What was the name of the movie with the crazy druid nanny and the bleeding tree at the end?

This couple has a kid and hires the nanny. The nanny runs off with the baby to feed it to this big ugly demon tree. Baby daddy shows up with a chainsaw and kills the tree. As he's cutting the tree it gushes blood everywhere. I think this movie came out around '88-'89. Help me please. Nobody seems to know this one.