A prudent man sees danger and takes refuge,
but the simple keep going and suffer for it (Prov. 22:3).

A. Times Have Changed

There was a time when few people would even consider suing a church. Those days are long gone.

Thousands of churches are sued every year in the United States, usually by their own members. Losing a lawsuit can result in devastating damages awards. Yet even when a church wins in court, it usually pays an enormous price in terms of legal fees, lost time and energy, distraction from ministry, and congregational dissension over the underlying causes of the conflict.

Litigation against churches is the result of many factors. The better you understand these issues, the better prepared you will be to protect your church from being sued. In this section we will briefly address some key issues.

The First Amendment has never made the church immune to being sued. This amendment provides only limited protection to religious bodies. It gives us the freedom to believe what we want, but it does not give us the freedom to take any and all action that we want. Therefore, courts do not allow churches or their leaders to hide behind the constitution to escape liability for harmful acts, even if those acts are religiously motivated. ¹

Money has become a major factor in church litigation. For example, fifty years ago, actions involving church discipline were usually filed to seek reinstatement of membership. Today they generally involve tort actions seeking large sums of money for invasion of privacy and the intentional infliction of emotional distress. As large financial awards against churches receive front-page coverage, more people are tempted to see lawsuits as a way to financial gain.

The American preoccupation with individualism also has contributed to the increase in litigation in the U.S., as has our diminished respect for authority and our embracing of relative morality. These changing attitudes have resulted in a general antagonism toward the concepts of responsibility, accountability, and discipline found in the church. This trend is reflected all too vividly in the following comments that were made in letters to a newspaper after a local church was held liable for damages because it excommunicated 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 member. . . . Taking up worship time to slander and belittle a person in front of a Sunday congregation is worthy of discipline itself.” ²

These attitudes are not confined to people outside the church. Many professing Christians prize individualism and independence more than they do responsibility and accountability. As a result, they are easily offended if their church attempts to correct unbiblical behavior. As many churches discover, it doesn’t take much for that offense to turn into the kind of anger that triggers a lawsuit.

Churches are often shocked to discover that they can be sued even when they sincerely believe they have done nothing wrong. And once an action is filed, they cannot simply say the complaint is unjustified and then ignore it. If the church does not respond with a full defense, it will lose automatically by default judgment and be subject to financial damages.

Churches are likewise dismayed to learn that it often costs plaintiffs little money to sue them. Many cases against churches are taken by attorneys on a “contingency fee” basis. This means that the plaintiff pays no attorney fees unless he or she wins the case. Thus, with very little upfront investment, plaintiffs can have a shot at winning a huge financial award. Since their attorneys typically receive 30% or more of the award, they are highly motivated to obtain the largest recovery possible.

The direct legal cost of defending against even a simple lawsuit is rarely under $50,000, and costs can easily climb into hundreds of thousands of dollars. A church’s legal defense costs are not paid on a contingency basis, but on a set hourly rate. Every time you talk with your attorney, the clock is ticking and your bill is increasing. Even if your church wins the lawsuit, it usually does not recover even a dime of its legal costs. Thus, even legal victories come at a high cost.

When a church loses such a lawsuit, awards for actual damages can easily exceed $100,000. Punitive damages awards can be even higher, climbing into the millions of dollars.

Even apart from these financial burdens, litigation can pull a church down like a monstrous whirlpool. Lawsuits—even the threat of lawsuits—inevitably cause major, irresistible disruptions in a church. A lawsuit demands a great deal of time, energy, and attention from key leaders, thus pulling them away from important ministry responsibilities. Litigation can also attract damaging publicity and divide a congregation, as members argue over who is to blame for the problem and how the suit should be handled. And like a whirlpool, it can spin for years, until the legal process runs its course of complaints, motions, depositions, hearings, trial, judgments, and appeals.

Even when a church is incorporated, its pastor and officers still can be found to be personally liable for damage awards in lawsuits related to counseling, confidentiality, sexual misconduct or church discipline. If insurance does not cover the entire award, a prevailing plaintiff can recover damages from a single church leader, who may then be compelled to sue fellow church officers to force them to share that cost.

Good insurance usually covers most of the financial costs associated with a lawsuit; however, it is sometimes insufficient to fully cover large awards. Moreover, insurance can never compensate a church for the greater cost of lost time, strife, frustration, and diversion from ministry that accompanies a lawsuit.

The moral of this ominous litany is quite simple: It is not good enough for your church to do things so well that you will prevail in a lawsuit, because even if you win, you have lost too much. Instead, today your church must do everything so well that you minimize the threat of lawsuit ever being filed.

B. Common Legal Actions Against Churches and Their Leaders

It could happen to you. During a counseling session with a couple who had been attending his church for a year, a pastor learned that the husband had a serious drinking problem. Counseling did not go well, and the couple eventually moved to another church. At the same time, the pastor learned that one of his elders was negotiating a major business contract with the husband. Not wanting the elder to get into a bad business arrangement, the pastor told the elder about the husband’s drinking problem. The elder later brought up the issue with the husband, and they had an argument that ended their plans of working together. Two weeks later, the husband sued the pastor and the church for invasion of privacy and interference with a contract. The church’s insurance company began to explore a settlement, but told the pastor that they might decide to deny him coverage since his conversation with the elder had nothing to do with church business.

The following discussion will focus on the most common legal claims that churches face when they fail to relate to others and respond to conflict in a biblically faithful manner.

This brief discussion (just three pages!) may seem technical and dry, but it is important to define a few of the key terms and concepts related to legal liability in the church. As we move on to describe practical defenses and safeguards, you will find the examples and principles to be personally interesting and immediately relevant to your church.

(1) Breach of Contract

A breach of contract is a failure to perform fully on a contract when the other party has performed. Breach-of-contract claims against a church usually arise when a church fails to pay for goods or services. Churches usually can avoid these types of claims by following Jesus’ command to let our yes be yes and to fulfill faithfully our commitments unless others willingly release us.

(2) Negligent Torts

A “tort” is a legal term for a wrongful act that results in damage to someone else. To win a tort action based on negligence, a plaintiff must prove: (i) that the defendant (sometimes a church) had a duty (independent of a contract) to act in a certain way toward the plaintiff; (ii) that there was an act or omission on the part of the defendant that breached that duty; and (iii) that the defendant's breach of duty was a proximate (closely related) cause of damage (physical, emotional or property) to the plaintiff.

Most negligence torts against churches claim that the church failed to do all it should to protect other people from foreseeable harm. Lawsuits against churches typically include the following claims:

• Negligence with regard to the condition of church premises or the conduct of church activities. Claims against a church usually arise when a member or visitor is physically injured in an accident while on the church's property (e.g., an adult slipping on an icy sidewalk) or when participating in an event sponsored by the church (e.g., a child being injured during a church-sponsored bicycle ride).
• Negligent hiring, supervision or retention of employees or volunteers. This claim involves an allegation of a failure to exercise reasonable care in the hiring, supervision or retention of an employee or volunteer, with such failure causing injuries to a third person. Actions against a church usually arise from an employee or volunteer injuring someone who belongs to or visits the church (e.g., a driving accident, sexual involvement with a counselee, or abuse of a child in the nursery or Sunday school).
• Clergy malpractice. This claim arises from any professional misconduct, unreasonable lack of skill or faithfulness, evil practice or immoral conduct in professional or fiduciary duties. Actions against churches usually involve a failure to refer a suicidal counselee to secular health care professionals or sexual involvement with a counselee. Generally, courts have not allowed clergy malpractice claims to stand; ³ even so, courts often have been willing to look to traditional tort theories to find a way to allow injured parties to be compensated.

(3) Intentional Torts

Intentional torts are similar to negligent torts, with the added requirement of proving that the defendant’s action was willful, that is, that he intended to accomplish the specific result that injured the plaintiff.

Intentional torts that are typically brought against churches include the following actions:

• Defamation. Defamation involves injuring a person's character, fame, or reputation by false and unprivileged statements (called “slander” when done verbally and “libel” when done in writing or fixed representation to the eye). Claims against a church usually arise when a church leader takes personal information related to pastoral counseling or church discipline and discloses it to other people.
• Outrageous conduct (also known as “intentional or negligent infliction of emotional distress”). This action involves intentionally or recklessly causing severe emotional distress to another by extreme and outrageous conduct. Claims against a church usually arise from disclosing personal information related to pastoral counseling or church discipline or sexual involvement by a pastor with a counselee.
• Breach of fiduciary responsibility. A fiduciary is a person who has a special relationship of trust and responsibility towards another (e.g., an attorney, CPA, counselor or pastor), which gives rise to a duty to deal in the utmost good faith and solely for the benefit of the person being served. Breach of this duty can arise from disloyalty, self-serving actions, or a failure to exercise reasonable skill and care. Claims against a church usually arise from: (i) a breach of confidentiality (e.g., revealing to others information gained in pastoral counseling); (ii) sexual involvement with a counselee; or (iii) placing undue influence on individuals to gift or devise property to a fiduciary.
• Invasion of privacy. When brought against a church, this cause of action is often based on putting a person in a false light, or the public disclosure of private facts that are objectionable to a reasonable person and not of legitimate concern to the public. Claims against a church usually arise from taking personal information related to pastoral counseling or church discipline and disclosing it to other people either within or outside the church.

C. Legal Defenses

It could happen to you. A pastor was told that a woman in his church was involved in an adulterous relationship and was filing for divorce. The pastor and other friends of the couple worked for months to persuade her to honor her marriage vows, but she refused to listen and forced her husband to move out. Seeing no sign of repentance, the elders initiated formal church discipline to help her see the seriousness of her sin and to let other members know that adultery has lifelong spiritual and worldly consequences. The next day the woman’s attorney called the pastor and said he would sue the pastor and the church for invasion of privacy and intentional infliction of emotional distress if they continued with discipline. The pastor calmly asked for the attorney’s fax number. A few minutes later the attorney saw the church’s disciplinary guidelines and a membership covenant signed by his client come through his fax machine. Realizing that his client had given informed consent to the church’s disciplinary practices, he called the woman to re-evaluate the merits of her case.

There are a variety of defenses that a church can make against the claims listed in the preceding sections. The single most important defense to any charge is being sure that you have been faithful to God and have obeyed his commands to the best of your ability. Pleasing God is far more important than pleasing any human, including a judge and jury.

And yet God has established civil authorities to restrain evil and punish wrongdoers (Rom. 13:1-5). Therefore, it is appropriate and wise for us to understand the legal defenses we can legitimately use when we are compelled to respond to a legal claim in a civil court. These defenses may be summarized as follows:

• Show that the plaintiff has not proven the basic elements of his or her cause of action.
• Convince the court that your actions are protected under the First Amendment to the United States Constitution.
• If accused of breach of contract, prove that you performed on the contract, or that you were released from performance because the other party failed to perform.
• If accused of defamation, prove that you spoke the truth. (This is a defense against defamation, but not against invasion of privacy.)
• If accused of defamation or invasion of privacy, prove that you had a qualified or constitutional privilege to publicize the information to people who had a legitimate interest in the information (e.g., telling elders or members about a disciplinary situation). ⁴
• Prove that the plaintiff had consented to your actions or waived his or her right to protest them (e.g., attended a membership class and signed a form saying he or she would submit to your disciplinary policies).
• In a tort action generally, prove that your actions were reasonable and appropriate in the particular situation, and that you did not violate any duty owed to the plaintiff or cause him any actionable injury.
• In negligent hiring or supervision cases, prove that the actions of the worker or volun-teer were not done as part of their proper job responsibilities, or prove that you took reasonable precautions to screen and manage your employees and volunteers.

It is dangerous for a church to assume that any of these defenses will provide absolute protection against a lawsuit. Court decisions are unpredictable, and many defendants are stunned when they lose a case that they assumed they would win. First Amendment defenses are particularly unreliable, as courts continue to develop new theories on religious liberty.

One of the most effective defenses to a lawsuit is informed consent. To secure this defense, you need to prove to a court that the person complaining of a wrong was in fact fully aware of your policies and procedures and knowingly agreed to be bound by them. As one court has written:

When people voluntarily join together in pursuit of spiritual fulfillment, the First Amendment requires that the government respect their decision and not impose its own ideas on the religious organization. Under the First Amendment people may freely consent to being spiritually governed by an established set of ecclesiastical tenets defined and carried out by those chosen to interpret and impose them: “The right to organize voluntary religious associations to assist in the expression and dissemination of any religious doctrine, and to create tribunals for the decision of controverted questions of faith within the association, and for the ecclesiastical government of all the individual members, congregations, and officers within the general association, is unquestioned. All who unite themselves to such a body do so with an implied consent to this government, and are bound to submit to it.” Watson v. Jones, supra. ⁵

If you can provide documentation of informed consent (e.g., a written statement clearly describing a particular policy and a related membership covenant signed by the plaintiff), you often can dissuade a threatening attorney from even proceeding with a case, thus preventing an expensive legal battle.

If an attorney continues to press the case, clear proof of informed consent can still prevent a prolonged and costly trial. Your attorney can present your evidence to a judge before trial. If the judge concludes that you had informed consent for what you did, there is a good chance that he will dismiss the case before it even goes to trial.

The bottom line is that treating people as you would want them to treat you and obtaining informed consent to your relational practices beforehand, are two of the best legal defense tactics a church can ever make.

D. Building a Guardrail to Protect Your Church

It could happen to you. A respected church member persuaded other members to invest thousands of dollars in a business venture. When the venture stalled and he refused to return their money, the investors complained to the pastor. The businessman rebuffed the pastor’s inquiries, so the elders mentioned the possibility of church discipline. A threatening call from an attorney successfully intimidated the elders, however, so they simply asked the businessman to find a new church. He complied and quickly chose a new flock to prey on, but he continued to bilk other members at the first church out of thousands of additional dollars. When those investors later discovered that their leaders had known of the businessman’s schemes and did nothing to warn them, they threatened to sue the church! The shepherds were discredited, the flock was ravaged, and the “wolf” continued to prowl.

One of the most tragic statements a pastor ever makes is, “I know the Bible says we should do something about this, but we’d better not, because we might get sued.” These words imply that a leader fears worldly consequences more than he loves and fears God.

A statement like this also suggests that a pastor and his leadership team have neglected to properly prepare their church for the conflicts and legal threats that are inevitable in a fallen world. As a result, they have limited their ability to minister robustly to their flock and protect it from harm. As Proverbs 22:3 warns, “A prudent man sees danger and takes refuge, but the simple keep going and suffer for it.”

The good news is that for a Christian (or a church) it is never too late to start doing what’s right. Even if you and the other leaders in your church have neglected to take proper precautions to protect your congregation in the past, you can reverse your situation by implementing the biblical and legal safeguards described in this manual.

With God’s help, you can build a biblically based “guardrail” to protect your church. Like the rail along a path going up a steep mountainside, this structure can protect your people in two ways. First, it can provide a clear boundary of standards and expectations; church members can see that they should stay inside it for their own safety and well-being. Second, if members fail to pay attention and stray from the path, your guardrail of biblical and legal safeguards often can limit how far they wander and prevent them from falling into serious harm.

There are several steps that your church can take to build a protective guardrail for your congregation. These steps can be organized into two major categories.

Adopt biblical and legal safeguards.

• Follow the Golden Rule.
• Use conciliation clauses.
• Establish prudent counseling policies.
• Define and respect confidentiality.
• Reduce the risk of child abuse.
• Work with local legal counsel.
• Practice biblical accountability and church discipline.

Promote membership and obtain informed consent to your practices.

• Adopt specific Relational Commitments
• Apply Relational Commitments to both members and attenders.
• Encourage formal membership.
• Teach, teach, teach!

Each of these measures is like a brick in a wall: the more bricks you use, and the more carefully you set them in place, the stronger your guardrail will be. Some of these measures may be put into practice immediately, while others will need to be discussed and implemented over months or years. Timing will depend on your congregation’s readiness for change and its familiarity with the biblical and legal concepts that underlie each measure.

Remember, this is not a matter of developing laborious legal limitations and protocols. Good risk management in the church is a matter of encouraging and teaching your people to relate to one another in a way that consistently reflects the power of the gospel and fulfills our Lord’s command to love one another as we love ourselves.