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Michael Holly
Michael Holly, Solicitor
Category: Property Law
Satisfied Customers: 6535
Experience:  BA honours degree in law, over 20 years experience in litigation, contract and property matters
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we are a churhc which is affiliated to a national organisation.

Customer Question

we are a churhc which is affiliated to a national organisation. The trustees have made considerable financial loss by purhasing a property with the intent of turning it into a conference centre. We are funancially autonomous as a local church. Can the national organisation unilaterally
sell our church building to offset financial losses which they have imprudently and irresponsibly incurred?
Submitted: 3 years ago.
Category: Property Law
Expert:  Michael Holly replied 3 years ago.

Who owns the Church?

Yours sincerely

Customer: replied 3 years ago.

the church was purhased originally by the members of the church in 1996. There was a trust deed on the church in 1963 held by the Church of God of Prophecy trust which was amended in 1983. So even though the chursh was purchased by the the members it is deemed as a trust property under the church of god of propheci in the U.K

Expert:  Michael Holly replied 3 years ago.

Dear Alex

The position is that trustees have a duty to manage trust assets competently and if they fail to do so can be personally liable.

Beyond that it gets complex. The reason is that the courts rarely sanction trustees for incompetence where there is no personal gain mde by the trustee. A decision , such as the decision to create a conference centre , may have seemed perfectly sensible at the time it was made.Economic circumstances change.Also making a contentious decision is not enough since the trustees do not require universal approval, they must simply have good reason for making the decision at the time.Courts tend not to interfere because they feel that many people undertake such roles voluntarily and do their best.If they were asked to do so knowing there was a real risk a decision could lead to personal liability there would not be many takers.

The situation is analogous to employment law. An employee cannot claim compensation for loss of employment on the basis that the employer's bad business decisions caused the loss of his job.

As such looking at this as a potential litigation case unless the mis management involved personal gain for the trustees you have little chance of success here.

I appreciate that this is not what you wanted to read but only an honest answer is of value to you.There may be other things that you can do such as petioning members or getting an article in the local newspapers that will have effect without taking legal action.

If there are any further points please reply

Best wishes

Yours sincerely

Michael Holly, Solicitor
Category: Property Law
Satisfied Customers: 6535
Experience: BA honours degree in law, over 20 years experience in litigation, contract and property matters
Michael Holly and other Property Law Specialists are ready to help you
Customer: replied 3 years ago.

You have not really reponded to the specific question of the intention of the trustees to dispose of our church building to defray some of the financial losses they have made.


Our church is spiritually vibrant serves the needs of the members and the local community. Also it is financially independent and does not depend on the national administration for any financial subsidies. The critical question is: Can the trustees unilaterally decide to dispose off our church building to raise money to cover their financial losses?

Expert:  Michael Holly replied 3 years ago.

Yes , assuming the building falls under their control they can. I would want to look very closely at the terms upon which it was passed to them to be sure. Many charitable bequests are made with stipulations such as that land must continue to be used in a particular way and the documents should be looked at carefully.

Yours sincerely

Michael

Customer: replied 3 years ago.

The church building is not a bequest. it is one of many church buildings which is being administerted by the Board of trustees. Are tye not breaching their legal duties to try and sell our building?

Expert:  Michael Holly replied 3 years ago.

No, just because your Church is thriving it does not mean that the decision to sell the building is perverse enough for a court to intervene, it may be that the decision is a sensible one because it is the most viable to sell and benefits the trust as a whole.

As a matter of practicality my inclination would be to get a specialist barrister's advice on this if you can provide all the relevant documents.It is no longer necessary to go through a solicitor to instruct a barrister and they would have the benefit of being able to look at all the papers.It would be expensive but the hope is that there may be something in the paperwork that would prevent sale. The trustees are very unlikely to ignore an Advice from a specialist barrister since to do so would risk personal liability

Yours sincerely

Michael

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