GA involvement revealed
Legal fees may lead presbytery
from one court to another
By Parker T. Williamson, The Layman, October 15, 2009
BATON ROUGE, La. – The Presbytery of South Louisiana (PSL) will be out of money sometime during the year 2010, according to the Rev. Theodore Roeling, Sr., former treasurer of the organization.
Roeling made that statement under oath during a court hearing on March 3, 2009. At that time, he testified that the presbytery was facing a 2009 deficit of approximately $207,000 and had approximately $545,000 left in its operating reserve account. When asked to predict when the reserves would be depleted, Roeling stated: “I don’t think we can go beyond 2010.”
Roeling was fired, along with the Rev. Alan Cutter, South Louisiana’s general presbyter, shortly after he made the dire prediction. Also excised from the presbytery staff were the positions of assistant to the general presbyter, communications assistant and assistant to the treasurer. Citing the costs involved, PSL has decided not to have its books audited by a certified public accountant, choosing the cheaper route of contracting for “accounting services” with the staff of the Synod of Lakes and Prairies.
“To chart the course for a new direction for PSL,” the personnel committee has hired an “office administrator … with experience in office management,” according to a report that it filed with the presbytery. But in the aftermath of five firings and a one-third time reduction that was negotiated with the custodian, one wonders who is left for the manager to manage.
Legal fees soar
At a presbytery meeting on Oct. 9 and 10, the finance committee announced that its deficit for the first eight months of 2009 had grown to $244,000 and was climbing fast, due primarily to the cost of PSL’s lawsuits against one of its congregations, the 20-member Carrollton Presbyterian Church in New Orleans. PSL’s legal bills were $96,700 in 2008 and $144,000 through August 2009, most of which was spent on the Carrollton litigation.
The Carrollton case logged multiple courtroom hours in September and October with the prospect of more to come that may add more than $50,000 in attorney fees by the end of the year.
In its October report, the finance committee said that PSL’s operating reserves account has dwindled to $349,000. Outstanding (September and October) attorney fees and open-ended legal costs that will be incurred during the balance of the year promise to deplete much of what remains in PSL’s reserves. The committee anticipates additional deficit spending of at least $61,000.
Burdens from above
Part of PSL’s deficit is due to the fact that several of its evangelical and formerly generous congregations have left the Presbyterian Church (USA). Several remaining congregations have drastically cut their giving to higher governing bodies, so income is dramatically down. But, by the finance committee’s own admission, the chief culprit in PSL’s budget crisis is its lawsuit against the tiny Carrollton church.
PSL’s crippling legal expenses are not entirely of PSL’s own making. “Council is reminded,” said the finance committee in its October report, “that all matters of property are under the jurisdiction of the synod administrative commission, and final decisions are made by them.” PSL is saying, in other words, that a higher governing body, the Synod of the Sun, is ultimately calling the shots in the Carrollton lawsuit, but PSL must pay the bill.
According to PSL’s documents, “the synod and Louisville have contributed a total of $25,000 towards the cost of this lawsuit,” but that is a drop in the bucket for a continuing case whose expenses to date have cost PSL more than $240,000.
‘Please explain what we gain’
The Layman has learned from sources present during the Oct. 9-10 meeting, that after the PSL’s council requested PSL to increase its budgeted legal expense line item to cover past and anticipated attorney fees, a motion was made from the floor to call for a time out. It was moved that PSL terminate its lawsuit against Carrollton “until the synod can explain to our presbytery what the presbytery gains by continuing this lawsuit.”
During the parliamentary skirmish that ensued, a motion was made to refer this matter to PSL’s attorney. Objections were raised that the attorney has a pecuniary interest in the case that would obviate his objectivity in advising whether the case should be continued.
But others argued that “we need to be team players,” and if synod and General Assembly officials believe the case is worth pursuing, PSL should go along with them. Supporters of the “team” argument also assured PSL that they had an agreement from Synod of the Sun officials that the synod will pick up the tab of any appeal in the event that PSL loses in District Court.
The motion to refer was approved by a narrow 3-2 ratio, and audible expressions of unhappiness filled the room.
Why sue this 20-member church?
Among property law cases, this litigation is unique, in that the Carrollton church is a member congregation of the PCUSA that says it has no intention of leaving the denomination. At issue is Carrollton’s decision to sell its property to a Catholic school next door in order to facilitate the school’s classroom expansion. The plan includes Carrollton’s intent to continue using the sanctuary for its own Sunday worship services, even after the sale. Carrollton session members see this as a win-win arrangement: They will facilitate sound Christian education for New Orleans children while continuing to use the building for worship. Further, they can use the proceeds from the sale for their chosen ministries, and the Catholics will assume expensive maintenance costs.
All was well until PSL intervened, clouding Carrollton’s title and blocking the sale.
Southern church exemption
Carrollton was formerly a Presbyterian Church, US (southern) congregation, and, as did many southern churches, it voted for an exemption from the requirement that it gain presbytery permission to purchase, sell or otherwise encumber its property. Based on the language of that exemption, Carrollton believes that it is entirely permissible for the congregation to sell its property to the school next door, and that PSL has no right to intervene.
PSL argues that Carrollton’s “real intention” is to leave the denomination with its property or to dissolve itself without presbytery involvement – acts that PSL believes are forbidden by the denomination’s trust clause. In documents filed with the 19th Judicial District Court, Carrollton has denied that it has any of these intentions, and PSL has cited no evidence to substantiate its suspicions.
Synod of the Sun intervenes
In 2008, after PSL allowed three vital congregations to leave the denomination with their property, the Synod of the Sun created an administrative commission and gave it the power to veto or approve all PSL decisions involving property. In PCUSA law, this is not assuming original jurisdiction over PSL, but it does mean that in church property cases, the synod administrative commission’s approval is required before PSL property decisions become final.
Early in the game, the synod administrative commission moved against Carrollton with a heavy hand. Despite the fact that Carrollton had obtained a protective Temporary Restraining Order (TRO), the synod tried to dissolve Carrollton, thereby paving the way to confiscate its property. On the brink of a contempt of court judgment for its having defied the TRO, the synod got PSL lawyers to move the case to Federal Cou
rt, but the Federal Court declined to accept the case and sent it back to the district court.
Facing the possibility that they might be cited for contempt, synod representatives argued that Carrollton was not their case, but PSL’s case, and that they were merely advising PSL. But PSL argues that it cannot take any property-related action without the consent of the synod, so it’s a synod case. In a classic “that woman whom you gave to me gave me the apple and I ate it” fashion, PSL and synod have danced an accountability jig before the judge.
Lifting the veil
Sensing opportunity, Carrollton’s lawyers filed subpoenas, demanding that PSL’s lawyers turn over all correspondence between themselves and the synod, and correspondence with anyone else who may be involved in this case. PSL refused, claiming “attorney-client” and “work product” privilege. But Carrollton’s attorneys argued that only PSL is listed as a party in this case, so while correspondence between PSL and its attorneys may be privileged, any correspondence that they have shared with the synod that insists it is “not a party” or other individuals who are outside the attorney-client relationship is not covered and must be revealed.
PSL ordered to comply
On Sept. 22, the court agreed with Carrollton, and it ordered PSL to turn over any and all of its correspondence with the synod and others, giving it six hours to comply with the order. “Failure to abide by this order may result in the party in violation being held in contempt and the imposition of penalties by this court,” said the order.
PSL then produced a 44-page “Defendant’s Privilege Log,” listing 445 pieces of correspondence, redacting three and withholding the rest. PSL attorneys continued to contend that the content of this correspondence is “attorney/client related” and therefore “withheld” because it is “privileged,” the same argument that they had made earlier and that the court had rejected.
On Oct. 9, Carrollton attorneys filed a “motion for contempt and penalties,” citing the court’s Sept. 22 order and PSL’s continued refusal to comply.
‘Wizard’ unveiled
The Defendant’s Privilege Log is, in itself, revealing in that it identifies backstage players in this lawsuit. Of the 445 pieces of correspondence listed in the log, 398 bear the name of attorney Mark Tammen, director of constitutional services, Office of the General Assembly, PCUSA. Tammen was an author of “The Louisville Papers,” memoranda advising presbytery leaders on how to handle church property disputes. Included in his advice was that presbytery officials take possession of local church property, change the locks, freeze bank accounts, defrock uncooperative ministers, remove the session and move the case toward judges who are members of hierarchical churches.
Tammen’s 398 entries in the Carrollton case log clearly lift the curtain on the denomination’s “Wizard of Oz.” The Office of the General Assembly’s surreptitious involvement in many court cases across the country has long been suspected, but this log provides substantial evidence that bolsters that suspicion.
A painful lesson
PSL now finds itself on shaky ground. The General Assembly and the Synod of the Sun are currently outside the 19th District Court’s jurisdiction, so presumably, they cannot be made to pay for being in contempt. But PSL can. A contempt of court judgment and related penalties could make a serious dent in this deficit-ridden presbytery’s dwindling reserves. Making matters worse, Carrollton has filed a sanctions case against PSL for the damage that its litigation has done to its congregation, asking that the court require PSL to reimburse Carrollton for needless litigation expenses it has incurred.
By any calculation, the synod’s intervention and Louisville’s involvement has cost PSL dearly. And if these two “higher” governing bodies demand that PSL pursue an appeal, it can only get worse.
What’s behind this lawsuit?
One may ask why PSL is being pushed to exhaust its some $300,000 in assets, not to mention the possible imposition of court-ordered penalties and sanctions, in the Carrollton litigation. Why has the Office of the General Assembly and the Synod of the Sun unleashed so much firepower over the property of this 20-member church?
The answer probably lies in precedent. If Carrollton can sell its property without presbytery approval, so can any of the thousands of former southern Presbyterian congregations that exercised the exemption clause within eight years of denominational reunion. If while acting as a PCUSA church, a congregation has an unconditional right to dispose of its property with only the congregation’s approval, this means that no third party, like a presbytery, can decide on the disposition of that same property. The denomination’s trust clause is thereby negated.
From one court to another
Refusing to cower before a presbytery/synod/GA triumvirate whose arsenal includes the work of 12 lawyers hailing from Louisiana to Louisville via New York City, this tiny New Orleans congregation is delivering a crippling blow to its ecclesiastical bully.
PSL’s building that once housed five offices now echoes its emptiness, peopled only by an office manager and her one-third-time custodian. Burdened by a red-ink budget and exhausted reserves, PSL may struggle for years to climb out of the crater carved by mandates from denominational officials.
Ironically, PSL’s penchant for the court room has pushed it toward a tribunal that it did not intend to enter. The next gavel that it hears may be wielded by a bankruptcy judge.