Judge Sets Hearing on Diocese Request for Deadline on Abuse Claims

By Sheryl Kornman
Tucson Citizen [Tucson AZ]
September 29, 2004

A federal bankruptcy judge yesterday rejected the Catholic Diocese of Tucson's request to immediately set a 90-day time limit for sexual-abuse claimants to come forward.

Judge James M. Marlar set a hearing on the issue for Oct. 25 so the proper 14-day notice can be given.

The burden of a growing number of sex-abuse cases filed in civil courts led the diocese to file for Chapter 11 bankruptcy protection Sept. 20. The aim was to limit the number of such cases that can be filed.

Marlar told lawyers for the diocese and the existing claimants more than once to work together to "expeditiously" resolve the various disputes in the case outside the courtroom.

He also told them to use "alternate dispute resolution" and to avoid "long, drawn out, costly and emotional trials."

A claimant has the right to ask for a jury trial in a bankruptcy matter.

The judge also asked the diocese's attorneys to submit a "proof of claim," the document that future claimants will be required to use to file for compensation from the diocese.

Marlar appeared pleased with the initial filings by the diocese that will keep it operating as usual while the reorganization is under way.

"It sounds like cash management is not an issue," Marlar told Susan G. Boswell, the diocese's lead bankruptcy attorney. "People are cooperating. Information is available to all interested parties."

Whether the assets of the parishes will come into play to settle sex-abuse claims is not yet known.

The diocese did not list them as assets in its Chapter 11 filing.

But the judge asked the attorneys for the parishes to provide him a list of all parish properties in one document although the parishes assert they are all individually owned.

Tucson diocese Bishop Gerald Kicanas has said the parish properties are held in trust by him for the parishioners by church law and cannot be used to settle claims of sexual abuse.

Michael McGrath, who represents the parishes, said after the hearing yesterday he has no immediate plan to incorporate each parish individually.

He said he may do so at some point, if an effort is made to include parish property as assets of the diocese.

Under church law, or canon law, the parishes are not diocese property, he said.

The diocese noted its assets at $17 million and liabilities at $21 million in court documents. Its asset list does not include the parish properties in the nine-county diocese.

"I'm very encouraged," Fred Allison, spokesman for the diocese, said after the hearing. The work of Bankruptcy Court is "building relationships to arrive at solutions."

Tucson attorney Lynne Cadigan said she was told by the judge in a civil diocese sex-abuse case in Yuma that he would allow Marlar to decide whether that case should go forward.

In that case, Cadigan represents three boys and their mother. Cadigan said she has not filed a motion with Marlar asking that the case be heard


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