Committing Our Hearts to Excellence Texas Baptist Church Weekday Education Association Director s Retreat. April 21, 2005 Stagecoach Inn Salado, Texas

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1 Keeping Your Church Out Of Court Committing Our Hearts to Excellence Texas Baptist Church Weekday Education Association Director s Retreat April 21, 2005 Stagecoach Inn Salado, Texas Materials Prepared By: Bourland, Wall & Wenzel, A Professional Corporation 301 Commerce Street Suite 1500 Fort Worth, Texas Telephone No. 817/ Facsimile No. 817/ General Counsel To Tarrant Baptist Association, Inc. And Trust and Estate Counsel to Baylor University 2005 Bourland, Wall & Wenzel, A Professional Corporation

2 DARREN B. MOORE Bourland, Wall & Wenzel, P.C. 301 Commerce Street, Suite 1500 Fort Worth, Texas Mr. Moore's practice focuses on the areas of general litigation and representation of nonprofit organizations. In his litigation practice, he represents both plaintiffs and defendants in cases involving a wide array of claims. Mr. Moore represents clients before state and federal trial and appellate courts as well as various alternative dispute resolution forums including mediation, arbitration and Christian conciliation. Mr. Moore s nonprofit practice is concentrated on the representation of religious professionals and religious organizations. He advises clients on a wide range of matters including organization of various types of religious entities, obtaining and maintaining tax exempt status, risk management, employment and human resources issues, and various other business issues. Relevant Experience Frequent speaker to churches and church leaders on avoiding legal liability in Texas, Louisiana, Mississippi and Georgia Adjunct Professor, Baylor School of Law, 2000-present. Course: Nonprofit Organizations Author of the seminar article, Liability Issues For Religious Organizations and Religious Professionals Author of the seminar article, Keeping Your Church Out of Court: Avoiding Legal Landmines When Communicating Author of the seminar article, Employment Law Primer for Churches Author of the seminar article, A Brave New World: Nonprofit Entry into the Commercial Marketplace Author of the seminar article, Selected Employment Law Issues for Churches Author of the seminar article: Setting Up Your 501(c)(3) Organization Author of the seminar article: Get In, Get Out, Get on with Your Life: Avoiding Fiduciary Litigation and Weathering the Storm When You Can t Author of Preventing Sexual Harassment in the Church, FYI, Lifeway Publishers Church Secretary Newsletter, Fall 2002 Baylor Law Review, Editor in Chief, Background & Education Born in Lubbock, Texas B.A. Texas A&M University, Cum Laude J.D. Baylor University, Magna Cum Laude Admissions & Certifications Admitted: 2000, Texas 2001, U.S. District Court, Northern District of Texas 2001, United States Tax Court Membership State Bar of Texas Texas Young Lawyers Association, Co-Chair, Texas Law for Texas Clergy Committee, 2001 Tarrant County Bar Association Fort Worth Tarrant County Young Lawyers Association Baylor Law Alumni Association Christian Legal Society Personal Married to Terri Darby Moore Father of Jacob Andrei Moore

3 I. Avoiding Liability from Personal Injury Claims Page 1 of 7 A. Types of Liability. 1. Negligence: Occurs when the actor fails to exercise a level of care that a reasonably prudent person would exercise under the same or similar circumstances. 2. Intentional Torts: Arises when an actor intends the injury complained of. B. Negligence Claims: These arise when an actor breaches a duty owed to another that causes injury to the other person. These duties are prescribed by law, and negligence may occur in any of a number of everyday activities (e.g., failing to sweep snow from the steps of the church, thus causing a person to slip and fall; failing to fix a broken piece of playground equipment that causes injury to a child playing on the equipment). The exercise of good faith (i.e., the actor did not intend the result) is not a defense to negligence. 1. Direct Liability: An actor incurs direct liability when the actor is personally responsible for his or her conduct. 2. Vicarious Liability: An employer may become liable for the acts of an agent when an agent acts within the scope and course of the agent s responsibilities. A church/ministry may be vicariously liable for the negligent acts of a volunteer or employee of the church if the volunteer or employee were acting within the scope and course of his or her responsibilities. a. The agent must act within the scope of his or her general authority and in furtherance of the employer s business and the accomplishment of the object for which the employee was hired. b. Vicarious liability generally only arises from negligent conduct by an agent. If an agent commits an intentional tort (e.g., assault, false imprisonment), then this is generally considered to be beyond the scope of the agent s responsibilities. However, the employer may still be liable under another theory, such as negligent supervision or negligent hiring. C. Other Forms of Tortious Conduct 1. Negligent Hiring: This may arise if the church/ministry hired a person whom the church/ministry knew or should have known that was prone to commit a tortious act. Exercise of due diligence in the hiring process is thus important to avoid liability because it may demonstrate that the church/ministry acted in a reasonably prudent manner in hiring the employee.

4 2. Negligent Retention: Similarly, if a church/ministry gains information that an employee or volunteer has the propensity to commit a wrongful act, then the church has a duty to dismiss the individual. 3. Negligent Supervision: A church/ministry may be liable if it fails to supervise its employees or volunteers adequately, and an employee s or volunteer s conduct causes injuries to another. 4. Premises Liability: Liability that arises from the ownership or lease of property. If a person who uses church property is injured, the landowner/lessee may be liable under a number of different theories. II. Avoiding Liability from Hiring Practices A. Hiring Practices: Implementation of consistent hiring practices is important to protect the church/ministry against allegations of discriminatory or negligent hiring. A church/ministry should have two goals when developing a screening process for hiring employees: (1) to create a process by which the church can remove from consideration any applicant against whom there is some evidence of a propensity to commit acts of misconduct; and (2) to create a personnel file for each employee and volunteer to document the due diligence the church undertook into that individual s background prior to the individual beginning work at the church and thereafter. 1. Job Descriptions a. Accurately establishes the duties and responsibilities of that position. b. Establishes minimum qualifications for each position. The church/ministry should only interview those who meet these minimum qualifications. 2. Written Applications a. Every applicant should complete a written application. This helps demonstrate due diligence in screening potential employees, allows the church/ministry to determine an applicant s qualifications, and ensures that no evidence suggests that the applicant may commit an act of misconduct. The church/ministry should read each application carefully before proceeding. b. The church/ministry should develop a standard job application. This should only ask questions related to the position. c. The church/ministry should not discriminate on the basis of race, color, sex, age, or national origin, so the application should not contain questions that would obtain such information. Page 2 of 7

5 d. The church/ministry should only accept applications for positions that the church is trying to fill. e. The church/ministry should not accept a resume in lieu of an application. f. The screening process should begin with the completion of the job application. 3. Criminal Background Checks: There are a number of different methods for conducting criminal background checks on prospective employees. a. District and County Clerks Offices: This is the least expensive but most restricted method. b. Private Investigative Agency: This is more expensive, but the church/ministry can direct the agency to investigate offices of districts and counties without having a church representative visit those districts and counties. c. Department of Public Safety: This is more comprehensive (state-wide) than the other methods, but it is still not as comprehensive as a claimant may argue is necessary. The church/ministry may obtain consent from the applicant for a criminal background check on the job application. Records.txdps.state.tx.us $3.72/search for Texas records 4. Checking References. a. Although personal and professional references may not provide significantly helpful information, failure to check references may be used as proof negligent hiring. b. The church/ministry should (but is not required to) obtain the applicant s written consent prior to checking the references. Again, this may be included as part of the application. c. The church/ministry should develop standard reference questions (e.g., why the applicant left prior employment, whether the employer would rehire the applicant, the type of job performance that can be expected from the applicant, and so forth). 5. Interviews. a. The church/ministry should conduct an interview after the application is reviewed and after the background check has been performed. Page 3 of 7

6 b. The church/ministry should develop standard questions that are asked during the interview. c. The interviewer(s) should take notes of the interview and should retain these in the applicant s personnel file. B. Other Employment Law Issues: There are a number of issues that arise with respect to employment of church/ministry employees. These are discussed in greater depth in Keeping Your Church Out of Court. 1. Employment at Will. 2. Disciplinary Policy and Employee Termination. 3. Providing References. 4. Federal law considerations III. Avoiding Liability from Child Abuse Claims A. Theories of liability include: 1. Negligent selection (see supra) 2. Negligent supervision (see supra) 3. Negligent retention (see supra) B. Report child abuse or neglect (Tex. Fam. Code Chapter 261) 1. Any person who has cause to believe abuse or neglect has occurred has a duty to report 2. Duty overrides all privileges (attorney, clergy, physician, etc.) 3. Immunity for good faith report 4. Failure to report: Class B misdemeanor 5. Report is made to CPS or a police agency 6. Report is nonaccusatory 7. Statute does not create a private cause of action for failure to report 8. No duty to report once child reaches age eighteen C. Implement prudent policies 1. Why Churches/Ministries Need a Child Abuse Prevention Policy a. Consistency in Practices b. Reasonableness of Procedures c. Statute of Limitation 2 years following child s 18th birthday. (Texas has not adopted the discovery rule with respect to repressed memory accusations.) Page 4 of 7

7 2. Importance of Following the Policy a. Once a policy is adopted, it must be followed b. May be argued that it is negligence per se if not followed 3. What the policy should consider: a. Worker enlistment i. All paid and volunteer workers ii. Proper screening procedures iii. 6 month rule b. Worker training i. Legal definition of child abuse ii. copy of the church s/ministry s policy for reporting abuse iii. Regular additional training and education c. Worker supervision i. Two adult rule ii. Reasonable ratio of workers to children iii. Church/ministry staff should supervise, make unannounced visits into classes, etc. iv. Identification system v. Enforce Policies d. Worker performance reviews e. Physical facilitates i. Visibility into rooms ii. Cameras iii. Secure area iv. Restrooms v. Outdoor playground area f. Insurance (see infra) i. Insurance coverage available to cover child abuse. ii. Charitable Immunity and Liability Act g. Reporting i. Reporting procedure set forth in the policy ii. All workers familiar with the procedure iii. Reporting required by state law iv. Immediately contact insurance company and report occurrence v. Contact attorney h. Steps to take in event of Child Abuse i. Appoint someone to oversee matter Page 5 of 7

8 ii. Investigate thoroughly, don t treat as frivolous iii. Maintain confidentiality of victims and accused as much as possible iv. Cooperate with law enforcement v. Suspend immediately the accused from duties if a worker vi. Keep victim s families advised of status of investigation vii. If abuse is confirmed, immediately dismiss worker viii. If evidence inconclusive, consider moving worker to position that does not involve children ix. Keep congregation informed as to matters which are not confidential x. Prepare a media response i. Transition Rules for implementation IV. Insuring Against Liability Page 6 of 7 A. Objective 1. Adequate coverage (Texas Charitable Liability & Immunity Act) 2. Appropriate coverage (Type of coverage) B. Charitable Immunity 1. Immunities Under the Charitable Immunity and Liability Act of 1987: The Texas Legislature enacted this statute, codified as Chapter 84 of the Texas Civil Practice and Remedies Code, in order to protect volunteers of charitable organizations from incurring personal liability and to limit the liability of the organization itself. a. Application to Incorporated Churches: If a church is exempt from federal income taxation under 501(c)(3) of the Internal Revenue Code and is operated exclusively for charitable or religious purposes, then the Texas statute applies. b. Application to Unincorporated Churches: An unincorporated church may also be immune from liability under this statute if the church satisfies a six-part test. It is thus less clear whether an unincorporated church may rely on this statute than whether an incorporated church may rely on the statute. c. Immunities and Limited Liability Under the Statute: i. Volunteer Immunity: The statute protects volunteers of charitable organizations, including the organization s officers, directors, trustees, if the volunteer is acting within the course

9 and scope of his or her duties or functions. ii. Employee and Organizational Liability: Limits the maximum liability of an employee of a non-hospital charitable organization and the organization itself to (a) $500,000 for each person; (b) $1,000,000 for each single occurrence for death or bodily injury; and (c) $100,000 for each single occurrence for injury to or destruction of property. C. Types of Insurance Note: The statute also provides that the limited liability applies only to those charitable organizations that have liability insurance coverage in effect. The amount of coverage required under the statute is the same as the limits in liability. d. Exceptions: The statute does not apply to any act or omission that is intentional, willfully or wantonly negligent, or done with conscious indifference or reckless disregard for the safety of others. The statute also provides that a volunteer is liable for acts or omissions that arise from the operation of a motor vehicle to the extent of a volunteer s insurance coverage. 1. Liability a. General liability insurance. b. Automobile liability insurance. c. Hired and non-owned insurance. d. Sexual misconduct insurance. e. Counseling acts insurance. f. Directors and officers insurance. g. Employment practices insurance. h. Special events insurance. King v. Dallas Fire Insurance Company (Tex. 2002): There is a duty to defend an employer for a negligent claim when the employee has engaged in intentional misconduct. 2. Property 3. Worker s Compensation 4. Employee Dishonesty This document is intended to provide churches, pastors and staff with current and accurate information about the subjects covered. However, such information is not intended to be sufficient for dealing with a particular legal problem, and the authors do not warrant or represent its suitability for such purpose. This document is being distributed with the understanding that the authors are not rendering legal, accounting or other professional advice for any particular legal problem, and the readers should not rely upon this document as a substitute for independent legal consultation Page 7 of 7

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