The old saying goes “you can’t take it with you”, but you can leave it to your children or loved ones. But what happens when a church decides to sell? What’s the process for selling a church property? Who makes that important decision and what factors go into the decision of whether a church should sell its parsonage?
If you are looking for who owns a church property, we can help. The person who owns the property is called the legal titleholder of the property. It is this titleholder, whether a person or an organization, that has legal rights to the property and any assets (such as furniture, fixtures and equipment) contained in it.
First off, what makes a building a church property? Basically, if you own the land and/or the building, then you’d be looking at a church property. No matter how owners of church properties are classified, for certain things they’ll need to obtain appropriate permission or approval from the IRS. Even if their status is determined as one of the following:
Churches, which are usually nonprofits, buy, sell, and swap church properties. When you purchase a property for a new campus for your church or for expansion of an existing campus, the purchase contract should include a title search , which is essentially an investigation to determine whether there are any liens (legal claims against the property) and/or encumbrances (legal restrictions against the property) that would hinder your ownership of the property.
A church property is owned by the Church, but it can be owned by an individual or group of people as well. The head of the church is usually responsible for making all decisions related to the church property and its use. The head of a church can also appoint someone to oversee the management of their church’s property.
The church property, in most cases, belongs to the church. In many states, one or more trustees hold the land and buildings in trust on behalf of the congregation. The congregation may elect or appoint the trustee(s); occasionally, the congregation appoints a committee of members to serve as trustees. In some states, property held in trust does not vest in any one member of the congregation but remains in the undivided interest of all members.
Who Owns A Church Property
When it comes to church property, there is no one-size-fits all answer. The ownership of the land and buildings in a parish depends on whether it is part of the Church of England, Roman Catholic Church, Presbyterianism or Methodism.
All Church of England property is held in trust, and the legal title to it rests with the Crown through the monarch’s role as ‘Supreme Governor’ of the Church of England.
The monarch is the supreme governor of the Church of England and, as such, has ultimate responsibility for Church property. However, any owner or tenant of a church building will be aware that the legal title to it rests with the Crown. This is because all churches are ultimately owned by Her Majesty The Queen in right of her Crown Estate (the ‘Crown’).
The monarch is represented by a minister called the Lord Chancellor, who acts on behalf of Her Majesty when she is not present in person (as she would be if she attended a service). In this role, he or she also acts as head justice in England and Wales; however, he is not a head judge because judges cannot hold political office under UK law. Finally, since Henry VIII’s split from Rome in 1534, when he established himself as Head of Church and State under one body politic, known today as Anglicanism, it has been customary for him or her to also act as Supreme Governor.”
In the Roman Catholic Church, property is owned by a corporation established by Canon Law.
The Roman Catholic Church is organized into dioceses, each headed by a bishop. The bishop is appointed by the pope (the head of the Roman Catholic Church). As such, the pope may issue decrees that affect the entire church or its property. So in this sense, it may be said that a bishop or pope owns his or her diocese’s property because he or she has been granted legal authority over it.
The key word in Presbyterianism is “property.” This is about how a congregation owns its physical property.
The key word in Presbyterianism is “property.” This is about how a congregation owns its physical property.
- Congregations own the building, land, money, and furniture. The property belongs to the congregation, not to the church (or denomination). It does not belong to the pastor or session (local leaders). Even though these individuals may administer your church’s properties on behalf of your congregation during their tenure of service, they do not have legal ownership of them as individuals who are not part of your constituency group (i.e., congregation).
The Methodist Conference has overall responsibility for Methodist property.
The Methodist Conference is responsible for all Methodist property. It is the highest decision-making body in the Methodist Church, and it meets every two years in a General Meeting of the Methodist Church to make decisions about policy and rules.
Each diocese has its own synod, which meets annually and consists of clergy and lay representatives from each congregation within that diocese (or local church). The synod also elects its own leaders—a bishop and an executive committee—who have responsibility for pastoral work (including counselling) in their area; they also decide on matters affecting their local churches.
The central body for Baptists was founded in 1644, as an inter-association for members of churches who were already independently organised.
The central body for Baptists was founded in 1644 as an inter-association for members of churches who were already independently organised.
Many Baptist ministers from all over the nation attended the first General Assembly in London, where they established a number of policies and procedures pertaining to their religion. One of these rules stated that no minister would be allowed to take part in any future assemblies unless he had been baptised himself (hence why today all baptized Christians can attend General Assemblies).
Church property belongs to various bodies, depending on the denomination
Church property belongs to various bodies, depending on the denomination. The Church of England, for example, is the Established Church and therefore owned by the Crown. The Conference owns Methodist churches, while the diocese owns Roman Catholic ones.
What Happens When A Church Sells Property
If you are moving on from your existing church building, you must be prepared for a selling process that is unique from typical real estate sales. To help you prepare, here are seven important questions you need to answer:
Who owns a church property?
One of the most important things to make sure of at the very beginning is who has the right or the authority to make the decision to sell your church.
If you are an autonomous or independent church where congregation members can have the final say on leadership and other administrative matters, then deciding to sell can be more straightforward.
Church Property Law
Representing Churches locally, regionally and nationally throughout the United States in defending against trust claims brought by their national denominations, the Church Property Law practice at Taylor Porter is nationally renowned, recognized and published, with Partner Lloyd Lunceford serving as the General Editor for A Guide to Church Property Law, 2nd edition, Reformation Press, 2010, 478 pages. In the course of this practice, our attorneys have advised and represented more than 100 churches in 25 states, ranging in size from 20 to 8,000 congregation members, and churches whose property value ranged from a few hundred thousand dollars to as high as an estimated $100 million.
Local churches are most often listed as the owner in the deed to the local church property, but the denominations nevertheless sometimes claim a right to determine occupancy, use and control on the basis of a “trust clause” added to the denominational constitution. The question then becomes, “Who really owns the church building?” Recent court decisions in the United States have generated significant publicity and concern, prompting many congregations to seek review of the status of their local church property.
Our attorneys help churches evaluate their property-related documents to determine whether or not they have a viable claim to own their property without any trust attaching to it in favor of the denomination and in obtain civil court judgments that establish full and unfettered ownership.
Additionally, if the local church decides it wants to change denominations, our attorneys help manage their risks as they navigate to that destination, whether by district agency vote of “dismissal” or congregational vote of “disaffiliation.”
Our Church Property Law practice representatives, sample cases and clients include:
Obtained injunctions that prevented immediate hostile takeovers by district denominational representatives on behalf of churches in Delaware, Mississippi, Louisiana, Texas, Missouri, Indiana and elsewhere.
Represented Carrollton Presbyterian Church of New Orleans against the Presbytery of South Louisiana in successfully establishing the local church’s right to sell its property without Presbytery permission being required. The local church was awarded $480,000 in sanctions levied against the Presbytery for its bad-faith litigation.
I served as co-counselor for Highland Park Presbyterian Church in successfully obtaining an injunction that barred Grace Presbytery from interfering with the local church’s property use and decision to change denominations.
Served as co-counselor for First Presbyterian Church of Houston in successfully obtaining summary judgment on behalf of the local church, declaring that it owned its property free of any trust in favor of the denomination.
Submitted amicus curiae briefs to the state supreme courts of South Carolina, Texas, Indiana, and Oregon in both Episcopalian and Presbyterian cases. These briefs successfully urged the courts to adopt neutral legal principles as the only way to settle church property disputes.
However, if your church belongs to a particular denomination, ownership of the building and property may be listed under the concerned denominational body.
In this case, a more thorough internal process will be required to sell the church property. This should involve consultation with and approval from the church’s congregation members. The consultation process may result in formal bylaws or any other documented procedure to facilitate the sale.
What is “relegation to profane use”?
A key term to understand when selling a church property is “relegation to profane use.” This happens when a church and the property on which it is built is sold for use other than sacred worship.
Church law requires that the property be used for dignified and appropriate purposes. In other words, the building and the surrounding property will be available for secular use but may not be used for any immoral or offensive activities.
If the property is sold to a new owner but will still be used for sacred worship, no relegation will be required.
What happens to the sacred objects housed within the church property?
All sacred objects must be removed from the property, according to Church law. These include everything from the altar to stained glass windows and other religious statues and artifacts.
Each item must be catalogued and made available to other churches that can find use for them in their respective locations or buildings. The distribution of these sacred items is done to ensure that the legacy of the former church is preserved and given due recognition.
Where must the money earned from the sales go?
If the church property belongs to a denominational body, any funds earned from the sale can be used only for either of the following:
- to purchase a new building and property for the church
- to support a local community mission
- to benefit local nonprofit organizations
What paperwork will be involved in the sale of a church property?
Like any real estate sale, church sales today require their fair share of paperwork as a means of protection from risk and liability. Documents you should expect to accomplish and submit include:
- Your listing agreement with your real estate agent
- Real estate condition report or disclosure statement
- Offer to purchase or lease
- Final closing statement, which the title company will prepare
Conclusion
The Church of England, for example, has a very specific hierarchy and legal structure. By contrast, the Free Churches are generally independent and self-governing. The general rule is that church property is owned by a body set up to hold it in trust for people who use the buildings. In this sense, churches have much in common with schools or other community centres: they’re places where people gather together to do things together.