Court of Appeals of Indiana | Opinion 16A01-1409-PL-380 | April 8, 2015 Page 1 of 12 A TTORNEY FOR A PPELLANT Andrew G. Jones Law Office of Andrew G. Jones Indianapolis, Indiana A TTORNEY FOR A PPELLEE Judy L. Woods Benesch Friedlander Coplan & Aronoff LLP Indianapolis, Indiana



### IN THE 

# COURT OF APPEALS OF INDIANA

Steven Matthies, A

ppellan t -Defendant,

v. 

### The First Presbyterian Church of Greensburg Indiana, INC., A

ppelle e -Plaintiff April 8, 2015 Court of Appeals Case No. 16A01-1409-PL-380 Appeal from the Decatur Circuit Court The Honorable Timothy B. Day, Judge Cause No. 16C01-1302-PL-58



### Friedlander, Judge.

[1] Steven Matthies appeals from the grant of summary judgment in favor of The First Presbyterian Church of Greensburg Indiana, Inc. (F irst Presbyterian). On appeal, Matthies argues that the trial co urt erred in granting summary judgment in favor of Firs t Presbyterian. We affirm.Court of Appeals of Indiana | Opinion 16A01-1409-PL-380 | April 8, 2015 Page 2 of 12 [2] The Presbyterian Church (U.S.A.) is a national religious denomination governed by its Constitution, which prov ides for a hierarchical or connectional system of governance wherein each lowe r governing body is answerable to a successive higher governing body. The Presbytery of Whitewater Valley, Inc. (the Presbytery) is the regional govern ing body responsible for the mission and governance of the Presbyte rian Church in central an d northeastern Indiana, including all of Decatur County, wh ere First Presbyterian is located. 1 First Presbyterian is the local church that is ruled by its pastor(s) and ruling elders, who make up the Session, the lowest le vel of governance for the Presbyterian Church. The Session observes and carries out the instructions of the higher governing bodies, includ ing the Presbytery.

[3] On October 17, 2010, Revere nd Steven Matthies was “ca lled” to the office of Designated Pastor for the congr egation of First Presbyterian. Appellant’s Appendix at 72. On that date, Reverend Matthies entered into a Designated Pastor Contract (Contract) that cove red a three-year period beginning on October 18, 2010. The “Terms of Call” se t forth in the Contra ct provided that Reverend Matthies would receive a stated salary, housing, and other benefits, including, as pertinent to this case, five weeks of vacation. 2 Id . at 13.

1 There are four levels of governance within the Presbyt erian Church’s hierarchical structure. The Synod is the second level of governance, above the Presbytery, and covers a multi-state area.
2 The Contract does not expressly indi cate that the agreed-upon compensa tion and benefits were for the entire three-year contract term or to be provided on an annual basis. The parties treat the Terms of Call as setting forth compensation on an annual basis.Court of Appeals of Indiana | Opinion 16A01-1409-PL-380 | April 8, 2015 Page 3 of 12 [4] In the summer of 2012, the relationsh ip between Reverend Matthies and the First Presbyterian congr egation began to deteriorat e. First Presbyterian maintained that Reverend Matthies al ienated himself from the congregation when he “neglected his pastoral respon sibilities” by failing to make himself available for pastoral counseling servic es, missing scheduled appointments with parishioners, and refusing to keep the Session informed of his whereabouts and activities even after being asked to do so. Id . at 65. First Presbyterian maintains that from June 2012 into Ju ly 2012, Reverend Matthies “abandoned” his pastoral duties and was absent from church, without informing the Session or obtaining consent to take vacation time. Id . at 66. First Presbyterian asserts that by August 2012, Reverend Matthies “f ailed repeatedly to provide pastoral services to [First Presbyter ian] without explanation.” Id . Reverend Matthies asserts that during the timeframe in ques tion, he utilized two of the five weeks of vacation he was entitled to and that he informed the Session prior thereto. Matthies also asserts that he did not abandon his congregation and lists what his pastoral activities consisted of du ring his final weeks as the Designated Pastor for First Presbyterian. 3

[5] The discord between Reverend Matth ies and the First Presbyterian congregation escalated to a point where th e Presbytery intervened to meet with Reverend Matthies, the Session, and th e congregation to attempt to resolve their differences. On July 25, 2012, the Presbytery and its Committee on

3 Reverend Matthies maintains that he met with members of the congregati on, attended a funeral, conducted a funeral, led a worship service for a local retirement community, and volunteered at a soup kitchen, among other activities.Court of Appeals of Indiana | Opinion 16A01-1409-PL-380 | April 8, 2015 Page 4 of 12 Ministry (COM) held a meeting to disc uss the ongoing discord. Reverend Matthies left before the meeting concluded and failed to meet further with the Presbytery or the COM.

[6] On August 15, 2012, the Presbytery an d its COM held a special meeting to discuss Reverend Matthies’s continued pastoral relationship with First Presbyterian. A letter sent to Revere nd Matthies that same day informed Reverend Matthies that the COM had unanimously voted to immediately dissolve his pastoral relationship with First Presbyterian, finding that “the pastoral relationship between [Reverend Matthies and First Presbyterian] is no longer viable and needs to be ended in order to preven t further deterioration of the spiritual health of the church.” Id . at 86. The letter further provided that the COM and First Presbyterian woul d work with Reverend Matthies to negotiate a fair and equitable seve rance package, but Reverend Matthies declined such offer. On or about that same day, the COM notified First Presbyterian and its Session of its deci sion to dissolve Reverend Matthies’s pastoral relationship with First Presbyterian.

[7] On February 8, 2013, Re verend Matthies filed hi s complaint against First Presbyterian, alleging violations of the Indiana Wage Claims Statute and Indiana common law. Reverend Matthies sought compensation for unpaid salary and benefits, includ ing unpaid vacation wages, to which he claims he was entitled pursuant to the Terms of Call set out in the Contract. First Presbyterian filed its answer, affirmativ e defenses, and count erclaim, seeking a determination that Reverend Matthies br eached his obligations and promises toCourt of Appeals of Indiana | Opinion 16A01-1409-PL-380 | April 8, 2015 Page 5 of 12 the congregation by abandoning his pastoral duties. As such, First Presbyterian argues that it was no longer obligat ed under the Contract to compensate Reverend Matthies for unus ed vacation time.

[8] On June 12, 2013, First Presbyterian filed a motion for summary judgment, presenting several alternativ e grounds in support thereof, 4 and Reverend Matthies filed a response in opposition th ereto. The trial court held a summary judgment hearing on July 31, 2014. On August 13, 20 14, the trial court entered its order granting summary judgment in favor of First Presbyterian. Specifically, the trial court found that to resolve the dispute between the parties would require the court “to interpret and apply religious doctrine or ecclesiastical law,” which, the court note d, it is precluded from doing pursuant to the dictates of th e First Amendment. Id . at 6. Pursuant to Reverend Matthies’s request, the trial court m odified its order granting summary judgment to include a findin g that there is no just r eason for delay and directing entry of final judgment on behalf of Fi rst Presbyterian with regard to Reverend Matthies’s claims for breach of co ntract and failure to pay earned wages/benefits. Reverend Matthies now appeals.

[9] Summary judgment is appropriate where the moving party shows there are no genuine issues of material fact with respec t to a particular issue or claim. Ind.

4 First Presbyterian argued that the trial court was ba rred from considering Reverend Matthies’s claim on constitutional grounds, that Revere nd Matthies named the wrong defendan t, that the Contract is not an enforceable secular contract, and that the Indiana Wa ge Claims Statute is inapplicable because First Presbyterian is not an “employer” within the meaning of that statute. First Presbyterian also argued that Reverend Matthies’s conduct demonstr ated that he abandoned his pastoral responsibilities, thereby relieving First Presbyterian of any obli gations under the Contract.Court of Appeals of Indiana | Opinion 16A01-1409-PL-380 | April 8, 2015 Page 6 of 12 Trial Rule 56(C); Bleeke v. Lemmon, 6 N.E.3d 907 (Ind. 2014). We review a summary judgment order de novo. Hughley v. State, 15 N.E.3d 1000 (Ind. 2014). Considering only the facts support ed by evidence design ated to the trial court by the parties, we must determine whether there is a “genuine issue as to any material fact” and whethe r “the moving party is enti tled to a judgment as a matter of law.” T.R. 56(C); see also TP Orthodontics, Inc. v. Kesling, 15 N.E.3d 985 (Ind. 2014). Where the moving pa rty designates material demonstrating there are no genuine issues of material fa ct with respect to a particular issue or claim, the burden shifts to the non-moving party to come forward with designated evidence showing the existe nce of a genuine issue of material fact. Bleeke v. Lemmon, 6 N.E.3d 907.

[10] Upon review, we will accept as true those facts alleged by the nonmoving party. Sees v. Bank One, Ind., N.A., 839 N.E.2d 154 (Ind. 2005). “All designated evidence and reasonable inferences mu st be construed in favor of the nonmoving party, and do ubts resolved against the moving party.” Bleeke v. Lemmon, 6 N.E.3d at 917. The appellant bears the burden of demonstrating that the grant of summary judgment was erroneous. Hughley v. State, 15 N.E.3d 1000. Finally, we will affirm a grant of summary judgment on any theory supported by the record. Holiday Hospitality Franchis ing, Inc. v. AMCO Ins. Co., 983 N.E.2d 574 (Ind. 2013).

[11] The fundamental right to religious freed om, including the fr eedom to believe and the freedom to act, is protecte d by the United States and Indiana Constitutions. See Cantwell v. Connecticut , 310 U.S. 296 (1940) . The freedom toCourt of Appeals of Indiana | Opinion 16A01-1409-PL-380 | April 8, 2015 Page 7 of 12 believe is absolute, while the freedom to act is subject to regulation for the protection of society. Id . In such cases, however, excessive entanglement between church and state occurs where co urts are asked to review and interpret a church’s constitution, laws, and regulations. Konkle v. Henson , 672 N.E.2d 450 (Ind. Ct. App. 199 6). To be sure,
[t]he United States Supreme Court has long held that the First Amendment to the United States Consti tution, applicable to the states through the Fourteenth Amendment, requires civil courts to refrain from interfering in matters of chur ch discipline, faith, practice, and religious law. Watson v. Jones , 80 U.S. 679, 727 (13 Wall.), 20 L.Ed. 666 (1871). Thus, civil courts are precluded from resolving disputes involving churches if “resolution of the disputes cannot be made without extensive inquiry ... into religious law and polity....” Serbian Eastern Orthodox Diocese v. Milivojevich , 426 U.S. 696, 96 S.Ct. 2372, 2380, 49 L.Ed.2d 151 (1976). Accordingly, this court has held that “personnel decisions are protected fr om civil court interference where review by the civil courts would require the courts to interpret and apply religious doctrine or ecclesiastical law.” McEnroy v. St. Meinrad School of Theology , 713 N.E.2d 334, 337 (Ind. Ct. App. 1999), trans. denied , cert. denied , 529 U.S. 1068, 120 S.Ct. 1675, 146 L.Ed.2d 484 (2000). [12] Stewart v. Kingsley Terrace Church of Christ, Inc. , 767 N.E.2d 542, 546 (Ind. Ct. App. 2002). Nevertheless, the First Amendment “does not entirely prohibit courts from opening their doors to religious organizations.” Konkle v. Henson , 672 N.E.2d at 455. A court can apply ne utral principles of law to churches without violating the First Amendment. Id . Application of neutral principles of law to a church defendant, however, has occurred only in cases involving church property or in cases where a c hurch defendant’s actions could not haveCourt of Appeals of Indiana | Opinion 16A01-1409-PL-380 | April 8, 2015 Page 8 of 12 been religiously motivated. See Brazauskas v. Fort Wayne-South Bend Diocesse,
Inc. , 714 N.E.2d 253 (Ind. Ct. App. 1999).

[13] The trial court’s basis for granting summary judgment was that it was foreclosed by the First Amen dment from considering the issues at hand because to address such issues would have requir ed the trial court to interpret and apply religious doctrine or ecclesiastical law. Reverend Matthies contends that the trial court could avoid violating th e First Amendment prohibition against excessive entanglement by applying neutra l principles of contract law to his claims for breach of contract and failur e to pay earned wages/benefits. Thus, Reverend Matthies maintains that his cl aim can be resolved without reference to either church law or doctrine.

[14] We are not convinced by Reverend Matth ies’s argument. There is no doubt that the Terms of Call set forth in the Contract provided that Reverend Matthies would receive five weeks of vacation. The question remains, however, as to whether upon the terminat ion of his pastoral relationship by the Presbytery Reverend Matthie s was still entitled to compensation for unused vacation time. This determination necessa rily would have required inquiry into the reason for termination. See Stewart v. Kingsley Terr ace Church of Christ, Inc. , 767 N.E.2d at 547 (“[a] determination of whether an employer had good cause to terminate an employee’s employmen t contract necessarily involves a consideration of the reasons give n for the termination”) (citing Rochester Capital Leasing v. McCracken , 295 N.E.2d 375 (Ind. Ct. App. 1973)).Court of Appeals of Indiana | Opinion 16A01-1409-PL-380 | April 8, 2015 Page 9 of 12 [15] First Presbyterian cites abandonment of his pastoral duties as the impetus for termination of Reverend Matthies’s pastoral relationship with First Presbyterian. The Presbytery, through the COM, determined that the discord between Reverend Matthies and First Presbyt erian resulting from the belief that Reverend Matthies abandoned his duties had reached the point where Reverend Matthies’s pastoral relationship needed to end “in order to prevent further deterioration of the spiritual health of the church.” Appellant’s Appendix at 86. First Presbyterian therefore asserts that Reverend Matthies, having abandoned his position, breached the Agreement, th ereby relieving First Presbyterian of any further obligations under the Agr eement. Reverend Matthies denies abandoning his pastoral duties and list s his pastoral activities in the weeks leading up to his termination.

[16] To address these competing positions regarding the facts of this case would require a court to inquire in to the religious doctrine of the Presbyterian Church and its polity. A court would have to determine what the duties of a pastor called to serve a local Session and congr egation entail and then decide whether the pastor’s conduct met such standards. Essentially, the court would have to second-guess, in this case, the Presbytery as to its determination that Reverend Matthies’s pastoral relationship was detr imental to the spiritual health of the church. Indeed, the court’s inquiry woul d necessarily require it to delve into church doctrine to pass judgment on whether Reverend Matthies was fit to serve as pastor of First Presbyterian and whether the pastoral services he claimed to have provided were sufficien t to meet the standards set forth by theCourt of Appeals of Indiana | Opinion 16A01-1409-PL-380 | April 8, 2015 Page 10 of 12 Presbyterian Church. It is in this vein that this court has held that the First Amendment “proscribes intervention by secular courts into any employment decision made by religious organizati ons based on religious doctrines or beliefs.” McEnroy v. St. Meinra d School of Theology , 713 N.E.2d at 337.

[17] We conclude that the trial court properly determined that review of the issues presented would have necessitated the co urt to interpret and apply religious doctrine or ecclesiastical law. The Fi rst Amendment requires civil courts to refrain from interferin g in such matters. See McEnroy v. St. Meinrad Sch. of Theology , 713 N.E.2d 334. We therefore conclude that the trial court properly entered summary judgment in favor of First Presbyterian.

[18] Judgment affirmed.

Kirsch, J., concurs.
Crone, J., concurs in part and dissent s in part with separate opinion.Court of Appeals of Indiana | Opinion 16A01-1409-PL-380 | April 8, 2015 Page 11 of 12 

### IN THE 

# COURT OF APPEALS OF INDIANA

Steven Matthies, A

ppellan t -Plaintiff/Counterdefendant,

v. 

### The First Presbyterian Church of Greensburg Indiana, Inc., A

ppelle e -Defendant/Counterclaimant Case No. 16A01-1409-PL-380



### Crone, Judge, concurring in part and dissenting in part

[19] I agree with the majority that review ing the issues presented by Matthies’s breach of contract claim would require us to interpret and apply religious doctrine or ecclesiastical law, which is prohibited under the First Amendment. Therefore, I concur in the affirmance of summary judgment in favor of First Presbyterian on that claim.

[20] Respectfully, however, I do not beli eve that the Firs t Amendment would preclude us (or the trial court or a jury) from cons idering Matthies’s claim for unpaid vacation wages under the Wage Cl aim Statute. That claim, in my opinion, simply requires a determinat ion of whether or not there was any vacation time accrued as of the date of Matthies’s termination. If there was, I believe that claim could be viable regardl ess of the basis for his termination. Addressing that claim might involve reso lving disputed facts, interpreting theCourt of Appeals of Indiana | Opinion 16A01-1409-PL-380 | April 8, 2015 Page 12 of 12 Contract, and applying the Wage Claim Statute, but it would not involve interpreting or applying religious doctrine or ecclesiastical la w. Consequently, I would reverse the grant of summary judgment in favor of First Presbyterian on that claim. 5

5 I am unpersuaded by First Presbyterian’s argument th at the ministerial exception of the Indiana Minimum Wage Law should be read into the Wage Claims Statute. And as for First Presbyterian’s argument that the Wage Claims Statute is inapplicable be cause it is not his “employer” for pu rposes of the Statute, I believe that there is, at minimum, a genuine issue of material fact that would preclude summary judgment on that issue.