Are religious corporations constitutional? – Company law and corporate law

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Like Gaul, California’s nonprofit corporation law has three main parts (“Gallia est omnis divisa in partes tres‘). These three parts govern the formation and operation of three different types of not-for-profit corporations: public benefit (part 2), mutual benefit (part 3) and religious (part 4). Many, but not all, of these three parts contain similar provisions. However, there are important differences.

The Religious Non-Profit Corporations Act permits the formation of a corporation primarily or exclusively for “religious purposes”. Cal. Corp. Code § 9111. Among other things, the Attorney General has far fewer supervisory powers over a religious corporation than a nonprofit public benefit corporation.

Recently, I began to examine the constitutionality of the California Religious Nonprofit Corporations Act in light of Article I, Section 4 of the California Constitution, which provides in relevant part: no lawrespecting an establishment of religion” (emphasis added). Read broadly, a law, such as the Religious Non-Profit Societies Act, which provides for the establishment and operation of religious societies would appear to be a law “relating to an establishment of religion”. However, I doubt that the framers of the California Constitution intended to prohibit such legislation. Rather, “establishment” should be understood in the historical context of “established churches” in respect of which the government oversaw clergy and doctrine, provided funding, compelled attendance , and prohibited other religious organizations. This is not a question I have researched and would be happy to hear from any readers who may have considered the question. A similar issue also exists under the First Amendment to the United States Constitution which includes this same prohibition.

The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.

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