Clergy Authority in Property Matters
By Richard R. Hammar, J.D., LL.M., CPA
© Copyright 1991, 1998 by Church Law & Tax Report. All rights reserved. This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is provided with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. Church Law & Tax Report, PO Box 1098, Matthews, NC 28106. Reference Code: m28
A minister can engage in property transactions on behalf of a church only if authorized to do so. Authority may be expressly granted in the church's charter or bylaws, but more frequently a church's board of directors or congregational membership votes to authorize the minister to represent the church in a specific transaction.1
Where no authority over the business and property affairs of a church has been delegated to a minister, he or she may not lawfully act for the church in such matters. In one case, a minister declared himself to be the absolute religious leader of a congregation and thereafter exercised complete control over all of the church's spiritual and business activities. The minister's conveyance of church properties was challenged by members of the congregation who questioned his authority in business matters. The court concluded that the minister's “proclaiming . . . of himself as the religious superior of the congregation may suffice to establish that fact in spiritual matters of his church, but it does not effect legal superiority in secular matters.”2 The court emphasized that there must be “clear and convincing” evidence of congregational acceptance of legal superiority by a minister over church business and property matters before such authority will be recognized by the courts. In a related case, a minister who was the sole trustee of a church was not permitted to convey church property for his own benefit.3 And, when a minister attempted to lease church properties without authorization from the church board, the lease was found to have no legal effect.4
A church may of course ratify the unauthorized actions of its pastor. Ratification may be by express action of the congregation or church board, or it may be implied if the church has knowledge of unauthorized action but does nothing to repeal it.5 To illustrate, if a minister commits some unauthorized act and the church knows of the act but does not object within a reasonable time, the church may be left without legal recourse.
For related information on this topic see the following articles:
General Scope of a Minister's Authority
Officer of the Church Corporation
Performance of Marriage Ceremonies
Visiting Privileges at Penal Institutions