Diocese, insurance carrier agree to terms
By John Vlahovich
Spokane Public Radio
Spokane’s Catholic Diocese and one of its major insurance carriers have agreed to settle their dispute over priest sex abuse victim coverage. The carriers will pay five and a quarter million dollars toward the 45 million dollar settlement with victims announced in February.
General Insurance Company of America, now part of Safeco, issued liability policies covering the local Catholic diocese between 1958 and 1972.
Diocesan bankruptcy attorney Shaun Cross says the $5-plus million that the insurance company will pay is a major step in the diocese’s emergence from Chapter 11 bankruptcy. It also ends their legal dispute in U.S. District Court.
But first the settlement has to be okayed by both the U.S. Bankruptcy Court and the Eastern Washington Federal District Court. Cross says the diocese must show judges of both courts it and the victims have both agreed to a consensual settlement plan.
“And in order to have a consensual plan, we need to show at the time of confirmation that we have sufficient funds so that our plan is feasible,” says Cross, “that we can pay the proposed settlement that we have with the 75 victims, and any other settlements that we have with additional victims that have filed claims. When you receive $5 million here, $5 million there, as Everett Dirksen said, pretty soon you’re talking real money.”
General Insurance will place $5.25 million in an interest-bearing bank account. Those funds will be released to the diocese in October 2007. That’s the same month in which the diocese has agreed to settle claims brought by 75 sex abuse victims.
Diocesan officials continue to negotiate settlements with five other insurance carriers. Last week those carriers failed to convince Federal District Court Judge Justin Quackenbush that they did not have a coverage obligation to the diocese.
There are additional sex abuse claimants in addition to the 75 victims offered the $45.7 million settlement by the diocese. The exact number of valid claims is still being determined.
Spokane Public Radio
Spokane’s Catholic Diocese and one of its major insurance carriers have agreed to settle their dispute over priest sex abuse victim coverage. The carriers will pay five and a quarter million dollars toward the 45 million dollar settlement with victims announced in February.
General Insurance Company of America, now part of Safeco, issued liability policies covering the local Catholic diocese between 1958 and 1972.
Diocesan bankruptcy attorney Shaun Cross says the $5-plus million that the insurance company will pay is a major step in the diocese’s emergence from Chapter 11 bankruptcy. It also ends their legal dispute in U.S. District Court.
But first the settlement has to be okayed by both the U.S. Bankruptcy Court and the Eastern Washington Federal District Court. Cross says the diocese must show judges of both courts it and the victims have both agreed to a consensual settlement plan.
“And in order to have a consensual plan, we need to show at the time of confirmation that we have sufficient funds so that our plan is feasible,” says Cross, “that we can pay the proposed settlement that we have with the 75 victims, and any other settlements that we have with additional victims that have filed claims. When you receive $5 million here, $5 million there, as Everett Dirksen said, pretty soon you’re talking real money.”
General Insurance will place $5.25 million in an interest-bearing bank account. Those funds will be released to the diocese in October 2007. That’s the same month in which the diocese has agreed to settle claims brought by 75 sex abuse victims.
Diocesan officials continue to negotiate settlements with five other insurance carriers. Last week those carriers failed to convince Federal District Court Judge Justin Quackenbush that they did not have a coverage obligation to the diocese.
There are additional sex abuse claimants in addition to the 75 victims offered the $45.7 million settlement by the diocese. The exact number of valid claims is still being determined.