Reducing Your Church's Exposure to Legal Liability
A prudent man sees danger and takes refuge, but the simple keep going and suffer for it (Prov. 22:3; see Deut. 22:8).
Conflict Can Mean Legal Liability
When churches do not deal with conflict in a biblical and legally prudent manner, they may face a lawsuit for:
- Breach of contract
- Defamation (slander or libel)
- Intentional or negligent infliction of emotional distress
- Breach of fiduciary responsibility
- Invasion of privacy
- Negligent hiring, supervision, or retention of employees or volunteers
- Sexual harassment
- Wrongful discharge
Here are some hard facts about the legal system that should encourage you to take steps to protect your church from having to resolve a conflict through litigation.
1. The church is not immune to being sued. The First Amendment provides only limited protection: it gives us the freedom to believe what we want, but it does not give the freedom to take any and all action that we want. Courts generally do not allow churches or their leaders to hide behind the constitution to escape liability for certain acts, even if they are religiously motivated.
2. The doctrine of "charitable immunity" (where churches are immune to lawsuits) has been totally abandoned in most states and is of very limited scope in others.
3. The legal climate in the United States has changed dramatically in the past few decades. Forty years ago, actions against the church were usually for reinstatement; today they generally involve tort actions seeking large sums of money. As a general rule, courts today are much more willing to entertain actions against churches than they were even a decade ago.
4. American preoccupation with individualism, a diminished respect for authority, and the acceptance of relative morality has infiltrated the church. As a result, many people, including Christians, have a general antagonism toward concepts of accountability, responsibility, and discipline. This attitude is reflected in the following comments that were made by jurors in a recent lawsuit in which a church was held liable for damages because of the way it handled the excommunication of a member who refused to repent of adultery:
"How a person lives his private life is between that person and God, not between that person and the elders of the church. Let these elders tend to more critical matters of their church."
"I cannot believe four [church] officials . . . have anointed themselves and set about to pass judgment on one of their members. . . ."
"It doesn't matter if she was fornicating up and down the street. It doesn't give [the church] the right to stick their nose into it."
5. Exposure to suit will increase as courts extend "enterprise liability theory" to the church. This theory of law intentionally and directly spreads the cost of injuries to a single person across an entire organization, enterprise, or industry that is somehow related to the person's injury. Therefore, instead of one person suffering a lot, many persons suffer a little. Personal responsibility is replaced by industrial responsibility. This principle gives injured parties access to a "deep pocket."
6. A church can be sued for virtually any reason, even if in reality it has done nothing wrong or illegal. Once an action is filed against it, the church will be compelled to defend itself or lose by default judgment.
7. It often costs plaintiffs very little money to sue a church. Many, if not most, cases against churches are taken by attorneys on a "contingency fee" basis, meaning that the plaintiff pays no attorney fees unless he or she wins the case. Some attorneys will take cases that have very little likelihood of success if the case is likely to produce substantial publicity.
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8. The direct legal cost of defending against a lawsuit is usually at least $10,000 and can easily exceed $50,000. Legal defense costs are not paid on a contingency basis, but on a set hourly rate. Even if the church wins the lawsuit, it usually does not recover any of its legal costs.
9. Awards for actual damages can easily exceed $100,000, and $1,000,000 awards have become commonplace. Punitive damages awards can be even higher, and may be awarded when an intentional act caused an injury or when extreme carelessness contributed to it.
10. Lawsuits also cause major disruptions to a church, and usually demand a great deal of time, energy, and attention from key leaders, thus taking them away from important ministry responsibilities. Lawsuits can also attract damaging publicity and even divide a congregation when members take sides or disagree as to how the suit is being handled.
11. Insurance will not necessarily cover all of the costs and damages that may be imposed upon a church (e.g., sexual abuse of a child by a nursery worker).
In light of these facts, it is clearly not good enough to do things so well that you will merely prevail in a lawsuit; you must do them so well that you will prevent lawsuits from ever being filed.
Reducing the Risk of Legal Liability
There are a number of things that a church can do to dramatically reduce its exposure to destructive conflict and avoid legal liability. These steps include:
- Upgrade your bylaws and guidelines for church discipline so that you can live out your convictions of biblical church government and accountability without government interference.
- Require membership commitments that provide "informed consent" to church policies (When members have expressly consented to your policies and practices, it is extremely difficult for them to bring a lawsuit against you when you actually exercise those policies).
- Use conciliation clauses in your bylaws and all church contracts; these legally enforceable clauses require that subsequent conflicts or lawsuits be resolved through biblical mediation or arbitration rather than civil litigation.
- Adopt and follow a carefully designed policy for screening youth workers and reporting suspected child abuse.
- Use consent to counseling forms that inform counselees of your policies on confidentiality and church discipline, and create a binding commitment to resolve disputes within the church rather than a civil court.
Peacemaker Ministries' Managing Conflict in the Church materials are specifically designed to help church leaders carry out these and many other actions that will reduce their churches' exposure to destructive conflict. The seminar set includes 8 hours of audiotapes, a detailed 140-page study manual, and 80 pages of reproducible forms, policies, and bylaws, which are also included on a floppy diskette that allows immediate use in your church.
To evaluate this material, please click on the topics listed above to review sample documents that may be used to implement these action steps.
Risk Management Consulting Services
Peacemaker Ministries offers consulting services to assist churches and ministries in improving their conflict resolution abilities and reducing their exposure to legal liability. These services include special instruction on conflict resolution, reviewing church bylaws, and designing custom documents and policies to ensure that a church is able to live out its spiritual convictions without incurring unnecessary legal liability. For more information on our consulting services, please contact us at your convenience.
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