The “Stable Patrimony” and Religious Congregations – Part II

The importance of the Stable Patrimony; formal assignment and identification of assets

This follows upon our previous Newsflash on the same matter and is intended to provide you with some further considerations regarding the Stable Patrimony in anticipation of the upcoming DIKAOIS workshop which will take place on Tuesday 29 March 2022, from 09:30 to 17:30 at the Casa Maria Immacolata, in Via Ezio 28, Rome. At this event, the Dikaios team together with Prof. Andrea Bettetini of the Catholic University of Milan and Dott. Marco Cotogni, commercialista in Rome, will discuss the legal, fiscal and practical aspects of the Stable Patrimony.

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Following the 1984 modifications to the 1929 Concordat between the Holy See and Italy, the Stable Patrimony constitutes an effective instrument to safeguard the integrity of an ecclesiastical entity by preserving that portion of an entity’s assets considered indispensable to ensure its material survival and, consequently, its ability to develop its charisma. Consequently, an important goal of the Stable Patrimony is to preserve from unnecessary risks those assets that guarantee the existence of a religious entity.

The constitution of a Stable Patrimony is not only a tool provided for in canon law, but it can also have important and far-reaching effects in civil law.

In its “Guidelines for the Management of Goods”, the Congregation for Institutes of Consecrated Life and Societies of Apostolic Life, in line with the Administrative Instructions of the Italian Bishop’s Conference, has urged Religious Institutes to become more aware of the importance of economic matters, providing criteria and practical guidelines for the management of assets.

Formal aspects: identification of assets and their legitimate assignment to the Stable Patrimony

A religious institute, which decides to constitute its Stable Patrimony must take two formal steps:

• after a careful evaluation of its overall asset situation, the Institute must establish a list of assets that constitute the Institute’s Stable Patrimony.
• the Major Superior with his/her Council or a body endowed with collegial power (e.g., a General or Provincial Chapter) formally resolves to assign these assets to the Stable Patrimony – the “Legitimate Assignment”.

The criteria and procedures for the designation of assets to the Stable Patrimony must be established by the Constitutions or in another legal document of the religious institute. It is also considered useful, if not strictly necessary, that these rules and procedures be submitted to the competent ecclesiastical authority for confirmation.

For the designation of the assets to be assigned to the Stable Patrimony, it might be useful to keep in mind the following general principles of Church doctrine regarding the healthy management (sana gestio) of ecclesiastical goods. These principles, if put in practice, will ensure that the assets of religious entities are managed in line with their charisma and, hence, the religious objectives of the Church in general.

• the teleological principle: possession and use of assets according to the purposes of canon 1254
• the principle of autonomy: the ability of an entity to give itself rules for the use of the same assets
• the principle of subsidiarity: each entity manages its goods for the general benefit of the Church.
• the principle of co-responsibility: managing the assets in such a way as to involve the community, informing it and making shared decisions, each member according to its proper capacity and condition
• the principle of inter-organic collaboration: everyone has specific functions of its own competence.

Material aspects: the identification of assets belonging to the Stable Patrimony

The creation of the list of assets that constitute the Stable Patrimony can be complex and challenging. This may be one of the reasons why many Congregations have so far abstained from establishing their Stable Patrimony.

There are no predefined criteria for defining the Stable Patrimony of an ecclesiastical entity; this will depend on the nature and the quantity of the assets and the dynamics of the Institute’s mission (in expansion or in regression) at a given time. In fact, the Stable Patrimony reflects the situation of a Religious Institute at a particular time and is subject to modification in view of the Institute’s changing situation.

That being said, the Stable Patrimony, albeit fluid in nature, should be a useful instrument for the medium to long term and the rhythm at which it is reviewed should be indicated in the Constitution or other document of the Institute (e.g. at every General Chapter).

In general, the Stable Patrimony will be composed of those assets that

• are part of the entity’s foundational endowment
• have been donated to the entity specifically for this purpose; and
• assets attributed to the Stable Patrimony by legitimate assignment by the entity’s administrative body.

These are usually real estate assets used for the activities of the entity, but the Stable Patrimony can also include other temporal goods that allow it to realize the mission of the Church, e.g investment assets, etc.

In doing this work, Congregations will have to calculate capital inflows and outflows over the medium to long term and also to determine which transactions must be authorized and which must not and establish a periodic inventory that is transparent and verifiable by the competent authorities.

Whereas in doctrine the theoretical content of the Stable Patrimony is quite clear and may be reassumed as “a set of assets not intended for the ordinary management of the legal entity. […] movable and immovable assets that not only constitute the minimum economic and financial basis for the autonomous existence of the ecclesiastical legal entity, but also enable it to carry out the purposes and services which are its own”.

Regarding the formal aspects of the identification of the goods that specifically belong to the Stable Patrimony of a given religious institute, Canon 1291 offers a valuable indication by providing that there has to be a “legitimate assignment” that is, a juridical act such as:

• the decree establishing the canonical institution
• an act of the competent authority which assigns the property to the institution and imputes it to the stable patrimony
• an act of the competent authority authorizing the administrator of the legal entity to acquire/accept an asset and ordering its allocation to the Stable Patrimony
• the resolution of the board of directors of a canonical foundation/association
• the willingness of the administrator to accept a testamentary disposition or a donation that prescribes the destination of the assets to the Stable Patrimony of the beneficiary entity or, in any event, to a restricted use.

Doctrine admits, however, that certain assets can be considered belonging to the Stable Patrimony even in the absence of a formal provision provided that these assets are objectively necessary for the achievement of the purposes of the entity (e.g. the building where the institute of consecrated life carries out its charismatic activities, the building used for educational activities by an institution with the charism of education, or the hospital used for health care by a congregation dedicated to the care of the sick).

Conclusions

The complexity of the economic and financial issues regarding the management of assets today requires the collaboration with professionals, lay people, or members of other Institutes. In order for the Stable Patrimony to unfold its raison d’être, i.e. to be protected from ordinary business risks and deterioration, it is of great importance to establish it according to the principles of good and sound management of assets, creating and preserving utmost transparency through legitimate acts of assignment, based on accountable documentation, i.e. updated inventories of the Stable Patrimony itself.