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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. St. Paul Church, Inc. v. Board of Trustees of the Alaska Missionary Conference of the United Methodist Church, Inc. (10/13/2006) sp-6061

St. Paul Church, Inc. v. Board of Trustees of the Alaska Missionary Conference of the United Methodist Church, Inc. (10/13/2006) sp-6061, 145 P3d 541

     Notice:   This opinion is subject to correction  before
     publication  in  the  Pacific  Reporter.   Readers  are
     requested to bring errors to the attention of the Clerk
     of  the  Appellate  Courts, 303  K  Street,  Anchorage,
     Alaska 99501, phone (907) 264-0608, fax (907) 264-0878,
     e-mail corrections@appellate.courts.state.ak.us.


            THE SUPREME COURT OF THE STATE OF ALASKA


ST. PAUL CHURCH, INC., an )
Alaska Corporation, PAT TURNER, ) Supreme Court Nos. S-11641/11661
CHRIS CASE, THOMAS J. )
HALLINAN, ROBERT F. ) Superior Court No.
CARLSON, and CAM CARLSON, ) 4FA-02-02290 CI
)
Appellants/ ) O P I N I O N
Cross-Appellees, )
) No. 6061 - October 13, 2006
v. )
)
BOARD OF TRUSTEES OF THE )
ALASKA MISSIONARY )
CONFERENCE OF THE UNITED )
METHODIST CHURCH, INC., )
)
Appellee/ )
Cross-Appellant. )
)



          Appeal  from the Superior Court of the  State
          of    Alaska,   Fourth   Judicial   District,
          Fairbanks, Richard D. Savell, Judge.

          Appearances:   John J. Burns and  Corinne  M.
          Vorenkamp,  Borgeson & Burns, PC,  Fairbanks,
          for  Appellants and Cross-Appellees.   Thomas
          H. Dahl and Joseph W. Sheehan, Law Offices of
          Joseph  W.  Sheehan, Fairbanks, for  Appellee
          and Cross-Appellant.

          Before:   Bryner,  Chief  Justice,  Eastaugh,
          Fabe,  and  Carpeneti, Justices.   [Matthews,
          Justice, not participating.]

          FABE, Justice.

I.   INTRODUCTION
          St.  Paul  Church, Inc., formerly a local affiliate  of
The  United  Methodist  Church,  was  discontinued  as  a  United
Methodist  Church  by  the Alaska Missionary  Conference  of  The
United Methodist Church.  Following the discontinuance, a dispute
arose   between  St.  Paul  Church  and  the  Alaska   Missionary
Conference  over  two parcels of property that  St.  Paul  Church
acquired when it was affiliated with The United Methodist Church.
Applying an approach that relied on neutral principles of law  to
this  issue of first impression in Alaska  how property  disputes
should  be  resolved following a schism between religious  groups
the   superior  court  determined  that  the  Alaska   Missionary
Conference was entitled to possession of the disputed properties.
St. Paul Church appeals.  Because we agree with both the neutral-
principles approach adopted by the superior court and the  result
it  reached,  we  affirm.   We also affirm  the  superior  courts
determination that the individually named appellants  are  liable
for trespass and conversion with respect to the property properly
awarded   to  the  Alaska  Missionary  Conference.   The   Alaska
Missionary  Conference  cross-appeals, seeking  reversal  of  the
superior courts determination that St. Paul Church, and  not  the
Alaska  Missionary  Conference,  is  entitled  to  the  St.  Paul
corporate entity and the name St. Paul Church.  Because we  agree
with  the  superior  court that St. Paul Church  is  entitled  to
retain its independent corporate existence and name, we affirm.
II.  FACTS AND PROCEEDINGS
     A.   Facts
          1.   The  United  Methodist Church,  Alaska  Missionary
               Conference, and The Book of Discipline
               
          The  United  Methodist  Church  (UMC)  is  a  worldwide
religious denomination organized by conferences, each covering  a
wider  geographic  scope, beginning with  the  local  church  and
charge  conference  and extending through the  district,  annual,
jurisdictional  (regional),  and  [g]eneral  [c]onferences.   The
Board of Trustees of the Alaska Missionary Conference of the  UMC
(AMC)  is  an  Alaska nonprofit corporation and is  the  regional
conference of UMC that represents Alaska.
          The Book of Discipline is the book of law of The United
Methodist  Church.1  The Discipline sets forth the organizational
structure  of  UMC2  and  contains a chapter  devoted  to  church
property.3  According to the Discipline:
          The United Methodist Church is organized as a
          connectional  structure, and  titles  to  all
          real  and  personal, tangible and  intangible
          property  held  at  general,  jurisdictional,
          annual, or district conference levels, or  by
          a  local church or charge, or by an agency or
          institution of the Church, shall be  held  in
          trust  for  The United Methodist  Church  and
          subject    to   the   provisions    of    its
          Discipline.[4]
          
          Paragraph  2503  of  the Discipline  sets  forth  trust
language  which all written instruments conveying  real  property
for  purposes of worship or as parsonages shall contain,  to  the
effect  that all property is being held in trust for  UMC.5   The
Discipline later provides:
          [T]he  absence of a trust clause  .  .  .  in
          deeds and conveyances executed previously  or
          in the future shall in no way exclude a local
          church  or  church agency, or  the  board  of
          trustees of either, from or relieve it of its
          connectional responsibilities to  The  United
          Methodist  Church.  Nor shall  it  absolve  a
          local church or church agency or the board of
          trustees of either, of its responsibility and
          accountability   to  The   United   Methodist
          Church, including the responsibility to  hold
          all  of  its property in trust for The United
          Methodist Church; provided that the intent of
          the  founders and/or a later local church  or
          church  agency, or the board of  trustees  of
          either,  is  shown  by  any  or  all  of  the
          following:
          
          a)   the  conveyance  of the  property  to  a
               local  church or church agency  (or  the
               board  of  trustees of  either)  of  The
               United    Methodist   Church   or    any
               predecessor  to  The  United   Methodist
               Church;
               
          b)   the use of the name, customs, and polity
               of  The  United Methodist Church or  any
               predecessor  to  The  United   Methodist
               Church in such a way as to be thus known
               to  the  community as  a  part  of  such
               denomination; or
               
          c)   the  acceptance  of  the  pastorate   of
               ordained ministers appointed by a bishop
               or employed by the superintendent of the
               district  or  annual conference  of  The
               United    Methodist   Church   or    any
               predecessor  to  The  United   Methodist
               Church.[6]
               
          Paragraph  2506  of  the Discipline  notes  that  these
property provisions are subordinate to local law:
          All provisions of the Discipline relating  to
          property,   both  real  and   personal,   and
          relating  to  the formation and operation  of
          any  corporation, and relating to mergers are
          conditioned  upon their being  in  conformity
          with  the  local laws, and in  the  event  of
          conflict  therewith  the  local  laws   shall
          prevail;   provided,   however,   that   this
          requirement  shall not be construed  to  give
          the consent of The United Methodist Church to
          deprivation  of  its  property  without   due
          process  of law or to the regulation  of  its
          affairs   by   state   statute   where   such
          regulation    violates   the   constitutional
          guarantee   of   freedom  of   religion   and
          separation  of church and state  or  violates
          the   right   of  the  Church   to   maintain
          connectional structure . . . .[7]
          
          The  Discipline contemplates discontinuation of a local
church  and provides for property disposition in the  wake  of  a
discontinuance:
          A   recommendation  of  discontinuance  shall
          include recommendations as to the future  use
          of the property and where the membership .  .
          . and the title to all the real and personal,
          tangible and intangible property of the local
          church   shall  be  transferred.    On   such
          recommendation that a local church no  longer
          serves the purpose for which it was organized
          and incorporated . . . , with the consent  of
          the  presiding bishop and a majority  of  the
          district  superintendents  and  the  district
          board of church location and building of  the
          district in which the action is contemplated,
          the  annual conference may declare any  local
          church within its bounds discontinued.[8]
          
It further provides:

          [W]hen  a  local church no longer serves  the
          purpose  for  which  it  was  organized   and
          incorporated . . . , with the consent of  the
          presiding bishop, a majority of the  district
          superintendents, and of the district board of
          church  location  and  building,  the  annual
          conference trustees may assume control of the
          real  and  personal, tangible and  intangible
          property.  . . . The conference trustees  may
          proceed  to  sell  or  lease  said  property,
          retain  the  proceeds in an  interest-bearing
          account, and recommend the disposition of the
          proceeds  in  keeping with annual  conference
          policy.   It shall be the duty of the  annual
          conference  trustees to  remove,  insofar  as
          reasonably possible, all Christian and church
          insignia and symbols from such property.[9]
          
          2.   St.  Paul Church, Inc. and the individually  named
               appellants
               
          In  1983  a  group  of families in the  Fairbanks  area
          contacted AMC, expressing interest in forming a new UMC
congregation.   In  a letter dated February  21,  1984  to  Larry
Bennett,  one  of  the early members of St. Paul  Church,  Bishop
Calvin D. McConnell informed Bennett:
          All property of United Methodist Churches  is
          owned  in  trust  on  behalf  of  The  United
          Methodist Church.  There is no such thing  as
          locally  owned property.  When a congregation
          votes to purchase real estate and to build  a
          building on it, they obligate themselves with
          the   financial  responsibilities   of   such
          purchase   and  construction  and  continuing
          maintenance.  But they do so as part  of  the
          connection    of   all   United   Methodists.
          Property   is   held   on   behalf   of   the
          denomination as a whole for its strategically
          missional  purposes.   When  a  new   forming
          religious community agrees to become a United
          Methodist   Church   they   agree   to    its
          constitution, Articles of Religion,  and  its
          polity  and  governance.  Part of its  polity
          and  governance involves property being  held
          in  trust  on behalf of The United  Methodist
          Church.
          
And also:

          I go into all of this to indicate that we are
          a  connectional church.  The local church  is
          tied  together  with others  for  the  mutual
          benefit  of  one  another in mission  to  the
          world.   Property is held in  common  by  the
          denomination, with each local church assuming
          the  responsibilities and enjoyment of  using
          its  own property, maintaining it, developing
          it, and improving it.  If a congregation,  or
          a  portion of it, should at any point in  its
          history  decide to separate from  The  United
          Methodist Church, it could certainly  do  so,
          but  could not take the title of the property
          with  them.   The  property is  held  by  the
          denomination to assure the means of providing
          continuing  ministry on behalf of The  United
          Methodist Church in that location.
          
Bishop  McConnell also referred Bennett to the paragraphs of  the
Discipline  relating to property ownership, and  he  quoted  with
emphasis from Paragraph 2501:
          The United Methodist Church is organized as a
          connectional  structure, and  titles  to  all
          properties  held  at General, Jurisdictional,
          Annual, or  District Conference Levels, or by
          a  local church or charge, or by an agency or
          institution of the church, shall be  held  in
          trust  for  The United Methodist  Church  and
          subject to the provisions of its DISCIPLINE.
          
The letter then noted:

          Incidentally,  there have  been  some  rather
          unfortunate civil suits against denominations
          such as United Methodist and Presbyterian  to
          challenge this concept of property being held
          in  trust.   In  every case the civil  courts
          have upheld the denomination.
          
          I  do not go into such long detail about this
          matter  to intimidate you or discourage  you,
          but  only  to  inform  you.   It  would  seem
          important   to   me   that  your   developing
          congregation  understand the implications  of
          the  connectional nature of this  undertaking
          in  establishing a new local church.   It  is
          something that is being done together.   Your
          group  needs to be sure that it really  wants
          to  be  United Methodist.  If so,  there  are
          certain  understandings  which  are  inherent
          within  it . . . [including] holding property
          in trust on behalf of the denomination.
          
          From  January 1984 through April 1984, members  of  the
St.  Paul  Church  community signed a Statement of  Intent  which
declared  that  they  were intending to  present  themselves  for
membership  in  UMC  and  that they  would  worship  and  conduct
business in accordance with The Book of Discipline of The  United
Methodist  Church.   On April 15, 1984, St. Paul  was  granted  a
Certificate of Organization by AMC, stating that it had been duly
constituted according to the provisions of the Discipline of UMC.
Parties  to  this  litigation, Robert Carlson, Cam  Carlson,  and
Thomas Hallinan, signed the Statement of Intent.
           St.  Paul  Church  was  incorporated  as  a  religious
corporation  on November 23, 1984 under the name St. Paul  United
Methodist Church.  The stated purposes of the corporation were
          to promote Christian religion, conduct public
          worship, conduct religious education, perform
          acts of charity, acquire, hold or dispose  of
          church  property and funds and  perform  such
          other  lawful  acts as may be necessary  from
          time  to  time, subject to the Discipline  of
          The  United  Methodist Church and  ultimately
          subject  to the word of God as found  in  the
          Old and New Testaments of the Bible.
          
          To  receive and maintain a fund or  funds  of
          real   or  personal  property  or  both  and,
          subject  to  the restrictions and limitations
          hereinafter set forth, to use and  apply  the
          whole or any part of its income therefrom and
          the   principle   thereof   exclusively   for
          religious, charitable or educational purposes
          of the corporation directly . . . .
          
The Articles of Incorporation further provided:

          Upon  dissolution of the corporation, or upon
          the conclusion of its affairs, the assets  of
          the  corporation shall be distributed to such
          religious,    charitable,    or     education
          organization(s) as the Board of Trustees  may
          select,   which  are  carrying  on  functions
          consistent   with   the   purpose   of   this
          corporation . . . .
          
          Under  the Articles, the Board of Trustees shall be  in
charge  of  all  property  of  the  Church  and  of  the  act  of
incorporating the Church.  The Articles were signed by Robert  F.
Carlson, Trustee in Trust as Chairman of the Board of Trustees.
          In  1988  St.  Paul  Church  purchased  two  pieces  of
property,  a  parsonage  and land upon which  it  later  built  a
church.   Title to both properties was in the name  of  St.  Paul
United  Methodist  Church.  Neither of the  deeds  contained  the
trust  language  set forth in Paragraph 2503 of  the  Discipline.
St.  Paul  annually informed AMC of its failure  to  include  the
trust  language in the deeds when it submitted its annual reports
to  the  trustees of AMC, and answered no to the question whether
each deed contained a trust clause.
          In November 1986 a letter was sent to St. Paul from the
General  Board  of Global Ministries of the UMC (GBGM)  informing
that,  pursuant to its application for a grant to assist  with  a
land  purchase, the GBGM had approved a $25,000 grant to St. Paul
on  the condition that a Trust Agreement and Mortgage be recorded
against  the local church as security for the donation of mission
funds.   The  letter  stated  that [t]he  National  Division,  in
granting a conditional donation to a church, requires that a lien
be  placed upon the property for the return of the monies in  the
event  that the property should be ever sold, alienated from  The
United Methodist Church, or cease to be used for church purposes.
The Trust Agreement and Mortgage was signed on November 9, 1990.
          The  introductory  clauses of the Trust  Agreement  and
Mortgage provide in relevant part:
          Whereas  the  party of the  first  part  does
          hereby  represent  and declare  that  it  has
          acquired  title to, and does  now  hold,  the
          premises hereinafter described, and that said
          premises  shall be held, kept, and maintained
          as  a  place  of residence for  the  use  and
          occupancy  of  the ministers  of  The  United
          Methodist Church, who may from time  to  time
          be   entitled   to   occupy   the   same   by
          appointment,   and/or[]   used,   kept    and
          maintained, as a place of divine  worship  of
          the United Methodist ministry and members  of
          The  United Methodist Church; subject to  the
          Discipline,     usage,    and     ministerial
          appointments of said church as from  time  to
          time  authorized and declared by the  General
          Conference  of  said church, and  the  Annual
          Conference  within  whose  bounds  the   said
          premises are situated[.]
          
The agreement later states:

          [I]n  case  [St.  Paul]  shall  cease  to  be
          connected  with The United Methodist  Church,
          or  its successor, or the corporate existence
          of  [St.  Paul] shall cease, or the  property
          hereinafter described shall ever hereafter be
          alienated  from The United Methodist  Church,
          or  cease  to  be used for or be  devoted  to
          other  uses and purposes than the  uses  [or]
          purposes  set forth herein, then, [St.  Paul]
          shall  and will forthwith repay to the  party
          of the second part, the successors or assigns
          thereof, the said amount with lawful interest
          thereon,  from  the  date  of  the  aforesaid
          alienation, dissolution or abandonment.
          
          3.   The discontinuation
               
          Following a period of conflict between members  of  the
lay  congregation of St. Paul and the regional administration  of
UMC,  on  December  8, 2001, Reverend Rachel  Lieder  Simeon,  on
behalf of the Cabinet of AMC, informed Reverend Don Strait,  then
interim  pastor  at St. Paul, and Judy Stoop, the chairperson  of
the   Staff   Parish  Relations  Committee,  that  it   was   the
recommendation  of the Cabinet of AMC that St.  Paul  acknowledge
the  need  for  new  lay leadership.  The communication  informed
Strait  and Stoop that a formal request was being made  that  the
lay  leadership of St. Paul step aside in order to facilitate the
development  of new leadership.  It was further recommended  that
the new leadership stay in office for no less than three years.
          On  January 22, 2002, a meeting was held at  St.  Paul,
and  lay leaders were elected in a manner contrary to the  wishes
of AMC.  Subsequently, in February 2002 Lieder Simeon recommended
to  AMCs Administrative Unit that UMC cease its affiliation  with
St. Paul.
          On  May  22, 2002, St. Paul filed a verified  complaint
for  a temporary restraining order, a preliminary injunction, and
a permanent injunction asking the superior court to enjoin a vote
on  the  discontinuation because AMC was not following the proper
discontinuation  procedure under the  Discipline.   The  superior
court,  finding that the lawsuit concerned the internal  workings
of  The  United  Methodist  Church and  that  the  court  had  no
jurisdiction  to determine the question, granted AMCs  motion  to
dismiss the complaint.
          At  the Annual Meeting of AMC on May 30, 2002, St. Paul
was discontinued.  According to the minutes, at the outset of the
meeting, Bishop Paup reminded all that we are not owners  we  are
custodians.   Lieder Simeon also informed the conference:
          It  is  important to realize that we are  not
          making  a determination as to whether or  not
          St.  Paul should exist as a church.  The only
          determination   we   make,   as   an   annual
          conference of The United Methodist Church, is
          whether  or not St. Paul should be  continued
          as a United Methodist Church.
          
The  vote  for  discontinuance  was  recorded  as  sixty-one  for
discontinuance  and  one  against  discontinuance,  with   Robert
Carlson the only person voting against discontinuance.
          With  respect to disposition of property,  the  minutes
read:
          Superintendent Rachel Lieder Simeon  reminded
          the conference that all local church property
          is   held  in  trust  for  the  denomination.
          Whenever a church ceases to exist as a United
          Methodist entity, all the property and assets
          revert to the denomination.
          
          Recommendation concerning the disposition  of
          property:
          The   Administrative  Unit  of   the   Alaska
          Missionary  Conference  recommends  that  the
          Alaska Missionary Conference retain the title
          and  asset[s]  of the current  parsonage  and
          make  the  church  property available  to  an
          appropriate body for continuation as a church
          on that site.  Further, we recommend that the
          Board  of  Trustees of the Alaska  Missionary
          Conference   be  empowered  by   the   annual
          conference  to  negotiate the  terms  of  the
          transfer  of deed and property.  If agreement
          cannot  be  reached between the parties,  the
          trustees  shall  be  empowered  to  work  out
          another arrangement.
          Recommendation supported.
          
          The  following recommendation was also made  concerning
the disposition of the membership:
          The     cabinet    recommends    that     the
          superintendent who has been in charge of  St.
          Paul   UMC  contact  the  current  membership
          within  one  month of the vote by the  Annual
          Conference  to  attempt  to  meet  with   the
          membership  and  work with those  who  desire
          assistance in finding a new church home.
          
          A  few  days  after  St. Paul was discontinued,  Rachel
Lieder Simeon accompanied a team to Fairbanks, entered the church
building and removed all books and other items that contained the
identification,  through word or symbol, of The United  Methodist
Church.   The  team also removed the UMC symbol  from  the  sign,
removed  office  equipment,  changed  the  locks  on  the  church
building  and  the parsonage, and withdrew the balance  from  St.
Pauls  bank account.  The team also affixed No Trespassing  signs
to the church.
          On  June  6, 2002, after the discontinuation, St.  Paul
amended its Articles of Incorporation, deleting all references to
UMC,  changing  its  name to St. Paul Church,  and  changing  its
status  from  a religious corporation to a nonprofit corporation.
In  mid-July  2002 St. Paul concededly regained  control  of  its
parsonage  and church buildings, and resumed regular  worship  in
the church.
     B.   Proceedings
          On  September  27, 2002, AMC filed a complaint  against
St.  Paul United Methodist Church, Inc., Pat Turner, Gary Koll,10
Chris  Case,  Thomas Hallinan, Robert Carlson, Cam  Carlson  (the
individually named appellants), and several John Doe  members  of
the  congregation  for  forcible entry and  detainer,  breach  of
contract,  trespass,  quiet  title,  and  ejectment  and   sought
declaratory  relief.  On October 23, 2002, AMC filed  an  amended
complaint which added a claim for breach of fiduciary duty.   St.
Paul  asserted the affirmative defenses of lack of subject matter
jurisdiction,  statute of limitations, estoppel, laches,  failure
of  consideration, waiver, and statute of frauds.  St. Paul  also
included   within   its  answer  to  the  amended   complaint   a
counterclaim for theft based on AMCs removal of personal property
from  the church and the withdrawal of $6,000 from St. Pauls bank
account.
          On   June  9,  2003,  AMC  moved  for  partial  summary
judgment, arguing that it  was entitled to judgment as  a  matter
of  law  for breach of contract, breach of fiduciary duty on  the
part  of the individually named appellants, ejectment, and  quiet
title.   On  April  5, 2004, St. Paul and the individually  named
appellants  moved  for  summary judgment on  all  claims  brought
against them.
          On  April 2, 2004, AMC moved to dismiss the answer  and
the  counterclaims of the individually named appellants for  lack
of  standing.  The superior court denied the motion on the ground
that the only counterclaim asserted in the responsive pleading of
the  defendants  was brought on behalf of St.  Paul  and  not  on
behalf  of the individually named appellants.  Therefore, it  was
irrelevant  if the individually named appellants had standing  to
bring a claim.
          On June 24, 2004, the superior court entered a judgment
of liability in favor of the Board of Trustees of AMC and against
St.  Paul  Church,  Inc. for trespass and conversion.   St.  Paul
Church appeals, arguing that the lower court did not apply a true
neutral-principles   approach  for  resolving   church   property
disputes in Alaska when it found that St. Paul was bound  by  the
rules  of  The Book of Discipline, and when it disregarded  basic
principles  of  trust and property law.  St. Paul further  argues
that  the superior court erred in finding the individually  named
appellants liable for trespass and conversion.
          On  August 2, 2004, the superior court awarded St. Paul
its  name  and  corporate existence.  AMC cross-appeals,  arguing
that  it  is entitled to these property rights.  AMC also revives
its  claim  that  the  individually named  appellants  should  be
dismissed from the lawsuit.
III. DISCUSSION
     A.   Standard of Review
          Constitutional  issues present questions  of  law,  and
they are reviewed de novo.11  The choice of the proper standard to
adopt  for resolving property disputes is a question of law  that
we  review  de  novo,12 adopting the rule of  law  that  is  most
persuasive in light of precedent, reason, and policy.13   Motions
to  dismiss,14  motions  for summary judgment,15  and  issues  of
standing16 are reviewed de novo.  In reviewing a grant of summary
judgment, we may affirm on any basis appearing in the record,  so
long as no new factual determinations are required.17
     B.   We  Adopt  a  Neutral-Principles Approach to  Resolving
          Church Property Disputes.
          
          1.   United States Supreme Court precedent
               
          In 1871 the United States Supreme Court first addressed
a  dispute over ownership of church property stemming from a rift
between  two  religious factions of a local church in  Watson  v.
Jones.18   In  analyzing  the dispute,  the  Court  distinguished
between    churches    with   congregational    or    independent
organizations, governed solely within themselves, and those where
a congregation was part of a larger, structured denomination.
          When  property disputes arose in hierarchical churches,
the  Court  adopted  an approach deferential  to  the  hierarchy,
explaining:
          [W]e  think  the rule of action which  should
          govern  the civil courts, founded in a  broad
          and sound view of the relations of church and
          state under our system of laws, and supported
          by   a   preponderating  weight  of  judicial
          authority is, that, whenever the questions of
          discipline,  or  of faith, or  ecclesiastical
          rule, custom, or law have been decided by the
          highest of these church judicatories to which
          the   matter  has  been  carried,  the  legal
          tribunals  must  accept  such  decisions   as
          final,  and  as  binding on  them,  in  their
          application to the case before them.[19]
          
          While  courts  began to make exceptions to  the  Watson
deference approach for fraud, collusion, or arbitrariness,20  the
Watson  approach was not substantially modified until the  United
States  Supreme  Courts decision in Presbyterian  Church  in  the
United  States v. Mary Elizabeth Blue Hull Memorial  Presbyterian
Church.21   Presbyterian Church involved the  withdrawal  of  two
local  churches  from the Presbyterian church because  the  local
organizations believed that certain actions of the general church
were departures from the doctrine and practice in force when they
became affiliated with the church.22  The local churches denounced
the  jurisdiction  of the general church, and  an  administrative
commission  appointed by the general church (after it  failed  to
broker a reconciliation) acknowledged the withdrawal of the local
church  and took over the local churches property.23   The  local
churches  did not appeal to higher church tribunals  but  instead
filed a civil suit in the Georgia courts.24  The Supreme Court of
          Georgia affirmed a jury verdict in favor of the local churches
that was based on the theory that Georgia law implied a trust  of
local  church property for the benefit of the general  church  on
the  sole  condition that the general church adhere to tenets  of
faith existing at the time of affiliation by the local churches.25
          The  United  States  Supreme Court reversed,  reasoning
that
          the  departure-from-doctrine element  of  the
          Georgia  implied  trust theory  requires  the
          civil court to determine matters at the  very
          core  of  religion   the  interpretation   of
          particular   church   doctrines    and    the
          importance   of   those  doctrines   to   the
          religion.    Plainly,  the  First   Amendment
          forbids  civil  courts from  playing  such  a
          role.[26]
          
          Significantly,  in  reaching its decision  the  Supreme
Court  in Presbyterian Church laid the foundation for a competing
view  of  the  proper  role of civil courts in  resolving  church
property disputes when it found that
          not every civil court decision as to property
          claimed    by    a   religious   organization
          jeopardizes  values protected  by  the  First
          Amendment.  Civil courts do not inhibit  free
          exercise of religion merely by opening  their
          doors  to disputes involving church property.
          And  there  are  neutral principles  of  law,
          developed  for use in all property  disputes,
          which  can  be  applied without  establishing
          churches  to which property is awarded.   But
          First    Amendment   values    are    plainly
          jeopardized  when church property  litigation
          is  made  to turn on the resolution by  civil
          courts   of   controversies  over   religious
          doctrine  and  practice.   If  civil   courts
          undertake  to  resolve such controversies  in
          order to adjudicate the property dispute, the
          hazards  are  ever present of inhibiting  the
          free development of religious doctrine and of
          implicating secular interests in  matters  of
          purely ecclesiastical concern.[27]
          
          In   a   concurring  opinion  in  Maryland  &  Virginia
Eldership  of the Churches of God v. Church of God at Sharpsburg,
Justice Brennan elaborated on the Courts decision in Presbyterian
Church,  noting  that  a  State may  adopt  any  one  of  various
approaches  for settling church property disputes so long  as  it
involves  no  consideration  of doctrinal  matters,  whether  the
ritual and liturgy of worship or tenets of faith.28  He noted that
courts  could  adopt  the  Watson  approach,  enforcing  property
decisions  made  within  a hierarchical  church  by  the  highest
authority within the church that ruled on the dispute.29   Citing
Presbyterian Church, he noted that
          [n]eutral  principles of law,  developed  for
          use  in all property disputes provide another
          means for resolving litigation over religious
          property.   Under the formal title  doctrine,
          civil  courts  can  determine  ownership   by
          studying deeds, reverter clauses, and general
          state   corporation  laws.   Again,  however,
          general principles of property law may not be
          relied  upon  if  their application  requires
          civil  courts  to  resolve doctrinal  issues.
          For  example,  provisions in deeds  or  in  a
          denominations constitution for the  reversion
          of  local  church  property  to  the  general
          church,  if  conditioned upon  a  finding  of
          departure from doctrine, could not be civilly
          enforced.[30]
          
          In  Jones  v.  Wolf, the latest United  States  Supreme
Court  decision  to offer guidance to state courts  in  resolving
church  property disputes, a five-to-four majority of  the  Court
expressly declined to find that the First Amendment requires  the
states  to  adopt  a  rule of compulsory deference  to  religious
authorities,  and held that a State is constitutionally  entitled
to  adopt neutral principles of law as a means of adjudicating  a
church  property  dispute.31   Its discussion  in  Jones  clearly
suggested  that while states retain the leeway to  implement  the
deference approach of Watson, the neutral- principles approach is
the preferred approach.
          The     primary     advantages     of     the
          neutral-principles approach are  that  it  is
          completely  secular  in  operation,  and  yet
          flexible  enough to accommodate all forms  of
          religious   organization  and  polity.    The
          method   relies  exclusively  on   objective,
          well-established  concepts   of   trust   and
          property law familiar to lawyers and  judges.
          It  thereby  promises to  free  civil  courts
          completely from entanglement in questions  of
          religious  doctrine,  polity,  and  practice.
          Furthermore, the neutral-principles  analysis
          shares  the  peculiar genius  of  private-law
          systems  in general  flexibility in  ordering
          private rights and obligations to reflect the
          intentions of the parties.[32]
          
While  expressing  some reservations about the neutral-principles
approach, the majority of the Court had sharper criticism for the
Watson  approach  when addressing a dissent  that  would  require
compulsory deference.
          The   dissent  suggests  that   a   rule   of
          compulsory  deference would  somehow  involve
          less  entanglement of civil courts in matters
          of    religious   doctrine,   practice,   and
          administration. Under its approach,  however,
          civil  courts  would always  be  required  to
          examine  the polity and administration  of  a
          church  to determine which unit of government
          has  ultimate  control over church  property.
          In  some cases, this task would not prove  to
          be  difficult.  But in others, the  locus  of
          control  would be ambiguous, and [a]  careful
          examination  of  the  constitutions  of   the
          general  and local church, as well  as  other
          relevant  documents, would  be  necessary  to
          ascertain  the form of governance adopted  by
          the members of the religious association.  In
          such  cases, the suggested rule would  appear
          to   require   a   searching  and   therefore
          impermissible  inquiry  into  church  polity.
          The neutral-principles approach, in contrast,
          obviates entirely the need for an analysis or
          examination  of  ecclesiastical   polity   or
          doctrine    in   settling   church   property
          disputes.
          
          The  dissent  also  argues  that  a  rule  of
          compulsory deference is necessary in order to
          protect the free exercise rights of those who
          have  formed  the association  and  submitted
          themselves  to its authority.  This  argument
          assumes  that  the neutral-principles  method
          would  somehow  frustrate  the  free-exercise
          rights   of   the  members  of  a   religious
          association.  Nothing could be  further  from
          the  truth.  The neutral-principles  approach
          cannot  be said to inhibit the free  exercise
          of  religion, any more than do other  neutral
          provisions of state law governing the  manner
          in   which   churches  own   property,   hire
          employees,  or  purchase  goods.  Under   the
          neutral-principles approach, the outcome of a
          church  property dispute is not foreordained.
          At  any  time before the dispute erupts,  the
          parties  can ensure, if they so desire,  that
          the  faction loyal to the hierarchical church
          will  retain the church property.   They  can
          modify the deeds or the corporate charter  to
          include  a  right of reversion  or  trust  in
          favor  of the general church.  Alternatively,
          the constitution of the general church can be
          made  to recite an express trust in favor  of
          the   denominational  church.    The   burden
          involved  in  taking  such  steps   will   be
          minimal.  And the civil courts will be  bound
          to give effect to the result indicated by the
          parties,  provided  it is  embodied  in  some
          legally cognizable form.[33]
          
Following Jones, state courts were permitted to adopt either  the
neutral-principles approach or the compulsory-deference approach,
resulting  in a split among the jurisdictions.  For example,  the
Supreme  Court of Pennsylvania in Presbytery of Beaver-Butler  of
the  United Presbyterian Church in the United States v. Middlesex
Presbyterian  Church,34 when considering which of  the  competing
approaches   to  adopt,  cited  California,  Georgia,   Illinois,
Maryland,  Missouri,  South  Dakota,  and  Ohio  as  among  those
jurisdictions  adopting  the  neutral-principles   view,35   with
Florida,  Iowa, Michigan, New Jersey, and West Virginia  adhering
to the Watson approach.36
          2.   Alaska Supreme Court precedents
          While  the  issue  of  resolution  of  church  property
disputes has never come squarely before us, and is thus an  issue
of  first  impression in Alaska, we have had the  opportunity  to
address  the  proper role of civil courts in evaluating  disputes
between  churches  and  church employees,  and  have  adopted  an
approach  similar  to  the  neutral-  principles  approach.    In
Marshall  v.  Munro, we held that while this court did  not  have
jurisdiction  over a breach of contract claim because  employment
disputes within churches are core ecclesiastical concerns outside
the  jurisdiction of the civil courts,37 we did have jurisdiction
over defamation and intentional interference with contract claims
against  a  minister  because it was  not  necessary  to  involve
ourselves in qualifications for the ministry when considering the
elements of the defamation claim.38
           In  McAdoo v. Diaz, we faced another defamation  claim
against  a minister and, citing Marshall v. Munro, noted that  we
would  allow  claims against the minister for  libel  to  proceed
because  they  did  not touch the merits of  any  core  religious
questions or present a religious question.39
          Considering   our   precedents,  the  superior   courts
analysis, the weight of authority favoring the neutral-principles
approach, and the compelling logic of the opinion of the majority
of the United States Supreme Court in Jones, we adopt the neutral-
principles  approach  when  resolving property  disputes  between
religious organizations.
     C.   Applying  Neutral  Principles to St.  Pauls  Claim,  We
          Agree that the Disputed Properties Belong to AMC.
          
          When  applying  neutral principles of  law  to  resolve
church  property disputes, courts generally examine the deeds  to
the church property, the charter of the local church, the book of
order  or discipline of the general church organization, and  the
state statutes governing the holding of the church property40  so
that  they may give effect to the intentions of the parties  with
respect  to the property.  Assessing these factors, the  superior
court concluded that the disputed properties belong to AMC.
          St.  Paul  argues that it never intended  to  create  a
trust  in favor of UMC, and finds fault with the superior  courts
decision, arguing that
          the lower court tacitly held that The Book of
          Discipline    trumped   St.    Paul,    Inc.s
          independent corporate charter, as well as St.
          Paul,  Inc.s  recorded property deeds.   This
          ruling,  based upon notions of hierarchy  and
          religious   deference  rather  than   neutral
          principles, unconstitutionally and improperly
          elevated   The   United   Methodist   Churchs
          assertion of a trust above established Alaska
          trust law.
          
Specifically, St. Paul argues that no trust can be found in favor
of  UMC, because: (1) there is no evidence of unequivocal  intent
to  create the trust by the settlor, St. Paul; (2) there  was  no
trust res at the time the trust was created; and (3) there is  no
document  that  complies with the statute of frauds.   We  reject
each argument in turn.
          1.   Unequivocal intent to create a trust
          St.  Paul  argues  that the language  of  The  Book  of
Discipline does not itself constitute a manifestation  of  intent
by  St.  Paul,  Inc.  to  give  The  United  Methodist  Church  a
beneficial  interest  in its property.  But  St.  Paul  seems  to
suggest that the articles of incorporation and the deeds  to  the
disputed properties themselves negate intent on the part  of  St.
Paul  to  create  a  trust.  We decline  to  adopt  either  polar
position  and instead view the relationship between St. Paul  and
UMC as a whole in order to discern intent.
          When  St. Paul chose to affiliate with UMC, the  record
reveals that its members were fully cognizant of the implications
of  affiliation.   At  the  time of affiliation,  the  Discipline
expressly stated:
          In  consonance with the legal definition  and
          self-understanding  of The  United  Methodist
          Church . . . and with particular reference to
          its  lack  of  capacity  to  hold  title   to
          property,  The  United  Methodist  Church  is
          organized  as  a connectional structure,  and
          titles  to all properties held .  .  .  by  a
          local church . . . shall be held in trust for
          The  United  Methodist Church and subject  to
          the provisions of its Discipline.
          
Through  the February 21, 1984 letter from Bishop McConnell,  the
founding members of St. Paul were informed:
          When a new forming religious community agrees
          to  become  a  United Methodist  Church  they
          agree   to  its  constitution,  Articles   of
          Religion,  and  its  polity  and  governance.
          Part  of  its polity and governance  involves
          property being held in trust on behalf of The
          United Methodist Church.
          
St. Pauls founders were also referred to the trust provisions  of
the  Discipline, and told, [y]our group needs to be sure that  it
really  wants to be United Methodist.  If so, there  are  certain
understandings  which are inherent within it .  .  .  [including]
holding property in trust on behalf of the denomination.  Yet the
members of St. Paul willingly presented themselves for membership
in  UMC  and  incorporated as St. Paul United  Methodist  Church.
Furthermore, St. Paul continued to affiliate with UMC, using  the
name, customs and polity of The United Methodist Church . . .  in
such  a  way  as to be known to the community as a part  of  such
denomination41 for almost twenty years, until the discontinuation.
Given  the  express  trust language of  the  Discipline  and  the
mutually  understood connectional nature of UMC, the  overt  acts
undertaken  by  the  members of St. Paul to  affiliate  with  UMC
constitute a manifestation of intent to create a trust  in  favor
of UMC.
          Contrary  to  the argument of St. Paul  that  it  is  a
violation  of neutral principles to rely upon provisions  of  the
Discipline when discerning the intent of St. Paul, examining  the
trust provisions of the Discipline in connection with the actions
of  the  parties is fully consonant with neutral principles.   As
when   parties  agree  to  be  bound  by  the  law   of   another
jurisdiction,  we  faithfully apply Alaska law  by  honoring  the
secular  rules  by which the parties have chosen to  be  bound.42
Furthermore, reliance upon trust language such as that  contained
in  the  Discipline  to  determine the objective  intent  of  the
parties  was  contemplated by and endorsed by the  United  States
Supreme Court in Jones, when it observed:
          [T]he neutral-principles analysis shares  the
          peculiar  genius  of private-law  systems  in
          general    flexibility  in  ordering  private
          rights   and   obligations  to  reflect   the
          intentions    of    the   parties.    Through
          appropriate  reversionary clauses  and  trust
          provisions,  religious societies can  specify
          what  is to happen to church property in  the
          event  of a particular contingency,  or  what
          religious  body will determine the  ownership
          in   the  event  of  a  schism  or  doctrinal
          controversy.  In  this  manner,  a  religious
          organization  can ensure that a dispute  over
          the  ownership  of  church property  will  be
          resolved  in accord with the desires  of  the
          members.[43]
          
          Although  the record is replete with evidence that  St.
Paul  intended  to affiliate with UMC, and thereby  undertook  to
hold  its property in trust in favor of UMC, St. Paul argues that
as the title holder, it is entitled to the presumption that it is
the  absolute owner, and that presumption has not been  overcome.
While St. Paul is correct that as the titleholder of the disputed
properties,  it  is entitled to the presumption that  it  is  the
owner of the disputed properties and this presumption may not  be
overcome  by  mere surmise or conjecture,44 the evidence  in  the
record  that  St. Paul intended to create a trust  far  surpasses
mere  surmise  and conjecture and is sufficient to  overcome  the
presumption.
          The deeds to the disputed properties are in the name of
St.  Paul  United  Methodist Church and they do not  contain  the
trust  clauses which the Discipline provides they shall  contain.
From the absence of the trust clauses, St. Paul asks that we draw
          the inference that it did not intend to impress its property with
a  trust  in  favor  of  the UMC.  But the  Discipline  expressly
provides  that the absence of a trust clause does not  relieve  a
local  church of its connectional responsibilities to UMC if  the
intent  of  the  founders of the church to hold the  property  in
trust is shown through the use of the name, customs and polity of
The  United Methodist Church.45  Since the deeds are recorded  in
the  name  of  St. Paul United Methodist Church,  the  deeds  are
consistent with the means set forth in the Discipline to manifest
an intent to create a trust.
          St.  Paul asks that we accord significance to the  fact
that  on  its  annual report forms submitted  to  AMC,  St.  Paul
annually informed the AMC that it did not put the trust clause in
its deeds and that the failure of AMC to insist upon inclusion of
the  trust clauses constituted a waiver of the trust requirement.
This  argument  is  unpersuasive in light of  the  default  trust
provisions  in the Discipline, of which St. Paul was made  aware.
Furthermore, the affirmative act of submitting annual reports  to
AMC  on  a yearly basis in itself constitutes yet another outward
manifestation of St. Pauls intent to affiliate with UMC.
          St. Paul also argues that the $25,000 GBGM mortgage  is
absolutely inconsistent with any other trust interest in favor of
The  United Methodist Church or its affiliated entities over  St.
Paul,  Inc.s real property.  It relies upon the provision of  the
Trust Agreement and Mortgage which states:
          [I]n  case  [St.  Paul]  shall  cease  to  be
          connected  with The United Methodist  Church,
          or  its successor, or the corporate existence
          of  [St.  Paul] shall cease, or the  property
          hereinafter described shall ever hereafter be
          alienated  from The United Methodist  Church,
          or  cease  to  be used for or be  devoted  to
          other  uses and purposes than the  uses  [or]
          purposes  set forth herein, then  [St.  Paul]
          shall  and will forthwith repay to the  party
          of the second part, the successors or assigns
          thereof, the said amount with lawful interest
          thereon,  from  the  date  of  the  aforesaid
          alienation, dissolution or abandonment.
          
However,  this  routine documentation of a financial  transaction
between  two distinct entities is immaterial in the face  of  the
manifest  intent  of St. Paul to affiliate with UMC.   Additional
language  within  the  very  same Trust  Agreement  and  Mortgage
reflects  an intent on the part of St. Paul to hold the  disputed
properties for the use of UMC:
          [S]aid  premises  shall be  held,  kept,  and
          maintained  as a place of residence  for  the
          use  and  occupancy of the ministers  of  The
          United Methodist Church, who may from time to
          time  be  entitled  to  occupy  the  same  by
          appointment,   and/or[]   used,   kept,   and
          maintained, as a place of divine  worship  of
          the United Methodist ministry and members  of
          The  United Methodist Church; subject to  the
          Discipline,     usage,    and     ministerial
          appointments of said church as from  time  to
          time  authorized and declared by the  General
          Conference  of  said church, and  the  Annual
          Conference  within  whose  bounds  the   said
          premises are situated[.]
          
          2.   The  purchase of the disputed properties after the
               affiliation with UMC is not fatal to a finding  of
               a trust.
               
          St.  Paul notes that under trust law, the lack  of  the
requisite  trust  property or res when the trust  is  purportedly
created is fatal to the formation of an express trust.  Since St.
Paul did not have legal title to the disputed properties when  it
incorporated or became a member of UMC, it argues,  no  trust  in
favor  of  UMC  could  have  been created.   In  support  of  its
argument, St. Paul cites the Restatement (Second) of Trusts which
provides in part:
          A  trust cannot be created . . . unless there
          is    trust   property   in   existence   and
          ascertainable at the time of the creation  of
          the  trust.  In the absence of such  property
          there  is  at most an agreement to  create  a
          trust,  and  whether  such  an  agreement  is
          binding  as  a contract depends upon  whether
          the  requirements  for  the  creation  of   a
          contract are satisfied.[46]
          
          The  absence  of  a  res does not prove  fatal  to  the
imposition  of a trust, however, because it is not  necessary  to
isolate  St. Pauls manifestation of intent to create a  trust  to
the  narrow  window of time in which St. Paul was  organized  and
affiliated with UMC.  The default trust clause in the Discipline,
which states that intent sufficient to create a trust in favor of
UMC can be shown through the use of the name, customs, and polity
of  The  United Methodist Church or any predecessor to The United
Methodist  Church  in  such a way as to  be  thus  known  to  the
community as a part of such denomination,47 suggests that  intent
to  create  a  trust  can be inferred from  St.  Pauls  continued
affiliation  with UMC after it purchased the disputed properties.
The Restatement (Third) of Trusts lends support to our conclusion
when explaining that in a scenario in which a person gratuitously
purports to declare a trust, or to make a transfer to another  in
trust, of a bare expectancy or nonexistent property:
          No   trust  arises  when  the  person   later
          acquires the intended trust property  in  the
          absence    of   some   express   or   implied
          manifestation at the later time of an  intent
          to give effect to the trust.[48]
          
The  deeds to the disputed properties themselves, which lack  the
trust  language urged by the Discipline, manifest the  intent  of
St.  Paul to establish a trust in favor of UMC because the  deeds
are   in   the   name  of  St.  Paul  United  Methodist   Church.
Additionally, St. Paul continued its affiliation with  UMC  after
the  purchase  of  the  disputed properties  in  1988  until  the
discontinuation in 2002, further demonstrating a  willingness  to
be  bound  by the trust provisions of the Discipline.   The  fact
that there was no res when St. Paul initially affiliated with UMC
is therefore not dispositive.
          3.   The statute of frauds is not implicated.
          St.  Paul argues that under Alaskas statute of  frauds,
an  agreement to establish a trust is unenforceable unless it  or
some note of it is in writing and subscribed by the party charged
or  by  an  agent  of that party.49  AMC refers to  the  multiple
indicia  of  intent by St. Paul to affiliate with  UMC,  many  of
which  are reflected in writings subscribed to by members of  St.
Paul,  including:   (1) St. Pauls request to join  UMC,  (2)  its
Certificate  of  Organization, (3)  the   St.  Paul  Constituting
Church  Conference  Register of Attendance,  (4)  the  Report  of
Pastors, (5) the name St. Paul United Methodist Church,  (6)  the
Certificate  of  Religious Corporation issued  by  the  State  of
Alaska  to St. Paul, and (7) St. Pauls Articles of Incorporation,
including the name St. Paul United Method Church.  These writings
are  sufficient evidence of intent to form a trust to satisfy the
statute of frauds.
     D.   The  Trust  Was Not Revoked when St. Paul  Amended  Its
          Articles of Incorporation.
          
          St. Paul argues that, even if a trust existed, St. Paul
revoked  the  trust when it amended its Articles of Incorporation
and  deleted any reference to UMC and the Discipline.  In support
of  its argument, St. Paul refers to AS 10.40.050, which provides
that [a] corporation formed under this chapter may alter or amend
its articles of incorporation and change its seal.  St. Paul also
relies   upon  California-Nevada  Annual  Conference  of   United
Methodist Church v. St. Lukes United Methodist Church50  for  the
proposition that amending its articles had the effect of revoking
the trust.
          In  St.  Lukes,  a California appellate court  applying
neutral  principles  upheld a trial courts determination  that  a
trust  was  created in favor of UMC.51  But the California  court
found  that St. Lukes had subsequently revoked the trust in favor
of UMC when it amended its articles of incorporation as permitted
by  the applicable provisions of the California Corporations Code
pertaining  to  religious corporations.52 The court  made  clear,
though,  that  its  decision was based upon  the  presumption  in
California  law that unless a trust is expressly made irrevocable
by the trust instrument, the trust is revocable by the settlor.53
          St.  Lukes  is  distinguishable  because  the  opposite
presumption  applied under Alaska law in 1988, when the  disputed
properties were acquired and St. Pauls intent to create  a  trust
was  manifested  through  the use of the  name  St.  Paul  United
Methodist   Church  on  the  deeds  and  through  its   continued
affiliation with UMC.  This court noted in Alaska State Employees
Association v. Alaska Public Employees Association that  [t]rusts
may  be modified to the extent that the settlor of the trust  has
          reserved the power of modification.54  While St. Paul is correct
that   religious  corporations  may  amend  their   articles   of
incorporation  under Alaska statute, St. Paul  has  presented  no
evidence  to  suggest that it reserved the right  to  revoke  the
trust  and  therefore  was entitled to do so  by  amendment.   We
therefore conclude that St. Paul did not revoke the trust.
          St.  Paul raised in passing before the trial court, but
not  through  this appeal, the question whether AS  13.36.338(a),
which  was  enacted in 2000 and provides that unless a  trust  is
expressly  made irrevocable, a trust executed on or after  August
30,  2000 is revocable by the settlor, enables St. Paul to revoke
any  trust  that existed.  Since we conclude that  the  trust  in
favor  of  UMC  was created in 1988 when Alaska law presumed  the
reverse, we deem AS 13.36.338(a) to be inapplicable.  But we note
that under different facts, we, like the California court in  St.
Lukes, might determine that in accordance with AS 13.36.338(a)  a
trust  created by a local church in favor of a parent  church  is
revocable.
     E.   No Joint Trust Was Created.
          St.  Paul  argues that the lower court  also  erred  in
implicitly  holding that a trust existed only in favor  of  [UMC]
and  contends that the Discipline creates at most a  joint  trust
between  the  AMC  and St. Paul, Inc.  As the foundation  of  its
argument,  St.  Paul  cites  Paragraph  2537  of  The   Book   of
Discipline, which states:
          Incorporated Local Church Property-Title  and
          Purchase:
          
          . . . .
          
          the  title  to  all  property  now  owned  or
          hereafter  acquired by an incorporated  local
          church . . . shall be held by and/or conveyed
          to  the corporate body in its corporate name,
          in  trust  for  the use and benefit  of  such
          local  church  and  of The  United  Methodist
          Church.[55]
          
St. Paul emphasizes the language in trust for the use and benefit
of  such  local church and The United Methodist Church  to  argue
that, if a trust exists, it is a joint trust.
          If  this  paragraph  were read in isolation,  it  could
perhaps  lend  support to St. Pauls argument.  But under  neutral
principles,  we consider the language of Paragraph  2537  of  the
Discipline  in context, not in isolation, just as we  would  when
interpreting a contract56 or a statute.57
          Immediately following the language quoted by  St.  Paul
Church, Paragraph 2537 incorporates by reference Paragraph  2503,
when  it  states  that [e]very instrument of conveyance  of  real
estate shall contain the appropriate trust clause as set forth in
the Discipline ( 2503).  Paragraph 2503 provides:
          [A]ll  written  instruments of conveyance  by
          which premises are held or hereafter acquired
          for use as a place of divine worship or other
          activities   for  members   of   The   United
          Methodist  Church shall contain the following
          trust clause:
          
          In  trust, that said premises shall be  used,
          kept,  and  maintained as a place  of  divine
          worship of the United Methodist ministry  and
          members   of  The  United  Methodist  Church;
          subject  to  the Discipline  .  .  .  .  This
          provision  is solely for the benefit  of  the
          grantee, and the grantor reserves no right or
          interest in said premises.[58]
          
Read  as  a  whole  along  with  the paragraph  it  incorporates,
Paragraph 2537 undermines rather than supports St. Pauls argument
that  the parties intended for the disputed properties to be held
in  joint  trust.  Paragraph 2501, which sets forth UMCs  general
understanding about its connectional structure, also  contradicts
St.  Pauls argument, when it states that titles to all  real  and
personal, tangible and intangible property . . . shall be held in
trust for [UMC] and subject to the terms of the Discipline.59  We
therefore  reject  St. Pauls argument that the trust  created  in
favor of UMC was a joint trust.
     F.   The   Superior  Court  Did  Not  Err  in  Finding   the
          Individually  Named  Appellants Personally  Liable  for
          Conversion and Trespass.
          
          On  June  23,  2004,  the  superior  court  heard  oral
argument  and  issued  a  written  order  determining  that   the
individually  named  appellants  were  liable  for  trespass  and
conversion.   St.  Paul  appeals, arguing that  summary  judgment
relieving  plaintiffs from personal liability  should  have  been
granted.   St.  Paul claims that there was no evidence  that  any
individual  personally committed any acts to constitute  trespass
or  conversion.   If  the superior courts decision  is  based  on
individual  acts,  St. Paul argues, there is no  support  in  the
record to establish which individuals actually changed the locks,
entered  onto  and  possessed  the disputed  property,  and  took
personal property.  However, St. Paul admits in its briefing even
before this court that St. Paul regained control of its parsonage
and  church buildings, and resumed regular worship in the church.
Additionally,  the individually named appellants admit  in  their
answer  that  they  entered  the parsonage  against  the  express
written  objection  of  AMC  and that they  entered  the  church,
changed the locks, and have begun having services there.
          Trespass  is  defined as an unauthorized  intrusion  or
invasion of anothers land.60  An intentional entry onto the  land
of   another  constitutes  intentional  trespass  even   if   the
trespasser  believes that he or she has the right to  be  on  the
land.61  To establish a conversion claim, a plaintiff must  prove
that  it  had  a  possessory interest in the property,  that  the
defendants   intentionally   interfered   with   the   plaintiffs
possession, and that the defendants acts were the legal cause  of
the plaintiffs loss of property.62
          With respect to the trespass and conversion claims  the
superior court found:
          [G]ood faith may go and certainly does go  to
          issues  of  damages  that have  been  raised.
          However, the individual defendants are liable
          for  conversion, are liable  for  any  damage
          done  to  property or the property  that  has
          been converted and unrecovered.
          
          Whether they did so as fiduciaries or out  of
          their  belief  in  a fiduciary  duty  to  the
          amended  entity, St. Paul Church,  is  not  a
          matter before the Court, but rather one  that
          may  go  to the corporate desire to indemnify
          or reimburse for any damages or expenses, but
          the individuals that withheld property, broke
          locks, and did those things, are liable.  And
          they are liable as of the time of their acts,
          not  when the determination of ownership  was
          made.
          
Because the   individually  named  appellants  admitted  entering
          property and removing locks from property belonging  to
          AMC,  and  a claim of right to the property  is  not  a
          defense  to either trespass or conversion, the superior
          court  did  not  err in finding the individually  named
          appellants  liable, subject to a determination  of  the
          extent  of  damages.       G.   The Superior Court  Did
          Not  Err  in Granting Control of the St. Paul Corporate
          Entity and Name to St. Paul.
          
          In  its  memorandum decision dated April 8,  2004,  the
superior  court, after determining that the Discipline  expressly
requires local churches to hold property in trust for the general
church,  awarded the disputed church and parsonage  to  AMC.   It
also  found that title was quieted in the name of St.  Paul,  and
ruled that AMC could be substituted as the legal title owner.  On
June  23,  2004, however, the superior court reached a  different
result with respect to the question of St. Pauls corporate  name.
Through its cross-appeal, AMC challenges the superior courts oral
order  granting St. Paul control of the St. Paul corporate entity
and the name St. Paul.
          As  a preliminary matter, we address AMCs argument that
the individually named appellants lack standing to assert a claim
for the St. Paul corporate entity and name.  AMC moved to dismiss
the  answer  and  the  counterclaims of  the  individually  named
appellants  for  lack of standing on April  22,  2004.   At  oral
argument on June 23, 2004, Superior Court Judge Richard D. Savell
noted  that he was confused about the motion because it  appeared
from the pleadings that the individually named appellants had not
raised  any counterclaims.  According to the responsive pleadings
to   the  original  complaint  and  the  amended  complaint,  the
counterclaim  against AMC for theft was in fact only  brought  in
the  name  of  St.  Paul  Church, Inc.,  f/k/a  St.  Paul  United
Methodist Church.  The following exchange took place between  the
superior court and AMCs counsel at oral argument on this issue:
          Mr.  Sheehan:   If  there are  no  individual
          claims, then they have no standing to  assert
          I  mean, one of the issues that was raised in
          the motion was whether they have standing  to
          assert a claim on behalf of St. Paul.
          
          The Court:  All right.  They havent made one.
          So  I  dont care if they have standing.   The
          church has counterclaimed for conversion, and
          Im  prepared to address that as part  of  the
          whole package.
          
          Mr. Sheehan: Okay.

No  further  argument in favor of the motion  was  made,  and  on
August  2, 2004, the superior court issued an order denying  AMCs
motion.
          AMC  appeals, asking that the superior courts June  23,
2004  oral  ruling be vacated.  AMC makes the argument  that  the
individually named appellants are only five of sixty-two  members
of the congregation of St. Paul and as such a minority, they have
no  standing to represent St. Paul, amend its Articles, and claim
the St. Paul corporate entity and name.  AMC has not addressed in
its  appeal the fatal flaw identified by the superior court  that
the  individually  named  appellants  are  not  parties  to  this
litigation as claimants.63  Instead, they were brought into  this
litigation in their individual capacities solely to defend claims
brought by AMC.
          Further,  it is clear from the motion of St.  Paul  for
summary  judgment, which resulted in the award of  the  St.  Paul
name  and  corporate  existence to St. Paul, that  the  corporate
entity  was claiming legal title to the disputed property on  its
own  behalf,  and the individually named appellants only  offered
defenses  to  personal liability.  While some of the individually
named  appellants are also officers of the corporation,  it  does
not follow that they were making claims to the name and corporate
existence  of  St. Paul on their own behalf.  The superior  court
therefore  did not err when it denied AMCs motion to dismiss  for
lack  of standing because the individually named appellants  were
in fact asserting no claims.
          Finding AMCs jurisdictional arguments unpersuasive,  we
turn  to  the  substance  of the superior courts  order  granting
control  of the St. Paul corporate entity and name to  St.  Paul.
In  its  decision,  the  superior  court  reasoned  that  it  was
responsible for [St. Paul] to amend the documents by  which  they
continued their association, affiliation and worship.   The  name
St.  Paul Church is not one that belongs to the Alaska Missionary
Conference.   St. Paul United Methodist Church does.   They  have
abandoned that . . . and . . . their corporate status, is not, in
view  of  this  change . . . something they will be divested  of.
The superior court further explained that
          the corporate entity is the legal recognition
          of  the  name, and they changed that, and  in
          effect,  by  changing it . .  .  changed  the
          character  of  it  so that  it  was  not  the
          property  of  The  United  Methodist   Church
          because  it  is  not that  which  formed  the
          relationship  and was part of  the  documents
          and the . . . affiliation.
          
          And  the  interest  of the  United  Methodist
          Church  in having nonaffiliated churches  use
          the name Methodists is preserved.  Anyone can
          name  their church after any saint they wish,
          and they have done so here.
          
          The  superior  courts  conclusion  that  there  is   an
analytical  distinction  between the corporation  as  a  separate
legal entity and the religious society which may bind itself to a
hierarchical  organization is both persuasive  and  supported  by
authority.  According to American Jurisprudence
          [a]  church  society, by incorporating,  does
          not  lose  its  existence  or  become  wholly
          merged  in  the  corporation.  The  religious
          corporation and the church, although one  may
          exist within the pale of the other, are in no
          respect   correlative.    The   objects   and
          interest  of the one are moral and spiritual;
          the   other  deals  exclusively  with  things
          temporal  and material.  Each as  a  body  is
          entirely independent and free from any direct
          control or interference from the other.[64]
          
In  a  situation such as that before this court,  where  a  local
church   is   involuntarily   disassociated   from   a   national
denomination, the equities and neutral principles  of  law  favor
respecting the integrity of the separate legal existence  of  the
corporation.   Therefore, we affirm the decision of the  superior
court  awarding the St. Paul corporate existence and name to  St.
Paul.
          AMC  argues that since the Discipline provides that all
properties, tangible and intangible, be held in trust for  UMC,65
and  under  the Discipline discontinuance places all of  a  local
churchs  properties  under the control of the  annual  conference
trustees,66  AMC is entitled to St. Pauls personal property,  its
corporate  existence, and its intangible property, and  its  name
St.  Paul  United Methodist Church, Inc.  AMC, however, cites  no
case  law  to  support its position and relies instead  upon  the
provisions  of  the  religious corporation statute  and  its  own
interpretation of its authority under the Discipline  to  succeed
to the office of corporation sole67 under AS 10.40.110.68  Because
we find that under neutral principles, St. Paul exists as a legal
entity  independent of its affiliation with UMC, we need not  and
would  not delve into the matters of power allocation within  UMC
implicated by AMCs argument.69
IV.  CONCLUSION
          We  adopt  the neutral-principles approach to resolving
property   disputes  among  religious  organizations.    Applying
neutral principles, we agree with the superior court that a trust
was created by St. Paul in favor of UMC, and therefore AFFIRM.
          Because the individually named appellants have admitted
          acts that would establish trespass and conversion, we AFFIRM the
superior courts conclusion that they are liable.  We also  AFFIRM
the  superior  courts order denying AMCs motion  to  dismiss  the
claims  because  the  individually  named  appellants  have   not
asserted  any  claims.  Finally, we AFFIRM  the  superior  courts
decision  that St. Paul is entitled to maintain its own name  and
corporate existence.
_______________________________
     1     Book  of  Discipline  of the United  Methodist  Church
(Harriet Jane Olson et al. eds., 2000).

     2    Id. at 23-35,  7-43.

     3    Id., ch. 6.

     4    Id. at 649,  2501.

     5    Id. at 649-50,  2503(2)-(3).

     6    Id. at 651,  2503(6).

     7    Id. at 652,  2506.

     8    Id. at 680,  2548(2).

     9    Id. at 680-81,  2548(3).

     10    Gary Koll was dismissed as a party to the litigation by
stipulation on January 26, 2004.

     11      Alaska  Legislative Council  ex  rel.  Alaska  State
Legislature v. Knowles, 86 P.3d 891, 893 (Alaska 2004).

     12    Rausch v. Devine, 80 P.3d 733, 737 (Alaska 2003).

     13    Guin v. Ha, 591 P.2d 1281, 1284 n.1 (Alaska 1979).

     14    McElroy v. Kennedy, 74 P.3d 903, 906 (Alaska 2003).

     15    K & K Recycling, Inc. v. Alaska Gold Co., 80 P.3d 702,
711 (Alaska 2003).

     16     Fairbanks Fire Fighters Assn, Local 1324 v.  City  of
Fairbanks, 48 P.3d 1165, 1167 (Alaska 2002).

     17     Far  North  Sanitation, Inc. v. Alaska Public  Utils.
Commn, 825 P.2d 867, 869 n.2 (Alaska 1992).

     18    80 U.S. 679 (1871).

     19    Watson, 80 U.S. at 727.

     20     See,  e.g., Gonzalez v. Roman Catholic Archbishop  of
Manila, 280 U.S. 1, 14 (1929).

     21    393 U.S. 440 (1969).

     22    Id. at 442.

     23    Id. at 443.

     24    Id.

     25    Id. at 443-44.

     26    Id. at 450.

     27    Id. at 449.

     28    Maryland & Virginia Eldership of the Churches of God v.
Church of God of Sharpsburg, 396 U.S. 367, 368 (1970).

     29    Id.

     30     Id. at 370 (quotations and citations omitted).  As  a
third  alternative, he suggested that states pass  special  state
statutes governing church property arrangements in a manner  that
precludes  state  interference  in  doctrine.   Id.   Alaska  has
adopted no such statutes.

     31    443 U.S. 595, 596 (1979).

     32    Id. at 603.

     33    Jones, 443 U.S. at 605-06 (citations omitted).

     34    489 A.2d 1317 (Pa. 1985).

     35    Id. at 1321-22.

     36    Id. at 1322 n.4.

     37    845 P.2d 424, 427 (Alaska 1993).

     38    Id. at 428.

     39    McAdoo v. Diaz, 884 P.2d 1385 (Alaska 1994).

     40    Jones, 443 U.S. at 600-01.

     41    Discipline 651,  2503(6)(b).

     42     See, e.g., United Airlines, Inc. v. Good Taste, Inc.,
982  P.2d 1259 (Alaska 1999) (applying Illinois law when contract
provided  that  disputes  would  be  governed  by  the  laws   of
Illinois).

     43    443 U.S. at 603-04.

     44    Sugg v. Morris, 392 P.2d 313, 316 (Alaska 1964).

     45    Discipline 651,  2503(6).

     46    Restatement (Second) of Trusts  2 cmt. k (1959).

     47    Discipline 651,  2503(6).

     48    Restatement (Third) of Trusts  41, cmt. d (2003).

     49    AS 09.25.010(a)(9).

     50    17 Cal. Rptr. 3d 442, 445 (Cal. App. 2004).

     51    Id.

     52    Id. at 452.

     53    Id. at 453.

     54     825  P.2d  451, 460 (Alaska 1991) (citing Restatement
(Second)  of  Trusts  331 (1959)); see also In re Last  Will  and
Testament  of  Tamplin,  48 P.3d 471,  473  (Alaska  2002)  (when
addressing  whether  a  will could revoke an  inter  vivos  trust
created  in 1993, noting that a trust is revocable by the settlor
if  and  to the extent that by the terms of the trust he reserved
such power ).

     55    Discipline 670.

     56     Cf. Matanuska Elec. Assn, Inc. v. Chugach Elec. Assn,
Inc.,  99  P.3d  553,  562 (Alaska 2004) (The  goal  of  contract
interpretation  is  to  give  effect to  the  parties  reasonable
expectations,  which we assess by examining the language  of  the
disputed  provisions, the language of other provisions,  relevant
extrinsic evidence, and case law interpreting similar provisions.
In reaching a reasonable interpretation of a contract, we attempt
to  give  effect to all of its terms, if possible.   We  consider
disputed  language within the context of the whole  contract  and
its  purposes, and the circumstances surrounding its  formation.)
(internal citations omitted).

     57    Cf. Bradford v. First Nat. Bank of Anchorage, 932 P.2d
256,  262  (Alaska  1997)  (this court interprets  each  part  or
section of a statute with every other part or section, so  as  to
create a harmonious whole ) (citations omitted).

     58    Discipline 649-50.

     59    Discipline 649.

     60    Mapco Express, Inc. v. Faulk, 24 P.3d 531, 539 (Alaska
2001)  (citing Parks Hiway Enters., L.L.C. v. CEM Leasing,  Inc.,
995  P.2d  657, 664 (Alaska 2000); Restatement (Second) of  Torts
158, 163 (1965)).

     61    Brown Jug, Inc. v. Intl Bhd. of Teamsters, Chauffeurs,
Warehousemen & Helpers of America, Local 959, 688 P.2d  932,  938
(Alaska 1984) (citing Restatement (Second) of Torts  164 (1965)).

     62    K & K Recycling, 80 P.3d at 717.
     63     For  this reason alone, we would affirm the  superior
court.   See  Peterson v. Mutual Life Ins. Co. of New  York,  803
P.2d  406,  411 n.8 (Alaska 1990) (finding that an  argument  was
waived where appellant failed to advance any legal argument as to
why the court erred).

     64    66 Am. Jur. 2d, Religious Societies  5 (2005).

     65    Discipline 649,  2501.

     66    Id.

     67    AS 10.40.060 provides:

               Upon  the  filing  of  the  articles  of
          incorporation   for   record    the    person
          subscribing  the articles and a successor  in
          office by the name or title specified in  the
          articles   is   a  corporation   sole,   with
          continual perpetual succession.
          
     68     AS 10.40.110 addresses succession to property when  a
corporate sole is removed, providing in relevant part:

               In the event of the death or resignation
          of the archbishop, bishop, president, trustee
          in  trust,  president of stake, president  of
          congregation, overseer, presiding  elder,  or
          member  of  the  clergy,  who  has  formed  a
          corporation  under this chapter,  or  such  a
          persons removal from office by the person  or
          body  having removal authority, the successor
          in  office as the corporation sole is  vested
          with  the title of all property held  by  the
          successors  predecessor with the  same  power
          and  authority over the property, subject  to
          all  the  legal  liabilities and  obligations
          with reference to the property.
          
(Emphasis added.)

     69     See,  e.g.,  Maryland  & Virginia  Eldership  of  the
Churches of God v. Church of God of Sharpsburg, 396 U.S. 367, 369
(1970)  (Under  Watson civil courts do not  inquire  whether  the
relevant church governing body has power under religious  law  to
control  the property in question.  Such a determination,  unlike
the identification of the governing body, frequently necessitates
the  interpretation of ambiguous religious  law  and  usage.   To
permit civil courts to probe deeply enough into the allocation of
power  within  a church as to decide where religious  law  places
control  over the use of church property would violate the  First
Amendment  in  much  the  same manner as civil  determination  of
religious doctrine.).

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