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Boston Diocese Mulls Bankruptcy

Dec 5, 2002 | UPI

A key church finance panel has given Cardinal Bernard Law unprecedented authority to file for Chapter 11 bankruptcy protection as the Roman Catholic Archdiocese of Boston faces hundreds of clergy sex-abuse claims.

The archdiocese said Thursday, however, it would prefer mediation to bankruptcy to settle some 450 suits.

"We believe a mediated resolution would be preferable to seeking Chapter 11 protection and remain hopeful that this process currently under way will be successful," archdiocese spokeswoman Donna M. Morrissey said in a statement.

"However, we feel it is also necessary to carefully consider the alternative or complementary approach of a Chapter 11 reorganization."

The 15-member Archdiocesan Finance Council late Wednesday gave its approval to the bankruptcy option, reportedly supported by Law, but Morrissey said the cardinal has not decided whether to file Chapter 11. He still needs to seek approval from the Vatican, she said.

The vote is the closest any archdiocese in the United States has come to filing for bankruptcy.

Such a filing would give a secular bankruptcy judge unprecedented access and control over the archdiocese's finances and would put all litigation on hold.

Attorneys for alleged abuse victims say the bankruptcy option is designed to pressure plaintiffs to settle.

"It has become apparent the leaders of the Archdiocese of Boston are using the threat of bankruptcy as leverage in the mediation process," said Mitchell Garabedian, an attorney for a number of alleged victims.

Two other attorneys involved in talks with the archdiocese said they were committed to getting fair deals for their clients.

"If Cardinal Law himself is truly telling us he would prefer settlement to bankruptcy, then we stand committed to being the strong engine behind a fair deal for all victims of abuse," said attorneys Roderick MacLeish Jr. and Jeffrey A. Newman.

"We certainly hope bankruptcy is not truly the direction the cardinal chooses," they said in a statement.

However, if he does, they said they "look forward to seeing him explain before a judge why he should keep his palatial home while the wounded victims of his priests lie around the battlefield."

The finance panel vote came a day after thousands of secret church documents were released under court order detailing how Law and other church officials were more deeply involved for decades in covering up for abusive priests than previously admitted.

The disclosures have prompted increased calls on Law to resign, something he has refused to do.

One group formed in the wake of the clergy sex scandal, the Voice of the Faithful, was expected to consider calling for Law's resignation at its upcoming meetings.

James E. Post, the group's leader, told The Boston Globe that the newly released documents show a "picture of covering up ... a picture of keeping from public view this moral depravity."

Other Boston Catholic leaders such as advertising executive Jack Connors Jr. said it is time for Law to resign, that it would be a "mistake for him to attempt to lead after all these disclosures."

"Law has a personal responsibility to do whatever he can to repair the grievous damage already done to the archdiocese," the Globe said in an editorial Thursday. "His resignation would be the right thing to do."

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