Opinion
August 20, 1957
Raphael H. Weissman for plaintiffs.
Milbank, Tweed, Hope Hadley for Chase Manhattan Bank, defendant.
Simpson, Thacher Bartlett for Manufacturers Trust Company, defendant.
Hubbell Davis for individual defendants.
This is a motion for a stay and other relief in an action that is one of several suits arising out of the embroilment in which the members of the Church of the Holy Trinity find themselves with respect to who is their spiritual leader.
On March 5, 1956 Herman S. Sidener was installed by the Diocesan Bishop as the rector of that church on the basis of resolutions adopted by the vestry of said church in February, 1956 electing him to such position. Before these resolutions were adopted, the rectorship of the parish had been vacant; and, by a resolution of the vestry dated March 19, 1951, William Howard Melish was employed as an assistant minister to conduct religious services until the election and installation of a rector, at which time his employment was to terminate. Notwithstanding the installation aforesaid, Melish, supported by three members of the vestry, took the position that the resolutions electing Sidener were invalid, and that by reason thereof his employment as assistant minister had not been terminated; and, accordingly, he continued to conduct the religious services of the parish.
Sidener thereupon brought action against Melish and his adherent vestrymen to obtain a judgment declaring the rights of the parties and granting injunctive relief. Pending the trial of that action an application was made before Mr. Justice BAKER for a temporary injunction restraining the defendants therein from entering upon the church property or in any way attempting to conduct religious services or exercise any dominion or control over said church or its property. This motion was denied upon the ground that Sidener's election as rector was invalid inasmuch as the meeting whereat said election took place lacked a quorum as required by section 42 of the Religious Corporation Law ( 1 Misc.2d 933); and on appeal taken to the Appellate Division, said order was affirmed, but solely on the ground that the aforesaid denial was not an abuse of discretion ( 1 A.D.2d 978).
Thereafter the action was tried before Honorable JOHN MacCRATE, Official Referee, and he too decided in favor of the defendants on the ground that the meeting at which Sidener was elected lacked a quorum ( 3 Misc.2d 997); and in the judgment entered on his decision on September 25, 1956 it was adjudged that plaintiff Sidener was not lawfully elected rector of said church and that Melish continued as assistant minister thereof until the election of a rector shall have taken place. Immediately following the entry of this judgment Sidener appealed therefrom to the Appellate Division of this department. ( 4 A.D.2d 256.)
On October 11, 1956 the instant action was instituted in the corporate name of said church by pro-Melish vestrymen against Manufacturers Trust Company, the Chase Manhattan Bank, and Lewis G. Reynolds, Anson W. Wright, J. Royal Rutledge, Albert J. Borthwick, Joseph J. Pepenella, Leroy Peterson and William F. Kluss, the individual defendants named being pro-Sidener vestrymen. In the complaint herein it is alleged that plaintiff church has moneys and securities on deposit in defendant banks exceeding the sum and value of $400,000 and that said property is subject to disposition by written order of said plaintiff's authorized officers; that on or about April 5, 1956 plaintiff church filed with each defendant bank a resolution passed by said plaintiff's vestry on April 4, 1956 authorizing the disposition of said money and securities on plaintiff's behalf, by written orders on each defendant bank, signed by any two of three officers of plaintiff church therein designated; and that said defendant banks refused to honor plaintiff's resolution claiming that the individual defendants named in said action have some right, title, interest or authority in and to said property, individually or in some capacity representative of the church; and that said individual defendants have no such rights or power or authority therein in any capacity and that plaintiff demands judgment declaring that the resolution filed with each bank and the authority thereby vested in plaintiff's officers are valid and binding on each defendant bank respectively and that the individual defendants have no right, title, interest, power or authority in the premises either individually or in any capacity representative of the church. The resolutions referred to in said complaint disclose that Cameron Beadle, E. DeWitt Ramel and Alexander Ector Orr Munsel, respectively, churchwarden, clerk of the vestry and treasurer of the church, are designated as the officers authorized to draw the afore-mentioned funds. These designees are Melish partisans. Prior to April 4, 1956 the funds of the parish were under the jurisdiction and control of defendants Reynolds, Rutledge and Wright, as vestrymen of said church, under resolutions of the vestry adopted October 5, 1955 and filed with the banks in question.
On April 2, 1956 the annual parish meeting was held for the purpose of filling vacancies existing in the vestry which had occurred by expiration of term or otherwise, and was presided over by defendant Reynolds, who was then senior warden. The pro-Sidener faction contends that this meeting was so loud and boisterous and unruly that a motion was duly made and carried adjourning same for 30 days; and the opposition thereto, on the other hand, not only denies that the meeting was unruly and that it was duly adjourned, but also contends that the parishoners thereat proceeded with the business for which they met and duly filled existing vacancies by electing Cameron Beadle, as churchwarden, and Harvey Cox, Alex Munsel, Chelsea Watson, Frederick Cleeland and Frank Decorato, as vestrymen. The officers allegedly elected are pro-Melish and by their election control of the vestry passed to Melish supporters, and the board thus constituted adopted the resolutions of April 4, filed as above stated with the banks.
Following the meeting aforesaid, defendant Reynolds, having been advised by the chancellor of the diocese that the elections of April 2 were illegal and ineffective, and that the old vestry continued to function until their successors were legally chosen, communicated this advice to the defendant banks and requested that all accounts be frozen pending legal clarification; and on the basis thereof said banks refused to honor the resolutions referred to in the complaint.
The Chase Manhattan Bank in its answer claimed that it had conflicting resolutions and would honor neither, it being ignorant of the respective rights of the parties mentioned in both resolutions; and it later interpleaded as defendants Beadle, Ramel and Munsel mentioned in the resolution of April 4 and in its complaint with respect thereto demanded judgment that the rights of said interpleaded defendants, as well as those of the defendants Wright, Rutledge and Reynolds, the vestrymen mentioned in the resolution of October 5, 1955, be determined and that it be authorized to pay into court the securities and cash or make such other disposition as is permitted by law and directed by the court. On January 23, 1957 said bank moved for an order pursuant to subdivision 7 of section 285 of the Civil Practice Act permitting it to pay into court the amount of the credit balance and the securities and cash held by it standing in the name of plaintiff church and said motion was granted, and on February 18, 1957 an order was signed by Mr. Justice HART permitting the Chase Manhattan Bank to transfer the money and securities which are the subject of this action to a custody account in the name of plaintiff, to be retained to the credit of the action subject to further order of the court.
The individual defendants in their answer herein alleged that the vestry on April 4, 1956 was comprised of Dr. Sidener and the seven individual defendants and E. DeWitt Ramel, Philip Brook and John H. Burke and that said vestry at no time authorized the institution of the action, and otherwise denied generally the allegations of the complaint.
The argument on the appeal from the judgment directed by Official Referee MacCRATE was heard in February, 1957; and inasmuch as said appeal remained undetermined and the instant action was scheduled to be tried in March, 1957 at Special Term, Part III, the individual defendants on March 4, 1957 moved before me in that part for an order staying all proceedings in said action pending the determination of the appeal from the judgment in the Sidener case, they claiming that a favorable determination of said appeal would invalidate the elections of April 2 and consequently render ineffectual the resolution of April 4. The pro-Melish vestrymen opposed this move on the ground that the Sidener appeal could have no possible effect upon the validity of the resolution of April 4 and moreover that an immediate trial would resolve whatever issues were raised in the action; and it was further urged by them that an adjournment of the trial would work a substantial hardship since the church had to resort to its deposits to pay outstanding bills and to carry on, and that Dr. John Howard Melish, who was paid a regular severance allowance under the Bishop's judgment of 1949 had not been paid since September of 1956; and that defendant William Howard Melish, who had been adjudged to be the minister in charge of the church by reason of two determinations, likewise had not been paid since October 6, 1956 and that there were divers sums of money due for insurance, oil and diocesan purposes, all of which totaled more than $9,000.
Relative to said motion I indicated at the time of the argument thereof, that I was inclined to grant it and, in order to ameliorate any hardships that might result with respect to matters not in any way affected by the determination of the Sidener appeal, I suggested that funds be withdrawn to pay for current expenses or any other proper obligation, excluding, however, the payment of any salary to William Howard Melish, by having one officer from each faction sign orders on the banks therefor. The attorney for the Melish group refused to go along with this suggestion, claiming that it could not succeed inasmuch as the pro-Sidener vestrymen would not co-operate. Confronted with this impasse, I granted the motion in question but provided in my decision thereof that the order to be entered could provide, if the parties consented thereto, for the payment of current expenses, excluding, however, any payments to William Howard Melish, by checks bearing the signatures of one from each group of the designees named in the afore-mentioned two resolutions. The Melish faction eventually agreed to go along with my suggestion and on March 22, 1957 I signed an order staying the trial of the action until 10 days after publication in the New York Law Journal of the decision of the Appellate Division and providing that during the pendency of the action defendant banks shall make payments from funds held by them against written orders signed by any one of the three designees shown on the resolution of April 4, 1956 and by any one of the three designees shown on the resolution of October 5, 1955; and said order further provided that any party thereto shall have leave to apply to me for any further relief in respect of the matters embraced by said order.
On June 24, 1957 the Appellate Division reversed the judgment of Official Referee MacCRATE ( 4 A.D.2d 256) and thereafter and on June 27, 1957 there was entered in this court, by reason of said order of reversal, a judgment adjudging that plaintiff Sidener was duly elected and installed as rector of the church and that defendant William Howard Melish's employment as assistant minister of the church had been terminated, and restraining the defendants named in said action from interfering in any way with plaintiff Sidener's control of worship at the church or of his use and control of the church and parish buildings.
On July 2, 1957 defendant Melish moved in the Court of Appeals for a stay of the aforesaid judgment of June 27 pending the argument of an appeal therefrom taken to that court. Said court, noting that the respondents had agreed in open court that the occupancy of the rectory by Dr. Melish and his family would not be disturbed pending the determination of the appeal, denied the motion for the stay and set the case down for argument during the first week of October, 1957. ( 3 N.Y.2d 885.)
See, also, 3 N.Y.2d 476, decided Dec. 5, 1957, affg. 4 A.D.2d 256. — [REP.
On the strength of the reversal in the Appellate Division and the denial of a stay of the judgment entered as a result thereof and also on the basis of the last provision in my order of March 22 granting leave to any of the parties to apply for further relief, defendants herein move now that the trial of this action be stayed until after the Court of Appeals rules upon the Melish appeal; and that during the pendency of the action defendant banks make payments from funds for the account of the church in accordance with the resolution of October 5, 1955 and that the salary of Dr. Sidener, from March 1, 1956 to June 30, 1957 in the amount of $9,333.44 be paid and $583.34 thereafter monthly beginning with July 1, and also unpaid car and travel allowance for the same period in the amount of $480 and beginning July 1, $30 per month for that purpose and also unpaid allowance for housing accommodations for the same period, in the amount of $2,160 and $135 per month for that purpose beginning July 1. Movants claim on this application that the impleaded defendant Alex Munsel, since March, 1956, has been depositing the proceeds of certain collections and other parish contributions in a separate account in his name, as treasurer, and has made payment therefrom to William Howard Melish for salary and has made no accounting for such funds to the diocese as required by its canons. This allegation has not been denied and I might add, by way of passing, that the order of March 22 solely affects deposits and securities with defendant banks and in nowise operates with respect to current collections or contributions not deposited in the church accounts with said banks.
The Melish vestrymen consent to granting the stay, but otherwise oppose the other relief sought and further move for cross-relief, namely, directing payment of current expenses in accordance with the order of March 22, which they claim are not being paid since the opposing group, after the determination of the Appellate Division, has refused to countersign checks as agreed to, they stressing that the failure to thus co-operate is violative of said provision which was to remain effective during the pendency of the action. Relative to the payment of salary claimed by Sidener, they urge that he is not morally entitled to same since he was engaged during the waiting period as chaplain of the Cathedral School of St. Paul in Garden City and, moreover, that his claim, therefore, is premature in view of the pending appeal. They also contend that I have no power to grant this relief.
Stay of the trial of this action is granted on consent but all other relief sought by defendants is denied on the ground that I lack authority to grant same on this application.
The relief thus denied was sought primarily on the basis of the provision in my order of March 22, 1957 granting to any party leave to apply to me for any further relief in respect of the matters embraced in said order. On the original motion defendants sought a stay of the trial and no other relief. Being empowered to grant the stay, I was likewise empowered to condition same on such terms as would ameliorate any condition resulting therefrom with respect to matters which could be considered neutral to both actions involving said church. Hence, I had the right to direct, as a condition of the stay, that operating expenses and other proper obligations be paid by checks drawn by two designees of one group or of the other. However, since the rights of the designees mentioned in the resolutions were being litigated, and not wanting to exercise my discretion in such a manner as would indicate recognition of the rights of one set and not of the other, I proposed, as above stated a course conciliatory to both sides namely that, if the parties consented thereto, such expenses could be paid by orders therefor signed by one designee from each group. Mr. Weissman, attorney for the Melish vestrymen, consented eventually to go along with this suggestion, but, as hereinbefore mentioned, entertained misgivings as to the workability thereof, and, at his behest, and to secure compliance with the procedure indicated, I allowed said provision for granting leave for further relief. It was not intended thereby to retain continuing jurisdiction with respect to any phase of the case which might thereafter develop, but rather to reserve the power, in the event of noncompliance with said order, to circumscribe the operation of the stay or otherwise to condition same on different terms. In the light of the construction thus placed thereon, applicants have failed to present any facts empowering me to enlarge upon the order to the extent requested.
Assuming, arguendo, that said provision does encompass the instant application, I find, nevertheless, no showing of need for granting the relief in question. No temporary relief should be granted in a manner determining issues in litigation or indicating an opinion thereon unless a necessity therefor is shown. Consistent with this principle, I refused, on the original motion, to permit any payments to be made to William Howard Melish, notwithstanding that Judge BAKER and Judge MACCRATE had already held that Sidener had not been duly elected rector, feeling that since Melish's right thereto was being further litigated no hardship under the circumstances would result to him if required to await final and conclusive determination thereof. Sidener is placed in no better position than his adversary by reason of the reversal by the Appellate Division and the denial of a stay by the Court of Appeals. The denial of the stay does not necessarily portend what disposition will be made by that court. Were I to direct at this time that Sidener's salary be paid, I would thereby indicate that his right thereto is not still open to question and would thus be overlooking the fact that, while four Justices of the Appellate Division voted to uphold Sidener, one Justice thereof dissented and held that Sidener had not been duly elected rector and also that two other jurists have made similar rulings. Such diversity of opinions indicate that a close question of law is involved and discretion dictates that I refrain from revealing my opinion thereon in view of the immediacy of the argument to be had before the Court of Appeals. Sidener has already waited 16 months for his salary and will surely sustain no hardship by being required to wait several more months.
It has been alleged, and not denied, that the impleaded defendant Munsel, presently acting as treasurer of the church, has for some time deposited church funds in a bank account opened in his name as treasurer, and has made payments therefrom to Melish for salary. Such a situation cannot be availed of to the advantage of Sidener, since same does not in any way operate to the prejudice of his rights. Munsel must assume full responsibility for his conduct and, in the event that Sidener's claimed rights are finally established, must make personal reimbursement to the church for any payments made to Melish.
Although not necessary to consider on this application in view of the foregoing disposition, I do, nevertheless, wish to comment upon the tenuous claim advanced by the Melish group that it would be immoral for Sidener to seek his salary for the interim period since he was engaged as the chaplain for St. Paul's School in Garden City during that time. If Sidener's right to the rectorship is established, it is legal and entirely moral for him to seek his salary which rightfully belongs to him by virtue of said rectorship, notwithstanding that he was employed elsewhere.
Plaintiff's cross motion for relief is denied without prejudice inasmuch as the order of March 22 contains provision therefor and remains in operation during the pendency of this action. However, inasmuch as it appears that Dr. Sidener has closed down worship at the church, it becomes necessary for both sides to consider what expenses are presently proper in the light of that action. In the event the parties are unable to agree on same, a conference may be arranged with me for the purpose of deciding what obligations are to be met during the interim period.
Settle order on notice.