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Scott E. Mollen

Contracts-Religious Corporation Sale of Property—“Outsiders” Tried To Take Over the Congregation—Congregation’s Request for Approval To Sell Its Property Denied—By-laws Were Never Amended And Not Followed—They Were Deemed to be Abandoned

Petitioner congregation “A,” a religious corporation, sought judicial approval of the sale of its property (property) to a purchaser (purchaser). The sale price was $13 million. The petitioner was to retain “a long-term lease for office space in the building at $10 per year.” Three million dollars of the proceeds were to be used “as a reserve for the continued operation” of the congregation’s activities, “to be controlled by petitioner’s president, [‘B’].” Approximately $10 million was to go to organization [“C”], for the construction of a new synagogue in Jerusalem.

The petitioner had filed an original petition and an amended petition. The petitions “contradict[ed] each other” as to how the sale was authorized by petitioner and contained “many unexplained inconsistencies.” They included different sets of unsigned and undated by-laws, “and sought to have the court approve the sale based on completely different theories.” “B” had verified both petitions as President and presiding clergyman, but he changed his title “in the amended petition to reflect petitioner’s new theory of approval and new amended by-laws.”

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