Niemann v. Vaughn Community Church

• Decision Date: 09 June 2005
• Docket Number: No. 74782-2.,74782-2.
• Citation: 113 P.3d 463,154 Wash.2d 365
• Court: Washington Supreme Court
• Parties: Joyce NIEMANN, Petitioner, v. VAUGHN COMMUNITY CHURCH, Respondent.

113 P.3d 463

154 Wash.2d 365

Joyce NIEMANN, Petitioner, v. VAUGHN COMMUNITY CHURCH, Respondent.

No. 74782-2.

Supreme Court of Washington, En Banc.

Argued October 19, 2004.

Decided June 9, 2005.

Douglas Vincent Alling, Michael E. McAleenan, Robert Eugene Mack, Smith Alling Lane, Tacoma, for Petitioner.

Thomas Francis Peterson, Susan K. Goplen, Socius Law Group PLLC, Seattle, Craig A. Robertson, Robertson & Associates, Gainsville, Fl, for Respondent.

George Richard Hill, Aaron Hugh Caplan, Seattle, for Amicus Curiae (American Civil Liberties Union of Washington).

BRIDGE, J.

¶ 1 This case requires us to consider whether an alleged restrictive covenant in a deed transferring church property from one church to another, prevents the receiving church, Vaughn Community Church (VCC), from selling the original church property in order to relocate to a larger, nearby property. Petitioner Joyce Niemann, a parishioner at VCC, brought suit alleging the restrictive covenant in the deed prevented the proposed sale. The trial court ruled that the conveyance created a charitable trust, then granted VCC equitable relief, removing the alienation restriction from the trust. The Court of Appeals affirmed. We now affirm the grant of equitable relief, thereby modifying the charitable trust and permitting the sale of the church property. We hold the trial court correctly permitted deviation from the administrative trust provision, finding changed circumstances unanticipated by the settlor, and that the requested deviation furthered the charitable trust's primary purpose. Based on this holding, we decline to reach the remainder of the issues raised by the parties as unnecessary to the disposition of the case.¹

I

¶ 2 In 1949, the Emmanuel Congregational Church of Vaughn (ECC) owned a parcel of real property located at 17616 Hall Road, Vaughn, Washington.² ECC was a Protestant evangelical church and held services on the property. Since at least 1899, the property had been continuously used for evangelical services by a series of churches. In 1949, ECC merged with the Christian Church of Vaughn to create a new church called the Vaughn Community Church in Christ (which later changed its name to Vaughn Community Church, referred to here as VCC). As part of the merger, the trustees of ECC passed a resolution to transfer the subject property to VCC with the stipulation that "the property shall forever remain for the perpetual use of Protestant Evangelical Churches of the Community of Vaughn."³ Clerk's Papers (CP) at 406. While VCC took possession and began holding services, the land was not formally deeded at that time.

¶ 3 In 1956, VCC needed to remodel the church building on the subject property to meet the needs associated with its recent growth. In order to obtain a loan to finance the remodel, on February 22, 1956, ECC formally conveyed the subject property to VCC by deed. It contained the following relevant language:

WHEREAS, on April 5, 1949, the Board of Trustees of [ECC] met in regular session and passed a resolution pursuant to the authority of the Special Congregation Meeting aforesaid, as follows, resolved that

"The Emmanuel Congregational Church of Vaughn transfer (the) church property to the Vaughn Community Church of Christ, with the stipulation that said property shall forever remain for the perpetual use of Protestant Evangelical Churches of the Community of Vaughn"

....

NOW, THEREFORE, in consideration of the premises, [ECC] does, by these presents, convey and quit claim to Vaughn Community Church, a Washington corporation, all its interest in the following described real estate, situate in Pierce County, Washington, to-wit:

[Legal Description of Property]

TO HAVE AND TO HOLD said property for the perpetual use of Protestant Evangelical Churches of the Community of Vaughn, Washington.

Dated this 22nd day of February, 1956.

Pl.'s Ex. 10, at 2-3.

¶ 4 VCC continued to grow. In fact, the pastor testified that average Sunday services grew from 30 participants in 1956 to approximately 180 participants by 1999. In the early 1980s, VCC was remodeled and expanded to its current condition, including expansion of the sanctuary and addition of a fellowship hall and classrooms. In 1991, only six years after the completion of the remodel, VCC commissioned a feasibility study to explore options for expanding capacity at the current site. The study concluded the current conditions were inadequate and further expansion was not feasible. On March 28, 1999, the majority of those present at the VCC congregational meeting, 79 percent, voted in favor of selling the church property.⁴ VCC purchased a parcel of real property approximately 4.3 miles from the subject property and planned to use the proceeds from a sale of the subject property to fund construction of a new church facility.

¶ 5 In response to this course of events, Niemann brought this action, both in her individual capacity and derivatively, as a member of VCC, to enjoin VCC from selling the church property to anyone other than a "Protestant Evangelical Church of the Community of Vaughn." CP at 7-13. Specifically, Niemann filed suit in superior court seeking declaratory and injunctive relief to enforce the alleged restrictive covenant in the 1956 deed. In response to separate pretrial motions, Superior Court Judge Kathryn Nelson granted partial summary judgment, finding that the conveyance of the church property to VCC in 1956 created a charitable trust and that VCC is a primary beneficiary of the trust, though not the sole beneficiary. Neither party appealed these rulings.

¶ 6 Following a two-week bench trial, Judge Marywave Van Deren entered final judgment and made specific findings of fact and conclusions of law in favor of VCC. Based on the pretrial ruling that the 1956 deed created a charitable trust, the trial court, without distinguishing between the two, applied the similar yet distinct equitable doctrines of cy pres and equitable deviation to modify its terms and administration. The court sanctioned VCC's request to deviate from the trust terms to allow for the sale of the subject property to finance a new church building to serve the Protestant evangelical community of Vaughn. In addition to this grant of equitable relief, the court ruled that the Washington Law Against Discrimination (WLAD), RCW 49.60.224,⁵ prohibited the restrictive covenant found in the habendum clause of the 1956 deed. Specifically, the court held that RCW 49.60.224 applies to charitable trusts and prohibits restraints on alienation of real property on the basis of creed. Secondly, in response to Niemann's argument challenging the constitutionality of the WLAD's application in this case, the trial court held that RCW 49.60.224 does not have a coercive effect on Niemann's practice of religion, that a compelling state interest exists, and that the statute is the least restrictive means of accomplishing that interest. The court further held that the equal protection clause of the Fourteenth Amendment barred it from enforcing the restrictive covenant.

¶ 7 The Court of Appeals, by a 2-1 majority, affirmed the trial court's rulings with the exception of the equal protection argument, which it declined to reach. Niemann v. Vaughn Cmty. Church, 118 Wash.App. 824, 828, 831-32, 77 P.3d 1208 (2003). We granted Niemann's petition for review.

II

¶ 8 We begin our analysis by addressing the trial court's grant of equitable relief, permitting modification of the charitable trust.⁶

Standard of Review

¶ 9 The parties present differing views as to the standard of review. Without discussion, Niemann's arguments advocate for us to review the grant of equitable relief de novo. VCC asserts we should apply the abuse of discretion standard. The Court of Appeals, in affirming the equitable relief, agreed with VCC, holding that trial courts have broad discretionary power in fashioning equitable remedies and such action is typically reviewed for abuse of discretion. Niemann, 118 Wash.App. at 835,77 P.3d 1208 (citing SAC Downtown Ltd. P'ship v. Kahn, 123 Wash.2d 197, 204, 867 P.2d 605 (1994)). This standard is incorrect.

¶ 10 While the fashioning of the remedy may be reviewed for abuse of discretion, the question of whether equitable relief is appropriate is a question of law. See Puget Sound Nat'l Bank of Tacoma v. Easterday, 56 Wash.2d 937, 943, 350 P.2d 444 (1960) (finding that the question of whether the trial court exceeded its authority in applying cy pres to be a question of law); cf. Townsend v. Charles Schalkenbach Home for Boys, Inc., 33 Wash.2d 255, 205 P.2d 345 (1949).

¶ 11 The dispute between these parties can best be described as a mixed question of fact and law. While we have previously held that construction of deeds is a matter of law for the court, see Martin v. City of Seattle, 111 Wash.2d 727, 732, 765 P.2d 257 (1988), we additionally recognize that the primary objective of deed interpretation is to discern the parties' intent. See 17 WILLIAM B. STOEBUCK & JOHN W. WEAVER, WASHINGTON PRACTICE: REAL ESTATE: PROPERTY LAW § 7.9 (2d ed.2004); see also Harris v. Ski Park Farms, Inc., 120 Wash.2d 727, 739, 844 P.2d 1006 (1993) ("A court should construe a deed grant in a manner which gives effect to the intent of the parties. The intent of the parties is to be derived from the entire instrument and, if ambiguity exists, the situation and circumstances of the parties at the time of the grant are to be considered." (footnote omitted)). In other words, "[i]t is a factual question to determine the intent of the parties" with the court then "apply[ing] the rules of law to determine the legal consequences of that intent." Veach v. Culp, 92 Wash.2d 570, 573, 599 P.2d 526 (1979); see also Sunnyside Valley Irrigation Dist. v. Dickie, 149 Wash.2d 873, 879-80, 73 P.3d 369 (2003). Applying these principles here, we give deference to the trial court's factual determinations but review the trial court's...