Presbytery of Riverside v. Community Church of Palm Springs

In Presbytery of Riverside v. Community Church of Palm Springs (1979) 89 Cal.App.3d 910, the local church had been incorporated under California law, and title to its property was held in its own name. On the local church's secession from the general church with which it had theretofore been affiliated, the general church sought to obtain ownership and possession of the local church property, relying on those rules of the general church which state that whenever a local church has been formally dissolved or abandoned, its property reverts to the general church. The general church was organized along hierarchical lines and had been given specific authority to supervise certain business activities of local affiliated churches. The rules of the general church contained provisions, similar to those in the canons at bench, which required a local church to obtain permission to sell or mortgage its real property. The trial court ruled in favor of the local church. On appeal, the appellate court concluded that the hierarchical theory set out in 1872 by Watson v. Jones, 80 U.S. 679 does not apply in California, that state courts in California adjudicate disputes involving ownership or right to possession of church property on the basis of neutral principles of law. The court rejected the general church's contention that the property of a local church which is part of a general hierarchical church is held in trust as a matter of law for the benefit of the general church. (P. 925.) The court also rejected the claim that the general church and its congregants were, as a matter of law, the beneficiaries of an implied trust. It noted that the statement in Watson v. Jones, supra, "trustees obviously hold possession for the use of the persons who by the constitution, usages and laws of the Presbyterian body, are entitled to that use" leaves unanswered the vital question of the identity of the persons entitled to such use. It held that the critical determinations in such causes are not determinations of law but those of fact. (P. 927.) The court then concluded that, despite the rules of the general church that on dissolution of the local corporation all property reverts to the general church, in instances of disaffiliation for reasons of doctrinal controversy legal title to church property is the controlling factor. On the basis of neutral principles of law, the appellate court upheld the trial court's ruling that ownership and possession of the disputed church property remained with the local church.