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In the… [crucial] section of his order, Judge Houck sets out the law that is applicable to these various claims and assertions (“Standard of Review”). Citing another 4th Circuit case which is binding upon him, Judge Houck writes: “Thus, ‘(i)f a plaintiff can establish, without the resolution of an issue of federal law, all of the essential elements of his state law claim, then the claim does not necessarily depend on a question of federal law.” To determine this question, the U.S. Supreme Court requires a federal court to which a state-law case has been removed to analyze whether or not the federal claim involved is “substantial”, or is merely an incident to the dispute:

Under the substantial federal question doctrine, “federal jurisdiction over a state law claim will lie if a federal issue is: (1) necessarily raised, (2) actually disputed, (3) substantial, and (4) capable of resolution in federal court without disrupting the federal-state balance approved by Congress.” … If the defendant fails to demonstrate all four of these elements, removal is improper under this doctrine.

Now Judge Houck turns to a detailed analysis of the defendants’ arguments to see how they fare under each of the four prongs of this test. He preliminarily disposes of the defendants’ claims concerning the Lanham (federal trademark) Act, and observes that the plaintiffs had the absolute right to base their complaint upon State trademark law only. Thus the fact that there may be federal-law claims assertable in addition to the state-law ones pled in the complaint is irrelevant to the analysis.

And in a few thoroughly researched and well-written pages, Judge Houck now demonstrates how insubstantial are the defendants’ federal-law arguments. He takes each of the four prongs one by one, and shows how the defendants’ arguments fail to satisfy any of them. ((That is why Judge Houck’s order would almost certainly be upheld if defendants were able to appeal from it (see below). Failing four out of four grounds of the test does not even make this a close case….)

Read it all and please note that there is a link provded to the full document from the Judge for those of you interested in such things–KSH.

U.S. District Judge C. Weston Houck has ruled that the legal fight over names and property between two factions of South Carolina Episcopalians is a matter for state court.

Houck, who heard arguments last week and issued an order Monday, ruled that the First Amendment is not a main point of contention and that hearing the case in federal court would disrupt the balance between state and federal courts.

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Jim Lewis, Canon to Diocese Bishop Mark Lawrence, said the Diocese is very pleased with the decision since the “issues involved are essentially those of legal identity and are wholly determined by state law, so the most appropriate place to settle is clearly in state court, where we first took the matter.”

Thomas S. Tisdale, Jr., Chancellor of TECinSC said the group is disappointed with the result, but “we are confident in our legal position going forward.”

A separate federal lawsuit, filed by Bishop Charles G. von Rosenberg, who heads TECinSC, is still before Judge Houck. That suit asks the court to find that only Bishop von Rosenberg, as The Episcopal Church’s recognized bishop, should control the name and marks of the diocese.

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U.S. District Judge C. Weston Houck today remanded the case to the South Carolina Circuit Court. In informing the parties, Judge Houck said,

“If this Court determined that a case may be removed based on federal question jurisdiction whenever a defendant attributed a federal constitutional issue not alleged or advanced in a well-pleaded complaint, federal question jurisdiction could potentially be expanded to all cases containing tacit First Amendment issues.”

Diocesan officials expressed their gratitude for the decision.

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Diocesan officials expressed their gratitude for the decision.

“We are very pleased that Judge Houck remanded the case to state court,” said Jim Lewis, Canon to Bishop Lawrence. “The issues involved are essentially those of legal identity and are wholly determined by state law, so the most appropriate place to settle is clearly in state court, where we first took the matter.”

With the case remanded, it returns to the court of South Carolina Circuit Judge Dianne S. Goodstein.

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St. Francis was packed Sunday, with about 140 people filling every pew and the choir area, with visitors from Bakersfield to Lodi. The crowd fit the theme of the day, from the opening hymn to the sermon: “All Are Welcome.”

“What a joy it is to be here in St. Francis Church,” Talton said during his sermon. “This is the church, St. Francis, a part of the Diocese of San Joaquin and a church cannot be divided. We affirm that, praise God.”

But division did hit the parish in 2007, when the San Joaquin Diocese and 40 of its 47 parishes, including St. Francis, voted to leave the theologically liberal national Episcopal church. It became the first diocese in the nation to do so and renamed itself and its parishes Anglican, remaining with the worldwide Anglican Communion, to which the Episcopal church also belongs.

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The fate of the Potemkin “Diocese of Quincy” foreshadows what will probably happen to all of the other Potemkin villages currently being propped up by the coffers of ECUSA, except for Pittsburgh and possibly Fort Worth (depending on how the Texas Supreme Court rules — any day now, by the way). The remnant Episcopalians in San Joaquin, Quincy and South Carolina are currently each governed by a part-time, provisional bishop, previously retired (“resigned”), who spends only a fraction of his time visiting the parishes and handling administrative matters.

The oldest such group is in the geographical area of the former Diocese of San Joaquin, spread over fourteen California counties in the southern Central Valley. The Presiding Bishop called its initial convention in April 2008 so that it could immediately file a lawsuit against Bishop Schofield (but not naming his Anglican Diocese — remember, ECUSA cannot recognize the right of a diocese to withdraw, without forfeiting its claims to the withdrawing diocese’s property and bank accounts).

After five years, the group’s lawsuit against Bishop Schofield has yet to go to trial, while it has accepted loans and subsidies from ECUSA amounting to about $1.5 million thus far. Meanwhile, its ASA dropped since 2001 by nearly 80%, and has remained flat at just 943 for 2010 and 2011.

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Essentially, what is at issue on the motion to remand is whether or not the Court can fairly read the Lawrence State court complaint to state a “claim or controversy” under the laws of the United States, so that the case could have been brought initially in the federal Court. One would think that a complaint based only upon State trademark law would be left to the State courts to decide, but ECUSA and its Potemkin diocese saw things differently. ECUSA has not done well in the South Carolina State courts, and so they wanted desperately to have the federal courts take jurisdiction of the dispute over who owns the rights to the name “Episcopal Diocese of South Carolina.”

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Attorneys for the diocese asked Houck on Thursday to move the case back into state court.

“Under federal law, there is no basis for federal jurisdiction,” attorney Alan Runyon said. He said property issues and the use of the diocesan name can be resolved under state law and don’t raise any constitutional issues.

He argued that under the South Carolina Nonprofit Corporation Act, a nonprofit’s membership in a large group is voluntary and it can end the association if it wants. “That doesn’t change because they are religious organizations,” he said.

But Matthew McGill, representing the diocese of parishes remaining with the national church, said the case concerns the First Amendment protections of freedom of religion.

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We are grateful to the Very Rev. John Barr who has written the following note and prayer. We commend them both to you.

Today, June 6, attorneys representing the Diocese of South Carolina will go before a federal judge to request our case be moved back to its original venue in the South Carolina state court system. Our sense is that this hearing might well be a critical crossroads. We believe that the original venue of state court””where the Diocese and its parishes have sought a simple declaratory judgment as to whether we have title to our own property and whether we are the Diocese of South Carolina””is the true venue where the question should be settled.
Ultimately, of course, God owns the property. The gospel never changes; his promises are indestructible; and our high calling as Christ’s disciples is bright and undiminished. We see through a glass darkly, and God’s perfect will for us is sovereign, but we are asking you to pray for the return of this litigation to state court. No doubt, God will work his purposes out whatever the legal venue. The apostle Paul reminds us, “I have learned to be content in all circumstances”¦”

Gracious Lord, we pray that your will would be done on June 6. May we want what you desire. Speak your words alone through Alan Runyan and the other attorneys who represent us. May the courtroom be filled with the pleasant aroma of Christ, and at the end of the day, protect this Diocese and its parishes that we might bring the redemptive power of the biblical gospel to the South Carolina low country and beyond. Let not our fear of outcomes tarnish our joy or deter us from the mission you have given us. Teach us to bless and never curse those on the other side of this conflict. Thy will be done on earth as it is in heaven. And make us victorious over-comers wherever this road leads. For we ask it all in Jesus’ Name. Amen.

Attorneys representing separate Episcopal churches in eastern South Carolina are facing off in federal court.

The matter before U.S. District Judge C. Weston Houck on Thursday is whether issues resulting from the split should be heard in state or federal court. One of the issues is title to an estimated half billion dollars in church property.

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Church Pension Group issued a statement Tuesday saying it is trying to ensure that clergy and employees in parishes that have left The Episcopal Church have access to their funds, in accordance with federal laws.

“In doing so, we are following protocols required by the Internal Revenue Code to avoid any adverse consequences for the participants in the plans,” the statement said. “We expect to complete this process shortly. In the meantime, all funds remain invested in the options selected by these employees, and all accounts are fully viewable on (a) website.”

[Canon Jim] Lewis said he has consulted lawyers for the diocese and is unaware of any legal issues precluding employees from rolling over their plans. He believes that preventing employees from doing so could be illegal.

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The retirement savings of more than 80 non-clergy employees of the Diocese of South Carolina and its parishes are being held hostage by their former pension plan at the Episcopal Church (TEC).

The lay employees have been trying to arrange for the rollover of their retirement savings since February, when they first contacted the Church Pension Group, which provides retirement, health and other benefits to employees of The Episcopal Church, its parishes, dioceses and other institutions. The employees became eligible to rollover their funds into another qualified plan when their employer, the Diocese or the parishes that voted to disassociate from the denomination, officially ceased to be employed by any TEC organization or parish.

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It’s a rather neat set-up, don’t you think? Get the uneasy bishops to face disciplinary charges, and then soft-soap them with promises of full (well, almost) confidentiality. And then disregard the terms of the Accord entirely, thereby letting the accused bishops know that nothing, absolutely nothing, will stand in the way of intimidating them to whatever extent may be necessary to keep them silent.

In other words, despite your own contempt for the language of the Accord, continue to hold it over them, to intimidate them from attempting to commit such an outrageous act of disloyalty ever again. And if the bishops allow that continuing intimidation to affect their actions, then I pray for them, and for the future of a Church that is in such cynical and calculating hands.

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The Rev. Kathryn Galicia, who leads the St. Francis Episcopal congregation, did not return phone calls and emails seeking comment. In the past, she said she was unable to talk publicly about the upcoming property settlement.

“We didn’t want to say anything before the property matter was settled,” Talton said. He added that he wishes the departing Anglican congregation well and was trying to be “sensitive” to its feelings in the weeks leading to the return of the property.

Likewise, Anglican Bishop Eric Menees in his remarks to the former St. Francis congregation urged members to pray for the returning Episcopalian congregation and to put any anger it had over the forfeiture of the property on him, because “I was the one who made the decision to give up the property.”

Read more here: http://www.modbee.com/2013/05/31/2741914/st-francis-property-episcopal.html#storylink=cpy

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Jesse Zink is therefore quite right: the Diocese of South Carolina cannot properly remain independent indefinitely. To be faithful not just to Anglican but more importantly to catholic ecclesiology, its bishops should belong to a province.

Once litigation in the secular courts is concluded, this could be achieved in several ways. There could be reconciliation with the Episcopal Church’s national leadership ”” we should always pray for reconciliation leading to the visible unity of the Church, however remote human sinfulness may make that prospect seem. Or the diocese could join the Anglican Church in North America or (less ideally) a more distant Anglican province.

Alternatively, it could follow the Sudan model, to which Zink points, and become a province by dividing into four dioceses. Half of one U.S. state, with fewer than 80 congregations and 30,000 baptized members, might be thought rather small to form a separate province. However, in 1998 the geographically and numerically much smaller Diocese of Hong Kong and Macao was divided into three dioceses (with only 38 congregations between them) and a “missionary area.” This enabled it to become a freestanding province of the Anglican Communion instead of joining the Church of the Province of South East Asia, which was formed in 1996 by the more conservative extra-provincial dioceses with which it had previously been associated.

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Now comes a task I would rather not face, given that I count many non-canon lawyers who are bloggers on Episcopal matters at least as colleagues, if not as personal friends. But in the wake of my commentary on the recent St. James ruling, a host of lay would-be canonists have rushed in to assure everyone that the ruling is not as bad as it is, or that it does not really say what it says. The latest comes from the estimable Father Haller, but he and others have also been contributing to the comments on other blogs. (Note that no one has seen fit to come here and question me directly.)

Let’s clear up one simple matter first: the ruling is not yet precedent for California courts, because it is only the decision of a single trial judge in Orange County, California. As I pointed out in my original post, it will become problematic only if it is affirmed upon appeal. (But as I also pointed out in my post, all of the appeals taken thus far by St. James in this case were decided against them initially by the Court of Appeals.)

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The sign outside St. Francis Anglican Church reads “think FORGIVE act.” Action and forgiveness were the themes of the day, as the parishioners gathered Sunday for one last time at their church on Main Street before walking several blocks away to begin a new church in rented facilities.

The congregation opened its closing service with “Joyful, Joyful, We Adore Thee,” which includes the words, “Thou art giving and forgiving … teach us how to love each other.”

It was especially poignant because the St. Francis facility has been in a tug-of-war since 2007, when 40 of the 47 parishes in the San Joaquin Diocese voted to leave the national Episcopal church over theological differences. The departing parishes, including St. Francis, and the diocese were sued by the Episcopal church in 2008 and 2009 in a bid to regain those properties.

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…there is no reason to presume that South Carolina’s declaration of itself as an extra-provincial diocese is more than an ad hoc solution to an immediate crisis. To speculate about the permanence of this situation or about which Anglican entity South Carolina might align itself with is equally a case of playing “Cheat the Prophet.”

The issue that is little addressed in such discussions is the theological nature of episcopacy. What does it mean to be a bishop? Standard Church histories make clear that the office of bishop is about continuity, specifically continuity between the apostolic Church and the catholic Church of the second century. To be a bishop is to recognize and submit oneself to the canonical authority of the Old and New Testaments as the faithful witness of prophets and apostles to the triune God revealed in the history of Israel, the saving work of Jesus Christ, and the Church as summarized in the Rule of Faith.

Whether bishops of the Episcopal Church have acted in continuity with this apostolic Church in proceeding to approve of same-sex unions is precisely the issue that is splitting the Anglican Communion. There are, of course, issues of universality involved as well. A bishop is a bishop not just for a local diocese but for the whole Church. In the long run, an extra-provincial diocese accountable only to itself is problematic. But then again, a national church that refuses to be accountable to an international communion has brought the Anglican Communion to its current crisis, even as a bishop who does not understand his chief role to keep intact the apostolic witness has rather missed the point of being a bishop.

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As in Scripture, so also in ecclesiology: the pernicious hermeneutic of self-justification remains a constant temptation. This is regrettable. Ecclesiology is not a minor administrative matter that can be casually tossed aside. It is part of the core good news Christians have to proclaim. In a globalizing world that is dominated by discord and fracture, the Church makes the counter-cultural claim that in baptism we come to belong to the body of Christ. No other entity is shaped by a common willingness to die daily with Christ and be raised with him who is the author of true and abundant life. We believe we belong, and that this is good news. Anglicans work out the implications of this radical claim in the constellation of parishes, dioceses, provinces, networks, and institutions that comprise our global Communion.

The dispute in South Carolina could provide an opportunity ”” yet unrealized ”” to think seriously about the ecclesiological and theological convictions underlying Anglican churches. On that note, we might welcome the recent call in these pages for a retreat on the topic, organized by seminary deans. Prayerfully and reverently, one hopes, Anglicans may yet learn together to honor our theological convictions in our ecclesiological structures.

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St. Paul’s Anglican Parish in Bakersfield is looking for a new home following a courtroom decision that hands control of its church property back to the Episcopal Church.

The Anglicans are on the move following a little-noticed ruling in February that parishioners in two of several breakaway Kern churches lacked the authority to disaffiliate from the Episcopal Church.

Even though Anglicans at St. Paul’s and St. Michael’s Anglican Church in Ridgecrest both held their own titles to church property, Kern County Superior Court Judge Sidney P. Chapin ruled that they had to vacate.

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The court order, which comes at what could be the end of a series of court battles over three church properties on 32nd Street, was reaffirmed Monday by Judge Kim G. Dunning.

“I give thanks for the culmination of this marathon litigation, and I pray this action will settle the fact that people can disagree but cannot take property that has been entrusted to the Episcopal Church for ministry,” Right Rev. J. Jon Bruno, bishop of the six-county diocese, said in a statement. “I give thanks to God that, after these cases spanning more than eight years, we now can proceed with the continuing ministry of the Episcopal Church in Newport Beach.”

St. James leaders said they were “obviously disappointed by this ruling.”

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Judge Kim Dunning of the Orange County Supreme Court handed down on May 1 a surprise ruling in the case involving the property of St. James’s parish in Newport Beach, and held that St. James could not retain title to its property after it voted in 2004 to disaffiliate from the Episcopal Church (USA). But due to the bizarre reasoning she used to reach that conclusion, the ruling — if upheld on appeal — would put a cloud on the title of every previous sale or disposition of any Episcopal parish property in the State since 1980.

The wrinkle in the St. James case — a feature which distinguished it from the cases of two other parishes in the Diocese of Los Angeles (St. David’s Hollywood; and All Saints, Long Beach) which Judge Dunning ruled last September could not retain their properties either — was that St. James had been given an explicit letter from the Diocese in 1991 prior to purchasing the property at issue here, and undertaking the multi-million-dollar expense of developing it….

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Small wonder, given the harrowing times recently, that news about a long-running property fight over a picturesque church in northern Virginia escaped most people’s notice. But the story of the struggle over the historic Falls Church is nonetheless worth a closer look. It’s one more telling example of a little-acknowledged truth: though religious traditionalism may be losing today’s political and legal battles, it remains poised to win the wider war over what Christianity will look like tomorrow.

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The Court says that Virginia is a State that follows and applies “neutral principles of law,” but don’t let that fool you. What exactly is so “neutral” about (a) judges creating a trust out of whole cloth that the parties themselves never formalized, so that (b) a church like ECUSA can secure a windfall for the unjust enrichment of one of its dioceses?

Justice Powell’s result rests entirely upon her finding that a “fiduciary relationship” existed between The Falls Church and the national Church. But she spends no time whatsoever in examining the particulars of such a relationship, or deciding just when and how it actually came into being.

Fiduciary relationships are very special in the eyes of the law. A fiduciary is a person or entity in whom one confides (such as a client with his attorney, a patient with his psychiatrist, or a penitent with his priest) — or it can also be a person or entity to whom one entrusts money or property, such as a client with his stockbroker or banker. Or it can simply be the trustee who holds certain property in trust for what the law calls the beneficiary of that trust — the person for whose benefit the trust was established.

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