A lawsuit has been filed by the official committee of unsecured creditors against the Archdiocese of Agana that seeks to include all of the island’s Catholic schools, churches and other parish properties as assets which could be sold off to satisfy creditor demands in the archdiocese's bankruptcy case.

Included in the lawsuit is a list of disputed properties which the unsecured creditors committee alleges “should be scheduled as property of the estate.”

The list includes the Dulce Nombre de Maria Cathedral-Basilica which the committee valued at $9.5 million. All parish churches and schools are also on the list, as well as owned vehicles. Even the Pigo and Agat cemeteries are on the list.

“The debtor owns the Disputed Real Property,” asserts the complaint.

“The committee alleges that the real property identified ... is in fact under the debtor’s complete control and domination,” states the complaint. The committee represents all of the plaintiffs in the cases alleging decades-old sex abuse by certain members of the clergy. The committee also includes the Bank of Guam and others.

The complaint was filed on Friday by attorney Robert Kugler on behalf of the unsecured creditors.

Response

In response, the archdiocese issued a release Tuesday maintaining that the churches and schools are only held in trust by the archdiocese.

“We believe that the trust relationship is well established by the facts on the ground,” states archdiocese bankruptcy attorney Ford Elsaesser.

That trust relationship, Elsaesser maintains, is “fully supported by the ‘corporation sole’ statute of the Territory of Guam.”

The island's Catholic Church is facing more than 200 sexual abuse lawsuits. On average, each plaintiff is seeking $5 million in damages, which amounts to roughly $1 billion in claims.

In the face of those lawsuits, the Archdiocese of Agana on Jan. 16 filed a petition for reorganization in the District Court of Guam under Chapter 11 of the U.S. bankruptcy code.

Church properties are being sold office to satisfy the claims and one of the most valuable properties owned by the archdiocese is the old Redemptoris Mater Seminary, formally the Accion Hotel.

The archdiocese is awaiting court approval to finalize the sale of that property for $5.4 million, a fraction of what’s needed to satisfy the demands of the plaintiffs.

Elsaesser also argues that “this trust relationship is not only consistent with Canon law within the Church, but also case law.”

“The only ruling from a Court within the Ninth Circuit ... fully supports the trust theory,” states Elsaesser. “We do not believe there is anything specific about Guam law that would support a different analysis,” he said.

The release concludes by stating that the archdiocese is “hopeful that after the lawsuit is answered, the parties will go back to mediation and resolve all issues, including compensation for abuse survivors, before extensive legal proceedings begin and the litigation is commenced.”