Decision Number 64

Episcopal Decision By Bishop Clare Purcell Concerning Legality of Action of Upper South Carolina Annual Conference Relating to Transfer of Lander College to the Lander Foundation

Digest

An Annual Conference can dispose of by gift to a non-denominational body, a College owned and controlled by it even tho same has been built by private donations; PROVIDED that if there should be assets belonging to the College made in consideration of remaining a Methodist college under the control and manage of the Annual Conference, the disposition of such particular as would be a matter of property rights and controlled by civil law, over which property rights the Judicial Council would probably no jurisdiction.

Statement of Facts

Taken from the Journal of the Upper South Carolina Confer Near the end of the special session of the Upper South Car Annual Conference at Columbia College, Columbia, S. C., Monday, June 21, 1948, the following request for a ruling was made by the gentlemen whose names are signed thereto:

"To the Presiding Bishop Upper South Carolina Annual Conference Columbia College, Columbia, S. C.

"We respectfully request from the presiding Bishop of the Called Session of the Annual Conference meeting at Columbia College June 21, 1948, a ruling on the legality of the action of the Upper South Carolina Annual Conference meeting at Main Street Methodist Church, Columbia, S. C., Nov. 18, 1947, in regard to the action taken relative to the transfer of Lander College and its assets to the community of Greenwood, S. C.

(Signed) B. L. Kilgo E. R. Mason Ministerial members of the Upper South Carolina Annual Conference."

The action taken by the Upper South Carolina Annual Conference on November 18, 1947, was as follows:

I. The Educational Policy of South Carolina Methodism shall be as follows:

1. Wofford shall be maintained as a standard "A" Grade college, for men primarily, but it may become co-educational, if there is a demand for this, and when the Board of Trustees shall have provided for such a change.

2. Columbia College shall be maintained as a standard "A" Grade college for women.

3. That Lander College, its campus, and all its assets be offered as a gift to the Greenwood community. In the event the Greenwood city or county government or some other responsible agency representing the community agrees to accept the college, the following conditions and reservations be set forth in behalf of the Annual Conference or Conferences in South Carolina:a. The property and assets of Lander College may be used by the agency representing the Greenwood community only as long as they are used exclusively for educational purposes. Under no circumstances may the property or assets of Lander College be disposed of without the consent of the Annual Conference or Conferences of The Methodist Church, Southeastern Jurisdiction, in South Carolina.

b. The name "Lander" may be used as long as the institution is operated as a standard four-year college. In the event the controlling agency should proceed to operate the college on a lower academic level (a junior college, for instance), the name "Lander" must be immediately surrendered.

c. The title to the property and the ownership of all assets of Lander College shall remain with the Annual Conference or Conferences of The Methodist Church, Southeastern Jurisdiction, in South Carolina until such time as the college shall become fully accredited by the Southern Association of Colleges and Secondary Schools. If and when Lander is so accredited, the Church agrees to surrender all claims upon the property and endowed assets of the college within one year of the date of accreditation. In the event of Lander's failure to attain full accreditation with the Southern Association of Colleges and Secondary Schools within ten years of the date of the acceptance of this proposal by the Greenwood community, this contract shall become null and void and the Church shall be free to dispose of the college and its assets (excepting those legally controlled by other agencies) in any way that may seem proper and fitting.

4. That in the event of the rejection on the part of the Greenwood community of the offer set forth in section 3 by June 15, 1948, the Lander property shall be sold to the best possible advantage and that all assets of this institution be equally divided between the two remaining Methodist Colleges in South Carolina.

II. All the institutions named above shall remain for the time being at least, in their respective places of present location.

III. All of these two institutions shall be under the control and management of one President, or Chancellor, and of one Board of Trustees, consisting of 13 members. Each institution shall be under the local management and direction of a Dean, Headmaster, Principal, or President, working in accord with, and under the direction of the above-mentioned President, or Chancellor, and Board of Trustees.

IV. That South Carolina Methodism shall immediately enter upon a campaign to raise not less than $1,000,000.00 for the better development of the two above-named institutions. The proceeds from this campaign shall be divided between the two institutions in the following ratio: Wofford $600,000.00 and Columbia College $400,000.00.

The presiding Bishop and the Cabinets of the two Conferences are requested to select and appoint a Commission of seven to organize, launch and direct the said campaign.

The above action was taken in adjourned sessions of both the South Carolina and the Upper South Carolina Conferences on November 18, 1947. Pursuant to this action the Campaign Commission of Seven was appointed.

On request of the two Conferences, the presiding Bishop also appointed a Committee of Five to act as a liaison with representatives of the Greenwood community consisting of the following: H. O. Chambers, George K. Way, J. H. Kohler, W. D. Gleaton, and F. T. Cunningham. These gentlemen accordingly met with representatives of the Greenwood community and signed an agreement with them embodying the above conditions of the transfer. At subsequent called sessions of the two Annual Conferences held at Columbia College on June 21, 1948, the agreement was approved and a Resolution was passed in each of the Conferences requesting the Southeastern Jurisdictional Conference to give its consent to the transfer proposed in the Resolution adopted November 18, 1947. This was done to meet the requirements of Paragraph 541 of the 1944 Discipline.

Rev. B. L. Kilgo and Rev. E. R. Mason who requested the ruling on the legality of the action of the Conference in its adjourned session last November 18, 1947, stated that their request was based upon their interpretation of Paragraph 541 of the 1944 Discipline, which is as follows:

"541. No invested funds, fiduciary trusts, or property acquired by bequest, donation, or otherwise, for specific objects within the boundaries of an Annual Conference or Conferences may be diverted to other purposes except by the consent of the Annual Conference or Conferences involved and with the consent of the Jurisdictional Conference or Conferences concerned, and civil courts approval when necessary: . . .
Provided, moreover, that trust funds may not be divided or diverted to other purposes than for the specific objects for which donated, even with the consent of the Annual Conferences or Jurisdictional Conferences, unless the said Conferences are the beneficiaries of said trust fund or control them."

Ruling of the Bishop

The Bishop presiding when the request for this ruling made has serious doubt that he should entertain the request. It should be noted that the request was not made in the session of the Conference which took the action in question. That session of the Conference was an adjourned session was duly adjourned sine die on November 18, 1947. The session of the Conference in which the request for a ruling made was a special session held on June 21, 1948, more than seven months later. (See Paragraph 40.) In the meantime the Committee of Five had already entered into agreements with the Greenwood agency for the operation of Lander College. The agency is "The Lander Foundation" and they have employed a President and faculty and have made numerous other commitments. It would, therefore, appear that the request for a ruling at this late day should be dismissed. Furthermore this request is tantamount to a motion for reconsideration which certainly would have been ruled out of order.

Assuming, however, that the request is in order, the Bishop's decision is that the action taken by the Upper South Carolina Annual Conference in adjourned session at Columbia, S. C., November 18, 1947, was entirely legal and well within the provisions of Paragraph 541 of the 1944 Discipline.

The only part of Paragraph 541 on which the question of legality could be raised is the final provision that trust funds may not be divided or diverted to other purposes than for the specific objects for which donated, even with the consent of Annual Conferences or Jurisdictional Conferences, UNLESS the said Conferences are the beneficiaries of said trust funds or control them.

The charge of illegality is based upon a misinterpretation of the above provision. The plaintiffs assume that the proviso means that trust funds cannot be diverted from their original purpose unless the Conference REMAIN the beneficiaries or CONTINUE to control said trust funds. If this were the meaning of the proviso, a Conference could not give away trust funds if it did not keep them-a reductio ad absurdum. Being a beneficiary or being in control of these funds is a precedent and not a subsequent condition of Conference prerogative. The proviso means exactly what it says-that the Conference cannot divert something of which it is not the beneficiary or controlling agent at the time of the diversion and not after.

Even though it might be shown that there exist certain funds or trusts which were donated for specific objects, this could not nullify the over-all action of the Conference in beginning the process by which Lander College can be transferred to the "Lander Foundation" in the future-possibly ten years-when certain other conditions have been met. It could only prevent the transfer of such funds which were donated for specific objects, and it could not prevent the transfer of the property and other assets not included in funds donated for specific objects. Moreover, there is no evidence that any funds exist as having been donated for specific objects among the assets of Lander College.

The claim has been made that the action of the Conference November 18, 1947, was illegal because the Jurisdictional Conference had not given its consent prior to action by the Annual Conference. This position is untenable because the agreements made between the Committee of Five and approved by the Annual Conferences are contingent upon two things: (1) approval by the Jurisdictional Conference which approval has been requested by the Annual Conferences in South Carolina, and (2) the fulfillment of certain specific obligations by the "Lander Foundation"-such as maintaining an institution and for educational purpose only; it must be a standard "A" Grade four-year college an not a junior college; it must be fully accredited within ten years. "The title to the property and the ownership of all as sets of Lander College will remain with the Annual Conference or Conferences of The Methodist Church, Southeaster Jurisdiction, in South Carolina until such time as the college shall become fully accredited . . . . It is clear that the action of the Conference on November 18, 1947, was only the initial step by which the College could within the next ten years be transferred to the "Lander Foundation." To deny an Annual Conference the right to make this beginning would be to disregard a fundamental right. Such denial would nullify the purpose of Paragraph 541 which is to provide a method by which an Annual Conference may legal divest itself of trust funds even though they were donate for specific objects. The next step in this process will be the action of the Jurisdictional Conference as requested by the Annual Conferences. To say that the Conferences could not proceed in the making of a contract until the Jurisdictional Conference approved is another reductio ad absurdum. No Jurisdictional Conference could or would approve a contract not previously approved by the contracting parties. The language of Paragraph 541 presupposes subsequent and not antecedent approval by the Jurisdictional Conference.

In the light of the above considerations it is the decision of the undersigned that the action of the Upper South Carolina Annual Conference relative to the transfer of Lander College and its assets to representatives of the Greenwood Community.-viz., "The Lander Foundation-" was and is legal.

(Signed) CLARE PURCELL, Presiding Bishop Upper South Carolina Annual Conference June 26, 1948.

Decision

The above quoted request for a decision by the Bishop and the decision thereon having been made in open session of the Upper South Carolina Annual Conference and duly recorded in the Journal of said Conference, such decision by Bishop Clare Purcell is now legally before the Judicial Council for review under the Constitution of The Methodist Church (Article II, Subsection 3, Division Four of the Plan of Union. Paragraph 43, Subsection 3 of the 1948 Discipline).

The principal objection urged against the decision of the Bishop is based on the last paragraph of Paragraph 541 of the 1948 Discipline which reads as follows:
"Provided, moreover, that trust funds may not be divided or diverted to other purposes than for the specific objects for which donated, even with the consent of the Annual Conferences or Jurisdictional Conferences, unless the said Conferences are the beneficiaries of said trust funds or control them."

The written record is silent on the question of whether or not there are trust funds on hand now in connection with Lander College donated to Lander College or to the Annual Conference on the specific condition that it remain a Methodist College under the control of the South Carolina Annual Conferences. The Bishop in his opinion makes the following statement:

"Moreover, there is no evidence that any funds exist as having been donated for specific objects among the assets of Lander College."

If the Bishop's assumption in this respect is correct, then the clause out of Paragraph 541 quoted above is not applicable in this case. Furthermore, all other provisions of Paragraph 541 having been complied with, we approve the statement in the Bishop's ruling reading as follows:

"Even though it might be shown that there exist certain funds or trusts which were donated for specific objects, this could not nullify the over-all action of the Conference in beginning the process by which Lander College can be transferred to the 'Lander Foundation' in the future-possibly ten years-when certain other conditions have been met. It could only prevent the transfer of such funds which were donated for specific objects, and it could not prevent the transfer of the property and other assets not included in funds donated for specific objects."

In affirming the ruling of the Bishop, the Judicial Council is not bound by his reasoning. With some of his reasoning the Judicial Council is in disagreement. But assuming that there are no trust funds now on hand in connection with Lander College, donated on condition that said College remain the property of and under the control of the South Carolina Annual Conference, the decision of Bishop Purcell that "the action of the Upper South Carolina Conference relative to the transfer of Lander College and its assets to representatives of the Greenwood Community-viz., 'The Lander Foundation'-was and is legal" is hereby affirmed.

But if there be among the assets of Lander College donations made on conditions as above indicated then the disposition of those particular donations is a matter of property rights controlled strictly by civil law, over which matter the Judicial Council would probably have no jurisdiction.

Dissenting Opinion

I am unable, for the first time, to agree with my brethren I must dissent.

Lander College has been in existence since 1903, as Lander College, succeeding Williamston Female College. On November 18, 1947, the South Carolina Conferences adopted plan of education, expressed to be an educational policy. part of that policy provided that Lander College, a corporation, its campus and all its assets be offered as a gift to the Greenwood City or County government, or some other responsible agency representing the community on certain conditions set out at length. It provided that the name "Lander" might be used as long as a standard four-year college was maintained. Otherwise the name "Lander" mus be surrendered. It provided that the title to the property an ownership of all assets of Lander College "shall remain with the Annual Conferences of The Methodist Church Southeastern Jurisdiction, in South Carolina, until the college should become fully accredited by the Souther Association of Colleges and Secondary Schools, at which time the Church agrees to surrender all claims upon the property and endowed assets." If it failed to be so accredits within ten years "the Church should be free to dispose o the college and its assets (excepting those legally controlled by other agencies) in any way." If such Greenwood organizations, or one of them, did not accept the gift on those terms, then provision was made to sell the property and divide the proceeds equally between the remaining two Methodist Colleges in South Carolina.

Answering a question in writing, Bishop Clare Purcell ruled that under Paragraph 541 of the 1944 Discipline the action proposed was entirely legal. The only portion of that Paragraph that might be considered applicable is "Provided, moreover, that trust funds may not be divided or diverted to other purposes than for the specific objects for which donated, even with the consent of Annual Conferences, or Jurisdictional Conferences, unless the said Conferences are the beneficiaries of said trust funds, or control them."

On argument we were assured that no funds were held in trust but that Lander College owned all the property involved. However, the terms used in the proposal to give the property away such as "endowed assets" and "excepting those legally controlled by other agencies" rather leaves me in doubt.

Criticism might easily be made of these provisions, but I prefer to put my dissent solely on the ground that the Bishop who ruled as stated, had no jurisdiction to pass upon it, and that we have no jurisdiction in the premises.

The question is one of title to property. The title does not depend upon our construction of any Constitutional or Disciplinary Paragraph or Church law, but upon the laws of South Carolina. The title to property can only be settled by a civil court. In many states it would be decided in a CY Pres action but South Carolina does not recognize that proceeding. It no doubt has courts administering equity that could reach and determine the issues. In any event, in my opinion, we have no such power.

In the majority opinion, it is said that if it should develop that there are trust funds held specially, they would not be affected but would remain subject to court action. In other words, the property upon which the proceeds of the trust would be used would be given away and the trust property hang in the air. You cannot harvest wheat with a combine that has been given away and removed.

I believe we should hold this matter to be for the civil courts, and not for this court.

When Paul was brought before Gallio, Deputy or Governor of Achaia, and a question of his violation of the laws of the Jews arose, the record (Acts 18, Verses 14 and 15) reads:
"14. And when Paul was about to open his mouth, Gallio said unto the Jews, If it were a matter of wrong or wicked lewdness, 0 ye Jews., reason would that I should bear with you;

"15. But if it be a question of words and names, and of your law, look ye to it, for I will be no judge on such matters."

I respectfully dissent.