Catholic Diocese of Norwich files Chapter 11 plan with $30 million survivor fund

The Roman Catholic Diocese of Norwich and its parishes, along with its insurer Catholic Mutual Relief Society of America, have filed a joint Chapter 11 reorganization plan as the diocese tries to emerge from bankruptcy.

The plan includes a $30 million trust fund for clergy sexual abuse survivors. Contributions to the proposed fund would include $3 million from the diocese and its parishes, $4.8 million from Catholic Mutual and millions in proceeds from the sale of several school properties, including land at St. Bernard’s which sold for $6.5 million and the Xavier property. for $2.5 million.

The diocese filed for bankruptcy in July 2021, citing as many as 60 sexual abuse lawsuits against it. Since then, it has received approximately 142 additional requests from abuse survivors.

The diocese says the plan is meant to allow it to emerge from bankruptcy to continue its mission while providing recovery to sex abuse plaintiffs.

More than a year ago, the diocese and the Official Committee of Unsecured Creditors, which represents sexual abuse plaintiffs, sought bankruptcy court approval for an agreed-upon $29 million reorganization plan. However, the survivors’ committee withdrew from that plan on June 27, filing its own plan that the diocese maintains will result in years of litigation and uncertainty for the plaintiffs.

Last month, U.S. Bankruptcy Judge James J. Tancredi gave the diocese the opportunity to file its own plan as an alternative to the survivors’ committee plan.

The Diocese of Norwich covers four counties in eastern Connecticut and serves approximately 230,000 Catholics.