October 3, 2018 No. 18-0438 In the Supreme Court of Texas ____________________ THE EPISCOPAL DIOCESE OF FORT WORTH, Petitioners v. THE EPISCOPAL CHURCH, Respondents ____________________ CONDITIONAL CROSS-PETITION FOR REVIEW ____________________ On Petition for Review from the Second Court of Appeals at Fort Worth, Texas No. 02-15-00220-CV _____________________ Frank Hill State Bar No. 09632000 Frank Gilstrap State Bar No. 07964000 HILL GILSTRAP, P.C. 1400 W. Abram Street Arlington, Texas 76013-1705 P: 817-261-2222 F: 817-861-4685 Attorneys for Conditional Cross- Petitioners The Local Episcopal Congregations Thomas S. Leatherbury State Bar No. 12095275 Robert P. Ritchie State Bar No. 24079213 Stephen S. Gilstrap State Bar No. 24078563 R. Kent Piacenti State Bar No. 24083660 VINSON & ELKINS LLP 2001 Ross Avenue, Suite 3900 Dallas, Texas 75201-2975 P: 214-220-7700 F: 214-999-7792 Attorneys for Conditional Cross- Petitioners The Local Episcopal Parties (cont’d on next page) FILED 18-0438 10/3/2018 4:08 PM tex-28013804 SUPREME COURT OF TEXAS BLAKE A. HAWTHORNE, CLERK
Transcript
October 3, 2018
No. 18-0438 In the Supreme Court of Texas
____________________
THE EPISCOPAL DIOCESE OF FORT WORTH,
Petitioners
v.
THE EPISCOPAL CHURCH,
Respondents
____________________
CONDITIONAL CROSS-PETITION FOR REVIEW ____________________
On Petition for Review from the Second Court of Appeals at Fort Worth, Texas
No. 02-15-00220-CV
_____________________
Frank Hill
State Bar No. 09632000
Frank Gilstrap
State Bar No. 07964000
HILL GILSTRAP, P.C.
1400 W. Abram Street
Arlington, Texas 76013-1705
P: 817-261-2222
F: 817-861-4685
Attorneys for Conditional Cross-
Petitioners The Local Episcopal
Congregations
Thomas S. Leatherbury
State Bar No. 12095275
Robert P. Ritchie
State Bar No. 24079213
Stephen S. Gilstrap
State Bar No. 24078563
R. Kent Piacenti
State Bar No. 24083660
VINSON & ELKINS LLP
2001 Ross Avenue, Suite 3900
Dallas, Texas 75201-2975
P: 214-220-7700
F: 214-999-7792
Attorneys for Conditional Cross-
Petitioners The Local Episcopal
Parties (cont’d on next page)
FILED18-043810/3/2018 4:08 PMtex-28013804SUPREME COURT OF TEXASBLAKE A. HAWTHORNE, CLERK
ii
Sandra Liser
State Bar No. 17072250
NAMAN HOWELL SMITH & LEE,
PLLC
Fort Worth Club Building
306 West 7th Street, Suite 405
Fort Worth, Texas 76102-4911
P: 817-509-2025
F: 817-509-2060
Mary E. Kostel
THE EPISCOPAL CHURCH
c/o GOODWIN | PROCTER LLP
901 New York Ave., N.W.
Washington, D.C. 20001
P: 202-346-4184
F: 202-346-4444
David Booth Beers
GOODWIN | PROCTER LLP
901 New York Ave., N.W.
Washington, D.C. 20001
P: 202-346-4224
F: 202-346-4444
Attorneys for Conditional Cross-
Petitioners The Episcopal Church
and The Most Rev. Katharine Jefferts
Schori
Daniel L. Tobey
State Bar No. 24048842
DLA PIPER LLP (US)
1717 Main Street, Suite 4600
Dallas, Texas 75201-4629
P: 214-743-4500
F: 972-813-6275
Kathleen Wells
State Bar No. 02317300
P.O. Box 101714
Fort Worth, Texas 76185-0174
P: 817-332-2580
F: 817-332-4740
iii
IDENTITY OF PARTIES AND COUNSEL
1. Plaintiffs-Respondents-Conditional Cross-Petitioners: The Episcopal
Parties (“Plaintiffs”)
Plaintiffs are the parties affiliated with The Episcopal Church, an American
religious denomination with a worldwide ministry.
a. The Local Episcopal Parties
The Local Episcopal Parties are Fort Worth Episcopalians recognized by The
Episcopal Church as the authorized leaders of the Episcopal Diocese of Fort Worth.
They are The Rt. Rev. Rayford B. High, Jr.; The Rt. Rev. C. Wallis Ohl; Robert
Hicks; Floyd McKneely; Shannon Shipp; David Skelton; Whit Smith; The Rt. Rev.
Edwin F. Gulick, Jr.; Robert M. Bass; The Rev. James Hazel; Cherie Shipp; The
Rev. John Stanley; Dr. Trace Worrell; Margaret Mieuli; Walt Cabe; Anne T. Bass;
The Rev. Frederick Barber; The Rev. Christopher Jambor; The Rev. David Madison;
Kathleen Wells, and their successors in office. The Local Episcopal Parties include
Diocesan bishops, members of the Episcopal Diocesan Standing Committee, trustees
of the Episcopal Diocesan Corporation and/or Endowment Funds, and the Diocesan
Chancellor.
iv
Represented before the trial court and in the court of appeals by:
Tab C: Judgment of the Fort Worth Court of Appeals
Tab D: First Amendment to the U.S. Constitution
Tab E: Article 13 to the Diocesan Constitution
TAB A
14025
14026
14027
14028
14029
14030
14031
14032
14033
14034
14035
14037
14038
14039
14040
14041
14042
14043
14045
14046
TAB B
353Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
them. Accordingly, we overrule Father’slast point of error.
III. Conclusion
We affirm the trial court’s judgment.
,
THE EPISCOPAL CHURCH, the LocalEpiscopal Parties, the Local Episco-pal Congregations, and the Most Rev.Katharine Jefferts Schori, Appellants
v.
Franklin SALAZAR and InterveningCongregations, Appellees
NO. 02-15-00220-CV
Court of Appeals of Texas,Fort Worth.
DELIVERED: April 5, 2018
Background: National Episcopal churchfiled suit against local diocese that had leftthe church over doctrinal differences, seek-ing title and possession to property held inname of diocese and non-profit corpora-tion. The 141st District Court, TarrantCounty, granted summary judgment tochurch. Diocese appealed. The SupremeCourt, 422 S.W.3d 646, reversed and re-manded. On remand, the District Court,John P. Chupp, J., entered summary judg-ment in favor of diocese and interveninglocal congregations. Church appealed.
Holdings: The Court of Appeals, BonnieSudderth, C.J., held that:
(1) canon of the national church, purport-ing to impose a trust on parish, mis-sion, and congregation real and person-al property, was not enforceable;
(2) where trust provided that its beneficia-ry was the diocese affiliated with na-tional church, trial court was to deferto national church’s ecclesiastical deci-sion identifying its affiliated diocese;
(3) prior to formal severance of ties, dio-cese’s possession of property was nothostile as to national church for pur-poses of adverse possession;
(4) national church lacked standing toclaim control of non-profit corporationincorporated by local diocese;
(5) body identified by the national churchas its affiliated diocese controlled ap-pointment to the corporation’s board;and
(6) claims that local diocese violated itsoaths and fiduciary duties had FirstAmendment implications renderingremedy of constructive or resultingtrust unavailable.
Affirmed in part, reversed in part, andremanded.
Gabriel, J., concurred without opinion.
1. Appeal and Error O3554The appellate court reviews a sum-
mary judgment de novo. Tex. R. Civ. P.166a(c).
2. Appeal and Error O3061(2), 4718When both parties move for summary
judgment and the trial court grants onemotion and denies the other, the reviewingcourt should review both parties’ summaryjudgment evidence and determine all ques-tions presented; the reviewing court shouldrender the judgment that the trial courtshould have rendered. Tex. R. Civ. P.166a(c).
3. Action O13‘‘Standing’’ is a threshold issue that
implicates subject matter jurisdiction, fo-cuses on the question of who may bring anaction, and presents the issue of whether a
354 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
court may consider a dispute’s merits; tohave standing, a plaintiff must be person-ally aggrieved, and his alleged injury mustbe concrete and particularized, actual orimminent, and not hypothetical.
See publication Words and Phrasesfor other judicial constructions anddefinitions.
4. Action O13
A party may be personally aggrieved,for purposes of standing, if it has a legal orequitable interest in the controversy.
5. Action O13
Without a breach of a legal right be-longing to a specific party, that party hasno standing to litigate.
6. Appeal and Error O3226, 3805(2)
The appellate court reviews standingde novo and may review the entire recordto determine whether any evidence sup-ports it.
7. Constitutional Law O1331
The transfer by statute of control overchurches, including the determinationthereby of church leadership, violates theconstitutional rule of separation betweenchurch and state. U.S. Const. Amend. 1.
8. Religious Societies O25
In resolving a church property dis-pute, the court is to confine its analysis toformal title, corporate bylaws, and otherdocuments prevalent in the management ofnon-religious entities, rather than to at-tempt to interpret internal church govern-ment—the core of which pertains not tobusiness but rather to the mysteries offaith—and to avoid ecclesiastical determi-nations like any other proverbial plague.
9. Religious Societies O24
A civil court can resolve a churchproperty dispute so long as it involves noconsideration of doctrinal matters, whether
the ritual and liturgy of worship or thetenets of faith.
10. Constitutional Law O1338In resolving a church property dis-
pute, the court must perform a non-reli-gious-doctrine-related review, within thecontext of state law, of the language of thedeeds and the provisions dealing with own-ership and control of property containedwithin the local and general churches’ gov-erning documents, i.e., the plain languageto ascertain the parties’ intent; but if thecourt attempts to divine ownership fromthe church’s ritual and liturgy of worshipor the tenets of its faith, or if interpretingthe parties’ documents would require thecourt to resolve a faith-based controversy,then it veers into constitutionally-prohibit-ed territory. U.S. Const. Amend. 1.
11. Constitutional Law O1340(1)It is constitutionally impermissible for
the government to contradict a church’sdetermination of who can act as its minis-ters. U.S. Const. Amend. 1.
12. Religious Societies O5Absent specific, lawful provisions in a
religious corporation’s articles of incorpo-ration or bylaws otherwise, whether andhow a corporation’s directors or those enti-tled to control its affairs can change itsarticles of incorporation and bylaws aresecular, not ecclesiastical matters, and anexternal entity is not empowered to amendthem absent specific, lawful provision inthe corporate documents. Tex. Bus. Org.Code § 3.009; Tex. Rev. Civ. Stat. Ann.art. 1396-2.09.
13. Religious Societies O14, 24In property dispute between national
Episcopal church and local diocese, courtswere required to defer to ecclesiasticaldecisions of the bishop of the hierarchicalreligious organization regarding which fac-tion of believers was recognized by and
355Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
was the ‘‘true’’ church loyal to the dioceseand the national church, but his decisionidentifying the loyal faction as the continu-ing parish upon schism did not necessarilydetermine the property ownership issue,and his decisions on secular legal questionssuch as the validity of the parish members’vote to amend the bylaws and articles ofincorporation were not entitled to defer-ence.
14. Constitutional Law O1328To gauge the constitutional validity of
a particular civil action involving a reli-gious organization, a court must identifythe nature of the constitutional and otherinterests at stake. U.S. Const. Amend. 1.
15. Religious Societies O14In determining whether subject mat-
ter jurisdiction exists in an action involvinga religious organization, courts must lookto the substance and effect of a plaintiff’scomplaint to determine its ecclesiasticalimplication, not its emblemata.
16. Constitutional Law O1331 Religious Societies O7
Membership in a church creates a dif-ferent relationship from that which existsin other voluntary societies formed forbusiness, social, literary, or charitable pur-poses; because a church’s autonomy inmanaging its affairs has long been afford-ed broad constitutional protections, thecourt must ask whether its decision of theissues would unconstitutionally impede thechurch’s authority to manage its own af-fairs. U.S. Const. Amend. 1.
17. Constitutional Law O1331, 1336(2)The values underlying the constitu-
tional interest in prohibiting judicial en-croachment upon a church’s ability to man-age its affairs and discipline its members,who have voluntarily united themselves tothe church body and impliedly consentedto be bound by its standards, must be
zealously protected, and when presentedwith certain conflicting interests, generallya spirit of freedom for religious organiza-tions prevails, even if that freedom comesat the expense of other interests of highsocial importance. U.S. Const. Amend. 1.
18. Religious Societies O24
Under the neutral principles method-ology, the court is required to apply neu-tral principles of law to issues such as landtitles, trusts, and corporate formation, gov-ernance, and dissolution, even when reli-gious entities are involved; what happensto the property is not an ecclesiasticalmatter, unless the congregation’s affairshave been ordered so that ecclesiasticaldecisions effectively determine the proper-ty issue.
19. Constitutional Law O1338
Whether the application of the neutralprinciples approach to a church propertydispute is unconstitutional depends on howit is applied. U.S. Const. Amend. 1.
20. Associations O5
In general, the constitution and by-laws of a voluntary association, whetherincorporated or not, are controlling as toits internal management. Tex. Bus. Org.Code §§ 1.103, 252.001.
21. Associations O5
An association’s bylaws constitute acontract between the parties. Tex. Bus.Org. Code §§ 1.103, 252.001.
22. Associations O5
The constitution and bylaws of an as-sociation confer no legal rights on non-members. Tex. Bus. Org. Code §§ 1.103,252.001.
23. Associations O7
By becoming a member of a nonprofitassociation, an individual subjects himself,within legal limits, to the association’s pow-
356 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
er to administer as well as its power tomake its rules. Tex. Bus. Org. Code§§ 1.103, 252.001.
24. Associations O13The actions of the association’s leader-
ship are permissible and binding on theassociation’s membership so long as theyare not illegal, against some public policy,or fraudulent; legislative enactment dic-tates what is public policy in Texas. Tex.Bus. Org. Code §§ 1.103, 252.001.
25. Constitutional Law O1338 Religious Societies O15.1
The law applicable to lodges, unions,or other special-purpose corporations didnot apply to a property dispute betweenthe national church and a local diocese of ahierarchical religious association. Tex.Bus. Org. Code §§ 23.001, 23.104(c); Tex.Ins. Code Ann. § 885.051.
26. Corporations and Business Organi-zations O1263
In construing corporate bylaws, acourt applies the rules that govern con-tract interpretation.
27. Corporations and Business Organi-zations O1166
A court applies the general rules ofcontract construction, as expressed in Tex-as case law, to interpret a Texas corpora-tion’s articles of incorporation.
28. Corporations and Business Organi-zations O1166, 1263
In interpreting corporate bylaws orarticles of incorporation, the court at-tempts to harmonize and give effect toevery provision, and presumes that theparties intended to impose reasonableterms.
29. Corporations and Business Organi-zations O1166, 1263
In interpreting corporate bylaws orarticles of incorporation, the court exam-
ines the document as a whole in light ofthe circumstances present when it waswritten.
30. Corporations and Business Organi-zations O1166, 1263
If a corporate bylaw or article of in-corporation is written so that it can begiven a definite interpretation, it is notambiguous and the court will construe it asa matter of law.
31. Religious Societies O14
Whether neutral principles may be ap-plied to a claim involving religious entitiesturns on the substance of the issues itraises.
32. Trusts O65
When an express trust fails, the lawimplies a resulting trust with the beneficialtitle vested in the settlor, to prevent unjustenrichment.
33. Trusts O94.5
If fraud is involved, a ‘‘constructivetrust,’’ an equitable remedy implied by op-eration of law to prevent unjust enrich-ment, may be imposed, under the theorythat equitable title should be recognized insomeone other than the holder of legaltitle.
See publication Words and Phrasesfor other judicial constructions anddefinitions.
34. Deeds O1
Texas law governs the transfer ofTexas land.
35. Trusts O373
The construction of a trust instrumentis a question of law for the court.
36. Trusts O112
In construing a trust, the court looksto the law that was in effect at the timethat the trust became effective.
357Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
37. Trusts O4Trust statutes were framed to supple-
ment rather than to supplant the desires ofa trustor.
38. Trusts O112In construing a trust, the court looks
to the words of the instrument first, seek-ing to uphold rather than destroy a trust,and then turns to statutory provisions tofill in any gaps.
39. Trusts O112Under general rules of construction, a
court avoids strictly construing a trust in-strument’s language if it would lead toabsurd results.
40. Trusts O1A court looks to the settlor’s intent to
determine whether a trust was created.
41. Trusts O112The intent of the trust settlor must be
ascertained from the language used withinthe four corners of the instrument.
42. Trusts O112A court must harmonize all terms to
properly give effect to all parts of the trustinstrument and construe it to give effect toall provisions so that none is renderedmeaningless.
43. Trusts O1Although a settlor’s manifestation of
intent to create a trust was not an expressstatutory requirement until the legisla-ture’s replacement of the Texas Trust Actwith the Texas Trust Code, the require-ment that the settlor clearly express theintention to create a trust had already longbeen embedded in case law. Tex. Prop.Code Ann. § 111.001 et seq.
44. Trusts O21(2), 25(1)There are no particular words re-
quired to create a trust if there existsreasonable certainty as to the intended
property, the subject to which the trustobligation relates, and the beneficiary, butto create a trust by a written instrument,the beneficiary, the res, and the trust pur-pose must be identified.
45. Trusts O25(1)The mere designation of a party as
‘‘trustee’’ does not create a trust.
46. Trusts O112If the trust’s language is unambiguous
and clearly expresses the settlor’s intent, itis unnecessary to construe the instrumentbecause it speaks for itself.
47. Trusts O1An entity cannot unilaterally name it-
self as the beneficiary of a trust involvinganother entity’s property.
48. Trusts O1, 9, 10While a person can establish a trust
for his or her own benefit, he or she mustown the property that is transferred inorder to create the trust. Tex. Prop. CodeAnn. § 112.001.
49. Trespass to Try Title O10An action of trespass to try title may
be brought on an equitable title.
50. Trespass to Try Title O10An owner of a superior equitable title
may recover in a trespass-to-try-title ac-tion if the record shows the equitable titleis superior to the defendant’s bare legaltitle.
51. Trespass to Try Title O6.1The plaintiff in a trespass-to-try-title
suit must recover on the strength of hisown title and not on the weakness of thedefendant’s title.
52. Trespass to Try Title O38(1)When title is controverted, the defen-
dant admits possession of the subject prop-erty but claims better title, and the burden
358 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
of proof is on the plaintiff to establish asuperior title in himself by an affirmativeshowing.
53. Adverse Possession O106(1)
Trusts O138
When a trustee’s legal title to proper-ty is adversely possessed, the equitableinterest goes with it.
54. Adverse Possession O13
Tenancy in Common O15(1)
The applicable adverse possessionstandard depends on whether the personclaiming to have adversely possessed theinterest is a stranger or a cotenant.
55. Tenancy in Common O15(1)
Cotenants must surmount a morestringent requirement to establish adversepossession, because acts of ownershipwhich, if done by a stranger, would per sebe a disseizin, are not necessarily suchwhen cotenants share an undivided inter-est; under such circumstances, the propo-nent must prove ouster, unequivocal, un-mistakable, and hostile acts the possessortook to disseize the other cotenants.
56. Trusts O1, 10
Canon of national hierarchical church,purporting to impose a trust for thechurch and its diocese on parish, mission,and congregation real and personal prop-erty, was not enforceable under Texastrust law, where national church did nothave legal title to the property at issue,and could not establish a trust for itselfwith respect to property that it did notown. Tex. Prop. Code Ann. §§ 112.001,112.004, 112.005.
57. Trusts O1, 10
An entity that does not own the prop-erty to be held in trust cannot establish atrust for itself simply by decreeing that itis the beneficiary of a trust.
58. Trusts O21(1)The required legally cognizable form
for creation of a trust is the one providedby Texas statutes and case law.
59. Religious Societies O24To identify the intended beneficiary of
trust holding legal title to real property forthe benefit of the diocese of ‘‘the Protes-tant Episcopal Church’’ within certain ter-ritorial limits, the trial court was requiredto defer to national church’s ecclesiasticaldecision identifying its affiliated diocesefollowing local diocese’s decision to disaffil-iate from the larger body of the hierarchi-cal association; the national church was thesame ‘‘Protestant Episcopal Church’’ iden-tified in deed setting forth trust, and byrejecting the larger church, diocese reject-ed any claim to items and property affiliat-ed with the church or with being an Epis-copal-affiliated diocese.
60. Religious Societies O23(3)While a decision of a religious body to
disaffiliate from a larger body in a hierar-chical church is an ecclesiastical matter,what happens to the property is not, un-less the affairs have been ordered so thatthe ecclesiastical decisions effectively de-termine the property issue. U.S. Const.Amend. 1.
61. Religious Societies O15.1A court may not consider the religious
beliefs of anyone when making a legaldetermination under neutral principles in achurch property dispute.
62. Adverse Possession O68Prior to local diocese’s formal sever-
ance of ties with national hierarchicalchurch, local diocese’s possession of realproperty was not hostile and under a claimof right inconsistent with that of nationalchurch for purposes of a claim of adversepossession. Tex. Civ. Prac. & Rem. CodeAnn. § 16.021(1).
359Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
63. Trusts O166(1)Trustee removal actions are some-
times premised on the trustee’s prior be-havior but exist to prevent the trusteefrom engaging in further behavior thatcould potentially harm the trust; as long aspotential harm to the trust remains, anaction to remove the trustee should beallowed to proceed.
64. Religious Societies O5Absent specific, lawful provisions in a
nonprofit corporation’s articles of incorpo-ration or bylaws otherwise, whether andhow a corporation’s directors or those enti-tled to control its affairs can change itsarticles of incorporation and bylaws aresecular, not ecclesiastical, matters. Tex.Bus. Org. Code § 22.102; Tex. Rev. Civ.Stat. Ann. art. 1396-2.09.
65. Religious Societies O18National body of hierarchical church
lacked standing to claim control of non-profit corporation incorporated by local di-ocese to hold property in trust for localdiocese affiliated with the national body,where corporation’s board of directors wasallowed to amend its bylaws and articles,nothing in the corporation’s documentsprovided for national church’s approvaland nothing in state law precluded theexclusion of references to the nationalchurch. Tex. Bus. Org. Code § 22.102;Tex. Rev. Civ. Stat. Ann. art. 1396-2.09.
66. Religious Societies O11Where bylaws of nonprofit corpora-
tion provided for appointment of directorsby the ‘‘body now known as’’ the localdiocese affiliated with the national hierar-chical church, it was the national church’sprerogative to determine, following localdiocese’s decision to disaffiliate from thelarger body, whether the board membersof the diocese formerly associated with thenational church had become disqualified;thus, the body identified by the national
church as its affiliated diocese controlledappointment to the corporation’s board.
67. Constitutional Law O1331 Religious Societies O18 Trusts O91
Claims that local diocese violatedoaths and fiduciary duties owed to nationalhierarchical church by its decision to disaf-filiate from the larger body due to doctri-nal differences involved questions inextri-cably intertwined with First Amendmentimplications, and thus would not supportimposition of a constructive or resultingtrust in post-schism property dispute.U.S. Const. Amend. 1.
FROM THE 141ST DISTRICT COURTOF TARRANT COUNTY, TRIALCOURT NO. 141-252083-11, HON. JOHNP. CHUPP, JUDGE
ATTORNEYS FOR THE EPISCOPALCHURCH & THE MOST REV. KATHA-RINE JEFFERTS SCHORI: MARY E.KOSTEL & DAVID BOOTH BEERS,GOODWIN PROCTER LLP, WASHING-TON, D.C., SANDRA LISER, NAMANHOWELL SMITH & LEE, PLLC, FORTWORTH, TEXAS.
ATTORNEYS FOR THE LOCALEPISCOPAL CONGREGATIONS:FRANK HILL, FRANK GILSTRAP,HILL GILSTRAP, P.C., ARLINGTON,TEXAS.
ATTORNEYS FOR THE LOCALEPISCOPAL PARTIES: THOMAS L.LEATHERBURY & DANIEL L. TO-BEY, VINSON & ELKINS LLP, DAL-LAS, TEXAS, JONATHAN D.F. NEL-SON, JONATHAN D.F. NELSON, P.C.,ARLINGTON, TEXAS, KATHLEENWELLS, FORT WORTH, TEXAS.
ATTORNEYS FOR APPELLEES:SCOTT A. BRISTER, ANDREWSKURTH LLP, AUSTIN, TEXAS, J.
360 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
SHELBY SHARPE, SHARPE & REC-TOR, P.C., FORT WORTH, TEXAS, R.DAVID WEAVER & DENA G. WEAV-ER, LAW OFFICES OF WEAVER &WEAVER, PLLC, ARLINGTON, TEX-AS.
PANEL: SUDDERTH, C.J.;GABRIEL, J.
OPINION
BONNIE SUDDERTH, CHIEFJUSTICE
I. Introduction
The parties’ long-running dispute in-volves, among other things, title to andpossession of church property.1 In 2014, ona direct appeal,2 the Supreme Court ofTexas identified the appropriate methodol-ogy to determine the property ownershipissue—neutral principles of law—and re-manded this case to the trial court. SeeEpiscopal Diocese of Fort Worth v. Epis-copal Church, 422 S.W.3d 646, 647 (Tex.2013), cert. denied, ––– U.S. ––––, 135S.Ct. 435, 190 L.Ed.2d 327 (2014); see alsoMasterson v. Diocese of Nw. Tex., 422S.W.3d 594, 596, 608 (Tex. 2013), cert. de-nied, ––– U.S. ––––, 135 S.Ct. 435, 190L.Ed.2d 327 (2014). No one disputes thatthe Corporation of the Episcopal Dioceseof Fort Worth (the Corporation) holds le-gal title to the property or that the Corpo-ration holds the property in trust for theEpiscopal Diocese of Fort Worth (EDFW).Rather, at its heart, the parties’ dispute is
over who has the right to control the Cor-poration and EDFW as legal entities.
In a single issue containing multiple sub-issues, Appellants The Episcopal Church(TEC), the Most Reverend Katharine Jef-ferts Schori, The Local Episcopal Parties,and The Local Episcopal Congregations(collectively, the TEC parties) appeal thetrial court’s summary judgment for Appel-lees Franklin Salazar and the InterveningCongregations (collectively, Appellees).3
For ease in navigating this highly com-plex case, we set forth the following road-map: Part II of this opinion containsEDFW’s history and the procedural back-ground of this case as pertinent to itsdisposition. Part III sets out the standardof review and the case’s legal framework,starting with the binding precedent of theUnited States Supreme Court and the Su-preme Court of Texas and followed bypersuasive authorities that inform ourjudgment before addressing the applicablestate substantive law on associations, cor-porations, and trusts and then applyingthese authorities to the case’s dispositiveissues in parts III.B.2–B.4. Part IV setsout in full our conclusion, which is that weaffirm the trial court’s judgment in partand reverse it in part and remand the caseto the trial court for further proceedings.
II. Background
Religious schisms that give rise to prop-erty disputes are not unprecedented.4
1. For a review of how such disputes haveaffected jurisprudence and religious groupsover the past decade, see Michael W. McCon-nell & Luke W. Goodrich, On ResolvingChurch Property Disputes, 58 Ariz. L. Rev.307, 308–10 (2016) (‘‘Hundreds of local con-gregations have voted to withdraw from thesenational denominations, raising the question:Who owns the church property?’’ (footnoteomitted)).
2. See Tex. Gov’t Code Ann. § 22.001(c) (WestSupp. 2017).
3. The Appellees include Bishop Jack Leo Iker,Jo Ann Patton, Walter Virden III, Rod Bar-ber, and Chad Bates.
4. See McConnell & Goodrich, 58 Ariz. L. Rev.at 311 & n.11 (stating that church propertydisputes are as old as any church and refer-ring to an excommunicated bishop’s refusalin 269 A.D. to relinquish control of a church
361Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
TEC, for example, was founded in 1789after its revolutionary constituents brokeaway from the Church of England. SeeEpiscopal Diocese, 422 S.W.3d at 647;Bennison v. Sharp, 121 Mich.App. 705, 329N.W.2d 466, 468 (1982); Hon. John E. Fen-nelly, Property Disputes and ReligiousSchisms: Who is the Church?, 9 St. Thom-as L. Rev. 319, 347 n.251 (1997). TheChurch of England, in turn, began withHenry VIII’s break with the Roman Cath-olic Church in 1534. Fennelly, 9 St. Thom-as L. Rev. at 347 & n.251 (referencingProtestant Episcopal Church v. Barker,115 Cal.App.3d 599, 171 Cal.Rptr. 541, 544(Cal. Dist. Ct. App.), cert. denied, 454 U.S.864, 102 S.Ct. 323, 70 L.Ed.2d 163 (1981)).And, as observed by the United StatesSupreme Court, ‘‘14 autocephalous hierar-chical churches TTT came into existencefollowing the schism of the universalChristian church in 1054.’’ Serbian E. Or-thodox Diocese for U.S. of Am. & Canadav. Milivojevich, 426 U.S. 696, 699, 96 S.Ct.2372, 2376, 49 L.Ed.2d 151 (1976); see also
Kedroff v. St. Nicholas Cathedral of Rus-sian Orthodox Church, 344 U.S. 94, 100, 73S.Ct. 143, 146, 97 L.Ed. 120 (1952) (‘‘Theschism of 1054 A.D. split the UniversalChurch into those of the East and theWest.’’).
A. The Hierarchical Church
TEC has been identified by our supremecourt as a ‘‘hierarchical’’ type of religiousorganization, composed of tiers,5
[t]he first and highest [of which] is theGeneral Convention. The General Con-vention consists of representatives fromeach diocese and most of TEC’s bishops.It adopts and amends TEC’s constitu-tion and canons. The second tier is com-prised of regional, geographically de-fined dioceses.[6] Dioceses are governedby their own conventions. Each diocese’sconvention adopts and amends its ownconstitution and canons[ ] but must ac-cede to TEC’s constitution and canons.The third tier is comprised of local con-
building and the early church’s subsequentappeal to the Roman emperor for assistance).
5. Factors Texas courts have used to charac-terize a church as hierarchical include (1) thelocal church’s affiliation with a parentchurch; (2) an ascending order of ecclesiasti-cal judicatories in which the local church’sgovernment is subject to review and controlby higher authorities; (3) subjugation of thelocal church to the jurisdiction of a parentchurch or to a constitution promulgated bythe parent church; (4) a charter from theparent church governing the affairs of thelocal church and specifying ownership of lo-cal church property; (5) the repository of legaltitle; and (6) the licensing or ordination oflocal ministers by the parent church. Green v.Westgate Apostolic Church, 808 S.W.2d 547,550–51 (Tex. App.—Austin 1991, writ denied)(citing Templo Ebenezer, Inc. v. EvangelicalAssemblies, Inc., 752 S.W.2d 197, 198–99(Tex. App.—Amarillo 1988, no writ)).
‘‘The terms hierarchical and congregationalare poles on a continuum along which churchorganizations fall.’’ Id. at 551. A congrega-
tional church is governed primarily by thewill of the local assembly, while a hierarchi-cal church submits certain issues to the rulesand control of a larger religious organization.Id. A congregational church is independent ofany other ecclesiastical association, owes noobligation to any higher authority, and ‘‘total-ly controls its own destiny.’’ Templo Ebenezer,Inc., 752 S.W.2d at 198. Because a congrega-tional form of church government vests theultimate decision-making authority in itsmembers, if the controversy cannot be decid-ed by the application of neutral principles,then the court defers to the majority vote ofthe congregation. Libhart v. Copeland, 949S.W.2d 783, 793 (Tex. App.—Waco 1997, nowrit) (explaining ecclesiastical deference incongregational church context).
6. The record reflects that TEC also groups itsdioceses into provinces, each of which con-tains a synod consisting of a house of bishopsand a house of deputies. While many of theprovinces are geographically determined,some of TEC’s provinces consist of TECdioceses outside of the United States.
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gregations. Local congregations areclassified as parishes, missions, or con-gregations.[7]
Episcopal Diocese, 422 S.W.3d at 647–48;Masterson, 422 S.W.3d at 608 (‘‘We agreewith the court of appeals that the recordconclusively shows TEC is a hierarchicalorganization.’’).
TEC’s constitution and canons ‘‘establishthe structure of the denomination andrules for how it operates.’’ Masterson, 422S.W.3d at 600. As set out in its constitutionand canons, TEC’s Presiding Bishop is its‘‘chief pastor,’’ elected by the General Con-vention—consisting of the House of Bish-ops and the House of Deputies—to a mul-ti-year term of office and ‘‘charged withresponsibility for leadership in’’ initiating,developing, and implementing TEC’s poli-cy and strategy. In addition to the Presid-ing Bishop’s policy and leadership tasks,he or she also presides over meetings ofTEC’s House of Bishops and performs ec-clesiastical tasks, including, ‘‘[i]n the eventof an Episcopal vacancy’’ in a diocese, con-sulting with that diocese’s ‘‘EcclesiasticalAuthority to ensure that adequate interimEpiscopal Services are provided.’’ The Pre-siding Bishop ‘‘shall perform such otherfunctions as shall be prescribed in’’ TEC’s
canons and may delegate some duties andresponsibilities to officers in the GeneralConvention’s Executive Council, which isresponsible for carrying out the GeneralConvention’s programs and policies andexercises ‘‘powers conferred upon it byCanon, and such further powers as may bedesignated by the General Convention.’’The Presiding Bishop is the chair andpresident of the Executive Council.
The bishop in each diocese is chosen bythe rules prescribed by the convention ofthat diocese but cannot be ordained andconsecrated without the consent of a ma-jority of the standing committees of all ofthe dioceses and without the consent of amajority of TEC’s bishops.8 If one ofTEC’s bishops abandons communion withTEC by open renunciation, formal admis-sion into any religious body not in com-munion with TEC, or other activities, sub-ject to the procedures set out in TEC’scanons and the consent of the majority ofTEC’s bishops, the Presiding Bishop maydepose that bishop.9
The convention of each diocese mustappoint a standing committee, which actsas the council of advice for the diocese’sbishop or substitutes as the diocese’s eccle-siastical authority if there is no bishop
7. This framework ignores TEC’s self-identifi-cation as a constituent member of an evenlarger community, which TEC acknowledgesin the preamble to its constitution, stating,
The Protestant Episcopal Church in theUnited States of America, otherwise knownas The Episcopal Church (which name ishereby recognized as also designating theChurch), is a constituent member of the An-glican Communion, a Fellowship with theOne, Holy, Catholic, and Apostolic Church,of those duly constituted Dioceses, Prov-inces, and regional Churches in commun-ion with the See of Canterbury, upholdingand propagating the historic Faith and Or-der as set forth in the Book of CommonPrayer. [Emphasis added.]
While occasional references are made to theAnglican Communion throughout the record
of this case, no one has explained what formof organization is involved in its membership,and no property interests are asserted on itsbehalf.
8. If a majority of the diocesan standing com-mittees or a majority of TEC’s bishops do notconsent to the bishop’s election within 120days from the date of notification of the elec-tion, the Presiding Bishop ‘‘shall declare theelection null and void,’’ and the diocesan con-vention can then proceed to a new election.
9. TEC’s governing documents define ‘‘Deposi-tion’’ as ‘‘a Sentence by which a Member ofthe Clergy is deprived of the right to exercisethe gifts and spiritual authority of God’s wordand sacraments conferred at ordination.’’
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canonically authorized to act. Under TEC’scanons, a diocese without a bishop may, byan act of its convention and in consultationwith the Presiding Bishop, ‘‘be placed un-der the provisional charge and authority ofa bishop of another diocese or of a re-signed bishop, who shall by that act beauthorized to exercise all the duties andoffices of the Bishop of the Diocese until aBishop is elected and ordained’’ for thatdiocese or until the act of the diocese’sconvention is revoked.
Each diocese’s secretary of conventionhas the responsibility to forward to thesecretary of TEC’s House of Deputies acopy of the latest journal of the diocesanconvention. Each diocese’s bishop has theduty to forward to TEC’s Recorder anannual report certifying information suchas the names of clergy canonically residentin the diocese and their status, includingsuspension, removal, deposition, or resto-ration.
TEC’s Executive Council sets a budgetthat, once approved by TEC’s GeneralConvention, is sent to each diocese, settingout each diocese’s proportionate part ofestimated expenditures. Each diocese thennotifies each parish and mission therein ofits individual ‘‘apportionment’’ to be raised,
‘‘which shall include both its share of theproposed Diocesan Budget and its share ofthe objective apportioned to the Dioceseby the Executive Council.’’ 10 Each dioceseaccounts annually to the Executive Councilfor its receipts and distributions,11 andeach diocese submits an annual report thatcontains statistical information concerningthe diocese’s parishes and missions andother ‘‘relevant information.’’ TEC estab-lished and administers a pension fund forTEC’s clergy supported by the royaltiesfrom publications authorized by the Gener-al Convention and by collections leviedupon ‘‘all Parishes, Missions, and otherecclesiastical organizations or bodies sub-ject to the authority of this Church.’’
A parish, part of the third tier identifiedby the supreme court, is governed by arector or priest-in-charge and a vestrycomprised of lay persons elected by parishmembers. Masterson, 422 S.W.3d at 600.Members of the vestry must meet certainqualifications, including committing to‘‘conform to the doctrine, discipline andworship of The Episcopal Church.’’ Id. Tobe accepted into union with TEC, a localcongregation must accede to and agree tobe subject to the constitutions and canonsof both TEC and the diocese in which thecongregation is located.12 Id.
10. The amount of ‘‘apportionment’’ suggestedby the Executive Council is based on theincome of the parishes in the dioceses, andTEC uses these funds for administration andto carry out the Church’s programs national-ly.
11. TEC makes loans to facilitate the acquisi-tion of real property and construction ofchurch buildings through various programsand entities.
12. By way of illustration, the record containsa copy of a March 15, 2002 letter from BishopIker to the rector, wardens, and vestry of oneof EDFW’s churches, informing them that‘‘[n]either the Episcopal Church nor this Dio-cese are congregational in nature’’ and thatthe vestry accordingly could not fire their
congregation’s rector. Rather, he advised thatthe vestry and rector were to work with eachother ‘‘until such time as the relationship isbroken by the death or resignation of thepriest’’ or is dissolved by the bishop ‘‘actingwith the counsel of the Diocesan StandingCommittee.’’
The record also contains the memoir ofRector Emeritus William A. Komstedt, whoobserved that ‘‘in the Bible Belt, most peoplehave a congregational understanding ofchurch administration’’ and that he was fre-quently asked why the people of the St. Fran-cis Mission would pay for land and buildingsthat EDFW would end up owning. He wrotethat ‘‘[i]n time, most warmed to the idea afterthey were taught that the diocese was like ahouse and its missions and parishes were like
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Every parish and other congregationprepares an annual report to the bishop ofits diocese, who then sends a copy toTEC’s Executive Council. The annual re-port covers not only the number of bap-tisms, confirmations, marriages, and buri-als during the year and the total numberof baptized persons and communicants ingood standing but also a summary of re-ceipts and expenditures and ‘‘such otherrelevant information as is needed to securean adequate view of the state of thisChurch, as required by the approvedform.’’ At the time that EDFW joinedTEC, ‘‘other relevant information’’ includ-ed a statement of the real and personalproperty held by each parish with an ap-praisal of its value, the parish’s indebted-ness for the property, and the amount ofinsurance carried on the property.
B. The Episcopal Diocese of FortWorth (EDFW)
1. Diocese’s Origins
In 1849, ‘‘[t]he Church in the State ofTexas accede[d] to the Constitution of theProtestant Episcopal Church in the UnitedStates of America’’ and ‘‘acknowledg[ed]its authority,’’ and in 1850, the Diocese ofTexas was admitted into union with TEC.In 1874, a missionary bishop of NorthernTexas was elected and consecrated and theDiocese of Texas was delimited to setapart the area to the north and west as theMissionary District of Northern Texas.Four years later, the 1878 Journal of theFourth Annual Convocation of the Protes-tant Episcopal Church in the MissionaryDistrict of Northern Texas set out theform for a constitution of a parish accedingto the TEC and diocesan constitutions andcanons:
This Parish, as a constituent part ofthe Protestant Episcopal Church in theMissionary District of Northern Texas,expressly accedes to, recognizes andadopts the Constitution, Canons, Doc-trines, Discipline and Worship of theProtestant Episcopal Church in theUnited States of America, and the Con-stitution and Canons of the ProtestantEpiscopal Church in this jurisdiction,and acknowledges their authority ac-cordingly.
In 1893, TEC’s constitution providedthat no churches or chapels would be con-secrated until the bishop sufficiently certi-fied that the property was ‘‘secured, by theterms of the devise, or deed, or subscrip-tion by which they are given, from thedanger of alienation, either in whole or inpart, from those who profess and practisethe doctrine, discipline, and worship of theProtestant Episcopal Church in the UnitedStates of America.’’
Two years later, the Diocese of Dallasheld its first diocesan convention. Thepreamble to its originating December 1895constitution states,
We, the Clergy and Laity, of the Prot-estant Episcopal Church, in the UnitedStates of America, resident in that por-tion of the State of Texas which, by theGeneral Convention of said Church, wasin the year A.D. 1874 set off as theMissionary District of Northern Texas,having been convened by the MissionaryBishop of Northern Texas, for the pur-pose of organizing a Diocese whose ter-ritorial limits shall be co-extensive withthose of said Missionary District, donow, by and with the consent of saidBishop and in order to effect the organi-
rooms in it.’’ He also described the effortstaken by the mission’s congregation to pay offthe $31,500 no-interest, five-year loan ob-tained from one of TEC’s programs, wiping
out $21,000 of the debt in one night by hold-ing a gala Barbeque, Country Dance, andWild West show.
365Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
zation of said Diocese, ordain and estab-lish this Constitution.
Over half a century later, at its 53rdannual convention held in 1948, the Dio-cese of Dallas amended its constitution’sarticle 13, ‘‘On Title to Church Property.’’That article provided that title to all realproperty acquired ‘‘for the use of theChurch in this Diocese,’’ including the realproperty of all parishes and missions,‘‘shall be vested in the Bishop and hissuccessors in office, in trust.’’ 13
More than three decades after that, inJune 1982, the Diocese of Dallas held aspecial convention to consider a resolutionto divide itself and, if approved, to requestthat TEC’s General Convention ratify thedivision.14 The resolution passed.
TEC held its General Convention thatsame year, from September 5 to 15, 1982.On the fourth day, the motion to adoptResolution B-18, providing for the divisionof the Diocese of Dallas, carried in theHouse of Bishops. On the seventh day, theHouse of Deputies concurred, ratifying thedivision to create EDFW (known at thattime only as the ‘‘Western Diocese’’) basedon, among other things, the certificate ofthe Diocese of Dallas’s Chancellor that allof the requisite documents had been exe-
cuted and ‘‘that all of the appropriate andpertinent provisions of the Constitutionand Canons of the General Convention ofthe Episcopal Church in the USA and theConstitution and Canons of the Diocese ofDallas have been fully complied with inrespect of this submission.’’
The October 1982 Annual Meeting Jour-nal of the Diocese of Dallas reflected thatseventy-two years after the division issuewas first raised in 1910, the Diocese ofDallas was finally sharing ‘‘in the traumaand excitement of such a division,’’ result-ing, at least in part, from the area’s signifi-cant population growth over time and thesize of the diocese (larger than 43 otherdioceses, including some dioceses that cov-ered entire states).15 Bishop Davies ob-served that the General Convention hadratified the action of the diocesan conven-tion when it voted to divide the Diocese ofDallas, that the new diocese planned tocome into existence as of January 1, 1983,with the filing of its documents with theSecretary of TEC’s General Convention,and that the new diocese would hold itsprimary convention on November 13, 1982,to name itself, organize committees andofficers, accede to the national constitution
13. Alexander C. Garrett, who had been theMissionary Bishop of Northern Texas, servedas the Bishop of Dallas from 1874 to 1924and was succeeded in that office by Harry T.Moore (who served from 1924 to 1946),Charles Avery Mason, (who served from 1946to 1970), and A. Donald Davies (who servedfrom 1970 until 1982, when Bishop Daviesopted to become the bishop of the newlyformed EDFW). Clarence C. Pope served inthe office of EDFW’s bishop from 1986 until1994, when he retired to become a RomanCatholic. Bishop Iker was elected by EDFW’sconvention as bishop coadjutor in 1992 butwas not consecrated until 1993, when he re-ceived consent from TEC’s other dioceses.
14. Under Article V of TEC’s constitution, oneof the three ways that a new diocese may be
formed is through the division of an existingdiocese with the consent of the General Con-vention ‘‘and under such conditions as theGeneral Convention shall prescribe by Gener-al Canon or Canons.’’ Under TEC’s constitu-tion, a new diocese may also be formedthrough the joining of two or more diocesesor parts thereof or from mission territory,which is ‘‘an unorganized area evangelized’’by TEC but not yet included in any of TEC’sdioceses.
15. In his address to the diocesan convention,Bishop Davies noted that the ‘‘twin cities ofDallas and Fort Worth are growing like younggiants’’ and that ‘‘[t]he little towns in betweenare stretching out their steel fingers with em-erald rings strung all along to bind each othertogether in bonds of common life.’’
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and charters, adopt its own constitutionand charters, and implement a budget.
One of the resolutions promulgated atthe Diocese of Dallas’s October 1982 Annu-al Meeting declared that ‘‘[t]itle to all realproperty TTT located within the territorialboundaries of the western diocese shall betransferred to the western diocese.’’ 16
During the meeting, the Diocese of Dal-las’s Chancellor was granted permission toinitiate and conduct for the diocese ‘‘suchaction in the courts of the State of Texasas may be necessary and prudent for theaccomplishment of the goals and purposesof the foregoing resolution, including parti-tion actions, cy-pres actions, and other ac-tions under the laws of Texas or the Unit-ed States.’’ Additionally, the resolutionprovided that the division of all corpora-tions, foundations, and funds ‘‘shall bemade subject to the terms, conditions[,]and purposes of the instruments establish-ing them and any amendments thereto.’’
EDFW adopted its constitution and can-ons on November 13, 1982. It was admit-ted into union with TEC on December 31,1982.
2. 1983–1990
Article 13 of EDFW’s constitution pro-vided that ‘‘title to all real estate acquiredfor the use of the Church in this DioceseTTT shall be held subject to control of theChurch in the Episcopal Diocese of FortWorth acting by and through a corpora-tion’’ and that ‘‘[a]ll such property as wellas all property hereafter acquired for theuse of the Church and the Diocese, includ-ing parishes and missions, shall be vested
in [the] Corporation of the Episcopal Dio-cese of Fort Worth.’’ 17 EDFW’s canonsestablished the parameters for the Corpo-ration’s management. See Episcopal Dio-cese, 422 S.W.3d at 648. Specifically, canon11, ‘‘Corporation of the Episcopal Dioceseof Fort Worth,’’ set out,
Sec. 11.1 Corporation of the EpiscopalDiocese of Fort Worth is a non-profitbenevolent[18] and charitable organiza-tion organized under Texas laws, alsoknown as the ‘‘Diocesan Corporation’’.In addition to its regular powers, it mayreceive, hold, manage and administerfunds and properties acquired by gift orby will or otherwise for the use andbenefit of the Diocese and any DiocesanInstitutions.
Sec. 11.2 The management of its af-fairs shall be conducted and adminis-tered by a Board of Trustees of five (5)elected members, all of whom are eitherLay persons[19] in good standing of aparish or mission in the Diocese, ormembers of the Clergy canonically resi-dent in the Diocese, in addition to theBishop of the Diocese who shall serve asChairman of the Board or may desig-nate the President or other officer of thecorporation to serve as such. The Boardof Trustees shall have the power andauthority to conduct the affairs of saidcorporation in accordance with its char-ter and by-laws and in accordance withthe Constitution and Canons of the Dio-cese from time to time adopted.
Sec. 11.3 One member of the Board ofTrustees shall be elected at each Annual
16. The resolution provided that title to allsuch real property would be transferred ex-cept for some small oil and gas interestsowned by Episcopal Funds, Inc., and the advalorem tax liability of Camp Crucis, whichwould be divided 65/35 between the twodioceses.
17. The Diocese of Dallas adopted a similarprovision in December 1983.
18. ‘‘Benevolent’’ was removed from the can-on in 1989.
19. ‘‘Persons’’ was changed to ‘‘communi-cants’’ in 1989.
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Convention and each member shallserve a term of five (5) years. The termsof members shall be so arranged thatthe term of only one (1) member shallexpire annually. The Board of Trusteesshall fill any vacancy which occurs onthe Board until the annual election. TheBishop shall nominate the members ofthe Board of Trustees.
Sec. 11.4 The Board of Trustees shalladopt its own by-laws and shall electsuch officers as its by-laws may require.
Sec. 11.5 The Board of Trustees shallsubmit a report at each Annual Conven-tion covering its operations for the pre-ceding fiscal year and showing its finan-cial condition. If and when required bythe Standing Committee of the Diocese,the Board of Trustees shall make suchadditional reports and furnish such addi-tional information as may [be][20] re-quested. The books and records of theBoard of Trustees shall at all times beopen for inspection and examination bythe Standing Committee of the Dioceseor its representatives.
EDFW filed articles of incorporation forthe Corporation on February 28, 1983. The1983 articles established that the Corpora-tion was a nonprofit corporation of perpet-ual duration with the following purposesset out as follows, in pertinent part:
(1) To receive and maintain a fund orfunds or real or personal property, orboth, from any source including all realproperty acquired for the use of theEpiscopal Diocese of Fort Worth aswell as the real property of all parishes,missions and diocesan institutions. Sub-ject to the limitations and restrictionshereinafter set forth, to use and applythe whole or any part of the incometherefrom and the principal thereof ex-clusively for charitable, religious, scien-
tific, literary, or educational purposeseither directly or by contributions to or-ganizations that qualify as exempt or-ganizations under Section 501(c)(3) ofthe Internal Revenue Code and its Reg-ulations as they now exist or as theymay hereafter be amended.
(2) The property so held pursuant to(1) supra shall be administered in accor-dance with the Constitution and Canonsof the Episcopal Diocese of Fort Worthas they now exist or as they may hereaf-ter be amended.
The articles also set out that the electionof the Corporation’s board of directors(‘‘Board of Trustees’’) and their terms ofoffice ‘‘shall be fixed by the by-laws of thecorporation as the same may be adoptedand from time to time amended.’’
The Corporation adopted its bylaws onMay 17, 1983. Article I, ‘‘Authority,’’states,
Section 1. General The affairs of thisnonprofit corporation shall be conductedin conformity with the Constitution andCanons of the Episcopal Church in theUnited States of America and the Con-stitution and Canons of the EpiscopalDiocese of Fort Worth, as they may beamended or supplemented from time totime by the General Convention of theChurch or by the Convention of theDiocese. In the event of any conflictbetween these Bylaws and any part orall of said Constitution or Canons, thelatter shall control.
The bylaws conferred general power toperform all lawful acts and things ‘‘as arenot by statute or by the Articles of Incor-poration or by these Bylaws prohibited.’’With regard to the number and election ofthe board of directors and their terms ofoffice, the bylaws paralleled EDFW’s con-
20. By 1989, this typographical error in the original 1982 canon had been corrected.
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stitutional and canonical provisions, stat-ing,
The Bishop of the Diocese of FortWorth shall be the Chairman of theBoard of Trustees of the Diocesan Cor-poration. In addition to the Bishop thenumber of elected Trustees which shallconstitute the Board shall be five. Theterm of office for each elected Trusteeshall be for five years and each Trusteeshall hold office from the date of hiselection until his successor shall havebeen duly elected and qualified, or untilhis death, resignation, disqualification orremoval. There shall be elected at eachannual meeting one Trustee. Trusteesmay be either lay persons in good stand-ing of a parish or mission in the Dioceseof Fort Worth, or members of the Cler-gy canonically resident within the Dio-cese, in addition to the Bishop.
See Tex. Bus. Orgs. Code Ann. § 22.207(West 2012) (‘‘Election and Control byCertain Entities’’). The bylaws also provid-ed for holding regular meetings and spe-cial meetings whenever called by the Pres-ident—designated in the bylaws as thechairman of the board—‘‘or by any twoTrustees.’’ They further provided that thequorum necessary to transact businesswould be not less than a majority of thetotal number of trustees then acting andset forth the procedures for resignation,board vacancies, and the removal of trus-
tees: ‘‘Any Trustee of the Diocesan Corpo-ration may be removed by the Bishop ofthe Diocese of Fort Worth.’’ The bylawsalso included a provision for amendment,stating,
These Bylaws may be amended, altered,changed, added to or repealed, in wholeor in part, by the affirmative vote of amajority of the total number of Trusteesat any regular or special meeting of theBoard, if notice of the proposed changeis included in the notice of such meeting.
In 1984, a civil court judgment trans-ferred part of the Diocese of Dallas’s realand personal property to EDFW and vest-ed legal title of the property in the Corpo-ration,21 except for certain assets for whichthe Diocese of Dallas’s bishop and his suc-cessors had been designated as trustee;those assets transferred to EDFW’s bish-op as trustee and to his successors inoffice.22 Episcopal Diocese, 422 S.W.3d at648.
3. 1991–2005
Less than ten years after its admissioninto union with TEC, conflicts based ondiffering theological views began to arisebetween both TEC and EDFW andEDFW and some of its congregations.
In 1991, the Episcopal Church of St.Mary the Virgin withdrew from TEC andEDFW to join a Roman Catholic Diocese.23
21. The 1984 judgment likewise vested legaltitle of the property remaining with the Dio-cese of Dallas in the Corporation of the Epis-copal Diocese of Dallas.
22. The Diocese of Dallas and its diocesancorporation, EDFW and its diocesan corpora-tion, and the Dioceses’ bishops as trusteeswere parties to the 1984 judgment. In the1984 judgment, the trial court stated, ‘‘Noth-ing in this judgment shall be deemed to dealwith, or otherwise affect, properties, real orpersonal, disposed of under testamentary orinter vivos gift executed or effective prior toDecember 31, 1982, which bequest is to the
Diocese of Dallas or the Bishop thereof,’’ butit also noted that the two dioceses had re-solved that their ‘‘various assets, properties,investments, trusts and related matters’’would be divided in an equitable manner.
23. EDFW’s standing committee unanimouslyrecommended that the parish be allowed towithdraw upon receipt and review of properdocumentation, and in 1993, the standingcommittee approved the Roman Catholic Dio-cese’s board of trustees’ resolution to pay offthe loan on the former Episcopal parish’sproperty and to transfer title to the propertyto the Roman Catholic Diocese.
369Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
And at a standing committee meeting, af-ter TEC assigned an apportionment ofapproximately $230,000 to EDFW, thecommittee noted that ‘‘the withholding ofapportionment is regarded by some assanctions against immorality.’’ The com-mittee agreed to allow the individual par-ishes within EDFW to choose whether tofund TEC’s Executive Council’s activitiesby apportionment through vestry actionindicating whether the individual parish’spercentage of the diocesan assessmentwould be forwarded to TEC’s ExecutiveCouncil or should remain under EDFW’scontrol.
During the 1990s, the standing commit-tee received a letter from another diocesethat ‘‘encouraged the Diocese of FortWorth to remain in the Episcopal Church’’and other correspondence ‘‘from thosedioceses questioning the intentions of[EDFW] of remaining in the EpiscopalChurch in the United States of Americaand the reasons why [EDFW] had reducedits apportionment to the Executive Coun-cil’s program.’’
In 1992, the rector and vestry of HolyApostles Episcopal Church, one ofEDFW’s parishes, announced the parish’sintent to seek membership in the Antio-chean Orthodox Church and to sever itsrelationship with EDFW, TEC, and ‘‘therest of the Anglican Communion.’’ 24
Around then, EDFW’s standing committee
discussed developing a ‘‘future strategy re-garding a parish that may try to leave andtake diocesan property with them,’’ and inearly 1994, the committee finalized themembership of a ‘‘Protection of DiocesanProperty Committee.’’ 25 The president ofthe standing committee was named as theproperty protection committee’s chairman.Also during the same time period, thestanding committee questioned whether ithad veto power over the Corporation’strustees. At their June 1993 meeting, thestanding committee received the answer toits question—after a lengthy discussion be-tween Canon James DeWolfe, Bishop Iker,and the Corporation’s trustees, it was de-termined that the Corporation’s trustees‘‘had final authority in matters concerningDiocesan property.’’
By 2000, TEC’s General Convention hadformed a task force to visit EDFW regard-ing the implementation of some of TEC’sresolutions. In 2000 and 2001, the standingcommittee was faced with ecclesiasticalcharges involving Samuel L. Edwards, oneof the priests then canonically resident inEDFW. Edwards had moved from Texasto begin acting as the rector of a parish inthe Diocese of Washington despite havingnot been licensed to do so by the bishoppro tempore of the diocese in which thatparish was located. See Dixon v. Edwards,290 F.3d 699, 703, 705, 707 (4th Cir.2002).26 On December 17, 2001, the stand-ing committee issued a presentment
24. The standing committee agreed that theHoly Apostles rector and vestry had leftthem ‘‘no choice but to pursue in the man-ner required under the Canons of the Epis-copal Church and the Diocese of FortWorth,’’ including obtaining a temporary re-straining order and notices to inhibit and toexcommunicate. Three years later, a negoti-ated settlement cut short litigation betweenEDFW and the breakaway parish and re-turned full possession of the property inquestion to EDFW.
25. Later in 1994, one of the standing commit-tee’s members, the Reverend Keith L. Acker-man, resigned to become the Bishop of theDiocese of Quincy, which subsequently facedproperty issues similar to the ones in theinstant case. See Diocese of Quincy v. Episco-pal Church, 2014 IL App (4th) 130901, ¶¶ 1,383 Ill.Dec. 634, 14 N.E.3d 1245, 1249–50(Ill. App. Ct. 2014), appeal denied, 386 Ill.Dec.794, 21 N.E.3d 713 (Ill. 2014).
26. A federal lawsuit filed not long after theecclesiastical charges against Edwards weretransferred to EDFW sought a declaration
370 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
against Edwards on one of the three eccle-siastical charges, id. at 707, and the follow-ing year the standing committee consentedto Edwards’s deposition.
In 2003, EDFW continued to object toactions by TEC and other dioceses withwhich it disagreed, and the standing com-mittee unanimously agreed ‘‘to work to-gether in initiating a gathering TTT in[EDFW] of the Network of ConfessingDioceses in order to work on the realign-ment of the Anglican Communion.’’ Thestanding committee met with a bishop ofthe Reformed Episcopal Church (REC) inMay 2003, and decided to meet with RECin the future to further discuss their rela-tionship.27
EDFW was not the only diocese experi-encing strife in its relationship with TEC
during this time. In addition to the Dioceseof Quincy 28 and the Diocese of Pitts-burgh,29 which were experiencing theirown differences with TEC, in 2004, theDiocese of San Joaquin began the processof amending its governing documents, in-cluding the articles of incorporation for‘‘the corporation sole,’’ which held title tothe diocese’s trust funds and real property,redefining how the vacancy of a bishop wasto be filled, and omitting the requirementsthat the local choice of bishop be approvedby the national church as provided inTEC’s constitution and canons. See Dio-cese of San Joaquin v. Gunner, 246 Cal.App.4th 254, 202 Cal.Rptr.3d 51, 56–57(2016, pet. denied) (op. on reh’g). Never-theless, even as St. Michael’s EpiscopalChurch in Fort Worth considered holding
that Edwards was not the parish’s rectorbased on his not being found ‘‘duly qualified’’under a TEC canon, in part on Edwards’shaving advised the bishop pro tempore that‘‘he would not guarantee her that he wouldnot attempt to lead Christ Church out of[TEC] or attempt to take Church property aspart of that effort.’’ Dixon, 290 F.3d at 703,705–08 & nn.5, 8. Along with then-Bishop ofthe Diocese of Pittsburgh Robert WilliamDuncan Jr., Bishop Iker filed an amicus briefin the federal suit in support of Edwards onJanuary 8, 2002. In the brief, the two bishopsstated that an Episcopal bishop ‘‘is governedby the constitution and canons of the Church’’and that an Episcopal bishop does not act‘‘independently of the checks and balances ofthe legal system of which they are a part. Abishop must adhere to the constitution andcanons of the Church or be subject to disci-pline.’’ They also stated that ‘‘[t]he dioceseshave canons that cannot be inconsistent withnational canons.’’ The district court awardedsummary judgment to Washington’s bishoppro tempore, and the Fourth Circuit affirmedthe district court’s judgment in May 2002. Id.at 703.
Presiding Bishop Schori deposed Duncanon September 19, 2008, and on October 4,2008, the majority of the Pittsburgh Diocesevoted to secede from TEC and align with theAnglican Province of the Southern Cone. Cal-
vary Episcopal Church, Pittsburgh v. Duncan,No. 293 C.D. 2010, 2011 WL 10841592, at *2,*5 (Pa. Commw. Ct. Feb. 2, 2011) (construing‘‘the Episcopal Diocese of Pittsburgh of theEpiscopal Church of the United States ofAmerica’’ as used in stipulation to mean theloyalist faction that remained with TEC), ap-peal denied, 612 Pa. 705, 30 A.3d 1193 (Pa.2011).
27. REC was organized in 1873 after a schismwith TEC. See The Reformed EpiscopalChurch, An Overview of the REC, http://www.recus.org/about.html (last visited Mar. 28,2018). REC’s vision, as set out in a paper byits bishop that was distributed at a 2003standing committee meeting, was the forma-tion of an Anglican Province of America out-side of TEC.
28. See Diocese of Quincy, 2014 IL App (4th)130901, ¶ 9, 383 Ill.Dec. 634, 14 N.E.3d at1250 (‘‘Over the years a doctrinal controversydevelopedTTTT’’).
29. See Calvary, 2011 WL 10841592, at *1(noting that in 2003, Calvary EpiscopalChurch filed a complaint against Duncan andmembers of the Diocese of Pittsburgh’s stand-ing committee, alleging that they ‘‘intended toextinguish the property rights and interestsof’’ TEC).
371Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
a parish vote to leave TEC and affiliatewith the Anglican Church in America, in2005, Bishop Iker and the standing com-mittee still expressed hope that ‘‘all of uswill stand together during this time ofdifficulty in the Episcopal Church.’’
4. 2006–2008
In June 2006, immediately after Presid-ing Bishop Schori’s election, Bishop Ikerand the standing committee approved thefollowing statement,
The Bishop and the Standing Commit-tee of the Episcopal Diocese of FortWorth appeal in good faith to the Arch-bishop of Canterbury, the Primates ofthe Anglican Communion, and the Panelof Reference for immediate alternativePrimatial Oversight and Pastoral Carefollowing the election of Katharine Jef-ferts Schori as Presiding Bishop of theEpiscopal Church.
This action is taken as a cooperativemember of the Anglican CommunionNetwork in light of the Windsor Reportand its recommendations.
A month later, Bishop Iker discussedwith the standing committee a recentmeeting of EDFW’s Constitution and Can-ons Committee and its proposed resolu-tions, additions, and changes to EDFW’sconstitution and canons ‘‘in light of recentdevelopments in our Church,’’ which wouldbe submitted to the diocesan convention inNovember 2006.30
On August 15, 2006, the Corporationamended its bylaws to remove all refer-ences to TEC. Episcopal Diocese, 422S.W.3d at 648. Article I, ‘‘Authority,’’ wasamended to provide that the Corporation’saffairs
shall be conducted in conformity withthe body now known as the EpiscopalDiocese of Fort Worth’s acknowledg-ment of and allegiance to the One, Holy,Catholic and Apostolic Church of Christ;recognizing the body known as the An-glican Communion to be a true branchof said Church; with all rights and au-thority to govern the business and af-fairs of the Corporation being solely inthe board of trustees (as hereinafter de-fined, the ‘‘Board’’) of the Corporation.
This amendment also deleted the referenceto ‘‘the Constitution and Canons of theEpiscopal Church in the United States ofAmerica and the Constitution and Canonsof the Episcopal Diocese of Fort Worth.’’A new section was added to Article II,‘‘Directors,’’ which stated,
Section 2. The Bishop. The bishop rec-ognized by the body now known as theEpiscopal Diocese of Fort Worth (the‘‘Bishop’’) shall be a trustee and a mem-ber of the Board. The Bishop shall bethe Chairman of the Board of the Corpo-ration.
In the event of a dispute or challengeregarding the identity of the Bishop ofthe body now known as the EpiscopalDiocese of Fort Worth, the ElectedTrustees (as hereinafter defined in Arti-cle II, Section 3) shall have the soleauthority to determine the identity ofthe Bishop for purposes of the Corpora-tion’s Articles of Incorporation, asamended from time to time, and theseBylaws.
In the event the body now known asthe Episcopal Diocese of Fort Worth iswithout a Bishop, a majority of theElected Trustees shall have the sole au-
30. In July 2006, Bishop Iker, along with thebishops of Dallas, Pittsburgh, San Joaquin,South Carolina, Springfield, and Central Flor-ida, appealed to the Archbishop of Canter-bury, asserting, ‘‘Seven dioceses are seeking
to reshape their life together as dioceses TTT
under the oversight of a Canterbury appoint-ed Commissary, temporarily exercising someof the responsibilities normally assigned tothe American primate.’’
372 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
thority to appoint a Chairman of theBoard who shall, for purposes of theCorporation’s Articles of Incorporation,as amended from time to time, and theseBylaws, have all the rights and privi-leges of the Bishop of the body nowknown as the Episcopal Diocese of FortWorth.
If a determination pursuant to thisArticle II becomes necessary in the dis-cretion of any member of the Board, theBoard member may call a special meet-ing of the Board, subject to the noticeprovisions set forth in these Bylaws, forthe purpose of making the determina-tion. The vote of a majority of membersof the Board present at the specialmeeting, wherein a quorum is present,shall be decisive.
There was no change to the number,election, or terms of office for trusteesother than to clarify that the trustees, whowere elected at a rate of one per annualmeeting, could be either lay persons ingood standing of a parish or mission ‘‘inthe body now known as the Episcopal Dio-cese of Fort Worth’’ or members of theclergy ‘‘canonically resident within thegeographical region of the body nowknown as the Episcopal Diocese of FortWorth.’’ The rest of the sections remainedsubstantively unchanged except for thesection pertaining to removal of trustees.While the previous version of the sectionprovided that any trustee could be re-moved by the bishop, the amended sectionstated that any elected trustee could beremoved by a majority of the remainingmembers of the board. The amended by-laws also stated, ‘‘These Bylaws were con-sidered and unanimously approved at theBoard’s annual meeting August 15, 2006,at which every Board member was pres-ent.’’
On September 5, 2006, the Corporation’sboard likewise amended the Corporation’s
articles of incorporation. Id. The preamblerecited that articles IV, V, and VI hadbeen revised and approved by a unanimousvote by the board on August 15, 2006.
Section 1 of article IV was amended tostate that the Corporation was organized‘‘[t]o receive and maintain a fund or fundsor real or personal property, or both, fromany source,’’ deleting the portion of theearlier article that specified that ‘‘anysource’’ included ‘‘all real property ac-quired for the use of [EDFW] as well asthe real property of all parishes, missionsand diocesan institutions.’’
Section 2 of article IV was amended tostate that the property held under section1 ‘‘shall be administered in accordancewith the Bylaws of the Corporation as theynow exist or as they may hereafter beamended,’’ deleting reference to EDFW’sconstitution and canons. Article VI incor-porated a provision to identify the Corpo-ration’s chairman, paralleling and refer-encing the amended bylaws. Article VIalso listed the names of the trustees serv-ing at that time: Salazar, Barber, Bates,Virden, Patton, and Bishop Iker. Accord-ing to Virden, the 2006 amendments to theCorporation’s bylaws ‘‘were not adopted aspart of any plan to withdraw from TEC, asthose discussions did not begin until thesummer of 2007.’’
On October 19, 2006, Presiding BishopSchori informed Bishop Iker that some ofthe provisions in EDFW’s constitution andcanons were contrary to TEC’s constitu-tion and canons and that those provisionsneeded to be changed. Otherwise, Presid-ing Bishop Schori said that she would haveto consider what sort of action to take tobring EDFW into compliance. On Novem-ber 15, 2006, TEC’s Executive Council re-ceived a task force report identifyingEDFW as a ‘‘problem diocese’’ that neededto be monitored.
373Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
On June 14, 2007, TEC’s ExecutiveCouncil declared some of EDFW’s consti-tutional and canonical amendments to be‘‘null and void.’’ Four days later, BishopIker and the standing committee releaseda statement noting that an adversarial re-lationship had developed between EDFWand TEC, asserting that TEC’s ExecutiveCouncil ‘‘ha[d] no legislative authority, andits resolutions [were] not binding on any-one,’’ and further positing that it was theExecutive Council’s resolution ‘‘in thismatter that is null and void, and it is of noforce or effect in this Diocese.’’
On November 8, 2007, the week beforeEDFW’s November 17, 2007 Annual Con-vention, Presiding Bishop Schori publishedan open letter to Bishop Iker, stating thatseveral of the proposed changes toEDFW’s constitution would violate the re-quirement in TEC’s constitution for thediocese’s ‘‘unqualified accession.’’ 31 In theletter, she warned Bishop Iker of the po-tential canonical consequences and askedhim to lead EDFW ‘‘on a new course thatrecognizes the interdependent and hierar-chical relationship between the nationalChurch and its dioceses and parishes’’ in-stead of in a direction ‘‘that would purport-edly permit [EDFW] to depart from[TEC].’’ The Episcopal Church, FortWorth bishop receives notice of possibleconsequences if withdrawal effort contin-ues (Nov. 8, 2007), at https://www.episcopalchurch.org/library/article/fort-worth-bishop-receives-noticepossible-consequences-if-withdrawal-effort.
On November 12, 2007, Bishop Iker re-sponded by publishing his own open letter,in which he stated,
While I do not wish to meet antago-nism with antagonism, I must remindyou that 25 years ago this month, thenewly formed Diocese of Fort Worthvoluntarily voted to enter into unionwith the General Convention of theEpiscopal Church. If circumstances war-rant it, we can likewise, by voluntaryvote, terminate that relationship. Youraggressive, dictatorial posturing has noplace in that decision. Sadly, however,your missive will now be one of thefactors that our Convention will consideras we determine the future course ofthis diocese for the next 25 years andbeyond, under God’s grace and guid-ance.
The Episcopal Diocese of Fort Worth, Aletter from Bishop Iker to the PresidingBishop (Nov. 12, 2007), at http://www.fwepiscopal.org/bishop/bishoppbreply.html.
In his November 17, 2007 address at theAnnual Convention, Bishop Iker recountedthe Executive Council’s resolution andstated ‘‘that such declarations exceededthe authority of the Executive Council,which is responsible for the program andbudget of the General Convention, andthat they had no legislative or judicialauthority to make such a pronouncement.’’Bishop Iker stated, ‘‘The Council’s declara-tion about the legitimate legislative pro-cess in this Diocese is, in fact, null andvoid.’’ Bishop Iker also voiced his objection‘‘to the claim that the Presiding Bishop hasany canonical authority in this Diocese orany legitimate power over the leadershipof this Diocese’’ and stated that ‘‘[t]here isno such thing as ‘the national Church,’ ’’but rather a confederation of dioceses.
31. In the interest of time, instead of request-ing that the already voluminous record besupplemented, we have opted to take judicialnotice sua sponte of Presiding Bishop Scho-ri’s letter and Bishop Iker’s response—both of
which were published on the internet andreferenced, but not included, in the record—for the sole purpose of providing context forthe parties’ dispute. See Tex. R. Evid. 201.
374 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
At the standing committee’s follow-upmeeting on November 19, 2007, BishopIker expressed his desire that his conven-tion address be shown in all of EDFW’sparishes and missions prior to each con-gregation’s annual parish meeting. Thestanding committee discussed with BishopIker ‘‘the need to begin immediate study ofthe Constitution and Canons of the Prov-ince of the Southern Cone.’’
In January 2008, Bishop Iker sent adirective to appoint clerical members ofthe standing committee plus four rectors‘‘who have said they want to remain inTEC and four who believe it is time toseparate,’’ asking for their assistance inaddressing conflicts in EDFW ‘‘concerningthe plan to separate from The GeneralConvention of The Episcopal Church.’’Three months later, at the March 2008meeting, the standing committee also dis-cussed, among other things, ‘‘the currentsituation in the Diocese of San Joaquin.’’ 32
A month later, the committee’s notesreflect that Bishop Iker was ‘‘trying towork out a pastoral plan and provision’’ forthe parishes ‘‘who may wish to remain inTEC following [the] November DiocesanConvention,’’ with the assistance of Dal-las’s bishop and standing committee. Bish-op Iker and the standing committee sent aletter to the Internal Revenue Service toinform the IRS that EDFW ‘‘no longerdesires to be included under the groupruling of the Protestant Episcopal Churchof the United States of America.’’ In May2008, the standing committee approved a
new civil employment contract with BishopIker and ended the former employmentagreement.
Reverend Buchanan declared in his affi-davit that in 2008, prior to EDFW’s pur-ported disaffiliation, TEC’s House of Bish-ops had ‘‘affirmed that diocesan leadershave no authority to remove their diocesesfrom The Episcopal Church.’’ But by Sep-tember 2008, the standing committee waspoised to recommend that EDFW ‘‘affiliatewith the Anglican Province of the South-ern Cone as a member diocese, on a tem-porary, pastoral basis, until such time asan orthodox Province of the Anglican Com-munion can be established in North Amer-ica.’’ The standing committee’s membersunanimously approved and endorsed thefollowing resolution from EDFW’s Con-vention Resolutions Committee:
BE IT RESOLVED, that the Episco-pal Diocese of Fort Worth, meeting inits 26th Annual Convention, does herebyaccept the provision made by the Angli-can Province of the Southern Cone, andthe Episcopal Diocese of Fort Worthdoes hereby immediately enter intomembership with the Anglican Provinceof the Southern Cone as a full and equalconstituent member of such Province,and the Episcopal Diocese of FortWorth does hereby accede to the author-ity of the Constitution and Canons of theAnglican Province of the Southern Coneto the extent such Constitution and Can-ons are not contrary to Holy Scripture
32. A month after EDFW’s November 2007convention, the annual convention of the Dio-cese of San Joaquin voted to leave TEC and toaffiliate with the Anglican Province of theSouthern Cone. Diocese of San Joaquin, 202Cal.Rptr.3d at 57. The bishop of that diocesethen filed with the California Secretary ofState an amendment to the articles of incor-poration of the corporate sole to change itsname from ‘‘The Protestant Episcopal Bishopof San Joaquin’’ to ‘‘The Anglican Bishop of
the Diocese of San Joaquin.’’ Id. In March2008, the San Joaquin bishop was deposed byTEC. Id. at 57–58. The Right Reverend JohnClark Buchanan, a member of TEC’s Houseof Bishops, averred that since 2006, the lead-ers of five of TEC’s 109 dioceses—includingEDFW, the Diocese of Pittsburgh, and theDiocese of San Joaquin—had purported toremove their dioceses from TEC over internaldisputes.
375Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
and the Apostolic teaching of the oneholy, catholic and apostolic Church.
In September 2008, Bishop Iker sent aletter to the rector of All Saints EpiscopalChurch, Christopher Jambor, stating thatproperties located at 4936, 4939, 5001, and5005 Dexter Avenue, Fort Worth, were not‘‘picked up’’ by the 1984 declaratory judg-ment nor held by the Corporation butrather were held in the name of All SaintsEpiscopal Church. In the letter, BishopIker asked that a deed be executed totransfer the parcels to the Corporation.
On November 15, 2008, in his address atthe 26th Annual Convention, Bishop Ikerobserved that EDFW had come ‘‘to thishistoric moment of decision making’’ dur-ing which EDFW would ‘‘vote to rescind’’its accession to TEC’s constitution andcanons and to align itself ‘‘instead with anorthodox Province of the Anglican Com-munion, the Province of the SouthernCone.’’ Bishop Iker stated,
Some have asked, ‘‘Will we still beEpiscopalians after our realignment voteis taken?’’ And the answer is, ‘‘Well, yesand no—that all depends!’’ After all, noone can ‘‘un-Episcopalian-ize you, and noone is being kicked out of the family. Wewill still be The Episcopal Diocese ofFort Worth. We are not changing ourname, because we are not changing ouridentity. We will still have an Episcopalform of polity, which means being in achurch that is under a Bishop. We willcontinue to stand for what our forebearsmeant when they called themselves Ep-iscopalians. But we will no longer be apart of the ecclesiastical structure some-times known as the Protestant EpiscopalChurch in the United States of America,which is governed by the General Con-vention. TEC is not the only EpiscopalChurch in the Anglican Communion, and
it does not own the name ‘‘Episcopali-an.’’
TTTT
TTT [T]he proposals before this Con-vention have one clear message: Wehere in the Episcopal Diocese of FortWorth intend to be who we have alwaysbeen, to believe what we have alwaysbelieved, and to do what we have alwaysdone. We are not going away, nor arewe abandoning anything. We are notleaving the Church—we are the Church.We will remain an orthodox diocese ofcatholic Christians, full members of theworldwide Anglican Communion.
The majority of EDFW’s Annual Conven-tion voted to leave TEC and to affiliatewith the Anglican Province of the South-ern Cone.33
Following the 26th Annual Conventionin November, EDFW published a state-ment on its website, declaring,
We remain a member diocese of theAnglican Communion.
We remain the Episcopal Diocese ofFort Worth. The word ‘‘episcopal’’ iden-tifies us as part of the apostolic succes-sion, with a bishop as our elected chiefpastor.
We remain in communion with otherEpiscopalians. We share fellowship withall those in any Province who recognizethe authority of Scripture and the faithand order of historic Anglicanism.
Shortly thereafter, TEC issued a letterof inhibition, to which Bishop Iker repliedthree days later, stating that ‘‘the inhibi-tion is of no force or effect, since theBishop and Diocese, meeting in annualconvention, constitutionally realigned withanother province of the Anglican Commun-ion on Saturday, Nov. 15, and are now
33. The proposed constitutional amendmentsunder consideration at the Annual Convention
were the same ones presented the previousyear that required a second reading.
376 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
constituent members of the Anglican Prov-ince of the Southern Cone.’’ Bishop Ikerfurther clarified his position, stating,
Katharine Jefferts Schori has no author-ity over me or my ministry as a Bishopin the Church of God. She never has,and she never will.
Since November 15, 2008, both the Epis-copal Diocese of Fort Worth and I asthe Diocesan Bishop have been membersof the Anglican Province of the SouthernCone. As a result, canonical declarationsof the Presiding Bishop of The Episco-pal Church pertaining to us are irrele-vant and of no consequence.
On December 5, 2008, TEC acceptedBishop Iker’s November 24, 2008 renuncia-tion and removed and released him fromthe obligations of all ministerial offices ofTEC. On December 16, 2008, at a specialmeeting of the standing committee, theCorporation’s board, and the chairman ofthe constitution and canons committee, thefirst item of discussion addressed parishesand individuals who wanted to stay withTEC. Of particular concern was the per-ception that the ‘‘Steering Committee ofNorth Texas Episcopalians’’ and the ‘‘ ‘Re-main Episcopal’ folks’’ were using the offi-cial Diocesan shield ‘‘in lots of their public-ity—in newspaper ads and on the web,etc.—identifying themselves boldly as ‘theEpiscopal Diocese of Fort Worth in theEpiscopal Church U.S.A,’ ’’ which themeeting’s attendees said was confusingand misleading. Those attending unani-mously agreed to send a ‘‘cease and desist’’letter regarding use of EDFW’s officialseal and shield in publicity. They thendiscussed the ‘‘very conflicted situationwhich now exists at All Saints’ Church,Fort Worth.’’
5. 2009
Presiding Bishop Schori issued a ‘‘No-tice of Special Meeting of the Conventionof the Episcopal Diocese of Fort Worth,Saturday, February 7, 2009.’’ In that no-tice, she stated that as there was no bishopnor any qualified members of the standingcommittee in the diocese, she had calledthe meeting ‘‘in consultation with theSteering Committee of faithful Episcopali-ans of that Diocese,’’ to elect a provisionalbishop and to elect or appoint members ofthe standing committee, executive council,and other officers, to adopt a budget, andto consider resolutions relating to ‘‘recentpurported amendments to the Constitutionand canons of the Diocese,’’ as well asother resolutions relating to the TEC-affil-iated diocese’s organization and gover-nance.
The emergency convention convened atTrinity Episcopal Church under PresidingBishop Schori. After quorums were veri-fied and the ‘‘parliamentary necessitieswere accomplished,’’ the first order ofbusiness was to elect a provisional bishop.Edwin F. Gulick Jr., who was elected tothe post, thereafter made appointments tovarious commissions and committees forthe vacancies resulting from the schism.Bishop Gulick also appointed trustees forthe Corporation, on the basis that the pre-vious trustees’ effective resignation oc-curred when they left TEC by the ‘‘irregu-lar, illegal action of the convention in2008.’’ 34
In his deposition, Bishop Gulick ac-knowledged that the Corporation’s boardmembers were supposed to be elected oneper year and, between sessions, replace-ments would be voted on by the board.And despite his inability to point to specif-ic language authorizing EDFW to removeall of the trustees, he nevertheless ex-plained that ‘‘in the unforeseen, unantic-
34. Additionally, Bishop Gulick testified in hisdeposition that ‘‘sufficient persons’’ were
elected in offices ‘‘necessary to conduct thebusiness of the Diocese.’’
377Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
ipated emergency moment,’’ everythingpossible had been done to comply withEDFW’s and TEC’s constitutions and can-ons.
On April 14, 2009, the TEC partiesadopted amended and restated articles ofincorporation for the Corporation andfiled them with the Texas Secretary ofState. These amended and restated arti-cles purported to return to the Corpora-tion’s original articles of incorporation(i.e., administration in accordance ‘‘withthe Constitution and Canons of the Epis-copal Diocese of Fort Worth and theEpiscopal Church of the United States’’),and listed Bishop Gulick, James Hazel,John Stanley, Robert Bass, Cherie Shipp,and Trace Worrell as the current mem-bers of the board of trustees.35
At the 27th Annual Meeting of the Dioc-esan Convention on November 14, 2009,the TEC-affiliated EDFW ratified the ac-tions of the February 7, 2009 special meet-ing, and after Bishop Gulick’s resignation,C. Wallis Ohl was elected and installed asthe TEC-affiliated EDFW’s bishop. Thesame individuals who were put into placeat the February 7, 2009 special meetingwere elected to the TEC-affiliated dio-cese’s standing committee and the Corpo-ration’s board of trustees. The conventionalso ratified the resolutions made and ac-tions taken at the February 7, 2009 specialmeeting and brought EDFW’s constitutionand canons back into compliance withTEC’s constitution and canons. Bishop Ohl
testified that the faction headed by BishopIker was not the ‘‘Episcopal Diocese ofFort Worth,’’ that he—not Bishop Iker—was the legitimate and properly electedEDFW Bishop, and that he, Hazel, Shipp,Worrell, Bass, and Stanley—and not Bish-op Iker, Salazar, Patton, Virden, Barber,and Bates—were the Corporation’s legiti-mate and properly elected trustees. SeeEpiscopal Diocese, 422 S.W.3d at 647–49.
C. The Lawsuit
On the same day that the TEC parties’amended and restated Articles of Incorpo-ration were filed—April 14, 2009—theTEC parties filed suit for conversion andviolations of business and commerce codesection 16.29.36 Additionally, the TEC par-ties sought declaratory and injunctive re-lief regarding who could act as EDFW’srepresentatives and who had use and con-trol of EDFW’s real and personal proper-ty.37 See In re Salazar, 315 S.W.3d 279,282 (Tex. App.—Fort Worth 2010, orig.proceeding).
1. Summary Judgment—First Round
The parties filed competing motions forsummary judgment. As explained by thesupreme court,
In its motion for summary judgmentTEC argued, in part, that the actions ofthe Board of Trustees in amending theFort Worth Corporation’s articles of in-corporation were void because the ac-tions went beyond the authority of thecorporation, which was created and ex-
35. A week later, Bishop Iker sent a certificateof correction to the secretary of state regard-ing the Corporation’s articles.
36. Business and commerce code section16.29 is now section 16.103, ‘‘Injury to Busi-ness Reputation; Dilution.’’ See Tex. Bus. &Com. Code Ann. § 16.103 (West Supp. 2017).
37. In 2009, the Corporation transferred titlesto Trinity Episcopal Church (Fort Worth) andSt. Martin-in-the-Fields Episcopal Church
(Southlake) to the rector, wardens, and vestryof these parishes that stayed with TEC. It alsotransferred title to St. Luke’s EpiscopalChurch (Stephenville) to the rector, wardens,and vestry of that parish after evidence ofsatisfactory removal of the Corporation’sname from any encumbrances on the proper-ty. Bishop Iker thereafter issued orders dis-solving the relationship between the dioceseand these churches.
378 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
isted as an entity subordinate to a Dio-cese of TEC. TEC argued that ‘‘[t]hesecular act of incorporation does not al-ter the relationship between a hierarchi-cal church and one of its subordinateunits’’ and that finding otherwise ‘‘wouldrisk First Amendment implications.’’The Diocese, on the other hand, arguedthat the case was governed by the TexasNon-Profit Corporation Act and theTexas Uniform Unincorporated Non-profit Association Act; under those stat-utes a corporation may amend its arti-cles of incorporation and bylaws; andTEC had no power to limit or disregardamendments to the Corporation’s arti-cles and bylaws.
Episcopal Diocese, 422 S.W.3d at 650(footnotes omitted).
After the trial court granted summaryjudgment and issued a declaratory judg-ment for the TEC parties in 2011, statingthat the changes made by Appellees to theCorporation’s articles and bylaws were ul-tra vires and void,38 Appellees appealeddirectly to the supreme court. The heart ofthe dispute, as identified by the supremecourt, was ‘‘whether the ‘deference’ (alsosometimes referred to as the ‘identity’) or‘neutral principles of law’ methodologyshould be applied to resolve the propertyissue.’’ Id. at 649.
The court’s opinion in the direct appealissued in 2013. In it, the court reversed thetrial court’s judgment and remanded thecase to the trial court to be consideredunder the neutral principles methodology.Id. at 647. In its opinion, the court statedthat under this methodology, ownership ofdisputed property is to be determined by
considering evidence such as the deeds tothe properties, the terms of the localchurch charter (including articles of incor-poration and bylaws, if any), the relevantprovisions of governing documents of thegeneral church and local church entities,the governing state statutes, and otheritems as applicable. Id. at 651–52 (‘‘[O]nremand the trial court is not limited toconsidering only the four factors listed inJones [v. Wolf, 443 U.S. 595, 99 S.Ct. 3020,61 L.Ed.2d 775 (1979) ]TTTT [t]he elementslisted in Jones are illustrative.’’). It alsoreferenced Masterson, which issued on thesame day, as applicable to this case re-garding church canons and Texas law. Id.at 653.
In Episcopal Diocese as well as in Mas-terson, the court established guidance forthe case on remand. In Episcopal Diocese,the court observed, ‘‘[A]bsent agreementor conclusive proof of title to the individualproperties and the capacities in which ti-tles were taken, fact questions exist underneutral principles of law, at a minimum,about who holds title to each property andin what capacity.’’ Id. at 652. The courtalso instructed,
While we agree that determination ofwho is or can be a member in goodstanding of TEC or a diocese is an ec-clesiastical decision, the decisions byBishops Gulick and Ohl and the 2009convention do not necessarily determinewhether the earlier actions of the corpo-rate trustees were invalid under Texaslaw. The corporation was incorporatedpursuant to Texas corporation law andthat law dictates how the corporationcan be operated, including determiningthe terms of office of corporate di-
38. The original cause number in the trialcourt was 141-237105-09. The trial courtgranted Appellees’ motion to sever to makethe trial court’s interlocutory judgment forthe TEC parties final and appealable. The trialcourt severed the claims subject to the sum-
mary judgment into cause number 141-252083-11 and stayed the remainder of theunfinished action. Among others, the petition-ers in the direct appeal included Bishop Iker,Salazar, Patton, Virden, Barber, Bates, sever-al clergy, and 47 churches.
379Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
rectors, the circumstances under whicharticles and bylaws can be amended, andthe effect of the amendments.
Id. The court concluded that the recordfailed to conclusively show as a matter oflaw that the Corporation’s trustees hadbeen disqualified from serving as such atthe relevant times, whether the 2009 ap-pointments to the Corporation’s board byBishop Ohl were valid or invalid underTexas law, or whether, under Texas law,the actions taken by the trustees appoint-ed by Bishop Ohl in 2009 were valid orinvalid. Id. at 652–53.
2. Summary Judgment—SecondRound
Upon remand to the trial court, the TECparties filed an amended petition in whichthey renewed their severed claims.39 Bythis time the severed claims included notonly conversion and business and com-merce code section 16.29 violations but alsobreach of fiduciary duty, breach of trust,trespass to try title, and an action to quiettitle. Additionally, the TEC parties hadpleaded for the imposition of a constructivetrust under a number of theories, includingestoppel. They also continued to seek de-
claratory and injunctive relief and an ac-counting.40
The parties once more filed competingmotions for partial summary judgment.41
a. Appellees’ Motion and theTEC Parties’ Response
In their motion, Appellees argued:
1 that the deeds, the 1984 judgment, theDiocese’s charters, and adverse posses-sion vested the Corporation with titleand control, that TEC’s charters madeno claim to title and only asserted aninvalid trust, and that the TEC parties’pleadings conceded that title was in theCorporation;
1 that state corporations and associationslaw requires adherence to the Corpora-tion’s and Association’s bylaws, makingAppellees the Corporation’s electedtrustees and Bishop Iker the chairmanof the Corporation’s board and depriv-ing the TEC parties of standing whenTEC’s own charters prevented theTEC parties from convening the spe-cial convention upon which their claimswere based;
39. Prior to the TEC parties’ filing the amend-ed petition, the trial court had denied theirmotion to consolidate their previously severedclaims.
40. Appellees moved to strike the renewedclaims, but the trial court denied the motion.
41. We note here that in considering the com-peting summary judgment motions, the trialcourt was faced with the same herculean taskthat has been presented to us on appeal. First,it was required to read a record totaling over10,000 pages on remand, a task that wouldtake an above-average reader, such as a trialjudge, an estimated 200 hours, or betweenfive and six weeks, assuming he or she devot-ed 40 hours per week solely to the endeavor.(Including the portions of the record devel-oped prior to the direct appeal, the record
currently totals over 14,000 pages.) Then thetrial court was presented with the dauntingtask of conducting the research and analysisnecessary to apply to that voluminous recordsuch exceedingly complex legal issues as statecorporations, associations, and trust law,heavily overlaid by the U.S. Supreme Court’sFirst Amendment jurisprudence, an endeavorthat could easily have taken as much time—ifnot a good deal more—than the reading of therecord. All the while, the trial court was ex-pected to carry out its other obligations ofattending to the hundreds of cases pending onits docket that were, likewise, deserving of thetrial court’s attention. On appeal, as acknowl-edged by Appellees in their February 12, 2018‘‘Supplemental Response to Latest LetterBrief,’’ we have received an additional ‘‘346pages of briefing from the parties in this ap-peal’’ to consider and address.
380 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
1 that state law prohibits an express,implied, or constructive trust interestfor the TEC parties;
1 that the same rules that allocated con-trol to Appellees of the real propertyalso applied to the funds, trusts, andendowments that the TEC partiessought; and
1 that estoppel and quasi-estoppel didnot apply because Appellees only want-ed a declaration to be left alone.
The TEC parties responded that Appel-lees had judicially admitted that the Cor-poration held all property in trust forEDFW and its congregations, and sincethose entities were subordinate affiliates ofthe hierarchical church, the Corporationtherefore held the property in trust for theTEC parties because they were the onlyparties recognized by TEC as those enti-ties. They also argued, as they do on ap-peal, that the Dennis Canon, in addition toAppellees’ words and actions prior to theschism, imposed a trust—express, contrac-tual, or constructive—in their favor. Andthey argued that Appellees’ adverse pos-session claim failed because there was no‘‘adverse’’ interest until the 2008 schism.
b. The TEC Parties’ Motionand Appellees’ Response
In their summary judgment motion, theTEC parties contended:
1 that because TEC had determined thatAppellees did not represent EDFWand its congregations and that theTEC parties did represent them, theproperty held in trust by the Corpora-tion was held in trust for the TECparties;
1 that Appellees had no right to controlthe Corporation because, in addition to
the plain terms of the Corporation’sbylaws, it was a subordinate entity ofEDFW that only the TEC partiescould control;
1 that state associations law favored theTEC parties because local chapters aretreated as constituents of larger organ-izations;
1 that an express trust was created whenEDFW agreed to TEC’s rules in ex-change for formation, membership, andproperty, including the Dennis Canon,but that even without an express trust,the TEC parties were entitled to aconstructive trust;
1 that Appellees’ adverse possessionclaim failed because they did not meetall of the necessary elements to estab-lish that claim;
1 that Appellees were estopped fromraising claims and defenses that con-tradicted their commitments, conduct,and prior statements to courts and oth-er federal and state authorities;
1 that, contrary to Appellees’ assertion,the TEC parties did have standing; and
1 that based on all of the above, the trialcourt should grant summary judgmenton the TEC parties’ trespass-to-try-title claim and their request for attor-ney’s fees and for declaratory judg-ment.42
Appellees responded that the supremecourt had rejected the TEC parties’ defer-ence theory in favor of neutral principles,that there was no express or irrevocabletrust in TEC’s favor nor a contractual orconstructive trust, that there was nobreach of fiduciary duty, and that the TECparties’ remaining grounds were baseless.
42. The TEC parties also raised retroactivityand deference, re-urging their original, pre-
Episcopal Diocese and Masterson arguments.
381Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
c. Supplemental Motions
On March 2, 2015, the trial court, exceptas to claims involving All Saints EpiscopalChurch, granted Appellees’ motion and de-nied the TEC parties’ motion. The partiesfiled supplemental summary judgment mo-tions to address the All Saints issues 43 andagreed that the remaining claims in causenumber 141-252083-11—the claims for at-torney’s fees, conversion, violations of busi-ness and commerce code section 16.29,damages for breach of fiduciary duty (asopposed to the predicate for a constructivetrust), the action to quiet title, and for anaccounting—should be severed and stayed.
In their summary judgment motion re-lating to All Saints Episcopal Church,44
Appellees argued that the Corporationheld legal title to two of the All Saintsproperties—the sanctuary and parish hallon 5001 Crestline and the rectory on 5003Dexter—by virtue of the 1984 judgment’sproperty transfer and that beneficial titlewas held by the group affiliated with them.Ergo, applying the same reasoning as thetrial court’s previous summary judgment,
Appellees were entitled to summary judg-ment as to those two properties. Appelleeswaived their claims to the remaining fourAll Saints properties ‘‘so as to resolve thiscase without a trial.’’ 45
The TEC parties, in their All Saintssummary judgment motion, asked the trialcourt to construe the deeds, to declare theTEC parties the properties’ equitable own-ers, and to remove Appellees as the trus-tees or owners of legal title.46 The trialcourt disposed of the All Saints summaryjudgment motions in its final summaryjudgment.
3. Trial Court’s Judgment
On July 24, 2015, the trial court signed afinal judgment in this case, consolidatingits prior orders.
In the judgment, the trial court grantedAppellees’ motion as to All Saints on thetwo pieces of property under dispute anddenied the TEC parties’ opposing motion.The trial court recited in its judgment thatthe claims for attorney’s fees in both theoriginal and severed action, the claims in
43. The record reflects that All Saints had atroubled history with EDFW’s leadership.Four years after the 1986 agreement betweenAll Saints and EDFW to designate All Saintsas EDFW’s Cathedral Church, in October1990, a dispute arose between then-BishopPope and All Saints with regard to cathedralstatus and how the property was held—thebishop wanted title to the property to be heldin conformity with EDFW’s constitution andcanons, while All Saints’s vestry wanted tohold it in trust for TEC in conformity withTEC’s constitution and canons.
44. The articles of incorporation for All SaintsEpiscopal Church are contained in the recordand indicate that it was incorporated for afifty-year term in 1953. No one has indicatedwhether any efforts were taken to maintain itsincorporated status after 2003 or what effectthe lack of status might have, but in theirreply to the TEC parties’ All Saints motion forsummary judgment, Appellees asserted thatAll Saints’s incorporation ‘‘in the 1950s has
no bearing on this dispute’’ and that all par-ties agreed that under EDFW’s canons, the AllSaints Corporation is merely an ‘‘adjunct orinstrumentality’’ of the parish that cannothold real property.
45. 5001 Crestline and 5003 Dexter are adja-cent to the properties referenced by BishopIker in his September 2008 letter to the AllSaints rector.
46. The TEC parties also revisited all of theirprior arguments in the case, prompting Ap-pellees to remark in their summary judgmentresponse that ‘‘the Court should reject these95 pages that summarize what the Court re-jected when it was 153 pages’’ and that ‘‘[t]helast 95 pages of the 111 pages of Plaintiffs’motion can be ignored because Plaintiffs ad-mit their ‘global arguments’ merely re-assertthe same grounds this Court rejected in itsPartial Summary Judgment of March 2,2015.’’
382 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
the severed action for conversion, damagesfor breach of fiduciary duty, to quiet titleand for an accounting, and the claims un-der business and commerce code section16.29 remained pending in the original ac-tion, cause number 141-237105-09, and or-dered that those remaining claims, ‘‘to theextent they are also pending in this cause,’’were dismissed without prejudice and pre-served for litigation in cause number 141-237105-09.
The trial court made the following decla-rations in its judgment:
1. Neutral principles of Texas lawgovern this case, and applying such lawis not unconstitutionally retroactive.[47]
2. The Corporation of the EpiscopalDiocese of Fort Worth and DefendantCongregations hold legal title to all theproperties listed on Exhibit 1 attachedto this Order, subject to control by the
Corporation pursuant to the Diocese’scharters.[48]
3. The Episcopal Diocese of FortWorth and the Defendant Congregationsin union with that Diocese hold benefi-cial title to all the properties listed onExhibit 1 attached to this Order.
4. Defendants Dr. Franklin Salazar,Jo Ann Patton, Walter Virden, III, RodBarber, and Chad Bates are, and havebeen since 2005, the properly electedTrustees of the Corporation for theEpiscopal Diocese of Fort Worth.
5. Defendant Jack Iker is, and hasbeen since 2005, the proper Chairman ofthe board and one of the Trustees of theCorporation for the Episcopal Diocese ofFort Worth.
6. Defendants are the proper repre-sentatives of the Episcopal Diocese of
47. In this, the trial court was merely obeyingthe law of the case: the supreme court statedin Episcopal Diocese that it had ‘‘concluded inMasterson that the neutral principles method-ology was the substantive basis [for the su-preme court’s] decision in Brown v. Clark, 102Tex. 323, 116 S.W. 360 (1909),’’ and that ‘‘asto the argument that application of neutralprinciples may pose constitutional questions ifthey are retroactively applied, we note thatover a century ago in Brown TTT our analysisand holding substantively reflected the neu-tral principles methodology.’’ 422 S.W.3d at650–51, 653. Based on the supreme court’sdetermination that the neutral principlesmethodology had substantively applied to thistype of case since 1909, the trial court did noterr by determining that its application herewould not be retroactive. See Farmers Grp.Ins., Inc. v. Poteet, 434 S.W.3d 316, 329 (Tex.App.—Fort Worth 2014, pet. denied) (explain-ing that the law of the case doctrine is theprinciple under which questions of law decid-ed on appeal to a court of last resort willgovern the case throughout its subsequentstages). Therefore, to the extent that the TECparties have raised subissues in footnote 5 oftheir appellants’ brief with regard to theirissues 1(a) and 1(b), in which they re-urgetheir pre-Episcopal Diocese and Mastersonretroactivity and deference methodology ar-
guments, we overrule these subissues withoutfurther discussion. But see Eric G. Osborne &Michael D. Bush, Rethinking Deference: Howthe History of Church Property Disputes Callsinto Question Long-Standing First AmendmentDoctrine, 69 SMU L. Rev. 811, 813 (2016)(suggesting that the deference model itself isfundamentally flawed and that its result ‘‘hasbeen to empower denominational hierarchies,thus making divisions and intra-church fightsfor control especially bitter’’).
48. The supreme court acknowledged in Epis-copal Diocese that ‘‘[t]he 1984 judgment[transferring real and personal property fromthe Diocese of Dallas] vested legal title of thetransferred property in the Fort Worth Corpo-ration, except for certain assets for which thepresiding Bishop of the Dallas Diocese andhis successors in office had been designatedas trustee.’’ 422 S.W.3d at 648. Those otherassets were transferred by the 1984 judgmentto the Bishop of the Fort Worth Diocese andhis successors in office as trustee. Id.; seeFarmers Grp., 434 S.W.3d at 329 (law of thecase doctrine). Ultimately, legal title to thatproperty was also placed under the Corpora-tion’s control. See Tex. Bus. Orgs. Code Ann.§ 252.015 (West 2012). No one disputes thatthe Corporation holds legal title.
383Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
Fort Worth, the Texas unincorporatedassociation formed in 1982.
7. The Defendants hold legal titleand control of the funds and endow-ments listed on Exhibit 2 attached tothis Order, subject to the terms of each.
8. Plaintiffs have no express, im-plied, or constructive trust in the prop-erties or funds listed in the Exhibitsattached to this Order.
9. Defendants have not breached anyfiduciary duty to or special relationshipwith any Plaintiffs.
Exhibit 1 attached to the order listed 121properties. Exhibit 2 listed four funds forwhich the Corporation is listed as trustee,six funds for which Bishop Iker is listed astrustee, and one fund for which the EDFWTreasurer, the EDFW Chancellor, andBishop Iker are listed as trustees.
The TEC parties filed a joint notice ofappeal.
III. Discussion
TEC argues that the trial court erred asa matter of law in its application of the‘‘neutral principles’’ approach by failing todefer to and apply TEC’s ecclesiasticaldetermination of which entity constitutesEDFW. The TEC parties argue that thetrial court erred by denying their motionfor summary judgment and granting sum-mary judgment for Appellees by:
a. Violating Masterson, Episcopal Dio-cese, and the First Amendment by over-riding the Episcopal Church on who maycontrol an Episcopal Diocese and Epis-copal Congregations;
b. Violating Masterson, Episcopal Dio-cese, and the First Amendment’s limitson neutral principles by refusing to ‘‘ac-cept as binding’’ the Church’s determi-nation of ecclesiastical issues within thisproperty case;
c. Failing to apply neutral principles ofTexas Associations law, including an as-sociation’s right to interpret and enforceits own rules;d. Failing to apply this Court’s holdingin Shellberg v. Shellberg, 459 S.W.2d465, 470 (Tex. Civ. App.—Fort Worth1970, writ ref’d n.r.e.), the law in effectwhen the Diocese made its contract;e. Violating Texas trust law by refus-ing to enforce the express, unrevokedtrusts in favor of the Church in fifty-fiveindividual recorded deeds;f. Failing to find breach of fiduciaryduty and to impose a constructive trustwhere Appellees broke a century’sworth of oaths and commitments;g. Failing to estop Appellees from con-tradicting their own statements to othercourts and parties;h. Failing to apply Texas Corporationslaw to the undisputed facts, including aplain application of the Corporation’s by-laws;i. Failing to reject Appellees’ claim totitle by adverse possession;j. Holding, if it did, that Appellants didnot have standing; andk. Denying Appellants’ trespass-to-try-title claim.
Because TEC also adopted and incorporat-ed by reference all of the TEC parties’issues and arguments, we will addresstheir dispositive issues together.
A. Standard of Review
[1, 2] In a summary judgment case,the issue on appeal is whether the movantmet the summary judgment burden byestablishing that no genuine issue of mate-rial fact exists and that the movant isentitled to judgment as a matter of law.Tex. R. Civ. P. 166a(c); Mann FrankfortStein & Lipp Advisors, Inc. v. Fielding,289 S.W.3d 844, 848 (Tex. 2009). We re-view a summary judgment de novo. Trav-
384 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
elers Ins. Co. v. Joachim, 315 S.W.3d 860,862 (Tex. 2010). When both parties movefor summary judgment and the trial courtgrants one motion and denies the other,the reviewing court should review bothparties’ summary judgment evidence anddetermine all questions presented. MannFrankfort, 289 S.W.3d at 848. The review-ing court should render the judgment thatthe trial court should have rendered. SeeMyrad Props., Inc. v. LaSalle Bank Nat’lAss’n, 300 S.W.3d 746, 753 (Tex. 2009);Mann Frankfort, 289 S.W.3d at 848.
B. Jurisdiction
[3–6] Standing is a threshold issue thatimplicates subject matter jurisdiction, fo-cuses on the question of who may bring anaction, and presents the issue of whether acourt may consider a dispute’s merits. SeeIn re J.W.L., 291 S.W.3d 79, 85 (Tex.App.—Fort Worth 2009, orig. proceeding[mand. denied] ). ‘‘To have standing, aplaintiff must be personally aggrieved, andhis alleged injury must be concrete andparticularized, actual or imminent, and nothypothetical.’’ Heat Shrink Innovations,LLC v. Med. Extrusion Techs.–Tex., Inc.,No. 02-12-00512-CV, 2014 WL 5307191, at*7 (Tex. App.—Fort Worth Oct. 16, 2014,pet. denied) (mem. op.) (citing Daimler-Chrysler Corp. v. Inman, 252 S.W.3d 299,304–05 (Tex. 2008)). ‘‘A party may be per-sonally aggrieved if it has a legal or equi-table interest in the controversy.’’ Id. (cit-ing Goswami v. Metro. Sav. & Loan Ass’n,751 S.W.2d 487, 489 (Tex. 1988) (holdingthat plaintiff had standing to contest saleof property in which he had an equitableinterest), $574.37 U.S. Coin & Currency v.State, No. 02-06-00434-CV, 2008 WL
623793, at *6 (Tex. App.—Fort WorthMar. 6, 2008, no pet.) (mem. op.) (holdingthat although vehicle was owned by anoth-er person, plaintiff had equitable interestin truck to confer standing to contest for-feiture), and First Nat’l Bank of El Cam-po, TX v. Buss, 143 S.W.3d 915, 922 (Tex.App.—Corpus Christi 2004, pet. denied)(noting that a person in possession of avehicle who is the intended owner of thevehicle has an equitable possessory rightin the vehicle even if that person is notnamed on the vehicle’s title)). Without abreach of a legal right belonging to aspecific party, that party has no standingto litigate. Cadle Co. v. Lobingier, 50S.W.3d 662, 669–70 (Tex. App.—FortWorth 2001, pets. denied) (en banc op. onreh’g). We review standing de novo andmay review the entire record to determinewhether any evidence supports it. SengerCreek Dev., LLC v. Fuqua, No. 01-15-01098-CV, 2017 WL 2376529, at *13 (Tex.App.—Houston [1st Dist.] June 1, 2017, nopet.) (mem. op.) (citing Mayhew v. Town ofSunnyvale, 964 S.W.2d 922, 928 (Tex.1998); Tex. Ass’n of Bus. v. Tex. Air Con-trol Bd., 852 S.W.2d 440, 444–45 (Tex.1993)).
The TEC parties argue that a party hasstanding as long as he or she alleges apecuniary interest. They contend that theyhave done so as ‘‘(1) the displaced minoritythat formerly enjoyed use of the propertyand as the only parties authorized by theChurch to lead the Diocese; and (2) theChurch that formed the Diocese and re-ceived a trust interest in the property,’’citing Getty Oil Company v. InsuranceCompany of North America, 845 S.W.2d794, 798–99 (Tex. 1992),49 cert. denied, 510
49. In Getty, a chemical buyer sued the sellerand the seller’s insurers after the chemicalsexploded and killed someone and a wrongfuldeath judgment was obtained against it; thebuyer claimed in its subsequent suit that the
seller and the seller’s insurers were contractu-ally obligated to provide insurance to coverthe judgment against it. 845 S.W.2d at 796–98. The court held that res judicata barred theclaims against the seller because the buyer
385Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
U.S. 820, 114 S.Ct. 76, 126 L.Ed.2d 45(1993), and Hunt v. Bass, 664 S.W.2d 323,324 (Tex. 1984).50
According to Appellees, in contrast,
No matter how [the TEC parties]claim to have suffered injury, a statestatute says they have no standing tosue the Corporation or its Trustees forviolating fiduciary duties or corporatecharters. Any claim for breach of fidu-ciary duty owed to the Diocese or theCorporation must be brought by thoseentities. Since [the TEC parties’] counselrepresent neither, they have no authori-ty to bring such claims for them.
Additionally, lawsuits claiming thatthe acts or property transfers of a Texas
nonprofit corporation violate its corpo-rate purposes can be brought only by amember or the Attorney General. [TheTEC parties] are neither; the Corpora-tion has no ‘‘members,’’ and the Attor-ney General is not a party.
Since [the TEC parties] severed allconnection with the Diocese and theCorporation and have no right to repre-sent either, they have no standing tocomplain about how either is governed.
[Footnotes omitted.] Appellees refer us toarticles 1396-2.03(B) 51 and 1396-2.08(A) 52
of the revised civil statutes 53 and Cotten v.Weatherford Bancshares, Inc., 187 S.W.3d687, 698 (Tex. App.—Fort Worth 2006, pet.denied),54 disapproved of on other groundsby Ritchie v. Rupe, 443 S.W.3d 856, 865
could have asserted those claims in the earliersuit despite their contingency. Id. at 799.From this, Appellants draw their argumentthat once their identity has been established,their claims will no longer be contingent.
50. In Hunt, several plaintiffs filed a petitionfor writ of mandamus after their separatelawsuits were delayed because the commis-sioners’ court and commissioners failed toprovide adequate courtroom space and per-sonnel. 664 S.W.2d at 324. The trial courtdetermined that the plaintiffs had no standingto sue for mandamus relief and dismissedtheir petition. Id. The supreme court held thatbecause each plaintiff was a party to a lawsuitpending in the district court (as distinguishedfrom the general public, which did not havelawsuits pending), and because they had eachalleged a failure of the court system to pro-vide trials in those lawsuits in a reasonabletime, which potentially deprived each plaintiffof a valuable property right, the plaintiffs hadmade sufficient allegations concerning the in-fringement of their private rights to presentjusticiable interests, providing them withstanding for the mandamus action. Id.
51. Act of Apr. 23, 1959, 56th Leg., R.S., ch.162, art. 2.03(B), 1959 Tex. Gen. Laws 286,290 (listing who may bring a proceedingagainst the corporation with regard to anultra vires act—a member, the corporationitself through a receiver, trustee, or other
legal representative, or the Attorney General)(current version at Tex. Bus. Orgs. Code Ann.§ 20.002(c)(1)–(3) (West 2012)).
52. Act of Apr. 23, 1959, 56th Leg., R.S., ch.162, art. 2.08(A), 1959 Tex. Gen. Laws 286,292 (‘‘A corporation may have one or moreclasses of members or may have no mem-bers.’’) (current version at Tex. Bus. Orgs.Code Ann. § 22.151(a) (West 2012)).
53. In their pleadings in the trial court, theparties appear to have at least implicitlyagreed that the applicable provisions of theformer statutes and current statutes in thebusiness organizations code are largely thesame, and neither party has indicated to usthat there are any substantive differences be-tween the Corporation’s law of formation andthe current law. Accordingly, in the interest ofjudicial economy, we will cite to the currentsections of the business organizations code.
54. We stated in Cotten,
While corporate officers owe fiduciaryduties to the corporation they serve, they donot generally owe fiduciary duties to indi-vidual shareholders unless a contract orconfidential relationship exists betweenthem in addition to the corporate relation-ship. Due to its extraordinary nature, thelaw does not recognize a fiduciary relation-ship lightly. Therefore, whether such a dutyexists depends on the circumstances.
386 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
n.9, 871 n.17, 877 (Tex. 2014), in support oftheir argument.
With regard to this particular case,standing turns at least in part on theneutral principles analysis with which wehave been tasked by the supreme court.55
From the application of these neutral prin-ciples, we will determine whether the TECparties have an interest in the property orentities that would give them standing forthe claims that were resolved by the trialcourt’s final judgment.56
Additionally, we note that the ecclesias-tical abstention doctrine, which arises fromthe Free Exercise Clause of the FirstAmendment to the United States Constitu-tion, may also affect our jurisdiction toconsider some of the claims. See U.S.Const. amend. I (‘‘Congress shall make nolaw respecting an establishment of reli-gion, or prohibiting the free exercisethereof.’’); Masterson, 422 S.W.3d at 601(observing that the Free Exercise clauseseverely circumscribes the role that civilcourts may play in resolving church prop-erty disputes by prohibiting civil courtsfrom inquiring into matters concerning
theological controversy, church discipline,ecclesiastical government, or conformity ofchurch members to the church’s moralstandards).
1. Neutral Principles Framework
The structural underpinning of our re-view of the trial court’s judgment beginswith a review of cases from the U.S. Su-preme Court on the evolution of the appli-cable law, followed by a closer look atMasterson and other cases to which theparties have referred us.
a. Precedent and Persuasive Authority
(1) United States SupremeCourt Cases
(a) Watson v. Jones, 80 U.S. (13 Wall.)679, 20 L.Ed. 666 (1871).
Watson, which set out the original ‘‘def-erence’’ methodology applicable to hierar-chical churches, arose from a schism thatpresented the question ‘‘as to which of twobodies shall be recognized as the Third orWalnut Street Presbyterian Church,’’ aswell as who had the authority to lead it
187 S.W.3d at 698 (citations omitted).
55. The standing debate arose several timesduring the course of the proceedings,summed up by Appellees at one hearing as,
The only argument that they [the TEC par-ties] have the right to argue is whetherthey’re—the individuals are duly elect-edTTTT Because it’s the nature of the claimsthat the individuals are bringing that onlythe diocese and the diocesan corporationcould bring. An individual who sues in arepresentative capacity is suing on behalf ofthe individual entity that the person repre-sents.
56. We touched on this issue in In re Salazar,when Appellees filed a petition for writ ofmandamus after the trial court denied part oftheir motion to show authority under rule ofcivil procedure 12 as to attorneys hired by theTEC parties to represent the Corporation andEDFW in the property dispute. 315 S.W.3d at281. The essence of that original proceeding
was one of identity. See id. at 282, 284 (ob-serving that both plaintiffs and defendantspurported to represent EDFW and the Corpo-ration and that plaintiffs argued that the issueof the identity of the true bishop and trusteeswas at the heart of the suit). We did not reachthe question of the ‘‘true identity’’ of the bish-op and trustees because we agreed with thetrial court that a rule 12 motion was not theappropriate vehicle to reach the merits of anintra-church dispute. Id. at 285.
Instead, because neither side challenged thetrial court’s finding that the two attorneys didnot discharge their burden of proof, we con-cluded that the trial court abused its discre-tion by not striking the pleadings filed bythose attorneys on behalf of the Corporationand EDFW. Id. at 286. We granted manda-mus relief because a corporation cannot sueitself, and we reasoned that presentationsfrom two opposing factions each claiming tobe the Corporation and EDFW could unneces-sarily confuse a trier of fact. Id. at 287.
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and to possess the church’s property. 80U.S. at 717–18. The local church’s trusteeshad incorporated to hold title to the prop-erty in trust ‘‘for the use of the personswho by the constitution, usages, and lawsof the Presbyterian body, are entitled tothat use,’’ and were elected by the localchurch’s congregation for two-year terms.Id. at 720.
The Court noted that for congregation-al—that is, independent, stand-alone—churches undergoing a schism into ‘‘dis-tinct and conflicting bodies, the rights ofsuch bodies to the use of the propertymust be determined by the ordinary prin-ciples which govern voluntary associa-tions.’’ Id. at 724–25. In such circum-stances, if no trust was previously imposedupon the property when purchased or giv-en, the court would not imply one, themajority would keep the property, and‘‘[t]he minority in choosing to separatethemselves into a distinct body, and refus-ing to recognize the authority of the gov-erning body, can claim no rights in theproperty from the fact that they had oncebeen members of the church or congrega-tion.’’ Id. at 725.
But the Court treated a local church’smembership in a hierarchical church—partof a large and general organization ofsome religious denomination that is ‘‘moreor less intimately connected by religiousviews and ecclesiastical government’’—dif-ferently. Id. at 726. The Court acknowl-edged that the property’s legal documentsdid not indicate its disposition.57 Id. Rath-er, the property was purchased for the use
of a religious congregation, ‘‘and so long asany existing religious congregation can beascertained to be that congregation, or itsregular and legitimate successor, it is enti-tled to the use of the property.’’ Id. (em-phasis added). Instead of looking to therules that govern voluntary associations todetermine identity or succession, the Courtstated that in cases involving a hierarchicalchurch,58 ‘‘we are bound to look at the factthat the local congregation is itself but amember of a much larger and more impor-tant religious organization, and is under itsgovernment and control, and is bound byits orders and judgments’’ with regard to‘‘questions of discipline, or of faith, or ec-clesiastical rule, custom, or law’’ that havebeen decided by the highest of the hierar-chical church’s judicatories, and to acceptthose decisions as final and binding ‘‘in allcases of ecclesiastical cognizance.’’ Id. at726–27, 729.
In resolving the matter in favor of thelocal faction that had remained with thenational, hierarchical church, the Courtstated,
Whatever may have been the case be-fore the Kentucky court, the appellantsin the case presented to us have separat-ed themselves wholly from the churchorganization to which they belongedwhen this controversy commenced. Theynow deny its authority, denounce its ac-tion, and refuse to abide by its judg-ments. They have first erected them-selves into a new organization, and havesince joined themselves to another total-
57. The Court stated, ‘‘Here is no case of prop-erty devoted forever by the instrument whichconveyed it, or by any specific declaration ofits owner, to the support of any special reli-gious dogmas, or any peculiar form of wor-shipTTTT’’ Watson, 80 U.S. at 726.
58. The Court specifically identified the ‘‘Prot-estant Episcopal’’ church as one of the ‘‘largeand influential bodies [with] TTT a body of
constitutional and ecclesiastical law of itsown, to be found in [its] written organic laws,[its] books of discipline, in [its] collections ofprecedents, in [its] usage and customs, whichas to each constitute a system of ecclesiasticallaw and religious faith that tasks the ablestminds to become familiar with.’’ Watson, 80U.S. at 729.
388 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
ly different, if not hostile, to the one towhich they belonged when the difficultyfirst began.
Id. at 734. Accordingly, the Court conclud-ed, ‘‘the appellants, in their present posi-tion, have no right to the property, or tothe use of it, which is the subject of thissuit.’’ Id.
Watson governed church property dis-putes until neutral principles made an ap-pearance, see Windwood PresbyterianChurch, Inc. v. Presbyterian Church(U.S.A.), 438 S.W.3d 597, 602 (Tex. App.—Houston [1st Dist.] 2014, no pet.) (op. onreh’g) (referencing Justice Brennan’s con-curring opinion in Maryland & Va. Elder-ship of Churches of God v. Church of Godat Sharpsburg, Inc., 396 U.S. 367, 370, 90S.Ct. 499, 501, 24 L.Ed.2d 582 (1970)(Brennan, J., concurring)),59 and elementsof it remain in play. See Masterson, 422S.W.3d at 602 (stating that deference isnot optional when ecclesiastical questionsare at issue).
(b) Kedroff v. St. Nicholas Cathedral ofRussian Orthodox Church in NorthAmerica, 344 U.S. 94, 73 S.Ct. 143, 97L.Ed. 120 (1952).
Kedroff involved a dispute over the rightto use and occupy a church building. 344U.S. at 95, 73 S.Ct. at 144. The Americanbranch of the Russian Orthodox Churchhad created a corporation under New York
state law in 1925 to acquire a cathedral as‘‘a central place of worship and residenceof the ruling archbishop.’’ Id., 73 S.Ct. at144. Title was in the corporation’s name.Id. at 96 n.1, 73 S.Ct. at 144 n.1. The onlyissue was who had the right to use thecathedral—Archbishop Leonty, who waselected to his ecclesiastical office by theAmerican churches, or Archbishop Benja-min,60 who was appointed by the SupremeChurch Authority of the Russian OrthodoxChurch in Moscow. Id. at 96 & n.1, 73S.Ct. at 144 & n.1. The Court observedthat determination of the right to use andoccupy the cathedral depended ‘‘uponwhether the appointment of Benjamin bythe Patriarch or the election of the Arch-bishop for North America by the conven-tion of the American churches validly se-lects the ruling hierarch for the Americanchurches.’’ Id. at 96–97, 73 S.Ct. at 144.
The lower state courts concluded thatthe cathedral had to be occupied by anarchbishop appointed by the central au-thorities in Moscow (i.e., Benjamin). SaintNicholas, 96 N.E.2d at 67. The higheststate court disagreed, relying on a statestatute that ‘‘had a conclusive effect uponthe issues presented,’’ in addition to thefact that the lower courts had not deter-mined whether Benjamin et al. ‘‘could berelied upon to carry out faithfully and ef-fectively the purposes of the religious
59. Maryland ended in dismissal from the U.S.Supreme Court because the state court’s reso-lution of the church property dispute involvedno inquiry into religious doctrine. 396 U.S. at367–68, 90 S.Ct. at 499–500. In his concur-ring opinion, Justice Brennan recited that un-der Watson, a majority of a congregationalchurch or the highest authority of a hierarchi-cal church could make the property decision‘‘unless ‘express terms’ in the ‘instrument bywhich the property is held’ condition theproperty’s use or control in a specified man-ner’’ as long as those express conditions maybe effected without consideration of doctrineand as long as the appropriate church govern-
ing body can be determined without the reso-lution of doctrinal questions and without ex-tensive inquiry into religious policy. 396 U.S.at 368–70 & n.2, 90 S.Ct. at 500–01 & n.2(Brennan, J., concurring).
60. Benjamin ordained Kedroff as a priest,and Kedroff then ‘‘gave’’ the cathedral toBenjamin. See Saint Nicholas Cathedral ofRussian Orthodox Church in N. Am. v. Ked-roff, 302 N.Y. 1, 96 N.E.2d 56, 67 (1950), rev’dsub nom. Kedroff, 344 U.S. 94, 73 S.Ct. 143,97 L.Ed. 120 (1952).
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trust,’’ and the fact that the Moscow patri-archy functioned ‘‘as an arm of the Rus-sian Government to further its domesticand foreign policy.’’ Id. at 67–68, 96 N.E.2d56, 67. The statute upon which the statecourt relied purported to define the ‘‘Rus-sian Church in America,’’ and to define‘‘Russian Orthodox church’’ as a term ofart ‘‘to denote the particular local buildingsor organizations of the Russian Orthodoxfaith as distinguished from the spiritualchurch’’ and, using that term of art, pur-ported to identify who was the church’sleader. Id. at 69–70, 96 N.E.2d 56, 67(quoting the statute, which provided, inpertinent part, that ‘‘[e]very Russian Or-thodox church in this state TTT shall recog-nize and be and remain subject to thejurisdiction and authority of the TTT gov-erning bodies and authorities of the Rus-sian Church in America, pursuant to thestatutes for the government thereofadopted at a general convention TTT heldin the city of New York’’). The state courtrelied on the legislative determination thatthe ‘‘Russian Church of America’’ was thetrustee that could be relied upon ‘‘to carryout more effectively and faithfully the pur-poses of th[e] religious trust.’’ Id. at 72, 96N.E.2d 56, 67.
Predictably, the losing party in the statecourt appealed to the Court, challengingthe state statute as invalid based on inter-ference with the exercise of religion. Ked-roff, 344 U.S. at 100, 73 S.Ct. at 146. Thestatute had come into being because of‘‘differences between the Mother Churchand its American offspring.’’ Id. at 105, 73S.Ct. at 149. The Court concluded thatbecause the statute undertook by its termsto transfer the control of the New Yorkchurches of the Russian Orthodox religionfrom the central governing hierarchy ofthe Russian Orthodox Church—the Patri-arch of Moscow and the Holy Synod—tothe governing authorities of the RussianChurch in America, it violated the Four-
teenth Amendment. Id. at 107–08, 73 S.Ct.at 150 (‘‘Legislation that regulates churchadministration, the operation of thechurches, [and] the appointment of clergy,by requiring conformity to church stat-utes’’ adopted by the general convention ofthe Russian Church in America held inNew York City in 1937 ‘‘prohibits the freeexercise of religion’’). This was impermissi-ble, even though the legislature had soughtto protect ‘‘the American group from infil-tration of [the Russian Government’s]atheistic or subversive influences’’ whenthe legislature gave the use of thechurches to the American group ‘‘on thetheory that this church would most faith-fully carry out the purposes of the reli-gious trust.’’ Id. at 109–10, 73 S.Ct. at 151.
The Court then proceeded to review itsprecedent with regard to hierarchicalchurches, which it defined as ‘‘those orga-nized as a body with other churches havingsimilar faith and doctrine with a commonruling convocation or ecclesiastical head.’’Id. at 110–14, 73 S.Ct. at 151–53 (referenc-ing Watson, 80 U.S. at 727). The Courtconcluded that the controversy over theright to use the cathedral was ‘‘strictly amatter of ecclesiastical government, thepower of the Supreme Church Authority ofthe Russian Orthodox Church to appointthe ruling hierarch of the archdiocese ofNorth America,’’ and that the statute, byfiat, displaced one church administratorwith another and passed the control ofstrictly ecclesiastical matters from onechurch authority to another in violation ofthe federal constitution. Id. at 115–16, 119,73 S.Ct. at 154–56 (‘‘Freedom to select theclergy, where no improper methods ofchoice are proven TTT must now be said tohave federal constitutional protection as apart of the free exercise of religion againststate interference.’’).
[7] In sum, then, the transfer by stat-ute of control over churches, including the
390 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
determination thereby of church leader-ship, violates the constitutional rule of sep-aration between church and state. Id. at110, 73 S.Ct. at 151; see also Kreshik v.Saint Nicholas Cathedral, 363 U.S. 190,191, 80 S.Ct. 1037, 1038, 4 L.Ed.2d 1140(1960) (applying the same rule to judicialpronouncements). But at issue in the casebefore us is not a statute that may or maynot unconstitutionally infringe upon theparties’ freedom of religion or the identifi-cation of religious leadership. Rather, weare to consider our business organizations,property, and trust statutes within theconfines of the nondoctrinal portions of theparties’ governing documents to determinewhether the Corporation followed its arti-cles and bylaws and whether a trust ortrusts were created, and if so, for whom.
(c) Presbyterian Church v. Mary Eliza-beth Blue Hull Memorial Presbyte-rian Church, 393 U.S. 440, 89 S.Ct.601, 21 L.Ed.2d 658 (1969).
Presbyterian Church, which involved achurch property dispute in which two localchurches withdrew from a hierarchical na-tional church, formalized the neutral prin-ciples framework as an option for resolvingsuch disputes. 393 U.S. at 441, 449, 89S.Ct. at 602, 606. In 1966, the membershipof two local churches, under the leadershipof their ministers and most of their rulingelders, voted to withdraw and reconstitutethemselves as autonomous organizationsafter they concluded that some of the na-tional church’s actions and pronounce-ments violated the organization’s constitu-tion and departed from the doctrine andpractice that were in force at the time theyaffiliated. Id. at 442–43, 89 S.Ct. at 602–03.The state courts considered the impliedtrust theory and integrated a departure-from-doctrine element that allowed a juryto conclude that the local churches shouldretain their property. Id. at 443–44, 449–50, 89 S.Ct. at 603, 606.
The Court noted that while the FirstAmendment severely circumscribes therole that civil courts may play in resolvingchurch property disputes, not all such dis-putes are precluded from the civil courts’consideration. Id. at 447, 449, 89 S.Ct. at605–06 (observing that in Kedroff, theCourt converted into a constitutional ruleWatson’s principle as to the binding andconclusive nature of a hierarchical court’secclesiastical decisions in the absence offraud or collusion, even when affecting civilrights). Specifically, ‘‘there are neutralprinciples of law, developed for use in allproperty disputes, which can be appliedwithout ‘establishing’ churches to whichproperty is awarded.’’ Id. at 449, 89 S.Ct.at 606. But to do this, states, religiousorganizations, and individuals must struc-ture relationships involving church proper-ty so as not to require the civil courts toresolve ecclesiastical questions. Id., 89S.Ct. at 606.
Accordingly, the Court reversed the de-cision of the state court as violating theFirst Amendment because the departure-from-doctrine element required the statecourt to determine matters at the verycore of a religion—whether the generalchurch’s challenged actions departed sub-stantially from prior doctrine pursuant tothe court’s interpretation of the doctrine’smeaning and then, after assessing the rela-tive significance to the religion of the ten-ets from which departure was found,whether the issue on which the generalchurch departed ‘‘holds a place of suchimportance in the traditional theology as torequire that the trust be terminated.’’ Id.at 449–50, 89 S.Ct. at 606–07. The Courtremanded the case for further proceed-ings. Id. at 452, 89 S.Ct. at 607 (statingthat a civil court may no more review achurch decision applying a state depar-ture-from-doctrine standard than it mayapply that standard itself).
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On remand, the state court held that, inlight of the Supreme Court’s pronounce-ment on the departure-from-doctrine ele-ment, the implied-trust theory itself wasno longer valid. Presbyterian Church inU.S. v. E. Heights Presbyterian Church,225 Ga. 259, 167 S.E.2d 658, 659 (1969),cert. denied, 396 U.S. 1041, 90 S.Ct. 680, 24L.Ed.2d 685 (1970). Accordingly, becauseno trust was created for the generalchurch in the property’s deed or requiredby the general church’s constitution, andbecause the general church had put nofunds into the property, legal title to theproperty remained with the local churches.Id. at 659–60.
(d) Serbian Eastern Orthodox Diocesefor the United States of America &Canada v. Milivojevich, 426 U.S.696, 96 S.Ct. 2372, 49 L.Ed.2d 151(1976).
Milivojevich involved a challenge to thesuspension, removal, and defrocking of abishop in—and the reorganization of hisdiocese into three dioceses by—the Serbi-an Orthodox Church. 426 U.S. at 697–98,96 S.Ct. at 2375. The basic dispute, accord-ing to the Court, arose from a quarrel overcontrol of the Serbian Eastern OrthodoxDiocese for the United States of Americaand Canada, its property, and its assets.Id. at 698, 96 S.Ct. at 2375. Years beforethe dispute arose, the Serbian EasternOrthodox Diocese for the United Statesand Canada and other nonprofit corpora-tions were organized under the state lawsof Illinois, New York, California, andPennsylvania to hold title to property. Id.at 701–02, 96 S.Ct. at 2377. In the yearsimmediately before the dispute, the bishophad been the subject of numerous com-plaints challenging his fitness to serve andhis administration of the diocese. Id. at702, 96 S.Ct. at 2377. He subsequentlyrefused to accept either his suspension orthe reorganization of his diocese on the
basis that they were not done in compli-ance with the Mother Church’s constitu-tion and laws and his diocese’s constitu-tion. Id. at 704, 96 S.Ct. at 2378. Thisultimately led to his defrocking and hisdiocese’s declaration that it was autono-mous. Id. at 705–06, 96 S.Ct. at 2379.
Prior to his defrocking, the bishop hadsued to enjoin the Mother Church frominterfering with the assets of the nonprofitcorporations and to have himself declaredthe true bishop. Id. at 706–07, 96 S.Ct. at2379. The Mother Church’s representa-tives counterclaimed for a declaration thathe had been removed as bishop and thatthe diocese was properly reorganized, andthey sought control of the reorganizeddioceses and diocesan property. Id. at 707,96 S.Ct. at 2379. The Illinois trial courtgranted summary judgment for the ex-bishop and dismissed the Mother Church’scountercomplaints. Id., 96 S.Ct. at 2379.After the intermediate appellate court re-versed that judgment and remanded thecase for a trial on the merits, the trialcourt gave each side some relief. Id. at707–08, 96 S.Ct. at 2379–80.
In its judgment on remand, the trialcourt concluded that no substantial evi-dence was produced that fraud, collusion,or arbitrariness existed in any of the ac-tions or decisions before or during thefinal proceedings of the defrocking deci-sion; that the property held by the corpo-rations was held in trust for all membersof the American-Canadian Diocese; thatthe Mother Church exceeded its authorityby dividing the diocese into three newdioceses; and that the new bishop wasvalidly appointed as temporary administra-tor of the whole diocese in place of thedefrocked bishop. Id., 96 S.Ct. at 2379–80.
The Illinois Supreme Court reversedpart of the trial court’s judgment, holdingthat the ex-bishop’s removal and defrock-
392 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
ing had to be set aside because the pro-ceedings resulting in those actions ‘‘wereprocedurally and substantively defectiveunder the internal regulations of the Moth-er Church and were therefore arbitraryand invalid’’ when not conducted accordingto the court’s interpretation of the MotherChurch’s constitution and penal code, andit purported to reinstate him. Id. at 698,708, 96 S.Ct. at 2375, 2380. But it affirmedpart of the trial court’s judgment, agreeingthat the diocesan reorganization was inval-id as beyond the Mother Church’s scope ofauthority to do so without diocesan ap-proval. Id. at 708, 96 S.Ct. at 2380.
Thirteen years after the litigation’s in-ception, the U.S. Supreme Court reversedthe Illinois Supreme Court’s judgment,holding that the inquiries that the Illinoiscourt had made ‘‘into matters of ecclesias-tical cognizance and polity and [its] actionspursuant thereto contravened the Firstand Fourteenth Amendments.’’ Id. at 698,706–07, 96 S.Ct. at 2375, 2379.
Specifically, the Court stated that the‘‘fallacy fatal to the judgment of the Illi-nois Supreme Court is that it rests uponan impermissible rejection of the decisionsof the highest ecclesiastical tribunals ofthis hierarchical church upon the issues indispute’’ and that the court had impermis-sibly substituted its own inquiry intochurch polity and the resolutions basedthereon to those disputes. Id. at 708, 96S.Ct. at 2380. The state supreme court’sconclusion that the Mother Church’s deci-sions were ‘‘arbitrary’’ was based on thecourt’s conclusion that the Mother Churchhad not followed its own laws and proce-dures in arriving at those decisions. Id. at712–13, 96 S.Ct. at 2382. But, as the Courtpointed out, there is no ‘‘arbitrariness’’exception to the First Amendment. Id. at
713, 96 S.Ct. at 2382. ‘‘[R]ecognition ofsuch an exception would undermine thegeneral rule that religious controversiesare not the proper subject of civil courtinquiry, and that a civil court must acceptthe ecclesiastical decisions of church tribu-nals as it finds them.’’ Id., 96 S.Ct. at 2382.
Because the case’s resolution ‘‘essential-ly involve[d] not a church property dis-pute, but a religious dispute the resolutionof which TTT is for ecclesiastical and notcivil tribunals,’’ the state supreme courthad overstepped its authority. Id. at 709,717, 721, 96 S.Ct. at 2380, 2384, 2386 (ob-serving that there was no dispute thatquestions of church discipline and the com-position of the church hierarchy were atthe core of ecclesiastical concern). The hi-erarchical church’s religious bodies madethe decisions to suspend and defrock thebishop, and the authority to make thosedecisions was vested solely in them. Id. at717–18, 96 S.Ct. at 2384. And as to thediocesan reorganization, the court had im-permissibly substituted its own interpreta-tions of the diocesan and Mother Church’sconstitutions for that of the highest ecclesi-astical tribunals in which church law vest-ed authority. Id. at 720–21, 96 S.Ct. at2386 (noting that reorganization of the dio-cese involved a matter of internal churchgovernment, an issue at the core of ecclesi-astical affairs).
The Court noted in a footnote, ‘‘No claimis made that the ‘formal title’ doctrine bywhich church property disputes may bedecided in civil courts is to be applied inthis case.’’ 61 Id. at 723 n.15, 96 S.Ct. at2387 n.15. The Court observed, ‘‘Whethercorporate bylaws or other documents gov-erning the individual property-holding cor-porations may affect any desired disposi-
61. The ‘‘formal title’’ doctrine became theneutral principles approach. See Milivojevich,
426 U.S. at 723 n.15, 96 S.Ct. at 2387 n.15.
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tion of the Diocesan property is a questionnot before us.’’ 62 Id. at 724, 96 S.Ct. at2387. The Court nonetheless noted that theMother Church’s decisions to defrock thebishop and to reorganize the diocese ‘‘in noway change[d] formal title to all Diocesanproperty, which continue[d] to be in therespondent property-holding corporationsin trust for all members of the reorganizedDioceses; only the identity of the trusteesis altered by the Mother Church’s ecclesi-astical determinations.’’ See id. at 723 n.15,96 S.Ct. at 2387 n.15.
[8] Accordingly, Milivojevich instructsus to confine our analysis to formal title,corporate bylaws, and other documentsprevalent in the management of non-reli-gious entities rather than to attempt tointerpret internal church government—thecore of which pertains not to business butrather to the mysteries of faith—and toavoid ecclesiastical determinations like anyother proverbial plague.
(e) Jones v. Wolf, 443 U.S. 595, 99 S.Ct.3020, 61 L.Ed.2d 775 (1979).
[9] In Jones, the United States Su-preme Court addressed a dispute over theownership of church property following aschism in a local church affiliated with ahierarchical church organization; in partic-ular, it considered the question of whichfaction of a formerly united congregationwas entitled to possession and enjoymentof the disputed property. 443 U.S. at 597,602, 99 S.Ct. at 3022, 3024. The Court oncemore acknowledged that the First Amend-ment ‘‘prohibits civil courts from resolvingchurch property disputes on the basis ofreligious doctrine and practice.’’ Id. at 602,99 S.Ct. at 3025 (citing Milivojevich, 426
U.S. at 710, 96 S.Ct. at 2381; Maryland,396 U.S. at 368, 90 S.Ct. at 500 (Brennan,J., concurring); Presbyterian Church, 393U.S. at 449, 89 S.Ct. at 606). That is, a civilcourt can resolve a church property dis-pute ‘‘ ‘so long as it involves no consider-ation of doctrinal matters, whether theritual and liturgy of worship or the tenetsof faith.’ ’’ Id., 99 S.Ct. at 3025 (quotingMaryland, 396 U.S. at 368, 90 S.Ct. at 500(Brennan, J., concurring)). It held that theneutral principles approach was consistentwith the federal constitution when merelylooking to the language of the deeds, theterms of the local church charters, statestatutes, and the provisions of the constitu-tion of the general church concerning theownership and control of church property.Id. at 602–03, 99 S.Ct. at 3025.
The Court approved of this methodologybecause before any dispute arises, a reli-gious group could determine its prioritiesas to the disposition of church propertyand enshrine those priorities under theapplicable civil law, making it easy both onthemselves and the court system:
[t]hrough appropriate reversionaryclauses and trust provisions, religioussocieties can specify what is to happento church property in the event of aparticular contingency, or what religiousbody will determine the ownership inthe event of a schism or doctrinal con-troversy [and] TTT [i]n this manner, areligious organization can ensure that adispute over the ownership of churchproperty will be resolved in accord withthe desires of the members.
TTTT
TTT At any time before the disputeerupts, the parties can ensure, if they sodesire, that the faction loyal to the hier-
62. A dissenting justice would have held thatthe state court’s jurisdiction had been invokedby both parties with regard to the churchproperty and claims to diocesan authority,
thus entitling the state court to ask ‘‘if the realBishop of the American-Canadian Diocesewould please stand up.’’ 426 U.S. at 725–26,96 S.Ct. at 2388 (Rehnquist, J., dissenting).
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archical church will retain the churchproperty. They can modify the deeds orthe corporate charter to include a rightof reversion or trust in favor of thegeneral church. Alternatively, the consti-tution of the general church can bemade to recite an express trust in favorof the denominational church. The bur-den involved in taking such steps will beminimal. And the civil courts will bebound to give effect to the result indicat-ed by the parties, provided it is embod-ied in some legally cognizable form.
Id. at 603–04, 606, 99 S. Ct. at 3025–26,3027.
The Court cautioned that in reviewingchurch documents, if the interpretation ofinstruments of ownership would require acivil court to resolve a religious controver-sy, then the court would have to defer tothe resolution of the doctrinal issue by theauthoritative ecclesiastical body. Id. at 604,99 S.Ct. at 3026.
In addressing which faction was entitledto control local church property, the Courtidentified as a fact question for remandwhether Georgia had adopted a presump-tive rule of majority representation withregard to a voluntary religious associa-tion’s being represented by the majority ofits members or whether the corporatecharter or constitution of the generalchurch set out how the identity of the localchurch was to be established if not bymajority rule. Id. at 607–08, 99 S.Ct. at3027–28 (observing that majority rule is
generally employed in the governance ofreligious societies and that a majority fac-tion generally can be identified withoutresolving any question of religious doctrineor polity). The Court observed that if statelaw provided for the identity of the churchto be determined according to the generalhierarchical church’s ‘‘laws and regula-tions,’’ then the First Amendment wouldrequire the civil courts to give deference tothe church’s determination of the localchurch’s identity. Id. at 609, 99 S.Ct. at3028. The implicit corollary of this state-ment would be that if state law did notprovide for the church’s identity to bedetermined by the general hierarchicalchurch’s laws and regulations, then thecourt would need to examine everythingelse to identify the property’s owners.63
[10] Accordingly, Jones instructs usthat we must perform a non-religious-doc-trine-related review, within the context ofour state law, of the language of the deedsand the provisions dealing with ownershipand control of property contained withinthe local and general churches’ governingdocuments—i.e., the plain language to as-certain the parties’ intent—but that if weattempt to divine ownership from thechurch’s ritual and liturgy of worship orthe tenets of its faith, or if interpreting theparties’ documents would require us toresolve a faith-based controversy, then weveer into constitutionally-prohibited terri-tory.
63. The parties have brought no such statestatute to our attention—and we have foundnone—that would allow us to so facilely dis-pose of this appeal. Cf. Calvin Massey, ChurchSchisms, Church Property & Civil Authority,84 St. John’s L. Rev. 23, 34 (2010) (‘‘Virginiahas adopted a statute directing courts how todecide church property disputes whenchurches divide into contending factions.’’(citing Va. Code Ann. § 57-9)). On remandfrom the U.S. Supreme Court, the state court
in Jones held that while the state’s rebuttablepresumption of majority rule could be over-come by reliance on neutral statutes, corpo-rate charters, relevant deeds, and the organi-zational constitutions of the denomination,none of these sources in that case disclosed aprovision that would rebut the majority-rulepresumption. Jones v. Wolf, 244 Ga. 388, 260S.E.2d 84, 84–85 (1979), cert. denied, 444 U.S.1080, 100 S.Ct. 1031, 62 L.Ed.2d 763 (1980).
395Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
(f) Hosanna–Tabor Evangelical Lu-theran Church & School v. E.E.O.C.,565 U.S. 171, 132 S.Ct. 694, 181L.Ed.2d 650 (2012).
[11] In Hosanna–Tabor, the Court re-cently addressed a related ecclesiasticalmatter, reviewing whether the Establish-ment and Free Exercise Clauses of theFirst Amendment bar an employment dis-crimination lawsuit when the employer is areligious group and the employee is one ofthe group’s ministers. 565 U.S. at 176–77,132 S.Ct. at 699. Cheryl Perich went froman elementary school ‘‘lay’’ (also known as‘‘contract’’) teacher to a ‘‘called’’ (alsoknown as ‘‘Minister of Religion, Commis-sioned’’) teacher—both positions of whichgenerally performed the same duties—at areligious school. Id. at 177–78, 132 S.Ct. at699–700. Following an employment dis-pute, Perich’s employer’s congregation vot-ed to rescind her ‘‘call,’’ and her employ-ment was terminated. Id. at 178–79, 132S.Ct. at 700. After reviewing Kedroff andMilivojevich, among others, the Court re-affirmed that it is impermissible for thegovernment to contradict a church’s deter-mination of who can act as its ministersand recognized the ‘‘ministerial exception’’as to the employment relationship betweena religious institution and its ministers. Id.at 185–88, 132 S.Ct. at 704–06 (reasoningthat to require a church to accept or retainan unwanted minister, or to punish achurch for failing to do so, intrudes not
upon a mere employment decision butrather interferes with the church’s internalgovernance and infringes upon the reli-gious group’s right to shape its own faithand mission through its appointments).64
But see McConnell & Goodrich, 58 Ariz. L.Rev. at 336 (explaining that in contrast tothe ministerial exception set out in Hosan-na–Tabor, church property cases present aconflict between two church entitiesthrough which state trust and propertylaw is used to discern the church’s originaldecision and to give legal effect to thatdecision, not a conflict between civil lawand internal church rules).
(2) Supreme Court of Texas Cases
(a) Masterson v. Diocese of NorthwestTexas, 422 S.W.3d 594 (Tex. 2013),cert. denied, ––– U.S. ––––, 135 S.Ct.435, 190 L.Ed.2d 327 (2014).
As instructed by our supreme court inEpiscopal Diocese, we also look to Master-son. See Episcopal Diocese, 422 S.W.3d at653. In Masterson, the court addressedwhat happens to property when a majorityof the membership of a local church—rather than an entire diocese—votes towithdraw from the larger religious bodiesof which it has previously been a part—specifically, TEC and the Episcopal Dio-cese of Northwest Texas. 422 S.W.3d at596. As in the case before us, legal title tothe local church’s property was held by aTexas nonprofit corporation. Id. A doctri-
64. In Hosanna–Tabor, the Court concludedthat the ministerial exception applied to Pe-rich based on the circumstances of her em-ployment: her ministerial title in becoming a‘‘called’’ teacher reflected the six years ofreligious education that she had pursued toobtain the designation; her election by thecongregation, ‘‘which recognized God’s callto her to teach’’; Perich’s having claimed areligious exemption’s housing allowance onher taxes; and Perich’s having taught religionfour days a week and led her students inprayer three times a day, performing ‘‘an
important role in transmitting the Lutheranfaith to the next generation.’’ 565 U.S. at 190–92, 132 S.Ct. at 707–08. Accordingly, theCourt held that because Perich was a ministerunder the exception, the First Amendmentrequired dismissal of her employment dis-crimination suit against her religious employ-er. Id. at 194–95, 132 S.Ct. at 709 (observingthat the exception ensures ‘‘that the authorityto select and control who will minister to thefaithful—a matter ‘strictly ecclesiastical’—isthe church’s alone’’).
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nal dispute with TEC led a majority of thelocal church’s members to vote to amendthe corporation’s articles of incorporationand bylaws to revoke any trusts in favor ofTEC or the diocese that were on the prop-erty. Id. at 596, 598. Predictably, a lawsuitover the property’s possession and use fol-lowed. Id.
The court traced the parties’ back-ground, starting in 1961 when individualsbought some of the land at issue and do-nated it to the Northwest Texas EpiscopalBoard of Trustees for establishment of amission church. Id. at 597. Four yearslater, a group of worshippers filed an ap-plication with the diocese to organize amission, which the diocese approved. Id.TEC made loans and grants to the churchto assist its growth. Id. More individualsbought more land and donated it to thechurch’s board of trustees, and in 1974, thechurch applied for parish status with thediocese and received it. Id. The diocesancanons required that parishes be corpora-tions,65 so the church incorporated underTexas law. Id. All of the property wasconveyed to the corporation; none of thedeeds to the corporation provided for orreferenced a trust in favor of TEC or thediocese. Id.
The corporation’s bylaws provided thatit would be managed by a vestry electedby members of the parish and that thoseelected members ‘‘shall hold office in ac-cordance with the Church Canons.’’ Id. at597 & n.1. The bylaws also described thequalifications for voting at parish meet-ings—being a communicant of the parishas shown on the parish register, at leastsixteen years old, baptized, and a regularcontributor according to the treasurer’srecords—and specified that amendmentsto the bylaws would be by majority vote atan annual parish meeting or at a special
meeting called for that purpose by a ma-jority vote of the duly qualified voters ofthe parish. Id. at 597 & nn.2–3.
Pursuant to the bylaws, the parish helda called meeting in November 2006, seek-ing—among other things—to amend thecorporate bylaws to remove all referencesto TEC and the diocese and to revoke anytrusts that may have been imposed on anyof the corporation’s property by TEC, thediocese, or the original trustees. Id. at 598.After the resolutions passed by majorityvote, amended articles of incorporationchanging the corporate name from ‘‘TheEpiscopal Church of the Good Shepherd’’to the ‘‘Anglican Church of the Good Shep-herd’’ were filed. Id. In conjunction withthese acts, the majority of the church’smembers withdrew from the diocese andTEC and retained possession of the parishproperty. Id.
Like the first round of the case beforeus, in the ensuing litigation between thechurch’s withdrawing faction and the fac-tion that remained loyal to TEC and to thediocese, the parties’ focus was on defer-ence rather than the application of neutralprinciples. Id. at 599. The trial court andthe intermediate appellate court both re-lied on deference to identify the continuingparish and the proper custodians of thechurch’s property. Id. After reviewing bothits own and U.S. Supreme Court prece-dent, our supreme court acknowledged the‘‘neutral principles’’ methodology as thesole applicable methodology, requiringcourts to decide non-ecclesiastical issuessuch as property ownership based on thesame neutral principles of law applicable toother entities while deferring to religiousentities’ decisions on ecclesiastical andchurch polity issues. Id. at 596, 601–07.
65. In contrast, here, under EDFW’s canons,parishes and missions may form a corpora-
tion as an adjunct or instrument but may notincorporate themselves.
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The supreme court concluded that TECis a hierarchical organization. Id. at 608.But the court clarified that the question ofidentifying who owns the property is notnecessarily inextricably linked to or deter-mined by ecclesiastical matters, explainingthat
[t]here is a difference between (1) theBishop’s determining which worshipersare loyal to the Diocese and TEC,whether those worshipers constituted aparish, and whether a parish properlyestablished a vestry, and (2) whether thecorporation’s bylaws were complied withwhen the vote occurred to disassociatethe corporation from the Diocese andTEC.
Id. That is, the corporation, with its secu-lar existence derived from state law and itsarticles of incorporation and bylaws, issubject to a neutral principles determina-tion. Id. Accordingly, the court reversedthe judgment of the court of appeals andremanded the case to the trial court toapply the neutral principles methodology.Id.
The court noted that the trial courtlacked jurisdiction over whether the dio-cese’s bishop was authorized to form a newparish and recognize its membership andwhether he could or did authorize thatparish to establish a vestry or recognizemembers of the vestry because these itemswere ecclesiastical matters of church gov-ernance, questions upon which the trialcourt properly deferred to the bishop’sexercise of ecclesiastical authority. Id.
[12, 13] The court also took the oppor-tunity, in the interest of judicial economy,to address issues likely to be raised onremand in the trial court, some of whichapply directly to the case now before usand are summarized as follows:
1 Absent specific, lawful provisions in acorporation’s articles of incorporationor bylaws otherwise, whether and how
a corporation’s directors or those enti-tled to control its affairs can change itsarticles of incorporation and bylaws aresecular, not ecclesiastical matters, andan external entity—under the formeror current statutory scheme—is notempowered to amend them absent spe-cific, lawful provision in the corporatedocuments. Id. at 609–10 (citing Tex.Bus. Orgs. Code § 3.009; Tex. Rev.Civ. Stat. Ann. art. 1396–2.09).
1 The TEC-affiliated bishop could, as anecclesiastical matter, determine whichfaction of believers was recognized byand was the ‘‘true’’ church loyal to theDiocese and TEC, and courts must de-fer to such ecclesiastical decisions, buthis decision identifying the loyal factionas the continuing parish does not nec-essarily determine the property owner-ship issue, and his decisions on secularlegal questions such as the validity ofthe parish members’ vote to amend thebylaws and articles of incorporation arenot entitled to deference. Id. at 610.
1 If the title to the real property is in thecorporation’s name and the language ofthe deeds does not provide for an ex-press trust in favor of TEC or theDiocese, then the corporation owns theproperty. Id.
1 As to the Dennis Canon’s terms,which provide in part that ‘‘all realand personal property held by or forthe benefit of any Parish, Mission orCongregation is held in trust forTEC,’’—assuming, without deciding,that the Dennis Canon attempted toimpose a trust on the nonprofit corpo-ration’s property and limited the non-profit corporation’s authority over theproperty—these terms do not make atrust expressly irrevocable under Tex-as law. Id. at 613. To the contrary,‘‘[e]ven if the Canon could be read toimply the trust was irrevocable, that
398 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
is not good enough under Texas law.The Texas statute requires expressterms making it irrevocable.’’ Id.
(b) Brown v. Clark, 102 Tex.323, 116 S.W. 360 (1909).
In Brown, the 1909 case upon which thesupreme court relied to resolve the initialmethodology issue in Masterson and Epis-copal Diocese, the supreme court wasfaced with a task similar to the one beforeus: two groups litigated over propertydeeded ‘‘by different persons at differenttimes to trustees for the CumberlandPresbyterian Church at Jefferson, Tex.’’116 S.W. at 361. One group claimed toconstitute ‘‘the church session of the Cum-berland Presbyterian Church at the city ofJefferson, Tex.,’’ while the other claimed tobe ‘‘the church session of the PresbyterianChurch in the United States of America atJefferson, Tex.’’ Id.
At the time, nationally, the CumberlandPresbyterian Church and the PresbyterianChurch of the United States of America(PCUSA) had overcome their differencesand reunited. Id. The members of the Jef-ferson church held differences of opinion‘‘upon the subject of reunion,’’ and thosewho opposed the reunion sued those whoclaimed that the reunion had transferredthe property to PCUSA. Id. at 362. Uponthe conclusion of a bench trial, the trialcourt agreed with the PCUSA faction; theintermediate appellate court disagreed andreversed the trial court’s judgment. Id.
The supreme court declined to addressthe argument that the national churchescould not reunite because the highest courtof the church—to which the decision ofdoctrine and the modification of the con-fession of faith were directed—had exclu-sive jurisdiction over that question. Id. at363–64. Instead, the only question that the
supreme court had jurisdiction to addresswas the effect the reunion had on theproperty when the deed’s plain languagewas made ‘‘to the trustees of the Cumber-land Presbyterian Church at Jefferson,Tex.’’ 66 Id. at 364.
The supreme court concluded that thechurch to which the deed was made stillowned the property and that ‘‘whateverbody is identified as being the church towhich the deed was made must still holdthe title.’’ Id. at 364–65. In reaching theconclusion that the property resided withthe PCUSA faction, the court traced theidentity from the Cumberland-PCUSA re-union, stating,
The Cumberland Presbyterian Churchat Jefferson was but a member of andunder the control of the larger and moreimportant Christian organization, knownas the Cumberland PresbyterianChurch, and the local church was boundby the orders and judgments of thecourts of the church. The Jeffersonchurch was not disorganized by the actof union. It remained intact as a church,losing nothing but the word ‘‘Cumber-land’’ from its name. Being a part of theCumberland Presbyterian Church, thechurch at Jefferson was by the unionincorporated into the PresbyterianChurch of the United States of Amer-icaTTTT those members who recognizethe authority of the PresbyterianChurch of the United States of Americaare entitled to the possession and use ofthe property sued for.
Id. at 365. The supreme court affirmed thetrial court’s judgment. Id.
(c) Westbrook v. Penley, 231S.W.3d 389 (Tex. 2007).
Our supreme court has previously ac-knowledged that when a church dispute
66. The property had been paid for by thelocal church ‘‘in the ordinary way of busi-
ness.’’ Brown, 116 S.W. at 364.
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involves property or a contract and ispurely secular, we have jurisdiction to con-sider it. See Westbrook, 231 S.W.3d at 398–99. Westbrook involved a tort action thatarose from an act of church discipline(shunning) resulting from counseling per-formed by the church’s pastor. Id. at 391.
[14, 15] The court first observed thatthe First Amendment prohibits govern-mental action, including court action, thatwould burden the free exercise of religionby encroaching on a church’s ability tomanage its internal affairs, presenting aquestion of subject matter jurisdiction re-viewed sua sponte and de novo. Id. at 394& n.3, 395 (‘‘[T]he majority of courtsbroadly conceptualize the prohibition as asubject-matter bar to jurisdiction.’’); seeM.O. Dental Lab v. Rape, 139 S.W.3d 671,673 (Tex. 2004) (‘‘[W]e are obligated toreview sua sponte issues affecting jurisdic-tion.’’). To gauge the constitutional validityof a particular civil action, a court mustidentify the nature of the constitutionaland other interests at stake. Westbrook,231 S.W.3d at 396; see David J. Young &Steven W. Tigges, Into the ReligiousThicket-Constitutional Limits on CivilCourt Jurisdiction over Ecclesiastical Dis-putes, 47 Ohio St. L.J. 475, 499 (1986)(describing some steps to take in analyzingintrachurch litigation). ‘‘In determiningwhether subject matter jurisdiction exists,courts must look to the ‘substance andeffect of a plaintiff’s complaint to deter-mine its ecclesiastical implication, not itsemblemata.’ ’’ Westbrook, 231 S.W.3d at405 (quoting Tran v. Fiorenza, 934 S.W.2d740, 743 (Tex. App.—Houston [1st Dist.]1996, no writ)). The difficulty comes indetermining whether a particular disputeis ‘‘ecclesiastical’’ or simply a civil law con-troversy in which church officials happento be involved. Tran, 934 S.W.2d at 743(holding that whether priest had been ex-communicated—divesting him of his
priestly authority—was unavoidably an ec-clesiastical matter even if the truth of thatfact would bar his defamation claim).
[16] ‘‘ ‘Membership in a church createsa different relationship from that whichexists in other voluntary societies formedfor business, social, literary, or charitablepurposes.’ ’’ Westbrook, 231 S.W.3d at 398(quoting Minton v. Leavell, 297 S.W. 615,622 (Tex. Civ. App.—Galveston 1927, writref’d)). Because a church’s autonomy inmanaging its affairs has long been afford-ed broad constitutional protections, thecourt must ask whether its decision of theissues would ‘‘unconstitutionally impedethe church’s authority to manage its ownaffairs.’’ Id. at 397.
[17] Ultimately, in Westbrook, thecourt concluded that subjecting thechurch’s pastor to tort liability for profes-sional negligence as a counselor for engag-ing the church’s disciplinary process oncefacts were revealed that triggered suchdiscipline would have a ‘‘chilling effect’’ onthe church’s ability to discipline membersand deprive churches of their right to con-strue and administer church laws. Id. at400. The court reasoned that
while the elements of Penley’s profes-sional-negligence claim can be definedby neutral principles without regard toreligion, the application of those princi-ples to impose civil tort liability onWestbrook would impinge upon [thechurch’s] ability to manage its internalaffairs and hinder adherence to thechurch disciplinary process that its con-stitution requires.
Id. The secular confidentiality interest rep-resented by Penley’s professional-negli-gence claim failed to override the strongconstitutional presumption that favors pre-serving the church’s interest in managingits affairs, particularly when the pastor’sactions did nothing to endanger Penley’sor the public’s health or safety. Id. at 402,
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404. The values underlying the constitu-tional interest in prohibiting judicial en-croachment upon a church’s ability to man-age its affairs and discipline its members,who have voluntarily united themselves tothe church body and impliedly consentedto be bound by its standards, must bezealously protected, and when presentedwith conflicting interests like those pre-sented in Westbrook, generally ‘‘a ‘spirit offreedom for religious organizations’ pre-vails, even if that freedom comes at theexpense of other interests of high socialimportance.’’ Id. at 403 (internal citationsomitted). Accordingly, after liberally con-struing Penley’s pleadings, the court heldthat the trial court properly dismissed thecase on Westbrook’s plea to the jurisdic-tion. Id. at 405.
(3) Intermediate AppellateCourt Cases
This court’s cases involving churcheshave run the gamut, from the relationshipbetween a church and its ministers, whichwe recognized as of ‘‘prime ecclesiasticalconcern,’’ to whether a church incorporat-ed under the nonprofit corporations actgave proper notice of a business meeting.Compare Smith v. N. Tex. Dist. Council ofAssemblies of God & House of Grace, No.02-05-00425-CV, 2006 WL 3438077, at *3(Tex. App.—Fort Worth Nov. 30, 2006, nopet.) (mem. op.) (affirming dismissal forwant of jurisdiction when appellants suedfor declaration that church’s district coun-cil did not follow church constitution, by-laws, and rules of procedure and for a
division of church’s assets between twocongregations), Dean v. Alford, 994 S.W.2d392, 395 (Tex. App.—Fort Worth 1999, nopet.) (holding that the vote on a pastor’sremoval in a congregational church in-volved a purely ecclesiastical, administra-tive matter), and Patterson v. Sw. BaptistTheological Seminary, 858 S.W.2d 602,603–04 (Tex. App.—Fort Worth 1993, nowrit) (affirming dismissal in wrongful ter-mination suit because case essentially in-volved a religious dispute, the ‘‘key inquiryunder the First Amendment [being]whether a religious organization is makingan ecclesiastical decision’’), with Kelly v.Church of God In Christ, Inc., No. 02-10-00047-CV, 2011 WL 1833095, at *13 n.18(Tex. App.—Fort Worth May 12, 2011, pet.denied) (mem. op.) (avoiding issue ofwhether negligence claims were barred byFirst Amendment by concluding that thetrial court properly granted summaryjudgment on the negligence claims), andRandolph v. Montgomery, No. 02-06-00087-CV, 2007 WL 439026, at *1–2 (Tex.App.—Fort Worth Feb. 8, 2007, no pet.)(mem. op.) (holding no intrusion into eccle-siastical matters when issue was whetherproper notice of business meeting was giv-en by church incorporated under nonprofitcorporations act and trial court merely hadto apply statute’s plain language and applyneutral principles of law). Yet, to the ex-tent the application of neutral principlesrequires discussion and analysis, the issuesnow before us appear to be of first impres-sion. Cf. Smith, 2006 WL 3438077, at *3.67
67. Smith involved an intracongregational dis-pute that arose after some church membersunsuccessfully sought a division of churchassets. 2006 WL 3438077, at *1. One of thecomplaints raised in the ensuing litigationwas that the church constitution, bylaws, andrules of procedure had not been followed. Id.at *2. We agreed that the trial court correctlydismissed the case for want of jurisdictionwhen the plaintiffs’ claims asked the trial
court to determine matters involving clergy,church discipline, and ecclesiastical gover-nance. Id. We noted that the difficulty—ashere—lies in determining whether a particu-lar dispute is ecclesiastical or simply a civillaw controversy in which church officialshappen to be involved. Id. at *3. We held that‘‘[m]atters involving the interpretation ofchurch bylaws and constitutions, the relation-ship between an organized church and its
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This is not so with some of our sistercourts.
For example, the Amarillo court dis-cussed the issue in African MethodistEpiscopal Church, Allen Chapel v. Inde-pendent African Methodist EpiscopalChurch (AMEC), within the context ofwhat the case was not: ‘‘[T]his is not one ofthose suits where the local congregationbecomes divided and each division claimsto have the right to the property to theexclusion of the other members.’’ 281S.W.2d 758, 759 (Tex. Civ. App.—Amarillo1955, writ ref’d n.r.e.) (emphasis added). InAMEC, all of the property was bought andpaid for by the local church, the deed wasmade out to the trustees of the AfricanMethodist Church of Vernon and not tothe mother church, and the entire mem-bership of the local church—including thepastor—quit the mother church. Id. at759–60. When all of the members with-drew from the mother church, dissolvedthe local church, and organized under thename of Independent AMEC of Vernon,Texas, because the trustees held the prop-erty in trust for the benefit of those whohad bought and paid for it, the court con-cluded that the property belonged to thelocal church. Id. at 760. Part of the ratio-nale, however, was that this case precededthe ability of unincorporated nonprofit as-sociations to hold property in any formother than under trustees. See id.; cf. Tex.Bus. Orgs. Code Ann. § 252.003 (West2012) (providing that nonprofit associationsmay acquire, hold, encumber, and transferreal and personal property in this state).
The Texarkana court discussed the issuebefore us in Presbytery of the Covenant v.First Presbyterian Church of Paris, Inc.,552 S.W.2d 865 (Tex. Civ. App.—Texar-kana 1977, no writ). In that case, the ma-jority of the members of the First Presby-terian Church of Paris sought to withdrawfrom the national church, PCUSA, and toaffiliate with another group. Id. at 867.The Presbytery of the Covenant—one ofPCUSA’s governing layers—sought to pre-vent the withdrawing faction from takingpossession of and asserting ownership tothe church property, and the withdrawingfaction sued the Presbytery and others totry title. Id. After a jury trial, the trialcourt rendered judgment for the with-drawing faction. Id. The appellate courtreversed the trial court’s judgment. Id. at872.
On appeal, the court determined thatprior to June 17, 1973—the date of theattempted withdrawal—there was only oneFirst Presbyterian Church of Paris, whichwas affiliated with PCUSA and which hadacquired all of the real property involvedat a time when there was no disagreementover the church property. Id. at 867–69.Each of the deeds named as grantee eitherFirst Presbyterian Church of Paris U.S. orthe corporation First Presbyterian ChurchU.S. of Paris, Inc., which was chartered inTexas in 1966 to hold property for theFirst Presbyterian Church of Paris U.S.Id. at 869. On February 13, 1973, thePresbytery established an administrativecommission in anticipation that some of thelocal congregations might attempt to with-draw from PCUSA and a pastoral letter
minister, and the division of church assets areall ecclesiastical concerns.’’ Id. (citing Milivo-jevich, 426 U.S. at 708–09, 724–25, 96 S.Ct. at2380, 2387–88). However, per the supremecourt’s instructions in Episcopal Diocese andMasterson, we are required to consider thedivision of church assets insofar as we candetermine ownership through the application
of neutral principles and are required in thatanalysis to consider church bylaws and con-stitutions. See Episcopal Diocese, 422 S.W.3dat 651–52; see also Masterson, 422 S.W.3d at606 (observing that many disputes ‘‘will re-quire courts to analyze church documentsand organizational structures to some de-gree’’).
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required written notices prior to calling acongregational meeting to consider a pro-posal to withdraw. Id. The required writ-ten notices were not given; rather, on June10, 1973, oral notice was given from thepulpit of the congregational meeting to beheld on June 17 to consider a resolution towithdraw from PCUSA. Id.
At the June 17, 1973 meeting, 101 of the149 members on the church’s active rollattended the meeting and voted for thewithdrawal. Id. The Presbytery turned thematter over to the administrative commis-sion, which began a process that resultedin the formal suspension and divestiture ofthe local church’s leadership, and in July1973, the commission declared that theaction taken to withdraw was null andvoid. Id. at 869–70. The withdrawing fac-tion transferred the real property and as-sets owned by the First PresbyterianChurch of Paris U.S. to a corporation thatthey attempted to create by way of anamendment to the charter of the FirstPresbyterian Church U.S. of Paris, Inc.,and they affiliated with a schismatic organ-ization, the Vanguard Presbytery of theContinuing Presbyterian Church. Id. at870. Of the 149 members, 30 signed state-ments of loyalty and desire to remain inthe PCUSA-recognized church, and onSeptember 13, 1973, the administrativecommission recognized them as constitut-ing the First Presbyterian Church of ParisU.S. Id.
The Texarkana court first identified thetwo general types of religious organiza-tions recognized in the law: (1) congrega-tional, which is strictly independent of anyother ecclesiastical association and owes nofealty or obligation to any higher authori-ty, and (2) hierarchical, in which the localcongregation is but a subordinate memberof some general church organization inwhich there are superior ecclesiastical tri-bunals with general and ultimate power of
control more or less complete in somesupreme judicatory over the whole mem-bership of that general organization. Id.PCUSA—like TEC—is recognized as a hi-erarchical church, ‘‘at least as to ecclesias-tical matters and church government.’’ Id.
The Texarkana court acknowledged thatcivil courts’ power to resolve disputes re-lating to church property was restricted toan adjudication of property rights by theapplication of neutral principles of law de-veloped for use in all property disputesand that when a hierarchical organizationis involved, the decisions of the highestchurch judicatory to which the questionhas been taken, as to questions of churchdiscipline or government, are—so far asthey are relevant—final and binding on thecivil courts, subject only to narrow reviewif found to have resulted from fraud orcollusion. Id. at 870–71. With regard to theissue before it, the Texarkana court recit-ed that
[w]hen a division occurs in a local churchaffiliated with a hierarchical religiousbody, and a dispute arises between rivalgroups as to the ownership or control ofthe local church property, the fundamen-tal question as to which faction is enti-tled to the property is answered by de-termining which of the factions is therepresentative and successor to thechurch as it existed prior to the division,and that is determined by which of thetwo factions adheres to or is sanctionedby the appropriate governing body ofthe organization. It is a simple questionof identity. In making such a determina-tion, the civil court exercises no role indetermining ecclesiastical questions. Itmerely settles a dispute as to identity,which in turn necessarily settles a dis-pute involving property rights. In doingso, the court applies neutral principles oflawTTTT
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Id. at 871 (citations omitted) (emphasisadded).
Accordingly, the court reasoned that pri-or to June 17, 1973, the First PresbyterianChurch of Paris U.S. and all of its mem-bers were part of PCUSA’s organization,and there was no question that membersdissatisfied with PCUSA’s actions couldwithdraw their membership from the FirstPresbyterian Church of Paris U.S. andthus their affiliation with PCUSA. Id. Butby their unilateral action, the withdrawingmembers could not dissolve the localchurch that was an integral part of PCU-SA when the PCUSA constitution express-ly vested in the presbytery the power todissolve a local church. Id. When the localchurch was not dissolved and still existedafter June 17, it became the prerogative ofPCUSA’s governing judicatories to deter-mine who constituted the lawful congrega-tion of the First Presbyterian Church ofParis U.S. Id. Because the loyal factionhad submitted itself to PCUSA’s judicato-ries and had been recognized as such asthe duly existing local congregation, theyhad ‘‘the identity to make of them theFirst Presbyterian Church of Paris U.S.,and they are entitled to possession andcontrol of the property conveyed to thatchurch.’’ Id.
Specifically, despite the vote by the ma-jority to withdraw from PCUSA, the mem-bers of a church organization ‘‘which ishierarchical as to church government can-not dissolve a local church in contraventionof the governing rules or edicts of themother church, and then re-establish
themselves as an independent church orone associated with a schismatic group andtake the church property with them.’’ Id.at 871–72. The church existed prior to theschism, still existed, and was composed ofthose members who remained loyal toPCUSA and who had been recognized bythe governing judicatories as the localchurch. Id. at 872. The question of thechurch’s right to withdraw from PCUSAwithout the consent of the Presbytery wasone of church government determined ad-versely to the withdrawing faction by theappropriate church tribunals. Id.; see alsoGreen, 808 S.W.2d at 548–49, 552 (relyingon Presbytery of the Covenant to affirmtrial court’s judgment awarding possessionof church property to loyalist group affili-ated with United Pentecostal Church In-ternational, Inc., a hierarchical church,which had adopted UPCI’s bylaws for localchurch government prior to the disputeover property ownership). But see Master-son, 422 S.W.3d at 605 & n.5 (listing Pres-bytery of the Covenant as one of the courtof appeals cases reading Brown as apply-ing a deference approach and applying def-erence principles to hierarchical churchproperty dispute cases); Schismatic &Purported Casa Linda PresbyterianChurch in Am. v. Grace Union Presby-tery, Inc., 710 S.W.2d 700, 705 (Tex.App.—Dallas 1986, writ ref’d n.r.e.) (stat-ing that although the Texarkana court pur-ported to apply neutral principles in Pres-bytery of the Covenant, ‘‘the court in factapplied the deference rule in reaching itsdecision’’),68 cert. denied, 484 U.S. 823, 108S.Ct. 85, 98 L.Ed.2d 46 (1987).
68. Constitutionally speaking, the court inPresbytery of the Covenant did not have achoice about applying deference in that case.Deed construction was not an issue becauseeach of the deeds named either First Presbyte-rian Church of Paris U.S. or the First Presby-terian Church of Paris U.S., Inc. as grantee.552 S.W.2d at 869. Instead, the primary ques-tions before the court were (1) whether PCU-
SA was hierarchical or congregational as toproperty and (2) who was the ‘‘First Presbyte-rian Church of Paris U.S.’’? Id. at 868, 870–72. The court’s answer to the first question—PCUSA was hierarchical—determined the an-swer to the second. Id. at 870–72; see Brown,116 S.W. at 364–65 (holding that the churchthat recognized the authority of PCUSA was
404 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
Because the foregoing cases involvedfacts, legal principles, and analysis similarto those facing us here, they provide guid-ance to us in conducting our analysis.
(4) Other States’ Cases
Because other courts have previouslyfaced strikingly similar facts, we also ex-amine these cases to determine how thosesituations have been resolved.
(a) Diocese of San Joaquin
The annual convention of the Diocese ofSan Joaquin voted to leave TEC and affili-ate with the Anglican Province of theSouthern Cone in December 2007. Dioceseof San Joaquin, 202 Cal.Rptr.3d at 57. InJanuary 2008, TEC disciplined then-Bish-op John-David Schofield, and PresidingBishop Schori ordered him to stop all‘‘episcopal, ministerial, and canonical acts,except as relate to the administration ofthe temporal affairs of the Diocese of SanJoaquin.’’ Id. Approximately a week later,Schofield filed with the California Secre-tary of State an amendment to the articlesof incorporation of the corporation sole 69
to change its name from ‘‘The ProtestantEpiscopal Bishop of San Joaquin’’ to ‘‘TheAnglican Bishop of San Joaquin.’’ Id. Herepresented in the document that theamendment had been duly authorized bythe diocese, whose consent by annual con-vention was required; however, the annualconvention had neither considered nor au-thorized any such amendment. Id. at 56–57.
Presiding Bishop Schori issued Scho-field’s deposition on March 12, 2008, termi-nating and vacating his ecclesiastical andrelated secular offices. Id. at 57–58. None-
theless, on March 27, 2008, Schofield be-gan retitling twenty-seven pieces of realproperty, first granting them to ‘‘The An-glican Bishop of San Joaquin, a CorporateSole,’’ and then transferring them to the‘‘Anglican Diocese Holding Corporation,’’which he had formed to perform the samefunction as the corporation sole and toprotect the property from the provisionalbishop elected by the minority of parishesand members who had not seceded fromTEC. Id. at 58. In its lawsuit, TEC and itsaffiliated diocese sought to reclaim posses-sion of property, among other things. Id.California’s intermediate appellate courtconcluded that the dispute regarding theidentity of the incumbent ‘‘Episcopal Bish-op of the Diocese of San Joaquin’’ was‘‘quintessentially ecclesiastical,’’ as was thecontinuity of the diocese as an entity with-in TEC. Id. at 58–59. On remand, it in-structed the trial court to apply neutralprinciples of law to resolve the propertydisputes on the remaining causes of action.Id. at 59.
At trial, the parties stipulated that all ofthe dates of Schofield’s transfer of theproperty had occurred after he had beenremoved as TEC’s bishop. Id. Accordingly,the trial court concluded that the propertytransfers were void either because theproperty was held in trust for TEC orbecause Schofield lacked the authority tomake the transfers. Id. at 59–60.
On appeal, the court noted that decidingwhether a diocese can leave TEC does notresolve the property dispute; rather,sources such as deeds, bylaws, articles ofincorporation, and relevant statutes mustbe considered under the neutral principlesanalysis. Id. at 63–64. The court also ob-
‘‘identified as being the church to which thedeed was made’’).
69. Under California law, a corporation sole isa perpetual entity through which a religious
organization can administer and manageproperty dedicated to the benefit of that or-ganization. Diocese of San Joaquin, 202 Cal.Rptr.3d at 56 n.1.
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served that the trial court erred in its trustfinding because the Dennis Canon imposedby its terms an express trust in favor ofTEC on property held by a parish, not bya diocese. Id. at 64. It refused to imply atrust on church property because that
almost inevitably puts the civil courtssquarely in the midst of ecclesiasticalcontroversies, in that every dispute overchurch doctrine that produces stronglyheld majority and minority views forcesthe court to determine the true impliedbeneficiaries of the church entities in-volved. The court would be required todetermine which faction continued to ad-here to the ‘‘true’’ faith. This is some-thing a civil court is not permitted to do.‘‘If the civil courts cannot properly de-termine which competing group is thebearer of the true faith, they cannotdetermine for whose benefit title tochurch property is impliedly held intrust.’’
Id. (quoting Barker, 171 Cal.Rptr. at 551).
The court looked at how title to theproperty was held and the structure of thecorporation sole when Schofield attemptedto make the transfers. Id. The validity ofthe 2007 amendments to the diocesan con-stitution and canons were not determina-tive because the corporation sole, not thediocese, held title to the property. Id. Be-cause TEC had ordered Schofield to con-tinue administering the diocese’s temporalaffairs in the January 11, 2008 order, heremained the chief officer of the corpora-tion sole until he was deposed on March12, 2008. Id. at 65. However, his attemptedamendment was not authorized at the 2007diocesan convention as required to be validunder California law. Id. at 65. And thediocesan convention did not attempt to rat-ify the action of the diocesan council intrying to amend the canon requiring titleof the corporation sole to be ‘‘The Protes-tant Episcopal Bishop of San Joaquin’’ un-
til October 2008. Id. at 65–66. Thus, underthe terms of the diocese’s canons, theamendment was invalid. Id. at 66.
Consequently, Schofield’s January 22,2008 attempt to amend the articles of in-corporation was invalid and of no effect.Id. And because that amendment was in-valid, his attempt to transfer propertyfrom the corporation sole known as ‘‘TheProtestant Episcopal Bishop of San Joa-quin’’ to ‘‘The Anglican Bishop of SanJoaquin, a Corporation Sole’’ also failed,because no such entity existed when heexecuted and recorded those deeds be-tween March and August 2008. Id. Like-wise, Schofield’s attempt to transfer thedisputed property from ‘‘The AnglicanBishop of San Joaquin, a CorporationSole’’ to ‘‘The Anglican Diocese HoldingCorporation’’ also failed, and title there-fore remained with the Protestant Episco-pal Bishop of San Joaquin. Id. at 66–67.The court affirmed the judgment re-turning the property to TEC and theTEC-affiliated diocese. Id. at 67.
(b) Diocese of Quincy
The Diocese of Quincy voted to end itsassociation with TEC and entered intomembership with the Anglican Church ofthe Southern Cone in November 2008. Di-ocese of Quincy, 2014 IL App (4th) 130901,¶¶ 1, 383 Ill.Dec. 634, 14 N.E.3d at 1249–50. The dissenters formed the ‘‘Diocese ofQuincy of the Episcopal Church,’’ and theyand TEC (collectively, the TEC dissenters)informed the bank holding approximately$3 million in church assets that a disputehad arisen over the funds’ ownership. Id.¶ 1, 383 Ill.Dec. 634, 14 N.E.3d at 1249.After the bank froze the assets, all partiessought a declaratory judgment on the as-sets’ ownership. Id. ¶ 2, 383 Ill.Dec. 634, 14N.E.3d at 1249. After a three-week benchtrial, the trial court, applying neutral prin-ciples of law, found against the TEC dis-
406 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
senters and issued twenty-one pages offindings with its order. Id. ¶¶ 2, 19, 27, 383Ill.Dec. 634, 14 N.E.3d at 1249, 1252–53.
In affirming the trial court’s judgment,the court recounted that in 1893, the dio-cese had formed a state nonprofit corpora-tion called ‘‘The Trustees of Funds andProperty of the Diocese of Quincy’’ (here-after, Corporation #1) to hold, manage,and distribute the diocese’s funds. Id. ¶ 6,383 Ill.Dec. 634, 14 N.E.3d at 1249–50.TEC was not a party to the 1999 contractbetween the bank and Corporation #1. Id.¶ 7, 383 Ill.Dec. 634, 14 N.E.3d at 1250.Then in 2005, the diocese incorporated as astate nonprofit corporation called the Dio-cese of Quincy (hereafter, Corporation#2). Id. ¶ 8, 383 Ill.Dec. 634, 14 N.E.3d at1250. Corporation #2’s directors weremembers of the diocese, and in March2009, Corporation #2 filed its annual cor-porate report with the state, listing itsdirectors. Id. ¶¶ 8, 10, 383 Ill.Dec. 634, 14N.E.3d at 1250. In April 2009, TEC de-clared void the diocese’s November 2008decision to disaffiliate and elected a newbishop and other new leaders for the dio-cese. Id. ¶ 12, 383 Ill.Dec. 634, 14 N.E.3dat 1250. That same month, Corporation #1filed its annual report with the state, listedits directors, and amended its bylaws toremove references to TEC. Id. ¶ 11, 383Ill.Dec. 634, 14 N.E.3d at 1250. Corpora-tion #1’s amended bylaws provided thatdirectors did not have to be Illinois resi-dents but ‘‘shall be communicants in goodstanding with their parish or missionchurch within the Diocese of Quincy.’’ Id.,383 Ill.Dec. 634, 14 N.E.3d at 1250. TECasked the court to hold that the individualslisted as directors of Corporations #1 and#2 had vacated their offices by leavingTEC and to declare the new persons thathad been elected as the corporations’ di-rectors. Id. ¶ 17, 383 Ill.Dec. 634, 14N.E.3d at 1251.
The court observed that Illinois hadadopted the neutral principles approach,‘‘whereby a court may objectively examinepertinent church characteristics, constitu-tions and bylaws, deeds, state statutes, andother evidence to resolve the matter as itwould a secular dispute.’’ Id. ¶ 44, 383 Ill.Dec. 634, 14 N.E.3d at 1256. The courtfurther noted that deference is unavailablewhen the determination of a church’s hier-archical structure is not easily discernible.Id. ¶ 47, 383 Ill.Dec. 634, 14 N.E.3d at1256. It pointed out that the trial court—after hearing conflicting evidence—hadconcluded that it could not ‘‘constitutional-ly determine the highest judicatory au-thority or the locus of control regardingthe property dispute to which it would berequired to defer,’’ because the diocese’sstatus as a subordinate in a hierarchy was‘‘not clear or readily apparent,’’ renderingdeference unavailable. Id. ¶¶ 20–22, 27, 47,383 Ill.Dec. 634, 14 N.E.3d at 1252–53,1256; cf. Masterson, 422 S.W.3d at 608(‘‘We agree with the court of appeals thatthe record conclusively shows TEC is ahierarchical organization.’’).
Because the central matter underlyingthe parties’ dispute was ‘‘who owns thedisputed property,’’ the court did not haveto determine whether the diocese couldleave TEC or identify the leaders of thecontinuing diocese. Diocese of Quincy,2014 IL App (4th) 130901, ¶ 48, 383 Ill.Dec.634, 14 N.E.3d at 1257. For the propertyat issue—funds in the bank account andthe deed to the ‘‘Diocesan House’’—thedeed reflected that title to the propertywas held by Corporation #1, and its lan-guage did not provide for an express trustin favor of TEC; TEC was likewise not aparty to the contract between Corporation#1 and the bank, and it was undisputedthat TEC had never had any involvementwith the bank account. Id. ¶ 50, 383 Ill.Dec.634, 14 N.E.3d at 1257. The corporationswere not organized under Illinois’s Reli-
407Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
gious Corporation Act, which would haveimposed certain requirements on the incor-porating body with regard to trustee mem-bership. Id. ¶ 51, 383 Ill.Dec. 634, 14N.E.3d at 1257. And the evidence—includ-ing the deed, the bank contract, and thediocese’s constitution and canons—re-vealed nothing to show an express or im-plied trust or any other interest vested inTEC. Id. ¶ 54, 383 Ill.Dec. 634, 14 N.E.3dat 1258. The Dennis Canon provided thatparish property was held in trust for thediocese and TEC but included no ‘‘similarlanguage with respect to diocesan propertybeing held in favor of’’ TEC. Id., 383 Ill.Dec. 634, 14 N.E.3d at 1258. Accordingly,the court affirmed the trial court’s judg-ment.70 Id. ¶ 57, 383 Ill.Dec. 634, 14 N.E.3dat 1259.
(c) Diocese of South Carolina
During the pendency of this appeal, theSupreme Court of South Carolina issuedan opinion—or rather, five opinions, aseach justice wrote separately—touching onsome of the issues before us. See Protes-tant Episcopal Church in the Diocese ofS.C. v. The Episcopal Church, 421 S.C.211, 806 S.E.2d 82, 84, 93 (2017), cert.
denied, No. 17-1136, 2018 WL 838170(Feb. 9, 2018). As recounted by one of thejustices, a majority of three agreed that insecular church disputes, neutral principlesof law should be applied to resolve thecase, while a different majority of threeheld that, with regard to the twenty-eightchurch organizations that acceded to theDennis Canon, a trust in favor of TEC isimposed on the property, putting title inthe national church. Id. at 125 n.72 (Toal,Acting J., dissenting).
(5) Commentary
Unsurprisingly, cases involving churchproperty have attracted a number of schol-arly articles weighing in on various aspectsof the tension between the First Amend-ment and state secular law. See McConnell& Goodrich, 58 Ariz. L. Rev. at 321–22(observing the common pattern of churchproperty disputes and the argumentsmade by each side); Valerie J. Munson,Fraud on the Faithful? The CharitableIntentions of Members of Religious Con-gregations & the Peculiar Body of LawGoverning Religious Property in the Unit-ed States, 44 Rutgers L.J. 471, 509 (2014)
70. In Diocese of San Joaquin, the court distin-guished Diocese of Quincy, observing that theQuincy diocese (Corporation #2) was incor-porated as a nonprofit corporation under Illi-nois law and the property was held, managed,and distributed by another nonprofit corpora-tion (Corporation #1), the directors of whomwere members of Corporation #2. 202 Cal.Rptr.3d at 60–61. In contrast, in the SanJoaquin Diocese, the property was held in thename of the corporation sole with the incum-bent bishop as the single officeholder. Id. at61. The San Joaquin court noted that becausethe Quincy diocese was organized under theIllinois Not-For-Profit Corporation Act in-stead of the Illinois Religious CorporationAct, TEC had no authority to remove andreplace the incorporated diocese’s directors,whereas TEC had more influence and controlover the California corporation sole becauseany amendments to its articles of incorpo-
ration had to be ‘‘authorized by the religiousorganization.’’ Id. (observing that under theIllinois Religious Corporation Act ‘‘a trusteeof a religious corporation can be removedfrom office for, inter alia, abandonment of thedenomination’’); see 805 Ill. Comp. Stat. Ann.110/46d (West, Westlaw through 2018 Legis.Sess.) (providing that the trustee of a corpora-tion organized under the Illinois ReligiousCorporation Act ‘‘may be removed from officewhenever his office shall be declared vacantTTT for an abandonment of the faith of thecongregation, church, society, sect, or denom-ination, or for failure to observe the usages,customs, rules, regulations, articles of associ-ation, constitution, by-laws or canons of thecongregation, church or society, or of theecclesiastical body, or diocesan, or like eccle-siastical officer, having jurisdiction over anyecclesiastical district or diocese).
408 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
(observing that history suggests that reli-gion-based property disputes will alwaysbe around and that ‘‘the only constant inthat body of law has been its utter incon-sistency and uncertainty’’); Bertie D.Jones, Litigating the Schism & Reformingthe Canons: Orthodoxy, Property & theModern Social Gospel of the EpiscopalChurch, 42 Golden Gate U. L. Rev. 151,215 (2012) (asserting that the property dis-putes within TEC are about theology andproposing that ecclesiastical propertycourts would be more efficient to deter-mine the Dennis Canon trust question); R.Gregory Hyden, Comment, Welcome to theEpiscopal Church, Now Please Leave: AnAnalysis of the Supreme Court’s ApprovedMethods of Settling Church Property Dis-putes in the Context of the EpiscopalChurch & How Courts Erroneously Ignorethe Role of the Anglican Communion, 44Willamette L. Rev. 541, 560 (2008) (‘‘Byignoring the judicatory procedures outsideof the national polity of the EpiscopalChurch, courts are not following the prin-ciples they set out for a hierarchicalchurch in either a deference approach or aneutral principles approach.’’); Jeffrey B.Hassler, Comment, A Multitude of Sins?Constitutional Standards for Legal Reso-lution of Church Property Disputes in ATime of Escalating IntradenominationalStrife, 35 Pepp. L. Rev. 399, 455 (2008)(‘‘Churches have not ordered their affairsin ways that lend themselves to easy civilcourt resolution.’’); Fennelly, 9 St. ThomasL. Rev. at 357 (‘‘The unintended conse-quence of neutral principles has been TTT
an unwarranted intrusion into a spherethat lies outside government’s legitimateboundaries of authority.’’); Patty Gersten-blith, Civil Court Resolution of PropertyDisputes Among Religious Organizations,39 Am. U. L. Rev. 513, 519–20 (1990)(observing that Supreme Court jurispru-dence that grants greater deference inproperty disputes to hierarchical religious
organizations than to congregational reli-gious organizations ‘‘would seem to createa structural relationship violative of theestablishment clause’’). These commentar-ies have provided valuable guidance to us.
(6) Summary
[18, 19] Under the neutral principlesmethodology, we are required to applyneutral principles of law to issues such asland titles, trusts, and corporate formation,governance, and dissolution, even when re-ligious entities are involved, Masterson,422 S.W.3d at 606, and ‘‘what happens tothe property is not [an ecclesiastical mat-ter], unless the congregation’s affairs havebeen ordered so that ecclesiastical deci-sions effectively determine the propertyissue.’’ Id. at 607. That is, as set out above,per Jones and Milivojevich, we must per-form a non-religious-doctrine-related re-view of the plain language of the deeds andthe provisions dealing with ownership andcontrol of property contained within thelocal and general churches’ governing doc-uments, confining ourselves to formal title,corporate documents, and other items usedin the secular world to determine owner-ship issues, while avoiding questions aboutthe tenets of faith, including any religioustest as to the parties’ leadership or identi-ty. If a case requires the court only tointerpret a contract or deed but not tointervene in matters of church discipline,internal administration, or membership—or matters of morality or church doc-trine—then it should be a simple matter toresolve a basic civil law controversy thatjust happens to involve a church. See Epis-copal Diocese, 422 S.W.3d at 650 (statingthat under neutral principles, courts ‘‘deferto religious entities’ decisions on ecclesias-tical and church polity issues such as whomay be members of the entities andwhether to remove a bishop’’ while decid-ing issues like property ownership and the
409Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
existence of a trust ‘‘on the same neutralprinciples of secular law that apply to oth-er entities’’). But whether the applicationof the neutral principles approach is un-constitutional depends on how it is applied.Id. at 651; see also Westbrook, 231 S.W.3dat 400, 403. Milivojevich, Kedroff, and Ho-
sanna–Tabor warn us, at all costs, to avoidbecoming unconstitutionally entangled inthe parties’ theological, hierarchical web ofwho is or can be the ‘‘real’’ bishop ordiocese for religious purposes. We havetranslated these and other strictures into aflow chart.
410 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
See Young & Tigges, 47 Ohio St. L.J. at498–99 (‘‘[I]ndeed it is the presence of sucha doctrinal issue which turns a case con-cerning church discipline, organization, orgovernment into an ecclesiastical one call-ing for deference. Once a doctrinal ques-tion is present in a case, it cannot beavoided through neutral principles or anyother approach.’’ (footnote omitted)); seealso Hyden, 44 Willamette L. Rev. at 569–70 (recommending that courts should en-sure that churches wishing to disaffiliatehave first exhausted all remedies availableto them within the structure of the nation-al and international church and, if so, thengive the deference courts traditionally giveto administrative agency decisions). Com-pare Gonzalez v. Roman Catholic Arch-bishop of Manila, 280 U.S. 1, 16, 50 S.Ct.5, 7–8, 74 L.Ed. 131 (1929) (observing thatin the absence of fraud or collusion, ‘‘thedecisions of the proper church tribunals onmatters purely ecclesiastical, although af-fecting civil rights, are accepted in litiga-tion before the secular courts as conclu-sive, because the parties in interest madethem so by contract or otherwise’’), andSingh v. Sandhar, 495 S.W.3d 482, 490(Tex. App.—Houston [14th Dist.] 2016, nopet.) (‘‘While the Supreme Court left openthe possibility that fraud or collusionclaims may serve as vehicles for civil courtreview of ecclesiastical decisions, we havefound no Texas case that has applied suchan exception.’’), with Libhart, 949 S.W.2dat 794 (citing a Washington case for theproposition that when church proceedingsare tainted by fraud, judicial review isappropriate).71
b. State Substantive Law
Within the neutral principles framework,we must consider our state’s associations,corporations, and trust law as applicable tothe case.
(1) Associations Law
EDFW is a Texas nonprofit associationgoverned by chapter 252 of the businessorganizations code. See Tex. Bus. Orgs.Code Ann. §§ 1.103, 252.001 (West 2012).These days, a nonprofit association may bethe beneficiary of a trust, contract, or will.See id. § 252.015 (noting that until Sep-tember 1, 1995, a nonprofit associationcould not hold an estate or interest in realor personal property, so the interest washeld in trust by a fiduciary, but after Sep-tember 1, 1995, the fiduciary could trans-fer the interest to the nonprofit associationin the nonprofit’s name). The nonprofitassociation is separate from its membersfor purposes of determining and enforcingits rights, duties, and liabilities in contractand tort. Id. § 1.002(57)–(58) (West Supp.2017), §§ 3.002, 252.006(a) (West 2012).Under chapter 252, a ‘‘member’’ is a per-son who, under the association’s rules orpractices, may participate in the selectionof persons authorized to manage associa-tion affairs or in the development of associ-ation policy. Id. § 252.001(1). ‘‘A memberof, or a person considered as a member by,a nonprofit association may assert a claimagainst the nonprofit association,’’ and viceversa. Id. § 252.006(d).
[20–22] ‘‘It is generally held that theconstitution and by-laws of a voluntaryassociation, whether incorporated or not,
71. In considering whether a former pastorfraudulently misrepresented material facts inselling church facilities, the Libhart courtquoted the Supreme Court of Washington asprohibiting the use of ‘‘chicanery, deceit, andfraud’’ to divert church property ‘‘to a pur-pose entirely foreign to the purposes of the
organization[ ] for TTT selfish benefit.’’ 949S.W.2d at 794 (quoting Hendryx v. People’sUnited Church of Spokane, 42 Wash. 336, 84P. 1123, 1127 (1906)). The parties in the in-stant case have not specified any fraudclaims.
411Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
are controlling as to its internal manage-ment.’’ Dist. Grand Lodge No. 25 GrandUnited Order of Odd Fellows v. Jones, 138Tex. 537, 160 S.W.2d 915, 922 (1942); Jua-rez v. Tex. Ass’n of Sporting Officials ElPaso Chapter, 172 S.W.3d 274, 279 (Tex.App.—El Paso 2005, no pet.) (‘‘[T]hecourts of this state recognize the right of aprivate association to govern its own af-fairs.’’). Texas courts have recognized thatan association’s bylaws constitute a con-tract between the parties. Monasco v. Gil-mer Boating & Fishing Club, 339 S.W.3d828, 838 n.14 (Tex. App.—Texarkana 2011,no pet.). But see Westbrook, 231 S.W.3d at398 (quoting Minton, 297 S.W.2d at 621–22, for the proposition that church mem-bership creates a different relationshipfrom that of other voluntary associations);Harden v. Colonial Country Club, 634S.W.2d 56, 60 (Tex. App.—Fort Worth1982, writ ref’d n.r.e.) (stating that a suiton bylaws and policies is not the type ofbreach-of-contract suit contemplated bythe legislature with regard to the recoveryof attorney’s fees). The constitution andbylaws of an association confer no legalrights on nonmembers. Schooler v. Tar-rant Cty. Med. Soc’y, 457 S.W.2d 644, 647(Tex. Civ. App.—Fort Worth 1970, nowrit).
[23, 24] By becoming a member of anassociation, an individual ‘‘subjects himself,within legal limits, to the association’s pow-er to administer as well as its power tomake its rules.’’ Harden, 634 S.W.2d at 59.The actions of the association’s leadershipare permissible and binding on the associa-tion’s membership so long as they are notillegal, against some public policy, orfraudulent. Id. at 60 (refusing judicial in-tervention in association’s internal disputeover rules pertaining to sale of countryclub membership); see also Whitmire v.Nat’l Cutting Horse Ass’n, No. 02-08-
00176-CV, 2009 WL 2196126, at *4 (Tex.App.—Fort Worth July 23, 2009, pet. de-nied) (mem. op.) (‘‘Judicial review is onlyproper when the actions of the organiza-tion are illegal, against some public policy,arbitrary, or capricious.’’). But see Milivo-jevich, 426 U.S. at 713, 96 S.Ct. at 2382(disavowing an exception for arbitrarinessas to religious associations). Legislative en-actment dictates what is public policy inthis state. See Dist. Grand Lodge No. 25,160 S.W.2d at 920; see also Dickey v. ClubCorp. of Am., 12 S.W.3d 172, 177 (Tex.App.—Dallas 2000, pet. denied) (holdingthat membership in a golf club is not avaluable property right, particularly whenplaintiffs did not allege gender inequity ordiscrimination and there was no claim offraud or illegality, and that ‘‘[i]f the courtswere to intervene each time members of agolf club felt that restrictions on tee timeswere unreasonable, operation of such clubswould become unmanageable and valuablejudicial resources would be wasted’’). Com-plaints that attract judicial review arethose that ‘‘allege a wholesale deprivationof due process or the opportunity to beheard in violation of some civil or propertyright.’’ Whitmire, 2009 WL 2196126, at *5;see Stevens v. Anatolian Shepherd DogClub of Am., Inc., 231 S.W.3d 71, 74–75(Tex. App.—Houston [14th Dist.] 2007, pet.denied) (reciting that despite the generalrule of noninterference with a voluntaryassociation’s internal management, courtswill interfere in a private association’s in-ner-dealings if a valuable right or propertyinterest is at stake or if association fails toaccord members ‘‘something similar to dueprocess’’).
The TEC parties assert that Appelleeslost EDFW’s property when they disasso-ciated from TEC, and they refer us toseveral cases to support their position. SeeInt’l Printing Pressman v. Smith, 145
412 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
Tex. 399, 198 S.W.2d 729, 736 (1946); 72
Dist. Grand Lodge No. 25, 160 S.W.2d at920; 73 see also Progressive Union of Tex.
72. In International Printing, Smith sued theparent union for his wrongful expulsion fromthe local union, a chartered subordinate or-ganization, after it failed to follow the parentunion’s rules in expelling him. 198 S.W.2d at731–32. After a jury trial, the trial court is-sued a JNOV for the union, but the supremecourt rendered judgment for Smith. Id. at731, 738. The court held that Smith’s expul-sion was illegal and void—the result of ‘‘abreach of the fundamental guarantees estab-lished by the union for the protection of therights of the individual member,’’ id. at 732,and while the parent union contended that itwas not responsible for its subordinate unit’sactions, the local union had acted as its agentand was ‘‘but the alter ego of the nationalorganization’’ when it breached the con-tract—constitution and bylaws—between theorganization and its members. Id. at 733–34,736, 742–43. That is, while the local unioncould elect its own officers and adopt its ownconstitution and bylaws, the parent union’sconstitution and bylaws took precedence, reg-ulating in detail how the local union couldoperate and its officers’ performance of theirduties. Id. at 733. The parent union could alsoforfeit the local union’s charters, take over theadministration of its affairs, and remove andexpel its officers for a failure to perform theirduties. Id. And while the parent union’s con-stitution and bylaws did not contain any ex-press promise to allow union members toremain members and enjoy the benefits there-of, the court held that there was an impliedobligation to allow a member to enjoy thebenefits of his membership ‘‘so long as hecomplies with the obligations imposed by theconstitution and by-laws.’’ Id. at 737–38.
73. In Grand Lodge, the supreme court consid-ered whether the property held by a defunctlocal fraternal lodge would go to its membersor to the grand lodge of which the local lodgehad been a constituent member. 160 S.W.2dat 920. Grand Lodge, a fraternal benefit soci-ety organized in 1890, sued members of thedefunct local lodge in a trespass-to-try-titleaction involving three lots. Id. at 917–18. Thelocal lodge had been one of Grand Lodge’ssubordinate lodges when it acquired the lotsbut became ‘‘defunct’’ in 1936, paying nomembership dues or assessments to eitherGrand Lodge or the national organization. Id.at 918. The lots, acquired between 1909 and1920, were paid for by the local lodge’s mem-
bers, and none of Grand Lodge’s or the na-tional organization’s funds were used directlyor indirectly in purchasing the lots or makingimprovements upon them. Id. The deeds wereexecuted to named members of the locallodge ‘‘as trustees of said Local Lodge and totheir successors in trust for said lodge.’’ Id. In1936, the self-described duly elected and qual-ified trustees of the local lodge executed gen-eral warranty deeds conveying the lots to thir-ty-four individuals (including themselves) as‘‘all of the present qualified and paid upmembers’’ of the lodge, which ‘‘is contemplat-ed to be dissolved.’’ Id.
The court construed Grand Lodge’s consti-tution and bylaws, which had been in effectsince 1908 and which provided that title to allproperty acquired by subordinate lodges wasas trustee for and for the benefit of GrandLodge, that no property held by a subordinatelodge could be mortgaged, sold, or otherwiseencumbered without written permission andconsent from Grand Lodge, and that when asubordinate lodge became defunct, all of theproperty held in trust by the local lodge ‘‘shallbe taken over TTT and re-possessed by theDistrict Grand Lodge’’ and ‘‘shall vest abso-lutely in the District Grand Lodge.’’ Id. at918–19. The court then looked to the statutoryprovisions relating to incorporated lodges—even though Grand Lodge was not incorpo-rated—to determine whether Grand Lodge’sconstitution and bylaws were contrary to thepublic policy stated therein and observed thatthe statutory language ‘‘is clear and unequivo-cal and plainly states what is to become of theproperty of a defunct local lodge’’—i.e., itpasses to and vests in the grand body towhich it was attached. Id. at 920–21 (refer-ring to the statute ‘‘merely as a legislativestatement of the [underlying] public policy’’).Accordingly, the court held that the applica-ble provisions in Grand Lodge’s constitutionand bylaws were not contrary to public poli-cy, making Grand Lodge the lots’ owner be-cause its constitution and bylaws ‘‘became apart of the contract entered into by the defen-dants when they became members of the or-der and whatever rights defendants had in thelots in controversy were merely incidental totheir membership and terminated absolutelywith such membership.’’ Id. at 920. While thelocal lodge had held superior equitable titlebased on the deeds’ language, when it became
413Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
v. Indep. Union of Colored Laborers, 264S.W.2d 765, 768 (Tex. Civ. App.—Galves-ton 1954, writ ref’d n.r.e.); 74 see generallyTex. Bus. Orgs. Code Ann. § 23.110(a)(West 2012) (providing that when a subor-dinate body attached to a grand body iswound up and terminated, ‘‘all propertyand rights existing in the subordinate bodypass to and vest in the grand body towhich it was attached, subject to the pay-ment of any debt owed by the subordinatebody’’).
[25] The business organizations codehas a separate chapter for ‘‘special-pur-pose’’ corporations. See Tex. Bus. Orgs.Code Ann. §§ 23.001–.110 (West 2012).This category applies to business develop-ment corporations, which are formed ‘‘topromote, develop, and advance the pros-perity and economic welfare of this state,’’id. § 23.052, and to ‘‘Grand Lodges,’’ suchas the Free Masons, Knights Templar,Odd Fellows, or ‘‘similar institution or or-der organized for charitable or benevolentpurposes.’’ 75 Id. § 23.101; see also CKB &
defunct, it lost its interest in the lots. Id. at920, 923; cf. Simpson v. Charity BenevolentAss’n, 160 S.W.2d 109, 109–10, 112–13 (Tex.Civ. App.—Fort Worth 1942, writ ref’dw.o.m.) (holding claimants did not show titlevested in them when local lodge purchasedproperty three years before adoption of by-laws upon which claimants relied and entityunder which claimants claimed title was notlocal lodge’s parent organization).
74. In Progressive, the court observed that it‘‘is well settled that when a person ceases tobe a member of a voluntary association, hisinterest in its funds and property ceases andthe remaining members become jointly enti-tled thereto,’’ even when the majority secedesand organizes a new association. 264 S.W.2dat 768. In that context, 17 individual incorpo-rators obtained a charter for a union in 1930and became the union’s supreme council,which supplied a franchise to Lodge No. 1, anunincorporated association. Id. at 766. Thefranchise authorized the organization ofLodge No. 1 and gave it a constitution, by-laws, and a password. Id. Lodge No. 1 collect-ed dues and assessments from its membersand regularly paid dues to the supreme coun-cil. Id. Lodge No. 1 subsequently acquiredsome property and purported to adopt a con-stitution and bylaws authorizing its officers toexecute legal documents in connection there-with. Id. at 766–67. By 1951, Lodge No. 1 hadover 1,000 members, had paid off the indebt-edness on its land, and had around $8,500. Id.at 767. As resentment towards the supremecouncil festered, some of the officers of LodgeNo. 1 became incorporators of the Progres-sive Union of Texas, to which the State ofTexas issued a charter. Id. Those incorpo-rators/officers executed a deed conveying
Lodge No. 1’s property to Progressive andwithdrew Lodge No. 1’s funds but continuedto make reports to the supreme council asLodge No. 1 for two or three months. Id. Themajority of Lodge No. 1’s members ultimatelyaffiliated with Progressive, while 60 or 70members of Lodge No. 1 continued to holdmeetings separately. Id. Litigation ensued,and the remaining members of Lodge No. 1prevailed in a jury trial. Id. Progressive ap-pealed, complaining that the trial court’sjudgment affected the rights of 900 persons,representing 96% of Lodge No. 1’s formermembership, but to no avail. Id. at 768. Thecourt likewise observed that the evidence wassufficient to support the jury’s finding that theincorporator/officers had withdrawn as mem-bers from Lodge No. 1 before executing thedeed, leaving them without the power to con-vey Lodge No. 1’s property. Id.
75. In addition to the implied exclusion ofother types of associations based on the list inthe ‘‘special-purpose’’ statute, grand lodgescan be fraternal benefit societies, subject toadditional rules applicable to their uniquecharacter. See Tex. Ins. Code Ann. § 885.051(West 2009) (defining ‘‘fraternal benefit soci-ety’’ in part as a corporation, society, order,or voluntary association that has a lodge sys-tem and representative form of government,with or without limiting its membership to asecret fraternity); Wonderful Workers of theWorld v. Winn, 31 S.W.2d 879, 881 (Tex. Civ.App.—Waco 1930, writ dism’d w.o.j.) (‘‘Thecharter, constitution, bylaws, and rules of ap-pellant offered in evidence show that it con-sists of a grand lodge with subordinatelodges, and is a fraternal benefit society ascontemplated by articles 4820, 4821, 4822,
414 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
Assocs., Inc. v. Moore McCormack Petro-leum, Inc., 734 S.W.2d 653, 655 (Tex. 1987)(explaining the maxim expressio unius estexclusio alterius to mean ‘‘that the namingof one thing excludes another’’); Johnsonv. Second Injury Fund, 688 S.W.2d 107,108–09 (Tex. 1985) (‘‘The legal maxim Ex-pressio unius est exclusio alterius is anaccepted rule of statutory construction inthis state’’ through which the express men-tion or enumeration ‘‘of one person, thing,consequence or class is equivalent to anexpress exclusion of all others’’). While thefacial simplicity of comparing grand lodgesto the types of associations here is allur-ing, we cannot conclude that the statutoryprinciples applicable to grand lodges applyto entities that lack grand lodges’ definingcharacteristics.76
Furthermore, labor unions and lodges—and the policies and law applicable tothem—have more in common with eachother than with hierarchical religious as-sociations. Compare Westbrook, 231S.W.3d at 398 (identifying distinction be-tween church membership and that ofother voluntary associations formed forbusiness, social, literary, or charitablepurposes), with Comment, State CourtHolds Union Must Reinstate & Compen-sate Members Wrongfully Expelled forIntra-Union Political Activity: Madden v.Atkins, 59 Colum. L. Rev. 190, 190 (1959)
(‘‘Labor unions were early characterizedas unincorporated associations not forprofit and thus were governed by legalprinciples which had been formulated forsocial and benevolent organizations.’’(footnotes omitted)). As one commentatorhas noted,
The explicitly stated purpose of limitingthe local union’s retention of its propertyis to strengthen the national labor or-ganization and increase its bargainingpower. In the context of church propertydisputes, the goal of favoring andstrengthening the religious hierarchy isnot legitimate because it would clearlyviolate the establishment clause of the[F]irst [A]mendment.
Gerstenblith, 39 Am. U.L. Rev. at 570–71(footnote omitted) (referencing Int’l Bhd.of Boilermakers v. Local Lodge D474, 673F.Supp. 199, 203 (W.D. Tex. 1987) (‘‘Othercourts have held that disaffiliation doesjustify a trusteeship since disaffiliationwould have a detrimental effect on thecollective bargaining process.’’)).
Accordingly, the law applicable tolodges, unions, or other special-purposecorporations does not apply to the casebefore us, and we overrule this portion ofthe TEC parties’ issue 1(c). We will ad-dress the remainder of their associationssub-issue in our analysis below.
4823, 4824, and 4834 of the Revised Stat-utes.’’); see also State v. The Praetorians, 143Tex. 565, 186 S.W.2d 973, 975–76 (1945) (ob-serving that respondent, a fraternal benefitassociation operating under a lodge system ofgovernment, was the type of association‘‘dealt with in a separate chapter of the stat-utes TTT and TTT regulated by laws applicableto them alone,’’ and ‘‘regarded by the Legisla-ture as being different from ordinary insur-ance companies and all other organizations’’).
76. For example, under section 23.104, ‘‘Sub-ordinate Lodges,’’ ‘‘[a] subordinate body issubject to the jurisdiction and control of itsrespective grand body, and the warrant or
charter of the subordinate body may be re-voked by the grand body.’’ Tex. Bus. Orgs.Code Ann. § 23.104(c). But TEC’s constitu-tion and canons do not provide for the com-plete disassociation—voluntary or involun-tary—of a diocese by somehow revoking itsmembership in the hierarchical church. In-deed, part of the problem in this case is thatthere was no established framework for disaf-filiation. See Hassler, 35 Pepp. L. Rev. at 455(observing ‘‘an integral part of the nature ofthe belief systems of religious communities isthe hope that their shared beliefs will maketheir temporal unity lasting and secure’’).
415Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
(2) Corporations Law
The Corporation, formed under Texaslaw, came into existence when its certifi-cate of formation was filed. See Tex. Bus.Orgs. Code Ann. § 1.002(22) (explainingthat one of the ‘‘filing’’ entities is a domes-tic entity that is a corporation), § 1.101(West 2012) (stating that Texas law gov-erns the formation and internal affairs ofan entity if the entity files a certificate offormation in accordance with the provi-sions of the business organizations code),§ 3.001(c) (West 2012) (‘‘Formation andExistence of Filing Entities’’). A nonprofitcorporation must include in its certificateof formation whether it will have membersand the number of directors constitutingthe initial board of directors and theirnames and addresses, among other things.Id. § 3.009(1)–(3). In a religious nonprofitcorporation, as here, the board of directorsmay be affiliated with, elected, and con-trolled by ‘‘an incorporated or unincorpo-rated convention, conference, or associa-tion organized under the laws of this oranother state, the membership of which iscomposed of representatives, delegates, ormessengers from a church or other reli-gious association.’’ Id. § 22.207(a).77 Theboard of directors of such a corporationmay be wholly or partly elected by one ormore associations organized under statelaw if the corporation’s certificate of for-mation or bylaws provide for that electionand the corporation has no members withvoting rights. Id. § 22.207(b).
A nonprofit corporation’s board of di-rectors is ‘‘the group of persons vestedwith the management of the affairs of thecorporation, regardless of the name usedto designate the group,’’ and its bylaws are
the rules adopted to regulate or managethe corporation. Id. § 22.001(1), (2) (WestSupp. 2017). Unless a director of a non-profit corporation resigns 78 or is removed,he or she holds office for the period speci-fied in the certification of formation orbylaws and until a successor is elected,appointed, or designated and qualified. Id.§ 22.208(a)–(b) (West 2012). A directormay be removed from office under anyprocedure provided by the certificate offormation or bylaws. Id. § 22.211(a) (West2012). ‘‘In the absence of a provision forremoval in the certificate of formation orbylaws, a director may be removed fromoffice, with or without cause, by the per-sons entitled to elect, designate, or appointthe director.’’ Id. § 22.211(b). If the di-rector was elected to office, his or herremoval requires an affirmative vote equalto the vote necessary to elect the director.Id. Unless otherwise provided by the cer-tificate of formation or bylaws, a vacancyin the board of directors shall be filled bythe affirmative vote of the majority of theremaining directors, regardless of whetherthat majority is less than a quorum. Id.§ 22.212(a) (West 2012).
As to the general standards applicableto the directors of a nonprofit corporation’sboard, a director shall discharge his or herduties ‘‘in good faith, with ordinary care,and in a manner the director reasonablybelieves to be in the best interest of thecorporation,’’ and he or she ‘‘is not liable tothe corporation, a member, or another per-son for an action taken or not taken as adirector if the director acted in compliancewith’’ section 22.221. Id. § 22.221(a), (b)(West 2012). A director is not consideredto have the duties of a trustee of a trust
77. Revised civil statute article 1396, section2.14(B) contained the same provisions. SeeAct of Apr. 23, 1959, 56th Leg., R.S., ch. 162,art. 2.14, 1959 Tex. Gen. Laws 286, 294.
78. Except as provided by the certificate offormation or bylaws, a director of a corpora-tion may resign at any time by providingwritten notice to the corporation. Tex. Bus.Orgs. Code Ann. § 22.2111 (West 2012).
416 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
with respect to the corporation or withrespect to property held or administeredby the corporation, including property sub-ject to restrictions imposed by the donoror transferor of the property.79 Id.§ 22.223 (West 2012).
[26–30] In construing bylaws, we applythe rules that govern contract interpreta-tion. In re Aguilar, 344 S.W.3d 41, 49 (Tex.App.—El Paso 2011, orig. proceeding). Wealso apply the general rules of contractconstruction, as expressed in Texas caselaw, to interpret a Texas corporation’s arti-cles of incorporation. Corcoran v. Atascoci-ta Cmty. Improvement Ass’n, No. 14-12-00982-CV, 2013 WL 5888127, at *2 (Tex.App.—Houston [14th Dist.] Oct. 31, 2013,pet. denied) (mem. op.) (citing HighlandCrusader Offshore Partners, L.P. v. An-drews & Kurth, L.L.P., 248 S.W.3d 887,891 (Tex. App.—Dallas 2008, no pet.)). Weattempt to harmonize and give effect toevery provision, and we presume that theparties intended to impose reasonableterms. Aguilar, 334 S.W.3d at 50. We ex-amine the document as a whole in light ofthe circumstances present when it waswritten. Corcoran, 2013 WL 5888127, at*2. If the bylaw or article is written so thatit can be given a definite interpretation, itis not ambiguous and the court will con-strue it as a matter of law. See Aguilar,334 S.W.3d at 50.
Appellees refer us to Chen v. Tseng, No.01-02-01005-CV, 2004 WL 35989, at *6(Tex. App.—Houston [1st Dist.] Jan. 8,2004, no pet.) (mem. op.), a corporationcase, to support their argument that ‘‘[i]t iseasy to separate ecclesiastical and proper-ty disputes in most cases.’’ The TEC par-ties respond that the First court subse-quently held that case irrelevant under thecircumstances presented here, citing Grea-
nias v. Isaiah, No. 01-04-00786-CV, 2006WL 1550009, at *9 (Tex. App.—Houston[1st Dist.] June 8, 2006, no pet.) (mem.op.).
In Chen, the First court, citing ouropinion in Dean, 994 S.W.2d at 395, not-ed—as set out above—that civil courtshave jurisdiction over matters involvingchurches and their civil, contract, andproperty rights as long as neutral princi-ples of law may be applied to decide theissues. 2004 WL 35989, at *6. The mem-bership of a religious group had formed acorporation to build a temple; the corpora-tion’s bylaws set out the requirements foran annual meeting of the membership toelect directors, the length of their terms,how vacancies would be filled, and thedate of the annual meeting. Id. at *1. Inconducting corporate affairs, the directorsfrequently consulted with the religion’s pa-triarch and generally followed his instruc-tions. Id. at *2. After he died, a disputearose with regard to the composition ofthe corporation’s board. Id. at *2–3.
Chen, who had served as the patriarch’sassistant and who subsequently attemptedto reorganize the corporation outside theparameters of the corporation’s bylaws,conceded that the trial court applied neu-tral principles of law in interpreting andapplying the bylaws. Id. at *2, *6. After afour-day bench trial, the trial court ‘‘mere-ly applied the bylaws to make a determina-tion of the validity of the selection of di-rectors of the [c]orporation.’’ Id. at *3, *6.While the corporation’s board controlledthe corporation’s membership, it did notcontrol membership in the religious group.Id. at *6.
In Greanias, the court considered a pleato the jurisdiction brought in a suit to
79. Depending on a nonprofit corporation’sfederal tax qualification, the nonprofit corpo-ration may also serve as the trustee of a trust.
Tex. Bus. Orgs. Code Ann. § 2.106(a) (West2012).
417Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
determine the rightful board of trustees(parish council) of the Annunciation GreekOrthodox Cathedral, organized as a Texasnonprofit corporation, after the hierarch ofthe regional division of the Greek Ortho-dox Archdiocese of America removed someof the trustees (10 of 15 total, elected tothree-year, staggered terms, from 2000–2002) from office. 2006 WL 1550009, at *1.Prior to the trustees’ removal from theboard, the Cathedral had adopted its ownbylaws rather than the Archdiocese’s uni-form parish regulations. Id.
Internal strife occurred in 2001, with theappointment by the hierarch of a priestwith whom the subsequently removedboard members did not get along. Id. at*2–3 (recounting that the board membershad the priest followed by a private inves-tigator and twice notified the IRS abouthis personal finances). In 2002, the hier-arch refused to ratify the purported elec-tion of new board members because thepriest had refused to sign the electionresults, as required by the local bylaws. Id.at *2. The board members also ignored thehierarch’s request that they amend thelocal bylaws to conform to the archdio-cese’s uniform parish regulations. Id. at *1.In 2003, the hierarch demanded that boardmembers with uncompleted terms submittheir resignations. Id. at *2. When onlythree did so, he rescinded his ratificationof the remaining original board members’elections. Id. at *2–3 (quoting the hier-arch’s statement that ‘‘[i]t does not take arocket scientist to see that there is noworking cooperation between the spiritualhead of the parish and those who took theoath to assist him in his work’’). The hier-arch and the local priest organized an in-terim council, which elected officers andassumed control of the Cathedral—actionsthat ultimately led to a lawsuit seeking adeclaratory judgment that the corpora-tion’s bylaws were the controlling docu-ment governing the Cathedral’s affairs. Id.
at *3. The trial court granted the hier-arch’s plea to the jurisdiction. Id. at *4.
On appeal, the board members com-plained that under the local bylaws, thehierarch lacked the power to dismiss themand to create an interim council and thatonly they—as the original parish council—had the right to serve and act on theCathedral’s behalf. Id. The court recitedthe neutral-principles template before not-ing that ‘‘if an issue—even one that isclaimed to be based solely on neutral prin-ciples of law—cannot be decided withoutdetermining prohibited religious matters,the court must defer to the ecclesiasticalauthority’s resolution of that issue.’’ Id. at*5. Accordingly, the court had to examinethe substance and effect of the plaintiff’spetition, without considering the technicalclaims asserted, to determine the suit’secclesiastical implications. Id.
The Cathedral’s bylaws set out a corpo-rate purpose that included maintaining,conducting, and operating ‘‘a church inconformity with the doctrine, canons, wor-ship, discipline, usages and customs of theGreek Orthodox Church,’’ and requiredthat candidates for parish council be mem-bers of the Cathedral in good standing forat least a year before the election. Id. at*7. To be in good standing, the memberwas required to, among other things, live‘‘according to the faith and canons of the[Greek Orthodox] Church.’’ Id. The bylawsalso required newly elected parish councilmembers to have their election ratified bythe hierarch and to be administered theoath of office by the parish priest. Id. Andthey required the parish council to conductthe Cathedral’s secular business ‘‘in fur-therance of the aims and purposes of the[Greek Orthodox] Church and in accor-dance with TTT the constitution, canons,discipline, and regulations of the Archdio-cese,’’ and to refer all spiritual questions tothe hierarch. Id.
418 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
Although the board members arguedthat the controversy involved a simple de-termination of which bylaws applied andthe application of the nonprofit corporationact’s provisions to the corporate organiza-tion, the First court observed that ‘‘[t]hecontroversy inherently and inextricably in-volves a presiding hierarch’s power to dis-cipline a local parish council; his power todetermine whether that council’s membershave violated their oath to obey thechurch’s hierarchy, discipline, and canons;and an archdiocese’s right to insist on whatby-laws may be adopted by its subordinateparishes,’’ all of which constituted ecclesi-astical matters inextricably intertwinedwith the board members’ request for adeclaration that the local bylaws con-trolled. Id. at *7–8. And such inextricableintertwining prevented the court from re-solving the dispute on purely neutral prin-ciples. Id. at *8.
Specifically, in affirming the trial court’sjudgment granting the plea to the jurisdic-tion, the court observed that there was aquestion as to whether the local bylaws orthe uniform parish regulations controlledwhen the uniform regulations providedthat the mere assignment of a parishpriest would bind the parish to the regula-tions—‘‘[t]hose matters are at the heart ofthis dispute, and they are inextricably in-tertwined with ecclesiastical issues ofchurch governance, polity, and doctrinethat we may not determine.’’ Id. The courtdistinguished Chen in part based on thelack of a preserved challenge in that caseconcerning which bylaws applied and whatthey required, pointing out that the Chendispute had only involved whether variouselections and appointments had been law-ful under those bylaws. Id. at *9. Thecourt observed that Chen did not involve asituation ‘‘in which a higher authority, ex-ternal of the local congregation, was dis-puting what the document governing thelocal congregation was’’ and that the evi-
dence in Chen showed that membership inthe religious corporation was not co-exten-sive with membership in the religion. Id.
[31] Chen and Greanias were both de-cided before the supreme court fleshed outthe neutral principles analysis in EpiscopalDiocese and Masterson but, to some ex-tent, they represent the range of religiouscorporation cases, from the most neutral—was there compliance with the bylaws?—tothe most inextricably intertwined—whichbylaws apply and do they involve a reli-gious test or religious governance? Whenwe review the Corporation’s bylaws in ouranalysis below, we will consider thesequestions to determine where the case be-fore us rests on that spectrum. See Mou-ton v. Christian Faith Missionary BaptistChurch, 498 S.W.3d 143, 150 (Tex. App.—Houston [1st Dist.] 2016, no pet.) (conclud-ing that Masterson did not alter the princi-ple for which Westbrook stands: courtsmay apply neutral principles of law incases involving religious entities only ifdoing so does not implicate inherently ec-clesiastical concerns). Whether neutralprinciples may be applied to a claim turnson the substance of the issues it raises. Id.
(3) Trust Law
[32, 33] In addition to the questions ofassociation and corporate control, at issueis whether the property claimed by bothparties is held in trust and if so, for whom.See Perfect Union Lodge No. 10, A.F. &A.M., of San Antonio v. Interfirst Bank ofSan Antonio, N.A., 748 S.W.2d 218, 220(Tex. 1988) (‘‘It is well established that thelegal and equitable estates must be sepa-rated; the former being vested in the trus-tee and the latter in the beneficiary. Thisseparation of legal and equitable estates inthe trust property is the basic hallmark ofthe trust entity.’’ (citations omitted)); seealso Tex. Prop. Code Ann. § 111.004(4)
419Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
(West 2014) (stating that an express trust‘‘means a fiduciary relationship with re-spect to property which arises as a man-ifestation by the settlor of an intention tocreate the relationship and which subjectsthe person holding title to the property toequitable duties to deal with the propertyfor the benefit of another person’’). Whenan express trust fails, the law implies aresulting trust with the beneficial titlevested in the settlor, to prevent unjustenrichment. Pickelner v. Adler, 229 S.W.3d516, 526–27 (Tex. App.—Houston [1stDist.] 2007, pet. denied).80
(a) Law of Situs
[34] Texas law governs the transfer ofTexas land. Welch v. Trs. of Robert A.Welch Found., 465 S.W.2d 195, 198, 200(Tex. Civ. App.—Houston [1st Dist.] 1971,writ ref’d n.r.e.) (op. on reh’g) (stating that‘‘[t]he general rule that the law of the statein which real estate is situated governs itsdescent, alienation, and transfer is notquestioned,’’ and that ‘‘the law of this statecontrols and governs the transmission bywill of real estate located therein and theconstruction and effect of all instrumentsintended to convey such real estate’’); seeToledo Soc’y for Crippled Children v.Hickok, 152 Tex. 578, 261 S.W.2d 692, 694,697 (1953) (‘‘[T]he law of the situs governsthe matter of testamentary or intestatesuccession to land.’’), cert. denied, 347 U.S.936, 74 S.Ct. 631, 98 L.Ed. 1086 (1954).
(b) Standard of Review
[35, 36] The construction of a trust in-strument is a question of law for the court.
Eckels v. Davis, 111 S.W.3d 687, 694 (Tex.App.—Fort Worth 2003, pet. denied). Welook to the law that was in effect at thetime that the trust became effective. SeeCarpenter v. Carpenter, No. 02-10-00243-CV, 2011 WL 5118802, at *3 (Tex. App.—Fort Worth Oct. 27, 2011, pet. denied)(mem. op.); see also Act of May 26, 1983,68th Leg., R.S., ch. 576, § 7, 1983 Tex.Gen. Laws 3475, 3730 (stating that the1984 Act was intended only as a recodifica-tion and that no substantive change wasintended); Perfect Union Lodge No. 10,748 S.W.2d at 220 (stating that the newtrust code provides that the Texas TrustAct, which was repealed in 1984, will gov-ern the creation of trusts entered intowhile the Act was in effect); Cutrer v.Cutrer, 162 Tex. 166, 345 S.W.2d 513, 519(1961) (‘‘It would be quite strange to ascer-tain th[e settlor’s] intention by looking tothe provisions of statutes enacted after thetrust instruments became effective or con-sidering changes in public policy as re-flected thereby.’’). Accordingly, we reviewour trust statutes and case law for thedefining characteristics of trusts.
[37–39] Trust statutes were ‘‘framed tosupplement rather than to supplant thedesires of a trustor.’’ St. Marks EpiscopalChurch, Mt. Pleasant, Tex. v. Lowry, 271S.W.2d 681, 684 (Tex. Civ. App.—FortWorth 1954, writ ref’d n.r.e.). Thus, welook to the words of the instrument first,seeking to uphold rather than destroy atrust, and then turn to statutory provisionsto fill in any gaps. See id. at 684–85 (con-struing will to determine deceased’s intentwith regard to trust income); see also Run-
80. If fraud is involved, a constructive trust—an equitable remedy implied by operation oflaw to prevent unjust enrichment—may beimposed, under the theory that equitable titleshould be recognized in someone other thanthe holder of legal title. Pickelner, 229 S.W.3dat 527; see also Kinsel v. Lindsey, 526 S.W.3d411, 426 (Tex. 2017) (noting that the specific
instances in which equity may impress a con-structive trust are as numberless as the modesby which property may be obtained throughbad faith and unconscientious acts); KCM Fin.LLC v. Bradshaw, 457 S.W.3d 70, 87 (Tex.2015) (observing that constructive trusts havehistorically been applied to ameliorate harmarising from a wide variety of misfeasance).
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yan v. Mullins, 864 S.W.2d 785, 789 (Tex.App.—Fort Worth 1993, writ denied)(‘‘[W]hen the terms of a trust set out aspecific method or manner in which toamend the trust, the Texas Trust Codeindicates that those terms are controllingand must be followed.’’); Commercial Nat’lBank in Nacogdoches v. Hayter, 473S.W.2d 561, 565 (Tex. Civ. App.—Tyler1971, writ ref’d n.r.e.) (‘‘Since the Testatordid not choose to direct the manner ofapportionment, it would seem to followthat he intended the Texas Trust Act togovern.’’); see generally Tex. Prop. CodeAnn. § 111.002 (West 2014) (‘‘This subtitleand the Texas Trust Act, as amended TTT
shall be considered one continuous statute,and for the purposes of any statute or ofany instrument creating a trust that refersto the Texas Trust Act, this subtitle shallbe considered an amendment to the TexasTrust Act.’’), § 111.0035(b) (West Supp.2017) (stating that the trust’s terms prevailover statutory provisions except as to
items such as illegal purposes, exculpationfor breaches of trust, limitations periods,and a court’s jurisdiction to take certainactions, including modifying or terminatinga trust or removing a trustee).81 But ‘‘un-der general rules of construction[,] weavoid strictly construing an instrument’slanguage if it would lead to absurd re-sults.’’ Hemyari v. Stephens, 355 S.W.3d623, 626–27 (Tex. 2011).
(c) Trust Formation
[40–43] ‘‘We look to the settlor’s intentto determine whether a trust was created.’’Hubbard v. Shankle, 138 S.W.3d 474, 484(Tex. App.—Fort Worth 2004, pet. denied).‘‘The intent of the settlor must be ascer-tained from the language used within thefour corners of the instrument,’’ and wemust harmonize all terms to properly giveeffect to all parts of the trust instrumentand construe it to give effect to all provi-sions so that none is rendered meaning-less.82 Eckels, 111 S.W.3d at 694.
81. Section 111.0035 was added in 2005 andbecame effective January 1, 2006. See Act ofMay 12, 2005, 79th Leg., R.S., ch. 148, §§ 2,32, 2005 Tex. Gen. Laws 287, 287–88, 296,amended by Act of May 11, 2007, 80th Leg.,R.S., ch. 451, § 2, 2007 Tex. Gen. Laws 801,801–02, amended by Act of May 21, 2009, 81stLeg., R.S., ch. 414, § 2, 2009 Tex. Gen. Laws995, 995, and amended by Act of May 9, 2017,85th Leg., R.S., ch. 62, § 1, 2017 Tex. Sess.Law Serv. 135, 135 (West). For trusts existingon January 1, 2006, that were created beforethat date, the 2005 changes apply only to anact or omission relating to the trust that oc-curred on or after January 1, 2006. Act ofMay 12, 2005, 79th Leg., R.S., ch. 148,§ 31(b), 2005 Tex. Gen. Laws at 296.
82. Although a settlor’s manifestation of intentto create a trust was not an express statutoryrequirement until the legislature’s replace-ment of the Texas Trust Act with the TexasTrust Code in 1983 (effective January 1,1984), see Act of May 24, 1983, 68th Leg.,R.S., ch. 576, art. 2, § 2, 1983 Tex. Gen. Lawsat 3654–3731 (current version at Tex. Prop.Code Ann. §§ 111.001–117.012 (West 2014 &Supp. 2017)), the requirement that the settlor
clearly express the intention to create a trusthad already long been embedded in our caselaw. See Mills v. Gray, 147 Tex. 33, 210S.W.2d 985, 987 (1948) (quoting 54 Am. Jur.22, sec. 5, for the proposition that a trust‘‘intentional in fact’’—i.e., one in which the‘‘execution of an intention’’ occurs—is an ex-press trust); see also Omohundro v. Matthews,161 Tex. 367, 341 S.W.2d 401, 405 (1960)(stating that an express trust arises because ofa manifestation of intention to create it); Fitz–Gerald v. Hull, 150 Tex. 39, 237 S.W.2d 256,260 (1951) (‘‘[W]e believe that the Texas caseshold that an express trust ‘can come intoexistence only by the execution of an intentionto create it by the one having legal and equi-table dominion over the property made sub-ject to it.’ ’’ (quoting Mills, 210 S.W.2d at987)). The 1983 Texas Trust Code repeatedthe requirement that a settlor could revoke atrust ‘‘unless it is irrevocable by the expressterms of the instrument creating it or of aninstrument modifying it.’’ See Act of May 24,1983, 68th Leg., R.S., ch. 576, art. 2, § 2,1983 Tex. Gen. Laws at 3659 (current versionat Tex. Prop. Code Ann. § 112.051); see alsoAyers v. Mitchell, 167 S.W.3d 924, 931 (Tex.
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[44–46] There are no particular wordsrequired to create a trust if there existsreasonable certainty as to the intendedproperty, the subject to which the trustobligation relates, and the beneficiary,Hubbard, 138 S.W.3d at 483–84, but ‘‘[t]ocreate a trust by a written instrument,the beneficiary, the res, and the trustpurpose must be identified.’’ Perfect Un-ion Lodge No. 10, 748 S.W.2d at 220 (con-struing trust created by will); Alpert v.Riley, 274 S.W.3d 277, 286 (Tex. App.—Houston [1st Dist.] 2008, pet. denied) (op.on reh’g) (‘‘[T]he person intended to bethe beneficiary must be certain.’’); seeTex. Prop. Code Ann. § 112.001(1) (stat-ing that a trust may be created by aproperty owner’s declaration that theowner holds the property as trustee foranother person). The mere designation ofa party as ‘‘trustee’’ does not create atrust. Nolana Dev. Ass’n v. Corsi, 682S.W.2d 246, 249 (Tex. 1984). If the trust’slanguage is unambiguous and clearly ex-presses the settlor’s intent, it is unneces-sary to construe the instrument becauseit speaks for itself. Eckels, 111 S.W.3d at694.
[47, 48] A trust in real property is en-forceable only if there is written evidenceof the trust’s terms bearing the signatureof the settlor or the settlor’s authorizedagent. See Tex. Prop. Code Ann.§ 112.004; Act of April 15, 1943, 48th Leg.,R.S., ch. 148, § 7, 1943 Tex. Gen. Laws232, 234, repealed by Act of May 24, 1983,68th Leg., R.S., ch. 576, §§ 6, 8, 1983 Tex.Gen. Laws at 3729–30 (rev. civ. stat. art.7425b-7). And an entity cannot unilaterallyname itself as the beneficiary of a trustinvolving another entity’s property. SeeBest Inv. Co. v. Hernandez, 479 S.W.2d759, 763 (Tex. Civ. App.—Dallas 1972, writ
ref’d n.r.e.) (reciting the requirement of awritten instrument for a real propertytrust and that ‘‘[d]eclarations of the pur-ported beneficiary of the trust are notcompetent to establish the trust’’). Sowhile a person can establish a trust for hisor her own benefit, he or she must own theproperty that is transferred in order tocreate the trust. See Lipsey v. Lipsey, 983S.W.2d 345, 351 n.7 (Tex. App.—FortWorth 1998, no pet.) (citing Tex. Prop.Code Ann. § 112.001); see also Elbert v.Waples-Platter Co., 156 S.W.2d 146, 152(Tex. Civ. App.—Fort Worth 1941, writref’d w.o.m.) (citing Wise v. Haynes, 103S.W.2d 477, 483 (Tex. Civ. App.—Texar-kana 1937, no writ), for the propositionthat the declarations of a beneficiary arenot competent to establish a trust).
(d) Trust Statutes
In 1943, the legislature enacted the Tex-as Trust Act to govern express trusts. SeeAct of Apr. 15, 1943, 48th Leg., R.S., ch.148, § 48, 1943 Tex. Gen. Laws 232, 232–47 (effective as of April 19, 1943, as revisedcivil statute articles 7425b-1–b-47); see alsoTex. Prop. Code Ann. § 111.003 (statingthat trust statutes do not govern resulting,constructive, or business trusts or securityinstruments). Under the 1943 Act, a trust‘‘in relation to or consisting of real proper-ty’’ was invalid unless created, established,or declared by a written instrument ‘‘sub-scribed by the trustor or by his agent’’ orby any other instrument under which thetrustee claimed the affected estate. Act ofApr. 15, 1943, 48th Leg., ch. 148, § 7, 1943Tex. Gen. Laws at 234. And ‘‘[e]very trustshall be revocable by the trustor duringhis lifetime, unless expressly made irrevo-cable by the terms of the instrument creat-ing the same or by a supplement or
App.—Texarkana 2005, no pet.) (observingthat when there is only one settlor and he orshe dies, the trust becomes irrevocable but
that when one of multiple settlors dies andthere are purposes of the trust yet unfulfilled,the trust does not become irrevocable).
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amendment thereto.’’ Id. § 41, 1943 Tex.Gen. Laws at 246.83
The 1945 amendments to the TexasTrust Act did not affect the above provi-sions. See generally Act of Apr. 5, 1945,49th Leg., R.S., ch. 77, 1945 Tex. Gen.Laws 109, 109–14. Likewise, although theDennis Canon—one of the trust provisionsto which we are referred—was added byTEC to its canons in September 1979, theabove provisions were not substantiallymodified during the intervening decades.See Tex. Rev. Civ. Stat. Arts. 7425b-2, b-7,b-41, Texas Historical Statutes Project,West’s Texas Statutes 1979 Supp. vol. 2,https://www.sll.texas.gov/assets/pdf/historical-statutes/1979-2/1979-2-supplement-to1974-wests-texas-statutes-and-codes.pdf; id., West’s Texas Statutes1974, vol. 5, https://www.sll.texas.gov/assets/pdf/historical-statutes/1974-5/1974-5wests-texas-statutes-and-codes.pdf.
(e) Trespass to Try Title andAdverse Possession
The TEC parties brought a trespass-to-try-title claim, while Appellees argued, tothe contrary, that they adversely pos-sessed any interest that might otherwiseexist for the TEC parties.
[49, 50] An action of trespass to trytitle may be brought on an equitable title.Longoria v. Lasater, 292 S.W.3d 156, 165(Tex. App.—San Antonio 2009, pet. denied)(op. on reh’g) (‘‘A suit to resolve a disputeover title to land is, in effect, a trespass totry title action regardless of the form theaction takes and whether legal or equitablerelief is sought.’’). An owner of a superiorequitable title may recover in a trespass-to-try-title action if the record shows theequitable title is superior to the defen-
dant’s bare legal title. Id. (citing Binford v.Snyder, 144 Tex. 134, 189 S.W.2d 471, 474(1945)). And, of course, here we must lookto any subsequent arrangements—such asthe 1984 consent judgment—to determinewhether any equitable interests were mod-ified. See, e.g., Allstate Ins. Co. v. Clarke,471 S.W.2d 901, 907–08 (Tex. Civ. App.—Houston [1st Dist.] 1971, writ ref’d n.r.e.)(considering whether earlier trust agree-ment was superseded by a subsequent onebased on the clear intention of the parties).
[51, 52] The plaintiff in a trespass-to-try-title suit must recover on the strengthof his own title and not on the weakness ofthe defendant’s title. Bellaire KirkpatrickJoint Venture v. Loots, 826 S.W.2d 205,209 (Tex. App.—Fort Worth 1992, writdenied) (citing Adams v. Rowles, 149 Tex.52, 228 S.W.2d 849, 853 (1950)). When titleis controverted, the defendant admits pos-session of the subject property but claimsbetter title, and the burden of proof is onthe plaintiff to establish a superior title inhimself by an affirmative showing. Id.
[53] When a trustee’s legal title is ad-versely possessed, the equitable interestgoes with it. See Capps v. Gibbs, No. 10-12-00294-CV, 2013 WL 1701772, at *7 (Tex.App.—Waco Apr. 18, 2013, pet. denied)(mem. op.) (concluding legal and equitabletitle obtained by adverse possession);Broussard Tr. v. Perryman, 134 S.W.2d308, 313 (Tex. Civ. App.—Beaumont 1939,writ ref’d) (stating that ‘‘when the bar ofthe statute is complete against the legaltitle vested in the trustee, it applies also tothe equitable title of the cestui que trust’’).
[54, 55] The applicable adverse posses-sion standard depends on whether the
83. Prior to April 19, 1943, trusts in Texaswere considered irrevocable unless an ex-pressed power of revocation was reserved inthe trust’s terms. See Citizens Nat’l Bank of
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person claiming to have adversely pos-sessed the interest is a stranger or a co-tenant. See Rife v. Kerr, 513 S.W.3d 601,616 (Tex. App.—San Antonio 2016, pet.denied). For example, ‘‘[c]otenants mustsurmount a more stringent requirementbecause acts of ownership ‘which, if doneby a stranger, would per se be a disseizin,’are not necessarily such when cotenantsshare an undivided interest.’’ BP Am.Prod. Co. v. Marshall, 342 S.W.3d 59, 70(Tex. 2011) (quoting Todd v. Bruner, 365S.W.2d 155, 160 (Tex. 1963)). Under suchcircumstances, the proponent must proveouster—unequivocal, unmistakable, andhostile acts the possessor took to disseizethe other cotenants. Id.
2. Ownership of Equitable Title
In response to the TEC parties’ issues,Appellees assert that they hold both legaland beneficial title and are the Corpora-tion’s and EDFW’s rightful officers. Theyargue that the TEC parties’ case is basedon revoked trusts, superseded deeds, re-pealed bylaws, and oral statements andthat the TEC parties’ ‘‘scattershot defens-es don’t annul neutral principles’’ becausethis is not an ecclesiastical dispute. Theyurge that associations are governed byneutral principles and that a Fort Worthcase (Shellberg) from almost 50 years agois no basis for defying the supreme court’smandate.
As previously stated, no one disputesthat the Corporation holds legal title to thevarious items of property at issue. SeeHouston First Am. Sav. v. Musick, 650S.W.2d 764, 767 (Tex. 1983) (‘‘Assertions offact, not pled in the alternative, in the livepleadings of a party are regarded as for-mal judicial admissions.’’). The crux of theparties’ dispute, however, is ownership ofequitable title. We therefore turn, as di-rected by the supreme court, to the appli-cation of our state law on trusts, corpora-tions, and associations to the deeds and the
various entities’ formative documents, todetermine the property ownership issuebefore us.
a. Trust Law Application
The TEC parties argue that the DennisCanon sets forth an enforceable, irrevoca-ble trust for TEC under Texas trust law,as well as under Jones v. Wolf irrespectiveof state law requirements, and under thiscourt’s Shellberg opinion as a contractualtrust. They further argue that even if atrust was not established for TEC in theDennis Canon, the deeds of various prop-erties set forth trusts for EDFW or thecongregations.
(1) Dennis Canon
[56] Although the TEC parties ‘‘con-tend that the Dennis Canon is enforceableunder Texas trust law,’’ we disagree.
The Dennis Canon was adopted in 1979and purports to impose a trust for TECand TEC’s diocese on parish, mission, andcongregation real and personal property,stating,
All real and personal property held byor for the benefit of any Parish, Missionor Congregation is held in trust for thisChurch and the Diocese thereof in whichsuch Parish, Mission o[r] Congregationis located. The existence of this trust,however, shall in no way limit the powerand authority of the Parish, Mission orCongregation otherwise existing oversuch property so long as the particularParish, Mission or Congregation re-mains a part of, and subject to, thisChurch and its Constitution and Canons.
The section that follows essentially pro-vides that no other action need be takenfor the trust to be enforceable but thatdioceses can take additional action, stating,
The several Dioceses may, at their elec-tion, further confirm the trust declared
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under the foregoing Section 4 by appro-priate action, but no such action shall benecessary for the existence and validityof the trust.
[57] But Texas law requires a writingsigned by the settlor or the settlor’s agentto create a trust with regard to real prop-erty. See Tex. Prop. Code Ann. § 112.004;Act of Apr. 15, 1943, 48th Leg., R.S., ch.148, § 7, 1943 Tex. Gen. Laws at 234,repealed by Act of May 24, 1983, 68thLeg., R.S., ch. 576, §§ 6, 8, 1983 Tex. Gen.Laws at 3729–30 (rev. civ. stat. art. 7425b-7). As stated above, a proposed beneficiarycannot unilaterally name itself as the bene-ficiary of a trust involving another entity’sproperty. See Lipsey, 983 S.W.2d at 351n.7; Best Inv. Co., 479 S.W.2d at 763; seealso Tex. Prop. Code Ann. § 111.004(14)(defining ‘‘settlor’’ as a person who createsa trust or contributes property to a trusteeof a trust; ‘‘settlor’’ means the same as‘‘grantor’’ and ‘‘trustor’’), § 112.001 (defin-ing the methods of creating a trust:through a property owner’s declaration,intervivos transfer, or testamentary trans-fer, through the power of appointment toanother person as trustee for the donee ofthe power or for a third person, or througha promise to another person whose rightsunder the promise are to be held in trustfor a third person), § 112.005 (‘‘A trustcannot be created unless there is trustproperty.’’); McConnell & Goodrich, 58Ariz. L. Rev. at 322, 335 (reasoning that
‘‘[d]enominations cannot create a trust infavor of themselves in property they didnot previously own’’ and that ‘‘[c]hurchescan adopt any internal rules they wish, butthose rules do not have legal force unlessthey are embodied in the forms requiredby state law’’). Because under Texas law,an entity that does not own the property tobe held in trust cannot establish a trust foritself simply by decreeing that it is thebeneficiary of a trust,84 the Dennis Canon,by itself, did not establish a trust underTexas law,85 and we overrule this portionof the TEC parties’ argument.
(2) Application of Jones v. Wolf
[58] The TEC parties also argue thatregardless of the content of our state lawrequirements, a trust is enforceable byvirtue of the Dennis Canon, contendingthat Jones requires the enforcement ofexpress trusts recited in governing churchdocuments irrespective of state law. But inJones, the Court merely referenced theneed for ‘‘some legally cognizable form.’’443 U.S. at 603–04, 606, 99 S.Ct. at 3025–26, 3027. And our supreme court has al-ready stated, ‘‘We do not read Jones aspurporting to establish substantive proper-ty and trust law that state courts mustapply to church property disputes.’’ Mas-terson, 422 S.W.3d at 612. That is, in Tex-as, the required legally cognizable form isthe one provided by our statutes and caselaw.86 We overrule this portion of the TEC
84. See also Gerstenblith, 39 Am. U. L. Rev. at566 (explaining that implied trusts serve toobfuscate land titles and may discourage pro-ductive use of the land because ‘‘any invest-ment in the property would be lost if the localentity chose to disaffiliate’’).
85. In Masterson, the supreme court did notdetermine whether the Dennis Canon im-posed a trust but stated that even assumingthat it had created one, its terms did not makeit expressly irrevocable. 422 S.W.3d at 613.Based on our resolution here, we do not
reach the question of irrevocability with re-gard to the Dennis Canon.
86. The Supreme Court of Tennessee recentlyreviewed the two schools of thought that in-terpret what the Court meant by its ‘‘legallycognizable form’’ phraseology, characterizingthem as the ‘‘Strict Neutral-Principles Ap-proach’’ and the ‘‘Hybrid Neutral-PrinciplesApproach.’’ See Church of God in Christ, Inc.v. L.M. Haley Ministries, Inc., 531 S.W.3d146, 168 (Tenn. 2017) (observing that mostneutral-principles-related litigation has arisen
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parties’ argument. Having concluded thata trust—revocable or not—was not im-posed for TEC through the Dennis Canon,we do not reach the TEC parties’ Shell-berg argument. See Tex. R. App. P. 47.1.
(3) Other Trusts
The TEC parties complain about themisallocation of 55 properties that containwhat they describe as express trusts infavor of TEC, EDFW, and the congrega-tions, ‘‘with similar language’’ to the fol-lowing set out in their brief:
This Conveyance, however, is in trustfor the use and benefit of the Protestant
Episcopal Church, within the territoriallimits of what is now known as the saidDiocese of Dallas, in the State of Tex-asTTTT
But in their brief, they point to only onedeed of dubious legibility appearing in therecord to support this assertion.87 Addi-tionally, the TEC parties fail to inform usas to the degree of similarity they contendthis one deed bears to the 54 others.Therefore, in our analysis and applicationof the law, we will consider only the lan-guage of (1) this deed, as discussed by theTEC parties in their brief, which is to one
‘‘where a hierarchical religious organizationincludes a provision in its constitution and/orother governing documents providing that lo-cal church property is held in trust for thehierarchical organization and a local churchfails or declines to include the trust provisionin deeds or other documents of conveyance’’).The Tennessee court described the strict ap-proach as only giving effect to provisions inchurch constitutions and governing docu-ments of hierarchical religious organizations‘‘if the provisions appear in civil legal docu-ments or satisfy the civil law requirementsand formalities for imposition of a trust.’’ Id.(citing McConnell & Goodrich, 58 Ariz. L.Rev. at 324–25, defining strict approach’sconstruction of ‘‘legally cognizable form’’ ascomplying with the formalities of property,trust, or contract law). The court describedthe hybrid approach—which the majority ofstates addressing the issue have followed—asdeferring to and enforcing trust language con-tained in the constitutions and governing doc-uments even if the language would not satisfythe civil law formalities normally required tocreate a trust but recognized that Texas hasadopted the strict approach. Id. (citing Mas-terson, 422 S.W.3d at 611–12).
87. In their brief, the TEC parties do refer usto ‘‘Table E—‘In Trust for The EpiscopalChurch’ ’’ appearing on 23 pages in volume30 of the clerk’s record. The footnote to TableE states that it covers ‘‘Episcopal Propertyheld in trust for The Episcopal Church, heldin trust for The Episcopal Church and itsConstituent Diocese, held in trust for a Con-gregation, and/or held outright by a Congre-gation or a related entity but is not limited to
the properties listed in Table E.’’ While TableE contains references to the Bates numbers ofthe joint appendix created by the parties dur-ing the summary judgment phase in whichthe deeds themselves can be found, it does notrecite the trust language at issue for any ofthe deeds listed therein. Rather, it containsthe legal description of each property.
Appellees argue in this appeal that 35 deedsthat ‘‘placed title in the bishop of Dallas ‘forthe use and benefit of the Protestant Episco-pal Church, within the territorial limits ofwhat is now known as the said Diocese ofDallas, in the State of Texas,’ ’’ imposed atrust for the Diocese of Dallas, not TEC, andthat EDFW and its congregations ‘‘inheritedall those rights upon division’’ in the 1984judgment. They refer us to a chart in one ofthe supplemental volumes of the clerk’s rec-ord that identifies various deeds in the jointappendix. The chart contains property de-scriptions, identifies the grantee of each deed,and contains Appellees’ opinion of whether atrust is stated in each deed, along with theirstatement of which church uses the property.
We decline the parties’ invitation to parsethrough this voluminous record on their be-half to confirm that the conveyance instru-ments for 35–55 properties contain ‘‘similarlanguage’’ and do or do not create trusts. SeeRogers v. Ricane Enters., Inc., 772 S.W.2d 76,81 (Tex. 1989) (‘‘[A] general reference to avoluminous record which does not direct thetrial court and parties to the evidence onwhich the movant relies is insufficient.’’). Inlight of our disposition below, the parties willhave the opportunity to sort out and presentthese arguments to the trial court on remand.
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of the properties claimed by All Saints; (2)the other All Saints deed, also discussedby the TEC parties in their brief; and (3)any other documents related to these twodeeds.
(a) Deeds, Judgment, andTrust Language
(i) 1947 Warranty Deed
The snippet of language that the TECparties claim is similar to 54 other proper-ties is contained in a 1947 warranty deedtransferring ‘‘[a]ll of Block 14, Chamber-lain Arlington Heights’’ 88 from John P.King and J. Roby Penn to Charles AveryMason, as Bishop of the Protestant Epis-copal Church for the Diocese of Dallas, hissuccessors, and assigns, ‘‘for and in consid-eration of the sum of’’ $5,000. This deedstates, in pertinent part,
TO HAVE AND TO HOLD, all andsingular the above described premisesuntil the said CHARLES AVERY MA-SON, as aforesaid, his successors in saidoffice of Bishop aforesaid and his andtheir assigns forever, upon condition andin trust, however, for the purposes de-clared and set forth.
TTTT
It being expressly agreed between thegrantors aforesaid and the granteeaforesaid, and binding upon his succes-sors in office and assigns, that the abovedescribed land shall be used only for thebuilding site of a church and/or for theerection of buildings appertaining to achurch, subject however to the followingconditionsTTTT
TTTT
This Conveyance, however, is in trustfor the use and benefit of the Protestant
Episcopal Church, within the territoriallimits of what[ ] is now known as theDiocese of Dallas, in the State of Texas,and for this purpose the saidCHARLES AVERY MASON, as afore-said, and his successors in office, shallhold, use, improve, manage and controlthe above described property in suchmanner as to him or them, may seembest for the interest of said Church with-in said Diocese. And the saidCHARLES AVERY MASON, as afore-said, and his successors in office, shallhave, and by these presents, do have,the right, power, and authority, whenev-er it may to him or them seem best forthe interest of said Church within saidDiocese so to do, lease, mortgage, selland otherwise encumber or dispose ofthe aforesaid premises, upon such terms,for such prices and in such manner as tohim or them may seem best. And forthis purpose he or they may make, exe-cute and deliver all such leases, mort-gages, deeds of trust, deeds and otherwritten instruments, as the circum-stances of the case may render neces-sary and expedient. But neither the saidCHARLES AVERY MASON nor anyone else shall ever have any right, poweror authority during the continuance ofthis trust to in anywise encumber orcreate a lien upon or any liability againstthe above described premises except byan instrument in writing expressly giv-ing a lien upon said premises, and dulysigned and acknowledged by the saidCHARLES AVERY MASON, as afore-said, or by some one of his successors insaid office of Bishop.[89]
And in the event of death, resigna-tion, suspension, deposition or removal
88. This corresponds to the All Saints propertyat 5001 Crestline (sanctuary).
89. See, e.g., McConnell & Goodrich, 58 Ariz.L. Rev. at 342–43 (‘‘Placing title in a denomi-national official ensures that the property willalways remain within the denomination.’’).
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from office for any cause of any Bishopin whom may at the time of such death,resignation, suspension, deposition orother removal from office, be vested thetitle to the above described premises, astrustee under this instrument, then, andin that event, the senior Bishop of theProtestant Episcopal Church in theUnited States of America shall be heldand deemed to be, for the purpose ofsustaining and p[e]rp[e]tuating thistrust, the successor in office of saidBishop, until vacancy shall have beenregularly filled; provided, however, thatsaid senior Bishop of the ProtestantEpiscopal Church in the United Statesof America shall have no power whilethus temporarily holding the title astrustee to the above described propertyto sell, mortgage, lease or in any man-ner encumber or dispose of said proper-ty. [Emphasis added.]
(ii) 1950 Warranty Deed
The record also contains the June 1950deed for 5003 Dexter, the other All Saintsproperty, which Robert McCart Jr., hiswife Alice W. McCart, Fannie Belle Hack-ney, her husband T.E.D. Hackney, andJohn Lee McCart conveyed to C. AveryMason, ‘‘Bishop of the Protestant Episco-pal Church, Diocese of Dallas, in the Stateof Texas, and his successors in office’’ for$4,000. It contains no trust language.
(iii) 1984 Judgment
The 1984 judgment transferred legal ti-tle to both properties to the Corporation.In the 1984 judgment, the trial court stat-ed,
[L]egal title to the following real andpersonal property shall be as followsTTT [w]ith respect to the Diocese ofFort Worth, title to the following assets
and property shall be vested by this de-claratory judgment in Corporation TTT
[a]ll real property which as of December31, 1982, stands in the name of Episco-pal Diocese of Dallas or in the name ofany of its Bishops as Bishop of Dallas,including TTT Bishop Charles Avery Ma-son TTT which is physically located with-in the Count[y] of TTT Tarrant TTT de-scribed on Exhibit B attached heretoand incorporated herein by refer-enceTTTT
The trial court further stated, ‘‘Nothing inthis judgment shall be deemed to dealwith, or otherwise affect, properties, realor personal, disposed of under testamenta-ry or inter vivos gift executed or effectiveprior to December 31, 1982, which bequestis to the Diocese of Dallas or the Bishopthereof.’’
EDFW’s constitution states that title toall real property acquired ‘‘for the use ofthe Church in this Diocese,’’ including thereal property of all parishes, missions, anddiocesan institutions, shall be held ‘‘subjectto control of the Church in the[90] Episco-pal Diocese of Fort Worth acting by andthrough a corporation known as ‘Corpora-tion of the Episcopal Diocese of FortWorth.’ ’’ The Corporation is to hold realproperty acquired for the use of a particu-lar parish or mission in trust for thatparish or mission’s use and benefit, but ifthat mission or parish were to dissolve, theproperty would revert to the Corporationfor EDFW’s use and benefit.
EDFW’s canon 18.2 (previously canon12.4), revised in 1989, provides that realproperty acquired by the Corporation forthe use of a particular parish, mission, or
90. By 2006, the word ‘‘the’’ was capitalized,reciting that the property would be held ‘‘sub-
ject to control of the Church in The EpiscopalDiocese of Fort Worth.’’
428 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
diocesan school would be held in trust forthe use and benefit of such entities andthat it was ‘‘immaterial whether said ac-quisition is by conveyance to the Corpora-tion by a Parish, Mission or DiocesanSchool now holding title, by the Bishopnow holding title as a corporate sole, by adeclaratory judgment upon division fromthe Diocese of Dallas, or by subsequentconveyance to the Corporation, so long assuch property was initially acquired by aParish, Mission or Diocesan School by pur-chase, gift or devise to it, as a Parish,Mission or Diocesan School.’’ Canon 18.4,added by 1989, states that all other prop-erty of the Corporation held for EDFW isheld for exempt religious purposes—as de-fined by the Internal Revenue Code anddetermined by EDFW’s convention ‘‘andthe appropriate officers elected by it.’’ 91
Since EDFW’s inception, underEDFW’s canons, a parish can organize acorporation ‘‘to use in connection with theadministration of its affairs,’’ but it is‘‘merely an adjunct or instrumentality,’’because the parish itself, ‘‘being the bodyin union with Convention, shall not beincorporated.’’ The adjunct corporation‘‘shall not hold title to real estate acquiredfor the use of the Church in the Diocese,which title must be vested and dealt within accordance with the provisions’’ inEDFW’s constitution.
(v) All Saints Episcopal Church, Inc.
All Saints Episcopal Church incorporat-ed an entity, and in its 1991 bylaws, itadded a clause as follows with regard toproperty:
All real and personal property held byor for the benefit of All Saints’ Episco-pal Church is held in trust for TheEpiscopal Church and the Diocese
thereof in which the Church is located.The existence of this trust, however,shall in no way limit the power andauthority of All Saints’ EpiscopalChurch otherwise existing over suchproperty so long as the Church remainsa part of, and subject to The EpiscopalChurch General Convention Constitutionand Canons. Title I, Canon 7, Section 4[the Dennis Canon] of the General Con-vention Canons is hereby ratified andconfirmed in its entirety. [Emphasisadded.]
These amendments were signed by AllSaints’s clerk and rector. All Saints subse-quently deleted the last sentence, ‘‘Title I,Canon 7, Section 4 of the General Conven-tion Canons is hereby ratified and con-firmed in its entirety,’’ in 2001, but theremainder went unchanged.
(b) Identification of Beneficiaries
(i) Other Summary JudgmentEvidence
We have previously set out the historyof TEC’s presence in Texas, beginning in1849 with the formation of the Diocese ofDallas, which gave birth to EDFW, whichin 1982 received approval from TEC andacceded to TEC’s constitution and canons.
(A) TEC’s Constitution and Canons
There was no substantive change inTEC’s relevant constitutional and canoni-cal provisions between 1979 and 2006. Thepreamble to TEC’s constitution states thatthe association’s name is the ProtestantEpiscopal Church in the United States ofAmerica, ‘‘otherwise known as The Episco-pal Church (which name is hereby recog-nized as also designating the Church).’’The constitution also sets out the method
91. Pursuant to the 1989 revisions, section18.4 also expressly disclaims any beneficial
interest for TEC.
429Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
that EDFW followed in becoming a TECdiocese. Other provisions explain how twodioceses can be reunited into one (essen-tially, the dissolution of one of two diocesesinto its originating diocese) and that formissionary dioceses outside the territoryof the United States of America, TEC’spresiding bishop can consult ‘‘with the ap-propriate authorities in the Anglican Com-munion’’ and ‘‘take such action as neededfor such Diocese to become a constituentpart of another Province or RegionalCouncil in communion with’’ TEC. There isno corresponding provision in TEC’s con-stitution and canons for a diocese—mis-sionary or not—within the United Statesto separate from TEC.
Although the Dennis Canon did not setforth a valid express trust under Texaslaw, its language provides some indicationof how TEC views Church property: par-ish property is held for ‘‘this Church andthe Diocese thereof in which such Parish,Mission or Congregation is located.’’ Like-wise, TEC’s canons provide that ‘‘[n]oChurch or Chapel shall be consecrated un-til the Bishop shall have been sufficientlysatisfied that the building and the groundon which it is erected are secured forownership and use by a Parish, Mission,Congregation, or Institution affiliated withthis Church and subject to its Constitutionand Canons.’’
(B) EDFW’s Constitution and Canons
(I) EDFW’s Geographic Description
EDFW’s constitution and canons, asadopted by conventions from 1982 to 2006,included the following geographic descrip-tion of EDFW:
The Diocese of Fort Worth shall consistof those Clergy and Laity of the Episco-pal Church in the United States ofAmerica resident in that portion of theState of Texas including the twenty-three (23) Counties of Archer, Bosque,
Brown, Clay, Comanche, Cooke, Dallas(only that portion of the County thatincludes the City of Grand Prairie),Eastland, Erath, Hamilton, Hill, Hood,Jack, Johnson, Mills, Montague, PaloPinto, Parker, Somervell, Stephens, Tar-rant, Wichita, Wise, and Young.
This provision was omitted in the 2008constitution and canons.
Pursuant to the 1982 constitution, everyparish and mission in EDFW
in existence at the time of the organiza-tion of the Diocese and every Parish andMission which shall have been createdand admitted in accordance with theConstitution and Canons of this Diocese,shall be deemed to be in union with andentitled to representation in the Conven-tion of the Diocese, unless deprived ofsuch right either through suspension ordissolution. [Emphasis added.]
By 2006, the provision about existence atthe time of EDFW’s organization had beendeleted and was modified to read, ‘‘EveryParish and Mission which shall have beencreated or admitted in accordance with theConstitution and Canons of this Dio-ceseTTTT’’ [Emphasis added.] There was nosubstantive change between 2006 and 2008as to the definition of who would be consid-ered ‘‘in union with’’ EDFW.
(II) 1982
On November 13, 1982, ‘‘pursuant to theapproval of the 67th General Convention ofThe Episcopal Church,’’ EDFW acceded toTEC’s constitution and canons andadopted its own constitution and canons.The preamble of that constitution states,‘‘We, the Clergy and Laity of the Episco-pal Church, resident in that portion of theState of Texas, constituting what is knownas the Episcopal Diocese of Fort Worth,do hereby ordain and establish the follow-ing constitution[.]’’ The original governing
430 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
EDFW documents consisted of 18 articlesand 39 canons. They set out recognition ofthe authority of TEC’s General Conventionby ‘‘The Church in this Diocese,’’ and setout governing procedures for EDFW’sconventions, its annual meeting, voting,92
and amending the constitution.93 Canonsthat were ‘‘not inconsistent’’ with the dioc-esan convention or with TEC’s constitutionand canons could be adopted, altered,amended, or repealed at any annual con-vention by a majority vote, subject to no-tice requirements. We have already set outabove the constitutional and canonical pro-visions dealing with real property.
(III) 2006
By 2006, over two decades later,EDFW’s constitution increased from 18 to19 articles, and its number of canons in-creased to 42. There was no change to thepreamble, but the first article, ‘‘Authorityof General Convention,’’ was modified tostate,
The Church in this Diocese accedes tothe Constitution and Canons of TheEpiscopal Church, and recognizes theauthority of the General Convention ofsaid Church provided that no action ofGeneral Convention which is contraryto Holy Scripture and the ApostolicTeaching of the Church shall be of anyforce or effect in this Diocese. [Emphasisadded.]
Additionally, the article on canons saw arephrasing that allowed greater latitude inEDFW’s discretion, from the earlier,‘‘Canons not inconsistent with this Consti-tution, or the Constitution and Canons ofthe General Convention, may be adopted,
altered, amended, or repealed at any An-nual Convention by a majority vote of theConvention,’’ to ‘‘Canons consistent withthis Constitution, and the Constitution andCanons of the Episcopal Church, may beadopted, altered, amended, or repealed atany Annual Convention by a majority voteof the Convention.’’ [Emphasis added.]
(IV) 2008
In 2008, EDFW’s constitution retained19 articles but the number of canons in-creased from 42 to 44, and the diocese’sgeographic description was deleted. Theconstitution and canons were significantlymodified, beginning with the preamble,from the original, ‘‘We, the Clergy andLaity of The Episcopal Church, resident inthat portion of the State of Texas, consti-tuting what is known as The EpiscopalDiocese of Fort Worth,’’ from 1982–2006, to‘‘We, the Clergy and Laity of The Episco-pal Diocese of Fort Worth.’’ [Emphasisadded.]
Article 1, previously ‘‘Authority of Gen-eral Convention,’’ was replaced with ‘‘An-glican Identity,’’ stating,
The Episcopal Diocese of Fort Worthis a constituent member of the AnglicanCommunion, a Fellowship within theOnly Holy Catholic and ApostolicChurch, consisting of those duly consti-tuted Dioceses, Provinces and regionalChurches in communion with the See ofCanterbury, upholding and propagatingthe historic Faith and Order as set forthin the Old and New Testaments andexpressed in the Book of Common Pray-er. [Emphasis added.]
92. The constitution provided for majority rule‘‘[u]nless a vote by orders is determined orrequired or otherwise provided by the Consti-tution or Canons’’ or where the constitutionor canons require a two-thirds vote.
93. The constitution provided for majority votein the first year of the constitutional amend-ment’s consideration by the annual conven-tion, and then a concurrent majority of thevote of both orders in the second year of itsconsideration by the annual convention.
431Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
Article 18, ‘‘Canons,’’ was amended to de-lete reference to the Constitution and Can-ons of TEC’s General Convention.94 Mostof EDFW’s canons that contained refer-ences to ‘‘The Episcopal Church in theUnited States of America’’ were amendedto remove those references,95 although theexpress denial of a beneficial interest inTEC in property held by the Corporationin canon 18 was retained.96 A new constitu-tional article was added to provide fordeputies or delegates to ‘‘extra-diocesanconventions or synods.’’ Canon 32, previ-ously entitled ‘‘Controversy between Rec-tor and Vestry,’’ was amended to covercontroversies ‘‘between a Parish and theDiocese.’’
The record reflects that on three occa-sions during 2008—January 9, February12, and September 8—Bishop Iker and thestanding committee presented reports toEDFW on the constitutional and canonicalimplications and means of becoming amember diocese of the Anglican Provinceof the Southern Cone. The third report
recommended that EDFW affiliate withthe Anglican Province of the SouthernCone as a member diocese ‘‘until such timeas an orthodox Province of the AnglicanCommunion can be established in NorthAmerica.’’ Bishop Iker likewise issued astatement entitled, ‘‘10 Reasons Why NowIs the Time to Realign,’’ which includedobserving that ‘‘[a]t this time there is noth-ing in the Constitution or Canons of TECthat prevents a Diocese from leaving TTT
[s]o we have this window of opportunity todo what we need to do’’ before TEC’sGeneral Convention could adopt amend-ments making it more difficult to separate.
(ii) Associations Law versus Identity
(A) The Parties’ Arguments
The TEC parties apply a macro-levelapproach to the associative relationship be-tween TEC and EDFW by arguing thatthe First Amendment forbids us fromoverriding TEC on the question of who canrepresent an Episcopal diocese or congre-
94. The new provision stated, ‘‘Canons consis-tent with this Constitution may be adopted,altered, amended, or repealed at any AnnualConvention of the Episcopal Diocese of FortWorth by a majority vote of the Convention.’’
95. For example, whereas the 2006 canons onmissions and new parishes required in theapplication to join EDFW that aspirant mem-bers of missions or parishes ‘‘promise toabide by and to conform to the Constitutionand Canons of the General Convention, andof the Diocese of Fort Worth,’’ the 2008 can-ons required that they ‘‘promise to abide byand to conform to the Constitution and Can-ons of the Episcopal Diocese of Fort Worth.’’The annual parochial report that every parishand mission was required to prepare ‘‘uponthe form provided by The Executive Councilof The Episcopal Church in the United Statesof America’’ was changed in the 2008 amend-ments to ‘‘upon the form provided by TheEpiscopal Diocese of Fort Worth.’’ The 2006canons provided that books and accounts inevery congregation in EDFW ‘‘shall conformto THE MANUAL OF BUSINESS METHODS
IN CHURCH AFFAIRS of The EpiscopalChurch in the United States of America.’’ Thisrequirement was changed in 2008 to requireconformance ‘‘to generally accepted account-ing principles.’’
96. Article 17, ‘‘Election of Bishops and Call-ing of an Assistant Bishop,’’ in an apparentoversight, continued to provide that the bish-op ‘‘may call an Assistant Bishop in accor-dance with the Constitution and Canons of theEpiscopal Church.’’ [Emphasis added.] Thestanding rules of procedure of the annualconvention with regard to appointments, inanother apparent oversight, continued to pro-vide that
The Bishop shall have the authority to ap-point all Board members, Trustees, Com-mittee members, and fill other positionswhich are not required to be elected orotherwise selected by the Constitution orCanons of the Episcopal Church in the Unit-ed States of America, the Constitution orCanons of the Diocese of Fort Worth or anyother lawful authority. [Emphasis added.]
432 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
gation and that under associations law,only the TEC parties are entitled to con-trol EDFW. That is, the TEC parties viewAppellees’ claimed disaffiliation as void un-der the larger association’s rules and theGeneral Convention’s determination thatthe alleged disaffiliation was a nullity.They also argue that the All Saints proper-ties are held in trust for TEC and for theAll Saints Church affiliated with TEC.
Appellees respond that this is not anecclesiastical dispute and claim that‘‘[s]ince a dispute about the officers of aTexas corporation is not ecclesiastical,then a dispute about the officers of a Tex-as unincorporated association isn’t either.’’They also argue that the highest authorityon property issues—within or outside ofTEC—is the local bishop, not TEC’s ad-ministrative officers, reciting terminologyfrom TEC’s Canons, Title IV, ‘‘Ecclesiasti-cal Discipline,’’ which defines ‘‘ecclesiasti-cal authority’’ as the diocese’s bishop orstanding committee ‘‘or such other ecclesi-astical authority established by the Consti-tution and Canons of the Diocese.’’
Appellees further argue that ‘‘[t]hefounders of TEC had made similar solemnengagements to the Church of England—but they certainly didn’t forfeit churchproperty in America when those churchesseparated.’’ 97 And they argue, ‘‘[N]one of
the property documents incorporate reli-gious tests, and neither side has asked thecourts to decide who can lead worship orattend church conventions,’’ nor have thecourts been asked ‘‘to decide who can leadany religious body, or whether diocesescan withdraw from TEC.’’ 98
Appellees point out that Texas law dic-tates how the association’s and corpora-tion’s officers can be elected or replaced,and Texas law governs the Corporation’sand EDFW’s amendments to drop anyreference to TEC. Appellees rely on theCorporation’s holding legal title and theirdefendant-congregations holding beneficialtitle based on their union with the diocesanconvention. They argue: (1) EDFW’s con-stitution and canons define missions andparishes as unincorporated associations inunion with the diocesan convention; thosenot ‘‘in union’’ are not entities for whichthe Corporation holds property and those‘‘in union’’ are those who send delegates tothe convention’s annual meeting; (2) Texaslaw makes EDFW’s constitution and by-laws controlling, and the annual conventionelected Bishop Iker and opted to disaffili-ate; and (3) TEC’s ‘‘newly formed’’ diocesedid not inherit the property of the existingdiocese simply by adopting the samename.99
97. Appellees conveniently ignore the revolu-tionary reason for the separation and the geo-political and logistical complexity in the1700s that recuperating such property wouldhave entailed.
98. As noted by the court in Diocese of SanJoaquin, we do not have to decide whether adiocese can leave TEC to resolve this proper-ty-based dispute. See 202 Cal.Rptr.3d at 63–64. And per Westbrook, we cannot decidewhether a diocese can leave TEC. See 231S.W.3d at 403 (referring to the spirit of free-dom for religious organizations ‘‘even if thatfreedom comes at the expense of other inter-ests of high social importance’’).
99. Perhaps learning from other dioceses’ ex-perience, one of Appellees’ theories appearsto be ‘‘Keep the name, keep the stuff.’’ SeeDiocese of San Joaquin, 202 Cal.Rptr.3d at66–67 (holding attempts to transfer propertyfrom The Protestant Episcopal Bishop of SanJoaquin to The Anglican Bishop of San Joa-quin invalid). They also argued in the trialcourt that turning churches over to congrega-tions that do not use them would violate theexpress trust in EDFW’s charters for the ben-efit of those who actually use them and that tohold against them would unjustly enrich aminority group ‘‘too small to impose its will’’during the schism.
433Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
The TEC parties reply that Appellees’own theory concedes that the neutral prin-ciples analysis establishes legally-enforce-able trusts for EDFW and its congrega-tions, which leads to the ecclesiasticalquestion of who may control these reli-gious entities and puts the case squarelywithin the exception Masterson and Epis-copal Diocese detailed (i.e., ecclesiasticalstructure determines property dispute).They further argue that the All Saintsproperties are in trust for the TEC-affiliat-ed All Saints based on All Saints’s govern-ing documents, particularly the All Saints2001 bylaws.
(B) Analysis
[59] We must initially determinewhether this is an associations-law ques-tion or an identity question.100 To do so, wemust look at the substance and effect ofthe TEC parties’ live pleading. In their livepleading, the TEC parties intermingled anumber of claims seeking legal and equita-ble relief with others seeking relief basedon doctrine and internal procedures. Someof their claims, particularly as beneficiariesof trusts—as set out above—are claimsthat we may legitimately consider in ourneutral-principles review. Based on theabove, we have determined that there is aquestion about who is the ‘‘ProtestantEpiscopal Church, within the territoriallimits of what is now known as the saidDiocese of Dallas, in the State of Texas,’’referred to in the 1947 deed.
With that in mind, we note that oursupreme court has already identified TEC
as a hierarchical organization and has stat-ed that whether TEC’s appointed bishopcan take such actions as forming a parish,recognizing membership, and authorizingthe establishment of a vestry ‘‘are ecclesi-astical matters of church governance’’ overwhich the court lacks jurisdiction. Master-son, 422 S.W.3d at 608. Our supreme courthas also acknowledged that TEC’s appoint-ed bishop could, ‘‘as an ecclesiastical mat-ter, determine which faction of believerswas recognized by and was the ‘true’church loyal to the Diocese and TEC.’’ Id.at 610. TEC has recognized the TEC par-ties as the Episcopal Diocese of FortWorth.
And notwithstanding any ecclesiasticalimplications, where the internal actions ofTEC and EDFW are not illegal in thenonecclesiastical sense, fraudulent, againstpublic policy, or a threat to public healthand safety, judicial review of these actionswould be improper. See Westbrook, 231S.W.3d at 392, 402, 404; Whitmire, 2009WL 2196126, at *4–5; Harden, 634 S.W.2dat 59–60. One of the questions before us,then—to the extent we can consider it—iswhether this record reflects that their ac-tions were illegal, against public policy,fraudulent, or a threat to public health andsafety, or whether, instead, they wereproper actions that were permissible andbinding on their members under their in-ternal rules. To the limited extent that wecan consider these organizations’ internalactions, we do not think that the recordaffirmatively reflects any activities thatwere per se illegal in a nonecclesiastical
100. If it is an identity question—i.e., whetherAppellees are ‘‘Episcopal’’ (capital-E) ormerely ‘‘episcopal’’ (lowercase-e) as pertainsto ‘‘of, being, or suited to a bishop,’’ seeepiscopal, Webster’s 3rd New Int’l Dictionary764 (3rd ed. 2002)—then the First Amend-ment bars our consideration of this religiousissue within the limits set out by U.S. Su-preme Court jurisprudence. Webster’s second
definition of ‘‘episcopal’’ has two parts: (a)‘‘of, advocating, or governed by an episcopa-cy,’’ and (b) ‘‘of or relating to the ProtestantEpiscopal Church or the Episcopal Church inScotland.’’ Id. at 764–65. Webster’s defines‘‘episcopalian’’ as (1) an adherent to the epis-copal form of church government and (2) ‘‘amember of an episcopal church (as the Prot-estant Episcopal Church).’’ See id. at 765.
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sense or against public policy, fraudulent,or against public health and safety.
Although Appellees argue that understate associations law they were withintheir rights to remove the diocese anddiocesan property from TEC, such lawapplies to the rules used by associations toregulate, within legal limits, their own in-ternal affairs, not to the question of anassociation’s identity. Compare Juarez, 172S.W.3d at 279 (private association’s rightto govern its affairs), with Jones, 443 U.S.at 604, 99 S.Ct. at 3026 (stating that if theinterpretation of an ownership instrumentrequires resolution of a religious contro-versy, the court must defer to resolution ofthe doctrinal issue by the authoritativeecclesiastical body), and Westbrook, 231S.W.3d at 398, 400 (quoting Minton, 297S.W. at 621–22, to explain why courts mustdecline jurisdiction over disputes concern-ing church membership and holding thatwhile neutral principles may define a dis-pute, their application may impinge on achurch’s ability to manage its internal af-fairs). Further, their assertion ignores thefact that EDFW was part of the larger,hierarchical association and subject to thelarger association’s constitution and canonsuntil disaffiliation.101
Under associations law, while the mem-bers of EDFW were within their rights tomodify their governing documents howev-er they saw fit as long as they did so byfollowing their own internal rules, EDFWwas also a member entity of a larger asso-ciation, and its actions in modifying itsgoverning documents directly conflicted
with the larger association’s governingdocuments. When it defied the governingstrictures of the association of which it wasa member, and particularly when it de-clared itself apart from that organization,it lost its identity as a part of that largerassociation.102 See Green, 808 S.W.2d at550–51 (listing factors courts consider toidentify whether a church is hierarchical);Templo Ebenezer, Inc., 752 S.W.2d at 198(distinguishing hierarchical churches fromcongregational churches based on the con-gregational-type church’s independenceand ability to ‘‘totally control[ ] its owndestiny’’).
[60] TEC’s dioceses are members ofTEC, identified by the dioceses’ accessionto TEC’s governing rules, just as parishessimultaneously accede both to TEC’s gov-erning rules and to their governing dio-cese’s rules. Individual members of a par-ish may decide to worship elsewhere; amajority of individual members of a parishor diocese may decide to do so. But whenthey leave, they are no longer ‘‘Episcopali-ans’’ as identified by TEC; 103 they becomesomething else. And that something else isnot entitled to retain property if that prop-erty, under the terms of the deed, is heldin trust for a TEC-affiliated diocese orcongregation. By rejecting TEC, Appelleesalso rejected any claim to items and prop-erty affiliated with TEC or with being aTEC-affiliated diocese to the extent thatthe instruments of ownership spell out anexpress interest. While a decision to disaf-filiate is an ecclesiastical matter, what hap-pens to the property is not, unless the
101. Representatives from each parish andmission voted in EDFW’s conventions; EDFWrepresentatives, until 2008, voted in TEC con-ventions. TEC set up rules over EDFW, andEDFW set up rules over parishes, missions,and other congregations, which were alsogoverned by TEC’s rules until 2008.
102. The obedience or disobedience of TEC toan even larger body—the Anglican Commun-ion—is not a question before us and not onethat we could address even if it were.
103. Under article V of TEC’s constitution,there are only three ways to create a newdiocese, voiding Appellees’ argument that theTEC-affiliated diocese is a ‘‘new’’ diocese.
435Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
affairs have been ordered so that the eccle-siastical decisions effectively determine theproperty issue, see Masterson, 422 S.W.3dat 607, and the macro-level view of theassociations’ relationship is consistent withthe deference we are required to give tothe ecclesiastical determination by a hier-archical church. See id. (‘‘Civil courts areconstitutionally required to accept as bind-ing the decision of the highest authority ofa hierarchical religious organization towhich a dispute regarding internal govern-ment has been submitted.’’).
The plain language of the 1947 deed setsforth a trust with the identified beneficiaryas ‘‘the Protestant Episcopal Church’’ as itwas located within the territorial limits ofwhat was formerly the Diocese of Dallas.As set out above, it was within those terri-torial limits that the Diocese of Dallasgave birth to EDFW. From the variousdocuments in the record of this case, the‘‘Protestant Episcopal Church’’ identifiedin the deed at the time of the deed’smaking is TEC, thus making TEC’s localFort Worth affiliate the beneficiary of thetrust. That is, the trust did not make TECitself the beneficiary; rather, by its lan-guage, the trust identified the diocese af-filiated with TEC as located within thatterritory as the beneficiary. This is most
clear when considering that the 1984 judg-ment did not actually touch the property’sequitable title, which was vested in theChurch in a diocese whose name and geo-graphic configuration might change as, an-ticipated since 1910, the giant Diocese ofDallas would—and subsequently did—pur-suant to its division into two TEC dioceses.TEC continues to exist and has identifiedits affiliate within the territory. See Epis-copal Diocese, 422 S.W.3d at 652 (‘‘[D]eter-mination of who is or can be a member ingood standing of TEC or a diocese is anecclesiastical decision.’’).
Plugging these answers into our flowchart leads us to the conclusion that theTEC-affiliated EDFW holds the equitableinterest under the 1947 deed.104 That is,because there is a question about who is‘‘the Protestant Episcopal Church, withinthe territorial limits of what is now knownas the Diocese of Dallas,’’ we must askwhether TEC is a hierarchical church. Be-cause our supreme court has already de-termined that TEC is a hierarchicalchurch, see Masterson, 422 S.W.3d at 608,we must defer to TEC’s identification of itsaffiliated diocese when no claim of fraud orcollusion for secular purposes, or a threatto public health and safety, has beenraised.
104. Although EDFW’s canon on real propertypurported to create a trust on real propertyacquired by the Corporation ‘‘for the use of aparticular parish or mission,’’ neither the1947 deed nor the canon itself identifies AllSaints as the beneficiary of the trust, and
there is no indication that the property ‘‘wasinitially acquired by’’ All Saints Parish ‘‘bypurchase, gift or devise to it’’ as a parish.Accordingly, no trust was expressly createdfor All Saints by EDFW in its governing docu-ments.
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[61] As to the 1947 deed presented tous for review, we cannot say—because wemay not delve into questions of theology—whether the group that left TEC sharesthe same beliefs as the original EDFW’s
membership at the time of the deed. Wemay not consider the religious beliefs ofanyone when making a legal determinationunder neutral principles. See Jones, 443U.S. at 604, 99 S.Ct. at 3026 (stating that
437Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
when the deed incorporates religious con-cepts in the provisions relating to the own-ership of property, if the interpretation ofthe ownership instrument requires thecourt to resolve a religious controversy,‘‘then the court must defer to the resolu-tion of the doctrinal issue by the authorita-tive ecclesiastical body’’); PresbyterianChurch, 393 U.S. at 450, 89 S.Ct. at 606–07(stating that the First Amendment forbidscivil courts from considering whether gen-eral church’s actions constitute a substan-tial departure from the tenets of faith andpractice existing at the time of the localchurches’ affiliation); Brown, 116 S.W. at364–65 (‘‘[T]he church to which the deedwas made still owns the property, and TTT
whatever body is identified as being thechurch to which the deed was made muststill hold the title.’’); cf. Diocese of Quincy,2014 IL App (4th) 130901, ¶ 47, 383 Ill.Dec.634, 14 N.E.3d at 1256 (concluding defer-ence does not apply when hierarchicalstructure is not discernible). All we havedone here is apply the binding precedentof the United States and Texas SupremeCourts to the plain language of the instru-ments of title.
As to the 1950 deed, although EDFWattempted to impose a trust for All Saintsin its governing documents, per Master-son, based on the plain language of thedeed and the 1984 judgment, the Corpora-tion holds both legal and equitable title tothis property. See 422 S.W.3d at 610 (‘‘Un-der neutral principles of law, the deedsconveying the property to Good Shepherdcorporation ‘expressed no trust nor limita-tion upon the title,’ and therefore the cor-poration owns the property.’’). As such,EDFW could not declare itself or anyoneelse as the beneficiary of property to
which it held neither a legal nor equitableinterest.105 See Lipsey, 983 S.W.2d at 351n.7; Best Inv. Co., 479 S.W.2d at 763.
We sustain the TEC parties’ subissues1(a) and 1(b) and part of subissue 1(c), andwe sustain TEC’s sole stand-alone issuewith regard to whether the trial courterred as a matter of law in its applicationof neutral principles by failing to defer toTEC’s ecclesiastical determination ofwhich entity constitutes EDFW.
(c) Adverse Possession
Appellees argue that 1989’s canon 18expressly disclaimed any beneficial inter-est for TEC and that because EDFW wasa separate legal entity controlled by itsown convention, TEC’s claim for a trustinterest was barred by limitations. But wehave already held that TEC has no trustinterest in the two properties at issue.
[62] With regard to a trust interest bythe remaining TEC parties, until 2008,when Appellees formally severed ties toTEC, Appellees’ possession of the proper-ties was not adverse—‘‘hostile,’’ under aclaim of right inconsistent with another’sclaim—to them. See Tex. Civ. Prac. &Rem. Code Ann. § 16.021(1) (West 2002).Accordingly, the trial court erred by grant-ing summary judgment for Appellees onthe two pieces of property at issue if itgranted summary judgment on this basis,and we sustain the TEC parties’ subissue1(i).
(d) Conclusion
To avoid delving into ecclesiastical mat-ters—considerations forbidden to us bythe First Amendment and U.S. SupremeCourt and Texas Supreme Court prece-
105. All Saints likewise attempted to impose atrust on this property for EDFW and TEC, butit held no interest that would have allowed itto do so. Further, it did so through its incor-
porated entity, which also held neither a legalnor an equitable interest. Therefore, its at-tempted trust also failed.
438 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
dent—we conclude that the Corporationholds the property identified in the 1947deed in trust for the TEC-affiliatedEDFW and holds legal and equitable titleto the property identified in the 1950 deed.We sustain the TEC parties’ subissue 1(e)as it relates to the 1947 deed and theirsubissue 1(k) as to the 1947 deed andremand this portion of the case for recon-sideration of the other deeds containingthe language ‘‘similar’’ to that identifiedabove.
3. Control of the Corporation
We must now determine who controlsthe Corporation.106 As stated by the su-preme court in Masterson, the principlesset out in our business organizations codegovern because the Corporation ‘‘was in-corporated pursuant to secular Texas cor-poration law and Texas law dictates howthe corporation can be operated, includinghow and when corporate articles and by-laws can be amended and the effect of theamendments.’’ 422 S.W.3d at 613; see Tex.Bus. Orgs. Code Ann. §§ 1.002(59),22.001(3); see also id. § 2.002(1) (West2012).
a. The Corporation’s Formationand Governance
(1) Articles and Bylaws
As set out in our factual recitation, theCorporation’s articles of incorporationwere filed in the Texas Secretary ofState’s Office on February 28, 1983, andestablished that the Corporation’s purposewas ‘‘[t]o receive and maintain a fund orfunds or real or personal property, orboth, from any source including all realproperty acquired for the use of the Epis-copal Diocese of Fort Worth as well as thereal property of all parishes, missions anddiocesan institutions.’’ [Emphasis added.]Property held by the Corporation was to
be ‘‘administered in accordance with theConstitution and Canons of the EpiscopalDiocese of Fort Worth as they now existor as they may hereafter be amended.’’The Corporation’s articles also set out thatits bylaws would address the election of itsboard of directors and their terms of of-fice.
The 1983 bylaws specified that the Cor-poration’s affairs would be ‘‘conducted inconformity with the Constitution and Can-ons of the Episcopal Church in the UnitedStates of America and the Constitutionand Canons of the Episcopal Diocese ofFort Worth, as they may be amended orsupplemented from time to time by theGeneral Convention of the Church or bythe Convention of the Diocese,’’ and thatany conflict between the bylaws and theconstitution and canons would be resolvedin favor of the constitution and canons.
With regard to the number, election, andterm of office of trustees for the ‘‘DiocesanCorporation,’’ the bylaws provided forEDFW’s bishop to be the chairman, plusfive elected trustees serving five-yearterms, with one trustee to be elected everyyear at the annual convention. Each of theelected trustees would serve until his suc-cessor’s election and qualification or ‘‘untilhis death, resignation, disqualification orremoval.’’ The bylaws specified that to bequalified, a trustee ‘‘may be either laypersons in good standing of a parish ormission in the Diocese of Fort Worth, ormembers of the Clergy canonically resi-dent within the Diocese.’’ Any trustee atthat time could be removed by EDFW’sbishop. The bylaws also provided foramendment ‘‘by the affirmative vote of amajority of the total number of Trustees atany regular or special meeting of theBoard, if notice of the proposed change isincluded in the notice of such meeting.’’
106. This issue will determine standing for the ownership issue as to the 1950 deed.
439Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
The 2006 bylaw amendments providedthat the Corporation’s affairs
shall be conducted in conformity withthe body now known as the EpiscopalDiocese of Fort Worth’s acknowledg-ment of and allegiance to the One, Holy,Catholic and Apostolic Church of Christ;recognizing the body known as the An-glican Communion to be a true branchof said Church; with all rights and au-thority to govern the business and af-fairs of the Corporation being solely inthe board of trustees (as hereinafter de-fined, the ‘‘Board’’) of the Corporation.[Emphasis added.]
This amendment deleted prior reference to‘‘the Constitution and Canons of the Epis-copal Church in the United States ofAmerica and the Constitution and Canonsof the Episcopal Diocese of Fort Worth.’’
A new section was added to facilitateidentification of the EDFW bishop aschairman of the board, stating, in pertinentpart, ‘‘The bishop recognized by the bodynow known as the Episcopal Diocese ofFort Worth (the ‘‘Bishop’’) shall be a trus-tee and a member of the Board.’’ [Empha-sis added.]
There was no change to the number,election, or term of office for trustees oth-er than to clarify that the trustees, whowere elected at a rate of one per annualmeeting, could be either lay persons ingood standing of a parish or mission ‘‘inthe body now known as the EpiscopalDiocese of Fort Worth’’ or members of theclergy ‘‘canonically resident within thegeographical region of the body nowknown as the Episcopal Diocese of FortWorth.’’ [Emphasis added.] The rest of thesections remained substantively unchangedexcept for the section pertaining to remov-al of trustees—while the previous sectionprovided that any trustee could be re-moved by the bishop, the amended sectionstated that any elected trustee could be
removed by a majority of the remainingmembers of the board.
The Corporation’s September 2006amended and restated articles of incorpo-ration deleted the portion of the earlierarticle with regard to real property ac-quired for the use of the diocese, parishes,missions, and diocesan institutions andstated that the Corporation was organized‘‘[t]o receive and maintain a fund or fundsor real or personal property, or both, fromany source.’’ The articles were also amend-ed to delete reference to EDFW’s consti-tution and canons with regard to the ad-ministration of the property held by theCorporation. The articles incorporated thesame provision as the amended bylaws toidentify the Corporation’s chairman.
(2) Corporate Records
Virden, who had been the Corporation’ssecretary since 1983, averred in his affida-vit that he was the custodian of the Corpo-ration’s business records. He sponsoredexcerpts from the Corporation’s officialminutes, which showed that on August 15,2006, the board of trustees voted to amendthe Corporation’s articles and bylaws. Be-tween February 1, 2005 and 2014, the rec-ord reflects no change in the Board’s com-position of Bishop Iker, Salazar, Patton,Bates, Barber, and Virden. None of theCorporation’s minutes reflect the removalor resignation of any trustee nor the elec-tion of any other trustees.
At the August 15, 2006 meeting, all ofthe trustees—Bishop Iker, Salazar, Patton,Bates, Barber, and Virden—were present.Bishop Iker requested that the minutes‘‘reflect that due notice was given to alltrustees that the meeting would includeconsideration and voting on the adoption ofAmended and Restated Articles of Incor-poration for the Corporation TTT and pro-posed amendments to the bylaws of the[C]orporation.’’ Bates moved to adopt the
440 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
proposed amendments to the bylaws, Pat-ton seconded the motion, and the motionpassed unanimously. Patton moved to ap-prove the amended and restated articles ofincorporation, Bates seconded her motion,and the motion passed unanimously.
(3) Other Documents
EDFW’s constitution and canons provid-ed for the establishment of the Corpora-tion. Article 13 of the 1982 Constitution,‘‘Title to Church Property,’’ provides—inpertinent part to the corporations lawquestion before us—that title to the realproperty of all parishes, missions, and di-ocesan institutions ‘‘acquired for the use ofthe Church in this Diocese’’ before or afterthe constitution’s adoption, would be vest-ed in the Corporation and ‘‘shall be heldsubject to control of the Church in theEpiscopal Diocese of Fort Worth acting byand through’’ the Corporation. The Corpo-ration, in turn, would hold real propertyacquired ‘‘for the use of a particular parishor mission in trust for the use and benefitof such parish or mission.’’ The Corpora-tion could not convey, lease, or encumbersuch property without the consent of therector, wardens, and vestry of such parishor mission. If a parish or mission weredissolved, the property held in trust by theCorporation ‘‘shall revert to said Corpora-tion for the use and benefit of the Diocese,
as such.’’ The same article in the 1989,2006, and 2008 EDFW constitution andcanons reflects no change other than re-numbering. The corresponding canon,‘‘Corporation of the Episcopal Diocese ofFort Worth,’’ established the Corporation’spurposes and management of its affairs.
b. Application
(1) The Parties’ Arguments
[63] The TEC parties argue that ei-ther the TEC parties control the Corpora-tion or Appellees are in breach. Specifical-ly, they complain that the trial court failedto apply the portion of the 2006 corporatebylaws requiring each director to be amember in good standing of a parish in thediocese when, by December 5, 2008 (orFebruary 2009 at the latest), Appelleesheld no role in the diocese, making them‘‘disqualified.’’ They refer us to Byerly v.Camey, 161 S.W.2d 1105, 1111 (Tex. Civ.App.—Fort Worth 1942, writ ref’dw.o.m.),107 to support this proposition. Theyfurther argue that the Corporation isbound by its fiduciary duties as a trusteeto EDFW and its congregations so, if wefind that Appellees legitimately control theCorporation, then the Corporation shouldbe removed as trustee, citing Ditta v.Conte, 298 S.W.3d 187, 192 (Tex. 2009).108
107. In Byerly, we observed that the absenceof a corporation’s directors was insufficient todissolve the corporation or show that it hadceased to exist. 161 S.W.2d at 1111 (‘‘[N]ocourt would declare the corporation out ofexistence simply because it found itself with-out directors.’’). Instead, under general prin-ciples of corporation law, the stockholderseither would have the inherent power to electnew directors or a court could bring aboutthe selection of new directors ‘‘as may bedone in certain cases where a trust estatefinds itself without a trustee.’’ Id. The appealwas brought from a dismissal, though, andthe observations about corporate law had nobearing on the case’s ultimate affirmance. Id.at 1106–11. A treatise has indicated that our
1942 observation was a reflection of the com-mon law for when a corporation’s charter orbylaws made no provision for filling a boardvacancy in the event of death below the mini-mum number prescribed by the charter. See 2Fletcher Cyc. Corp. § 286. By whom directorsand officers are to be nominated, elected orappointed—In case of vacancies on the boardof directors (Sept. 2017).
108. In Ditta, the supreme court held that nostatutory limitations period restricts a court’sdiscretion to remove a trustee. 298 S.W.3d at188, 191 (observing that a removal decisionturns on the special status of the trustee as afiduciary and the ongoing relationship be-
441Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
Appellees respond that the articles andbylaws provide for trustees to be electedone per year at EDFW’s annual conven-tion and identify their qualifications. Theyfurther respond that courts cannot justremove trustees for good-faith disagree-ments about trust management. To sup-
port these arguments, they refer us to Hillv. Boully, No. 11-08-00289-CV, 2010 WL2477868, at *4 (Tex. App.—Eastland June17, 2010, no pet.) (mem. op.),109 Kappus v.Kappus, 284 S.W.3d 831, 837 (Tex. 2009),110
section 22.212 of the business organiza-tions code,111 and section 112.054 of theproperty code.112
tween trustee and beneficiary, not on anyparticular or discrete act of the trustee). Trus-tee removal actions are sometimes premisedon the trustee’s prior behavior but exist toprevent the trustee from engaging in furtherbehavior that could potentially harm the trust.Id. at 192. As long as potential harm to thetrust remains, an action to remove the trusteeshould be allowed to proceed. Id. A trusteemay be removed by a court under propertycode section 113.082 for various reasons. Tex.Prop. Code Ann. § 113.082 (listing as groundsmaterial violation or attempted violation ofthe terms of the trust resulting in a materialfinancial loss, incapacitation or insolvency ofthe trustee, failure of the trustee to make anaccounting required by law or the trust’sterms, and, broadly, ‘‘other cause for remov-al’’).
109. Hill involved the construction and appli-cation of the bylaws of Sportsman’s WorldRanch Owners’ Association, Inc., a Texasnonprofit corporation created in connectionwith a real estate development, and the decla-ration of covenants, conditions, and restric-tions associated with the development, whichprovided that record property owners weremembers of the corporation, with one voteper acre owned. 2010 WL 2477686, at *1–2.The bylaws provided for a board of threetrustees and that any trustee could be re-moved, with or without cause, by a majorityvote of the corporation’s membership; if atrustee died, resigned, or was removed, hissuccessor would be selected by the two re-maining board members to serve out his pre-decessor’s unexpired term. Id. at *2. The cor-poration’s members sought to remove two ofthe three trustees and asked the remainingtrustee to appoint two new ones; he did so. Id.at *3. The court held that this complied withthe bylaws, which logically must have envi-sioned ‘‘member’’ as either singular or plural,in anticipation of two trustees resigning ordying at the same time. Id. at *6.
110. In Kappus, the court addressed an allegedconflict of interest between the independent
executor of an estate and a good-faith disputeover his percentage ownership of estate as-sets. 284 S.W.3d at 833. The court held that‘‘conflict of interest’’ was not a ground listedin the probate code for removing an executorand that it would not engraft one onto thestatute; there was no evidence to support theexecutor’s removal under the statutorygrounds (such as dishonesty or misappropria-tion, gross misconduct or gross mismanage-ment, or legal incapacity). Id. at 833, 836–38(observing that a potential conflict does notequal actual misconduct or make one mental-ly or physically impaired to the extent thatpersonal decision-making is impossible). Thecourt noted that the fiduciary duties owed byboth an executor and a trustee are similar butthat removal of a trustee under property codesection 113.082 gives the trial court moreleeway. Id. at 838 (holding that the trial courtdid not abuse its discretion by not removingexecutor as trustee of testamentary trustwhen, viewing the same conduct, it was noterror to keep him as independent executor).
111. Business organizations code section22.212, ‘‘Vacancy,’’ does not address whathappens if there are no qualified directors lefton the board to fill a vacancy. See Tex. Bus.Orgs. Code Ann. § 22.212(a). Apparently, nei-ther the parties nor our legislature has con-sidered what might happen if a disaster wereto wipe out an entire corporate board.
112. Property code section 112.054, ‘‘JudicialModification, Reformation, or Termination ofTrusts,’’ states in subsection (a) that on thepetition of a trustee or a beneficiary, the courtmay order, among other things, that the trus-tee be changed. Tex. Prop. Code Ann.§ 112.054(a). Subsection (b) states that thecourt has the discretion to order a modifica-tion, termination, or reformation of the trust‘‘in the manner that conforms as nearly aspossible’’ to the settlor’s probable intent. Id.§ 112.054(b).
442 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
(2) Corporation’s Owner
[64, 65] There is no question that theCorporation became a nonprofit corpora-tion under Texas law in 1983 and that itsboard was allowed to amend its bylaws andarticles. As pointed out by the supremecourt in Masterson,
Absent specific, lawful provisions in acorporation’s articles of incorporation orbylaws otherwise, whether and how acorporation’s directors or those entitledto control its affairs can change its arti-cles of incorporation and bylaws are sec-ular, not ecclesiastical, mattersTTTT Thecurrent statutory scheme changes thedefault rule on who is authorized toamend the bylaws, but under neither theformer nor the current statute is anexternal entity empowered to amendthem absent specific, lawful provision inthe corporate documents.
422 S.W.3d at 609–10 (emphasis added)(referencing revised civil statutes article1396-2.09 and business organizations codesection 22.102).
According to the supreme court in Mas-terson, if nothing in the corporate docu-ments requires amendments to be subjectto approval of TEC, and no Texas lawprecludes such a corporation from amend-ing its articles and bylaws to exclude ref-erences to TEC, then there is no require-ment under Texas corporations law tootherwise subject the Corporation toTEC’s attempted interference. See id. at613 (‘‘To the contrary, the articles of in-corporation and bylaws specified thatqualified parish members were entitled toelect the vestry and amend the bylaws’’).As nothing in the Corporation’s docu-ments provides for TEC’s approval andnothing in our law precludes the amend-ments to exclude references to TEC, TEClacks standing for a claim as to the Cor-poration, and to the extent the trial court
granted summary judgment on this basis,it did not err.
Further, according to the amended by-laws, the board of directors identifies the‘‘Bishop’’ for the Corporation’s purposes.Although this might otherwise be consid-ered an ‘‘ecclesiastical’’ determination, be-cause the bylaws treat the identification ofthe ‘‘Bishop’’ as merely the identification ofthe Corporation’s chairman of the board,we cannot say that a title alone, under thecircumstances presented in the bylawshere, requires ‘‘consideration of doctrinalmatters,’’ i.e., ‘‘the ritual and liturgy ofworship or the tenets of faith,’’ see Jones,443 U.S. at 602, 99 S.Ct. at 3025, particu-larly as the bylaws provide the methodolo-gy for the Corporation’s board to identifythe ‘‘Bishop’’ for the Corporation’s pur-poses.
[66] However, the bylaws were amend-ed on August 15, 2006, when there wasonly one ‘‘body now known as the Episco-pal Diocese of Fort Worth,’’ from whichlay and clergy members of the board weredrawn and the bishop identified, and thatbody was affiliated with TEC. [Emphasisadded.] Over two years later, on Novem-ber 15, 2008, Appellees voted to leaveTEC. The schism gave rise to two distinctentities: one recognized by TEC as theEpiscopal Diocese of Fort Worth and oneself-identified by Appellees as such. Thebylaws and articles do not provide a de-scription of the characteristics of the dio-cese self-identified by Appellees, but theydo require that elected trustees be eitherlay persons in good standing of a parish ormission, or canonically resident, in the en-tity identified by the Corporation’s boardas ‘‘the body now known as the EpiscopalDiocese of Fort Worth.’’ [Emphasis add-ed.] As set out above, it is within TEC’sprovince to identify its diocese in the geo-graphic area identified as Fort Worth andwhat it takes to be a member in good
443Tex.THE EPISCOPAL CHURCH v. SALAZARCite as 547 S.W.3d 353 (Tex.App.—Fort Worth 2018)
standing or canonically resident therein.Accordingly, on November 15, 2008, whenAppellees voted to disaffiliate, it wasTEC’s prerogative to determine whetherthe board members of the diocese formerlyassociated with TEC had become disquali-fied under the Corporation’s bylaws.
We conclude that the TEC-affiliatedEDFW controls appointment to the Corpo-ration’s board and therefore that the TECparties identified within the TEC-affiliatedEDFW have standing for these relatedcomplaints. We sustain the TEC parties’subissue 1(h).
Paralleling the complaints in their livepleading, the TEC parties refer us to TECcanon I.17.8, ‘‘Fiduciary responsibility,’’which refers to a TEC officer’s duty to‘‘well and faithfully’’ perform the duties ofthat office in the Church and to a layperson’s responsibility to be a communi-cant in good standing. They further referus to the ‘‘Declaration of Conformity’’ thatBishop Iker and ‘‘every dissident cleric’’signed, refer us to prior statements byBishop Iker and others in previous casesinvolving dissidents that could be read tocontradict Bishop Iker’s nouveau-dissidentposition here, and complain that the trialcourt allowed Bishop Iker et al. ‘‘to renegeon their promises, break their commit-ments, and breach relationships of trustand confidence as Church officers.’’
The TEC parties base their constructivetrust argument on the basis of a fiduciaryduty owed to them as the diocese andcongregations that remained loyal to TEC,asserting that Appellees ‘‘broke a centu-ry’s worth of oaths and commitments’’when they left and took the TEC-affiliatedproperty, resources, and name. They relyon IRS disclosures and assertions in otherlawsuits as a basis for estoppel. Based onour resolution above, however, we need not
address these arguments with regard toany of the TEC parties except for TECitself.
As to TEC, these arguments misplacethe measuring stick and would require usto delve into the mysteries of faith, when—on the face of the documents before us—procedure, not position, at least with re-gard to the causes of action that have notbeen severed out, determines the outcomeof this portion of the case. Specifically, thiscase does not turn on a breach of contractin the usual transactional sense. Indeed,the TEC parties did not bring a claim forany such breach of an actual contract.Instead, their causes of action were for
1 ‘‘Breach of Express Trust,’’ based on,among other things,
1 the November 13, 1982 subscriptionto TEC’s constitution and canons;
1 the June 29, 1984 petition in thefriendly lawsuit between the Dioceseof Dallas and EDFW; and
1 ‘‘the associational benefits of affilia-tion,’’ described as consideration andthe basis of a contractual trust;
1 ‘‘Constructive Trust—Conveyance,’’based on the exchange of property foraccession as consideration;
1 ‘‘Constructive Trust—Fiduciary Com-mitments,’’ based on a ‘‘confidential re-lationship with [TEC] and its subor-dinate entities’’ and commitments onhow they would hold the property;
1 ‘‘Estoppel,’’ which the TEC parties fur-ther clarify is actually ‘‘quasi-estoppel,’’based on some of the same actionsabove;
1 ‘‘Diocesan Trust’’ and ‘‘Congregation-level Trust,’’ based on the same ex-press and constructive trust argu-ments;
1 ‘‘Promissory Estoppel,’’ based on‘‘promises to [TEC] as a condition of’’EDFW’s formation, ‘‘receipt of disput-
444 Tex. 547 SOUTH WESTERN REPORTER, 3d SERIES
ed property,’’ and the same actions asrelied upon in their other claims;
1 ‘‘Conversion,’’ by unlawfully retainingand claiming property—sacramentaland liturgical instruments and materi-als, bank and brokerage accounts, mo-nies, valuable chattels, personnel rec-ords, financial records, real propertyrecords and deeds, and historical rec-ords—‘‘in a way that departed from theconditions under which it was re-ceived’’;
1 ‘‘Texas Business & [Commerce] Code§ 16.29,’’ for using EDFW’s tradenames and trademarks without permis-sion ‘‘and in a manner likely to dilutethe distinctive quality of the foregoingtrade names and marks’’;
1 ‘‘Breach of Fiduciary Duty,’’ with re-gard to Appellees’ ‘‘constitutional andcanonical obligations to the Diocese,the Church, and the Episcopal Parishesand Missions,’’ among other misfea-sance;
1 ‘‘Action to Quiet Title’’ with regard tothe disputed property on a table at-tached to their petition; and
1 ‘‘Trespass to Try Title,’’ with regard tothe same property in their quiet titleclaim.113
Of these, conversion, damages for breachof fiduciary duty, the action to quiet title
and for an accounting, and the claims un-der business and commerce code section16.29 were severed out of the instant caseand remain pending in the original action,cause number 141-237105-09.
[67] As to the claims not severed out,and as to the relief sought in the form of aconstructive trust, TEC relies on the ideaof a confidential relationship that is moreintimate than any kind generally consid-ered under our law outside of the divorcecontext. Just as the dissolution of a long-term marriage involving allegations of infi-delity and abuse can result in a messy,unpleasant divorce for all involved, like-wise, the disassociation of a faction withina religious entity can be (and, as here, hasbeen) equally messy and unpleasant foreveryone involved. Whether, in a religiousor personal sense, Bishop Iker and therest are the perfidious oath-breakers char-acterized by the TEC parties is not for usto determine because such questions areinextricably intertwined with First Amend-ment implications. To the extent TEC hasrights outside of the ones brought by theother TEC parties,114 we have not found alegal or equitable basis under our neutralprinciples analysis and the documents inthe record before us for imposing a con-structive or resulting trust. See McConnell& Goodrich, 58 Ariz. L. Rev. at 354(‘‘Courts that have applied ordinary princi-
113. They also sought declaratory and injunc-tive relief and an accounting.
114. Many of the assertions set out above per-tain to ecclesiastical matters. And much likethe end of a fiduciary duty between maritalpartners at divorce, when Bishop Iker et al.excised their faction from TEC, any fiduciaryduty obligations to TEC ended. See, e.g., In reMarriage of Notash, 118 S.W.3d 868, 872(Tex. App.—Texarkana 2003, no pet.) (‘‘Thefiduciary duty between husband and wife ter-minates on divorce.’’); Parker v. Parker, 897S.W.2d 918, 924 (Tex. App.—Fort Worth1995, writ denied) (‘‘While marriage maybring about a fiduciary relationship, such a
relationship terminates in a contested divorcewhen a husband and wife each have indepen-dent attorneys and financial advisers.’’), dis-approved of on other grounds by FormosaPlastics Corp. USA v. Presidio Eng’rs & Con-tractors, Inc., 960 S.W.2d 41 (Tex. 1998) (op.on reh’g). Jane R. Parrott, a financial recordscustodian, stated in an affidavit that all loansfrom TEC prior to the 2008 disaffiliation‘‘were fully repaid before that date.’’ Parrottalso attached a summary of the financial con-tributions and receipts between EDFW andTEC showing that EDFW had contributedmore than $2 million to TEC during the yearsof affiliation.
445Tex.GUERRA v. STATECite as 547 S.W.3d 445 (Tex.App.—Houston [14th Dist.] 2018)
ples of trust law have generally found thatinternal church rules and relationships failto create either a resulting trust or aconstructive trust.’’).
Accordingly, we overrule subissues 1(f)and (g) as they pertain to TEC; as to theremaining TEC parties, based on our dis-position of the associations, corporations,and trust questions above, we need notreach them. See Tex. R. App. P. 47.1.
IV. Conclusion
Based on all of the above, to the extentthat TEC has standing, we sustain its solestand-alone issue with regard to its ecclesi-astical determination of which entity con-stitutes EDFW but overrule its portion ofthe TEC parties’ subissues (f), (g), and (j)as they pertain to the issues in this appeal.
We sustain all of the TEC parties’ subis-sues (a), (b), (h), and (i). As to all of theTEC parties except for TEC itself, wesustain in part subissues (c), (e), (j), and(k) and do not reach subissue (d) or theremaining TEC parties’ subissues (f) and(g). We thereby hold as follows in responseto the questions directed on remand by theSupreme Court of Texas:
(1) Appellees’ actions, as corporatetrustees, were invalid under Texaslaw after disaffiliation in 2008.
(2) Under Texas Corporations Law,the articles of incorporation and by-laws at issue were amenable toamendment but the plain languageused in 2006—‘‘now known as’’—prior to disaffiliation in 2008 meansthat the TEC-affiliated EDFW con-trols appointment to the Corpora-tion’s board.
(3) To the extent that the Dennis Can-on could be construed as attempt-ing to create a trust, it did notimpose one on EDFW’s property infavor of TEC.
(4) Equitable title to the property inthe 1947 deed is held for the TEC-affiliated EDFW; the Corporationholds legal and equitable title to theproperty in the 1950 deed.
(5) Based on the above, all of the TECparties except for TEC have stand-ing to bring the above claims thatare not barred by ecclesiastical ab-stention, and on remand, TEC mayhave standing with regard to someof the severed claims.
Accordingly, we affirm in part and re-verse in part the trial court’s judgmentand remand the case to the trial court forfurther proceedings not inconsistent withthis opinion.
GABRIEL, J., concurs without opinion.
,
Eric GUERRA, Appellant
v.
The STATE of Texas, Appellee
NO. 14-17-00202-CR, NO. 14-17-00203-CR
Court of Appeals of Texas,Houston (14th Dist.).
Opinion filed April 10, 2018
Background: Defendant was convicted inthe District Court, Harris County, of as-sault on a family member and violation of aprotective order arising out of a singlecriminal action. Defendant appealed thebill of costs.
Holding: The Court of Appeals, TracyChristopher, J., held that $10 and $20 wit-
TAB C
COURT OF APPEALS SECOND DISTRICT OF TEXAS
FORT WORTH
NO. 02-15-00220-CV The Episcopal Church, the Local Episcopal Parties, the Local Episcopal Congregations, and the Most Rev. Katharine Jefferts Schori v. Franklin Salazar and Intervening Congregations
§ § § §
From the 141st District Court of Tarrant County (141-252083-11) April 5, 2018 Opinion by Chief Justice Sudderth
JUDGMENT
This court has considered the record on appeal in this case and holds that
there was error in part of the trial court’s judgment. It is ordered that the
judgment of the trial court is affirmed in part and reversed in part.
We affirm that portion of the trial court’s judgment that ruled that the
Corporation of the Episcopal Diocese of Fort Worth holds legal title to all
properties listed on the trial court’s Exhibit 1.
We reverse that portion of the trial court’s judgment that ruled that
beneficial title to 5001 Crestline, Fort Worth, Texas, is held by Appellees and
render judgment that beneficial title to 5001 Crestline is held by the “Episcopal
Diocese of Fort Worth” affiliated with Appellant The Episcopal Church.
We reverse that portion of the trial court’s judgment that ruled that
beneficial title to 5003 Dexter, Fort Worth, Texas, is held by Appellees and
render judgment that legal and beneficial title are joined and held by the
Corporation of the Episcopal Diocese of Fort Worth.
We reverse the remainder of the trial court’s judgment and remand this
case to the trial court for reconsideration in light of this court’s opinion.
Appellees Franklin Salazar and Intervening Congregations shall pay all of
the costs of this appeal, for which let execution issue.
SECOND DISTRICT COURT OF APPEALS By /s/ Bonnie Sudderth Chief Justice Bonnie Sudderth
TAB D
Amendment I. Establishment of Religion; Free Exercise of..., USCA CONST Amend....
United States Code AnnotatedConstitution of the United States
AnnotatedAmendment I. Religion; Speech and the Press; Assembly; Petition
U.S.C.A. Const. Amend. I-Full text
Amendment I. Establishment of Religion; Free Exercise of Religion; Freedomof Speech and the Press; Peaceful Assembly; Petition for Redress of Grievances
Currentness
Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridgingthe freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Governmentfor a redress of grievances.
<Historical notes and references are included in the full text document for this amendment.>
<For Notes of Decisions, see separate documents for clauses of this amendment:>
U.S.C.A. Const. Amend. I-Full text, USCA CONST Amend. I-Full textCurrent through P.L. 115-231. Also includes P.L. 115-233 to 115-243. Title 26 current through P.L. 115-244.
