Authored by Derek B.M. Ross.Editor's note: Click here for an update on this case. In a recent decision that will be of interest to churches and denominations across the country, Ontario’s highest court has weighed in on a number of important legal questions, including: Who owns a charity's assets in a parting of ways? Who decides what a "congregation" is? And who should bear the legal costs once these questions are answered? The case and its implications for charities are discussed in this article.
BackgroundOn September 4, 2013, the Ontario Court of Appeal released its decision in Delicata v. Incorporated Synod of the Diocese of Huron.[i] That case involved a dispute between the Anglican Diocese of Huron (the “Diocese”) and the membership of St. Aidan’s Anglican Church in Windsor, Ontario (the “St. Aidan’s Group”). The case involved what the court described as “profound and long-standing theological differences relating to Biblical interpretation and the authority for Anglican doctrine found in the Scriptures.” Ultimately, a decision was made by the St. Aidan’s Group, catalyzed by the Diocese’s decision to bless same-sex unions, to leave the Diocese. As a result of this parting of ways, the question arose as to who owned the church property in Windsor, as well as a charitable foundation established and maintained by St Aidan’s members. The matter made its way to court, where the trial judge focussed on the interpretation of the Diocese’s canons, particularly Canon 14, which stated that the Diocese holds all real property “in trust for the benefit of the Parish or congregation.”[ii] The issue turned on the interpretation of the phrase “Parish or congregation”. The St. Aidan’s Group argued that a parish is a fluid concept that describes the people who comprise the congregation at any one time. The Diocese argued that a parish is a static concept that continues in perpetuity regardless of changes in membership, and submitted that while members of the parish may choose to leave, “the parish continues in perpetuity to be the responsibility of the Bishop of the Diocese in which it is geographically located.”[iii] The trial judge agreed with the Diocese, concluding: “Members can come and go in a parish at any time, but the parish itself remains.”[iv] The trial judge determined that the church property would remain with the Diocese, and the St Aidan’s Group appealed to the Ontario Court of Appeal.
DecisionOn appeal, the Ontario Court of Appeal agreed with the Diocese and the lower court, and rejected what it described as the “snapshot theory” of a parish:
“[T]he words ‘Parish or congregation’ must denote a static entity that may not be severed from the Diocese and that is not defined by any particular group of members at any particular time.”[v]The Court was influenced by the Anglican Church’s Canons and incorporating legislation, which both stated that church property could not be sold, mortgaged, or otherwise disposed of without the Bishop’s consent. The Court interpreted this to mean that the Bishop (and by extension the Diocese) retained control over all church property in perpetuity for the benefit of the Diocese. Permitting the property to be distributed “at the will of a single group of estranged congregants” would, in the view of the Court, wholly undermine this objective.[vi] The court also noted that to allow “any group of worshippers who [meet the minimum membership requirements] and...by majority vote, leave the Diocese and take the church property with them” would clearly be contrary to “what the canons intended.”[vii] The St. Aidan’s Group also argued that, if they could not keep the church building, the Diocese would be unjustly enriched because funds for the church’s land and building, including an addition in the 1990’s that cost $610,000, were raised “entirely by the church members”. However, the Court rejected this argument as well, concluding:
“The congregants who contributed money or labour to maintaining the church property knew they were doing so for the benefit of St. Aidan’s Parish of the Diocese of Huron. It must be inferred that they also knew what the canons and statute stated.”[viii]...
Noteworthy is provided for general information purposes and does not constitute legal or professional advice. Every organization’s circumstances are unique. Before acting on the basis of information contained in this blog, readers should consult with a qualified lawyer for advice specific to their situation.