One Canadian Anglican diocese may declare bankruptcy and a second is facing “grave” financial difficulties as lawsuits over Native residential schools progress through the courts.
The Diocese of Cariboo is considering declaring bankruptcy after a judge recently found it negligent in the sexual abuse of a boy at a Lytton, B.C., residential school nearly 30 years ago. Floyd Mowatt sued the diocese, the national church and the federal government for damages as a result.
Justice Janice Dillon of the B.C. Supreme Court found all three parties jointly liable for undisclosed damages. The church is responsible for at least 60 per cent of the award believed to be about $200,000. That figure does not include legal and court costs.
The Anglican Church still faces more than 200 lawsuits involving hundreds of plaintiffs. The Diocese of Qu’Appelle in southern Saskatchewan owes $134,000 in legal bills and will cash in some available trust funds to pay them off.
The Lytton judgment, handed down Aug. 30, presents a damning indictment of the church’s role in allowing a man with no child-care experience free and unsupervised rein of the children in his care at St. George’s Indian Residential School. It is the first decision involving residential schools and the Anglican church. (See related story below for excerpts from the judgment.)
The church had not decided by press time whether to appeal the decision that held the federal government responsible for only 40 per cent of the damages. However, General Secretary Jim Boyles says the church will pay its share of the compensation now.
“The plaintiff has suffered abuse,” Mr. Boyles said in an interview. “The court has validated the claim and it’s just and fair that he receive the compensation.”
The amount of damages had been decided before the trial began in May 1998 but the parties agreed to keep the amount confidential.
The question before the court was not whether there was wrongdoing but who the employer was and who should pay the damages. Derek Clarke, a residence supervisor at St. George’s, sexually abused the plaintiff during the years 1970 to 1973. Mr. Clarke had already been found guilty of abusing several boys in a criminal trial and is in jail.
The church argued in court that the federal government owned and administered the residence during the years the plaintiff was abused. But Justice Dillon said that although the government took over ownership of the residence, the church continued to run the day-to-day operations and hire staff.
Bishop James Cruickshank of Cariboo – who has been advised not to speak to the media since several cases involving the same child-care worker are pending – wrote a pastoral letter to all parishes. He compared the situation to a house being renovated, causing stress, confusion and disruption.
“However, in the end, everything seems to come together,” he wrote. “Some of the things which are familiar to us now will no doubt change. But I believe, as a result of all of this, our church will be stronger than ever.”
Bishop Cruickshank said that while the shape of the diocese might change, each congregation will remain and will be served by their priest.
Speaking for the diocese, Archbishop David Crawley said Cariboo does not have enough liquid assets to pay its 50 per cent share of the damages and legal and court costs owing. Archbishop Crawley’s region includes the Diocese of Cariboo.
He said a meeting had been called to discuss possible plans of action. Options, including bankruptcy, are being investigated. For example, if the diocese declares bankruptcy, can the courts seize parish property to pay the bills or not?
“Above all, we must protect the parishes,” Archbishop Crawley said. “We are in it for the long haul. Buildings come and go but the worship community continues.”
He said he is unaware of any precedent for a diocese declaring bankruptcy in Canada although a Roman Catholic diocese did so in the United States.
Archdeacon Boyles said the national church and the Diocese of Cariboo have been splitting legal costs 50-50 but they won’t necessarily pay damages on that ratio. The court judgment seems to suggest a larger proportion of the liability lies with the diocese, Mr. Boyles said. However, Cariboo has limited resources to meet its obligations, he added.
In the Diocese of Qu’Appelle, Gordon’s residential school is the subject of numerous lawsuits. Until now, General Synod has covered the legal bills associated with that school. But the diocese is to pay half the costs and the first payment is due, Bishop Duncan Wallace told parishes in a pastoral letter to be read to parishes in September. He called it a “grave matter.”
The diocese will begin to collapse a few unrestricted trust funds, the bishop said, adding that those funds will eventually run out.
“Of even greater gravity in this matter is the potential for hurt and damage to people; for racism (on all sides) to raise its ugly head,” Bishop Wallace said. “This matter may be with us for many years to come. Let us work and pray so that it does not drive us to hatred and suspicion and mistrust, nor to despair. Rather, let us pray that the Lord God will help us to find a therapeutic, healing way to deal with the matter and that the Lord our God will lead us all to a just and restorative end.”
