When a Church Leaves a Denomination, Who Gets the Property?

In 2006, following years of conflict over issues such as human sexuality, the role of men and women in ordained ministry, and liturgical reform, a majority (96%) of the members of a local Episcopal church in Falls Church, Virginia, voted to leave the U.S. Episcopal Church but still remain in communion with other Anglican Churches around the world (the parish ultimately joined the Anglican Church in North America in 2013). After a lengthy court battle the church's property was awarded to the national denomination rather than the local church. The court based its decision, in part, on a provision in the national U.S. Episcopal Church's constitution that states that church property belongs to the national denomination not the local church. Interestingly, though, this provision was put into place long after the Falls Church parish was founded in 1732 (and without the assent of the Falls Church congregation). In fact, the Falls Church congregation was founded 50 years before the national Episcopal Church was established in 1789. 

Thus, there is an argument to be made that the local congregation had more of a right to the property than did the national denomination, but clearly the Virginia state court did not see it that way. If the Falls Church congregation had been located in another state, it might have won. In fact, state courts are split over this issue.

This is the topic of a recent Research on Religion podcast ("Michael McConnell on Church Property Disputes"). It features professor Michael McConnell of Stanford University, who has recently penned with another professor of law (Luke Goodrich) a law review article on the topic ("On Resolving Church Property Disputes"). Here is a summary of the podcast (from the Research on Religion website):

When a congregation splits from a denomination, what becomes of the church property? More specifically, how have US state courts wrestled with the issue of religious property disputes while trying to preserve the autonomy of church doctrine? Prof. Michael McConnell (Stanford Law School) answers these questions in historical context. He notes how judicial decisions have changed from the traditional “English Rule” favoring hierarchical denominations over congregations, to perspectives that are less intrusive into the internal doctrine and organization of a faith, nothing that there is still a great deal of ambiguity in the law. He argues for an approach known as “strict neutral principles” of resolving property disputes, noting that this mitigates the need for courts to meddle in, or determine, what it proper church doctrine and organization. He contrasts this approach with “hybrid” approaches that oftentimes yield greater uncertainty in ownership and discourage investment. Several examples of actual court cases are referenced throughout the interview.

The podcast can be downloaded from iTunes or listened to at the Research on Religion website ("Michael McConnell on Church Property Disputes").