COLORADO: Split congregation due in court Tuesday in property dispute

February 10, 2009

Opposing sides in a festering property dispute involving a landmark downtown Colorado Springs church faced off in an El Paso County district courtroom on February 10.

Judge Larry Schwartz is expected to hear opening arguments today and will be asked to decide whether those who leave the Episcopal Church (TEC) can keep church property. The Denver-based diocese and the Episcopal Church, which is also a party to the suit, believe a 1986 state Supreme Court decision favors them.

The Rev. Don Armstrong, rector of the 135-year-old Grace and St. Stephen's Episcopal Church, who in 2007 disaffiliated from TEC, believes "neutral principles of law will prove our corporation is the owner of the property and has always maintained its own right of affiliation.

"There is a huge emotional divide between Denver and southern Colorado," Armstrong said in a telephone interview on February 9, a day the church's website designated as one of prayer and fasting.

"The history of the congregation is tied up with the wild west and fierce spirit of independence here," said Armstrong, who says he and about half the 2,400-member congregation joined CANA, or the Convocation of Anglican Churches in America, a self-described "mission of the Anglican Church of Nigeria."

"The church started before the diocese," he said emphatically. "We've done all the mission work down here; we started all the churches here and have always maintained control through corporate statues. We believe we can leave the Episcopal Church and take our property." He has been rector since 1987.

But Beckett Stokes, diocesan communications director, said theological differences were just one of "two separate issues prior to the church leaving that were sort of related in time." Allegations that Armstrong mishandled more than $1 million in church funds were investigated by a diocesan ecclesiastical court "and the day the standing committee was to issue the presentment against him for the misconduct was the day he joined the CANA group," Stokes said.

Architecturally and socially, the Gothic-style church has served as a southern Colorado icon for more than a century. Senior warden Lynn Olney is part of a group of about 250 who were displaced when Armstrong "locked us out and wrongfully took possession of the property" valued at about $17 million, Olney said. In addition to return of the property, he hopes the court case will prove something else: "Just because the minister decides to go with a CANA group doesn't mean that all people have to agree with his analysis."

Founded in 1872, fifteen years before the formation of the Episcopal Diocese of Colorado, Grace and St. Stephen's is known as the birthplace of numerous other congregations, community service and cultural organizations. Among them: the Red Cross of the Pikes Peak region; Associated Charities; the Community Chest (later United Fund); the Visiting Nurses Association and many other ecumenical social ministries. An organist and choirmaster, Dr. Frederick Boothroyd, helped found Colorado Springs' symphony orchestra and became its first conductor.

Last November, however, a police squad raided the church and seized computers and financial records as part of an ongoing criminal investigation into charges that Armstrong had misappropriated funds. A spokesperson for the El Paso County Courts said February 9 that no criminal charges have been filed against Armstrong.

During the police presence Armstrong wandered the sidewalk in clerical robes, clutching the search warrant in his right hand, according to a November 26, 2008 Colorado Independent article.

The raid occurred a year after an ecclesiastical court had already judged Armstrong guilty of financial improprieties and sentenced him to deposition from ordained ministry; under diocesan canons Bishop Robert O'Neill had 30 days to impose a final sentence.

On September 26, 2007 the five-member panel of clergy and lay people unanimously found him "guilty on all counts … (of) theft of $392,409.93 from Grace Church, and causing Grace Church to issue false W-2s and underreport Armstrong's income and benefits by $548,097.27," according to Stokes.

The diocesan court also found Armstrong guilty on four other charges, including receiving illegal loans totaling $122,497.16 as well as "unauthorized encumbrance and alienation of Grace Church's real property, violation of the temporary inhibition placed on Armstrong and improper use of clergy discretionary funds and failure to maintain proper accounting records."

A November 26, 2008 Colorado Independent article listed allegations that Armstrong had used church money to pay for college for his children and for other personal use.

Armstrong, who refused to appear at his ecclesiastical trial, maintains his innocence. "Shame on them for running that kind of ecclesiastical court, to a successful priest of 30 years. It's like eating your own children," he said angrily. He dismissed the charges as "an attack on us and … (also) great evangelism. We have about 1,200 members now with the current congregation." He said "about one-quarter of the congregation have left for other denominations.

"I was already a priest in CANA," he added. "We were already in the process of considering leaving TEC. We were losing members by the droves." He said the congregation was also the home of the Anglican Communion Institute "and we were holding the feet of TEC to the fire about their right relationship to the communion."

But Olney, and about 250 members of the congregation who continue with TEC, also say the dispute has united them. "As far as our congregation, it's had a unifying effect," Olney said. "Everyone has had an opportunity to review and reflect on why they joined or continue to follow TEC and its doctrine.

"We start at 12:45 p.m. on Sundays," he said of the group, which rents space from the First Christian Church in Colorado Springs. "It takes an extra effort to go to a church service at 12:45 p.m. rather than 9:00."

The property dispute case

In 1986 the Colorado Supreme Court decided in favor of the diocese in a case involving another breakaway congregation, led by the Rev. James Mote, then rector of St. Mary's Church. Theological differences "concerning changes in the Book of Common Prayer, the authority of bishops to terminate marriages, the propriety of the ordination of women to the priesthood and other matters" prompted members to vote 197-79 to withdraw from the Episcopal Church, according to court records. They later affiliated with a newly formed Anglican Catholic Church, yet sought to retain church property.

In part, the court said that the congregation's articles of incorporations and bylaws, along with relevant provisions in the canons of the general church "demonstrate a unity of purpose on the part of the parish and of the general church reflecting the intent that the property held by the parish would be dedicated to and utilized for the advancement of the work of [then] PECUSA [the Protestant Episcopal Church in the United States of America]."

The court further said that "a trust has been imposed upon the real and personal property of St. Mary's Church for the use of the general church" and withdrawal of membership does not change that. "There is no question but that the utilization of the property by those members of St. Mary's who desire to remain affiliated with PECUSA under diocesan direction is in furtherance of that use."

Unlike his day in ecclesiastical court, Armstrong said he expects to prevail in the. "We fully anticipate prevailing in this trial," he said, adding, "and then we're sure that TEC will appeal it because they won't want to lose the property. This is the third year of the dispute. The real shame is we have a lot of ministries in Tanzania and when you look at the cholera and malaria problem there and the amount of money we've spent—the diocese spent $2 million in this case, we spent $1 million--can you imagine the number of mosquito netting that would buy?"

Olney and those parishioners continuing with TEC also want to get back into the church where they believe they rightfully belong and to continue its tradition of service and outreach "and what we believe in. We're optimistic that the judge will follow the Colorado case law in the Mote decision."

Regarding the outcome, he said: "We all have our prayers. We're just going to wait and see what happens." The trial is expected to last about six weeks.

More information may be found here.

--The Rev. Pat McCaughan is Episcopal Life Media correspondent for the dioceses of Province VII and VIII. She is based in Los Angeles.