Church Empire on Verge of Collapse Into Legal Morass

A church that grew to become the keystone of the largest Protestant empire in Glendale appears to be on the verge of collapse this week with a dwindling congregation that is divided in the wake of massive legal entanglements and financial woes.

The minister and all of the staff of the organization--the Church in Glendale--have announced their resignations. The congregation on Sunday will be asked to put the church’s property up for sale.

Classroom facilities at an adjoining seminary are also to be sold and the students moved to Anaheim. A senior citizen housing development in Pasadena, which was to house the church’s elderly, is also in bankruptcy and up for sale.

The church was the foundation of an empire built over 25 years by the Rev. William Steuart McBirnie, an outspoken and controversial minister who arrived in Glendale in 1961.

Syndicated Radio Program

McBirnie launched his empire as the senior minister at the then-fledgling United Community Church in Glendale. He soon expanded his ministry to a widely syndicated radio program, “Voice of Americanism,” and founded the California Graduate School of Theology in 1969.

Other McBirnie-founded organizations include the United Community Churches of America and the Concord Senior Housing Foundation, which operates a 150-unit apartment complex in Pasadena.

The empire began to collapse in the mid-1980s when McBirnie and his organizations became embroiled in a series of lawsuits alleging that creditors had been defrauded through unpaid loans.

Damages Awarded

A Glendale court commissioner in 1985 awarded 26 former church members $200,000 in actual damages and $1 million in punitive damages, finding that the various church enterprises operated under McBirnie’s control were treated “as if they were one.”

Eventually, suits were filed claiming that 380 creditors are owed up to $3.7 million loaned to various McBirnie-founded organizations. Those suits are pending in federal bankruptcy courts.

McBirnie has said that he does not control the organizations that he founded and is not responsible for their finances.

In the wake of the controversy, McBirnie stepped down from the pulpit at the United Community Church in Glendale in 1986. He was replaced by the Rev. John Myrick, who undertook the task of rebuilding the church’s image.

The name of the church was changed last year in an attempt to shed its reputation and to divorce itself from McBirnie’s United Churches of America, Myrick said in an interview this week.

Church members say the effort was fruitless. They propose to sell the church, worth an estimated $8 million.

The collapse has left deep scars among the Glendale congregation.

‘Enough Is Enough’

“Enough is enough,” said Myrick, who told the congregation last week he will resign as soon as final affairs are put in order.

“To renew a healthy church is a hard thing to do,” Myrick said. “But to renew a church that is already sick is almost impossible.”

Indeed, the task became impossible, Myrick said, because of divisions among the church membership. “The legal entanglements here are greater than they have ever been,” Myrick said. “There is a power struggle here between four different groups. . . . The divisions overtook us.”

Myrick on Sunday will ask the congregation, which has dwindled from about 1,100 a decade ago to about 400, to endorse the church’s recommendation to sell the property.

Myrick said he wants the proceeds to be used to pay the claims of all of the creditors and the balance, which he estimates at $5 million to $6 million, to be donated to worldwide religious missions.

Myrick said he is willing to start again without the grandiose hexagonal building at 333 E. Colorado St. “Everyone thinks that the church is a building,” he said. “What we are giving up here is not a church. I don’t think this building is worth the fight. I’m not quitting the ministry, and I’m not quitting the church. . . . But it’s not going to be in this building.”

The United Community Church in Glendale was a concept in the minds of about 21 people when McBirnie became its first pastor, said the Rev. Joel MacCollam, a spokesman for McBirnie. Shortly thereafter, the pastor began his “Voice of Americanism” radio broadcasts, in which he sharply attacked communism.

Worldwide Campuses

McBirnie founded the United Community Churches of America in 1964, MacCollam said, and the California Graduate School of Theology on property adjoining the church in 1969. The seminary was one of the first to offer courses on extension campuses worldwide, he said, and has about 800 students, including those in Japan and South Korea.

McBirnie used the radio broadcasts, the pulpit and later a syndicated television program called “Trumpets in the Morning” to solicit loans to buy property and build facilities for his expanding ministry.

The majority of the funds went to the United Community Churches organization and were used to benefit the theology school, according to Christ T. Troupis, an attorney representing creditors.

McBirnie and his representatives have said the programs ran into trouble when interest rates soared in the early 1980s. Many creditors who had been promised repayment at 6% to 10% demanded their money back when commercial rates climbed to almost 20%, MacCollam said.

Myrick said his church “never received a penny” of proceeds from the unpaid loans but is being held partly responsible by the courts for repayment. “I believed that in time the legal problems could be overcome. . . . But, in time, they all kept growing worse.” He said the church, in the suits, became “an alter ego” of McBirnie.

Myrick called the controversy “a blight on the Christian world.” He said he is eager to repay the loans to elderly creditors “who are now near death” even though he contends that the debts were not incurred by the current congregation. He said, “It is time to stop trying to figure out who is right and who is wrong.”

Meantime, McBirnie, who has remained as chancellor of the seminary housed next to the church property, has announced plans to move the school to the Melodyland Christian Center in Anaheim.

That center has also been embroiled in controversy for the past few years. The pastor, the Rev. Ralph Wilkerson, got into a legal entanglement with the board of the Melodyland School of Theology. The school eventually moved to a location away from church property, leaving the Christian center with empty classrooms.

Wilkerson and McBirnie announced during graduation ceremonies of the Glendale seminary on Friday that the California Graduate School, headed by McBirnie, will relocate to the Anaheim center, probably in August.

During opening remarks at the ceremony held at Forest Lawn in Hollywood Hills, McBirnie acknowledged some of the school’s alumni, including chastised television minister Jerry Falwell, Sen. Strom Thurmond (R-S.C.) and four past presidents and the current president of the Southern Baptist Convention.

McBirnie announced at the ceremony: “We are going to move the school from Glendale to much finer quarters at Melodyland, opposite the east gate of Disneyland.” He said Melodyland and its pastor, Wilkerson, “have turned over very sumptuous quarters to us. They have a parking lot large enough to land, well, if not a B-47, perhaps you might say a 747.”

McBirnie also revealed that Wilkerson will become chancellor of the California Graduate School of Theology in the fall. McBirnie will assume the position of president.

Wilkerson called on attendees at the graduation to donate money. He said: “All I want tonight is everything you have. . . . It’s going to cost some money to launch this school.”