Appeals panel upholds Windermere ruling
KANSAS CITY, Mo. (BP)--An appeals court panel has declared that the Missouri Baptist Convention cannot legally prevent the breakaway of Windermere Baptist Conference Center because of the contents of a charter filed by the convention's former executive director in 2000.
Convention officials say they are reviewing the 28-page opinion with legal counsel and discussing the next steps, including an appeal to the Missouri Supreme Court.
In a unanimous opinion authored by Judge James Welsh, the three-judge panel appeared to affirm each holding of Cole County Judge Richard Callahan, who had entered summary judgment against the convention in March 2008.
The appeals panel rejected the convention's contention that its right to elect trustees in the charter was legally enforceable because it made the convention the statutory "sole member" of the Windermere corporation. The court held that, regardless of the right to elect trustees, the convention could not be a sole member because the charter said "this corporation shall have no members." The court said the statutory definition of member did not apply in this instance.
The court held that the voting rights of a non-member could be eliminated by charter amendment -- unless there were a clause in the charter requiring convention approval of amendments. In the absence of such a "convention approval clause," the convention's voting rights could be taken away by amendment without legal remedy.
The convention, in a Nov. 25 hearing before the appeals panel, had argued that the approval clause was intentionally left out by the former executive director, Jim Hill, who filed the charter, under which he became an ex officio member of the breakaway Windermere trustee board.
Hill now heads a rival state convention of a handful of liberal and moderate churches. Windermere has ties with this competing body, the Baptist General Convention of Missouri.
Hill also has family ties to the development company which acquired 941 acres of the original 1,300-acre Lake of the Ozarks conference center three years after the Windermere board defaulted on a loan of more than $20 million in 2003 and then conveyed 941 acres to a lender by a "deed in lieu of foreclosure."
Hill's brother, Jerry, and businessman Bill Jester of Springfield, Mo., created Windermere Development Company, LLC, which now claims ownership of that land.
MBC legal counsel Michael Whitehead said he and other members of the convention's legal team were "surprised and disappointed" by the ruling. He said the ruling provides a number of bases for appeal to the Missouri Supreme Court. Whitehead noted that this is the first time a Missouri appeals court has interpreted certain sections of the nonprofit code, and the issues may be important enough that the Missouri Supreme Court will decide to review it.
"We believe that the court's novel interpretation of the code is wrong," Whitehead said. "The text of the statute permits but does not require a 'convention approval clause.' Even an appeals court cannot just rewrite a statute.
"Furthermore, it is rudimentary that a statutory definition of a term is binding on the court. The court cannot let the Windermere incorporator define the term 'member.' The legislature has done so, and it says a member is a person who has the right to elect trustees more than once."
Windermere was one of five Missouri Baptist Convention subsidiary corporations which broke from the MBC in 2000-01 by changing their charters to create self-perpetuating trustee boards.
Whitehead said the appeals court's insistence on a "convention approval clause" should work in favor of the MBC in three other cases still pending in Cole County. Charters for Missouri Baptist University, Missouri Baptist Foundation and The Baptist Home retirement center do have a "convention approval clause," Whitehead said. "That should mean that MBC should recover those three corporations."
Whitehead said MBC would raise the matter of the "convention approval clauses" in the other three cases with Judge Callahan in Cole County after the Windermere appeal is finalized.
In addition to Windermere, the college, foundation and retirement center, the Word & Way newsjournal also created a self-perpetuating board.
Whitehead, in his arguments before the appeals panel in November, had noted, "After 50 years, MBC loses its $50-million-dollar camp in only three months after transferring it to this subsidiary, and the trial court says we have no legal recourse. And that's why we are here."
After the Feb. 3 appeals ruling, Windermere President Dan Bench, in a statement posted on the conference center's website, stated that the three-judge appeal panel and the trial judge "have now examined the merits of the case and all four have reached the conclusion Windermere and its board acted lawfully as we sought to best fulfill Windermere's important mission. We hope Missouri Baptists will now be able to put this sad conflict behind us. We pray no additional money, energy, or time will be wasted by further litigation efforts."
Prior to seeking legal recourse for return of Windermere to the churches of the Missouri Baptist Convention, the Missouri Baptist Convention sought Christian arbitration, which Windermere officials refused for about one year.
The appeals panel's 28-page opinion, handed down on Feb. 3, is available at the court's website, at http://www.courts.mo.gov/file/Opinion_WD69546.pdf.
Reported by the staff of The Pathway, newsjournal of the Missouri Baptist Convention, with reporting by Baptist Press editor Art Toalston.