Diocese Facing New Trials

By Kevin O'Connor
Times Argus

August 3, 2008

Its accuser is different, but Vermont's Catholic Church faces the same child-sex charges in the same court.

Will it also face the same record $8.7 million verdict?

The state's largest religious denomination, still reeling from a May ruling of negligence in its 1970s hiring and supervision of a pedophile priest, is set to defend itself this month in another trial on claims against the same retired clergyman.

Twenty men have filed civil lawsuits in Burlington's Chittenden Superior Court alleging the statewide Roman Catholic Diocese was reckless for not telling their childhood parishes about past sexual abuse of boys by former priest Edward Paquette, who served in Rutland in 1972, Montpelier in 1974 and Burlington in 1976.

In the first trial last spring, a jury rejected the diocese's defense that it wasn't liable for the priest's misconduct and awarded plaintiff Perry Babel, a 40-year-old Burlington native, $950,000 in compensatory damages and an additional $7.75 million in punitive damages.

The diocese just settled the next pending case filed by a Washington County man identified only as John Doe for $250,000, church counsel confirmed last week.

"We're glad to have that case settled," lawyer Thomas McCormick said. "We'd like to settle them all."

But Jerome O'Neill, attorney for all the plaintiffs, said his client agreed to $250,000 only because he wanted to remain anonymous and didn't want to face a court appearance.

"The diocese was aware of that and therefore was able to resolve the case at considerably less than it would have been worth in the eyes of a jury," O'Neill said.

The next plaintiff scheduled for hearing Thomas Murray, 40, of Waitsfield is ready to testify about abuse he says began when he was a 9-year-old fourth-grader. So unless the diocese is willing to raise its settlement offer, church officials will find themselves in court Aug. 13 for a jury trial that could last two weeks.

Murray, like the plaintiff in the $8.7 million case, was an altar boy at Burlington's Christ the King Church when Paquette "committed unpermitted, harmful and offensive sexual contact" from his arrival in June 1976 to his dismissal in April 1978, court papers say.

The plaintiff's lawyer plans on using the same church personnel records from the last case to show that the diocese transferred Paquette to Burlington without telling anyone it knew the priest had molested boys first in Massachusetts, then in Indiana and the Vermont cities of Rutland and Montpelier.

The diocese so far hasn't disputed any of the accusers' allegations but instead has argued it's not liable, in part because it was following since-debunked advice of psychiatrists who at one point hoped Paquette could be cured through 11 sessions of electric shock therapy.

Both sides have tried to settle all the Paquette lawsuits, but attorneys on both sides acknowledge the plaintiffs consider the diocese's offers too low and the church believes the accusers' requests are too high.

Neither side will say how much they're seeking. But 40-year-old Burlington native Michael Gay, ready to take the witness stand in 2006, received a then-record $965,000 settlement, and 41-year-old South Hero resident John Perrotte, not wanting to face a trial for claims against another priest, accepted a church offer last February of $170,000.

"We are interested in resolving every case," O'Neill said last week when asked about the latest lawsuit, "but it appears unlikely this case can be resolved without a jury."

Letting any Paquette case go to court rather than settling is a gamble for the diocese, which is appealing the $8.7 million verdict to the Vermont Supreme Court.

The diocese doesn't have insurance for priest misconduct, but says it held a comprehensive liability policy with the United States Fidelity and Guaranty Co. from 1972 to 1978. The church can't find its copy of the policy, however, so it has taken the insurer to federal court in hopes the company will unearth the paperwork and pay for the costs associated with the lawsuits.

The insurer, now part of the St. Paul Travelers Companies, has agreed to pay the diocese's legal fees for all pending cases whose allegations took place during the policy period. But the insurer says it shouldn't have to cover costs if it can prove the church knew of past misconduct but continued to employ an offending priest.

U.S. District Court in Burlington has yet to rule on the insurance case. The insurer's lawyer, Mark Errico of New Jersey, declined comment.

Vermont's 118,000 Catholics don't seem to be deterred by the diocese's problems. The annual Bishop's Fund drive which the church stresses is for religious charities and not settlement costs has reached 80 percent of its $2.85 million goal in just two months.

But the diocese faces a long-term financial challenge. It has spent six years and at least $2 million to resolve nine previous misconduct lawsuits, yet it still faces 21 similar cases involving eight former priests.

To protect its local assets, the diocese in 2006 placed each of its more than 120 parishes in separate charitable trusts. That has left its remaining property vulnerable.

Chittenden Superior Court, for example, has placed a lien on the diocese's Burlington headquarters a historic $11 million brick building at 351 North Ave., on land overlooking Lake Champlain to insure it can pay the $8.7 million jury verdict if it's upheld by the Supreme Court.

So many other dioceses with similar problems are filing for bankruptcy in Arizona, California, Iowa, Oregon, Washington they've spawned a new publication, "Catholic Church Bankruptcy News." But Vermont Catholic Bishop Salvatore Matano hasn't said much about how his diocese will pay off its debt other than to announce its appeal of the latest verdict.

"While regretting that legal options still must be considered," Matano wrote priests and parishioners in May, "the amount awarded in this present case seriously challenges the diocese in its ability to resolve the remaining cases and, therefore, does merit review."

Contact Kevin O'Connor at


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