By Chris Bankler

When disputes arise within religious organizations, courts are often asked to decide questions that implicate both civil law and religious liberty. Sometimes they must step in. Sometimes the First Amendment requires them to step aside.

Two recent Texas Business Court opinions illustrate where that constitutional line is drawn. In Sri Shirdi Sai Baba Temple of Austin v. Lam, Judge Melissa Andrews concluded that the court could resolve a dispute over a temple’s governing documents because it presented a straightforward question of Texas corporate law. In Jeremiah Counsel Corp. v. Young, Judge Grant Dorfman reached the opposite conclusion for many of the claims before him—not because the dispute involved a church, but because deciding those claims would require the court to evaluate religious purpose and second-guess core church governance.

Together, the opinions provide a practical illustration of the church-autonomy doctrine at work. The question is not whether the dispute involves a church. The question is whether the particular claim can be decided by applying neutral principles of law without requiring the court to decide questions of faith, doctrine, or church governance.

Background

The two cases arose from very different disputes.

In Sri Shirdi Sai Baba Temple, the controversy concerned the governance of an Austin Hindu temple organized as a Texas nonprofit corporation. The Temple had long operated under a certificate of formation identifying it as a board-managed nonprofit corporation with no members. In 2025, however, one faction adopted bylaws purporting to convert the Temple into a member-managed corporation by vesting governance authority in the Temple’s General Body of Trustees. Before those changes could be reflected in an amended certificate of formation, competing boards claimed authority to govern the Temple, adopted conflicting resolutions, and filed competing documents with the Texas Secretary of State. The resulting lawsuit asked the Business Court to determine which governing documents controlled.

In Jeremiah Counsel, the dispute arose out of sweeping governance changes at Houston’s Second Baptist Church. For decades, Church members possessed significant voting rights, including the ability to elect deacons and vote on amendments to the Church’s governing documents. In 2023, the Church adopted amendments eliminating those voting rights and transferring authority to a self-perpetuating Ministry Leadership Team. An association of current and former Church members challenged not only the amendment process itself, but also subsequent actions taken under the new governance structure, including claims for fraud, breach of fiduciary duty, conversion, and challenges to the transfer of The Winning Walk ministry to retiring Senior Pastor Ed Young.

Those different factual settings ultimately drove the courts’ analyses. The Temple case presented a relatively narrow dispute over corporate governance documents. The Second Baptist litigation asked the court to review not only the validity of corporate amendments, but also the truthfulness of religious statements, internal leadership decisions, and the exercise of ecclesiastical authority.

The Court’s Rulings

Judge Andrews concluded that the Temple dispute presented a corporate-law question that could be resolved through neutral principles of Texas corporate law rather than ecclesiastical inquiry.

“The Court applies neutral principles of Texas corporate law and concludes that the provision of the 2025 Bylaws purporting to place corporate governance in hands of the trustee-members, rather than the board of directors, directly conflict with the Temple’s elections in its Certificate of Formation, and the certificate controls over the conflicting provisions of the bylaws.”

Because the certificate of formation had never been amended, the Temple had not completed the statutory process for changing its corporate governance structure.

“Ultimately, the dispute before the Court is one of corporate management that does not hinder the Temple’s self-governance, and the Court need not and does not resolve any ecclesiastical issues to decide it.”

“The Business Organizations Code answers that question and does not interfere with the Temple’s ability to elect to be member managed. It was the Temple that elected to be board managed in the first place, and the process for changing that election is both simple and neutral.”

Judge Dorfman applied the same framework claim by claim. He concluded that the court could resolve statutory questions concerning the validity of the Church’s governing documents, but that other claims required abstention because they would entangle the court in matters of religious doctrine and internal church governance.

“In short, and at minimum, for a court to evaluate the truth or sincerity of Defendants’ statement of religious purpose for the May 31, 2023, vote would inextricably intertwine church and state in a doctrinal inquiry that is inconsistent with the religious liberty safeguarded by the United States and Texas Constitutions.”

That same reasoning led the court to abstain from claims challenging leadership decisions and the transfer of church property.

“Whether this was a fit honorarium for a retiring Senior Pastor’s decades of salutary service or, conversely, ‘waste’ of corporate assets in violation of the MLT’s fiduciary duties to the Church, is a judgment question best left to believers, not to a secular court constrained to apply only neutral principles of law.”

“The Court acknowledges that this conclusion will likely engender disappointment and frustration, if not far stronger reactions than that. It may strike many as unfair, or even as a dereliction of duty by the Court. That was not the Court’s intention, but is a perhaps inevitable result of the church autonomy doctrine and the centrality to our country, our Constitutions, and to our people of the principle of religious freedom that it protects.”

Takeaways

These opinions provide a practical illustration of how Texas courts apply the church-autonomy doctrine. Judge Andrews demonstrates that courts may resolve disputes involving religious organizations when they can do so by applying neutral principles of corporate law. Judge Dorfman demonstrates the equally important limit: once a claim requires a court to evaluate religious purpose, theological meaning, or core church-governance decisions, the Constitution may require the court to abstain.

Taken together, the opinions reinforce a simple principle: the question is not whether the dispute involves a church. The question is whether the court can decide the particular claim without deciding religious questions.

The opinions expressed are those of the authors and do not necessarily reflect the views of the firm, its clients, or any of its or their respective affiliates. This article is for informational purposes only and does not constitute legal advice. For more information, please contact Chris Bankler or a member of the Trial & Appellate Litigation practice.

Meet Chris

Chris Bankler focuses on the resolution of disputes for businesses and financial institutions. He counsels clients through the process of complex business litigation, including general business disputes, fraud claims, breach of fiduciary duty cases, and complex business bankruptcy litigation. He has served as litigation counsel in more than 100 cases in state and federal courts, as well as FINRA and AAA arbitrations.