A Building Deeded to the Pastor, $80,000 in Back Taxes and a Lost Foreclosure Fight: A Church Loses Its Property

• The First Church of God in Christ lost a Warren Street building in Hudson, New York
• About $80,000 in back taxes dating from 2008 led to foreclosure in 2012
• The property had been transferred to the pastor, Godfrey Forbes, in 1985
• An appeals court said the public record did not show the church had any interest

A church in upstate New York has lost its fight to undo the tax foreclosure of a downtown building, Courthouse News Service reported in March 2014.

The property, a mixed-use building on Warren Street in the business district of Hudson, a small city on the Hudson River about two hours north of New York City, had shops on the ground floor and apartments above. It was foreclosed on in 2012 over about $80,000 in back taxes dating from 2008.

The First Church of God in Christ asked the courts to set the foreclosure aside, arguing that the property was really the church’s. But in 1985 the building had been transferred to the pastor, Godfrey Forbes, and he, not the church, was the owner listed on the tax rolls. The court found that the 1985 transfer was invalid because it lacked the court and state attorney general approval required under nonprofit law. Even so, the city had properly notified Forbes as the listed owner, and that was enough.

“On its face, the public record here did not disclose that petitioner had any interest in the property,” the appellate panel of the Third Judicial Department said, as it affirmed the lower court’s refusal to reverse the foreclosure.

The case is a hard lesson in how title works. A church may believe a building is its own, but if the deed is in an individual’s name and the taxes go unpaid, the tax collector and the courts deal with the name on the record. An invalid transfer did not save the building; it only meant the church had never properly held it.

Jamaican congregations should take note. Property held in a pastor’s or trustee’s personal name, and property taxes left unpaid, are two of the fastest ways to lose a church building. Churches should check that titles are in the name of the church or its registered trustees, keep property tax receipts filed, and get legal advice before any transfer of church land to an individual.

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