NYLJ Religion Law Column Authored by NMB – Hiring and Firing of Clergy

In the Friday, May 31, 2019 issue of the New York Law Journal, NMB partners Barry Black and Jonathan Nelson examine the differences of between hierarchical and congregational governing structures of religious institutions, and the understanding of the roles that trustees and congregations have authority over of hiring and firing affairs. Barry and Jonathan also outline practical considerations for congregations to be mindful of when making decisions about clergy.

Check out a link to the full New York Law Journal article here.


Senator Ted Cruz Begins Investigation of Yale Law School Over Alleged Religious Discrimination

On April 4, after Yale Law School announced that it “will not financially support employment positions unless they are open to all of our student body” and that it “will not fund the work of an employer that refuses to hire students because they are, for instance, Christian,
black, a veteran, or gay,” U.S. Sen. Ted Cruz (R-Texas) notified Yale Law School Dean Heather Gerken of his intention to investigate Yale’s policy.

On April 4, after Yale Law School announced that it “will not financially support employment positions unless they are open to all of our student body” and that it “will not fund the work of an employer that refuses to hire students because they are, for instance, Christian, black, a veteran, or gay,” U.S. Sen. Ted Cruz (R-Texas) notified Yale Law School Dean Heather Gerken of his intention to investigate Yale’s policy.

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Religious School Students’ Suit Challenging Vermont Program Gains Justice Department Support

The U.S. Department of Justice has filed a statement of interest in a case pending in the
U.S. District Court for the District of Vermont in support of parents and parochial high school
students who claim that Vermont has discriminated against them in violation of the Free Exercise
Clause of the First Amendment to the U.S. Constitution.

The plaintiffs in the case, A.M. v. French, assert that their Free Exercise rights have been
violated because the state does not permit them to participate in a state program that pays tuition
for high school students to take up to two college courses. 

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Federal Government Releases Final ‘Conscience Rule’

The U.S. Department of Health and Human Services (“HHS”) Office for Civil Rights (“OCR”) has issued its final “conscience rule.”

In a statement, the HHS said that the 440 page final rule “protects individuals and health care entities from discrimination on the basis of their exercise of conscience in HHS-funded programs.” The HHS added that the final rule implements “full and robust enforcement of approximately 25 provisions passed by Congress protecting longstanding conscience rights in healthcare.”

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7th Circuit Upholds ‘Parsonage Allowance’ Against First Amendment Challenge

The U.S. Court of Appeals for the Seventh Circuit, reversing a district court’s decision, has ruled that the Internal Revenue Code provision excluding housing allowances from ministers’ taxable income does not violate the First Amendment and is not unconstitutional.

The Parsonage Allowance

After the Sixteenth Amendment to the U.S. Constitution was ratified in 1913, authorizing Congress to levy an income tax, Congress enacted the federal income tax. Thereafter, the Treasury Department adopted the “convenience-of-the-employer” doctrine in connection with the definition of taxable “income.” Under that doctrine, housing provided to employees for the convenience of their employer is exempt from the employees’ taxable income.

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This Time, US Supreme Court Stops an Execution Where State Refuses Minister’s Presence

Just about one month after the U.S. Supreme Court permitted Domineque Ray, a Muslim prisoner, to be executed without his minister being present, the Court stopped another execution where a prisoner was denied the presence of his spiritual advisor.

In Murphy v. Collier, 587 U. S. ____ (2019), the Court stayed the execution of Patrick Murphy by the state of Texas, declaring that the state “may not carry out Murphy’s execution” unless the state “permits Murphy’s Buddhist spiritual advisor or another Buddhist reverend of the [s]tate’s choosing to accompany Murphy in the execution chamber during the execution.”

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Nelson Madden Black Obtains Court Order Invalidating Mortgage on Church Property

In an important victory for a Nelson Madden Black client, the New York State Supreme Court has invalidated a mortgage on church property that did not comply with the requirements of the New York Religious Corporations Law.

This appears to be the first time that a court has struck down a “hard money” mortgage – that is, a mortgage securing a short term loan at high rates, with a balloon payment due at the end of the term – after finding that it was not fair to a church when it was made and that it was not in the church’s best interest to enforce it now.

The court battle over the mortgage began in April 2010, when the lender sought to foreclose on the mortgage. By 2018, when Nelson Madden Black began to represent the church, the lender had been awarded summary judgment and was seeking to foreclose on its mortgage. Nelson Madden Black overcame judgment in favor of the lender and, now, has obtained summary judgment in favor of the church.

Nelson Madden Black demonstrated that the mortgage was invalid from the beginning because it did not comply with the Religious Corporations Law, and persuaded the court not to retroactively approve it.

The decision has been published by the New York Law Journal and is available at: https://www.law.com/newyorklawjournal/almID/1553231389NY1088510/

Nelson Madden Black LLP – Church Client Escapes Foreclosure

A recent decision of the Kings County New York Supreme Court invalidated a 12-year old mortgage in foreclosure proceedings. When the Grace Christian Church hired Nelson Madden Black, the court had already granted summary judgment against it, enforcing a second mortgage given to a “hard money” lender. But with hard work and persistence, firm lawyers, led by partner Jonathan Nelson, persuaded the court to vacate the initial ruling, and grant summary judgment to the church invalidating the mortgage. Having initially neglected to obtain judicial approval of the mortgage, as the law required, the lender had asked the court to approve it nunc pro tunc. The court questioned whether the mortgage was fair at the time of its making, noting that the church’s congregation had never approved the borrowing, which had increased at the closing beyond the amount approved by the church trustees, and observing that the loan may have been “doomed to failure” if the church could not repay it when the balloon payment came due. Looking to the present day, the court concluded that it would not be in the best interest of the church to lose its house of worship from the foreclosure of the mortgage, and granted summary judgment dismissing the lender’s complaint. The case sends a cautionary message to lenders not to overreach when lending money to religious institutions, and to make doubly sure that the loan’s terms are fair, reasonable and in the borrower’s long-term best interests.

Department of Education Lifts Limit on Religious Organizations Providing ‘Equitable Services’ to Private Schools

The U.S. Department of Education (“DOE”) will no longer enforce a restriction in federal law that bars religious organizations solely because of their religious affiliation from contracting to provide equitable services – such as special education and tutoring – to private schools.

Secretary of Education Betsy DeVos announced the change in policy at a meeting of the Council for American Private Education (“CAPE”) and in a letter to Nancy Pelosi, the Speaker of the House of Representatives

Sections 1117(d)(2)(B) and 8501(d)(2)(B) of the Elementary and Secondary Education Act (“ESEA”) require that, under specific ESEA programs, state and local educational agencies (“SEAs” and “LEAs”) provide services or other benefits to certain private school students, teachers, and families that are equitably comparable to those services provided in public schools. An SEA or LEA must provide equitable services either directly using its own employees or through a contract with an individual, association, agency, or organization. In providing such services, the employee or third-party provider must be “independent of the private school and of any religious organization,” according to the ESEA.

The secretary said that the DOE consulted with the U.S. Department of Justice and determined that the requirement that providers of equitable services to private schools must “be independent of . . . any religious organization” was unconstitutional because it categorically excluded religious organizations based solely on their religious identity.

The secretary said that the restriction ran counter to the U.S. Supreme Court’s 2017 decision in Trinity Lutheran Church of Columbia, Inc. v. Comer, which held that, under the Free Exercise Clause of the First Amendment of the U.S. Constitution, otherwise eligible recipients could not be disqualified from a public benefit solely because of their religious character.

Given the Supreme Court’s Trinity Lutheran decision, the secretary said, the DOE would no longer enforce these two ESEA sections, which have restricted school districts from contracting with religious organizations to provide equitable services on the same basis as any other organization.

“The Trinity Lutheran decision reaffirmed the long-understood intent of the First Amendment to not restrict the free exercise of religion,” the secretary said in a prepared statement. “Those seeking to provide high quality educational services to students and teachers should not be discriminated against simply based on the religious character of their organization.”

In her letter to Speaker Pelosi, the secretary explained that, “Permitting religious organizations and secular organizations alike to provide secular services to schools does not violate the Establishment Clause,” and that, absent specific language to the contrary such as contained in Sections 1117(d)(2)(B) and 8501(d)(2)(B), the DOE “generally considers faith-based organizations to be eligible to contract with grantees and subgrantees” and to apply for and receive DOE grants “on the same basis as any other private organization.”

The secretary concluded that the DOE would continue to enforce all other applicable provisions of federal law. In particular, she pointed out, under ESEA Sections 1117(a)(2) and 8501(a)(2), school districts must continue to ensure that any contractor is independent of the private school for which it is providing services and that the educational services and other benefits being provided by a contractor are “secular, neutral and non-ideological.”

NMB Partner Authored an Article for NYLJ on Eruv

Partner  Barry Black authored an article for the New York Law Journal featured in their March 1st edition. 

The article touched on the centuries-old practice of Orthodox Jews preventing them from pushing or carrying objects outside their homes on the Sabbath and on Yom Kippur, yet those prohibitions are lifted within an eruv, a ritual demarcation of an area.

Barry discusses recent and historical decisions on the practice and offers insight into how both sides of the community should approach the practice. 

Click Here to read the full article.