BishopAccountability.org
	Land Deal Is Voided, Builder Says By Mark Sauer and Sandi Dolbee Union-Tribune [San Diego CA] July 13, 2007 http://www.signonsandiego.com/news/metro/20070713-9999-1m13diocese.html A developer's attempt to back out of a $65 million land deal is jeopardizing a significant portion of the money pool which the Diocese of San Diego was counting on to settle the scores of lawsuits involving sexual abuse by priests that caused church officials to declare bankruptcy this year. In a hearing yesterday before federal Judge Louise DeCarl Adler, an attorney representing Lyon Homes said that because the diocese had failed to meet a contractual deadline, its agreement to buy the University of San Diego High School property in Linda Vista is void. In rare agreement, lawyers representing the Roman Catholic diocese and those who sued on behalf of those who claimed sexual abuse said the default cited by Lyon did not exist and the $65 million contract must be honored. Noting that the sales dispute would have to be litigated elsewhere, Adler approved a diocese request to allow the deal, which had been in escrow, to be finalized. "It's hard to say" if the deal is dead, diocese attorney Micheal Webb said. Lyon, which had put down $6.5 million in the deal after it was agreed upon in 2005, planned to build 533 condominiums on the rolling, 14-acre plot across from USD. If the deal is a bust, the diocese could sue the developer to perform on the contract, or put the property up for sale again in a down market. In another matter, Adler approved a motion by the diocese to set a deadline for filing claims of abuse. The exact "bar date" has yet to be determined, but it will be about Feb. 1, lawyers said. Diocese attorneys saw this as a victory since part of the diocese's purpose in filing for Chapter 11 bankruptcy protection was to establish a fixed number of claims for settlement. But attorneys representing the roughly 150 people who have already filed lawsuits called the diocese's arguments against allowing exceptions to the bar date "cynical." Contentiousness was also apparent in court papers filed this week. A committee representing those who have claimed abuse expressed frustration at learning that the diocese has 21 construction projects planned at a cost of about $1 million per month. Work has not begun on any of the churches, schools and other buildings. Attorney James Stang criticized what he called the diocese's "Chicken Little strategy" of casting each construction project as an emergency. He wrote that the parishes may be "soliciting restricted gifts for these projects and thereby diverting monies that could be donated without any restrictions and potentially available to bring this case to a conclusion." Webb and Monsignor Steven Callahan, the diocese's vicar general, denied Stang's contention. "I'm not aware of that going on at all," Callahan said. Adler expressed hope that a settlement regarding the value of the sex-abuse lawsuits could be reached in ongoing mediation before a federal magistrate. Adler noted the two sides have between now and the week of Aug. 13 in which to come to agreement. "If not, the court will have to consider what's next," Adler said. An Aug. 23 hearing is set on whether Adler will send dozens of the lawsuits back to state court for juries to determine their values. Mark Sauer: (619) 293-2227; mark.sauer@uniontrib.com
Any original material on these pages is copyright © BishopAccountability.org 2004. Reproduce freely with attribution.