Bankruptcy

Catholic Diocese Chooses Chapter 11 Bankruptcy

By J. Michael McBride

With “more than 150 claims were filed against the church, alleging abuse by clergy or church workers“ the Catholic Diocese of Fairbanks plans to file for Chapter 11 bankruptcy. Bishop Donald J. Kettler believes it’s the “best way to bring all parties together and to provide for fair and equitable treatment of all who have been harmed.”

While settlement negotiations have failed due to the insurance carrier’s less than motivated participation and high legal fees, bankruptcy filing was soon to be on the horizon.

“In November, a Roman Catholic religious order agreed to pay $50 million to more than 100 Alaska Natives who alleged sexual abuse by Jesuit priests. The settlement with the Oregon Province of the Society of Jesus was the largest one yet against a Catholic religious order.

However, the cases did not include those against the Diocese of Fairbanks, which owned and managed the churches in the villages in rural Alaska where the Jesuit priests were assigned.”

“The Fairbanks diocese is the nation's largest geographically, extending to more than 400,000 square miles. It is the only diocese in the United States to fall under the Catholic Church's missionary wing.”

One comment made is “Perhaps the Bankruptcy Code can be revised to prevent dioceses from skirting their responsibilities. The gov't made it more difficult for John Q Public to file bankruptcy when more often than not, their debts were from catastrophic medical concerns and job loss, neither an intentional reneging of their financial obligations.

The churches are looking to skirt away from paying for the intentional (and criminal) acts of its representatives. Just another way that religion gets a free pass that is inapplicable to others not similarly situated.”

You can read the full article (and comments) at:
http://www.usatoday.com/news/nation/2008-02-14-alaska-diocese_N.htm?csp=34&POE=click-refer

Michelle

Full post as published by Texas Lawyer Blog on February 18, 2008 (boomark / email).