NASHVILLE (ABP) — New Orleans Baptist Theological Seminary, the lone holdout in a lengthy SBC attempt to gain stronger control over its entities, is under increasing pressure to change its charter to make the SBC the “sole member” of its corporation.
The seminary's trustees voted in their Oct. 6-8, 2003, board meeting to decline an earlier request to make the SBC its sole member.
Following two hours of detailed and often repetitive discussion, the SBC Executive Committee voted Feb. 17 to officially request that the NOBTS trustees reverse course and amend the seminary charter during their spring 2004 meeting to make the SBC its sole member. The motion asks that the action be forwarded to the Executive Committee “for subsequent recommendation” to the SBC during its June 2004 meeting.
If the NOBTS trustees again decline to comply, the Executive Committee could ask SBC messengers to approve a motion to make the same request. If that happens, NOBTS president Chuck Kelley said, the trustees would comply.
The “bottom line” is that he and the trustees understand that the seminary is owned by the SBC, Kelley said. “If the Southern Baptist Convention asks all of its entities to do this, if they make their recommendation to New Orleans Seminary, then New Orleans Seminary is going to do it.”
But, Kelley said, he would prefer the option of working out alternative changes to the charter that would address the same concerns.
“Sole membership” is a legal term pertinent to non-profit corporations. Naming the SBC as sole member allows the convention to control the election and dismissal of entity trustees while granting the trustees authority to direct the organization's work and financial affairs. The requested changes grant the SBC nine specific powers designed to thwart any possible attempt trustees might make to withdraw from the SBC fold, as trustees of some state convention entities have done.
Naming the SBC as sole member also decreases the convention's level of liability for any debts or lawsuits incurred by the entities by creating a “statutory immunity” for the SBC, said convention attorney Jim Guenther.
The move toward asking entities to adopt the “sole member” provision began in 1995, when officials charged with reorganizing the North American Mission Board sought to bring its articles of incorporation into line with current law. NAMB adopted language naming the SBC as its sole member in 1996.
Executive Committee President Morris Chapman sent a memo to all entity heads in Sept. 1997, requesting that they follow suit. The International Mission Board and the Ethics and Religious Liberty Commission adopted the language in 1997, followed by LifeWay Christian Resources and Southern Baptist Theological Seminary in 1998.
The Annuity Board, Golden Gate Baptist Theological Seminary, Midwestern Baptist Theological Seminary and Southwestern Baptist Theological Seminary made the requested change in 1999. When Southeastern Baptist Theological Seminary joined the list in 2000, NOBTS remained the sole entity that had not adopted the SBC as its sole member.
Kelley said the seminary trustees are sympathetic to the Executive Committee's concern and are committed to the same goal of clarifying the school's relationship to the SBC. Trustees have been disinclined to make the change, he said, because they consider it a violation of Baptist polity, and because peculiarities of Louisiana law could cause the SBC to become more liable, rather than less, if it becomes the seminary's sole member.
Concerning polity, Kelley said his concern is not about the present but the future. “What would happen if there were an Executive Committee controlled by moderates who would have a desire to undo the conservative resurgence or take Baptists in a different direction?” he asked.
“We felt like this was a step in a direction that would make it possible for some things to happen in Baptist polity that have not been possible or would be very difficult before,” Kelley said. “My concern is not the size of the step, but the direction of the step,” he said later.
As another policy concern, Kelly said the Executive Committee seems to be more interested in directing the seminary than advising it, and is unwilling to hear counter proposals from the seminary trustees.
The seminary hired Richard Wolfe, an expert in Louisiana corporate law, as a consultant, Kelley said. Wolfe advised the trustees that protections for the SBC as spelled out in the seminary's current charter would be sustained by Louisiana law, Kelley said, while changing to a sole membership arrangement might weaken the SBC's position as it relates to liability. Wolfe passionately believes the move would increase liability for the SBC in the case of an ascending liability lawsuit, Kelley said.
Guenther disagreed, insisting that making the SBC the sole member for NOBTS would grant statutory immunity to the convention. Louisiana law recognizes directors and members of corporations, Guenther said, and the current arrangement names the trustees as both directors and members, leaving the SBC as a third party, with no legal governance.
Guenther said the convention's goal is “to give the Southern Baptist Convention the inalienable right to elect the seminary's trustees.”
“The Southern Baptist Convention means to have the right to elect the trustees as long as the convention chooses to do so,” he said. “The convention wants to make certain that the seminary is legally tied to this convention and that the seminary could not at some time in the future declare its independence from the convention, as has occurred in the state convention arena.”
Spelling out the rights of the SBC is necessary, Guenther said, because “there are several strategies by which a board might undertake to flee convention control.” Guenther cited potential strategies and said “there are several gates to the institutional corral, which must be kept locked, and the convention must have the right to control those gates.”
Guenther explained that the nine specified rights included in the request give the SBC power to appoint and remove trustees, along with the right to approve any changes in the charter and any merger, consolidation, dissolution, sale or lease of a majority of assets, or creation of a subsidiary corporation.
Kelley said the issue involves two groups who love Southern Baptists who are looking at a complicated issue and seeing it differently.
Kelley was questioned by several Executive Committee members, who had been given more than 140 pages of documents detailing the lengthy negotiations between the Executive Committee and NOBTS.
Bruce Martin of North Carolina questioned Kelley's concern that the seminary seemed to want the option to leave the convention if the SBC should became more moderate. “If you have the option to walk away 50 years from now, then you have the option to walk away today,” Martin said. “We as Southern Baptists have the responsibility to make sure you don't have that walk-away option.”
Kelley said he did not believe the trustees have such an option now, and are not trying to leave themselves a loophole for the future.
When the question finally came to a vote, the Executive Committee approved the motion overwhelmingly, with two opposing votes.
Afterward, Kelley said he had hoped to be able to find a different resolution that would please both the SBC and the seminary. “I regret that they weren't patient enough to allow an entity to finish the process,” he said. He predicted the seminary trustees will not act on the Executive Committee's request but will wait for SBC messengers to make the request. Then, he said, “I guarantee they will revisit the issue.”
-30-