Hutterville Returns to SD Supreme Court: Non-Member of Colony Leases Colony Farm Land

Imagine you’re out on your tractor planting corn on your farm. Some city slicker pulls up to the fenceline and flags you down. You finish your row, hop down, and head over to the barbed wire to see what ants he’s got in his pants. Mr. City Slicker serves you papers saying you have to stop planting your corn because your land is leased to some corporation of which you’ve never heard. “Hogwash!” you say. “This is my land. I never signed any lease.”

“No,” says Mr. City Slicker, “but your brother-in-law did.”

“My brother-in-law!” you exclaim. “That lazy bum lives in the basement. I was going to kick him out, but my wife said we need to help him out until he finds a job. He doesn’t own this farm. He can’t sign a lease.”

“Well, he says he does, and he leased the whole farm to this corporation, so quit planting.”

That’s the closest analogy I can draw to the wild case of Red Acre v. Hutterville Hutterian Brethren, which the South Dakota Supreme Court heard yesterday. Last May, Johnny Wipf, claiming to act as president and trustee of the Hutterville colony in the southeast corner of Brown County, signed a lease with Red Acre LLC, a company created by Aberdeen lawyer Robert Ronayne in 2009. Red Acre appears to have no online existence other than news mentions of this court case.

Wipf aligns himself with a branch of the Hutterites who split from the main Hutterite church in 1992. For the last seven years, Wipf and his 11 followers have battled for control of Hutterville with the local colony majority who stand on the other side of that churchwide split and who recognize the local leadership of colony Rev. George Waldner. The Wipf and Waldner factions have fought this battle on numerous fronts, including deeds and lawsuits. In previous cases involving Wipf’s effort to sign over to himself complete ownership and control of the Hutterville colony’s property, the South Dakota Supreme Court ruled that the Hutterville dispute is outside any secular court’s jurisdiction, because determining who runs Hutterville requires determining who is and is not a member of the Hutterite Church, and the First Amendment forbids the courts from making such a theological pronouncement.

Such is the argument Wipf and Red Acre made to the Supreme Court yesterday. Membership in the Hutterville corporation, the entity that can make contracts and take other legal actions, is based on membership in the local Hutterite church. The only way to determine the validity of the Red Acre lease is to determine whether Johnny Wipf really belongs to the local Hutterville church. The Court cannot determine church membership; therefore, the Court cannot determine the validity of the lease.

Do you see the absurdity here?

Suppose I decide to claim I am a Hutterville Hutterite. I get hold of a Minnesota developer, offer to sell her 9,800 acres, sign a contract and take the payment (I offer the land at a bargain, $2,500 per acre, and collect $24.5 million). Rev. Waldner and Johnny Wipf will flip their lids, but hey, what are they going to do, take me to court? No church can say I’m not a Hutterite, that I don’t believe in what the local Hutterville church believes (I’m a liberal, they’re communists, perfect fit, right?). Any opposition from members of the Hutterville corporation is based, as Wipf’s lawyers say in their response to appellees (p. 8), “upon the existence of corporate authority that no secular court is permitted to recognize.”

Wipf’s legal reasoning opens the door for me, you, and any wise guy to co-opt the legal authority and property of any religious entity, or to render any contract made by any religious group unenforceable.

The Waldner group’s lawyers whack away at Wipf’s absurdity by pointing out what the Hutterite Church and Johnny Wipf himself has said. In January 2008, 55 ministers of the Hutterite Church held a big tribunal up in Canada. This tribunal stripped Johnny Wipf of “witness brother” status in the Hutterville church. In depositions, Johnny Wipf said he had accepted the tribunal’s decision. In 2009, Wipf led eleven other Hutterville members to join a different Hutterite church, which Wipf in depositions acknowledged is separate from the Hutterville church.

Under the Ecclesiastical Deference Doctrine enunciated by the U.S. Supreme Court, South Dakota’s courts not only can but must act on the Hutterite Church’s own determination that Johnny Wipf does not have the membership the local colony church that would give him any authority to participate in making any contracts or decisions for the Hutterville colony. Waldner’s lawyers say the court is obliged to put an end to Wipf’s devious “charade”:

This Court could not have intended, on the one hand, to say that only the Church can decide whether Wipf is or is not a member; and at the same time have intended that its pronouncement should be interpreted to mean that Hutterville is forever barred from producing evidence that the Church has, in fact, decided. If that were the case, the Court may just as well have ruled that Wipf may have perpetual veto power over all of Hutterville’s business transactions so long as he chooses to tell all who will listen that he is in charge—which is exactly what he has been doing since 2008 [Appellee’s Brief, Red Acre v. Hutterville, filed 2015.01.08, pp. 39–40].

To say that secular courts cannot rule on the validity of contracts made by religious groups dooms churches to chaos in their dealings with the secular world as well as with disgruntled members. The South Dakota Supreme Court needs to rectify its error and allow the Hutterville colony to farm its own land and govern its own affairs.

24 Responses to Hutterville Returns to SD Supreme Court: Non-Member of Colony Leases Colony Farm Land

  1. I think you might have to investigate further here. The schism started may years before anything George’s lawyers are bringing up. Hutterville was a unique colony back when the Gibbs and Oilers split. During that split most of the colonies had a majority of one side, so just a few families left the colony to join a colony that kept with their side of the split. Hutterville was different because it had a roughly even split between the two sides. From that time on George and his side became “tyrants” as I have heard some runaways describe it.

    The real legal problem comes from a few years back when the SD Supreme Court refused to dissolve the corporation. That would have allowed the assets to be split and both sides to go their own way. The matter before the Supreme Court at that time had nothing to do with religion. It had to do with a corporation that no longer was able to operate under the law.

    Everything since then (including many civil and criminal court hearings) have left Hutterville in an odd legal limbo where the court has outright refused to say who legally controls the corporation or allow it to be dissolved.

  2. I’m confused now. Cory, can I or can I not sell the Brooklyn Bridge?

  3. Sam Drucker

    Depends on whether you’re from Hooterville.

  4. Nick Nemec

    Can the courts appoint a “special master” much like the guy who determined compensation for WTC victims? All assets would be sold to the highest bidder and divided among the parties the master determines are members, some members would might get more than others, for instance a 50 year old who has worked their entire adult life on the colony would deserve a larger share than an infant. No appealing the decision of the master, all decisions are binding.

  5. El Rayo, if the Brooklyn Bridge were owned by a corporation in which membership were contingent on religious affiliation, then, by Wipf’s reasoning, yes, you could!

  6. Fascinating, Ken! I agree: the Supreme Court left the colony and any other religious corporation facing a dispute over ownership in limbo, as well as any outside player trying to do business with them.

  7. Nick, if I recall correctly, that’s sort of what the Circuit Court tried to do in a previous court battle when it ordered the Hutterville corporation dissolved and appointed Harvey Jewett (law firm partner of Jeff Sveen, friend of Hutterite turkey growers and Hutterites everywhere) as receiver to handle the asset distribution. An appeal to the Supreme Court nixed that idea.

  8. And Ken, when did that Gibbs and Oilers split happen? Are those names of families at the colony?

  9. “Special master” Ol Harv Jewett. If you never had the luxury of watching the lord in action, you’ve missed SD Regental governance.

  10. Nick Nemec

    Appointing Harvey Jewett would be, in my mind inappropriate, he is to close to too many Hutterites to be objective. The special master would have to be someone with no connections to Hutterites of any type. I would suggest a retired judge from a part of the State with no Hutterite presence, possibly West River.

    This is all contingent on the SD Supreme Court reversing their previous misguided decision.

  11. Back in the 80’s through 90’s one of the Canadian heads of the church (I think Jake or Jacob) Kleinsasser was caught in dirty/unethical dealings with the oil fields. A Gibb was the one to find it out and call him out. That created a rift where most of the colonies followed the Gibb side, and some followed Kleinsasser. There are millions of dollars involved, and many of the Gibbs believed Kleinsasser was followed by some of the colonies for financial reasons.

    After that came to light the Gibbs called the other side Oilers. The Oilers do not like that term, and from what I understand they started to brand themselves “progressives”. Although much like the State of SD just used the term in a marketing video, it really doesn’t mean progressive in the way we would understand. It was basically a marketing term and they pretended to do some reforms to their rules that are not actually followed.

    Since Hutterville was half Gibb and half Oiler it left them in a long battle from the 90’s, and it still going on today. Every passing day things get worse and worse out there.

    Georges side has made it has physically and mentally hard on Johnny’s side as they can. Just in the last year they have done things like cut off power to Johnny’s side and kept Johnny’s side away from food. There is a power-keg brewing out there.

    If I ever get time I hope to do a series of posts. The main problem is George’s side is so litigious that anything said has to be cleared through a lawyer (I probably should have done the same with this comment). Of course two years ago when it looked like things might go bad for Georges side in court, George coincidentally happened to be in Canada… Unfortunately that was when the Supreme Court ruled wrong, and refused to get involved. It was then ordered in our local court for Jewett to stop being retainer. The judge wouldn’t rule on who was actually in charge of the assets. He basically told Jewett to mail everything to the official Hutterville address and let them sort it out.

    From that point on many on Johnny’s side lost all faith in the legal system. I think they would have preferred a bad decision from the Supreme Court, instead of the non-decision that the trial ended with.

  12. From what I remember Harvey Jewett was chosen because he had dealing with both sides and had no apparent favorite side. Jewett probably would not be a good fit for such a position anymore. It was mentioned in court that Georges side consistently failed to work with Jewett. I would think that would leave Jewett unwilling to work with them again.

    I do have my notes from a few years back while sitting through many of the hearings. It was a crazy series of hearings that left me almost speechless at times.

  13. David Newquist

    I attended most of the court hearings leading up to the state supreme court’s ruling that the First Amendment excluded the courts from any subject matter jurisdiction in this dispute. Harvey Jewett was by no means an impartial trustee, and the Waldner faction’s wariness about working with him came after a number of actions on his part that called his actions into question. At one point during the court hearings, he exhibited such an intimidating demeanor toward a witness that a lawyer on his own side intervened and told him to stand away from the witness, when the judge failed to do so.

    Under the circumstances, it is very, very puzzling why Red Acres would sign a lease with Wipf when it was well known that Wipf held no official leadership within the colony, having been denied the status of “witness brother.” However, the Sveen-Jewett connection, which pervades so many questionable business activities within the state, is part of the dispute.

    The Hutterville Hutterian Brethern, Inc., was incorporated in 1983 as the managing organization for the colony. Eventually, Jeff Sveen became listed as the coporation’s agent. In 2002, the MIdland Hutterian Brethern, Inc., was incorporated to be the managing agency for the same colony. In 2009, it changed its name to the Beulah Hutterian Brethern, Inc. In both formulations, Jeff Sveen was listed as agent. Johnny Wipf was one of the original incorporators.

    The question never answered is how two corporations can be set up to manage the same assets? And how did the attorney who was familiar with both articles of incorporation contrive this to happen?

    As the dispute between conntending factions progressed, Sveen was ultimately removed as agent for the Hutterville Hutterian Brethern, which is now involved in a layer of corporations, with one incorporated under Minnesota law.

    The Waldner group is responsible for establishing the high school at the Hutterville Colony. Its principal is a graduate of NSU who was chosen by colony elders to attend college. Some NSU faculty members encouraged and supported the establishment of the high school and encouraged the idea of more students be sent to college, not only to prepare for teaching, but to acquire other areas of knowledge useful to the Hutterites. One hope is to educate lawyers who can reconcile Hutterian ecclesiastical law with civil law. The dispute will probably not be settled until that time is reached.

  14. David, that note about the high school is very interesting. Their establishment of a high school reflects the Waldner factions commitment to higher education, one of the significant factors that caused the faction Wipf follows to split in the 1992 schism. Have the Waldners actually cited training their own lawyers as one of the goals of the school?

  15. “”The dispute will probably not be settled until that time is reached.””” Or until corruption no longer replaces civil law.

  16. David Newquist

    It was a suggestion made to them, when a review of the reports to the Secretary of State’s office for a number of Hutterian corporations in South Dakota showed the pervasive presence of Jeff Sveen. The people to whom the suggestion was made agreed that the Hutterites need legal counsel that can create documents that recognize the operating standards of the church, but whether they have that as a specific goal was never indicated.

    I had two Hutterite students come in during the spring semester and told me that the elders informed them one day in a barn that they had been selected to go to college. They began during a summer session, by which time the colony provided them with computers and the keyboarding skills needed to operate them. The work and preparation they put in for class was dismaying to other students.

    Now the two students are in opposing factions at Hutterville.

    However, when the decision was made to establish a high school, professors from NSU assisted them in the process and in setting up the instructional programs. The high school was in jeopardy when the Wipf faction tried to take over.

    The struggle is a bitter one between the factions. Both have used harsh tactics. The courts say the dispute should be settled by the hierarchy of the church, but the factions extend to most of the North American colonies.

    I have seen these factions tear apart other communal religious colonies. A Mennonite colony that was in my coverage area when I was a newspaper editor ended up making a voluntary dissolution, sold its farmland, and the members all moved away. The Amish in Iowa promoted education for their young people, and it was some of their bright young engineers who produced the Amana refrigeration company that made refrigerators, freezers, and air conditioners. The Amana brand has gone through a series of acquisitions by huge corporations, an indication of the complicating factors involved when a religious organization gets involved with corporate business. Like many conservative groups within our state, some colonists fear education as a threat to their church.

    NSU has had a number of Hutterite students, who commute to the campus from nearby colonies. Further education which might require residency elsewhere is a matter of concern, and utilizing online courses with advisors coming to the colonies is a possibility. However, the turmoil at Hutterville seems to preclude such considerations at this point.

  17. Bill Dithmer

    It sure would be interesting to know

    1. How many different people wrote checks to pay property taxes? It wouldnt tell who the actual owners were, but it should tell an interesting story.

    2. How do they file with the IRS? How do they figure deductions?

    And 3. What law gives credibility to the legality of not just that colony but any others? If the law doesnt work, and it must not, its time for a fix.

    Special rules for people trying to use the system will never work. If you feel the need for special religious treatment to keep your faith alive, while at the same time your playing high stakes business poker in ag, maybe you need to reassess your strategy.

    The only difference between any colony and the compound at Pringle is the amount of time they have been there.

    The Blindman

  18. Roger Elgersma

    When a church splits majority does not really matter. If ninety percent of a congregation do not like that your denomination changed policy, abortion or gay pastors, and they decide to leave the denomination, the people in that congregation do not own that church building because they left of their own decision. It is owned by the denomination. It does not matter if they built and paid for that building, it is not theirs. So it does not even matter if those people believe exactly what they always did, they are the ones disagreeing. Disagreeing with someone who thinks God put them there does not always go easily, even if you are right. Whose definition of right comes into play here.
    So if you changed your beliefs, you do not own the place or if the church changed its beliefs, decided to get into the oil business, you do not own the place. The only safe way is to join a church where both you and the church will never change.
    If your local congregation leadership goes astray of God’s will, you would have to go through the denomination or local channels to change out the local leadership. This would take an act of God in a hierarchical system.
    Since the Bible says, “All have sinned and fallen short of the glory of God”, no one is safe from the earthly powers that be even if they are in the church.

  19. Bill D, on your 2, I can tell you that the Waldner faction’s brief to the SD Supreme Court says that Rev. Waldner is the authorized signer for the federal tax returns (pp. 16–17).

  20. Bill D properly recognizes the problem: there is a limit to the leeway religious groups can get when they engage in secular activities. If they are going to make contracts and do big agribusiness, they have to accept some degree of secular authority over their dealings.

    Then again, I suppose the Hutterites could ask their secular partners to sign contracts referring all disputes to arbitration by religious authorities….

  21. Roger, it seems to me battles over theological differences within a congregation can be nasty enough without the added layer of having millions of dollars of land, farm equipment, and business contracts at stake. But in this case, if every member is committed to the ideal of communal property and rejects self-enrichment, the power struggle shouldn’t be as bad, should it?

    Why can’t Christians all just follow their principles? Darned fallible human beings.

  22. Back in 2002, I was a student at Northern State University. I had a couple of classes with a couple different Hutterville members from the colony. They told me that the decision to start a high school on their colony was because farming was becoming more technologically advanced and they needed more education to keep up.

    In another interesting tidbit from the story, I find it interesting that Robert Ronane is involved in a questionable land deal. Back in the early 2000’s, Ronayne represented a party in a Spink County land dispute that pulled a fast one and took advantage of an elderly landowner. Unfortunately, this is not new territory for Ronayne.

  23. Interesting, Thomas. Do you recall how that Spink County land deal worked out or the names involved? Did that dispute go to the state Supreme Court?

  24. Honest John Schaeffer

    For the record. It was still left muddy how the term “Gibb” came into being. Jake K, of Crystal Springs, Manitoba was the bishop of all the colonies in Man. , North and South Dakota and MN. He and a couple others invested money that was held in joint trust of all the Hutters. It is said they did not have permission of all the colonies to invest the money. Jake K claimed he did. It went to court. The money was invested in oil and they lost a small fortune. (One can’t wonder if they’d made money instead of losing it what the reaction had been? Would it have been “blessed foresight”?)

    So, it went to court. The lawyer who represented those opposing Jake K was named Gibb and so that’s why that group is called Gibbs. It’s not a Hutterite name. It is also very interesting how the rules of the Hutterite church forbid going to war, swearing of oaths, and going to law to sue. Yet time and again they drag their dirty laundry off to court when they can’t settle their own disputes.

    It would seem the case of the Ebenezer Presb. church at Lennox which also went to the State Hight Court would kind of be an example here. It was decided the majority ruled and the minority was paid off and asked to leave.

    In this case it would appear that now, at least, there are more Gibbs than oilers at Hutterville. The majority should rule and those who don’t like it can lump it or be paid off and asked to leave.

    Really, do we want the state getting too involved in “church” business? The problem with the Hutterites is there’s no clear distinction between church business and their running a multi-million dollar corp.

    It would appear that all is not paradise in Utopia the way the Hutterites want the outside world to believe. They should figure out how to solve their own disputes and not drag it to court.