Copyright © May 6, 2016
“Separation of Church and State Law” ministry
“He that is faithful in that which is least is faithful also in much: and he that is unjust in the least is unjust also in much. If therefore ye have not been faithful in the unrighteous mammon, who will commit to your trust the true riches? And if ye have not been faithful in that which is another man’s, who shall give you that which is your own? No servant can serve two masters: for either he will hate the one, and love the other; or else he will hold to the one, and despise the other. Ye cannot serve God and mammon.” Lk. 16:10-13
“Let a man so account of us, as of the ministers of Christ, and stewards of the mysteries of God. Moreover it is required in stewards, that a man be found faithful.” 1 Co. 4.1-2
“But as we were allowed of God to be put in trust with the gospel, even so we speak; not as pleasing men, but God, which trieth our hearts.” 1 Th. 2:4
“According to the glorious gospel of the blessed God, which was committed to my trust.” 1 Ti. 1:11
“O Timothy, keep that which is committed to thy trust, avoiding profane and vain babblings, and oppositions of science falsely so called:” 1 Ti. 6:20
- Trust is a Bible concept
- The Trustor
- The Trustee
- A church Bible trust agreement and estate
- The wisdom of a Declaration of Trust
- American law recognizes and applies the concept of trust
American law recognizes, but did not originate, the concept of trust. Efforts of scholars to trace the origin have been futile. See, e.g., Fn 1, Trusts, Trust-Like Concepts and Ius Commune, 8 Eur. Rev. Private L. 453 (2000), C. H. van Rhee: “… Whether these origins are Roman, Canonical or Germanic [or of some other origin] remains an unresolved question. …”
Scholars have not considered all historic evidence. Had they done so, they would have discovered that the concept of trust was originated by God in the manner in which He ordered things. “Trust” is recognized by American law as will be seen below. See, 7. American law recognizes and applies the concept of trust, below. The concept of “trust” started in the beginning, in the Garden of Eden, and is evident throughout the Word of God. In the Bible, one finds by implication “trust” (also explicitly stated), “trust estate,” “trustor,” (or “grantor” or “settlor”), “trustee,” “beneficiary,” and “fiduciary.” Actually, the concept is just part of the way things work, the way God arranged things, as He explains in His Word.
The Roman Catholic “Church,” with all its heresies understood the this matter, although with some distortion, a long time ago:
“Trust-like devices were popular in the Church [speaking of the Roman Catholic ‘church’], since they allowed this institution to accumulate the necessary means to discharge its tasks. At the same time, these devices preempted the criticism that the Church was not practising [sic] its own teachings on the spiritual dangers of wealth. The wealth accumulated by the Church was not regarded as property owned by the Church itself. According to S. Herman, it was said to belong to God the Father as sovereign Lord, the Pope and his clerical lieutenants acting as His stewards. In trust terminology: God acted as ‘settlor’, while the Pope and his clerical lieutenants acted as trustees. Christ, the meek, the poor and the congregation were usually designated as ‘beneficiaries’. God, as the settlor, also figured as the ultimate beneficiary of creation. In this way, the wealth of the Church could be justified, since the Church simply acted as a depositary of goods created for all. Church officials were charged with managing the goods entrusted to them as ‘trustees’ and with using them for the good of the community. ” See Trusts, Trust-Like Concepts and Ius Commune… Op Cit.
Of course this Catholic misunderstanding allowed the Institution of the Roman Catholic “Church” to prosper and the clergy to live a luxurious life (the “beneficiaries” in practice although not in name) because the trust estate was not used for the benefit of God, the true owner of all things, and all mankind. The Catholic Church, accordingly, has stored up tremendous wealth and actually worships mammon. Nonetheless, even though misapplying the concept, Catholicism recognized it.
Most contemporary “Bible believing Christians” in America have no idea of the concept. Rather, most prostitute their churches through the use of various legal entity devises such as church incorporation and Internal Revenue Code Section 501(c)(3) or 508 status.
This article examines the Bible doctrine of trust and its proper application by churches. A church can operate according to the principles of the New Testament only should she apply the concept of trust. God entrusts a New Testament (“NT”) church to her members. He wants each church to operate and organize according to His precepts as laid out in the Bible. According to the NT, a church is to be a spiritual entity only. A spiritual entity cannot hold property or money, sue, be sued, enter into contracts or act legally in any way. Only a temporal entity can do those things. See, for explanation, What Is a Church and What Upholds Her Integrity? (article); see also, Separation of Church and State/God’s Churches: Spiritual or Legal Entities? (book).
God wants members of His churches to give to Him, not to their church. If church members (a church is made of her members ) give to a church, that church gives to herself. Of course, many believers in non-NT churches while giving to the churches they are members of, not to God, believe in their heart they are giving to God. I believe God will honor their giving, even though not according to knowledge, understanding and wisdom. However, when one grows to understand the truth about giving to God, he has a responsibility to begin to do things God’s way.
This article will answer the question, “How can a church organize such that the church complies with Bible principles?” The answer in a nutshell is by complying with Bible teaching on the matter. There is only one Bible way to do so. That is by establishing a trust relationship with money and property. When church members give to God, they should entrust their gifts and offerings to someone who holds and manages God’s money and property for the benefit of the true owner, the Lord Jesus Christ.
The principle of trust originated with God. God embedded this precept in His word and it is seen from Genesis to Revelation. God has administered his rule over the world in various dispensations or economies as He progressively works out His purpose of world history. The principle is still effectual to this day. Primarily, dispensations are stewardships. All in a particular dispensational economy are stewards, although one man usually stands out. For example, Paul was used by God more than any other to reveal His grace. Nonetheless, all the apostles and every other believer are also stewards of God’s grace. All have a responsibility to respond to that grace. God will judge those who fail to do so. (Charles C. Ryrie, Dispensationalism (Chicago: Moody Press, 1995), pp. 56-57; for an more detailed analysis of dispensations and dispensationalism, see the short article The Essence of Dispensationalism).
God created all things and owns all things. (Ge. 1.1). After the creation, God “saw every thing that he had made, and behold, it was very good.” (Ge. 1.31).
God is trustor or settlor – God established the trust relationship whereby man holds God’s property in trust for God, the owner. Man is trustee under God with a fiduciary duty to use all God has given him for the glory of God. Obedience to God brings blessings. Disobedience brings curses.
God entrusted the earth to man. God as trustor or settlor established the trust agreement. The trust estate is His. Man was trustee. Man, as trustee, has a fiduciary duty, under God, to care God’s earthly trust estate for Him. Man’s God-given purpose is to glorify God in all things. “Whether therefore ye eat, or drink, or whatsoever ye do, do all to the glory of God” (Corinthians 10:31).
Every man has a choice of glorifying God or not glorifying God. The first step is salvation. The light of salvation comes to every man (See John 3.16-22); some come to it, some do not. Even after salvation, new light continues to shine through; one either comes to that light or rejects it. Only the saved man is made privy to additional light from God; when that light comes to him, he either accepts and acts on it or rejects it. “For every one that doeth evil hateth the light, neither cometh to the light, lest his deeds should be reproved. But he that doeth truth cometh to the light, that his deeds may be made manifest, that they are wrought in God” (John 3:20-21). “The night is far spent, the day is at hand: let us therefore cast off the works of darkness, and let us put on the armour of light” (Romans 13:12; written to believers).
God made man trustee of that which God gave him. A trustee is one who holds money or property for the benefit of someone else. He has a fiduciary duty to do so.
The beneficiary of all things is God. Man, as trustee, is to hold and manage all things for the benefit of the true, beneficial, and equitable owner of all things, for God.
God gave the first man man only one commandment or rule—not to eat of the fruit of the tree of knowledge of good and evil. Man violated the rule and fell. All was no longer good. God judged the serpent, Adam, and Eve. Man remained trustee of all that God had given him; but God changed things. Churches, in general, continue to dishonor rather than to glorify God by rejecting God’s trust relationship and replacing it with some kind of earthly man-made organizational scheme which places them under some authority other than the Lord Jesus Christ.
2. Trust is a Bible concept
Some meanings of trust, as given in the 1828 Webster’s Dictionary, are:
- Confidence; a reliance or resting of the mind on the integrity, veracity, justice, friendship or other sound principle of another person. He that putteth his trust in the Lord shall be safe. Proverbs 29:25.
- Something committed to a person’s care for use or management, and for which an account must be rendered. Every man’s talents and advantages are a trust committed to him by his Maker, and for the use or employment of which he is accountable.
Both definitions are Biblical. This article will deal with definition 2 above. From that definition, one can see that the God ordained trust arrangement with mankind has a trust estate, a trustor, a trustee, a beneficiary. The true, beneficial, and equitable owner of all things, both material and spiritual, is God; He is the beneficiary. The creator, trustor, or settlor of the trust arrangement is God. God established the trust estate, made up of both material and spiritual elements. Man is the trustee of all the trust estate. As trustee, he is to manage all that God entrusted to him for the benefit of, God, the true owner of the estate.
God owns everything—not only the land, but also everyone and everything. That ownership is implicit in the fact that He created it all. (Ge. 1). He clearly stated His ownership of all in His Word:
- God said, “Now therefore, if ye will obey my voice indeed, and keep my covenant, then ye shall be a peculiar treasure unto me above all people: for all the earth is mine:” (Ex. 19.5).
- God said, “The land shall not be sold for ever: for the land is mine; for ye are strangers and sojourners with me.” (Le. 25.23).
- “But who am I, and what is my people, that we should be able to offer so willingly after this sort? for all things come of thee [God], and of thine own have we given thee.” (1 Chr. 29.14).
- “The earth is the LORD’S, and the fulness thereof; the world, and they that dwell therein.” (Ps. 24.1).
- God said, “For every beast of the forest is mine, and the cattle upon a thousand hills.” (Ps. 50.10).
- “The heavens are thine [God’s], the earth also is thine: as for the world and the fulness thereof, thou hast founded them.” (Ps. 89.11).
- “The silver is mine, and the gold is mine, saith the LORD of hosts.” (Hag. 2.8).
For example, when a church assembles together, God owns the land upon which they meet. The land is temporarily loaned to man for the benefit of God, the true owner. Although man has the temporal and legal title to the land, God is the true, beneficial, and equitable owner. An equitable owner is “[o]ne who is recognized in equity as owner of the property, because real and beneficial use and title belong to him, even though bare legal title is invested in another.” (BLACK’S LAW DICTIONARY (6th Ed. 1990), 539). “In a trust relationship, as distinguished from a ‘contract,’ there is always a divided ownership of property, to which the trustee usually has legal title and cestui [que trust] an equitable title.” (90 C.J.S. Trusts § 1, fn. 13 (2007). C.J.S., like AM. JUR 2D, is a highly respected, used, and cited legal encyclopedia).
The Bible teaches that God, the true owner of all things, entrusted man, under God, with the earth and all that was in it. God entrusted man with His property. Man was put in trust to administer God’s earthly property according to God’s plan. Man did not own the earth, but, of course, man benefited from use of the property entrusted him. Man was to use the property God entrusted him with for the glory of God, for God’s pleasure. (Re. 4.11).
The word of God also teaches that God entrusted a New Testament church to the members of the church.
A trustee is “a person to whom anything is committed, in confidence that he will discharge his duty.” Man was trustee of God’s property. Church members are trustees of the church they are members of.
Man was a fiduciary. Fiduciary, as a noun, means “One who holds a thing in trust; a trustee.” Man, as trustee, had a fiduciary duty to hold and administer God’s property for the benefit of God. Church members have a fiduciary duty to organize and operate the church they belong to according to God’s guidelines as stated in the New Testament. Fiduciary as an adjective means, “Not to be doubted; as fiduciary obedience” or “Held in trust.” Man benefits from use of God’s property and church members benefit from belonging to a church under God only.
“And the LORD God commanded the man, saying, Of every tree of the garden thou mayest freely eat: But of the tree of the knowledge of good and evil, thou shalt not eat of it: for in the day that thou eatest thereof thou shalt surely die.” (Ge. 2:16-17). Eating of the true of knowledge of good and evil was a violation of man’s fiduciary duty to administer God’s property for the benefit of the true, beneficial, and equitable owner of the property.
God entrusted Adam and Eve with the earth and all that is in it and gave them responsibilities:
“And God blessed them, and God said unto them, Be fruitful, and multiply, and replenish the earth, and subdue it: and have dominion over the fish of the sea, and over the fowl of the air, and over every living thing that moveth upon the earth. And God said, Behold, I have given you every herb bearing seed, which is upon the face of all the earth, and every tree, in the which is the fruit of a tree yielding seed; to you it shall be for meat. And to every beast of the earth, and to every fowl of the air, and to every thing that creepeth upon the earth, wherein there is life, I have given every green herb for meat: and it was so. And God saw every thing that he had made, and, behold, it was very good. And the evening and the morning were the sixth day.” (Ge. 1.28-31).
Man violated his duty and God held him accountable. Satan lied to man and tempted him to eat of the fruit of the tree of the knowledge of good and evil and man fell or violated his fiduciary duty with bad results.
“And when the woman saw that the tree was good for food, and that it was pleasant to the eyes, and a tree to be desired to make one wise, she took of the fruit thereof, and did eat, and gave also unto her husband with her; and he did eat. And the eyes of them both were opened, and they knew that they were naked; and they sewed fig leaves together, and made themselves aprons.” (Ge. 3:6-7).
God then judged man, woman, and Satan. Things changed. No longer was all that God had made good.
“And the LORD God said, Behold, the man is become as one of us, to know good and evil: and now, lest he put forth his hand, and take also of the tree of life, and eat, and live for ever: Therefore the LORD God sent him forth from the garden of Eden, to till the ground from whence he was taken. So he drove out the man; and he placed at the east of the garden of Eden Cherubims, and a flaming sword which turned every way, to keep the way of the tree of life.” (Ge. 3:22-24)
Man remained in trust of all that God gave him. Mankind continued as trustee of God’s earthly property. Man had legal title to God’s earthly propery. The perpetual principle that nations—Gentile nations and Israel—and individuals were left in trust of land and all things for the benefit of God runs throughout the Bible and continues.
As recorded in the NT, God ordained his church, an institution made up of local autonomous spiritual bodies.
3. The Trustor
As shown above, God is trustor or settlor of all things. A trustor or settlor is the one who establishes a trust agreement. This is because He owns all things. Once God created man, He gave man the duty to oversee His creations; God put man in trust with His earth and all that is in it. God put church members in trust with His churches.
The Lord spoke of the concept of trust in at least two parables as recorded in the books of Matthew and Luke. (Mt. 25.14-30; Lu. 19.12-27). He spoke of an earthly master leaving certain amounts of his goods or money with his servants, according to their abilities. The more important parallel spiritual meaning was to the Lord and His servants. The master had an absolute right to his own goods, but he distributed to his servants to be used for the benefit of the master, the servants to be awarded according to their profitable use of the property entrusted to them. Some used the money productively and upon the master’s return presented him with a profit. The property belonged to the master, and the servants were to use it for the master’s benefit, not for their own benefit. Of course, they would be rewarded if they used the property wisely for the benefit of the master. One servant in each example returned only the original amount left in trust with them. The master instructed that the goods which he had left with the unprofitable servants be taken from them, and they were left with nothing. The profitable servants were rewarded by the master. In the story found in Matthew, the Master said, “[C]ast ye the unprofitable servant into outer darkness: there shall be weeping and gnashing of teeth.” (Mt. 25.30).
The parables of the last paragraph speak of the heavenly master (trustor) and his earthly trustees. Men, as servants of the Master are left in trust of all things for His benefit and will be rewarded or punished according to their use of His goods.
A church, under God, acts as the trustor of a church Bible trust agreement—the church by so doing is recognizing and acting on the Bible principles regarding trust.
4. The Trustee
According to Scripture, who should be the trustee named in a church Bible trust agreement?
Timothy was a preacher with a special position of trust. Timothy was a trustee of a spiritual heritage: “O Timothy, keep that which is committed to thy trust, avoiding profane and vain babblings, and oppositions of science falsely so called:” (1 Ti. 6.20). Likewise, elders, which includes pastors, must meet specific requirements which not every man in a church can meet. (See, for example, Tit. 1.5-9). These elders must hold fast the Word of God, “that he may be able by sound doctrine both to exhort and to convince the gainsayers” (Tit. 1.9-16, 2.2; see also, Ac. 11.30, 14.23, (ordained elders in every church), 15.2, 4, 6, 22-23, 16.4, 20.17, 21.18; 1 Ti. 5.1 (“rebuke not an elder, but entreat him as a father”), 1 Ti. 5.17-19; Ja. 5.14-15; He. 13.7, 17; 1 Pe. 5.1 (Peter the Apostle was an elder, here writing to “the elders who are among you”; 1 Pe. 5.5 (younger to submit to the elder, and all to submit to one another); 2 Jn. 1 and 3 Jn. 1 (John the Apostle was also an elder);
Biblically, a pastor must meet stringent God-given requirements:
- “This is a true saying, If a man desire the office of a bishop [pastor], he desireth a good work. A bishop then must be blameless, the husband of one wife, vigilant, sober, of good behaviour, given to hospitality, apt to teach; Not given to wine, no striker, not greedy of filthy lucre; but patient, not a brawler, not covetous; One that ruleth well his own house, having his children in subjection with all gravity; (For if a man know not how to rule his own house, how shall he take care of the church of God?) Not a novice, lest being lifted up with pride he fall into the condemnation of the devil. Moreover he must have a good report of them which are without; lest he fall into reproach and the snare of the devil.” (1 Ti. 3.1-7).
- “For a bishop must be blameless, as the steward of God; not selfwilled, not soon angry, not given to wine, no striker, not given to filthy lucre;” (Tit. 1.7).
These requirements are strict because a pastor, and every member of a church, is entrusted by God to “take care of the church of God.” (1 Ti. 3.5). He is a trustee of God.
“The elders [pastors included] which are among you I exhort, who am also an elder, and a witness of the sufferings of Christ, and also a partaker of the glory that shall be revealed: Feed the flock of God which is among you, taking the oversight thereof, not by constraint, but willingly; not for filthy lucre, but of a ready mind; Neither as being lords over God’s heritage, but being ensamples to the flock. And when the chief Shepherd shall appear, ye shall receive a crown of glory that fadeth not away.” (1 Pe. 5.1-5).
The Bible proclaims: “Remember them which have the rule over you, who have spoken unto you the Word of God: whose faith follow, considering the end of their conversation.” (He. 13.7). “Obey them that have the rule over you, and submit yourselves: for they watch for your souls, as they that must give account, that they may do it with joy, and not with grief: for that is unprofitable for you.” ( He. 13.17). “Salute all them that have the rule over you, and all the saints….” (He. 13.24). “Them” is plural, and includes the pastor and other elders of a church.
The elders, including the pastor, are to oversee a church: “Take heed therefore unto yourselves, and to all the flock, over the which the Holy Ghost hath made you overseers, to feed the church of God, which he hath purchased with his own blood.” (Ac. 20.28). Paul was speaking to the elders of the church at Ephesus (Ac. 20.17-18).
A pastor is responsible to act as a ruler, trustee, steward, and overseer of a church. As such, he should be as qualified as any other elder to be the trustee given oversight of a trust established by a church.
Likewise, all men are trustees over that with which God has entrusted them. A father is a trustee of his family. A civil government is a trustee which is to operate under God within its God-given jurisdiction. God has appointed every human being who has ever lived as trustee over himself, all that God has given him, his spiritual heritage, and his spiritual destiny. The earth is still God’s, but He told man care for and possess His earth. Mankind is “trustee” of the earth. The pastor is a trustee, and a prominent trustee, of a church.
5. A church Bible trust agreement and estate
A church can remain a spiritual entity only by utilizing the Bible concept of trust, whether declared in writing or not. In a Bible trust arrangement, God’s spiritual and temporal rules are honored. Regarding money and property, a church is trustor, the appointed temporal and legal owner of the trust estate is the trustee, and the Lord Jesus Christ is the beneficiary. The beneficiary is, by definition, the true, beneficial, and equitable owner of the property held in the trust estate. Gifts, tithes, and offerings are to God (to the trust estate which is owned by God), not to the church. The church is the giver, God is the recipient and owner.
This type of trust arrangement is Scriptural. The church is not the trust and the trust is not the church. The church remains totally under the authority of the Lord Jesus Christ and His word. The trustee does not hold the property for the church. The trustee holds the property for the benefit of the true owner of the property, the Lord Jesus Christ. The trustee is the legal owner of the property and the Lord Jesus Christ is the true, equitable, and beneficial owner. The trustee has a fiduciary duty under God to use the property, not for his own or the trustor church’s benefit, but for the benefit of the Lord Jesus Christ.
As to property on which a church meets, the state will declare someone to be legal owner of that property if no one lawfully has title and if it is brought to the attention of the state. The law requires someone to hold legal title to real property. A New Testament church is to be, according to Scripture, a spiritual entity only. Therefore, a New Testament church cannot hold title to property. Should a church hold title to property through a trustee or trustees, that church is no longer a spiritual entity only because she has entwined herself with the legal system. A title is a legal declaration of ownership.
Only a legal entity can act legally, sue, be sued, enter into contracts, or be charged with a crime. To assume ownership of property is to act legally. Every American citizen in his right mind is a legal entity. Likewise, corporations (aggregate of sole, profit or non-profit), charitable trusts, business trusts, and Internal Revenue Code § 501(c)(3) and § 508 organizations are legal entities. A church who owns property through one of these legal devises is asserting ownership. A church who does not hold property or money but puts money and perhaps property into a trust estate whose owner is the Lord Jesus Christ is not acting legally. The trustee of such a trust holds legal or earthly title to the money are property, if any, in the trust estate. He is to administer the money and property, if any, for the benefit of the true owner of the property, the Lord Jesus Christ. On the other hand, a church who holds property through a trustee for the benefit of the Lord Jesus Christ is a legal or earthly entity.
Holding property in the recommended manner has additional benefits. Not only does holding property in this manner comport with biblical principles, it also lessens the chances that the property, and especially the buildings, will become idols. “Their idols are … the work of men’s hands. … They that make them are like unto them; so is every one that trusteth in them.” (Ps. 115.4-8). Finally, holding property in this way assures that a church has chosen not to be structured like a business or a government created organization; that church can operate according to the principles in the New Testament.
6. The wisdom of a Declaration of Trust
Wisdom dictates that the best course of action—for a church who meets on property entrusted to a trustee for the benefit of the true owner of the property, the Lord Jesus Christ, and or hands over tithes, offerings, and/or gifts to a trustee to be held and used for the benefit of the Lord Jesus Chris—is to properly write and execute a declaration with supporting document(s) of the principles and terms of the trust. A “declaration” is a publication or manifestation. A good name for this type of writing is “Declaration of Trust (‘DOT’).” This section will cover the reasons why wisdom recommends the use of such a declaration.
First, a DOT which describes a Bible Trust relationship totally conforms to Scriptural principles and guidelines. It, with supporting documents, makes clear to all that the church, as trustor or settlor, remains a spiritual entity and closes the door to all legitimate arguments that the church is not a legal, as opposed to a spiritual, entity.
Second, a well written and executed DOT and supporting documents settle arguments about the terms of the trust and the intended use of the trust estate. No disgruntled church member can rewrite (without support of the other members) or control the terms of the trust agreement. No such member can argue that any type of contract, charitable trust, or other legal arrangement was intended or implemented. The door is closed for such a member to control the church property (the Declaration makes clear that the trust property and monies belong to God, not to the church), and/or to control the spiritual direction of the church. No government agent can argue the type of trust created or the intent of the creator(s) of the trust agreement. The written Declaration, if in conformity to Bible principles, serves as the light and authority as to intent and terms. Should anyone dispute the terms of the trust relationship, the Declaration serves as the standard.
Third, if such Declaration and supporting document(s) reflect Bible principles, they serve as an educational tool to church members, other churches, the lost, and the saved. God’s light shines through the documents. The documents proclaim the Bible truths being implemented.
Fourth, a properly worded and executed Declaration and supporting document(s) are solid proof that neither the trust agreement thereby created and declared nor the trustor church is a business trust, charitable trust, non-profit corporation, unincorporated association, or other type of creature of the state which is legally organized under state law.
Fifth (to repeat the first for emphasis), a properly worded and executed DOT and supporting document(s) make clear that no type of business or government entity is thereby created and that the church is a spiritual entity under God only, not a two headed monster partially under the state and partially under God.
7. American law recognizes and applies the concept of trust
One can start his legal research to verify this matter in many places. He can do a word search on a legal website such as Westlaw or Lexis. Since access to these websites is expensive, for the most part only lawyers and paralegals who regularly practice or research law will find it practical to use them. One can also go to the law library and go to case digests, treatises, case reporters, legal encyclopedias and other sources.
On the subject of trusts, this author started with a legal encyclopedia, American Jurisprudence 2nd, Volume 76, Trusts. In explaining the concept of trust, this author used that resource, with some information from Corpus Juris Secundum, another legal encyclopedia, to give an overall explanation of the concept in its use by churches to remain spiritual entities only, as opposed to incorporated 502(c)(3) legal organizations. See, Chapter 7 of PDF of 2nd Edition of Separation of Church and State: God’s Churches – Spiritual or Legal Entities?
See Fn2 for some excerpts from some cases which define and apply the trust relationship.
God instituted the concept of trust in the beginning, in the Garden of Eden. It is a biblical concept which, when properly implemented, keeps a church under God (the Scriptures) only. If a church is a NT church, that church has established a trust agreement with the Lord; her gifts are to a trustee. The trustee holds any money or property given to the Lord for the benefit of the true owner or the money and property, the Lord Jesus Christ. A properly worded and executed Declaration of Trust and supporting documents serve as a standard for church members and for the world as to the intent of the creators of the trust agreement and as a light to the world.
The American legal system did not legislate the concept of trust, but merely recognizes the concept. A basic trust is not a legal entity. See, Powerpoint: The Basics of the Bible Principle of Trust in Church Organization; Explanation of “Trust,” as opposed to “Business Trust,” “Charitable Trust,” and other kinds of trusts. How can you know who to trust for the truth about these matters? How can you know if what is presented here is the truth? Etc. Of course, the legal system has expanded the basic concept of trust far beyond its original God established meaning. “Business trusts,” “charitable trusts,” and various other types of trusts are legal entities. The legal system recognizes the basic “trust” in the church and religious institution context, as shown above.
Should any member dislike the way the Lord’s money is spent by the trustee, he can quit giving his money to the Lord’s estate. Should he complain about property which were paid for in part or whole by his past giving, he can take it up with the Lord since the property is the Lord’s.
The church, the trustor or settlor, implements God’s guidelines as to both eternal spiritual and temporal material matters. The trustee holds property (if any) and money in a trust estate for the benefit of the Lord Jesus Christ, the true, equitable, and beneficial owner of all things. As trustee, he is the temporal and legal owner of the Lord’s properties and monies held in the trust estate.
The trustee has a duty as a fiduciary to manage the trust estate for the benefit of the Lord Jesus Christ, not for his own benefit. He is not to utilize the property as a profit-making venture in any way. If he violates his fiduciary duties as God’s trustee, God will certainly hold him accountable. “For we know him that hath said, Vengeance belongeth unto me, I will recompense, saith the Lord. And again, The Lord shall judge his people. It is a fearful thing to fall into the hands of the living God.” (He. 10.30-31).
For a basic understanding of the concept as it should be applied by churches see PowerPoint: The Basics of the Bible Principle of Trust in Church Organization. “Trust” Explained and Differentiated from “Business Trust,” Charitable Trust, and other kinds of trusts. (If you click the link, the PowerPoint will download onto your computer.
Fn 1. Trusts, Trust-Like Concepts and Ius Commune, 8 Eur. Rev. Private L. 453 (2000), C. H. van Rhee: This article concludes:
“Trust and Ius Commune: an Assessment
On the basis of the above, several conclusions may be drawn. Firstly, it may be concluded that it is very likely that the origins of the trust cannot completely be traced. Whether these origins are Roman, Canonical or Germanic remains an unresolved question. A link between Romanocanonical usus -Roman usus in a Canonical guise- and the trust seems the most promising of all possible links. However, much research needs to be conducted of ecclesiastical records both on the continent and in England. Examining these records should be the primary aim of legal historians interested in the origins of the trust.
“Secondly, the nineteenth-century shift from Roman law to indigenous law as the alleged origins of the trust did not change the position of the trust as a concept which may be placed in the ius commune tradition. Both the Germanic and Romano-canonical origins of the trust are of interest to scholars studying the question of whether trusts are part of a shared European tradition. As we know, ius commune comprised elements from both the Germanic and the Romano-canonical legal traditions.
“And thirdly, it may be concluded that it is very unlikely that there has been an exact
continental equivalent to the English ‘use’ or trust. The conclusion may be drawn that trust law cannot be viewed as an amalgam of concepts from the Corpus Iuris. This conclusion has also been drawn by Kenneth Reid (see his paper), who alleges that the modern trust is a relatively new concept, which cannot be explained solely by a contract/real right model. Nevertheless, we must continue to ask the question whether the uncovered similarities amount to more than parallels reflecting similar social conditions. My answer to this question is that it is very likely that English trust law was influenced by ideas on the Continent. This is not too bold a statement paying regard to the influence of the ecclesiastical courts in England as well as to the fact that English civilians frequently used Roman and Canon law texts when describing trusts.”
An interesting except from the article:
“Trust-like devices were popular in the Church [speaking of the Roman Catholic ‘church’], since they allowed this institution to accumulate the necessary means to discharge its tasks. At the same time, these devices preempted the criticism that the Church was not practising [sic] its own teachings on the spiritual dangers of wealth. The wealth accumulated by the Church was not regarded as property owned by the Church itself. According to S. Herman, it was said to belong to God the Father as sovereign Lord, the Pope and his clerical lieutenants acting as His stewards. In trust terminology: God acted as ‘settlor’, while the Pope and his clerical lieutenants acted as trustees. Christ, the meek, the poor and the congregation were usually designated as ‘beneficiaries’. God, as the settlor, also figured as the ultimate beneficiary of creation. In this way, the wealth of the Church could be justified, since the Church simply acted as a depositary of goods created for all. Church officials were charged with managing the goods entrusted to them as ‘trustees’ and with using them for the good of the community. “
Fn2 You may go directly to the cases by clicking the casename.
KOPSOMBUT-MYINT BUDDHIST CENTER, v. STATE BOARD OF EQUALIZATION, 728 S.W. 2d 327 (1986) Court of Appeals of Tennessee, Middle Section, at Nashville. Permission to Appeal Denied, April 6, 1987. IMPORTANT POINT: The court itself declared that the property at issue was held in trust even though there was no writing directly proclaiming a trust. The court did this in order to uphold a property tax exemption. Property held in trust for a Buddhist Temple qualifies for a property tax exemption, if the property is used for religious purposes and the owner, any stockholder, officer, member or employee of such institution is not lawfully entitled to receive and pecuniary profit from the operations of that property in competition with like property owned by others which is not exempt. Property held in trust and which otherwise qualifies for the exemption is to be exempted from property tax. Of note, for emphasis, it was obvious that corporate, 501(c)(3) status was not a prerequisite for religious property tax exemption. Also, this case deals with a “trust,” not a “business trust” “charitable trust” or some other type of trust that is a legal entity.” The opinion states:
- “A valid trust need not be in writing. It can be created orally unless the language of the written conveyance excludes the existence of a trust. Sanderson v. Milligan,585 S.W.2d 573, 574 (Tenn. 1979); Linder v. Little, 490 S.W.2d 717, 723 (Tenn. Ct. App. 1972); and Adrian v. Brown, 29 Tenn. App. 236, 243, 196 S.W.2d 118, 121 (1946). However, when a party seeks to establish an oral trust, it must do so by greater than a preponderance of the evidence. Sanderson v. Milligan, 585 S.W.2d 573, 574 (Tenn. 1979); Hunt v. Hunt, 169 Tenn. 1, 9, 80 S.W.2d 666, 669 (1935); and Browder v. Hite, 602 S.W.2d 489, 493 (Tenn. Ct. App. 1980).
- “The existence of a trust requires proof of three elements: (1) a trustee who holds trust property and who is subject to the equitable duties to deal with it for the benefit of another, (2) a beneficiary to whom the trustee owes the equitable duties to deal with the trust property for his benefit, and (3) identifiable trust property. See G.G. Bogert & G.T. Bogert, The Law of Trusts and Trustees § 1, at 6 (rev. 2d ed. 1984) and Restatement (Second) of Trusts § 2 comment h (1957). We find that the Kopsombut-Myint Buddhist Center has proved the existence of each of these elements by clear and convincing evidence.” [p. 333].
WAUSHARA COUNTY v. Sherri L. GRAF, 166 Wis.2d 442 (1992), 480 N.W.2d 16, Supreme Court of Wisconsin. Submitted on briefs October 4, 1991.Decided February 17, 1992. The Supreme Court of Wisconsin reviewed the evidence and concluded that “The evidence indicates that Basic Bible was established to evade taxation. Basic Bible failed to meet its burden of proving that it is a “church” or “religious association” under [Wisconsin law]. The court held that Basic Bible was not property tax exempt.” The fact that the church held “in trust” the property for which a property tax exemption was sought was not a factor in the decision. The Court concluded that incorporation and 501(c)(3) status is not a prerequisite for church property tax exemption; and, again, made clear that the fact that the church held the property “in trust” did not disqualify the church from property tax exemption.
Note. Many, many cases are on the record involving denials of “church,” or “religious organization” property tax exemption for incorporated 501(c)(3) tax scams. See, for some examples, III. Organizations which created religious scams in order to obtain Property Tax Exemption on the webpage, Law on Church Organization (Trusts, Property tax, etc.). WAUSHARA COUNTY v. Sherri L. GRAF is the only case I have found in which a “church” or “religious organization or society” which held property and/or money in trust was held to be such a scam. Also, by reading this entire case with knowledge, one versed in these matters readily sees that Basic Bible did not understand the law nor the Bible. One could write a lengthy analysis proving that. Also very interesting is the analysis of the pro se representation in this case.]. This case reminds one of the unjust steward, an outright crook, in Luke 16. “No servant can serve two masters: for either he will hate the one, and love the other; or else he will hold to the one, and despise the other. Ye cannot serve God and mammon” Luke 16.13.
The Wisconsin Supreme Court stated, in WAUSHARA COUNTY v. Sherri L. GRAF:
- “We need not reiterate the excellent discussion and analysis underpinning that conclusion that appears in the court of appeals opinion. 157 Wis. 2d at 539-49” [the citation for this case].
The opinion from the court of appeals referred to by the Wisconsin Supreme Court was WAUSHARA COUNTY v. Sherri L. GRAF, 157 Wis.2d 539 (1990), 461 N.W.2d 143, Court of Appeals of Wisconsin. Submitted on briefs December 8, 1989. Decided August 2, 1990. Here are some very important points made on pp. 539-49 of that decision:
The court examined the legislative history of the pertinent statutes to determine if a church or religious organization must be incorporated for its property to be tax exempt [under state law].
- The court started with examination of the first exemption from taxation of the property of churches and religious organizations—in sec. 24, ch. 47, Revised Statutes of 1849. “Chapter 47 prescribed the procedure by which persons belonging to a church congregation or religious society, “not already incorporated,” could incorporate. … The exemption was not limited to religious societies incorporated under ch. 47.
- “Chapter 130, Laws of 1868, provided for the assessment of property for taxation and for exemptions therefrom. Section 2, 3d exempted “[p]ersonal property owned by any religious, scientific, literary or benevolent association, used exclusively for the purposes of such association, and the real property necessary for the location and convenience of the buildings of such association . . . not exceeding ten acres. . . .” Chapter 130 did not define “association.”
- “Section 2 of ch. 130, Laws of 1868, was incorporated, without substantial change, in Section 1038, Wisconsin Statutes of 1898. Section 1038, subd. 3 was renumbered sec. 70.11(4), Stats., by sec. 16, ch. 69, Laws of 1921. Throughout its history, the exemption from taxation of property of churches and religious associations has been accorded in substantially the same language. No “linkage” has existed between the exemption statutes and those affecting the organization of churches and religious associations or societies.
- “Chapter 411, Laws of 1876, provided for the incorporation of religious societies. Apparently this act replaced ch. 47 of the revised statutes of 1849. Chapter 411 is silent as to the taxation or exemption of the property of religious societies incorporated thereunder.
- “The procedures for the incorporation of religious societies were included in ch. 91, Revised Statutes of 1878. Nash’s Wisconsin Annotations (1914), sec. 1990, ch. 91 at 753, states: ‘The revisers of 1878 in their note said: ‘Chapter 411, 1876, is taken to have been intended as a revision of the law for the incorporation of religious societies.’ The privilege of organizing a corporation is extended to all classes and denominations, it not being supposed the law means to be intolerant of any religious belief or to be partial in its offer of privileges.’
- “The same annotation at page 755 states: ‘Church’ and ‘Congregation.’ A church consists of those who are communicants, have made a public profession of religion and are united by a religious bond of common spiritual welfare. It is the spiritual body, not the legal one. But a religious society or congregation, under the statute, is a voluntary association of persons, generally but not necessarily in connection with a church proper, united for the purpose of having a common place of worship and to provide a proper teacher to instruct them in doctrines and duties, etc. [Citations omitted.]
- “Decisions interpreting ch. 91, Revised Statutes of 1878, make plain that failure of a church or religious organization to incorporate thereunder did not affect the power of the church or religious organization to hold title to property. “Under the repeated decisions of this court, we must hold that the mere fact that [a] church or religious society had not yet been incorporated at the time of the delivery of [a] deed in no way frustrated the trust thereby created, if such trust was otherwise valid.” Fadness v. Braunborg, 73 Wis. 257, 278-79, 41 N.W. 84, 90 (1889) (emphasis in original).
- “In Holm v. Holm, 81 Wis. 374, 382, 51 N.W. 579, 581 (1892), the facts included that the Norwegian Evangelical Lutheran Church of Roche-a-Cree was a voluntary association until February 7, 1889. The court noted that “[p]rior to that date the title to the churches in which the members of the association worshiped was vested in trustees named in . . . deeds, and their successors in office. . . . The trusts imposed by such deeds appear to have been valid upon the principles stated by this court in Fadness v. Braunborg. . . .” Id.
- “In Franke v. Mann, 106 Wis. 118, 131, 81 N.W. 1014, 1018-19 (1900), the court further said that ‘[w]hat has been said is in harmony with the law regarding trusts for religious uses, whether the trustees be officers of a religious corporation or of an unincorporated ecclesiastical body. . . .’ Id. at 131-32, 81 N.W. at 1019 (emphasis added).
- “It is plain from these decisions that the court did not consider that the legislature, by offering to ecclesiastical bodies the advantages of incorporation, intended to impose corporate structure upon such bodies. The property of unincorporated ecclesiastical bodies was commonly held in trust for the benefit of the members.
- “The Basic Bible Church established that title to the real estate subject to foreclosure was held in the name of the trustees for the benefit of the church. We conclude that the trust constituted an “entity” which could claim tax exemption under sec. 70.11(4), Stats., for the benefit of the Basic Bible Church.”