Breakaway entities' 'legal magic' challenged by Michael Whitehead
May 17, 2002
By Don Hinkle

JEFFERSON CITY, Mo. (BP)--It does not take a room of Philadelphia lawyers to understand the concerns Missouri Baptist Convention leaders have with five entities' trustee boards who have voted to become self-perpetuating, according to the legal adviser to the MBC's legal opinion task force.

"Is anyone willing to print the facts and law so Baptists can know the truth?" asked attorney Michael K. Whitehead in an opinion article titled, "Missouri Baptist Convention and the Incredible Vanishing Corporations."

Whitehead, in the article, cited the charter of The Baptist Home, one of the five entities (the other four are the Missouri Baptist Foundation, Word & Way newsjournal, Windermere Baptist Conference Center and Missouri Baptist College) whose trustees have voted to amend their charters to give their trustees sole power to pick their successors, thus removing MBC churches from the process.

The Baptist Home charter states, "This corporation shall be affiliated with and subject to the Missouri Baptist Convention. The members of the Board of Trustees of this corporation shall be nominated and elected by the Missouri Baptist Convention at the Annual Meeting of said Convention and shall automatically be removed upon withdrawal of the approval by the Missouri Baptist Convention or the Executive Board of Missouri Baptist Convention."

Whitehead further noted from the charter: "This agreement of the corporation may be amended by an affirmative vote of two-thirds of the members of the Board of Trustees at any meeting of the said Board of Trustees provided written notice of the amendment and the proposed wording thereof is mailed to each Trustee at least 30 days prior to the date of said meeting by the Secretary of the corporation, and provided said Amendment is approved by the Missouri Baptist Convention."

"Now," Whitehead wrote in his article, "it doesn't take a room full of Philadelphia lawyers to explain the meaning of the words 'provided said amendment is approved by the Missouri Baptist Convention.' And even a room full of Philadelphia lawyers cannot hide the meaning."

Yet, Whitehead observed, Baptist Home lawyers think they have found a loophole, citing a 1995 Missouri statute, 355.606, which states: "The articles may require an amendment to the articles or bylaws to be approved in writing by the specified person or persons other than the board. Such an article provision may only be amended with the approval in writing of such person or persons."

Baptist Home lawyers have noted that the 1960 Baptist Home charter requires MBC approval but fails to use the phrase "in writing" like the 1995 statute and thus "violates" the 1995 statute, rendering the charter clause void and giving the board the power to amend its charter without the approval of the MBC, written or not.

"Now that's legal magic," Whitehead wrote. "Five corporations worth nearly $100 million just disappear from the control of the MBC because of a wonderful loophole in the law. That's better than David Copperfield's trick of making the Statue of Liberty vanish."

Baptist Home lawyers, Whitehead wrote, have overlooked another piece of the statutory puzzle: The charter gives the MBC the right to vote for the institutions' leaders because they are "members." He notes that the Missouri Non-Profit Corporation Code defines "member" as follows: "Member, without regard to what a person is called in the articles or bylaws, any person or persons who on more than one occasion, pursuant to a provision of a corporation's articles or bylaws, have the right to vote for the election of a director or directors."

Local church members have ultimate control over their governing documents, Whitehead wrote, and likewise, in a Missouri nonprofit corporation, the charter cannot be amended without approval of the members.

"The statutes say that a member is anyone who has the right to elect trustees," Whitehead wrote. "MBC had the right to elect trustees of all five agencies. That makes the MBC the 'sole member' of each of the agencies. That means the agencies can't amend their charters without MBC approval.

"The Baptist Home argument reminds us of a quote by another famous Baptist lawyer who said, 'That depends on what the definition of is, is,'" Whitehead wrote in quoting former President Bill Clinton's famous answer when quizzed about his affair with Monica Lewinski. "Law and common sense tell us that statutes cannot be applied retroactively to take away the substantive rights of the Missouri Baptist Convention. The MBC approval clauses in the charters would doubtless be upheld as lawful and binding, and 355.606 would be interpreted to require approvals to be in writing. Hence the putative amendments were invalid because MBC did not approve in writing, but expressly disapproved in writing."

Whitehead urged Missouri Southern Baptists not to get distracted from the central issue.

"The agencies don't want to talk about the above facts and statutes, but want to shift the focus onto several side issues. Keep your eye on the ball: the charters and statutes say that the agencies cannot legally amend their charters without MBC approval," he wrote.

What side issues?

Whitehead noted how the entities produce press releases attacking the MBC for its press releases. That is like "the pot calling the kettle black," he wrote. "These are not private businesses with the right to keep secrets from Missouri Baptists. But keep your eye on the ball: the charters and statutes say that the agencies cannot legally amend their charters without MBC approval."

Another side issue involves the entity heads clamoring to see the letters from the three law firms hired by the MBC, yet they will not disclose their lawyers' letters.

"In fact, the five agencies have not publicly released any of the correspondence between their attorneys and the agencies over the past several years when this conspiracy was being planned," Whitehead wrote. "They consider that to be 'attorney-client' privileged information. As the old saying goes, 'what's good for the goose is good for the gander.' But keep your eye on the ball. The ball is not what the lawyers say in private to their clients about legal strategy. The ball is: the charters and statutes say that the agencies cannot legally amend their charters without MBC approval."

According to Whitehead, the entities would have Missouri Southern Baptists to believe that the self-perpetuating issue is too complicated for them to understand. He referred to the entities' open letter charging that the legal opinion obtained by the MBC is "superficial."

"The agencies want us to believe that their actions were clearly legal, if only we understood the law," Whitehead wrote. "So help us understand the law. The charters and statutes say that the agencies cannot legally amend their charters without MBC approval."

The entities have implied that "their legal analysis is very deep, very sophisticated, and not capable of simple explanation," Whitehead wrote.

"Law is not just for the lawyers. Laws are written to be understood and obeyed by all citizens," he wrote. "And these laws are not hard to understand -- or to obey -- unless you are looking for loopholes, to try to do some fancy 'legal magic.'"

Whitehead also noted how the trustees at the five entities have defended their actions by saying they did so in order to protect the entities from liability issues.

"Nothing about this legal theory can justify secret votes to become self-perpetuating. If this was a genuine concern, bring it to the MBC and recommend charter changes," Whitehead wrote.

Identifying another side, Whitehead wrote that the entities' heads and trustees have portrayed themselves as innocent victims, that there is much "wailing and gnashing of teeth" by the entities over the "inflammatory rhetoric" in the legal opinion obtained by the MBC.

"They give no examples of flaming barbs," Whitehead wrote. "Apparently they take offense to the words 'violation of 355.066 and 355.606.' And they don't like the tone of the recommendation that the agencies should give back control of the MBC agencies to the MBC.

"The MBC legal task force report is not filled with inflammatory rhetoric," Whitehead wrote. "It is factual and straightforward. The problem is that the concerted taking of these five corporations is so outrageous that the report may sound inflammatory when it just describes the facts."

It is the entities themselves that have used inflammatory rhetoric, Whitehead wrote, reminding them of their threats to have Missouri Baptist Convention trustees arrested for criminal trespassing if they just showed up at a November board meeting at one entity. Also, in March, entity lawyers threatened to sue the MBC and executive board members individually to force them to turn over all escrowed funds.

It is time for entity heads and trustees to show some courage, Whitehead wrote. "Some agency trustees based their vote on legal advice they received. They sincerely believed they were following the law. Now they see the ball more clearly: the charters and statutes say that the agencies cannot legally amend their charters without MBC approval.

"Even if they think that self-perpetuating boards are a good thing for the agencies, you cannot do right by doing wrong."