Archbishop: Church Will Resist Ruling

By William McCall
Associated Press, carried in Corvallis Gazette-Times
January 8, 2006

PORTLAND — The leader of the Roman Catholic Archdiocese of Portland says the church will follow its own law on ownership of its property despite a ruling by a federal bankruptcy judge declaring it potentially subject to sale to satisfy claims by victims of alleged priest sex abuse.

Archbishop John Vlazny told the Catholic Sentinel that he considers church buildings and land the property of individual parishes, not the archdiocese.

His comments to the religious newspaper directly contradict a Dec. 30 ruling by U.S. Bankruptcy Judge Elizabeth Perris, who said that property was controlled by the archdiocese.

Her ruling means that parish and Catholic school real estate "worth hundreds of millions of dollars can be tallied when the court decides how much claimants will be paid,'' the Catholic Sentinel said.

The Portland archdiocese was the first Catholic diocese in the nation to declare bankruptcy when it sought protection from creditors in July 2004.

The ruling by Perris supported a similar ruling by U.S. Bankruptcy Judge Patricia Williams in Spokane, Wash., where the church filed for protection after the Portland archdiocese.

Like Perris, Williams said the church agreed to abide by federal law by entering into bankruptcy, and cannot claim that property ownership must decided by church law.

But Vlazny told the Catholic Sentinel the church will follow its internal law on property ownership, "no matter what obstacles confront it.''

Attorneys on both sides of the case are involved in settlement talks. They have declined to comment on details, but agree the issue of the sale of any church property remains to be discussed only if necessary.

The Portland archdiocese has offered more than $40 million to settle the case, but Erin Olson, an attorney for alleged abuse victims, has called that offer "dead on arrival.''

Creditors are crafting their own settlement plan to present to Perris.

The archdiocese and its insurers had already paid $53 million to settle more than 130 claims before the bankruptcy, officials said.

Meanwhile, the Spokane ruling is under appeal and attorneys for the Portland archdiocese are considering an appeal of the ruling by Perris.

Her ruling also left open the question of whether any sale to satisfy creditors would violate the Religious Freedom and Restoration Act of 1993 by placing an "undue burden'' on the 400,000 Catholics in Western Oregon.

Vlazny told the Catholic newspaper his position is firm. He said church law forbids him from seizing parish assets.

"Parish property belongs to the parishes,'' he said.


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