Enforceability of Conciliation Clauses and Decisions

Enforceability of a Conciliation Clause in a Contract:

Encore Productions, Inc. v. Promise Keepers, 53 F. Supp2d., 102 (D.Colo. 1999) held:

“Ordinary contract principles determine who is bound by written arbitration provisions. See Fisser v. International Bank, 282 F.2d 231 (2d Cir.1960). Encore and PK executed the Service Contract which contains an enforceable arbitration provision. The arbitration process between these corporations contemplates participation by their principals. By executing the Service Contract on behalf of Encore, Encore’s principals consented to participate in an arbitration governed by the Rules of Christian Conciliation.

Furthermore, although Encore is correct that courts cannot employ “religious organizations as an arm of the civil judiciary to perform the function of interpreting and applying state standards,” here the parties themselves agreed and consented to arbitration before Christian Conciliation. (Encore’s Objection to PK’s Motion to Dismiss or Stay Proceedings, p. 7). Although it may not be proper for a district court to refer civil issues to a religious tribunal in the first instance, if the parties agree to do so, it is proper for a district court to enforce their contract. Therefore, Encore is now precluded from challenging the enforcement of this valid agreement. See Elmora Hebrew Center, 593 A.2d at 731.

Encore voluntarily signed a contract containing a written arbitration agreement that clearly and expressly disclosed that arbitration would be submitted to Christian Conciliation. This manifests intent to be bound by Christian Conciliation’s decree and a knowing and voluntary waiver of their rights to pursue litigation in a secular district court. See id. And, significantly, in a letter written to counsel for PK on September 10, 1998, well after the date of the Termination agreement, counsel for Encore stated that Encore was “willing to discuss initiating Christian Conciliation as mandated under the contract.” (Exhibit 2 to PK’s Reply to Encore’s Response, emphasis added).”

Enforceability of Arbitration Awards:

Courts have also reviewed arbitration decisions, rendered according to The Rules of Procedure for Christian Conciliation and found the rulings to be valid and not subject to review or being over turned. Cases reaching this conclusion include:

• Encore Productions, Inc. v. Promise Keepers, 53 F. Supp2d., 102 (D.Colo. 1999) held:

Civil courts have only “marginal review” power over the decisions of arbitral bodies, secular and religious. See Presbyterian Church in United States v. Mary Elizabeth Blue Hull Memorial Presbyterian Church, 393 U.S. 440, 447, 89 S.Ct. 601, 21 L.Ed.2d 658 (1969). For example, inquiry into a religious determination may implicate fraud and collusion. These grounds parallel the limited basis on which courts will review the results of conventional arbitrations. See Serbian Eastern Orthodox Diocese for United States of America and Canada v. Milivojevich, 426 U.S. 696, 713, 96 S.Ct. 2372, 49 L.Ed.2d 151 (1976) (not allowing court review of “arbitrariness” of a religious tribunal’s decision). Consequently, although Christian Conciliation may be characterized as a religious tribunal, any award in arbitration is subject to limited review by a secular court.

Other decisions upholding the enforceability of faith-based arbitration decisions include:

• Prescott v. Northlake Christian School, 244 FS2d 659 (United States District Court, E.D. Louisiana, 2002); .369 F.3d 491, 187 Ed (5th Cir. 2004); Civil Action No: 01-475, Section: “J” (2), Oct. 29, 2004.
• Presbyterian Church in United States v. Mary Elizabeth Blue Hull Memorial Presbyterian Church, 393 U.S. 440, 447, 89 S.Ct. 601, 21 L.Ed.2d 658 (1969).
• Serbian Eastern Orthodox Diocese for United States of America and Canada v. Milivojevich, 426 U.S. 696, 713, 96 S.Ct. 2372, 49 L.Ed.2d 151 (1976).

There are also at least two cases that did not enforce a conciliation Clause:

• ​Rejecting ICC arbitration clause as unconscionable: Higher Ground Worship Center v Arks, Inc. (Case No. 1:11-cv-00077-BLW, March 1, 2011, Fed Dist Ct, Idaho) (Note that the defendant lessor had modified the standard ICC clause by inserting an exception for non-payment of rent.)  — Clause was procedurally unconscionable where church was led by pastor with GED who had little bargaining power compared with builder; and substantively unconscionable because it forced the weaker party—the church—to arbitrate all its claims but exempted non-payment of rent, allowing lessor to sue church for non-payment, which it did. [interpreting North Carolina law]
• Refusing to enforce ICC clause in church membership: Doe v Vineyard Columbus, No. 13-AP-599 (Ohio Ct of Appeals, 10th App Dist, 2014) – Couple was not precluded from suing their church despite signing a membership agreement that contained the ICC clause because the couple never saw the ICC clause and were never informed of the church policy.

The legal, ethical and political issues related to faith-based arbitration are far from settled, however, as these articles show:

• The Ethics of Religious Arbitration
• Opinion: Making Religious Arbitration Work in America: The Jewish Experience
• A Higher Authority: Judicial Review of Religious Arbitration
• Faith-Base Arbitration Evaluated: The Policy Arguments for and Against Religious Arbitration in America

Click here to see model language for conciliation clauses in contracts in business contracts, employment agreements, church membership agreements and trusts and will.

Related Information

• Additional Conciliation Providers
• Three Levels of Peacemaking
• Introduction to Christian Conciliation – Frequently Asked Questions
• Rules of Procedure for Christian Conciliation
• Standard of Conduct for Christian Conciliators
• Conciliation Clauses for Contracts and Wills
• Conciliator Grievance Policy