An attorney for Armstrong Teasdale LLP, legal counsel for the former board of the Missouri Baptist Foundation, is seeking to stop action taken earlier this week by the Missouri Baptist Convention and its MBC-elected trustees on the Foundation board.
On Jan. 27 the MBC announced it had taken the legal steps necessary to seat the duly elected trustees, restoring governance of the Foundation to the MBC-elected board after more than a decade of control by a self-perpetuating board.
The next day, Larry Tucker of Armstrong Teasdale LLP notified the MBC that his firm is seeking to prevent the convention from following through on these steps, despite the Oct. 1, 2014, final judgment by the Circuit Court of Cole County, which empowered MBC-elected trustees to assume immediate governance of the Foundation, even during an appeal. Tucker argued it was not final, even though it was titled “final judgment.”
Tucker filed a motion in the Court of Appeals in Kansas City, asking for an order staying the October judgment and stopping the MBC’s action to seat the MBC-elected board. This was his second motion seeking a “stay of execution.” He filed a similar motion Oct. 31, 2014, which the appeals court denied on Dec. 8.
MBC’s legal counsel is filing a response to Tucker’s motion in the appeals court.
The lawful board
According to the Circuit Court of Cole County, the former trustees were effectively removed on Oct. 1 and are not legally entitled to take any action for or on behalf of the Foundation. Only MBC-elected trustees comprise the lawful board, pending appeal, as MBC legal counsel interprets the judgment.
The appeals court has not yet ruled on Tucker’s second motion for a stay.
Meanwhile, MBC Executive Director John Yeats made it clear that the MBC-elected board is “working with all deliberate speed through a stable process that ensures all funds are protected, the staff is properly evaluated, and the Foundation continues to operate with maximum accountability and effectiveness.”
Yeats further stated, “I encourage all Missouri Baptists to pray for us as we take these important steps to return governance of the Foundation to the MBC. I envision a great future for this ministry.”
A legal last resort
In 2001 the board of the Foundation broke away from the MBC, changing its charter in violation of charter language and MBC bylaws, and declaring its board self-perpetuating. After months of seeking non-judicial resolution and even offering binding Christian arbitration – all of which the self-perpetuating board rejected – the MBC sought legal action as a last resort to return the Foundation to Missouri Baptists.
A number of court decisions in the MBC’s favor followed, most recently a decision by Senior Circuit Judge Frank Conley, ordering the Foundation to return governance to the MBC. He also awarded the MBC $5.2 million in legal costs and interest, which judgment the Foundation’s insurer, Church Mutual Insurance Company, settled with the MBC, remitting $5 million on Jan. 6.
The MBC-elected trustees took the action to be seated now, rather than waiting for an appeal by the Foundation to run its course, to fulfill its fiduciary responsibility to Missouri Baptists and Foundation clients since the Circuit Court ruling ordered the Foundation’s self-perpetuating trustees to vacate their positions, according to Mike Whitehead, the MBC’s legal counsel.
Since Oct. 1 the Foundation has taken no action to obey the court’s ruling, said Whitehead. Further, the Foundation appealed the Oct. 1 ruling on Oct. 10 but did not post a supersedeas bond, which might have stayed the ruling pending appeal.
“The Foundation chose not to seek a stay of the judgment before appealing,” said Whitehead. “This means that, legally, the Convention’s duly-elected trustees are responsible for the governance of the corporation pending appeal, by the terms of the court’s orders.”
The MBC’s Yeats expressed gratitude that the courts have established the convention’s right to seat board members duly elected by Missouri Baptists. “We believe these court decisions set a precedent that enables us in time to recover the Baptist Home and Missouri Baptist University. Our desire is to welcome all of our agencies back into the MBC family while ensuring a smooth transition of governance.”