Opinion ID: 2624191
Heading Depth: 4
Heading Rank: 2

Heading: St. Paul Church, Inc. and the individually named appellants

Text: In 1983 a group of families in the Fairbanks area contacted AMC, expressing interest in forming a new UMC congregation. In a letter dated February 21, 1984 to Larry Bennett, one of the early members of St. Paul Church, Bishop Calvin D. McConnell informed Bennett: All property of United Methodist Churches is owned in trust on behalf of The United Methodist Church. There is no such thing as locally owned property. When a congregation votes to purchase real estate and to build a building on it, they obligate themselves with the financial responsibilities of such purchase and construction and continuing maintenance. But they do so as part of the connection of all United Methodists. Property is held on behalf of the denomination as a whole for its strategically missional purposes. When a new forming religious community agrees to become a United Methodist Church they agree to its constitution, Articles of Religion, and its polity and governance. Part of its polity and governance involves property being held in trust on behalf of The United Methodist Church. And also: I go into all of this to indicate that we are a connectional church. The local church is tied together with others for the mutual benefit of one another in mission to the world. Property is held in common by the denomination, with each local church assuming the responsibilities and enjoyment of using its own property, maintaining it, developing it, and improving it. If a congregation, or a portion of it, should at any point in its history decide to separate from The United Methodist Church, it could certainly do so, but could not take the title of the property with them. The property is held by the denomination to assure the means of providing continuing ministry on behalf of The United Methodist Church in that location. Bishop McConnell also referred Bennett to the paragraphs of the Discipline relating to property ownership, and he quoted with emphasis from Paragraph 2501: The United Methodist Church is organized as a connectional structure, and titles to all properties held at General, Jurisdictional, Annual, or District Conference Levels, or by a local church or charge, or by an agency or institution of the church, shall be held in trust for The United Methodist Church and subject to the provisions of its DISCIPLINE. The letter then noted: Incidentally, there have been some rather unfortunate civil suits against denominations such as United Methodist and Presbyterian to challenge this concept of property being held in trust. In every case the civil courts have upheld the denomination. I do not go into such long detail about this matter to intimidate you or discourage you, but only to inform you. It would seem important to me that your developing congregation understand the implications of the connectional nature of this undertaking in establishing a new local church. It is something that is being done together. Your group needs to be sure that it really wants to be United Methodist. If so, there are certain understandings which are inherent within it . . . [including] holding property in trust on behalf of the denomination. From January 1984 through April 1984, members of the St. Paul Church community signed a Statement of Intent which declared that they were intending to present themselves for membership in UMC and that they would worship and conduct business in accordance with The Book of Discipline of The United Methodist Church. On April 15, 1984, St. Paul was granted a Certificate of Organization by AMC, stating that it had been duly constituted according to the provisions of the Discipline of UMC. Parties to this litigation, Robert Carlson, Cam Carlson, and Thomas Hallinan, signed the Statement of Intent. St. Paul Church was incorporated as a religious corporation on November 23, 1984 under the name St. Paul United Methodist Church. The stated purposes of the corporation were to promote Christian religion, conduct public worship, conduct religious education, perform acts of charity, acquire, hold or dispose of church property and funds and perform such other lawful acts as may be necessary from time to time, subject to the Discipline of The United Methodist Church and ultimately subject to the word of God as found in the Old and New Testaments of the Bible. To receive and maintain a fund or funds of real or personal property or both and, subject to the restrictions and limitations hereinafter set forth, to use and apply the whole or any part of its income therefrom and the principle thereof exclusively for religious, charitable or educational purposes of the corporation directly. . . . The Articles of Incorporation further provided: Upon dissolution of the corporation, or upon the conclusion of its affairs, the assets of the corporation shall be distributed to such religious, charitable, or education organization(s) as the Board of Trustees may select, which are carrying on functions consistent with the purpose of this corporation. . . . Under the Articles, the Board of Trustees shall be in charge of all property of the Church and of the act of incorporating the Church. The Articles were signed by Robert F. Carlson, Trustee in Trust as Chairman of the Board of Trustees. In 1988 St. Paul Church purchased two pieces of property, a parsonage and land upon which it later built a church. Title to both properties was in the name of St. Paul United Methodist Church. Neither of the deeds contained the trust language set forth in Paragraph 2503 of the Discipline. St. Paul annually informed AMC of its failure to include the trust language in the deeds when it submitted its annual reports to the trustees of AMC, and answered no to the question whether each deed contained a trust clause. In November 1986 a letter was sent to St. Paul from the General Board of Global Ministries of the UMC (GBGM) informing that, pursuant to its application for a grant to assist with a land purchase, the GBGM had approved a $25,000 grant to St. Paul on the condition that a Trust Agreement and Mortgage be recorded against the local church as security for the donation of mission funds. The letter stated that [t]he National Division, in granting a conditional donation to a church, requires that a lien be placed upon the property for the return of the monies in the event that the property should be ever sold, alienated from The United Methodist Church, or cease to be used for church purposes. The Trust Agreement and Mortgage was signed on November 9, 1990. The introductory clauses of the Trust Agreement and Mortgage provide in relevant part: Whereas the party of the first part does hereby represent and declare that it has acquired title to, and does now hold, the premises hereinafter described, and that said premises shall be held, kept, and maintained as a place of residence for the use and occupancy of the ministers of The United Methodist Church, who may from time to time be entitled to occupy the same by appointment, and/or[] used, kept and maintained, as a place of divine worship of the United Methodist ministry and members of The United Methodist Church; subject to the Discipline, usage, and ministerial appointments of said church as from time to time authorized and declared by the General Conference of said church, and the Annual Conference within whose bounds the said premises are situated[.] The agreement later states: [I]n case [St. Paul] shall cease to be connected with The United Methodist Church, or its successor, or the corporate existence of [St. Paul] shall cease, or the property hereinafter described shall ever hereafter be alienated from The United Methodist Church, or cease to be used for or be devoted to other uses and purposes than the uses [or] purposes set forth herein, then, [St. Paul] shall and will forthwith repay to the party of the second part, the successors or assigns thereof, the said amount with lawful interest thereon, from the date of the aforesaid alienation, dissolution or abandonment.