Petition — United Methodist Church v. Barr

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AUG 14 1979

__MIOHABL RODAK, JR., CLERK

IN THE

Supreme Court of the Anited States

OctToBER TERM, 1978

FRANK T. BARR, et al.,

Plaintiffs,

vs.

THE UNITED METHODIST CHURCH, et al,

Defendants.

PETITION FOR WRIT OF CERTIORARI TO THE

COURT OF APPEAL, STATE OF CALIFORNIA

ALBERT KE. JENNER, JR. SAMUEL W. WITWER, Sr.

Kets F.. Bopr SAMUEL W. WITWER, JR.

Evucene R. WEDOFF Wrrwer, Moran, Burwacz &

JENNER & BLock ATKINSON

One IBM Plaza 125 S. Wacker Drive

Chicago, IL 60611 Chicago, IL 60606

(312) 222-9350 (312) 332-6000

Awan J. RENICHE

Danrev R. Savas

Wruw F. Fanry

SuLuivan, Jones & ARCHER

1400 Financial Square

600 ‘B’ Street

San Diego, CA 92101

(714) 236-1611

SASS ARR BONE BATE OE TOOL ES SINS LE TIS: OE AN SORES AOL AACN

La Salle Street Press — Chicago Printed in U.S.A.

oo ne nomena

TABLE OF CONTENTS

PAGE

ee acs ike ee ee ts cous ese 2

ES eee 2

COUR OUPEte EF EREMOEUNN LEED . 0. ccc cc ceccccceses 2

CONSTITUTIONAL PROVISIONS AND STAT-

EE 3

RELATED MATTERS PENDING BEFORE THIS

ENE Er 4

STATEMENT OF THE CASE .................... 4

! ee OE ccc cn wcescccces 4

B. Allegations Concerning The United Methodist

Church and Motion to Quash and Dismiss ...... 6

C. Evidence Regarding The United Methodist

EOS ee 7

EES SEE 15

REASONS FOR GRANTING THE WRIT .......... 17

I. Section 388 of the California Code of Civil Pro-

cedure Cannot, Consistent with Due Process, be

Interpreted to Allow an Action for Damages to

be Brought Against an Aggregation of Persons

and Entities Who Hold No Common Assets, and

Who Have No Centralized Management ........ 19

A. The Rule of Law Applied By the Court of

RiGee waey ara d he sess ces escas ve 22

| B. Fact Finding by the Court of Appeal ...... 28

II. Section 388 of the California Code of Civil Pro-

eedure Cannot, Consistent with the Constitu-

tional Guaranty of Free Exercise of Religion, be

Interpreted to Render Liable to a Suit for Dam-

ages a Religious Denomination Composed of

Many Separate Entities with No Unified Author-

itarian Structure, Managing Board or Executive

Officers and No Joint Denominational Assets ... 36

Es bigs wade be hss 0sccesceces 39

TABLE OF APPENDICES (A-1 through A-39) ..... A-1

TABLE OF AUTHORITIES

Cases

PAGE

Bancroft-Whitney Co. v. McHugh, 166 Cal. 140 (1913) 28

Brady v. Reiner, 198 S.E. 2d 812 (W. Va. 1973) ...... 31

California Clippers, Ine. v. United States Soecer Foot-

ball Assn., 314 F.Supp. 1057 (N. D. Cal. 1970) ...... 22

Cox Broadcasting Corp. v. Cohn, 420 U.S. 469 (1974) .. 34, 35

Hall v. Bureau of Employment Agencies, 64 Cal. App.

3d 482 (1976), cert. denied, 97 S.Ct. 2187 (1977) .... 28

Hansherry v. Lee, 311 U.S. 32 (1940) ..............2.. 27

Hidden Lake Development Co. v. District Court, 183

Cole, 165; SID F. 20 GEE CIGIS) «ccc nccsccecceas 22

Jardine v. Superior Court, 213 Cal. 301, 2 P.2d 756

SD er re a al Cpa Ma Me ave ey wen PARES ea 19, 20, 21, 23

Jones v. Wolf, US. ,47 U.S.L.W. 4962 (July 2,

GR Cowie Ue ee eee wnaau hee kuaae es 37

Kedroff v. St. Nicholas Cathedral, 344 U.S. 94 (1952) . 36

McClure v. Salvation Army, 460 F.2d 553 (5th Cir.

UN LT un AS Rogie boa F ANOS OA RRA LAR ENNAT CAS OS 36

McCorkle v. City of Los Angeles, 70 Cal. 2d 252, 449

P.2d 453, 74 Cal. Rptr. 389 (1969) ......cccecceces 35

Mullane v. Central Hanover Trust Co., 339 U.S. 306

2 EARNS Nets mere ra) peee earie se Panny haces 25

NLRB v. Catholic Bishop, US. , 47 U.S.L.W.

Se Bais BEE D ecko chawoesecusateasweeees 36

North Dakota State Board of Pharmacy v. Snyder’s

Drug Stores, Inc., 414 U.S. 156 (1973) ............. 35

Penrod Drilling Co. v. Johnson, 414 F.2d 1217 (5th Cir.

SR ack d eet ecKee hk ab kees cence ERR ee 22

Roman Catholie Archbishop v. Superior Court, 15 Cal.

App. 3d 405, 93 Cal. Rptr. 338 (1971) .............. 38

Serbian Eastern Orthodox Diocese v. Milivojevich, 426

ie YS et | ere nr res ry rh Ore 36, 37

nal

PAGE

Steuer v. Phelps, 41 Cal. App. 3d 468, 116 Cal. Rptr. 61

| RENE ee iE gare Pe ere pT St Meat LN igs 21

Charles W. Trigg, et al. v. Pacifie Methodist Invest-

ment Fund, et al., No. 78-0198-S (S.D. Cal., filed

NS EE SS aaesa ety eee ese 4, 7, 24

The United Methodist Church v. St. Louis Crossing

Independent Chureh, 150 Ind. App. 574, 276 N.E. 2d

SCRE ies Opener wea ieee awbawel 30

United Mine Workers v. Coronado Coal Co., 259 U.S.

Pe ice rh dU R ESR ye et eh we ia ks 20, 21, 23, 24

Wisconsin v. Yoder, 406 U.S. 205 (1972) ............. 38

Yonce v. Miners Memorial Hospital Assn., Ine., 161 F.

ane RTO CWT. VG. TOUR) nnn coc cc cdaccccccuies 22

Statutes and Constitutional Provisions

United States Constitution, First Amendment ....... 3, 36-38

United States Constitution, Fourteenth Amendment .. 3, 36

United States Code, Section 1257(3) ................ 2, 34

California Code of Civil Procedure, Section 388 ..... 19, 36, 38

California Code of Civil Procedure, Section 418.10 ... 34

Federal Rules of Civil Procedure, Rule 17(b) ....... 4, 22

Miscellaneous

The Book of Discipline of the United Methodist

ae eae orcad ee aa 8-12, 14, 25-26, 28, 29

er Ms Wl ok nl ve acu ws ou au edna oxean 35

eR rs ee 6 OE, BE ois hia ac kc eek beedeancacs 35

7 C.J.S. Associations § 1 (1937) .......... 0c. ccc 22

Note, 75 Harv. L. Rev. 1142 (1962) ................. 31

Bishop Roy Short, United Methodism in Theory

lee NU ED ores ee oe 30

Bishop Jack M. Tuell, The Organization of the United

Methodist Church (rev. ed. 1977) ................ 13, 14

PR Maken nee 1 -s -28

IN THE

Supreme Court of the Gnited States

OcroBER TERM, 1978

FRANK T. BARR, et al.,

Plaintiffs,

vs.

THE UNITED METHODIST CHURCH, et al,

Defendants.

PETITION FOR WRIT OF CERTIORARI TO THE

COURT OF APPEAL, STATE OF CALIFORNIA

To the Honorable Chief Justice and Associate Justices

of the Supreme Court of the United States:

The Petitioners, Charles F. Golden, Paul W. Milhouse

and James M. Walton-Myers, being the persons upon whom

service of process was attempted in the name of the entire

international religious denomination known as the United

Methodist Church, a named defendant in the underlying

action, pray that a Writ of Certiorari issue to review the

judgment of the Court of Appeal, State of California,

Fourth Appellate District, entered on March 8, 1979. That

judgment reversed a March 20, 1978 decision by the trial

court, which had quashed service of process on the Peti-

tioners and dismissed the United Methodist Church as a

party defendant.

OPINIONS BELOW

The judgment and opinion of the Court of Appeal, pub-

lished at 90 Cal.App.3d 259, 153 Cal.Rptr. 322, is reproduced

as Appendix (“App.”) A to this Petition. The Minute

Order decision of the trial court, entered March 20, 1978

and reversed by the Court of Appeal, is reproduced as

App. B.

JURISDICTION

The California Supreme Court refused to grant a hearing

to review the Court of Appeal’s decision on May 17, 1979.

See order included as App. D. This petition was filed within

90 days of that date. This Court has jurisdiction to review

the Court of Appeal’s judgment by Writ of Certiorari

pursuant to 28 U.S.C. § 1257(3).?

QUESTIONS PRESENTED

This is one of a series of California cases, brought by

the same plaintiffs or related parties, against “The United

Methodist Church” seeking an aggregate of over one-half

billion dollars in damages. This is the first time in history

that a major international religious denomination has been

held to be suable as an “unincorporated association”. The

case raises the following questions regarding the validity

under the United States Constitution of state procedures

regarding suits against such associations:

1. Can a California procedural statute relating to “un-

incorporated associations” be applied, consistent with the

Constitutional guaranty of due process, to make amenable

to a suit for damages an international religious denomina-

tion which, as a totality, (a) has no officers, executive board,

or other decision-making mechanism, so that there is no

1 The finality required by 28 U.S.C. § 1257 is discussed at pp. 34-

35, infra.

person or body able to consult with counsel, plead, respond

to discovery, or otherwise speak for the denomination in

the course of the litigation and (b) holds no assets of any

kind, so that a judgment against the denomination could

be recovered only from the assets of separate jural entities

bearing the denominational name?

2. Did the California Court of Appeal, by requiring the

United Methodist Church to conduct litigation as if it were

a unitary and quasi-corporate legal entity, based solely on

the Court’s own reading of Church documents, and con-

trary to expert testimony aud internal ecclesiastical inter-

pretation, interfere with the chosen government of the

denomination, in violation of the right of free exercise of

religion?

CONSTITUTIONAL PROVISIONS

AND STATUTE INVOLVED

This case involves the interpretation of the following

provisions :

1. The Fourteenth Amendment to the United States

Constitution, which provides in pertinent part:

“ec

. .. nor shall any State deprive any person of life,

liberty or property without due process of law .. .”

2. The First Amendment to the United States Constitu-

tion, which provides in pertinent part:

“Congress shall make no law respecting an establish-

ment of religion, or prohibiting the free exercise

thereof...”

3. Section 388 of California’s Code of Civil Procedure

which provides:

“(a) Any partnership or other unincorporated associa-

tion whether organized for profit or not, may sue and

be sued in the name which it has assumed or by which

it is known.

“(b) Any member of the partnership or other unincor-

porated association may be joined as a party in an

action against the unincorporated association. If ‘serv-

ice of process is made on such member as an individual,

whether or not he is also served as a person upon whom

service is made on behalf of the unincorporated asso-

ciation, a judgment against him based on his personal

liability may be obtained in the action, whether such

liability be joint, joint and several, or several.”

RELATED MATTERS PENDING

BEFORE THIS COURT

The essential issues raised in this petition are also raised

in the context of Rule 17(b) of the Federal Rules of Civil

Procedure in a petition for Writ of Certiorari, filed on

June 11, 1979, in Milhouse, et al., v. United States District

Court for the Southern District of California; Trigg, et al.,

Real Parties in Interest, No. 78-1855 (hereinafter “Trigg”’).

There, the United Methodist Church, named as a “control

person”, has been defaulted in a $5 million securities fraud

case for failure to answer and conduct litigation as though

it were a single party defendant. Petitioners respectfully

request that the instant petition and the petition previously

filed in Trigg be considered for consolidated review by

this Court.

STATEMENT OF THE CASE

A. Nature of the Litigation.

All of the actions pending in California against ‘The

United Methodist Church”, including the Trigg case, now

pending before the Court on Petition for Writ of Certiorari,

pertain to the financial difficulties of Pacific Homes, Inc.

(Pacific Homes), a California not-for-profit corporation

which has, for many years, operated a group of facilities

for the care of the elderly in California, Arizona and Ha-

waii. Many of the residents in the homes had entered into

“lifetime care contracts” with Pacific Homes whereby, in

5 th ary acl

exchange for defined payments, Pacific Homes agreed to

provide housing and care for the remainder of the resi-

dents’ lives.

On February 18, 1977, Pacific Homes petitioned for relief

under Chapter XI of the Bankruptey Act. Subsequently,

the proceeding was converted into a Chapter X reorganiza-

tion proceeding with a court-appointed trustee who has

since operated the Homes without any interruption in

services.”

The financial condition of Pacific Homes required changes

in the lifetime care contracts. In September of 1977, some

150 residents of Pacific Homes, purportedly on behalf of

its 1,900 residents, brought the present case seeking either

specific performance by all defendants of the contracts made

with Pacific Homes, or, alternatively, damages allegedly

caused by non-performance.

Because Pacific Homes is in proceedings under Chapter

X the Bankruptcy Act, plaintiffs are looking to other par-

ties, all of whom are strangers to the Pacific Homes

contracts, to pruvide this relief. The defendants include

four specified religious units within the United Methodist

denomination: the Pacific and Southwest Annual Confer-

ence of the United Methodist Church, a California not-for-

profit corporation, within whose geographic bounds the

Homes functioned as an annual conference-related ministry ;

the General Council on Finance and Administration of the

* During the pending Chapter X reorganization proceedings,

eash flow imbalances have stabilized, positive cash flow has been

achieved and there is no expectation of closure of the Homes. In

fact, the percentage of occupancy is increasing. To date, no resident

has been required to leave the Homes for inability to pay increased

rates. Contingency funds donated by concerned United Methodists

and others are available to meet hardship cases, should any arise.

Phillips Affidavit, Appendix exhibit B to Application for Stay

Pending Review on Certiorari (filed June 12, 1979).

United Methodist Church, an Illinois not-for-profit corpora-

tion (“GCFA”); the General Board of Global Ministries of

the United Methodist Church, a New York not-for-profit

corporation; and the Division of Health and Welfare Min-

istries of the United Methodist Church, an Illinois not-

for-profit corporation. Finally, Plaintiffs name as a defend.

ant “The United Methodist Church” (“the denomination”)

in its entirety.

No issue is raised here, nor was any raised below, con-

cerning the jural status of the four specifically named

church units or of any other specific units within the de-

nomination. All of the named units have appeared through

their own separate counsel, answered, complied with dis-

covery, and are prepared to defend on the merits. The issue

before this Court is confined to the additional effort to

name and sue generally the entire denomination as an

“gnincorporated association”.

B. Allegations Concerning the United aa

Methodist Church and Motion to Quash and Dismiss.

The Consolidated Complaint herein broadly describes

“The United Methodist Church” as:

“|. an unincorporated association doing business in

San Diego County, California, and consisting of numer-

ous persons, associations, and corporations which were

and are organized, and denominated and doing business

as conferences, boards, commissions, councils and

agencies.”

(Consolidated Complaint at Par. 2). In fact, as detailed

below, the denomination is composed of over 45,000 largely

independent units, and 10 million individual members, with-

out a common head, managing board, headquarters, or joint

assets. After so defining the denomination as a broad “unin-

corporated association” the Complaint goes on to allege

that the denomination is involved in a web of “alter ego”

eb . 0 beh ent 0 a

Seay ate! he te Rb matin Sw

or “agency” relationships with Pacific Homes and the other

named defendants.

In an attempt to obtain personal jurisdiction over the

denomination, plaintiffs served process upon the present

petitioners, Charles F. Golden, a bishop who presides over

the defendant Pacific and Southwest Annual Conference ;

Paul W. Milhouse, a former president of the denomination’s

Council of Bishops; and James M. Walton Myers, a former

Assistant General Secretary of the defendant GCFA.

Messrs. Golden, Milhouse and Walton-Myers, appearing

specially under Section 418.10 of the California Code of

Civil Procedure, moved to quash service upon them and

dismiss the Complaint, as against the denomination, for

want of personal jurisdiction, (1) because the denomination

does not have any quasi-corporate or unified structure or

centralized administration which would render it an “un-

incorporated association” amenable to suit under Section

388 of the Code, (2) because neither they, nor anyone else,

under the ecclesiastical law of United Methodism, is au-

thorized tu answer the Complaint, decide litigation issues,

or otherwise appear and speak for the entire denomination—

in fact, they are specifically forbidden to do so; and (3) be-

cause they personally had no authority to receive service

of process for the entire denomination. The petitioners did

not argue for any form of “religious immunity,” but rather

pointed out that any or all of the separate units composing

United Methodism are amenable to suit. This is essentially

the same position taken by the two persons chosen by plain-

tiffs to receive process in the name of the denomination in

the Trigg case.

C. Evidence Regarding the United Methodist Church.

As in Trigg, petitioners supported their motion to quash

and dismiss with the affidavits of several ecclesiastical

experts within the United Methodist Church, explaining

the non-authoritarian and decentralized features of the

denomination, and demonstrating that the denomination

has never conducted affairs as if it were a single legal

entity. Plaintiffs responded with an affidavit and chart

prepared by their attorney, presenting his personal inter-

pretation (a) of the ecclesiastical law and polity of the

denomination and (b) of several documents concerning

individual units of the denomination. The plaintiffs offered

no expert testimony of any kind to refute the statements

made by petitioners’ church experts in support of the

motion.

Petitioners’ expert evidence reflected the ecclesiastical

law of the United Methodist denomination, as officially

stated in The Book of Discipline of the United Methodist

Church (1976), the highest constitutional and legislative

pronouncement of the denomination. Declaration of Murray

H. Leiffer (January 6, 1978), Ex. H. Ex. AA thereto, 75;

Affidavit of Ewing T. Wayland (March 7, 1978), Ex. V.

Ex.H thereto; Affidavit of Paul Milhouse (January 5, 1978),

Ex. H, Ex. G theret¢, 73.2 The denomination as a whole

has never been incorporated. Ex. V, Ex. J thereto, {[ 5.

As detailed by T..e Book of Discipline, and explained in the

affidavits, the denomination is an aggregation of many

largely independent entities brought together in what is

called “a connectional structure.” See The Book of Disci-

pline, at 231. There are basically four types of entities

within the denomination, defined by the geographical scope

of their ministry.

1. First, there are approximately 39,000 local churches

affiliated with the United Methodist Church in the United

States, and another 4,400 outside this country. Leiffer dec-

laration, Ex. H, Ex. AA thereto, 10. Each local church is

3 “Ex.” refers to the exhibits contained in the jointly compiled

record on review consisting of the materials submitted to the trial

court regarding the motion to quash and dismiss.

responsible for its own financial and operating affairs. Id.

The affairs of each locai church are administered by an

Administrative Board acting as an executive agency. The

Book of Discipline, J{| 247-250. No local church has been

named as a defendant in the Barr ease.

2. Operating in a broader geographical area, there are

other church entities known as “annual conferences.” The

Book of Discipline, J 700-751. This term refers to a meet-

ing of clergy and laymen from many local churches in an

area, and also refers to the area from which they come.

There are 72 annual conferences within the United States

and 42 such conferences distributed throughout Europe,

Africa, and Asia. (These conferences are listed in App. F

at A-33 to A-36.) See Leiffer declaration, Ex. H, Ex. AA

thereto, {] 10. The members of the annual conferences regu-

larly meet once a year to review matters of common con-

cern, and to develop and support benevolent programs

within their boundaries. /d., 13. An example of such pro-

grams is provided by the Pacific Homes project which gave

rise to the present litigation; this was a ministry related to

the Pacific and Southwest Annual Conference. There are

several hundred annual conference related agencies, such as

hospitals, homes and orphanages, across the denomination.

The funds necessary for such annual conference programs

are soughtgirectly or indirectly from the local churches,

The Book of Discipline, 711, but an annual conference has

no power to bind financially the denomination or any church

unit associated with the denomination, other than itself. id.,

1 702(2).

The annual conferences are continuous bodies. They may

meet more than once a year and have interim governing

boards (id. 701(4)); they may incorporate (id. $701(1));

they each have a treasury and a treasurer (id. 717-718).

No argument has been raised in this lawsuit about the jural

status of the annual conferences or any other constituent

units of the denomination. In the Barr ease, only one annual

conference has been named as a defendant, the Pacific and

Southwest Annual Conference, a California non-profit cor-

poration. It has appeared and answered.

3. Next, in order of increasing geographical scope, are

fo-rteen “jurisdictional” and “central” conferences. The

Book of Discipline, {{] 620-652; Leiffer declaration, Ex. H,

Ex. AA thereto, §/ 21. One of their principal functions is the

election of bishops. Id., { 22. The bishops of the denomina-

tion ordain and appoint ministers to the local churches.

The Book of Discipline, 9] 514-515, and preside, without

voting, over annual conferences, whose direction the bishops

must follow, Leiffer declaration, Ex. H, Ex. AA thereto,

{ 22. The bishops of the denomination, active and retired,

compose the Council of Bishops, The Book of Discipline,

1525. This body is essentially a consultative group; it has

no power to speak for or control the denomination or to

commit any entity within the denomination to action. Leiffer

declaration, Ex. H, Ex. AA thereto, {/ 22; Milhouse affidavit,

Ex. H, Ex. G thereto, 7. Neither the Council of Bishops

nor any of the jurisdictional or central conferences has

been named as a defendant in Barr.

4. The national and global operations of the United

Methodist denomination are the concern of the remaining

denominational entities—the General Conference and “gen-

eral” boards. The Book of Discipline, J] 601-612. Every

four years, delegates elected by the annual conferences

assemble to form the General Conference, which serves as

a legislative assembly. Leiffer declaration, Ex. H, Ex.

thereto, § 18. The Book of Disctpline is the body of law en-

acted by the General Conference.* Only the General Con-

ference can speak for the denomination as a whole. The

4 The highest judicatory of the denomination, charged with in-

terpretation of The Book of Discipline, is the Judicial Council. The

Book of Discipline, {{] 60-63.

Book of Discipline, | 612(1). Successive General Confer-

ences have established various boards and councils to carry

out the work of the denomination on a worldwide basis.

There are presently 13 such “general” boards. Leiffer decla-

ration, Ex. 11, Ex. AA thereto, {] 20. All of these boards, and

most of their subsidiary units, are incorporated. Id. How-

ever, the General Conference itself is not a continuing body.

It meets quadrennially for approximately two weeks and

then adjourns, sine die. It has no offices, and no permanent

staff. Jd., 18. The General Conference may not delegate its

functions to any other unit within the denomination during

the four-year interval between its sessions. Decision No.

364 of Judicial Council, Ex. V, Exs. J, J-1 thereto.

The boards and councils established by the General Con-

ference to perform the denomination’s worldwide ministry

receive their funds from the voluntary contributions of 10

million individual members of the denomination, through the

local churches and annual conferences. About 941% percent

of the amounts donated by members of the denomination

remain at the local level, for use by the local churches and

annual conferences; the remaining 514 percent contributed

for world ministries, are identified as “general funds.” This

term does not denote unrestricted assets, but rather is

used to signify that the funds are destined for ministries

by the 13 “general” level agencies so designated because

they are related to the General Conference, as opposed

to some other sector of the denomination. Wayland Dep.

at 215-217, 236-237; Wayland Affidavit No. 1, Trigg App.

Ex. 2, 7. These funds are routed, under The Book of

Discipline to GCFA, one of the 13 general level boards

and an Illinois non-profit corporation. GCFA then acts as

conduit to distribute these funds, in the manner specifically

budgeted and directed by the General Conference. In this

activity it is on occasion referred to as rendering “central

treasury” services, but it is not the treasury or treasurer

of the entire denomination. Wayland Dep. at 231.

In fact, GCFA’s functions are essentially devoted to

servicing eight of its twelve sister general level boards, and

do not bring it into contact with the thousands of local

churches or the vast majority of other non-general units

composing the denomination. Wayland Dep. at 245-247;

Wayland Affidavit No. 1, Trigg, App. Ex. 3, 4. In carry-

ing out certain of its functions, GCFA sometimes works

with a second general level board, the General Council on

Ministries, which is charged with reviewing the Church’s

ministries. The Book of Discipline, { 1001-1005. There is no

question in this case about the jural, suable status of the

general level boards.® GCFA and two other such units, the

General Board of Global Ministries and the Health and

Welfare Division have been named as defendants in Barr.

All have appeared, answered, and provided extensive dis-

covery.

The evidence before the trial court demonstrated that

the church units listed above are interrelated and inter-

connected by a common faith and tradition, and by common

representation at various conferences. However, it also

showed that they operate with a high degree of independ-

ence. There is no chain of command linking these units nor

are the levels described above layered vertically in any

ascending order of authority or control. Rather, the basic

constitutional units in the denomination are the 114 annual

conferences, and no substantial changes in the organization

and constitution of the denomination can be adopted with-

out the concurrence of these conferences. The Book of Dis-

cipline, | 37, 64. In the use of their funds, the separate

annual conferences are not subject to the control of other

5 GCFA contested the “long-arm” jurisdiction of a California

court in the underlying case, General Council on Finance and Ad-

ministration v. Superior Court, No. 78-300 in this Court, cert.

denied, USS. , 99 S. Ct. 281, (1978), but has never

asserted that it was not a jural entity, nor did it raise in that case

the issues presented here.

atin ID Adee ey ns at's nt. Poca onde

denominational bodies. Leiffer declaration, Ex. H., Ex. AA

thereto, {| 13. Likewise, the general level boards are not sub-

ject to the control of any single person or council, but seek

to carry out the programs of the General Conference in

largely independent fashion. Jd., J 20.

This and other decentralized characteristics of the de-

nomination are noted by Bishop Tuell in his text. The

Organization of The United Methodist Church, (rev. ed.

1977) at 127-129:

“Tf someone had a complaint, and wanted to go to the

head of the United Methodist Church with it, that head

person would be hard to find. One might try the presi-

dent of the Council of Bishops, but would discover that

this person is primarily a presiding officer over the

semi-annual meetings of the Council of Bishops. The

president has no particular authority in the church at

large not possessed by all other bishops. . .

“One might try the general secretary of the General

Council on Ministries, but would discover that this

person, though head of an agency involved in co-

ordinating the total work of the program agencies of

the church, is by no means in charge of the total work

of The United Methodist Church. If our complainant

went to see the executive head of one of our boards or

agencies, he or she would be told that that person has

charge of only a certain portion of the work of the

church. One might approach the presiding bishop of

a session of the Generai Conference, but would be told

that anywhere from fifteen to twenty-five bishops may

share in the task of presiding at any quadrennial meet-

ing of the General Conference. If one were to go to

the president of the Judicial Council, he or she would

be told, ‘All we do is decide cases.’

“This is simply tv illustrate the fact that power and

authority are widely dispersed within The United

Methodist Church, undoubtedly deliberately so. We

have inherited from the founders of America a rather

keen distrust of too much power centralized in one

person. There is not only not a head person, there are

no headquarters of our church. This is not necessarily

bad, but we should recognize that this general lack of

central direction over the years has resulted in our

various boards and agencies pretty much going their

own independent ways, each developing its own pro-

grams which sometimes overlapped with programs of

our other agencies and sometimes actually conflicted. . .”

Except for the quadrennial General Conference, there is

no person or group who can speak for or commit the entire

denomination to action. The Book of Discipline, { 612. The

affidavit of Ewing Wayland (Ex. V, Ex. L thereto) demon-

strates, without contradiction by the plaintiffs below, that

the United Methodist Church, in its denominational entirety

and as distinguished from its affiliated organizations, has

never:

(1) Employed any person or held any employer identi-

fication number ;

(2) Held any bank account;

(3) Issued any check, note or draft;

(4) Held legal title to any property, real or personal ;

(5) Except for “covenants” of religious cooperation

and comity with other religious groups, entered

into any contract;

(6) Filed a tax return;

(7) Maintained a denominational headquarters; or

(8) Established any officers for the entire denomina-

tion, and specifically, has never had a chief execu-

tive or other head person.

Ex. V, Ex. L thereto, (2; Ex. H, Ex. G thereto at 17;

Wayland Dep. at 231.

The plaintiffs in Barr and the related cases have never

specifically stated who they believe controls or can speak

for the entire denomination. They have indicated that they

NettO ink wR dts th Toes oe 4 be

would seek to enforce any judgment they obtain against the

entire denomination by levying against all gifts of “general

funds” made by local church numbers for the specific sup-

port of national and global ministries of the Church, regard-

less of what denominational unit is in possession of such

funds at a particular time. Thus the possible targets for

levy would include United Methodist local churches, the

annual conferences, the General Council on Finance and

Administration acting as conduit, its twelve sister general

boards and any of the hundreds of denominational units for

whose religious and charitable ministries the funds are

given in the first instance. Plaintiff’s Answer to Petition for

Hearing below, 4th Civ. No. 18244 (Supreme Court of

California, 1979) at 43 n. 25.

D. Rulings Below.

On March 20, 1978, after considering the evidence of the

parties and the arguments of counsel, the trial court, Hon-

orable Ross G. Tharp, entered its Minute Order decision

(App. B). The court found:

“The ‘United Methodist Church’ is an international

religious denomination consisting of over 10,000,000

persons who worship in some 43,000 churches and mis-

sions throughout the world. The ‘United Methodist

Church’ is a connectional structure maintained through

a chain and series of periodic conferences. It has never

been incorporated.”

App. B at A-22.

The court held that the denomination was not sufficiently

centralized to be deemed an unincorporated association sub-

ject to suit, citing an article in the Encyclopedia Brittanica

which noted the diffuse organization of the denomination.

Id. Finally, the court warned that:

“A contrary ruling would effectively destroy Methodism

in this country, and would have a chilling effect on all

churches and religious movements by inhibiting the free

association of persons of similar religious beliefs.”

App. B at A-22, 23. Plaintiffs appealed. On March 8, 1979,

the California Court of Appeal reversed, holding that the

United Methodist Churel vas a legal person, subject to

suit.

The Court of Appeal recognized that the denomination

“may be unique in that it has no single chief operating

officer” (App. A at 11), but “the clearly defined operating

and conceptual levels of responsibility starting with the

General Conference ... cannot be ignored.” Id. The court

also stated, without reference to the contrary expert testi-

mony that “a persuasive argument can be made that the

Council of Bishops is equivalent to the [denomination]

board of directors.” Jd. The court similarly accepted other

factual arguments made by plaintiff’s counsel. It explicitly

rejected the contrary expert testimony. App. A at A-17, 18.

The court held, however, that the question of the denom-

ination’s status was not a question of fact but involved

only the application of law to uncontested facts. The court

stated the law bluntly:

“The criteria applied to determine whether an entity

is an unincorporated association are no more compli-

cated than (1) a group whose members share a common

purpose, and (2) who function under a common name

under circumstances where fairness requires the group

to be recognized as a legal entity. Fairness includes

those situations where persons dealing with the asso-

ciation contend their legal rights have been violated.”

App. A at A-8, 9.

The Court of Appeal saw no due process or First Amend-

ment problem in requiring the denomination to litigate as

if it were a cohesive entity. And, in any event, it declined

to apply First Amendment protections against judicial re-

vision of church doctrine and polity, taking the position

this would require a grant of religious immunity. App. A

Nn ee eee ee eee oe Deki ne! Bgsewbe reer SEP iewtek

at A-18, 19. Finally, the Court perceived no due process

problem in suing a denominational name without naming

as defendants the component religious units whose assets

might later be sought, in execution of a judgment against

such a commonly named group, as purported “associational”

assets. App. A at A-17.

Petitioners’ Petition For Rehearing, filed with the Court

of Appeal on March 23, 1979, was denied, without opinion,

by Order of said Court entered on March 29, 1979 (App. C).

After the California Supreme Court denied hearing, by

Order dated May 17, 1979 (App. D), petitioners sought this

Court’s review.

REASONS FOR GRANTING THE WRIT

For many years, both federal courts and the courts of

various states have permitted suits to be brought, as a

matter of convenience in pleading, against “unincorporated

associations.” However, no such action has ever before in-

volved a major international religious denomination. Rather,

these suits have generally involved labor unions or other

entities with a quasi-corporate structure. Nor has any court,

to petitioners’ knowledge, ever before defined the minimum

characteristics necessary for treatment as a suable “unin-

corporated association.” The Court of Appeal below devised

and applied just such a definition. It held that any aggre-

gation of persons or groups can be sued as an entity so

long as its members (1) share a “common purpose” and

(2) “function under a common name under circumstances

where fairness requires the group to be recognized as a

legal entity.” App. A at A-9. The court made clear that con-

siderations of “fairness” in this context could be limited

to the interests asserted by those who seek to bring the

action.

For the individuals and units who make up any aggre-

gation alleged to be an unincorporated association, the

consequences of such a lawsuit may be severe. Their individ-

ual property may be at stake, so long as it can be claimed

to be held for the benefit of the association, yet the suit

may be in a distant forum, and the “association” may have |

no ability to present a concerted defense. Indeed, the asso-

ciation may have the independence of its members as a

central tenet. Under the definition of the Court of Appeal,

precisely such “aggregation” may be fused into a single

legal person and deemed subject to suit. Surely every

religious denomination fits the common purpose/common

name rubric, even those whose members and units are most

independent of one another—Congregationalists, Baptists,

Unitarians. Any major religious denomination, regardless

of structure, can be forced to respond, in any court, to any

suit premised on the alleged acts or omissions of local

religious units bearing the common name. The rubric ap-

plies equally well to wholly secular “associations” like “the

Bell System” or “the Women’s Movement.” Individuals or

groups affiliated with any such associations, under the rule

of the Court of Appeals, can be subjected to lawsuits

brought against the common name, regardless of their con-

tacts with the forum state and regardless of the “associa-

tion’s” ability to defend.

In the present case, a loosely-structured, “connectional”

religious denomination consisting of over 45,000 largely

independent local churches, with no joint assets and no

central management, has been subjected to a lawsuit seek-

ing hundreds of millions of dollars in damages. To defend

the lawsuit would require a restructuring of the government

of the denomination to create a monolithic unit, able to

speak with one voice and act in a unified manner; to de-

fault would threaten each local church, conference and

board with a judgment against whatever is later deemed

“association” property in its control.

The rule of Court of the Appeal has created a manifest in-

justice in the present case and it has potential for enormous

ice tease tell

harm in other cases. It is an invitation for in terrorem

litigation against a new class of defendants. This Court

should grant certiorari to clarify the extent to which States

can, consistent with the United States Constitution, allow

aggregations of individuals and groups to be sued as en-

tities.

I. SECTION 388 OF THE CALIFORNIA CODE OF

CIVIL PROCEDURE CANNOT, CONSISTENT WITH

DUE PROCESS, BE INTERPRETED TO ALLOW

AN ACTION FOR DAMAGES TO BE BROUGHT

AGAINST AN AGGREGATION OF PERSONS AND

ENTITIES WHO HOLD NO COMMON ASSETS, AND

WHO HAVE NO CENTRALIZED MANAGEMENT.

The leading California case regarding suits against un-

incorporated associations is Jardine v. Superior Court, 213

Cal. 301, 2 P.2d 756 (1931). In that decision, the California

Supreme Court upheld the constitutionality of Section 388

of the California Code of Civil Procedure, which provided

for such suits. In so doing, the court noted the historical

treatment of unincorporated associations:

“For a long time the established rule was that in the

absence of statute, an unincorporated association could

not sue or be sued in its common name; all the mem-

bers thereof had to appear in their own names as par-

ties plaintiff or defendant. The basic reason was that

the association was not, in the eyes of the law, a legal

unit or entity, and had no legal capacity to become a

party to an action. The difficulty was only one of pro-

cedure, and the objection was purely technical. The

liabilities or rights of the members were in no way

involved, and were not, in theory, impaired by the

operation of the rule. They might have brought actions

if they all joined as plaintiffs, and they might have been

held to any liability imposed upon them by law, if sued

and served individually.” 2 P.2d at 759.

The Court then noted that various statutes, such as Sec-

tion 388, were enacted to change the rule regarding suits

against unincorporated associations, but only as to proce-

dure.

“These statutes dealt solely with the manner of bring-

ing actions, and were not intended to effect any change

in the substantive law. Members of associations had the

same rights and were subject to the same liabilities as

before, only now they could be sued by a less compli-

cated and cumbersome process.

Id.

No question was raised in Jardine as to whether the de-

fendant stock exchange was an unincorporated association.

Its sixty members paid dues and governed their affairs

through elected trustees. The only question as to applicabil-

ity of the statute was whether the exchange as whole “con- .

ducted business,” a requirement which has, by amendment,

been removed from Section 388.° Accordingly, the court in

Jardine was not called upon to determine the characteris-

tics of an unincorporated assogiation subject to suit.

In United Mine Workers v. Coronado Coal Co., 259 U.S.

44 (1922), this Court had earlier held, as a matter of federal

common law, that the United Mine Workers of America

could be sued as an unincorporated association. There, too,

the Court was not required to specify the pregise param-

eters of an unincorporated association. However; the Court

did specify those aspects of the-union’s organization which

made suit against it appropriate.

“The body governing the union in the interval between

conventions is the International Board consisting of

the principal officers, the president, vice-president and

secretary-treasurer, together with a member from each

district. The president has much power. He can remove

- or suspend International officers, appoints the national

6 The section now reads, in relevant part, “Any partnership or

other nnincorporated association, whether organized for profit or

not, may sue and be sued in the name which it has assumed or by

which ittis known.” .

Aa ate EN aT ti Bad oe a <u

Lee oe a ee ae a

22h STASI

teen ate Oa se

eat Saati BaD Sia nT NS OL WEN Ge

RE dR ene UES alte a OER

organizers and subordinates, and is to interpret au-

thoritatively the constitution, subject to reversal by

the International Board. When the Board is not in

session, the individual members are to do what he

directs them to do.” 259 U.S. at 383-384.

“The membership of the union has reached 450,000. The

dues received from them for the national and district

organizations make a very large annual total, and the

obligations assumed ... are so heavy that an extensive

financial business is carried on, money is borrowed,

notes are given to banks, and in every way the union

acts as a business entity, distinct from its members. No

organized corporation has greater unity of action, and

none is more power centered in the governing executive

bodies.” 259 U.S. at 385. (emphasis added)

“It would be unfortutiate if an organization with as

great power as this International Union has in the rais-

ing of large funds and in directing the conduct of four

hundred thousand members in carrying on, in a wide

territory, industrial controversies and strikes ... could

assemble its assets to be used therein free from lia-

bility for injuries by torts committed in the course of

such strikes. .To remand persons injured to a suit

against each of :the 400,000 members to recover dam-

ages ... would be to leave them remediless.” 259 U.S.

at 388-89. (emphasis added)

Thus, in both Jardine and Coronado, the unincorporated

association found subject to suit had both a central man-

agement, capable of speaking for the association, and de-

fined associational assets. Petitioners are aware of no

decision in which a large aggregation without these char-

acteristics has been held subject to a suit for damages.’

* Steuer v. Phelps, 41 Cal. App. 3d 468, 116 Cal. Rptr. 61 (1974)

involved an action for damages against a religious group with no

bylaws or directors of any kind, but the group had only nine

members, and se was obviously able to act in a cohesive fashion

without such formalities. In contrast one court looked to the

absence of bylaws, offices, a mailing address, bank accounts, assets

and obligations in determining that a committee of a sports asso-

In holding that the United Methodist Church was a suable

‘“gnincorporated association,” the California Court of Ap-

peal thus took an unprecedented action, for the denomina-

tion, as noted above, has no central executive whatever, and

holds no property of any kind.

A. The Rule of Law Applied by the Court of Appea’

The Court of Appeal found the denomination to be an

unincorporated association, subject to suit as an entity, by

applying a unique rule of law. The court, for the first time

in any reported decision, announced a sweeping definition

based on “common purposes,” “common name” and “fair-

ness”.

Under this novel definition, the United Methodist Church

undoubtedly would be an unincorporated association. Its

many constituent groups and individuals do share a com-

mon purpose, “the maintenance of worship, the edification

ciation could not be sued as an unincorporated association, Cali-

fornia Clippers, Inc. v. United States Soccer Football Assn., 314

F. Supp. 1057, 1068 (N.D. Cal. 1970) The Colorado Supreme

Court concluded that an unincorporated association should have

“responsible officers elected according to by-laws”. Hidden Lake

Development Co. v. District Court, 183 Colo. 168, 173, 515 p. 2d

632, 635 (1973). That court said: “The status of an unincorporated

association must be founded on more than a bald allegation. To sue

as an incorporated association in name only is insufficient. Such

legal entity must in fact exist . . .” Id. In Penrod Drilling Co. v.

Johnson, 414 F. 2d 1217, 1222 (5th Cir. 1969, the court defined

the term by reference to 7 C.J.S. Associations § 1, at p. 19 (1937) :

“An ‘association’ is a body of persons acting together without a

charter, but upon the methods and forms used by corporations, for

the prosecution of some common enterprise”. It has been suggested

that the “association” as used in Rule 17(b) Fed.R.Civ.P. “refers

to associations such as trade unions, fraternal organizations, busi-

ness organizations, and the like”. Yonce v. Miners Memorial Hos-

pital Assn., Inc., 161 F. Supp. 178 (W.D. Va. 1958) (welfare

fund of a union held not subject to suit as an unincorporated

association).

socio ian elas van aia lll

St teil Late APPR Nees AP adh Sts CLA LDP I GLO Slat BON

of believers, and the redemption of the world,” The Book

of Discipline, p. 19. Of course, the denomination has a name.

And the court’s requirement of “fairness” is satisfied by

the fact that plaintiffs have asserted a legal claim against

the denomination.

However, under the definition of the Court of Appeals,

every religious denomination, no matter how loosely or-

ganized, is an unincorporated association subject to suit,

since all have such common purposes as “salvation,” and

all have common names. So, too, any aggregation of persons

or corporations, commercial, social or political, cohesive

enough to be known by a common name, is covered by the

definition. The many companies known as “the Bell System”

or “the ITT group” share the common purpose of engaging

in profitable commercial enterprises. If a grouping can

reasonably be named, then, under the decision below, it is

suable.

This cannot be the law. In any suit against an association

it is ultimately the interests of individual members ie

component units which are at stake. As the California

Supreme Court noted in Jardine, suit against an association

is merely a procedural device for bringing the many indi-

vidual interests involved in the association before the court.

If there is a genuine, centrally directed associational entity

capable of defending a lawsuit and answering in duanees,

as in Jardine or Coronado, these individual interests will

be protected. However, if there is not such an entity, then

the individual interests will not be protected. Persons or

local groups may find their assets threatened in a distant

forum by lawsuits brought against any “association” to

which they belong, regardless of how loosely formed that

organization may be.

The present case presents these due process questions

starkly. First, the property rights of absent parties are

being adjudicated. Plaintiffs are seeking several hundred

million dollars for wrongs they allege were committed by

specific corporate bodies, such as GCFA and PSWAC, re-

lated to United Methodism. Their right to sue these entities

directly is not disputed. Yet they also sue the name of the

entire denomination, without pointing to any entity sep-

arate from the collection of religious units described in

paragraph 2 of the complaint. Unlike the United Mine-

workers in Coronado, there is no central management or

central funds separate from the component parts of the

“association.” Indeed, apart from its constituent local

churches, conferences, and boards, there is no United

Methodist Church. Thus, the only purpose for suing the

denominational name can be to obtain a judgment enforce-

able against assets other than those held by the four entities

specifically named as defendants.

Indeed, plaintiffs have asserted a broad agency theory,

and have never specifically defined the assets they believe

to be those of “the United Methodist Church.” The most

recent statement by plaintiffs’ counsel on this matter 1s In

their brief opposing the grant of certiorari in Trigg. There

it is asserted that the “funds” of the denomination “include

at least $60 million per year collected at the local church

level and funneled through Annual Conference treasurers

to... GCFA.” (Br. at 25 n. 13; emphasis added.) Yet these

funds do not stop at GCFA. Rather, they are funneled to

the general level agencies which perform the work of the

denomination on the national and international level. GCFA

is in no way a storehouse of unrestricted funds available

for judgment, but is merely a conduit for specifically desig-

nated funds to support “general” level ministries. (See

pp. 11-12, supra.) Thus, plaintiffs appear to seek all funds

held by any entity within the denomination which are in-

tended for national or worldwide religious or charitable

ministries, and will not even limit themselves to this. Be-

cause no assets are actually held by “The United Methodist

<b ns Ree Vat! tated Salts tS tele

FOMBRIR LE Sd WRAL NC RN AL Ct ae GRAS LE a SGD ILE peas ODA Ihe BIA ee ADD Dia ORS Ds thoes pain Stabe Ni Nae ad BRED ae 3A

ais eee ee Bhi doe, jetta ES ha TE RS ate Tee AO Bobs

Church,” plaintiffs are conveniently able to claim the assets

of any group affiliated with the denomination.

Plaintiffs have suggested, throughout this litigation, that

the unnamed units of United Methodism need fear no judg-

ment against the denomination because such a judgment

would only threaten assets of the denomination as a whole.

The Court of Appeal apparently accepted this argument,

citing (App. A at A-17) California Corporations Code sec-

tion 24002: “Only the property of an unincorporated asso-

ciation may be levied upon under a writ of execution issued

to enforce a judgment against the association.” This is cold

comfort, however, when “unincorporated association” is

defined so broadly as to include an aggregation which,

viewed as an entity, owns no property, and when plaintiffs

will not limit their claims to assets held in the name of the

association. The court’s unprecedented definition, together

with “agency” and “alter ego” allegations, makes the prop-

erty of every constituent member potential “property of an

unincorporated association.” This result cannot comport

with the basic tenet of due process that parties not have

their interests adjudicated without notice. Mullane v. Cen-

tral Hanover Trust Co., 339 U.S. 306 (1950).

Secondly, and apart from the question of whose property

is at stake, the United Methodist Church, not being an

entity, cannot conduct the defense of a lawsuit. As a matter

of church law, no person or group of persons, other than the

General Conference (whose delegates from around the

world meet every four years for ten days and then adjourn

sine die), has the authority to act as spokesman for the

denomination as a whole.

“No person, no paper, no organization has the authority

to speak officially for The United Methodist Church,

this right having been reserved exclusively to the Gen-

eral Conference under the Constitution.”

The Book of Discipline, | 612(1). Thus, no one within the

denomination has authority to answer the complaint or

assert the position of the denomination in consultation with

counsel.®

The difficulty, moreover, is not simply a product of one

paragraph of the denomination’s rules of government. As

a matter of practical fact, there is no single person or body

which controls the United Methodist denomination. No one

within the denomination, then, can instruct counsel or as-

semble the information necessary to compose intelligent

pleadings and build a coherent case. Similarly, no one can

answer discovery requests served upon “The United Metho-

8 The Court of Appeal apparently believed that Paragraph 612(1)

of the Book of Discipline was overridden by Paragraph 907 (4)

which empowers GCFA “[t]o take all necessary legal steps to safe-

guard and protect the interests and rights of The United Methodist

Church.” App. A at A-12, 13. Yet paragraph 907(4) provides that

GCFA may make provision for legal counsel only “at the request

of a general agency or bishop,” presumably in connection with

litigation involving a constituent body of the Church. The practical

interpretation of Paragraph 907(4) has invariably been that GCFA

will discharge its “legal” function by (1) maintaining a collection

of legal briefs in cases of interest to religion, and (2) reimbursing

Annual Conferences for up to 50% of their expenses of engaging

their own counsel to deal with local problems. (Wayland affidavit,

Appendix D to Petition for Rehearing, below).

The Court of Appeal’s March 8, 1979 Opinion constituted the

first time that any court had interpreted Paragraph 907(4) as

rendering GCFA, in effect, house counsel for all of United Method-

ism. Accordingly GCF A, through its separate counsel not of record

in the present litigation, applied on April 6, 1979 to the Judicial

Council of the United Methodist Church for an interpretation of its

proper functions under that provision, viewed in light of Paragraph

612, forbidding “speaking for the Church”. On May 25, 1979, upon

consideration of this issue, in compliance with the Church-wide

notice, publication and other procedural requirements for such

hearings set forth in The Book of Discipline, the Judicial Council

ruled that GCFA has no authority to become a litigation repre-

sentative for the entire denomination. A published syllabus of the

Judicial Council’s ruling No. 458 is included in the accompanying

Appendix (App. E).

bat Air wicca

ig aN a As te oh A Min SIGS Ba AB

e eam tah

dist Church.” Plaintiffs have never claimed, and the Court

of Appeal did not find, that there is any “headquarters”

within the denomination. In fact, there is no central record

keeping facility and no means for directing the assembly of

records in a central location. Nevertheless, plaintiffs have

served an exhaustive document request on the “Custodian(s)

of records of the United Methodist Church,” demanding,

inter alia, any and all documents of the denomination or its

predecessors (thus dating back over 200 years) which “per-

tain to [its] ... organization, structure, duties, function,

purpose or work.” Deposition Notice filed August 3, 1979, at

10. Plaintiffs have left it to the persons served to determine

who this “custodian” is and how he should exert control

over 45,000 units, internationally, in screening and gather-

ing documents. This is simply one illustration of how litiga-

tion against a large diffuse aggregation without a central

executive is, as a matter of fact, wholly unworkable.

The lack of capacity to conduct litigation again ultimately

harms the separate groups and entities which compose the

United Methodist denomination. Even if there were assets

held in the name of the denomination, the members of the

association would have a strong interest in preserving those

assets, much as the beneficiaries of a common fund. Yet by

sanctioning the present action, the Court Appeal made no

provision for adequate representation of these interests.

This, again, is a manifest denial of due process. Hansberry

v. Lee, 311 U.S. 32 (1940).

Finally, the decision of the Court of Appeal has the

potential effect of improperly foreclosing issues which ought

to be decided at trial. One of the crucial allegations of the

complaint is that the defendants are enmeshed in a web

of mutual “alter ego” and “agency” relationships. They

deny it. Yet the Court of Appeal, by finding all of United

Methodism to be a single entity, and allowing the litigation

to proceed on that basis, forces defendants into the appear-

ance of joint agency. And this is despite the fact that the

court’s test of common purpose/common name, requires no

showing of unified action whatever. The result is a blurring

of normally recognized distinctions between separate legal

entities.

The present case, then, provides the prospect for litigation

conducted against an effectively absent party—the denom-

ination—and a judgment enforced against actually absent

parties—the thousands of church units which make up the

denomination, with critical issues prejudged. All of this is

of no concern under the definition of “unincorporated asso-

ciation” devised and applied by the Court of Appeal, be-

eause this is all consistent with the “common purpose/

common name” rationale.

B. Fact Finding by the Court of Appeal

The Court of Appeal reached its conclusion that the

United Methodist Church was an “unincorporated associa-

tion” based, it said, on the application of law (the common

purpose/common name definition) to uncontested facts.

“The facts contained in the affidavits and declarations

submitted, including the information in the Book of

Discipline of the United Methodist Church (1976), are

not in dispute.” App. A at A-5.

This was a necessary pre-requisite to the court’s decision,

since the trial court had found that the denomination was

not a jural entity, and since California, like most jurisdic-

tions, requires that deference be given by appellate tribu-

nals to the factual conclusions of a trial court.®

® It is a settled rule in California that courts of review will not

reweigh evidence if substantial evidence of record supports the

judgment below, Bancroft-Whitney Co. v. McHugh, 166 Cal. 140,

142 (1913). Also, the reviewing court must imply the necessary

factual findings to support the judgment if there is any sub-

stantial evidence before it. Hall v. Bureau of Employment Agencies,

64 Cal. App. 3d 482, 496 (1976), cert. denied, 97 S. Ct. 2187 (1977).

tid thateds tim gos

For the reasons noted above, the rule of law fashioned by

the Court of Appeal cannot be reconciled with the require-

ments of due process. Perhaps in response to this problem,

the Court of Appeal made numerous statements to the

effect that the United Methodist Church has acted as a

cohesive unity under executive direction, largely incorpo-

rating arguments by plaintiffs. See App. A. at A-9 through

A-14.° In so doing, the court simply engaged in its own

interpretation of internal church documents, and ignored

inconsistent facts and opinion. The Court of Appeal spe-

cifically noted that it was “rejecting the ecclesiastical ex-

pertise furnished by persons knowledgeable in the history

development and faith of United Methodism.” App. at A-17,

18. The court did in fact resolve factual disputes in the

course of its opinion. So that the constitutional issues

raised by the “common name/common purpose” are not

obscured, several of the Court of Appeal’s findings of fact

are here noted’and placed in the context of the evidence

presented to the trial court.

1. The Court of Appeal found that since The Book of

Discipline gives the bishops of the denomination the duty

of “overseeing” or “superintending” its affairs, the Council

of Bishops is akin to a Board of Directors of United

Methodism. App. A. at A-11. As noted above, (page 10),

the expert evidence is clear that the Council of Bishops is

not the managing board of all United Methodism; in fact

the Council has no authority to direct any action by any

individual or unit in the denomination. Leiffer Dep. at 142;

Milhouse affidavit (App. Ex. B to Petition for Rehearing

Below) at 4; Ex. H, Ex. C thereto, Milhouse affidavit

herein, at Par. 7.

10 Plaintiffs’ persistent practice in this litigation has been to refer

to action taken by any unit within United Methodism as that of

“UMC,” thus assuming the issue which is to be resolved. The Court

of Appeal adopted this practice.

In 1974, long before this litigation began, Bishop Roy

Short made precisely the same statements in his text United

Methodism in Theory and Practice (at 74-75):

“According to United Methodist law, the Council of

Bishops is given no authority to act for the Church

between sessions of the General Conference. Neither

is it given any power of control over the Annual Con-

ferences or over the various agencies of the Church.

... The Council is not a control body im United Meth-

odism. It should be understood that back of this lim-

tation lies almost 200 years of history.” (Emphasis

added)

2. The court found that the denomination has been in-

volved as a “principal” in other litigation, and has been

held by the courts to be a “hierarchical” church. App. A. at

A-13. This represents an erroneous understanding of how

the denominational name came to be used in certain litigated

eases erroneously cited by plaintiffs. These cases involved

local units and their properties, not the whole denomination.

In the trial court, petitioners showed that all such cases

were strictly internal within annual conferences involving

local church disputes, and that they were the result of liti-

gation decisions by local church personnel who acted with-

out any external denomination direction or control. Way-

land affidavit, App. Ex. A to Petition for Rehearing below;

Frank Jones affidavit, Ex. V, Ex. M thereto."

11In the entire history of the United Methodist Church and

its predecessors, there is only one reported case in which the name

of the entire denomination appeared in the caption. The United

Methodist Church v. St. Louis Crossing Independent Church, 150

Ind. App. 574, 276 N.E. 2d 916 (1972). This suit was brought by

schismatic members of a local church, seeking an injunction en-

forcing their claim to the property of that local church. It was

they who named the denomination as a defendant, but the action

was defended by a district superintendent of a district within an

annual conference and by other local interests, 276 N.E.2d at

917. The capacity of the denomination was not relevant or at issue.

There are three similar trial court actions in Georgia which are

unreported. In each case, a dissident group had attempted to take

a oe ee

MORE rb RA.

Nor is the finding that the denomination is hierarchical

of significance here. The term “hierarchical”, as developed

by courts in determining church property disputes, is used

in opposition to the “congregational” form of church gov-

ernment, “in which the autonomy of the local congregation

is the central principle.” Note, Judicial Intervention in

Disputes over the Use of Church Property, 75 Harv. L.

Rev. 1142, 1143-44. The “connectionalism” of the United

Methodist Church is simply one form of church government

within the broad hierarchical category. Id., at 1144 n. 14;

Brady v. Reiner, 198 S.E.2d 812, 827 (W. Va. 1973). The

designation “hierarchical” in local property cases simply

has no relevance to the issues involved here.

3. The Court of Appeal observes (App. A. at A-16,

17) that, according to a 1967 publication, the Methodist

Health & Welfare Certification Council of the Board of

Hospitals & Homes of The United Methodist Church

granted Pacific Homes “affiliate status.” The opinion omits

the crucial language of that report, which had been placed

before the trial court, defining affiliated status as follows:

“An affiliated . . . agency will be one which has applied

for certification and has reached the level of affiliate.

An agency’s church ‘relationship’ will be to the Annual

Conference.” (Emphasis added, Ex. V, Ex. N-6 thereto

at 2.)

over the property of a local church, and the name “The United

Methodist Church” was used by the annual conference and local

authorities which actually brought suit against the dissidents, in

order to indicate that the interests of all United Methodists were

involved. See Jones affidavit, Ex. V, Ex. M thereto. The Court of

Appeal refers to this affidavit as containing the belief’s of “UMC’s

own lawyer” when the point at issue was the question of whether

Frank C. Jones had acted as “UMC’s own lawyer.” The affidavit

filed with the trial court showed he was acting solely on behalf of

local officials in the affected Annual Conference without any ex-

ternal direction.

This clearly indicates that the homes and hospitals were

not instrumentalities of any central denominational execu-

tive, but rather operated as ministries in relationship to

separate annual conferences.

4. Apparently focusing upon a sentence contained in a

letter from a former General Secretary of GCFA to the

IRS to the effect that GCFA is the “central treasury and

fiscal agent” of Methodism, and noting that. five and one-

half percent of total member contributions “are given an-

nually to GCFA” (App. A. at 12), the Court suggests that

GCFA is the end-recipient and keeper of denominational

funds. The evidence was uncontradicted below that GCFA

is not a banker or repository of The United Methodist

Church. Rather, it is a conduit to pass monies, ealled “gen-

eral” funds because of their specific allocation to general

level agencies, on to its twelve sister Boards enya

various worldwide ministries at the “general level” of the

denomination. GCFA is also a provider of fiscal support

services, such as auditing and check-writing, sometimes

referred to as “central treasury” services, to certain of

these twelve boards. GCFA interacts with only a small

fraction of the units composing United Methodism. Way-

land Dep. at 150-152; 245-248. As stated earlier, there are

no funds of the United Methodist Church, per se, since all

assets are those of the separate constituent bodies. Esple

Affidavit, Ex. V, Ex. K thereto at 14; Wayland Affidavit,

Ex. V, Ex. L thereto, at { 2.

5. Finally, in seeking to depict the entire denomination as

a single legal entity, the Court of Appeal refers to a high-

limit insurance contract covering “UMC” (App. A. at A-13),

thus adopting contentions made by plaintiffs to the trial

court which were contradicted by affidavit testimony. (Ex. V,

Ex. K thereto). This testimony showed that the policy in

question was one of thousands of separate insurance con-

tracts taken out by the various units across the United

Methodist Church, and that it applied to only a handful

of specific church units and named property locations out

of tens of thousands making up the denomination. As the

affidavit testimony showed, the person arranging coverage

added the term “The United Methodist Church” as an

“overlay” to the relatively short list of specifically named

insureds in Policy Endorsement No. 1 simply as a matter of

prudence, but:

“The United Methodist Church . . . is not incorporated,

holds no title to any property, real or personal, or other

asset of any kind either at the scheduled locations or

elsewhere. It has no employees, it has no office location

or headquarters. No portion of the [annual] premium

of $19,991 for this insurance policy was calculated with

respect to any identifiable insurance coverage for ‘The

United Methodist Church’ as a totality and religious

connection.” (Jd., at 5)

This policy then, was hardly a “high-limit contract of in-

surance on the United Methodist Church.” The Court of

Appeal was further mistaken in stating that the cover sheet

on the policy referred to the United Methodist Church as

a corporation. The “corporation” box was checked on the

form, not to identify the denomination as such (which it is

not), but to reflect the fact that the applicant, GCFA, was

a corporation.

These factual disputes, again, were not relevant to the

holding of the Court of Appeal. Even properly viewed, the

United Methodist Church would be an “unincorporated asso-

ciation” under the common purpose/common name test

which that court devised. Had the court applied a legal

standard which cons ‘dered the actual operations of the “as-

sociation” named as defendant, it might have reviewed the

facts more carefully. As the trial court rightly concluded,

there is no basis for determination that the denomination

operates with any centralized authoritarian polity.

C. The Finality of the Decision

Although the decision of the Court of Appeal provides

that there be further proceedings against the United

Methodist Church in this matter, the decision is effectively

a final one against the denomination, satisfying the pre-

requisite for this Court’s jurisdiction under 28 U.S.C. § 1297.

In Cox Broadcasting Corp. v. Cohn, 420 U.S. 469, 476-87,

(1974) this Court outlined four categories of cases which

have been treated as final decisions for the purposes of Sec-

tion 1257, even though only the federal issue presented by

the cases had been finally decided by the state courts, and

further proceedings remained for lower state court action.

The present case fits two of the Cox Broadcasting categories.

First, this case appears to present a situation “where the

federal claim has been finally decided, with further proceed-

ings on the merits in the state courts to come, but in which

later review of the federal issue cannot be had, whatever

the ultimate outcome of the case.” 420 U.S. at 481. After

the decision of the Court of Appeal, the petitioners, in

order to avoid default and potential judgment of over 100

million dollars, were required to file an answer on the

behalf of the United Methodist Church. This answer is

included as App. F in the appendix bound herewith. If

plaintiffs ultimately do not prevail against the denomina-

tion, the issue of its amenability to suit will be moot. How-

ever, should the plaintiffs prevail, the petitioners’ answer—

even though it attempts to preserve the federal question—

may be deemed a waiver.

Section 418.10 of the California Code of Civil Procedure

sets forth rules of pleading which do not provide a named

defendant the opportunity to answer or defend on the

merits while saving jurisdictional defenses for post-

judgment review. These provisions have been interpreted

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as requiring that any answer be deemed an irrevocable

submission to jurisdiction. McCorkle v. City of Los Anaeles,

70 Cal. 2d 252, 257058, 449 P.2d 453, 74 Cal. Rptr. 389

(1969); 5 Cal. Jur. 2d § 45, 3 Cal. Jur. 3d § 20, et seq.

Thus, unless this Court now reviews the issues raised by

this petition, they may prove unreviewable. Under these

circumstances, the issue is ripe for review. Cf. North Dakota

State Board of Pharmacy v. Snyder’s Drug Stores, Inc.,

414 U.S. 156 (1973).

Second, this case is one in which “reversal of the state

court on the federal issue would be preclusive of any further

litigation on the relevant cause of action,” and “a refusal

to immediately review the state-court decision might seri-

ously erode federal policy.” Cox Broadcasting, 420 U.S. at

482-83. This case presents the first of what could be a new

style of im terrorem actions against major religious denom-

inations, contrary to the due process guaranteed by the Con-

stitution.

If this litigation is allowed to proceed, there is no one

who can, as a matter both of church law and of fact, con-

duct this litigation on behalf of the entire United Methodist

Church. Necessarily, the litigation would result in ineffec-

tive representation of whatever interests are found to be

encompassed under the denominational name. The present

petitioners have filed an answer denying the jural status

of the United Methodist Church and their own authority to

speak on its behalf. However, these petitioners cannot

conduct a lawsuit. The members of the denomination face a

potential judgment of millions of dollars with no means of

defense. These constituent units of United Methodism will,

as things now stand, have foregone their defenses on the

merits. The question is too important and too pressing to

postpone.

Il. SECTION 388 OF THE CALIFORNIA CODE OF

CIVIL PROCEDURE CANNOT, CONSISTENT WITH

THE CONSTITUTIONAL GUARANTY OF FREE

EXERCISE OF RELIGION, BE INTERPRETED TO

RENDER LIABLE TO A SUIT FOR DAMAGES

A RELIGIOUS DENCMINATION COMPOSED OF

MANY SEPARATE ENTITIES WITH NO UNIFIED

AUTHORITARIAN STRUCTURE, MANAGING

BOARD OR EXECUTIVE OFFICERS AND NO

JOINT DENOMINATIONAL ASSETS.

The denials of due process engendered by the decision

of the Court of Appeal, outlined above, are exacerbated in

this case because the free exercise of religion is involved.

This Court has made it plain, in repeated decisions, that

the First Amendment, made applicable to the states through

the Fourteenth, protects not only the systems of religious

beliefs, but also systems of religious organization. Serbian

Eastern Orthodox Diocese v. Milivojevich, 426 U.S. 696,

721-22 (1976) ; Kedroff v. St. Nicholas Cathedral, 344 US.

94, 116 (1952) (“religious freedom encompasses the power

fof religious bodies] to decide for themselves, free from

state interference, matters of church government as well

as those of faith and doctrine.” See NURB v. Catholic

Bishop, US. : S. Ct. (1979) (interpretation

of the National Labor Relations Act to require collective

bargaining for teachers in church schools would imper-

missibly intrude on religion) ; McClure v. Salvation Army,

460 F.2d 553, 560 (5th Cir. 1972) (interpreting Title VII

of the Civil Rights Act of 1964 not to apply to the employ-

ment of ministers by a church).

The decision of the Court of Appeal affronts the right to

free choice of religious polity in two ways. First, the court

improperly determined the polity of United Methodism by

explicitly rejecting all expert testimony on the subject, and

substituting its own reading of church law and documents,

wholly unsupported by any expert evidence. No expert wit-

ness was produced by plaintiffs at any stage of the proceed-

ing. It is manifest that the language and usages of church-

men may be quite different from the language of courts. In

the Serbian Church case, 426 U.S. at 714-15 n. 8, this Court

quoted the following observation from Watson v. Jones, 13

Wall 679, 723 (1872): “It is not to be supposed that the

judges of the civil courts can be as competent in the ecclesi-

astical law and religious faith [of large denominations] as

the ablest men in each are in reference to their own.” In

its most recent religious decision, Jones v. Wolf, US.

, 47 U.S.L.W. 4962 (July 2, 1979), this Court Jivided

on the proper method for determining right to ownership

of local church property between two schismatic groups.

Both majority and minority recognized, however, that in-

terpretation of church law and polity was a difficult task

for civil courts. Eg., 47 U.S.L.W. at 4964 (“neutral prin-

ciples” approach desirable because it avoids “entanglement

in questions of religious doctrine, polity, and practice’’).

By relying on its own reading of the ecclesiastical law of

United Methodism, the Court of Appeal gave the denom-

ination a form of government, centralized and authoritarian,

much different from the “connectionalism” which United

Methodists actually chose during a process of development

over two centuries.

More critically, however, the impact of the court’s deci-

sion is to force the denomination to act as though it were

centralized and authoritarian. For, barring reversal by

this Court, the members of the denomination can only de-

fend their rights in this lawsuit by creating a central au-

thority capable of speaking for United Methodism as an

entity, binding its many independent units by the filing of

legal documents, and directing its components in matters

such as compliance with discovery and satisfaction of judg-

ment. The alternative is total dissolution of the denomina-

tion-—cessation of all common effort of any kind.

If the standard of jurisdiction devised in the instant case

prevails, then it would follow that any class suit plaintiff

in quest of a “deep pocket” can now parlay money claims

asserted against any local community church, parish, or

religiously related hospital, college or orphanage into op-

pressive legal assaults upon whole religious systems. Only

formula pleading of “alter ego” and “agency” will be nec-

essary to achieve this unprecedented result and force any

major religious denomination in the spectrum of polities,

from Roman Catholic! to Baptist, to defend damage actions

in any courthouse as an asserted “unincorporated associa-

tion” irrespective of whether it is inherently capable of the

task.

There is no doubt that society can and must limit the

freedom of religious organizations to act, but only on be-

half of “those interests of the highest order and those not

otherwise served.” Wisconsin v. Yoder, 406 U.S. 205, 215

(1972). The interest asserted by plaintiffs in this case is a

right to recovery for alleged wrongs. There is no need to

require reorganization of the polity of the United Methodist

Church to serve that interest. Any unit of the denomination

is subject to suit if it has acted wrongly; there is no claim

here of religious immunity, despite plaintiffs’ repeated

statements to the contrary. There is no need to create an

overarching central management which worshippers within

the denomination have shunned since the days of John

Wesley. The decision of the Court of Appeal failed to ade-

quately consider either the impact on the exercise of re-

ligion of its application of Sec. 388 of the California Code

of Civil Procedure or the alternatives to that application.

In order to protect the chosen government of The United

Methodist Church, this Court’s review is needed.

12 A much sounder perception of the dangers inherent in broadside

actions against whole denominations is evident in Roman Catholic

Archbishop of San Francisco v. Superior Court, 15 Cal. App. 3d

405 (1971). There, the California Court of Appeal, in a suit based

on an alleged contract by a denominational unit in Switzerland, was

unwilling to view the Roman Catholic Church as a single, indivisible

entity.

CONCLUSION

For the reasons stated above, petitioners respectfully

pray that their Petition for a Writ of Certiorari be granted.

Respectfully submitted,

ALBERT EK. Jenner, Jr.

Keira F. Bove

Eucene R. Weporr

SaMvuEL W. Wirwer, Sr.

SaMuEL W. Witwer, JR.

Witwer, Moran, Buruace &

gerne & Biock ATKINSON

ne IBM Plaza 125 S. Wacker Drive

Chicago, IL 60611 Chicago, IL 60606

(312) 222-9350 (312) 332-6000

Auuan J. Renicue

Daniet R. Saas

WitutuM F. Faury

Suuuivan, Jones & ARCHER

1400 Financial Square

600 “B” Street

San Diego, CA 92101

(714) 236-1611

Attorneys for those persons upon whom service of

process was attempted on behalf of The United

Methodist Church.

APPENDIX

A-1

APPENDIX A

CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL,

FOURTH APPELLATE DISTRICT

DIVISION ONE

STATE OF CALIFORNIA

FRANK T. BARR, et al., i

Plaintiffs and Appellants, | . 4 x0 ig044

(Superior Court

THE UNITED METHODIST CHURCH, ron Sooner

Defendant and Respondent. }

APPEAL from an order of the Superior Court of San

Diego County. Ross G. Tharp, Judge. Reversed.

Milberg, Weiss, Bershad & Specthrie, William 8. Lerach,

Gregg A. Johnson, Frederick J. Milberg; Wied, Granby &

Alford, Colin W. Wied and David J. Yardley, attorneys for

Plaintiffs and Appellants. |

Sullivan, Jones & Archer, John H. Le’Estrange, Jr.,

Daniel R. Salas, Robert V. Vallandigham, Jr. and William

F. Fahey; Witwer, Moran, Burlage & Atkinson, Samuel W.

Witwer, Sr. and Samuel W. Witwer, Jr.; Musick, Peeler

& Garrett, William McD. Miller III and Wayne B. Little-

field; Hughes, Hubbard & Reed, William H. Levit, Jr. and

John H. Blue, attorneys for Defendant and Respondent.

Breed, Abbott & Morgan and Thomas A. Shaw, Jr., as

Amici Curiae on behalf of Defendant and Respondent.

O’Melveny & Myers, Bennett W. Priest and Robert J.

White; Kadison, Pfaelzer, Woodard, Quinn & Rossi and

Allen Woodard, attorneys for Intervenors.

The guarantees of due process of law and religious free-

dom under the State and Federal Constitutions do not pro-

A-2

hibit the United Methodist Church, a legal entity under

Code of Civil Procedure section 388, subdivision (a), from

being sued.! We reverse the order of the trial court quash-

ing service of summons on the United Methodist Church.’

1 Code of Civil Procedure section 388, subdivisions (a) and (b),

provides as follows:

“(a) Any partnership or other unincorporated association,

whether organized for profit or not, may sue and be sued in

the name which it has assumed or by which it is known.

“(b) Any member of the partnership or other unincorporated

association may be joined as a party in an action against the un-

incorporated association. If service of process is made on such

member as an individual, whether or not he is also served as a

person upon whom service is made on behalf of the unincorpo-

rated association, a judgment against him based on his personal

liability may be obtained in the action, whether such liability be

joint, joint and several, or several.”

2 The entire text of the minute order is as follows:

“The ‘United Methodist Church’ is an international religious

denomination consisting of over 10,000,000 persons who worship

in some 43,000 churches and missions throughout the world.

The ‘United Methodist Church’ is a ‘connectional’ structure

maintained through a chain and series of periodic conferences.

It has never been incorporated.

“A respected unbiased source, ‘The Encyclopedia Britannica,’

1959 Ed., Vol. 15, p. 358, states: ‘Methodism has continued for

more than two centuries to proclaim a freedom of spirit as op-

posed to the bondage of an organization, and its appeal has been

based on the reality of a personal experience of spiritual emanci-

pation through faith in Christ.’

“The Court rules that: ‘The United Methodist Church’ is no

more than a ‘spiritual confederation’ and is not a jural entity

or unincorporated association subject to suit under Code of

Civil Procedure 388. A contrary ruling would effectively de-

stroy Methodism in this country, and would have a chilling

effect on all churches and religious movements by inhibiting the

free association of persons of similar religious beliefs. If all

members of a particular faith were to be held personally liable

for the transgressions of their fellow churchmen, church pews

would soon be empty and the pulpits of America silent.

“Accordingly, the motion to quash service of process on ‘The

United Methodist Church’ is granted.”

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on ei sascha

Wa iedlet LN ALi ek.

A-3

The Procedural Background

Plaintiffs commenced their class a¢tion on behalf of

approximately 1,950 present and former residents of the

14 retirement homes operated in California, Hawaii and

Arizona by Pacific Homes Corporation (Pacific Homes) for

equitable relief or damages.* The complaint alleged each

member of the class had entered into a “continuing care

agreement” with Pacific Homes ;* that on or about February

18, 1977 Pacific Homes petitioned for relief under Chaspter

11 of the Bankruptcy Act in the United States District

Court for the Central District of California, and that the

defendants Pacific and Southwest Annual Conference of

the United Methodist Church (PSWAC), a California cor-

poration, the General Council on Finance and Administra-

tion of the United Methodist Church (GCFA), and the

United Methodist Church (UMC), were each financially

responsible for the operations of Pacific Homes. Plaintiffs

sought a declaration requiring each of the defendants to

specifically perform the continuing care agreements be-

tween each plaintiff and Pacific Homes or for damages.

3 The original complaint, filed September 21, 1977, contained six

causes of action. The first amended complaint, filed December 2, 1977,

with seven causes of action, sought the same relief as the original

complaint, but added as defendants the accounting firm of Coopers

and Lybrand, and the General Council on Finance and Administra-

tion of the United Methodist Church (GCFA), a corporation. Refer-

ence to the complaint includes reference to the first amended

complaint.

*The continuing care agreement provided that Pacific Homes

would furnish lifetime care, including medical, nursing and conva-

lescent care, accommodations and in most instances, food service.

Many of the plaintiffs had pre-paid their contracts and were entitled

to lifetime care at no additional cost; agreements involving the

remaining plaintiffs required fixed monthly payments for life, guar-

anteed never to increase or limited to deferred increases based upon

inflation.

A-4

Plaintiffs’ bases for jurisdiction over UMC in each cause

of action are the allegations which state UMC was an un-

incorporated association, Pacific Homes was the agent of

the defendants PSWAC, GCFA and UMC and in doing the

acts alleged was acting within the scope of its authority as

agent and with the permission, knowledge and consent of

PSWAC, UMC and GCFA; each defendant or predecessor

in interest was the agent of each other defendant and in

doing the acts alleged, each was acting within the scope of

his authority with the permission, knowledge and consent

of each other defendant; and Pacific Homes was the alter

ego of each defendant.

Persons upon whom service of process was attempted

on behalf of UMC moved to quash the service under Code

of Civil Procedure section 418.10 on the grounds that (1)

UMC was merely a loose connectional system and not a

jural entity capable of being sued under Code of Civil

Procedure section 388, subdivision (a); and (2) to permit

suit against UMC was unconstitutional as a violation of the

due process, free exercise and establishment of religion

provisions of the United States and California Constitu-

tions. Plaintiffs appeal from the order granting the motion

to quash service of summons (Code Civ. Proc., § 904.1, subd.

(c)).

The United Methodist Church is a Jural Entity under Code

of Civil Procedure Section 388, Subdivision (a)

The Status of UMC in the Litigation is a Question of

Law and Not of Fact

The initial argument made by UMC is that as an ele-

mentary principle of appellate procedure, we must uphold

the trial court order if it is supported by any substantial

evidence. (See gen. Bancroft-Whitney Co. v. McHugh (1913)

166 Cal. 140, 142; 6 Witkin, Cal. Procedure (2d ed. 1971)

Appeal, § 245, p. 4237.) The first difficulty we encounter

— , , .

iste scesinsn es SAARLAND AT BIS 1G BP nk

A-5

with this proposition is it assumes the trial judge made a

factual determination. Although there was a plethora of

evidence on the issue of whether UMC was an unincorpo-

rated association, the trial court explained its holding by

reference to two sets of considerations. One was peculiar

to Methodism with apparent reliance on the Encyclopedia

Britannica as an unbiased source; the other was of general

applicability to ‘all churches and religious movements”

with the apparent assumption that the suit against UMC

involved the unconstitutional interference with the free

exercise of religion. Nothing is contained in the trial court

order which suggests a factual determination was made

which involved the process of weighing the evidence which

was presented. Secondly, the analysis of whether UMC is a

jural entity involves a review of data relating to the crea-

tion, existence and operation of UMC. The facts contained

in the affidavits and declarations submitted, including the

information in the Book of Discipline of the United Meth-

odist Church (1976), are not in dispute. The only ostensible

factual conflict which arises is related to the ultimate issue

expressed in opinions of witnesses on behalf of UMC to the

effect that UMC cannot be sued. “In short, this is not a true

case of conflicting evidence in which a reviewing court will

refuse to disturb findings based thereon.” (Cosper v. Smith

& Wesson Arms Co. (1959) 53 Cal. 2d 77, 81; see also

Parsons v. Bristol Development Co. (1965) 62 Cal. 2d 861,

866, fn. 2.) The result which must be reached in this case

does not rest on ecclesiastical expertise, but rather on

principles of law. The question as to the jural status of

UMC is one of law and not of fact. (Ibid.; ef. Brandeburg v.

New York Tel. & Tel. Co. (1975) 49 Cal. App. 3d 893, 896;

Agalite-Bronson Co. v. K. G. Limited (1969) 270 Cal. App.

2d 308, 310.)

The Criteria to be Applied to Determine Whether an Entity

is Capable of Being Sued as an Unincorporated Association

A-6

“For a long time the established rule was that in the

absence of statute, an unincorporated association could

not sue or be sued in its common name; all the members

thereof had to appear in their own names as parties

plaintiff or defendant. The basic reason was that the

association was not, in the eyes of the law, a legal

unit or entity, and had no legal capacity to become a

party to an action. [Citations.] The difficulty was only

one of procedure, and the objection was purely tech-

nical. The liabilities or rights of the members were in

no way involved, and were not, in theory, impaired by

the operation of the rule. They might have brought

actions if they all joined as plaintiffs, and they might

have been held to any liability imposed upon them by

law, if sued and served individually. But where asso-

ciations with large membership were involved, the

operation of the rule frequently has inconvenient and

unjust consequences, and various exceptions came to

be recognized.” (Jardine v. Superior Court (1931) 213

Cal. 301, 307-308.)

Code of Civil Procedure section 388, enacted to eliminate

procedural problems in actions against an unincorporated

association, was held cunstitutional in Jardine v. Superior

Court, supra.

In its original form, only persons transacting business

under a common name could be sued in that name, but

“business” was ultimately construed so broadly it consti-

tuted a slight limitation on the right to sue an unincorpo-

rated association. (See Law Revision Commission Comment

(1967 Amend.) Herald v. Glendale Lodge No. 1289 (1920)

46 Cal. App. 325, 330.) The 1967 amendment to Code of

Civil Procedure section 388 made clear an unincorporated

association, whether organized for profit or not, could either

sue or be sued in the name which it had assumed or by which

it was known. The trend of case law has been the rejection

of legal niceties to assure full recognition of the unincorpo-

rated association as a separate legal entity. The basis for

a, eB ng SAL

‘

A-7

this rejection of procedural rigidity has been specifically

articulated in labor law disputes.

“The social and economic realities of the present-day

organization of society has thus led this court and

others to recognize the suability of unions. [footnote

omitted.] ... We must recognize that the society of

today rests upon the foundation of group structures

of all types, such as the corporation, the cooperative

society, the public utility. Such groups must, of course,

operate successfully within the society; one of the

prerequisites to that functioning is, generally, liability

to suit and opportunity for suit. To frustrate that

viability by the imposition of outmoded concepts would

be to impair the institutions as well as to impede the

judicial process.” (Daniels v. Sanitarium Assn., Inc.

(1963) 59 Cal. 2d 602, 607-608; see also Marshall v.

International Longshoremen’s & Warehousemen’s

Union (1962) 57 Cal. 2d 781.)

Statutory enactments in California involving the unincor-

porated association have been consistent with case law

development. In 1967 the Corporations Code was amended

to include the definition of unincorporated association as

“any partnership or other unincorporated organization of

two or more persons, whether organized for profit or

not....” (Corp. Code, § 24000, subd. (a).) It has been made

liable to third persons to the same extent as if the associa-

tion were a natural person (Corp. Code, § 24001) ; and may

protect its name and insignia (Corp. Code. §§ 21300-21310).

On a national basis, the trend continues to assure legal

status to organizations where in fairness it is appropriate.

For example, in State of Georgia v. National Democratic

Party (D.C. Cir. 1971) 447 F.2d 1271, cert. den. Oct. 12, 1971,

the National Republican Party, one of the named defend-

ants, was found to be an unincorporated association con-

trary to its argument that it was composed only of state

republican parties which acted in concert to conduct national

A-8

party business and that between the quadrennial conven-

tions, the Republican National Committee handled the

national affairs of the Republican National Convention. In

Ripon Society v. National Republican Party (D.C. Cir. 1975)

525 F.2d 567, responding to the assertion that “no such

national [Republican] party is formally constituted under

any state or federal law, and that the term is merely a

collective description of the individual state and territorial

Republican Parties,” the court said:

“We know, either from the record or through judicial

notice, that there is commonly understood to be a

National Republican Party, that it is commonly re-

ferred to, and contributed to, as such, that it meets

quadrennially in a national convention, and that at the

last such convention it formally declared itself ‘a

nationwide Party,’ whose ‘general management’ it en-

trusted to the Republican National Committee ‘subject

to direction from time to time of the National Conven-

tion.’” (id., at pp. 571-572, fn. 5.)

Groups which have been included as unincorporated asso-

ciations in addition to labor unions (United Mine Workers

of America v. Coronado Coal Co. (1922) 259 U.S. 344 [42

S.Ct. 570] ; Juneau Spruce Corp. v. I. L. 6 W. Union (1953)

119 Cal. App.2d 144) and political parties are social clubs,

religious organizations, environmental societies, athletic

organizations, condominium owners, lodges, stock exchanges

and veterans. The criteria applied to determine whether

5 See, for example, Moose Lodge No. 107 v. Irvis (1972) 407 US.

163 [92 S.Ct. 1965] (social club) ; Presbyterian Ch. v. Mary E. B.

Hull Mem. Pres. Ch. (1969) 393 U.S. 440 [89 S.Ct. 601] (church) ;

Alyska Pipeline Service Co. v. Wilderness Society (1975) 421 U.S.

240 [95 S.Ct. 1612] ; Friends of Mammoth v. Board of Supervisors

(1972) 8 Cal. 3d 247 (environmental societies) ; California State

University, Hayward v. National Collegiate Athletic Assn. (1975) 47

Cal. App. 3d 533 (athletic organization) ; White v. Cox (1971) 17

Cal. App. 3d 824 (condominium owners) ; Herald v. Glendale Lodge,

supra, 46 Cal. App. 325 (lodge) ; Jardine v. Superior Court, supra,

213 Cal. 301 (stock exchange) ; and Schlesinger v. Reservists Com-

mittee To Stop The War (1974) 418 U.S. 208 [94 S.Ct. 2925] .

(veterans).

A-9

an entity is an unincorporated association are no more

complicated than (1) a group whose members share a com-

mon purpose, and (2) who function under a common name

under circumstances where fairness requires the group be

recognized as a legal entity. Fairness includes those situa-

tions where persons dealing with the association contend

their legal rights have been violated. (See Operative

Plasterers’, Etc., Assn. v. Case (D.C. Cir. 1937) 93 F.2d 56,

65.) Formalities of quasi-corporate organization are not

required (Law v. Crist (1940) 41 Cal. App.2d 862, 865;

Estate of Irwim (1925) 196 Cal. 366, 372.) Courts have even

assessed liability against a church association with no

officers where there were only nine persons whose sole busi-

ness transaction (aside from small purchases of printed

religious material) was the purchase, by down payment, of

a station wagon. (Steuer v. Phelps (1974) 41 Cal. App.3d

468).

UMC contends an essential element for legal status, the

creation of associate liability in furtherance of the common

purpose (Jardine v. Superior Court, supra, 213 Cal. 301,

317) is absent in the instant case because all members and

connected bodies of the denomination have not delegated

agency authority to Pacific Homes to act on behalf of UMC.

This circuitous argument, however, assumes actual agency

must be conferred on Pacific Homes before any defendant

can be liable. Whether Pacific Homes had actual authority

to aet on behalf of UMC is unnecessary for the application

of doctrines relating to either alter ego or agency. To hold

otherwise would permit an unincorporated association to

escape liability by the simple technique of requiring express

consent from all units of the association.

The Organization of UMC

In resolving intra-church schisms or property disputes,

courts have identified at least two categories of church

A-10

polities ;> congregational and hierarchal. (See gen., Watson

vy. Jones (1872) 80 U.S. 679, 722 [74-81 S.Ct. 666]; Kedroff

v. St. Nicholas Cathedral of Russian O. Ch. (1952) 344 U.S.

94 [73 S.Ct. 143].) UMC is not congregational, i.e., the

local church is not the highest authority in all matters of

doctrine and usage. It is hierarchal; the 43,000 local

churches and 114 Annual Conferences are governed through

the structure described by the Book of Discipline of the

United Methodist Church (Discipline).? In United Method-

ism, “the local church is a part of the whole body of the

general church and is subject to the higher authority of the

organization and its laws and regulations.” (Carnes v.

Smith (1976) 222 S.E.2d 322, 325, cert. den. 429 U.S. 868.)

“The Methodist Church .. . is a connectional church,

governed by representative bodies, with an episcopacy

whose powers and duties are constitutionally defined.

It has an itinerant ministry in that its ministers are

assigned by officials of The Methodist Church and are

not called by local societies or subject to the control

or discipline of local societies. The basic representative

body of The Methodist Church is the Annual Confer-

ence made up of ministerial and lay delegates from local

societies in each area embraced within an Annual

Conference. An Annual Conference is divided for

purposes of administration into Districts. The admin-

istration of a District is entrusted to a District Super-

intendent. The General Conference of the Methodist

6 “Polity refers to the general governmental structure of a church,

the organs of authority and the allocation and locus of its judicatory

powers as defined by its own organic law.” (Brady v. Reiner (1973)

198 S.E.2d 812, 827; see also Note, Judicial Intervention in Disputes

Over the Use of Church Property (1962) 75 Harv. L. Rev. 1142,

1143-1144. )

7™“The content of the Discipline changes quadrennially. The con-

cept of the Discipline as setting forth the plan, polity and process

by which United Methodists govern themselves remains constant...”

(Discipline (1976) Episcopal Greetings, p. v.)

A-11

Church, made up of delegates from each Annual Con-

ference of the Church, is the highest legislative body

of the Church, determining the ecclesiastical and tem-

poral policies of the Church. The Judicial Council is

the highest judicatory body of the Church, deciding

appeals taken on legal issues raised within the Church.

The Discipline of The Methodist Church is the book

of law of the Church containing the Articles of Religion,

the Constitution, the rules of the church concerning

the moral conduct of its members, and the legislation

of the various General Conferences defining the form

of government, the duties, powers and privileges of the

members, ministers and various bodies of the Church,

including the law of the Church with reference to the

acquisition, conveyancing and alienation of real estate.”

(Goodson v. Northside Bible Church (1966) 261 F.Supp.

99, 101.)

UMC may be unique in that it has no single chief operat-

ing officer, but the clearly defined operating and conceptual

levels of responsibility starting with the General Confer-

ence, “[t]he legislative body for the entire Church” (Disci-

pline, Glossary, p. 598), the Annual Conference, the District

Conference, the Charge Conference, the Local Church Con-

ference and the local church cannot be ignored. Moreover,

a persuasive argument can be made that the Council of

Bishops is equivalent to the board of directors of UMC.

According to the Book of Discipline, the “Council of

Bishops is thus the corporate expression of episcopal lead-

ership in the Church” which is required “to meet at stated

intervals” in order to oversee “the spiritual and temporal

affairs of the whole Church.” (Discipline, par. 525.)

Control over the local church ranging from the restric-

tions on purchase or sale of estate which requires authori-

zation from the Charge Conference and the written consent

of the pastor and district superintendent (Discipline, par.

2429, 2431, 2433, pp. 547-549) to the selection of local church

A-12

pastors is more reflective of a single entity than completely

autonomous and independent units.

The day to day operation of UMC is in keeping with the

reality of its organization. The GCF A, characterized by

UMC in this appeal as merely a non-discretionary conduit

rendering non-discretionary auditing and financial service

to some of the general level agencies with United Method-

ism, has in fact held itself out somewhat differently. In

applying for a group exemption under section 501(c) of the

Internal Revenue Code of 1954, GCFA described itself as

“the central treasury and fiscal agent of the United Meth-

odist Church. The Council has been established by the

General Conference to act as its finance committee and

accordingly its duties are legislated in Paragraphs 837-865

of the Book of Discipline.” In that application, the GCFA

made reference to paragraph 843.3 of Discipline which

authorizes GCFA “to take all necessary legal steps to safe-

guard and protect the interest and rights of the United

Methodist Church.” A reasonable legal inference which can

be drawn from this grant and description of authority to an

agent is the existence of UMC as principal. This is par-

ticularly true where that agent, in addition to being account-

able for “all matters relating to the receiving, disbursing,

and reporting of general church funds” ® (Discipline, par.

906, p. 333) ; is required “[t]o take all necessary legal steps

to safeguard and protect the interests and rights of The

United Methodist Church; to maintain a file of legal briefs

related to cases involving The United Methodist Church,

and to make provisions for legal counsel where necessary in

8 Approximately five and one-half percent of total member con-

tributions are given annually to GCFA. In “What Happens To All

That Money?” (1977 ed.) United Methodist Communications, Dr.

Ewing T. Wayland, described as the treasurer of UMC, said: “In

1975, United Methodists giving to the support of the general church

totaled $58,155,600—5.38 percent of the total amount paid by local

churches for all purposes.” (at p. 5)

A-13

order to protect the interests of the Church at the request

of a general agency or a bishop, as the Council deems ad-

visable.” (Discipline, par. 907, subpar. 4, pp. 338-339). In

addition to the cases cited previously (Carnes v. Smith,

supra, 222 §.E. 2d 322; Brady v. Reiner, supra, 198 S.E.

2d 812; Goodson v. Northside Bible Church, supra, 261

F.Supp. 99, affd. 387 F.2d 534 (5th Cir. 1967)), UMC has

appeared as principal in other litigation. (See United Meth.

Ch. v. St. Lowis Crossing Ind. Meth. Ch. (1972) 276 N.E. 2d

916; The United Methodist Church, Dr. McCoy Johnson, in

his representative capacity as the District Superintendent

of the American District of the South Georgia Annual Con-

ference, ete. v. J. W. Sparrow, Civil Action No. 6881

(Superior Court of Dooly Co., Georgia, 1976).)® Other

cases in which an agency of the UMC has been involved

reiterate the hierarchal and organizational structure of

Methodism. (See, e.g. Hoffman v. Tieton View Community

M. E. Church (1949) 34 Wash. 2d 83, 207 P.2d 699, 705-706 ;

Trustees of Peninsula Annual Conference v. Spencer (1962)

183 A.2d 588, 589; Turbeville v. Morris (1943) 203 S.C. 287,

26 S.E. 2d 821, 825.)

The possibility of UMC’s liability has not gone unnoticed

by those responsible for insurance coverage. UMC is a

named insured on a high limit contract of insurance com-

mencing June 1, 1976 to June 1, 1979, with a broad range

of fidelity, casualty, property, fire, theft, medical malprac-

tice and comprehensive general liability coverage. The

policy as issued describes UMC as a corporation engaged in

business as a religious organization.

® We are aware that counsel for UMC in the Georgia case filed his

affidavit indicating the decison to include UMC as plaintiff was his

alone. Whether actually authorized or not, the belief by UMC’s own

lawyer as to the jural status of UMC is certainly relevant to our

inquiry.

A-14

In summary, UMC is a highly organized religious body

working through specific agencies to accomplish laudable

goals.

The Relationship Between Pacific Homes and UMC

Requires UMC be Recognized as a Legal Entity

Before we examine the circumstances surrounding the

activities of Pacific Homes and the alleged involvement of

UMC, we wish to stress that our decision in the pleading

phase of this litigation does not imply any lack of com-

passion by UMC or infer liability on its part. Our holding

based upon neutral principles of law simply determines

UMC is suable. What the outcome of that suit will be or

should be is not before us.

Pacific Homes, a non-profit organization, was formed in

1929 by the Southern California Annual Conference (the

predecessor of the PSWAC) of the Methodist Episcopal

Church. Amended Articles of Incorporation signed in Jan-

uary 1929 expressly provided that the powers of the cor-

poration subject to California law shall be “subject to the

uses and Discipline of The Methodist Church as from time

to time authorized and declared by the General Conference

of said Church and by the Annual Cenference within whose

bounds the said corporation is located.” The articles also

provided that before either voluntary or involuntary dis-

solution, the corporate assets shall be subject to the Annual

Conference of the Methodist Church or its successors; by-

laws adopted or amended shall not be inconsistent with the

Book of Discipline; and membership in the corporation was

restricted to the Southern California-Arizona Annual Con-

ference of the Methodist Church.

The relationship between Pacific Home: and UMC has

continued since 1929 in a similar fashion. Through the

years, the Board of Directors of Pacific Homes has been

A-15

either appointed by the Methodist Church’s Annual Con-

ference in Southern California or composed of Methodist

ministers and lay persons of the Annual Conference.

In the first List of Hospitals and Homes of The Methodist

Chureh published in 1967 by the Methodist Health and

Welfare Certification Council of the Board of Hospitals

and Homes of the Methodist Church, Pacific Homes was

given affiliate status, the highest level attainable for that

year. In addition to its relationship with UMC, certification

established the quality of services rendered by Pacific

Homes met the minimum basic standards for professional

health and welfare services recognized by the General

Board of Hospitals and Homes of the Methodist Church.

Until financial difficulties started, the successful perform-

ance by Pacific Homes was pointed to with pride over a

number of years in many public statements by the Presi-

dent of UMC’s Council of Bishops.

The literature prepared by Pacific Homes distributed to

persons interested in either a convalescent hospital or a

retirement residence expressly stated that Pacific Homes

was an agency of the United Methodist Church Southern

California-Arizona Conference. In describing the cost,

Pacific Homes referred to itself as being sponsored by the

Southern California-Arizona Conference of the United

Methodist Church and offered a special program of assist-

ance to help a limited number of United Methodists.

Plaintiffs’ complaint mirrors the literature of Pacific

Homes alleging agency, sponsorship and control over

Pacific Homes.

The events referred to in the pleadings and described in

the documents presented to the trial court refer to activ-

ities which not only involve spiritual concerns relating to

the health and welfare of either the elderly or infirm, but

A-1o

which are commercial activities. ‘The costs for lodging and

the type of accommodations are primarily business deci-

sions. UMC, in fulfilling its commitment to society, has

elected to involve itself in worldly activities by participat-

ing in many socially valuable projects. It has enjoyed the

benefits, both economic and spiritual, of those projects. It

has even on occasion filed suit for the protection of its

interests. It must now, as part of its involvement in society,

be amenable to suit.

Due Process of Law Does Not Preclude UMC

From Being Sued

UMC argues the due process implications of this case

are inescapable. If suit against UMC is permitted, the

assets of the scores of thousands of United Methodist in-

stitutions throughout the world having no contacts with

either California or Pacific Homes will be subject to levy—

a constitutionally impermissible result because distant

Methodist units would have been unable to defend them-

selves on the merits of the controversy.

The complexities, both legal and factual, in the present

litigation are immense. To ada a constitutional require-

ment, however, that before UMC can be recognized as an

entity, plaintiffs must also identify each asset that may be

reached to assure the absence of any third party claim in

that asset, is to create an issue where one does not exist.

We recognize the inextricable relationship between obtain-

ing a judgment and having it satisfied; nevertheless, to

adjudicate questions on ownership of property before judg-

ment is essentially a reversal in the process of litigation.

The due process issue described by UMC is reflected in

Code of Civil Procedure section 388, subdivision (b), which

provides:

;

5 AEDS ARE sills i rt

‘

A-17

“Any member of the partnership or other unincorpo-

rated association may be joined as a party in an action

against the unincorporated association. If service of

process is made on such member as an individual,

whether or not he is also served as a person upon whom

service is made on behalf of the unincorporated asso-

ciation, a judgment against him based on his personal

liability may be obtained in the action, whether such

liability may be joint, joint and several, or several.”

Before any liability can be assessed against any person,

service of process on the individual in his individual capac-

ity must be made. Plaintiffs concede that no individual has

been sued by virtue of membership in the UMC. California

Corporations Code section 24002 provides: “Only the prop-

erty of an unincorporated association may be levied upon

under a writ of execution issued to enforce a judgment

against the association.” Corporations Code section 21102

provides further that:

“No presumption or inference existed prior to Septem-

ber 15, 1945, or exists after that date, that a member of

a nonprofit association has consented or agreed to the

incurring of any obligation by the association, from

the fact of joining or being a member of the association,

or signing its by-laws.”

An action against an association sued in its common name

is an action against a single defendant. (Potts v. Whitson

(1942) 52 Cal. App. 2d 199, 205.) California statutes provide

due process safeguards in those situations unlike the case at

bench where liability is sought to be imposed against indi-

divdual units of the UMC neither named as a party nor

served.

The Action Against UMC Does not Violate the Free Exercise

and Establishment of Religion Provisions of the United

States and California Constitutions

We have previously stated that UMC’s status in the con-

text of this appeal is a question of law, thus rejecting the

A-18

ecclesiastical expertise furnished by persons knowledgeable

in the history, development and faith of United Methodism.

Whether we may do so is challenged by UMC under both the

Federal and State Constitutions.” UMC contends the First

and Fourteenth Amendments prevent a civil court from

independently examining its polity to conclude it is suable

contrary to church doctrine.

There are situations specifically in internal church dis-

putes where civil courts are required to accept the decision

of the highest body of the church.

“[ T]he First and Fourteenth Amendments permit hier-

archal religious organizations to establish their own

rules and regulations for internal discipline and gov-

ernment, and to create tribunals for adjudicating dis-

putes over these matters. When this choice is exercised

and ecclesiastical tribunals are created to decide dis-

putes over the government and direction of subordinate

bodies, the Constitution requires that civil courts ac-

cept their decisions as binding upon them. (Serbian

Eastern Orthodox Diocese v. Milivojevich (1976) 426

U.S. 696, 724-725)

This rule, however, has not been extended into secular dis-

putes. Clearly the present case is secular. To defer abso-

lutely to authoritative church experts would be to grant

7° Amendment I of the U. S. Constitution provides in pertinent

part:

“Congress shall make no law respecting an establishment of reli-

gion, or prohibiting the free exercise thereof. . . .”

Article I, section 4 of the California Constitution provides in perti-

nent part:

“Free exercise and enjoyment of religion without discrimination

or preference are guaranteed. This liberty of conscience does

not excuse acts that are licentious or inconsistent with the peace

or safety of the State. The Legislature shall make no law re-

specting an establishment of religion.”

ts dks oat

AS eR th

Jae i edice.

A-19

immunity to religious organizations in cases which might

arise far afield from religious activities with the resultant

effect that civil courts would then be subordinated to organ-

izations which might attempt to classify themselves as reli-

gious to obtain the benefits of the shield of First Amendment

protection.

California cases addressing this issue outside the realm

of intra-church disputes have held that civil courts are not

bound by achurch’s constitution or its ecclesiastical doctrine.

(Queen of Angels Hospital v. Youngér (1977) 66 Cal. App.

3d 359, 372; In re Metropolitan Baptist Church of Richmond,

Inc. (1975) 48 Cal. App. 3d 850, 859.)

To hold UMC suable is not equivalent to a review of its

polity thus interfering with its internal affairs in violation

of the free exercise clause of the First Amendment. There

is no evidence to show that rendering UMC amenable to suit

would affect the distribution of power or property within

the denomination, would modify or interfere with the modes

of worship affected by Methodists or would have any effect

other than to oblige UMC to defend itself when sued upon

civil obligations it is alleged to have incurred. The cases

involving UMC entities previously cited eliminates any idea

there may be religious prohibitions to participation in civil

litigation.

We are keealy aware of the church-state separation artic-

ulated both in our State Constitution (see Fox v. City of

Los Angeles (1978) 22 Cal. 3d 792, 799-806, cone. opn. of

Bird, C.J.) and Federal Constitution. We have kept firmly

in mind the clauses pertaining to religious freedom are

aimed at preserving government neutrality in matters per-

taining to religion while securing religious goals free of

government restraints. We have considered each clause for-

bids two quite different kinds of governmental encroachment

A-20

upon religious freedom. (See Engle v. Vitale (1962) 370 US.

421, 430 [82 S.Ct. 126] ; see also School District of Abington

Tp., Pa. v. Shempp (1936) 374 U.S. 203, 221 [83 S.Ct. 1560].)

Nevertheless, nothing either our State or Federal Supreme

Court has said has even remotely implied that “under the

cloak of religion, persons may, with impunity, commit fraud

upon the public.” (Cantwell v. State of Connecticut (1940)

310 U.S. 296, 306 [60 S.Ct. 900].) The free exercise clause

of the First Amendment which assumes the absolute free-

dom to believe does not grant absolute freedom to act. Con-

duct remains subject to regulation for the protection of

society. (Cantwell, supra, at pp. 303-304.) Conduct, albeit

based upon religious motivation, may be res*ricted by neu-

tral legislation. (Braunfeld v. Brown (1961) 336 U.S. 599,

603 [81 S.Ct. 1144]; Reynolds v. United States (1879) 98

U.S. 145 [95-105 S.Ct. 244].) To permit unbridled behavior

“would be to make the professed religious belief superior to

the law of the land, and in effect, to permit every citizen to

become a law onto himself. Government could exist only in

name under such circumstances.” (id., at pp. 166-167.) To

apply a different standard to determine the jural status of

religious organizations as opposed to non-religious organ-

izations in purely secular suits might very well constitute

a preference for religion in violation of the establishment

clause. (School District of Abington Tp., Pa. v. Shempp,

supra, 374 U.S. 203.)

The trial court order reflected the concern that if indi-

vidual members of a church were to be liable there would

be a chilling effect on church membership. This concern,

legitimate as it may be, is properly placed with the religious

body to consider before becoming involved in commercial

affairs and is not a consideration which may be considered

in our resolution of the issue before us. A religious organi-

zation should not be relieved of its lawful obligations arising

Gaeta la Sis See Tai SB: 1d SIG BIA AREA nh ARG A a

A-21

out of secular activities because the satisfaction of those

obligations may, in some tangential fashion, discourage

religious activities. (See Gospel Army y. City of Los

Angeles (1945) 27 Cal. 2d 232, 241-247.)

The statutory enactments involved in this action are for

the purpose of providing substantive rights to citizens and

to assure access to the courts, including the right to sue

organizations functioning as unincorporated associations.

The internal ecclesiastical judicial system of UMC dees not

provide any method of redress for plaintiffs. The use of the

courts as a method of dispute resolution cannot be fore-

closed to this class of plaintiffs who have alleged fraud,

breach of contract and statutory violations because one of

the named defendants is a religious body. Neither the State

nor Federal Constitution may be interpreted in a manner

which would deny plaintiffs the right to sue UMC.

Judgment reversed.

CERTIFIED FOR PUBLICATION.

' Wiener

WE CONCUR:

Staniforth

Acting P.J.

Ehrenfreund

J.” * Judge of the Superior Court of San

Diego County sitting under assign-

ment by the Chairperson of the

Judicial Councel.

A-22

APPENDIX B

Minute Order Decision

SUPERIOR COURT OF CALIFORNIA,

COUNTY OF SAN DIEGO

FRANK T. BARR, et al.,

Plaintiffs,

No. 404611

vs.

> MINUTE

ORDER

THE UNITED METHODIST CHURCH,

et al.,

Defendants.

THE UNITED METHODIST CHURCH

The “United Methodist Church” is an international re-

ligious denomination consisting of over 10,000,000 persons

who worship in some 43,000 churches and missions through-

out the world. The “United Methodist Church” is a “con-

nectional” structure maintained through a chain and series

of periodic conferences. It has never been incorporated.

A respected unbiased source, “The Encyclopedia Britan-

nica”, 1959 Ed., Vol. 15, p. 358, states : “Methodism has con-

tinued for more than two centuries to proclaim a freedom

of spirit as opposed to the bondage of an organization, and

its appeal has been based on the reality of a personal expe-

rience of spiritual emancipation through faith in Christ.”

The Court rules that: “The United Methodist Church”

is no more than a “spiritual confederation” and is not a

jural entity or unincorporated association subject to suit

under Code of Civil Procedure 388. A contrary ruling would

effectively destroy Methodism in this country, and would

have a chilling effect on all churches and religious move-

A-23

ments by inhibiting the free association of persons of

similar religious beliefs. If all members of a particular

faith were to be held personally liable for the transgres-

sions of their fellow churchmen, church pews would soon

be empty and the pulpits of America silent.

Accordingly, the motion to quash service of process on

“The United Methodist Church” is granted.

/s/ Ross G. THarp

Judge of the Superior Court

A-24 A-25

APPENDIX C Page 13, line 7, insert “real”; “. .. sale of real estate...”

COURT OF APPEAL—STATE OF CALIFORNIA Page 15, line 2, delete “Methodism” and insert “UMC.”

FOURTH APPELLATE DISTRICT Page 22, line 5, delete period after “freedom,” lowercase

DIVISION ONE “s” in “(See,” delete period after “1560],” and lowercase

COURT OF APPEAL, FOURTH DIST. “n” in “Nevertheless.” :

none t, FOND Cer Praag

R.J.SMITH Acting Presiding Justice

DEPUTY CLERK Copies to:

Witwer, Moran, Burlage &

; 5 Atkinson—Chicago

FRANK T. BARR, et al., Sullivan, Jones & Archer—SD L.A.D.J.

Plaintiffs-Appellants, Musick, Peeler & Garrett—LA B.W.

4 Civil O’Melveny & Myers—LA Trial Judge

vs. q Po: tsa Le : a L.A. County Law Lib.

ied, Gra ford—SD D.

THE UNITED METHODIST CHURCH, init: Milberg, Weiss, beschad : The id nai

et al., Specthrie—SD

Defendants-Respondents. Superior Court—SD

- West Publ. Co.

BY THE COURT

The petition for rehearing is denied.

The following corrections are made:

Page 1, line 5 from bottom, “Le’Estrange” should be

“L’Estrange.”

Page 1, line 2 from bottom, omit “Musick, Peeler & Gar-

rett, William McD. Miller III and Wayne B. Littlefield;

Hughes, Hubbard & Reed, William H. Levit, Jr.”

Page 2, line 1, omit “and John H. Blue”. Page 2, line 3,

omit “Defend.nt and Respondent” and insert “National

Council of Churches of Christ of United States of America.”

Page 2, line 5, delete “Kadison, Pfaelzer, Woodard, Quinn

& Rossi and Allen Woodard.”

Page 6, line 8, “t” should be “T” in “The Book of Dis-

cipline...”

Page 8, line 5 from bottom, should read “. . . cert. den.

404 U.S. 858 (Oct. 12, 1971),...”

mmc

A-26

APPENDIX D

CLERK’S OFFICE, SUPREME COURT

4250 State Building

San Francisco, California 94102

A-27

APPENDIX E

THE UNITED METHODIST CHURCH

Judicial Council

PRESIDENT

TOM MATHENY

P.O. Box 221

Hammond, Louisiana 70401

VICE PRESIDENT

May 17, 1979 TRUMAN W. POTTER

Cae We san

I have this day filed Order Charleston, W. Va.

SECRETARY

HOOVER RUPER':

212 South Park Street

Kalamazoo, Michigan 49006

As Secretary of the Judicial Council of the United Methodist

HEARING DENIED Church, I certify that the following decision was rendered

by the Council in session May 25, 1979 in Chicago, Illinois:

IN RE: AUTHORITY OF THE GENERAL COUNCIL

ON FINANCE AND ADMINISTRATION TO

REPRESENT THE UNITED METHODIST

CHURCH IN LITIGATION.

In re: 4 Civ. No. 18244 DECISION: Paragraph 907.4 of the 1976 Discipline does

Barr et al., not delegate to the General Council on Ad-

vs. ministration and Finance either the authority

: or the duty to sue, or to file an answer or to

United Methodist Church, et al. otherwise plead, on behalf of the United

Respectfully, Methodist Church as a denomination.

This is Decision No. 458 of the Judicial Council, and is dated

ie age in our records, May 25, 1979.

DR. HOOVER RUPERT

Secretary, The Judicial Council

The United Methodist Church

Certified, May 29, 1979.

Kalamazoo, Michigan

CHARLES B. COPHER ELIZABETH B. GENE E. SEASE

3340 Lake Valley Rd. N.W. GUNDLACH 1400 East Hanna Ave.

Atlanta, Georgia 30331 326 East Main Street Indianapolis, Ind. 46227

Springville, N.Y. 14141

PAUL A. DUFFEY FLORENCE V.LUCAS LEONARD D. SLUTZ

P.O. Box 6128 (Mrs. D. Rex Edwards) 900 Tri State Bldg.

Montgomery, Alabama 36106 144-07 228th Street Cincinnati, Ohio 45202

Rosedale, N.Y. 11413

OT ee ee "

A-28

APPENDIX F

WITWER, MORAN, BURLAGE & ATKINSON

Samuel W. Witwer, Sr.

Samuel W. Witwer, Jr.

125 South Wacker Drive, Suite 2700

Chicago, Ilinois 60606

(312) 332-6000

SULLIVAN, JONES & ARCHER

Allan J. Reniche

Daniel R. Salas

William F. Fahey

1400 Financial Square

600 “B”’ Street

San Diego, California 92101

(714) 236-1611

Attorneys For The Persons Upon Whom

Service Of Process Was Attempted On

Behalf Of The United Methodist Church

SUPERIOR COURT

OF THE STATE OF CALIFORNIA

FOR THE COUNTY OF SAN DIEGO

FRANK T. BARR, et al., 7

Plaintiffs,

vs.

THE UNITED METHODIST

CHURCH, et al.,

Defendants. No. 404611

ANSWER TO

GEORGE HALL, et al., CONSOLIDATED

Intervenors, COMPLAINT

vs.

THE UNITED METHODIST

CHURCH, et al.,

Defendants In

Intervention. |

PAUL W. MILHOUSE, CHARLES F. GOLDEN and

JAMES M. WALTON-MYERS, on their motion to quash

A-29

having been determined by the California courts to be

representatives of the alleged unincorporated association

described and designated in Paragraph 2 of the Consoli-

dated Amended Complaint as “The United Methodist

Church,” while continuing to deny that they are such rep-

resentatives, and denying that the United Methodist re-

ligious denomination has capacity or duty to answer as

an unincorporated association under its polity and ecclesi-

astical law, or under the due process and freedom of reli-

gion protections afforded by the California Constitution

and the First, Fifth and Fourteenth Amendments to the

Constitution of the United States, now cause “The United

Methodist Church,” as described in Paragraph 2 of the

Consolidated Amended Complaint, not voluntarily but under

protest, solely to comply with the mandate of the civil

courts of California and to avoid the entry of a default,

to answer as follows:

Pursuant to California Code of Civil Procedure, {| 431.30,

each and every allegation of the Consolidated Amended

Complaint (“Complaint”) is denied.

AFFIRMATIVE DEFENSES

Without waiving the general denial set forth above and

continuing to deny each and every allegation of the Com-

plaint, the following affirmative defenses are asserted:

FIRST AFFIRMATIVE DEFENSE TO

ALL CAUSES OF ACTION

1. By its written opinion on March 8, 1979, in Barr v.

United Methodist Church, 90 Cal. App. 3d 259, 153 Cal.

Rptr. 322, the California Court of Appeal, Fourth Appellate

District, Division One, reinstated The United Methodist

Church as a named defendant in this action, holding thet

it can be sued as an unincorporated association. The

California Supreme Court denied hearing on May 17, 1979.

OEE eee

A-30

2. On May 25, 1979, the Judicial Council of The United

Methodist Church ruled that neither the General Council

on Finance and Administration of The United Methodist

Church, nor any other person, is empowered to answer,

or otherwise appear in legal proceedings on behalf of the

United Methodist denomination as a totality, since the

chosen polity of that denomination is not centrally directed,

and, under the constitution of United Methodism (The Book

of Discipline, at Paragraph 612), no person or unit may

presume to officially represent, speak for or bind the

thousands of separate religious units comprising the de-

nomination. A copy of the Slip Opinion of the Judicial

Council, now in the process of printing and publication, is

attached hereto marked Exhibit “A”, and incorporated by

reference herein.

3. Upon application by the individuals served, the Su-

perior Court for the County of San Diego granted the

named denominational defendant an extension of time to

plead until July 2, 1979.

4. Given their understanding that none of them is em-

powered to receive service of process on behalf of The

United Methodist Church, that they are unable to speak for

the denomination, and that the denomination, because of

the nature of its chosen polity, lacks capacity to litigate

as a unity and legal entity, the individuals served on behalf

of The United Methodist Church are in the process of pre-

paring a Petition For Writ Of Certiorari for filing in the

United States Supreme Court, seeking review of the Cali-

fornia appellate decision that The United Methodist Church

can be sued as an unincorporated association. That petition

will assert that The United Methodist Church is an inter-

national religious denomination and spiritual confederation

but is not, either under ecclesiastical law or under federal

or state constitutional principles, a single legal entity.

A-31

0. The conflict between the chosen religious polity and

ecclesiastical law of United Methodism and the decision of

the Fourth Appellate District, Division One, of the Cali-

fornia Court of Appeal, must be resolved after July 2, 1979,

the last day the Superior Court will allow The United

Methodist Church to file responsive pleadings. The indi-

viduals served are not prepared to allow The United

Methodist Church to suffer entry of a default in a case

alleged to involve hundreds of millions of dollars in damages,

solely because they honestly and steadfastly believe they

have no authority to speak for the denomination, and that

the denomination lacks capacity to litigate as a single entity.

6. The individuals served, therefore, file this Answer

under protest. The requirement that they submit an answer

on behalf of The United Methodist Church violates the due

process of law and freedom of religion provisions of the

California Constitution and the First, Fifth and Fourteenth

Amendments to the United States Constitution. All juris-

dictional objections which have been tendered to the civil

courts to date, including, without limitation (a) matters

which may be raised upon Petition For Writ of Certiorari

in the United States Supreme Court, described in Para-

graph 4 hereinabove, and (b) any post-judgment review

herein which may become appropriate, are specifically

reserved.

SECOND AFFIRMATIVE DEFENSE TO

ALL CAUSES OF ACTION

7. The allegations of paragraphs 1 through 5 of the First

Affirmative Defense are referred to and incorporated by

reference herein as though fully set forth.

8. The requirement that The United Methodist Church

be restructured and its ecclesiastical law be ignored so as

to conduct litigation as a monolithic unit, rather than pre-

A.-32

serving the denomination’s integrity as a spiritual con-

federation is objected to. The individuals served specifically

disclaim the capacity of The United Methodist Church to

be or become an unincorporated association. Such inter-

pretation and requirement is violative of the due process

of law and freedom of religion provisions of the California

Constitution and the First, Fifth and Fourteenth Amend-

ments to the United States Constitution.

THIRD AFFIRMATIVE DEFENSE

TO ALL CAUSES OF ACTION

9. The allegations of paragraphs 1 through 5 of the First

Affirmative Defense are referred to and incorporated by

reference herein as though fully set forth.

10. Neither the individuals nor the purported unincor-

porated association, The United Methodist Church, as de-

scribed in Paragraph 2 of the Complaint possess (a) any

authority to speak for or represent, or (b) any power to

issue directions to the following constituent units and per-

sons of United Methodism which have separate identities,

substantial autonomy, and their own distinct decision mak-

ing mechanisms:

a. Approximately ten million individual adherents

of United Methodism throughout the world;

b. Local Churches; a total of approximately 39,000

in the United States, and approximately 4,400 over-

seas;

e. Jurisdictional and Central Conferences; Five

Jurisdictional Conferences as follows:

NORTH CENTRAL JURISDICTION (U.S.)

NORTHEASTERN JURISDICTION (U.S.)

SOUTH CENTRAL JURISDICTION (U.S.)

SOUTHEASTERN JURISDICTION (U:S.)

WESTERN JURISDICTION (U.S.)

A-33

Nine overseas Central Conferences, as follows:

AFRICA CENTRAL CONFERENCE

LIBERIA CENTRAL CONFERENCE

CHINA CENTRAL CONFERENCE

CENTRAL AND SOUTHERN EUROPE

CENTRAL CONFERENCE

CENTRAL CONFERENCE IN THE GERMAN

DEMOCRATIC REPUBLIC

CENTRAL CONFERENCE IN THE

FEDERAL REPUBLIC OF GERMANY

AND WEST BERLIN

NORTHERN EUROPE CENTRAL

CONFERENCE

SOUTHEAST ASIA-PHILIPPINE CENTRAL

CONFERENCE

SOUTHERN ASIA CENTRAL CONFERENCE

d. Annual Conferences: A total of seventy-three

(73) in the United States as follows:

PACIFIC AND SOUTHWEST ANNUAL

CONFERENCE (“PSWAC”), a California not-

for-profit corporation, named as a defendant here-

in and represented by its own counsel, ALABAMA-

WEST FLORIDA ANNUAL CONFERENCE,

ALASKA MISSIONARY ANNUAL CONFER.

ENCE, BALTIMORE ANNUAL CONFER.

ENCE, CALIFORNIA-NEVADA ANNUAL

CONFERENCE, CENTRAL ILLINOIS AN-

NUAL CONFERENCE, CENTRAL NEW

YORK ANNUAL CONFERENCE, CENTRAL

PENNSYLVANIA ANNUAL CONFERENCE,

CENTRAL TEXAS ANNUAL CONFERENCE,

DETROIT ANNUAL CONFERENCE, EAST

OHIO ANNUAL CONFERENCE, EASTERN

PENNSYLVANIA ANNUAL CONFERENCE,

FLORIDA ANNUAL CONFERENCE, HOUS.

TON ANNUAL CONFERENCE, IOWA AN-

A-34

NUAL CONFERENCE, KANSAS-EAST AN-

NUAL CONFERENCE, KANSAS WEST

ANNUAL CONFERENCE, KENTUCKY AN-

NUAL CONFERENCE, LITTLE ROCK AN-

NUAL CONFERENCE, LOUISIANA ANNUAL

CONFERENCE, LOUISVILLE ANNUAL CON-

FERENCE, MAINE ANNUAL CONFERENCE,

MEMPHIS ANNUAL CONFERENCE, MINNE-

SOTA ANNUAL CONFERENCE, MISSISSIPPI

ANNUAL CONFERENCE, MISSOURI-EAST

ANNUAL CONFERENCE, MISSOURI-WEST

ANNUAL CONFERENCE, NEBRASKA AN-

NUAL CONFERENCE, NEW HAMPSHIRE

ANNUAL CONFERENCE, NEW MEXICO AN-

NUAL CONFERENCE, NEW YORK ANNUAL

CONFERENCE, NORTH ALABAMA ANNUAL

CONFERENCE, NORTH ARKANSAS AN-

NUAL CONFERENCE, NORTH CAROLINA

ANNUAL CONFERENCE, NORTH DAKOTA

ANNUAL CONFERENCE, NORTH GEORGIA

ANNUAL CONFERENCE, NORTH INDIANA

ANNUAL CONFERENCE, NORTH MISSIS-

SIPPI ANNUAL CONFERENCE, NORTH

TEXAS ANNUAL CONFERENCE, NORTH-

ERN ILLINOIS ANNUAL CONFERENCE,

NORTHERN NEW JERSEY ANNUAL CON-

FERENCE, NORTHERN NEW YORK AN-

NUAL CONFERENCE, NORTHWEST TEXAS

ANNUAL CONFERENCE, OKLAHOMA AN-

NUAL CONFERENCE, OKLAHOMA INDIAN

MISSIONARY ANNUAL CONFERENCE,

OREGON-IDAHO ANNUAL CONFERENCE,

PACIFIC NORTHWEST ANNUAL CONFER-

ENCE, PENINSULA ANNUAL CONFER-

ENCE, PUERTO RICO ANNUAL CONFER-

ENCE, RED BIRD MISSIONARY ANNUAL

CONFERENCE, RIO GRANDE ANNUAL CON-

FERENCE, ROCKY MOUNTAIN ANNUAL

CONFERENCE, SOUTH CAROLINA ANNUAL

A-35

CONFERENCE, SOUTH DAKOTA ANNUAL

CONFERENCE, SOUTH GEORGIA ANNUAL

CONFERENCE, SOUTH INDIANA ANNUAL

CONFERENCE, SOUTHERN ILLINOIS AN-

NUAL CONFERENCE, SOUTHERN NEW

ENGLAND ANNUAL CONFERENCE, SOUTH-

ERN NEW JERSEY ANNUAL CONFER-

ENCE, SOUTHWEST TEXAS ANNUAL CON-

FERENCE, TENNESSEE ANNUAL CONFER-

ENCE, TEXAS ANNUAL CONFERENCE,

TROY ANNUAL CONFERENCE, VIRGINIA

ANNUAL CONFERENCE, WEST MICHIGAN

ANNUAL CONFERENCE, WEST OHIO AN-

NUAL CONFERENCE, WEST VIRGINIA AN-

NUAL CONFERENCE, WESTERN NEW YORK

ANNUAL CONFERENCE, WESTERN NORTH

CAROLINA ANNUAL CONFERENCE, WEST-

ERN PENNSYLVANIA ANNUAL CONFER-

ENCE, WISCONSIN ANNUAL CONFERENCE,

WYOMING ANNUAL CONFERENCE, YEL-

LOWSTONE ANNUAL CONFERENCE.

A total of 43 overseas Annual Conferences as fol-

OWS:

ANGOLA ANNUAL CONFERENCE

CENTRAL ZAIRE ANNUAL CONFERENCE

NORTH SHALA ANNUAL CONFERENCE

RHODESIA ANNUAL CONFERENCE

SOUTHEAST AFRICA ANNUAL

CONFERENCE

SOUTHERN ZAIRE ANNUAL CONFERENCE

LIBERIA ANNUAL CONFERENCE

CHINA MAINLAND CONFERENCES

AUSTRIA PROVISIONAL CONFERENCE

BULGARIA PROVISIONAL CONFERENCE

CZECHOSLOVAKIA ANNUAL CONFERENCE

HUNGARY PROVISIONAL CONFERENCE

POLAND ANNUAL CONFERENCE

A-36

SWITZERLAND-FRANCE ANNUAL

CONFERENCE

YUGOSLAVIA PROVISIONAL CONFERENCE

GERMAN DEMOCRATIC REPUBLIC

ANNUAL CONFERENCE

GERMAN NORTHWEST ANNUAL

CONFERENCE

GERMAN SOUTH ANNUAL CONFERENCE

GERMAN SOUTHWEST ANNUAL

CONFERENCE

BALTIC PROVISIONAL CONFERENCE

DENMARK ANNUAL CONFERENCE

FINLAND-FINNISH PROVISIONAL

CONFERENCE

FINLAND-SWEDISH PROVISIONAL

CONFERENCE

NORWAY ANNUAL CONFERENCE

SWEDEN ANNUAL CONFERENCE

MIDDLE PHILIPPINES ANNUAL

CONFERENCE

MINDANAO ANNUAL CONFERENCE

NORTHEAST PHILIPPINES ANNUAL

CONFERENCE

NORTHWEST PHILIPPINES ANNUAL

CONFERENCE

PHILIPPINES ANNUAL CONFERENCE

SOUTHWEST PHILIPPINES ANNUAL

CONFERENCE

AGRA ANNUAL CONFERENCE

BENGAL ANNUAL CONFERENCE

BOMBAY ANNUAL CONFERENCE

DELHI ANNUAL CONFERENCE

GUJARAT ANNUAL CONFERENCE

HYDERABAD ANNUAL CONFERENCE

KLUCKNOW ANNUAL CONFERENCE

MADHYA PRADESH ANNUAL

CONFERENCE

MORADABAD ANNUAL CONFERENCE

NORTH INDIA ANNUAL CONFERENCE

SOUTH INDIA ANNUAL CONFERENCE

A-37

e. Annual Conference-related institutions numbering

approximately 542, and including homes, hospitals,

orphanages, day-care centers, colleges, and seminaries ;

f. The general-level boards and agencies of United

Methodism, as follows: The General Council on Finance

and Administration of The United Methodist Church

(“GCFA”), an [Illinois not-for-profit corporation,

named as a defendant herein and represented by

counsel; The Board of Global Ministries of The United

Methodist Church, a New York not-for-profit corpora-

tion, named as a defendant herein and represented by

counsel; The Health & Welfare Ministries Division of

the Board of Global Ministries of The United Methodist

Church, an Illinois not-for-profit corporation, named

as a defendant herein and represented by counsel; and

the following additional boards together with their

divisions and sub-units:

GENERAL COUNCIL ON MINISTRIES

UNITED METHODIST COMMUNICATIONS

GENERAL BOARD OF CHURCH

AND SOCIETY

GENERAL BOARD OF DISCIPLESHIP

UNITED METHODIST YOUTH MINISTRY

ORGANIZATION

GENERAL BOARD OF HIGHER

EDUCATION AND MINISTRY

GENERAL BOARD OF PENSIONS

GENERAL BOARD OF PUBLICATION

COMMISSION OF ARCHIVES

AND HISTORY

COMMISSION ON RELIGION AND) RACE

COMMISSION ON THE STATUS AND

ROLE OF WOMEN

g. Any other denomination-related institution not

specifically enumerated above.

11. This Court is without jurisdiction over any of the

units within or related to United Methodism referred to

A-38

above, except those units which have been specifically named

as defendants herein.

FOURTH AFFIRMATIVE DEFENSE TO

ALL CAUSES OF ACTION

12. The allegations of Paragraphs 9 and 10 of the Third

Affirmative Defense are referred to and incorporated by

reference herein as though fully set forth.

13. To the extent that this Answer is deemed to be on

behalf of any of the units within or related to United

Methodism which are referred to above, such violates the

due process rights of those units.

FIFTH THROUGH TWENTIETH AFFIRMATIVE

DEFENSES

14. The allegations of Paragraphs 1 through 5 of the

First Affirmative Defense are referred to and incorporated

by reference herein as though fully set forth.

15. On December 20, 1978, defendant herein, GCFA,

filed its First Amended Answer By Defendant GCFA To

The Consolidated Amended Complaint (As Modified By

Plaintiffs’ Motion To Dismiss) asserting 17 affirmative

defenses.

16. The allegations of the Second Affirmative Defense

through the Seventeenth Affirmative Defense, inclusive,

asserted by defendant, GCF ‘A, are referred to and incorpo-

rated by reference as though fully set forth herein as the

Fifth Affirmative Defense through the Twentieth Affirma-

tive Defense, inclusive.

A-39

WHEREFORE, relief is prayed for as follows:

1. That plaintiffs and intervenors take nothing by their

complaint;

2. For such further relief as the Court deems just.

DATED: July 2, 1979

WITWER, MORAN, BURLAGE &

ATKINSON

Samuel W. Witwer

SULLIVAN, JONES & ARCHER

Daniel R. Salas

Attorneys for the Persons Upon

Whom Service of Process Was At-

tempted on Behalf of The United

Methodist Church

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.