As many of you know (and some of you may not know), I am the Chancellor of the Diocese. Chancellor is just a fancy name for the Diocese’s lawyer. I succeeded our long-term Chancellor, Chip Dougherty in 2017.
In my work for the Diocese over the past six years several issues have arisen involving individual parishes that, because of their universal application, I think it makes sense for all of us to consider. First, I want to explain why Steve Abdow and I have been pestering you to provide me with the information I need to incorporate our individual parishes under the Commonwealth’s modern non-profit corporation statute, G.L. c 180. Over the last several decades banks particularly, but also other entities involved in business transactions, have come to require proof that a parish attempting to do business exists as a Massachusetts Religious Non-Profit Corporation in order for that parish to engage in the contemplated transaction.
Historically, a small number of our oldest parishes were incorporated by an Act of the Legislature specific to that parish. For such parishes I can prepare and file Restated Articles of Organization for the parish under G.L. c180. The rest of our parishes have historically been deemed corporations (but not G.L. c180 corporations) for the purposes of owning real estate or engaging in banking or other commercial transactions. Such entities are not recognized as corporations under G.L. c180 and do not appear in the database maintained by the Corporations Division of the Office of the Secretary of the Commonwealth on its website. Thus when banks or other entities require proof of a parish’s existence by the production of a Certificate of Legal Existence from the Secretary of the Commonwealth, the parish is unable to provide such proof.
Under Section 9 of G.L. c180 a parish can be established as a G. L. c180 corporation and its existence entered in the Secretary’s database by providing evidence to the Secretary in the form of an affidavit and supporting documentation (such as annual reports, vestry minutes and deeds) from its vestry (board of directors) that it has acted as a corporation over the years.
This is the project Steve and I have been working on. It is almost finished and I want to thank you for your responsiveness and your patience.
The second issue I want to bring to your collective attention is the canonical requirements relating to parish borrowing and the selling or encumbering of parish real estate or property. Most of you know, I am sure, that under our canons, both the Standing Committee’s and the Bishop’s approval is needed to sell parish real estate. Most of you also know, I am sure, that you need Standing Committee and Bishop approval to borrow money and mortgage parish property. What perhaps some of you don’t know is that you need both approvals to borrow money even if the borrowing is not secured by a mortgage or other encumbrance of parish property. For example, if a parish wants to establish an unsecured line of credit with a bank it needs to obtain Standing Committee and Bishop approval before doing so. Similarly, if a parish is encumbering its real estate in any manner—even if not by a mortgage—it needs Standing Committee and Bishop approval. For example, if a parish grants an easement across its property or leases all or a portion of its property to a third party it needs to obtain both approvals. I can help if you are in the position of needing those approvals, so feel free to reach out to me.
Finally, it has come to my attention that many parishes allow outside groups to use their facilities. In every such instance the parish needs the scope and limits of such use to be specifically spelled out in a written document in the form of a “Use Agreement” or “License Agreement”. Such agreements are not encumbrances that require approval from the Standing Committee and the Bishop. Nevertheless, they need to be in writing. If you reach out to me, I will be able to provide you with appropriate forms for such agreements. It is very important however, that parishes that allow outside groups to use their facilities notify their insurance carrier of such use.
If any of you have any questions or need assistance please don’t hesitate to reach out to me.
