Batavia pastor, church locked in legal dispute over collections, payroll

A pastor and members of a Batavia church are locked in a legal battle over church collections, a ghost payroll allegation and a contract dispute.

Over the past month, Rev. Dernard Newell and members of the Logan Street Baptist Church have filed lawsuits against each other, with the dispute centering on control over dispensing Sunday's church offerings and who had control over the church payroll, according to Kane County court records.

Newell, named pastor in November 2008, and church treasurer Shirley Terrell, filed lawsuits against each other May 12, records show.

Newell's lawsuit argues he discovered in April 2016 that Terrell wrote her son, Aaron, a $750 paycheck in 2014 when he didn't do any work for the church. Newell's lawsuit also argued Terrell committed more "financial improprieties" when she issued her son a W-2 form later used as proof of employment to help buy a home, and obtained a debit card tied directly to an account where monetary donations are deposited.

Newell's lawsuit says he is the only one who can hire employees and Shirley Terrell "blatantly ignored" demands from the church to return the debit card.

"LSBC's funds should not be used by Shirley for her personal or family affairs," read part of the complaint.

Terrell's lawsuit argued that 44 of the church's estimated 100 members authorized a complaint against Newell for his "harmful actions." The suit argued Newell changed the locks on the church's finance office, removed money from Sunday church collections and put it into an unspecified account, worked to "fire" a church trustee and another member, and issued himself a paycheck that was $500 in excess of what he normally was paid.

Terrell's litigation argued for a temporary restraining order against Newell from conducting church business, saying the church's finances will be in "disarray and the confidence of the members will be diminished greatly, resulting in the stopping of all donations and the financial collapse of the church" if an order wasn't granted.

Judge David Akemann on May 13 granted a temporary restraining order against Newell and ordered the two sides to pursue mediation. According to the order, Shirley Terrell will remain treasurer but will be supervised by a deacon and another church member chosen by Newell.

Terrell must provide a copy of each Sunday collection to Newell, who is prohibited from interfering with "collection, control or accounting of donation funds or other church property."

Neither Newell, nor Terrell or her son have been charged with criminal wrongdoing.

Thomas Scherschel, an attorney representing the church, said Tuesday the litigation is continuing and he would have more to say after the next court date July 15.

Newell did not respond to an email and his attorney, Ronald Nolen, had no immediate comment Tuesday.

A message left at the church office was not returned.

Newell also has filed a breach of contract lawsuit, arguing the church failed to pay him some $90,000 and enroll him in a health plan based on a Sept. 25, 2015 "written settlement agreement." Newell is acting as his own attorney in this lawsuit, which is next due in court Aug. 4.