Hope Presbyterian Church of Rogue River v. Presbyterian Church (U.S.A.)

• Decision Date: 27 April 2011
• Docket Number: No. 072707E2; A139430.
• Citation: 242 Or.App. 485,255 P.3d 645
• Parties: HOPE PRESBYTERIAN CHURCH OF ROGUE RIVER, a domestic nonprofit corporation, Plaintiff–Respondent,v.PRESBYTERIAN CHURCH (U.S.A.) and Presbytery of the Cascades, a domestic nonprofit corporation, Defendants–Appellants.
• Court: Oregon Court of Appeals

242 Or.App. 485

255 P.3d 645

HOPE PRESBYTERIAN CHURCH OF ROGUE RIVER, a domestic nonprofit corporation, Plaintiff–Respondent,

v.PRESBYTERIAN CHURCH (U.S.A.) and Presbytery of the Cascades, a domestic nonprofit corporation, Defendants–Appellants.

No. 072707E2; A139430.

Court of Appeals of Oregon.

Argued and Submitted April 27, 2010.Decided April 27, 2011.

Douglas Ethan Lumish, California, argued the cause for appellants. On the opening brief were James A. Wallan, and Hornecker, Cowling, Hassen & Heysell, LLP. With them on the reply brief were Yen P. Nguyen, Douglas Ethan Lumish, and Weil, Gotshal & Manges LLP.James R. Dole, argued the cause for respondent. With him on the brief was Cauble, Dole, Sorenson & Ransom, LLP.Before ORTEGA, Presiding Judge, and ARMSTRONG, Judge, and LANDAU, Judge Pro Tempore.LANDAU, J. Pro Tempore.

This is a dispute between a church, the Hope Presbyterian Church of Rogue River (Hope Presbyterian or plaintiff), and the denomination from which it seeks to separate, the Presbyterian Church (USA) (PCUSA) and its regional presbytery, the Presbytery of the Cascades (collectively, defendants). At issue is the ownership of the real and personal property—including a church building and its contents—to which Hope Presbyterian holds legal title. Hope Presbyterian contends that its title to the property is conclusive. Defendants contend that the general church's organizational constitution, the Book of Order, declares that local congregations hold property in trust for the PCUSA and that First Amendment principles require civil courts to give effect to such declarations by a hierarchical church. The trial court determined that the First Amendment authorizes civil courts to resolve church disputes by application of neutral, secular principles of law and that, without reference to the Book of Order, Hope Presbyterian was entitled to summary judgment on the basis of its title in the disputed property. The court quieted title to the disputed real property in plaintiff and determined, further, that defendants have no beneficial interest in any of plaintiff's property, real or personal.

Defendants appeal, arguing that the trial court erred in failing even to consider the express trust provisions contained in the Book of Order and in failing to give effect to those provisions. We agree and therefore reverse and remand for entry of judgment in favor of defendants.

I. FACTS

A. Presbyterian Governance

What is known as the “Presbyterian” church has its roots in the sixteenth-century Protestant Reformation and, in particular, the theology of the French lawyer John Calvin and the Scottish theologian (and student of Calvin) John Knox. Among the distinctive features of Presbyterianism is its system of church governance, characterized by a hierarchy of representative assemblies—as opposed to church governance by bishops (“episcopalianism”) or congregations (“congregationalism”). See generally Sydney E. Ahlstrom, A Religious History of the American People 132–33 (1972). Presbyterians were among the earliest settlers in colonial America, founding congregations as early as the 1630s. In the eighteenth century, a group of Presbyterian ministers met in Philadelphia and formed the first colonial “Presbytery,” or governing assembly of elders. In the following two centuries, as both the nation and the church grew, disagreements and divisions within the denomination formed over issues of theology, governance, and national politics—including slavery, women's rights, civil rights, and, most recently, gay and lesbian rights. In consequence, the church in America split and reunited in various combinations on a number of occasions.

Currently, the largest Presbyterian denomination is the PCUSA, which was formed in 1983 as the result of the merger of the Presbyterian Church in the United States and the United Presbyterian Church in the United States of America (UPCUSA), which was itself a result of an earlier merger with other divisions within the larger Presbyterian Church.

Governance within the PCUSA is set out in a constitution, consisting of the Book of Confessions and the Book of Order, which describes the essentially hierarchical nature of the church's organizational structure. As explained in a statement of historic principles of church government and discipline, first adopted in 1797:

“[T]he several different congregations of believers, taken collectively, constitute one Church of Christ, called emphatically the Church; that a larger part of the Church, or a representation of it, should govern a smaller, or determine matters of controversy which arise therein; that, in like manner, a representation of the whole should govern and determine in regard to every part, and to all the parts united: that is, that a majority shall govern; and consequently that appeals may be carried from lower to higher governing bodies, till they be finally decided by the collected wisdom and united voice of the whole Church. For these principles and this procedure, the example of the apostles and the practice of the primitive Church are considered as authority.”

The Book of Order explains that the PCUSA is “governed by representative bodies composed of presbyters.” “Presbyters” are the individual ministers and elders of the church. The governing bodies, in hierarchical order, are the “General Assembly,” the “synod,” the “presbytery,” and the “session.” The “particular churches” are governed by “sessions,” consisting of the pastor and elders in active service. Presbyteries are district governing bodies, with membership representing a minimum of 12 churches, which govern the churches and sessions within their geographical districts. Synods govern geographical groups of not fewer than three presbyteries. The General Assembly is the highest governing body in the PCUSA, and it governs the synods. The General Assembly is made up of elected elders and ministers from each presbytery, who are called “commissioners” to the General Assembly. According to the Book of Order, each of the governing bodies is “separate and independent,” but each also is “subject to review by the next higher governing body.”

The Book of Order addresses, among many other things, how real and personal property is held within the church hierarchy. Chapter VIII, entitled “THE CHURCH AND ITS PROPERTY,” provides:

“All property held by or for a particular church, a presbytery, a synod, the General Assembly, or the Presbyterian Church (U.S.A.), whether legal title is lodged in a corporation, a trustee or trustees, or an unincorporated association, and whether the property is used in programs of a particular church or of a more inclusive governing body or retained for the production of income, is held in trust nevertheless for the use and benefit of the Presbyterian Church (U.S.A.).”

The Book of Order further provides that, whenever the property of a particular church “ceases to be used by that church as a particular church of the Presbyterian Church (U.S.A.) in accordance with this constitution, such property shall be held, used, applied, transferred, or sold as provided by the presbytery.” The property provisions of the PCUSA Book of Order are based on nearly identical provisions in the Book of Order of the UPCUSA, with which the PCUSA merged in 1983. B. Hope Presbyterian Church of Rogue River

“Hope Presbyterian Church of Woodville, Oregon,” was first organized on May 26, 1901, with 11 members and two elders elect. At that time, the congregation was received in the Presbytery of Southwest Oregon, which was its next highest governing body until 1974. The Presbytery of Southwest Oregon was within the organization of a predecessor of UPCUSA.

The community of Woodville apparently became absorbed into the town of Rogue River, and documents in the summary judgment record reflect that, by the 1930s, the church congregation became known as “Hope Presbyterian Church of Rogue River.” Over the years, the congregation also went by “Hope Presbyterian Church” or, simply, “Hope Presbyterian.”

In 1930, plaintiff formally incorporated as “Hope Presbyterian Church of Rogue River.” The articles of incorporation state that the corporation's purpose is “to preach the gospel & to inculcate social & spiritual Principles thru preaching & Teaching, also thru social & Recreational Programs.” The articles do not specifically require affiliation with UPCUSA or any other Presbyterian denomination.

In the 1950s, the congregation moved to its current location in Rogue River, Oregon. At that time, legal title to the disputed real property was vested in the Trustees of the Presbytery of Southwest Oregon, which held a mortgage. In 1961, the Presbytery of Southwest Oregon transferred title to “The Hope Community Presbyterian Church, Rogue River, Ore,” by warranty deed. The conveyance recited:

“Trustees of the Presbytery of Southwest Oregon * * * hereby grant, bargain, sell and convey [the property] To Have and to Hold the above described and granted premises unto the said grantee, its heirs and assigns forever. And the grantor does covenant that it is lawfully seized in fee simple * * * and that it will and its successors shall warrant and forever defend the above granted premises, and every part and parcel thereof, against the lawful claims and demands of all persons whomsoever.”

The deed did not include any reservation or restriction on the use of the property or mention a trust for defendants or its predecessors. It is undisputed that plaintiff holds legal title to the property.

In the 1950s and 1960s, the presbytery lent money to Hope Presbyterian; the loans were represented by promissory notes and secured by the church property, with mortgages and trust deeds, and were repaid in full.

In 1983, as we have noted, the UPCUSA—with which Hope Presbyterian had been affiliated—merged with the Presbyterian Church in the United States to form the PCUSA. The record on summary judgment shows that...