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CajunRick
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Posted: Wed Feb 28th, 2007 01:43 pm |
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San Diego, Feb 28, 2007 / 10:08 am (CNA).- Following a failed final attempt at settling clergy-abuse claims, the Roman Catholic Diocese of San Diego filed for Chapter 11 protection just before midnight last night, according to the San Diego Union Tribune. The filing makes San Diego the largest of five U.S. dioceses to declare bankruptcy.
The diocese’s action halts the first of about 150 lawsuits alleging sexual abuse of children by 60 priests in incidents dating back decades. The chain of lawsuits was set to begin today.
In a statement, Bishop Robert Brom said the goal of the filing was to allow for a fair dispersal of monies to all victims. Brom said that despite the requests of a Los Angeles judge to stall the filing, it was necessary to take the step before the first case could begin, “because early trial judgments in favor of some victims could so deplete diocesan and insurance resources that there would be nothing left for other victims.”
Diocesan attorneys had met with Judge Anthony Mohr and attorneys of the plaintiffs on Monday to discuss a settlement. Though he did not mention exact numbers, diocesan attorney Michael Webb said the diocese offered plaintiffs “a staggering amount of money,” which amounted to “the highest offer any diocese has made in terms of absolute dollars.”
“It was the final offer,” Webb said, “it was everything we were able to muster.”
“We put money on the table that would have stretched our financial capability to the limit,” Brom said in his statement, “but demands were made which exceeded the financial resources of both the diocese and our insurance carrier.”
In its brief electronic filing, the diocese said it had assets of more than $100 million, but estimated debts of more than $100 million. The San Diego claims, dating back to the 1950s, could cost more than $200 million to settle, plaintiffs told the Union-Tribune.
The Bishop said that the diocese plans to present to the court, “an accurate statement on available diocesan assets and we will propose a comprehensive plan for compensating the victims and hearing their cases.”
At the same time, the bishop continued, “we will be disclosing the names of those accused…as well as the extent of their abuse, and we will verify that no known abuser is functioning in ministry.”
The diocese, he emphasized, will continue to “reach out with pastoral concern and care to victims of sexual abuse and their families, and to promote healing and reconciliation with them,”
The San Diego bankruptcy filings follow those of Dioceses of Tucson, Arizona; Spokane, Washington; Davenport, Iowa; and the Archdiocese of Portland, Oregon.
Tucson which filed for bankruptcy in 2004 has already emerged from its settlement, and settlement agreements in Portland and Spokane are awaiting final approval.
The above article is reposted with permission from the Catholic News Agency.
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JillD
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| Joined: | Fri Sep 29th, 2006 |
| Location: | Visalia, California USA |
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| First Name: | Jill | | Gender: | Female | | Faith History: | heathen, EvFree, Messianic, LC-MS, Catholic 2007 |
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Posted: Wed Feb 28th, 2007 01:50 pm |
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| What are the repercussions when this happens?
____________________
"I praise you, for I am wondrously made. Wonderful are our works! My frame was not hidden from you, when I was being made in secret." Ps 139
"Guard me, O Lord, from the hands of the wicked; preserve me from violent men." Ps 140
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CajunRick
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Posted: Wed Feb 28th, 2007 02:27 pm |
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JillD wrote: What are the repercussions when this happens?
Chapter 11 bankruptcy allows for debt reorganization. The agency filing bankruptcy has their debts put on hold until new payment arrangements can be made. In addition, any additional debt (such as the proceeds of a lawsuit) are placed in the back of the line for payment, so the agency has the opportunity to pay its current outstanding obligations before paying any additional obligations.
In this type of situation, a judgment against the diocese (if it had not filed bankruptcy) that is larger than the assets of the corporation could force it to sell churches and other assets, or possibly even to dissolve under Chapter 7 of the bankruptcy code. It is even possible, without the bankruptcy filing, that the first plaintiff to win a judgment could seize schools, churches, and cathedrals, and sell off art, mass implements, etc. The Church cannot allow that desecration of sacred buildings and implements. In such a case, the police would show up and lock everyone out, so there would be no protection for the Blessed Sacrament, sacred mass vessels, etc.
So filing Chapter 11 allows the diocese, first of all, to assure that it can continue to operate, and second, that existing debt will be paid.
It may sound cruel, but the fact is that if a lawyer wins a lottery jackpot of $200 million or more, it will exceed the assets of the diocese and no one else would get anything. This way, lawyers are forced to accept reduced payments, and everyone will get a reasonable settlement. It will probably delay payments, but the lawyers would have seen to it that almost everyone would get nothing. The only financial losers are the one individual who would have won the first huge award, and the lawyers.
So it's really the right, fair, and equitable thing to do. It protects the assets of the diocese, and insures that all of the plaintiffs (including future plaintiffs) will get a just settlement.
(DISCLAIMER: I am not an attorney, but I do have some general experience with tax law, so this may not be precisely correct, but it captures the general gist of the process. Any attorneys present are welcome to correct any misstatements I may have made.)
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Steven Barrett
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| Joined: | Tue Nov 14th, 2006 |
| Location: | Hadley, Massachusetts USA |
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Posted: Wed Feb 28th, 2007 03:48 pm |
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News like this will keep the secularists dancing for joy. There'll be snickers, recriminations, finger-pointing and enough blame to shovel around for years to come.
But wait a minute! Filing for Bankruptcy protection in this case isn't anywhere nearly as shameful as an individual or couple who recklessly lived beyond their means, only to turn to the courts to shuck off their moral responsibilities.
Nor is the SD diocese. Let's face it, there's only so much money to pay out settlements with. The Church will make as good as She is capable of making good on her responsibilities. But God doesn't print the money. He lets the government do that.
Just as the Vatican views time in centuries, the SD diocese is likely to do the same. If it hadn't taken the prudent step of filing for protection from people trying to pile on and take advantage of the diocese's situation caused by people who aren't even around today, the faithful would have been greatly disserved in terms of whatever the diocese could do for them in the future.
I'm not doubting there are cases of egregious misconduct which should be compensated for. On the other hand, the diocese has churches and schools to keep open, not to mention other worthy area ministries. Just because of a relatively few rotten apples who marred the church and ruined young lives in the past, the SD diocese shouldn't have to be rolled over every time somebody all of a sudden thinks he was sexually abused in the past; only to be convinced he was by lupine lawyers.
Let's not forget the alleged (and proven bogus) claim of sexual abuse thrown at the late Joseph Cardinal Bernardin.
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James Michael Curley to a young Thomas “Tip” O’Neill -- “Son, it’s nice to be important, but it’s more important to be nice.”
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CajunRick
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Posted: Wed Feb 28th, 2007 03:59 pm |
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Steven Barrett wrote: But wait a minute! Filing for Bankruptcy protection in this case isn't anywhere nearly as shameful as an individual or couple who recklessly lived beyond their means, only to turn to the courts to shuck off their moral responsibilities.
It is a prudent step for any corporation or individual in a debt crisis. Chapter 11 does not forgive any debt. It merely puts the collection process on hold to give time for a reorganization of debt. Ten year obligations with high payments might be converted to a longer term with smaller payments, etc. The diocese will be given a period of time in which to submit a reorganization plan, and when the plan is complete, it submits it to the judge, and then leaves Chapter 11 with the reorganization plan in place.
The judge will appoint someone to oversee the operation of the diocese to make sure that it's current obligations are met and that it is being run properly and effeciently.
If the diocese had not filed Chapter 11, and a huge judgment was placed against it, it becomes the primary responsibility of the corporation to pay the judgment, even if that means leaving employees unpaid, cancelling services, closing churches, laying off workers, etc. The attorney for the plaintiff could seize properties, endowments, retirement funds, and otherwise cripple the function of the diocese. It would essentially go out of business.
Filing Chapter 11 guarantees that the diocese can keep operating, keep issuing paychecks, safeguard investments including funds belonging to parishes, and still offer fair settlements to all of the plaintiffs, instead of just one of them getting a huge sum and the rest being frozen out completely.
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Steven Barrett
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| Joined: | Tue Nov 14th, 2006 |
| Location: | Hadley, Massachusetts USA |
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| First Name: | Steven | | Gender: | Male | | Faith History: | Catholic, Episcopal communicant, Baptist, Catholic |
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Posted: Wed Feb 28th, 2007 05:01 pm |
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 Cajunrick, are you a bankruptcy lawyer? Excellent description of Ch. 11.
I avoided the particulars because of time pressures and it's been a long, long time since I did any real legal writing, even though I used to be aDeputy US Dist. Ct. clerk and earned a paralegal cert.
If The Donald can use Ch. Eleven to protect his Atlantic City casinos, why not one of God's shepherds for nobler reasons? And we know The Donald needs or deserves less protection than those who toil the fields.
(I heard a rumor "on the Street" that St. Peter's eager for the day The Donald shows up at the Pearly Gates and our first Pope gets to say, YOU'RE FIRED. I'll give Trump a benefit of he doubt and predict a long stay in purgatory where his ex's are, but casinos, deals, and bankruptcy protections don't exist. He'd think he was sent to hell. God always has the last laugh!)
____________________
James Michael Curley to a young Thomas “Tip” O’Neill -- “Son, it’s nice to be important, but it’s more important to be nice.”
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CajunRick
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Posted: Wed Feb 28th, 2007 06:03 pm |
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Steven Barrett wrote: Cajunrick, are you a bankruptcy lawyer? Excellent description of Ch. 11.
Thank you. When I was a reporter, a state senator here filed Chapter 11 for one of his corporations, and I got a crash course in all that stuff. I tried to always understand what I was reporting on, and I had a half-hour interview show to learn from. Five years of that program and I learned a lot. He ended up filing Chapter 7 and dropping miliions in debt.
I know the laws have changed, but the basic concept is still the same.
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Truthseeker
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Posted: Wed Feb 28th, 2007 09:56 pm |
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Can someone explain why there were so many abusers during the "certain period of time" that all these abuses took palce? What was it about the time that led to so many abusers/abuses?
An example would be the corruption of past times when the youngest son was kind of automatically put into seminary and not because of a calling. That would lead to less than faithful clergy. What about the current situation?
Laura
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Lord, please make my will your Will!
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CajunRick
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Posted: Thu Mar 1st, 2007 12:31 am |
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Truthseeker wrote: Can someone explain why there were so many abusers during the "certain period of time" that all these abuses took palce? What was it about the time that led to so many abusers/abuses?
An example would be the corruption of past times when the youngest son was kind of automatically put into seminary and not because of a calling. That would lead to less than faithful clergy. What about the current situation?
We have dealt with this before, but the essential problem was that young men entered the seminary out of eighth grade, before ever having a chance to discover their sexuality, and spent their teen years in the company of other boys. This was an attractive lifestyle for a young man with same sex attraction, who would have been an oddball in a normal high school if he was not interested in girls. The overwhelming majority of abusive priests have been those who entered the seminary from the 1940's to the early 1970's, when high school seminaries were pretty much abolished.
The system worked as long as there were lots of priests, because few priests were ever assigned to a parish alone while in their 30's and 40's, but the shortage of priests starting in the 1970's changed that. Suddenly 35 year old priests were pastors, living alone in the rectory, with an available pool of altar boys to choose from, and parents that often encouraged their sons to spend the night with Father hoping that they might become priests.
Couple that with the recommendations of psychologists in the 1980's that priests had been "cured" of their disordered inclinations, and the bishop's willingness (on the advice of the professionals) to return them to parish ministry, and you have the result of the abuse scandals.
There have been very few cases of abuse by priests who entered the seminary after high school, as is the current practice. Also, the Church now requires all candidates for the priesthood to undergo psychological counseling prior to ordination specifically to eliminate those who might have abusive potential. Of course, nothing is perfect, but the situation with younger priests is dramatically improved.
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