The facts
Inner House case considering a property dispute over Broadford Church and Manse on Skye between two factions of the Free Church of Scotland.  A Feu Charter in 1869 set out the terms of the trust in favour of Trustees for the “Congregation of the Body of Christians called the Free Church of Scotland in the Parish of Strath, Skye”.

In 2000 a split occurred when a substantial minority of the Church (the break aways) separated themselves from the rest of the Church (the majority) taking themselves outside the system of church government (although there was no difference between the factions on religious doctrine). The congregation at Broadford was divided and the majority brought an action for declarator that (amongst other things) the church and manse belonged to the majority rather than the break aways. They also sought a conclusion preventing the break aways from trespassing on and carrying out renovations to the manse

The decision
An extra division of the Inner House found in favour of the majority.  It was clear from the trust deed that membership of and participation in the institutional structures of the Free Church was an essential feature of the trust. Whilst the break aways claimed that, following the division in 2000, they continued to adhere to the law and practice of the Free Church, they did not claim to maintain the continuity of the Church government system nor did they seek to argue that they remained part of the system of church courts. Participation in and membership of the system of church courts was the decisive principle on which the Broadford property was held on trust and the arguments put forward by the break aways were consistent only with the view that they had withdrawn from the system of church courts existing prior to the division.

Some general principles
After reviewing the authorities, Lord Drummond Young highlighted a number of principles and factors which would be taken into account when considering property disputes within churches. He noted that property rights will always be dependent on the circumstances of the individual case and in particular the terms of the trust agreement under which the property is held but also considered the following:

Majority rule
The principle of majority rule (i.e. that property should simply go to the majority of the money contributors on any division) was prevalent in older decisions but was rejected in the judgement of Lord Eldon in the House of Lords in Craigdaillie v Aikman (1813). Lord Drummond Young also took the view majority rule is unsatisfactory:

 “In the first place, it is not clear who the majority are: are they the majority of the congregation, or the majority of the members (as against adherents) among that congregation, or the majority of the elders, or a majority of the money contributors? If the last of these, how are the contributions of the various contributors to be assessed? In the second place, and more importantly, the principle of majority rule would permit a bare majority of the congregation to effect a fundamental change in the doctrines taught in the church or the religious practices followed there.”

The distinction between church property and congregational property
There is an important distinction to be made between property which is to be held for the general governing body or ecclesiastical judiciary of the church in question (especially from the funds of parties other than the parties in the congregation) and property which is to be held in trust for a congregation and its members. Church property must be used for the benefit of those whom the Church acknowledge as part of the church. Congregational property is the property of the congregation alone and the governing body has no interest or power over the property.

Adherence to fundamental doctrine
The court must scrupulously respect the religious opinions of the parties involved in the litigation especially the differences of opinion which the parties consider important. Those who adhere to the principles on which the congregation was united will not forfeit the property merely because a majority has decided otherwise. In the event of a division, the property held for a congregation will go to the part of the congregation which adheres to the fundamental principles of the church as identified in the churches original documents.  Those fundamental principles:

“may take a number of forms. Particular doctrines may be important, but so too may be a system of church government, and so may adherence to specific structures of church government.”

Unsurprisingly, however, it seems that the most important principle is that the trust deed rules.

The full judgement is available from Scottish Courts here

All of our property and conveyancing case summaries are contained in the LKS Property and Conveyancing Casebook here.