voting, appointed a special master to oversee the election, and instructed that "ten (10) Shelby County Deputies and a Supervisor shall assist the Special Master in conducting the election at no expense to MBCC." On December 15, 2002, a majority of the congregation of MBCC voted to retain Dr. Thomas as Senior Pastor and voted against the congregation's involvement in an annual review of the Senior Pastor's retention thereafter.
Dissatisfied with the result of the election, the Members filed an "Amended Complaint for Injunctive Relief and Derivative Action." The amended complaint sought, in essence, the same injunctive relief prayed for in the original complaint. However, the Members subsequently asserted that their property rights were not addressed by the election, therefore, they submitted the amended complaint to reiterate these issues. The amended complaint also contained a derivative cause of action asserting that Dr. Thomas and the Church Leadership misappropriated church funds. On the same day that they filed their amended complaint, the Members also filed a petition for contempt alleging that Dr. Thomas and the Church Leadership violated the chancery court's December 3, 2002 "Order Establishing Election Guidelines," which ordered that "the parties are enjoined from undertaking or directing any acts of harassment, retaliation or threat toward each other." On March 24, 2003, the Church Leadership answered the Members' amended complaint raising the following defense: "The Court lacks subject matter jurisdiction of [the Members'] claims on the basis that the issues raised in the Amended Complaint are of an ecclesiastical nature and are therefore not justiciable."
On July 29, 2003, the parties appeared for a hearing on the Members' petition for contempt, however, they spent the entire day negotiating a settlement of the case. Later that day, the parties appeared before the chancellor to announce that they had reached an agreed settlement in the case. As a result, the chancellor entered an order on August 1, 2003, stating: The chancellor attached the agreement to the order and entered both into the record. At some point during the course of the proceedings in the trial court, the Members were apparently excommunicated from MBCC.
Shortly after the chancery court...
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