[The Living Church] 28 June 2007--The decision puts one division of the appellate court in direct conflict with other California court of appeal decisions, according to Eric Sohlgren, a legal spokesperson for the three parishes. The 2004 decision in Calif. Nevada Annual Conf. vs. St. Luke’s Methodist Church was only the most recent over the last 30 years in which California appellate courts have rejected the idea that it must automatically defer to the denomination in church property disputes, he said.
“Under this ruling, any big church which calls itself hierarchical could try to confiscate the property of a local congregation simply by passing an internal rule," Mr. Sohlgren said. "That idea offends basic principles of fairness and property ownership.”
If the parishes decide not to appeal to the California Supreme Court, the case will be returned to Orange County Superior Court with new instructions on which legal principle Judge David Velasquez will employ. Still at issue in the lower court, according to Mr. Sohlgren, is whether The Episcopal Church validly passed the so-called “Dennis Canon,” to which the appellate court deferred in finding in favor of the diocese and national church.
It is “unlikely” that the parishes will concede defeat as a result of the appellate court decision, Mr. Sohlgren said.
From what I understand the "Dennis Canon" did not receive receive the required approval of two successive General Conventions, and therefore was not validly passed under the constitution of The Episcopal Church. However, the courts generally defer to organizations in the interpretation of constitutions and bylaws.