The catholic church comprehends all that profess the true religion. There is a lawful and necessary division of it into sections in respect of local situation. But when a number of people, bearing the christian name, combine together as a distinct society, for the purpose of maintaining and propagating doctrines and practices, which, instead of belonging to the true religion, are contrary to it; they ought not, considered as such a combination, to be called a lawful section of the catholic church. It is not denied, that they belong to the catholic church; but it is denied, that there ought to be any such section or division in it. Thus, there ought to be no section of the catholic church, having for the peculiar end of its distinct subsistence, the support of an episcopal hierarchy, unknown in the scripture, or the propagation of antipaedobaptism, or of antiscriptural doctrine, in opposition to that of God's election, redemption, effectual calling and the conservation of his people, as delivered in the scripture; or for the support of ways and means of divine worship not found in scripture. If the catholic visible church were brought to a suitable discharge of her duty, she would abolish all such sections. But no society ought to be called such an unlawful section, while it can be shewn that it subsists as a separate society for no other end, than for the maintaining of something in the doctrine, worship or government of the church which belongs to the christian religion as delivered in the word of God, or for exhibiting a testimony against prevailing errors and corruptions which the scripture requires the catholic church to condemn. Such a profession of any party of christians is no sectarian profession; and an union with them is not a sectarian, but properly a christian union; and, being cordial and sincere, is a union in Christ; and communion upon the ground of this union is truly christian communion. On the other hand, however much of our holy religion any body of christians hold in common with others, and however many of them we may charitably judge to be saints, yet while their distinguishing profession is contrary to the word of God, communion with them as a body so distinguished, is sectarian communion; as it implies a union with them in that which ought to be rejected by the whole catholic church.
For more, see here and here.