{"id":17253,"date":"2015-01-06T09:51:41","date_gmt":"2015-01-06T15:51:41","guid":{"rendered":"http:\/\/megaphonedesigns.com\/~pathway\/?p=17253"},"modified":"2015-01-14T08:51:43","modified_gmt":"2015-01-14T14:51:43","slug":"breaking-mbc-to-receive-5-million-partial-settlement-in-foundation-case","status":"publish","type":"post","link":"https:\/\/mbcpathway.com\/2015\/01\/06\/breaking-mbc-to-receive-5-million-partial-settlement-in-foundation-case\/","title":{"rendered":"UPDATED: MBC to receive $5 million partial settlement in Foundation case"},"content":{"rendered":"

JEFFERSON CITY \u2013\u00a0<\/strong>The Missouri Baptist Convention has received a $5 million partial settlement in its legal efforts to restore the Missouri Baptist Foundation as an entity accountable to the convention.<\/p>\n

The foundation was one of five subsidiary corporations which broke from the convention in 2000-01, changing their charters to create self-perpetuating trustee boards.<\/p>\n

The MBC Executive Board approved a $5 million payment from Church Mutual Insurance Company in an executive session during its Dec. 8-9 meeting in Jefferson City. The settlement with Church Mutual, to be applied toward financial losses and attorney’s fees accrued by the convention, represents the policy limits of $5 million in insurance carried by the Missouri Baptist Foundation.<\/p>\n

MBC legal counsel Michael Whitehead and Church Mutual, the insurer for the foundation, reached an initial agreement Dec. 5. The company remitted the $5 million payment to the Missouri convention Jan. 6.<\/p>\n

The settlement apparently completes Church Mutual’s financial obligation to indemnify the foundation on a $5 million policy of Director and Officer’s Liability Insurance, under which the insurance company also has been paying most of the foundation’s costs and legal fees to fight the MBC’s recovery efforts since 2002.<\/p>\n

At the same time, the settlement agreement allows the MBC to proceed with legal efforts to restore governance of the foundation to a convention-elected board of trustees, which will operate under the pre-2001 corporate articles. It also permits the MBC to continue efforts to restore Missouri Baptist University and The Baptist Home retirement center to the governance of convention-elected trustees.<\/p>\n

Last June, Circuit Court Senior Judge Frank Conley ruled that the foundation must pay the MBC more than $4 million in costs and legal fees that the convention incurred seeking to restore its governance after the foundation board’s 2001 vote to amend its charter to become self-perpetuating without MBC approval.<\/p>\n

The court also awarded pre-judgment and post-judgment interest, estimated at roughly $1.2 million. Post-judgment interest has accrued at 9 percent per year, or roughly $1,000 per day. The foundation continues to dispute the interest calculation and attorney’s fees award in the court of appeals, but Church Mutual agreed that its settlement payment is based on any and all financial losses claimed by the convention, not just the fee award.<\/p>\n

A motion by the foundation asking Judge Conley to amend the judgment was denied on Oct. 1. The foundation has appealed the ruling to the court of appeals in Kansas City. If the appeals court upholds the ruling in the convention’s favor, as expected, the foundation may appeal to the Missouri Supreme Court. Regardless of any ruling by the appeals court, Church Mutual has agreed that the MBC will retain the $5 million settlement.<\/p>\n

The convention attempted mediation with Church Mutual and the foundation in late January 2014 but reached an impasse over the issue of governance. According to John Yeats, the MBC’s executive director, the matter of historic Baptist trusteeship is non-negotiable with Missouri Baptists, as is the right of the convention to approve all charter changes.<\/p>\n

With the foundation case, the court has concurred three times, before three judges, in favor of the convention on these key issues.<\/p>\n

“We are grateful for the settlement with Church Mutual on behalf of the foundation, which enables us to recover most of the legal fees incurred in our efforts to restore the foundation to the MBC family,” Yeats said. “As we have always maintained, we gladly welcome back the foundation if it seats the duly elected trustees and returns to its corporate charter in which Missouri Baptists, not independent boards, govern its ministry. With God’s grace, we are much closer today to reconciliation.”<\/p>\n

In news last year regarding the Windermere Baptist Conference Center, one of the other breakaway entities that had been a part of the MBC since 1957, the convention purchased from a third party approximately 970 acres of land that formerly had been owned by Windermere.<\/p>\n

The MBC executive board’s redemption of 75 percent of the conference center’s original 1,300 acres last June followed a recommendation by a board-appointed study group. The land features about 8,000 feet of shoreline on the Lake of the Ozarks surrounding approximately 350 acres upon which Windermere’s conference facilities sit.<\/p>\n

The MBC bought back the 970 acres from a mortgage holder at a deeply discounted price of $1.6 million, with reserve funds used for earnest money and financing provided by the Baptist Foundation of Oklahoma.<\/p>\n

The purchase price was significantly less than the $4.45 million mortgage held by the lien holder, Desert Capital REIT, which acquired the acreage at a foreclosure sale following the bankruptcy of a company held by the now-deceased developer William Jester of Springfield, Mo.<\/p>\n

Windermere had deeded the acreage to a lender in 2005 as part of an effort to restructure its debt. Jester bought the land from the lender, obtaining a mortgage loan from another lender. He later defaulted on the new loan, and the lender foreclosed the mortgage. The convention bought the land from the final lender. Court filings in 2010 listed the land’s value at $11.7 million.<\/p>\n

The convention’s purchase of the acreage is called the Windermere Wilderness Redemption Project, Yeats said, “because we are redeeming — or buying back — land that once belonged to Missouri Baptists \u2026 and ultimately to the Lord. It is an act that we believe illustrates the faithfulness, and sacrificial work, of our great God.”<\/p>\n

Yeats said at the time that the MBC executive board would be evaluating the land’s potential toward recommending a plan for its future use.<\/p>\n

Convention court action continues toward recovering the Missouri Baptist University and The Baptist Home retirement center but not the fifth breakaway entity, the Word & Way newsjournal.<\/p>\n","protected":false},"excerpt":{"rendered":"

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