Judge files diocese bankruptcy plan
Two legal documents filed Thursday made it official: Judge Lee Jackwig approved the bankruptcy plan of the Diocese of Davenport.
The 31 pages of orders back up her verbal ruling Wednesday afternoon that gave the go-ahead to the $37 million settlement that will allow the diocese to emerge from bankruptcy, provide a release from liability for all diocesan parishes and schools from sex abuse claims and will provide money to the more than 150 people who filed claims of sex abuse.
The plan will be effective in about 30 days, officials said, and that includes the diocese relinquishing the deed to its headquarters, the St. Vincent Center.
The orders also confirm one of the things Jackwig focused on Wednesday: the 18 nonmonetary agreements. She called them “right on target” and urged Bishop Martin Amos to actively pursue them. She requested a report once a year for three years on the diocese’s progress.
The “nonmonetaries,” as those involved with the plan call them, are specific requests of survivors. They include:
The bishop publicly supporting a complete elimination of all criminal statutes of limitation for sex abuse committed by clergy or others in authority.
All priests working in the diocese, as well as the bishop, will submit a written statement acknowledging they have not sexually abused any minor and have no knowledge that any other priest or employee of the diocese has done so or that such knowledge has been reported to the appropriate authorities.
The names of priests credibly accused will be publicly announced.
Victims will be allowed to speak in the church in which they were abused and given space in the Catholic Messenger, the diocesan newspaper, to share their story of abuse. The bishop also will visit parishes where abuse occurred.
No one from the diocese will refer to the claimants as “alleged” cases.
Each school in the diocese will be required to display a plaque stating that “the abuse of the spiritual, emotional, and moral development” of students will not be tolerated.
The diocese must make a full report for action to be taken against retired Sioux City Bishop Lawrence Soens, who was a priest in the Diocese of Davenport accused of sex abuse. He is the only clergy specifically named in the plan.
Michl Uhde, whose successful lawsuit triggered the bankruptcy, testified Wednesday he thinks lay Catholics should support change in their church. The leadership in the diocese, he thinks, is going to help support change to prevent abuse.
“Some people are now in charge, in at least this diocese, who respect the rights of children,” he said.
Other information revealed at the hearing Wednesday included:
Three of the four parishes that agreed to give money to the settlement gave the full amount requested by the diocese, testified Char Maaske, chief financial officer for the diocese. The fourth, Our Lady of Lourdes, did not. She did not say how much the diocese requested of Lourdes, but the church will give $250,000. It will borrow money to meet the obligation, she said.
The parishes the diocese asked to give money had significant liquid assets and severe claims, she said. Besides Lourdes, $1 million will come from Sacred Heart and St. Anthony’s in Davenport and $650,000 from St. Mary’s in Iowa City. St. Vincent Home Corp., a diocesan charity, will provide $3 million.
Giving to the diocesan annual appeal has not decreased as the bankruptcy proceeded, Maaske said. “What I understand is that people are giving as they have in the past,” she said.
A $2 million loan from Quad-City Bank & Trust that will go to help pay the $37 million settlement will be interest only with a principal payment in five years, Maaske said.
Six additional claimants cast their ballots in favor of the plan in the past several days, said Dick Davidson, attorney. That brings the total ballots to 148 of the claims filed, either 156 or 162 depending on whether late-filed claims will be accepted. Of those 148, 147 said yes to the plan. One said no and chose to take his case to Scott County District Court against the bankruptcy trustee.
Approximately 50 claimants participated in anonymous conference calls to explain the reorganization plan last week. Four people came to a face-to-face meeting held in Iowa City. Four or five came to a similar Davenport meeting.
The diocese filed for bankruptcy in October 2006 after it lost its first civil sex abuse trial. The lawsuit was brought by Uhde, who was awarded $1.5 million by a Scott County jury, double what he requested, for abuse he suffered as a child by the late Monsignor Thomas Feeney. A second lawsuit by Florida resident Michael Gould was set to go to trial.
The diocese, Travelers insurance company and the creditors committee agreed to a $37 million settlement, with the stipulation that all Catholic entities in the diocese were to be released from liability just as the diocese will be released once the bankruptcy process is completed. The entities will relinquish their Travelers insurance policies, all dating from before 1996.
Travelers is to pay $19.5 million, the deed to the diocese-owned St. Vincent Center valued at $3.9 million is to be turned over to the bankruptcy trustee and the diocese is to pay $13.5 million.
Ann McGlynn can be contacted at (563) 383-2336 or amcglynn@qctimes.com. Comment on this story at qctimes.com.