Religious Lawsuits Filed Over Real Estate Issues

Religious lawsuits may involve various issues, including the Constitution, wrongful termination, and discrimination. While real estate is not typically associated with religious lawsuits, two recent cases show that these two areas can intersect. These lawsuits involve situations where churches are involved in property tax exemption and landlord activities. 

Atheists Sue City of Madison for Property Tax Discrimination

In January of 2025, The Christian Post reported that a group of atheists were suing a city in Wisconsin for discriminatory practices regarding property taxes. The atheists claim that the City of Madison offers certain religious nonprofits exemptions on property taxes but does not offer this same exemption to other religious or non-religious groups. They argue that due to the anti-discrimination principles of the Constitution, taxing one religious group more than another is illegal. 

The main focus is a church in Madison which owns and operates an apartment complex. The plaintiffs argue that for years, the church has enjoyed significant property tax exemptions on their real estate specifically due to their religious faith. Meanwhile, nonreligious entities were forced to pay higher taxes on their real estate. They also claim that this church enjoyed better exemptions than other religious groups – implying that this is not simply an issue of “atheists vs religious people.” 

Along with violating the US Constitution, the plaintiffs allege that these discriminatory taxes also violate the Wisconsin Constitution. The state Constitution specifically states that the government cannot give preferential treatment to any religious faith. This exemption was previously repealed in 2011, but this repeal was subsequently vetoed by the former Governor of Wisconsin. A representative of the church group states that they are looking forward to having their day in court. 

Tenants Sue Their Own Church for Uninhabitable Homes

Also in 2025, a group of tenants in Los Angeles decided to sue their landlord for what they say are unacceptable living conditions. They describe a disgusting environment filled with cockroaches, bedbugs, and rodents. Along with these pests, the tenants are reportedly struggling with serious water leaks and persistent mold. Perhaps the most notable detail of this story is the fact that this landlord is a church – and the tenants are its congregants. 

The plaintiffs state that after complaining about these living conditions, the church tried to pressure them into signing a non-disclosure agreement (NDA). They also say that the church representatives continuously assured the tenants that they would address the pests and mold, although they never did so. 

A lawyer representing these clients states that while landlords often put profits ahead of tenant safety, it is rare to see a church engage in this type of behavior. One of the tenants is a 95-year-old disabled woman, and she allegedly donated a considerable amount of money to the church over the course of her life. As per the Daily Journal, church officials declined to comment on the situation. 

How Many Churches are Landlords?

These lawsuits expose church involvement in commercial real estate – something that many Americans are unaware of. So, how common is this type of business activity for US churches? Nonprofit Quarterly notes that many churches sit on valuable pieces of land, but there are considerable ethical issues when religious organizations become landlords. 

The Goal of the Universal Life Church’s Blog

Each month, various cases test the nature of religious rights in this country. While the basis for many religious rights is the United States Constitution, there are still countless cases that question the exact nature of these rights. The Universal Life Church’s blog is focused on documenting the most noteworthy of these cases in an objective manner that can be easily understood by readers.