Opinion
G037201
5-23-2007
NEW HOPE COMMUNITY CHURCH OF GOD OF SANTA ANA, Plaintiff and Appellant, v. ASSOCIATION OF THE CHURCH OF GOD OF SOUTHERN CALIFORNIA et al., Defendants and Respondents.
Law Office of Timothy P. Peabody and Timothy P. Peabody for Plaintiff and Appellant. Daley & Heft, Robert W. Brockman, Jr., Lee H. Roistacher; Law Offices of Thomas K. Hadley and Thomas K. Hadley for Defendants and Respondents.
NOT TO BE PUBLISHED
This appeal arises from a dispute pertaining to the ownership of certain real property in Santa Ana. Pursuant to a termination clause in a corporation grant deed, respondents sought summary judgment in their favor on their action to quiet title and on appellants related action to quiet title and for reformation of the deed. The respondents met their burden on summary judgment to establish they were entitled to judgment as a matter of law, and appellant failed to produce evidence demonstrating the existence of triable issues of fact. Thus, the trial court properly granted summary judgment in respondents favor, and we affirm the judgment.
I
FACTS
Plaintiff and appellant is New Hope Community Church of God of Santa Ana (New Hope). Prior to this controversy, New Hope owned real property on South Newhope Street in Santa Ana. Defendant and respondent is the Association of the Church of God of Southern California (the CoG), which administers Southern California for Church of God Ministries.
In 1991, New Hope executed a corporation grant deed that included the following provision: "To have and to hold, so long as Newhope Community Church of God of Santa Ana, California, maintains fellowship and doctrinal unity with the Association of the Church of God of Southern California and the property remains in use by said Church. If this property falls into disuse or, if in the opinion of said Association of the Church of God, Newhope Community Church of God of Santa Ana, California, is no longer in fellowship and doctrinal unity with the Church of God Reformation
New Hope was known as the First Church of God of Santa Ana, California, until approximately 1987. Its property title documents were apparently never amended to reflect the name change, thus, the deed was from the First Church of God to New Hope.
Movement, this property shall go to, vest in and become the property, in fee simple, of the Association of the Church of God of Southern California."
New Hopes pastor, Paul Estebo, became the focus of internal controversy, the details of which are not pertinent here. In 2004, the CoG revoked Estebos ordination. The CoGs administrative board adopted a resolution stating that: 1) Estebos credentials had been revoked; 2) New Hopes Board of Trustees had voted to retain him as pastor, despite his removal from the approved list of ministers; 3) therefore, New Hope was no longer in fellowship and doctrinal unity with the CoG.
On January 14, 2005, the CoG filed a complaint to quiet title in the real property. The complaint sought a declaration that title was vested in the CoG only, based on the conditional language in the deed and the CoGs power of termination. On January 21, 2005, New Hope filed its own separate complaint against the CoG for quiet title, reformation, and lis pendens. New Hopes verified complaint acknowledged the deed, and stated it "served the purposes of NEW HOPE at the time it was recorded inasmuch as NEW HOPE anticipated that such an association would benefit its members and the corporation." New Hope also alleged that "the stated purpose for which the property was contributed is no longer in accord with the policies or best interests" of New Hope, and that its board of directors have "ratified the use of the property for the general purposes of the corporation as an independent Church rather than for the specific purpose for which it was contributed via the DEED of 1991."
Individual plaintiff Estebo also sued a number of individuals for interference with contract and slander/libel, claims which are not part of this appeal.
The two actions were consolidated. In March 2006, the CoG filed a summary judgment/adjudication motion on its complaint for quiet title and against New Hopes complaint for quiet title and reformation. In opposition, New Hope argued that triable issues of fact existed as to whether the CoG and New Hope intended for New Hope to forfeit its property if New Hope was found to be out of fellowship and doctrinal unity. New Hope further argued that the court should reform the grant deed due to mutual mistake. CoG objected to New Hopes evidence, and in its reply, focused on the undisputed language of the grant deed. CoG further argued that New Hope had submitted no evidence to contradict the CoGs position that the parties intent was reflected by the deed.
At oral argument, New Hope argued, for the first time, that the 1991 conveyance was invalid. As this argument was never raised below, or in New Hopes brief, it is improper and we decline to consider it. (American Continental Ins. Co. v. C & Z Timber Co. (1987) 195 Cal.App.3d 1271, 1281.)
The trial court sustained the CoGs objections to the three declarations submitted by New Hope. It then granted the CoGs summary judgment motion, finding that the CoG met its burden to establish that the parties had intended to create a power of termination and that New Hope had not established a triable issue of fact. New Hope appeals.
II
DISCUSSION
New Hopes arguments are somewhat difficult to parse and not easily categorized. Its brief confuses factual and legal issues and states the wrong standard of review (to its own detriment). Further, New Hope did not file a reply brief. While not required, this might have assisted us in understanding its arguments. Nonetheless, we shall do our best to address each of New Hopes arguments.
Standard of Review
Summary judgment is appropriate "if all the papers submitted show that there is no triable issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." (Code Civ. Proc., § 437c, subd. (c).) To prevail on the motion, a defendant must demonstrate the plaintiffs cause of action has no merit. This requirement can be satisfied by showing either one or more elements of the cause of action cannot be established or that a complete defense exists. (Code Civ. Proc., § 437c, subds. (o), (p); Bardin v. Lockheed Aeronautical Systems Co. (1999) 70 Cal.App.4th 494, 499-500.) If the defendant meets this requirement, the burden shifts to the plaintiff to demonstrate a triable issue of material fact exists. (Code Civ. Proc., § 437c, subd. (p)(2); Green v. Ralee Engineering Co. (1998) 19 Cal.4th 66, 72.)
New Hopes Evidence in the Trial Court
In opposition to the CoGs motion for summary judgment, New Hope submitted three declarations. One was from Estebo. The second was from New Hopes president and chairman of its board of trustees, John R. Smith, and the last from board of trustees member Sally Shiner. The CoG objected to each declaration, among other things, on the grounds they failed to state the witnesss competency to testify as to the matters therein and that it was signed under penalty of perjury. (§ 437c, subd. (d); § 2015.15.) In addition to these issues, the Smith declaration was unsigned.
The trial court sustained these objections. As a result, no admissible evidence was before the court in opposition to the CoGs motion for summary judgment. Further, New Hope does not assert on appeal that the courts evidentiary rulings were error. Thus, in reviewing the courts decision to grant summary judgment, we consider only the evidence submitted by the CoG.
New Hope also submitted its verified complaint as evidence. The CoG objected, but the court did not, apparently, issue a ruling on this point. A partys own complaint, verified or not, cannot be used as evidence to defeat summary judgment. (College Hospital v. Superior Court (1994) 8 Cal.4th 704, 720, fn. 7.) We presume the trial court followed the law and did not consider New Hopes complaint as evidence in support of its own position. Statements in a complaint can, of course, be used by the other party as judicial admissions. (Castillo v. Barrera (2007) 146 Cal.App.4th 1317, 1324.)
Quiet Title
The CoG argues that the court correctly determined it was the legal owner of the property pursuant to the power of termination in the deed. We agree. The deeds language provided that the property was to go to the CoG upon the happening of a certain event subsequent to the deeds recordation. Specifically, "if in the opinion of said Association of the Church of God, [New Hope] is no longer in fellowship and doctrinal unity with the Church of God Reformation Movement, this property shall go to, vest in and become the property, in fee simple, of the Association of the Church of God of Southern California."
We agree with the CoG that this created a power of termination. A power of termination is an interest in the property to which it relates. (Civ. Code, § 885.010, subd. (b).) New Hope does not dispute the language of the deed. It does, however, assert that the language regarding "fellowship and doctrinal unity" is "entirely too whimsical to pass muster under any contractual analysis." New Hope offers no legal analysis in support of this argument. While it would be both improper and impossible for the court to determine whether New Hope and the CoG remained in "fellowship and doctrinal unity," the deed here did not require such a determination. Under the deeds plain language, this issue was clearly left in the hands of the CoG: "if in the opinion of said Association of the Church of God, [New Hope] is no longer in fellowship and doctrinal unity . . . ." (Italics added.)
Just as a contract that permits a buyer to unilaterally determine whether goods are of a sufficient quality is proper, so is the language of the deed. Its language places the issue squarely in the hands of the CoG, and as it offered evidence that it reached a determination on this matter, that opinion is sufficient to invoke the termination clause.
We therefore find that CoG established by sufficient evidence that under the deed, it was the legal owner of the property. New Hope failed to offer any admissible evidence to create a triable issue of fact. Therefore, the trial court properly granted summary judgment to the CoG on its cause of action for quiet title and against New Hope on its parallel claim.
Reformation
Reformation is an equitable remedy that permits a court to reform a contract or deed. "When, through fraud or a mutual mistake of the parties, or a mistake of one party, which the other at the time knew or suspected, a written contract does not truly express the intention of the parties, it may be revised on the application of a party aggrieved, so as to express that intention, so far as it can be done without prejudice to rights acquired by third persons, in good faith and for value." (Civ. Code, § 3399.) Reformation is proper when the parties come to a true agreement, but by reason of fraud or mistake, that intent is not expressed in the written instrument. (Shupe v. Nelson (1967) 254 Cal.App.2d 693, 699.) The burden is on the party seeking reformation to demonstrate that the true intent of the agreement was something other than what is reflected by the instrument. (Id. at p. 700.)
In a one-sentence argument, New Hope argues that Corporations Code section 9143, subdivision (b) also permits modification of the deed "since it was no longer in accord with the policies or best interests of Petitioner NEW HOPE." The language of this section does not, by its language, provide for the reformation of a deed. It states that property donated to a nonprofit religious corporation for a specific purpose may be used for general purposes if certain conditions apply. New Hope offers no authority to support the assertion that this section permits reformation of a grant deed.
In the trial court, the CoG presented evidence that New Hope intended to give the CoG a power of termination. The CoG offered the deed itself and the declaration of Alvin Shackleton, New Hopes pastor from 1956 to 1983, an officer of the corporation until 1990. He continued attending the church thereafter. Shackeltons declaration established New Hopes lengthy affiliation with the CoG and the history of its governing documents. He testified that New Hopes Board of Trustees intended to protect its property from unscrupulous church leaders and groups within the church by preventing them from taking control of New Hope property. Indeed, he testified the purpose of the 1991 deed was to prevent the very situation that had occurred. The CoG also offered Estebos deposition testimony, which established that the board of trustees was aware of the language of the deed in 1991 and approved it as written. This evidence was sufficient to meet the CoGs burden on summary judgment that the deed reflected the intent of the parties.
New Hope, however, argues that it did not intend to forfeit its property to the CoG. It offered no admissible evidence on this point in the court below and offers none here — it is merely an unsupported, bald-faced assertion. New Hope has simply failed to offer evidence sufficient to defeat — or even call into question — its intent at the time of execution as evidenced by the plain language of the deed. New Hope may feel that it executed the deed unwisely, or if it had to do it over again, would not make the same decision. Those are not, however, grounds for reformation of the deed. We find the trial court properly granted summary judgment to the CoG on New Hopes cause of action for reformation.
The CoG further argues that even if New Hope had offered evidence sufficient to create a triable issue on this point, New Hopes reformation cause of action was flawed as a matter of law. New Hope was essentially requesting the court to remove the entire clause containing the power of termination. Such relief is not available under
Civil Code section 3399, which provides only for reforming an instrument to reflect the true intent of the parties. Reformation cannot be used to create a new instrument which the evidence does not prove was ever agreed to by the parties. (Bailard v. Marden (1951) 36 Cal.2d 703, 709-710.)
Ecclesiastical Matters
Well-established law imposes limits on a civil courts jurisdiction over the administration and other internal matters concerning ecclesiastical institutions. "The United States Supreme Court has adopted a two-pronged analysis in intrachurch disputes involving property. Civil courts may employ `"neutral principles of law, developed for use in all property disputes," as the basis for resolving such disputes, unless this determination depends on the resolution of an ecclesiastical controversy over religious doctrine, practice or polity. [Citations.] Difficulties arise when application of the neutral principles approach to a particular dispute requires a civil court to examine the governing documents of a religious organization, such as a church constitution, articles of incorporation, bylaws or instruments of property ownership. To the extent the interpretation or construction of these documents involves the resolution of a matter of ecclesiastical doctrine, polity or administration, the civil court must defer to the resolution of the issue by the `authoritative ecclesiastical body. [Citation.] Significantly, such ecclesiastical matters include not only issues of religious doctrine per se, but also issues of membership, clergy credentials and discipline, and church polity and administration. [Citations.] (Concord Christian Center v. Open Bible Standard Churches (2005) 132 Cal.App.4th 1396, 1411.)
New Hope argues that summary judgment was improper because the trial court wrongfully interjected itself into ecclesiastical matters. Specifically, New Hope claims the "lower Court considered factually whether or not Respondent and/or Petitioner
[New Hope] were or were not in continued fellowship or doctrinal unity with each other . . . ." In support of this assertion, New Hope quotes a few sentences from the reporters transcript without context.
We find this argument to be without merit; indeed, it is specious, and an improper attempt to create a constitutional issue where none exists. The trial court was not required to, and did not, make any factual finding as to whether it believed New Hope and the CoG continued to be in fellowship or doctrinal unity. Under the plain language of the deed, all the trial court was required to find was whether the CoG believed that was no longer the case: "[I]f in the opinion of said Association of the Church of God, [New Hope] is no longer in fellowship and doctrinal unity with the Church of God Reformation Movement, this property shall go to, vest in and become the property, in fee simple, of the Association of the Church of God of Southern California."
Thus, the court had no reason to determine whether the parties were in fellowship and doctrinal unity. It made no such finding, which would have been legally improper and irrelevant in any event. The terms of the deed did not call for the court to determine that issue; it was the CoGs opinion that mattered. Indeed, it does not appear to be a factual issue that New Hope disputes. The trial court did not err.
New Hope also claims the trial court failed to determine the hierarchical structure of the CoG. New Hope claims this was relevant to issues in the case, although the cases it cites on this point are entirely distinguishable and raise different issues from the one at bar. New Hope seems to argue that because of its nature as a congregational church, the trial court was overly deferential to the CoG. New Hope fails to demonstrate, however, how the legal analysis in this particular case would have been any different if the trial court had determined it was a congregational church, nor does it cite to that portion of the record in which it asked the trial court to make such a determination. We cannot find any indication at all that New Hope raised this issue below.
New Hopes arguments as to the trial courts intervention in ecclesiastical matters are entirely without merit. The trial courts decision, as reflected by the record, was made according to neutral principles of real property law.
Form of the Judgment
After submitting its initial proposed order granting summary judgment, the CoG later filed a declaration from one of its attorneys and a revised proposed order. (New Hope repeatedly refers to the declaration as an "ex parte" communication, yet the record shows that copies were served.) New Hope claims, without any specificity, that the relief sought by the revised order was beyond the scope of the CoGs complaint. New Hope does not, however, cite to any part of the record showing that it objected to the form of the judgment, and therefore cannot raise it on appeal. Further, this is argument is waived for failure to support it with legal argument. (Kurinij v. Hanna & Morton (1997) 55 Cal.App.4th 853, 865.)
Sanctions
The CoG filed a motion seeking sanctions for a frivolous appeal on March 27, 2007. While we agree that the appeal is without merit, we do not believe it supports sanctions. Thus, the motion for sanctions is denied.
III
DISPOSITION
The judgment is affirmed. The CoG is entitled to its costs on appeal.
We concur:
OLEARY, Acting P. J.
ARONSON, J.