The American Lawyer - February 2008

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DOGMA FIGHT
Big firms litigate a rift in the Episcopal Church.

4INCE LAST FALL, A trio of Am Law 100 firms have been embroiled in a trial in state court in Fairfax, Virginia, that is considered the largest church property litigation of modern times.

With tens of millions of dollars at stake, the case pits 11 breakaway congregations, represented by Winston & Strawn, against the Episcopal Church and its Virginia diocese, represented by Goodwin Procter and Troutman Sanders, respectively.

Winston & Strawn’s clients severed ties to the national church in December 2006, part of a wave of conservative congregations that believe the national church is headed in an increasingly progressive direction, as exemplified by the 2003 consecration of a gay bishop in New Hampshire.

Under Virginia law the breakaway churches had to file a peti-

tion in state court announcing their intention to leave the main church. The church and diocese responded with a suit arguing that the runaway congregations had to surrender all their property and assets, which, according to church canon, are held in trust for the national church and do not belong to individual congregations. “The parish is an inextricable part of the church, and the people sitting there can’t just take it away,” says Goodwin partner Heather Anderson.

“The congregations are entitled to the property they spent blood, sweat, and tears building and maintaining over the years,” replies Winston & Strawn partner Steffen Johnson, lead counsel for the breakaway churches. “The notion that the Episcopal Church can claim ownership to all these properties that were built with the congregation’s money is a bit much.”

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A bench trial last fall—the first of two in the dispute— addressed the churches’ power to declare themselves free of the national church under a Civil War–era statute that says majority rule should govern ownership in the event of a split. Testimony concluded in November; posttrial briefing was under way at press time. The claims of the national church and the Virginia diocese will be vetted in a second trial, which has not yet been scheduled.

The same ownership is-

sues, meanwhile, are playing out in courtrooms across the country—with the national church prevailing in all but one case. (The only ruling in favor of a breakaway congregation, by a California state court judge, was overturned on appeal; that case is now before the California Supreme Court.)

But leaders in the movement believe that it will become harder for the Episcopal Church to hold on to its property as more congregations—including the entire San Joaquin diocese in California—walk away.