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Texas Supreme Court hears landmark case on church control and nonprofit governance

January 16, 2025 | Supreme Court of Texas, Judicial, Texas


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Texas Supreme Court hears landmark case on church control and nonprofit governance
The Supreme Court of Texas convened on January 15, 2025, to hear oral arguments in a significant case involving the ecclesiastical abstention doctrine and its applicability to a dispute between Southern Methodist University (SMU) and the Texas Conference of the United Methodist Church. The discussions centered around jurisdictional issues, the interpretation of nonprofit governance, and the implications of recent amendments to SMU's articles of incorporation.

The session began with counsel for SMU arguing that the ecclesiastical abstention doctrine, which traditionally prevents courts from intervening in religious matters, should not apply in this case. They contended that the court could resolve the issues at hand using neutral principles of law, particularly regarding corporate governance. The attorney emphasized that previous rulings, including the Masterson case, established that courts could adjudicate property disputes without delving into ecclesiastical matters, as long as the resolution relied on neutral legal standards.

In response, the counsel for the Texas Conference asserted that the church must prevail to avoid interference with its ecclesiastical mission. They argued that the court has jurisdiction to address claims of breach of contract and other legal remedies, asserting that the church's historical control over SMU must be recognized. The attorney highlighted the importance of the church's role in the governance of SMU, which they claimed had been undermined by the university's recent amendments to its governing documents.

The justices engaged in extensive questioning, probing the implications of the 1996 articles of incorporation that purportedly established the church's ownership and control over SMU. They explored whether the amendments made in 2019 were valid and if they had effectively stripped the church of its rights. The discussion also touched on the potential consequences of allowing the case to proceed, with concerns raised about the broader impact on Texas corporate law and the precedent it might set for future ecclesiastical disputes.

As the arguments concluded, the justices expressed their intent to carefully consider the jurisdictional questions raised, particularly whether the ecclesiastical abstention doctrine would prevent the court from ruling on the merits of the case. The court is expected to issue a decision that could have significant implications for the relationship between religious organizations and their affiliated institutions in Texas.

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Scribe from Workplace AI
Scribe from Workplace AI