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Judge Rules Episcopal Diocese of Los Angeles Able to Sell St. James Church

On Friday, May 6th, 2016, an Orange County Superior Court judge said that a prior deed restriction on the St. James the Great Episcopal Church property in Newport Beach does not prevent the Episcopal Diocese of Los Angeles from selling the property, given that the restriction was not renewed. The deed to the church property at 3209 Via Lido was transferred from Griffith Co. to the Episcopal Diocese in 1945 under the provision that the site remain a church. When Bishop J. Jon Bruno announced in May 2015 that it would sell the property to Legacy Partners and its investment partner, AIG Global Real Estate, Griffith Co. sent a letter asserting that the company had never released the deed restriction. Bruno proceeded to sue Griffith for clear title and for interfering with the sale, which has since been put on hold.

Attorneys for the diocese asserted that the use restriction expired when Griffith Co. failed to renew the restriction within the 30-year period established under state law, which ended in 1987. In 1984, the church had also negotiated the removal of the restriction for all but a single lot on the property. While all main sections of the property were listed – including the sanctuary, the parish hall, and other facilities – a courtyard that sits between the church buildings was left strangely absent from the agreement.

Attorney Morgan Stewart of Manly Stewart & Finaldi is representing Legacy Partners in the matter, contending that the dispute caused Legacy's investment partner, AIG Global Real Estate, to withdraw from the purchase over the volatile position of the property. Legacy spent nearly $160,000 in consultant fees, investigation fees and legal costs while seeking to buy the property. As it stands, Legacy is unable to complete the purchase without a joint venture with another entity.

Parishioners of the church have equally been affected by the lawsuit, as services have been forced to be held in alternate locations after Bishop Bruno had the locks of the church changed following its final service in 2015.

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