Texas Supreme Court to hear arguments later this month in SMU's bid to split from church

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The highest court in Texas will hear arguments in the coming weeks on Southern Methodist University’s attempt to split from the United Methodist Church.

What We Know: The Texas Supreme Court will hear arguments between Southern Methodist University and the South Central Jurisdictional Conference of the United Methodist Church on Jan. 15.

The court will have to decide who has the ultimate authority over the school’s decision-making; either the school’s board of trustees or the church.

The church claims the school’s articles of incorporation give the conference the ability to block amendments to those articles.

The Backstory: In 2019, SMU’s board of trustees voted to amend the school’s articles of incorporation to clarify that the university is a separate entity from the United Methodist Church.

The move came after the church voted to keep its ban on recognizing same-sex marriages and ordaining clergy who are members of the LGBTQ community.

In those amendments, SMU clarified that the school was only managed by the board of trustees.

This led to a lawsuit by the South Central Jurisdictional Conference claiming the amendments were invalid because they did not have board approval and that the property the university is on belongs to the conference.

The conference amended its argument to claim the university had breached its contract with the conference and breached its fiduciary duties as they financially damaged the conference, citing a Texas law that would allow them to recover losses because the university filed the new amendments with the Secretary of State.

All the claims made by the conference were dismissed by a trial court.

The judgment was appealed to the Fifth Circuit Court of Appeals, who reversed the breach of contract decision.

The university filed an appeal to the Texas Supreme Court claiming the court went around the state’s rules on who can make an "ultra vires" claim.

An ultra vires claim is a claim that a corporation or government has acted outside its legal authority.

In Texas, only shareholders, the entity or the attorney general can make such claims against an entity.

SMU claimed the conference falls outside those rules because they do not have a stake in the university.

Attorneys for the university said the court was the first to say a non-member nonprofit’s articles of incorporation were a binding contract for the purpose of a breach of contract claim.

In a filing with the Supreme Court, SMU’s attorneys said the appeals court "disregarded a longstanding precedent that a legal opinion can’t be ‘materially false’ or give rise to damages where there’s no cognizable harm."

By the Numbers: The SCJC covers eight states, Arkansas, Kansas, Louisiana, Missouri, Nebraska, New Mexico, Oklahoma and Texas, according to their website.

Beyond SMU, the conference operates the Lydia Patterson Institute in El Paso and Saint Paul School of Theology with locations in Leawood, Kansas, and Oklahoma City.

SMU's website says more than 12,000 students attend the Dallas institution.

What's Next: The Texas Supreme Court has scheduled oral arguments in the case for Jan. 15. The court hears arguments from 9 a.m. - noon.