Ownership of real estate by religious organizations raises unique concerns for conveyancing attorneys. When insuring the title to property owned by a
religious organization, it is crucial you determine the various approvals required – not to mention, who should be signing the deed or mortgage. This article will discuss several types of religious organizations and outline who the authorized parties are to convey real property.
In Massachusetts, a religious organization has the capacity to hold legal title to land for purposes consistent with its creation and existence. There are different types of religious organizations with unique requirements for each to convey or encumber property.
Roman
Catholic Church
The Roman Catholic Church has the authority to “receive, hold and manage all real and personal property belonging to such church; and may sell and convey the same.” By statute, the Roman Catholic Archbishop or Bishop of the diocese may associate with themselves two layman, which creates a body corporate and allows them to act as trustees. Pursuant to statute these trustees are then authorized to convey and encumber Church property.
Religious organizations which are
incorporated are one of two types: aggregate and sole. Most non-religious
corporations are of the aggregate type; a separate legal entity with powers
vested in various officers which change from time to time. In contrast, a
corporation sole consists of one person holding a particular title (and their
successors) who is incorporated by law to give certain legal capacities and
rights. The Roman Catholic Church is recognized as a corporation sole, rather
than a corporation aggregate (Akoury v.
Roman Catholic Archbishop of Bos., 18 Mass. L. Rep. 271 (2004). If the
church is structured as a corporation sole, the funds and real property will be
in the custody and control of the archdiocese or diocese. The Archbishop will
have the authority on behalf of the archdiocese to convey property owned by the
church.
United
Methodist Church and African Methodist Episcopal Church
Pursuant to paragraph 2501 in The Book of Discipline of The United Methodist Church, title to all local church property – real and personal, tangible and intangible – is held in trust for The United Methodist Church and subject to the provisions of the Book of Discipline. Every instrument of conveyance of real estate to the church shall contain the appropriate trust clause as set forth in paragraph 2503 in the Book of Discipline after the name of the grantee church, as follows; “In trust, that said premises shall be used, kept, and maintained as a place of divine worship of the United Methodist ministry and members of The United Methodist Church; subject to the Discipline, usage, and ministerial appointments of said Church as from time to time authorized and declared by the General Conference and by the annual conference within whose bounds the said premises are situated. This provision is solely for the benefit of the grantee, and the grantor reserves no right or interest in said premises.”
The trustees of a church, which is a member of the United Methodist Church, cannot lease, convey or mortgage property without the permission of the Annual Conference and the Charge Conference. A vote should be recorded evidencing the permission obtained and the authorized signatories.
Not all Methodist churches follow the Book
of Discipline. For example, the African Methodist Episcopal Zion Church
incorporates some Methodist beliefs, but is not governed by the Book of
Discipline. These churches may organize and become a corporation pursuant to
M.G.L. Ch. 67 §40. The trustees of a Methodist Episcopal Church, including the
African Methodist Church, have the authority to receive, hold, manage, sell and
convey real and personal property. A trustee’s power to convey is consistent
with the powers of a corporation, and may convey the legal title to the
property.
Orthodox Church
An unincorporated orthodox
church may apply to the appropriate hierarch, archbishop or bishop for
permission to incorporate under MGL Ch. 67 §55. Once permission
is granted in writing, it shall be filed along with the Certificate of Incorporation
with the Secretary of State. The Certificate of Incorporation will recite the
intent of the corporation and layout the authorized parties with authority to
convey real estate. Once the church is incorporated, the parties listed with
the Secretary of State have authority on behalf of the religious organization
to convey church property.
Unique Title Issues Involving Churches
An incorporated church can transfer title of church property, as authorized by the church’s governing body, by means of a deed identifying the church by its corporate name and is signed by the authorized parties listed with the Secretary of State’s office.
Title into to an unincorporated church (e.g., The Church of Conveyancers), may be questioned, as it is unclear who can sign on behalf of the association which can create unique issues. If insuring a conveyance out of an unincorporated church, court action may be required to determine the parties with authority to sell.
As an additional quirk, a conveyance of Methodist church-owned property requires a certified copy of the resolution of the Annual Conference of the church which sets forth approval of the sale, sales price, and empowerment of the trustees to execute and deliver the required documents and accept the proceeds from the sale.
A Co-chair of REBA’s
Residential Conveyancing Section, Katherine Prifti is Massachusetts State
Counsel for First American Title Insurance Company. Katherine
routinely collaborates on complex and substantial commercial transactions with First
American agents other external and internal clients. She can be contacted at kprifti@firstam.com.
