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	Check to Diocesan Bankruptcy Claimants to Come in November By Ann McGlynn Quad-City Times October 6, 2008 http://www.qctimes.com/articles/2008/10/06/news/local/doc48eacb99050f2221921735.txt Sex abuse survivors who filed claims in the Diocese of Davenport's bankruptcy will receive a check in November toward their portion of the $37 million settlement, the former co-chairman of the creditors committee said Monday. More money is anticipated once the sale of the St. Vincent Center is complete, said Mike Uhde. A recovery of payments the diocese made — payments of more than $500,000 to a variety of organizations in the three months before it filed for bankruptcy — could also result in more money for survivors, he said. "We sincerely hope to have the property sold and the payments recovered in a timely fashion so that these funds may also be distributed to victims of childhood sexual abuse suffered at the hands of Diocesan personnel and covered up by Diocesan officials," Uhde said in a news release. The sale of the St. Vincent Center property on Central Park Avenue is the largest outstanding monetary issue of the bankruptcy. The property serves as the diocesan headquarters and is valued at $3.9 million. The headquarters remains there, "with the understanding that the diocese and/or St. Ambrose University would pay the agreed upon valued price for the property," Uhde said. However, diocesan officials say there was no such agreement. "The diocese is occupying the property under a lease with the settlement trustee," said Dick Davidson, attorney for the diocese. "The diocese pays for all the upkeep and insurance, which amounts to $200,000-plus a year. The diocese can be asked to leave upon 90 days notice by the settlement trustee." Additionally, the bankruptcy settlement's trustee also is attempting to recover more than $500,000 in "preferential" payments made by the diocese in the 90 days before the diocese filed for bankruptcy, Uhde said. The payments were made to organizations that include the U.S. Conference of Catholic Bishops, the Apostolic Nunciature, the Church of Latin America, Catholic Relief Services, Catholic Campaign for Human Development, the Church of Central America and the Commissariat of the Holy Land. Those payments, Davidson said, were disclosed to the bankruptcy court and creditors committee. "The vast majority of the payments represent special collections that the parishes took up for various Catholic charitable organizations, such as Catholic Charities," Davidson said. "In those instances, the diocese acts as a pass-through agent, receiving the money from the parishes and sending it on to the appropriate organization. The other payments referenced constitute dues payable by the diocese to other Catholic organizations and are part of a normal payment process." Davidson continued: "The process of recovering 'avoidance actions' is a normal part of the bankruptcy process, and it does not mean that there was anything wrong, underhanded or fraudulent with the making of any particular payments, but rather that the payment is 'avoidable' under some very arcane bankruptcy concepts that are difficult for even sophisticated business people to understand." The Davenport diocese filed for bankruptcy in October 2006 after it lost its first civil sex abuse trial. The diocese, its insurance company and the creditors committee agreed to a $37 million settlement, with the stipulation that all Catholic entities in the diocese will be released from liability just as the diocese is. Ann McGlynn can be contacted at (563) 383-2336 or amcglynn@qctimes.com
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