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151680 - Pilgrim's Rest Baptist Church v Arthur Pearson, Sr

Pilgrim’s Rest Baptist Church, a/k/a Pilgrim Rest Missionary Baptist Church, Nathan Mayfield, and Stephon Blackwell,
Bernard C. Schaefer
(Appeal from Ct of Appeals)
(Kent – Leiber, D.)
Arthur Pearson, Sr.,
Jerry L. Ashford


Defendant Arthur Pearson, Sr., the pastor of Pilgrim’s Rest Baptist Church, was accused of misappropriating church funds.  After the church’s membership voted to retain Pearson as pastor, an accounting firm hired to examine the church’s finances determined that more than $237,000 had been removed from the church’s bank accounts through questionable transactions.  Consequently, the church’s board of trustees voted to suspend Pearson with pay.  The plaintiffs then sued Pearson, seeking injunctive relief as well as reimbursement of the misappropriated funds.  The church subsequently terminated Pearson’s employment.  In a separate criminal case, Pearson pled no contest to embezzlement of between $50,000 and $100,000.  He was sentenced to four years of probation and was ordered to pay restitution of $167,452.81 to the church.  After entering the plea in the criminal case, Pearson filed counterclaims against the plaintiffs, seeking damages in excess of $1,000,000.  The trial court dismissed the entire case as non-justiciable because the dispute was between a church and entities within the church’s body.  The Court of Appeals, in a published opinion, affirmed the dismissal of Pearson’s counterclaims as non-justiciable under the “ecclesiastical abstention” doctrine.  But it remanded the case to the trial court for further proceedings on the plaintiffs’ claims.  Pearson appealed to the Supreme Court, arguing that the Court of Appeals erred in upholding the dismissal of his counterclaims.  On December 9, 2015, the Supreme Court ordered oral argument on Pearson’s application for leave to appeal.