Will Sex Abuse Claims Bankrupt the Vatican?

Pope Francis’ heavy-handed rebuke of US sex abuse reforms could end up with some Saudi prince owning St. Peter’s Basilica.

By Christopher Manion Published on November 29, 2018

The Holy See has enjoyed diplomatic status for centuries. The Vatican is recognized under international law as a sovereign territory by almost 200 countries. That includes the United States, which sent its first Ambassador to the Vatican in 1984.

At the time, President Reagan’s decision to establish formal diplomatic relations was unpopular with many prominent evangelicals. Rev. Jerry Falwell went to Senator Jesse Helms, R-N.C. He urged him to block the nomination of William Wilson as America’s first Ambassador to the Holy See. So Helms asked a simple question:

“Jerry, what would happen if Pope John Paul II walked into the door at your Thomas Road Baptist Church service next Sunday at ten a.m.?”

Rev. Falwell bit his lip. “They’d stand on their chairs and cheer,” he replied.

End of opposition.

A Fragile Diplomatic Immunity

Since 1984, the Vatican’s new status with the U.S. has allowed the Holy See to enjoy “sovereign immunity” under international law. That’s the main reason why sex abuse lawsuits have never been able to touch Vatican property. (Think of St. Peter’s Basilica and the vast Vatican museums.) You can’t sue a foreign government for actions taken over which it doesn’t exercise direct control. However, recent events threaten to weaken that protection. Maybe even dissolve it.

The Vatican isn’t considered legally responsible for the actions of local bishops. So far.

In recent years, thousands of abuse victims have sued Catholic dioceses throughout the U.S. Over a dozen of those dioceses have declared bankruptcy in the face of those claims. In the past, one international lawyer tells The Stream, each bishop has been considered “supreme within his diocese.” In effect, he is the CEO of a corporation — namely, the local church. True, bishops belong to a national body called the U.S. Conference of Catholic Bishops (USCCB). But its conference’s role is at most consultative and advisory. It’s not like a national corporation which controls its local subsidiaries — and is responsible for their debts. Likewise, the Vatican isn’t considered legally responsible for the actions of local bishops. So far.

A Vatican Power Grab Could Backfire

However, since 2002 the USCCB has started changing the rules. It has issued a series of intrusive and complex rules and procedures that most dioceses consider binding. These include severe restrictions and a cost of untold millions of dollars and man‑hours.

Of course, the USCCB as a body does not officially “control” the Catholic Church in the United States. Nonetheless, that misconception has been propounded and perpetuated by many individual prelates quite successfully in practice. The late Cardinal Joseph Bernardin of Chicago strengthened that view. So did then-Cardinal McCarrick and, today, Cardinal Blaise Cupich.

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This power-grab maneuvering has opened wide a door of opportunity to plaintiff lawyers. Especially those who represent victims of abuse and cover-ups by Catholic clerics and prelates.

Up till now, bankruptcy courts have limited the amounts collected by plaintiffs. If the Archdiocese of Chicago runs out of money to pay off victims, courts couldn’t force the New York Archdiocese or the USCCB to cough up the difference. And certainly not the Vatican.

Changing Times?

But that might change now. At the USCCB meeting in November, U.S. bishops tried to hammer out a policy for punishing bishops who cover up sex abuse. They also sought documents on what Pope Francis knew about child-molesting ex-Cardinal Theodore McCarrick. And the Vatican stepped in and shut them down. Plaintiff lawyers will say that this proves that the bishops aren’t really independent. That the Vatican controls them, and so ought to be liable for their actions — including the shuffling of child-abusing priests.

The pope overruled that bishops’ national body on a question of vital importance: the moral integrity of Holy Mother Church herself.

Enter the lawyers. In recent months, many American bishops have asked civil and criminal authorities to inspect their records regarding abuse cases. Clever plaintiff lawyers are undoubtedly wondering, why not join in? New lawsuits could demand that civil courts recognize that U.S. dioceses are nothing more than Vatican subsidiaries. That claim would “pierce the veil” of the Holy See’s diplomatic status. Its immunity from lawsuits would then evaporate.

Every jewel-encrusted candlestick and Renaissance painting at the Vatican could end up on the auction block.

Of course, lawyers for the bishops and the Holy See will be quick to differ. They’ll point out that within the framework of Catholic canon law, such claims lack merit. Sure, the Vatican gives orders to American bishops, both individually and as a group. He hires them and can fire them. But each bishop still governs his own diocesan domain.

Inviting a Nightmare

Let’s assume that the prelates are serious. You know, in caring more for their victims than for themselves. Then how could prelates publicly spurn those same victims? Especially when they demand justice, including just compensation? Say a local diocese goes bankrupt. How could the “People’s Pope” who so loves the victims turn his back on their pleas? Which is more important — the treasures of the Vatican or the victims of decades of clerical abuse?

Pope Francis and his allies have been implacable in defending themselves from the laity. But they will be blindsided by the potential legal consequences of their actions. A seasoned Federal Court attorney tells The Stream:

Anything that the Pope does to diminish the authority, or to interfere with the duty, of local ordinaries to address the problem of tortious misconduct by predatory personnel, including prelates themselves, increases the likelihood of attaching liability to the Papacy and increasing the probabilities of its assets eventually being sought to cover levied damages.

The attorney continues, posing a critical question:

Does the pope’s directive to the USCCB have the effect of diminishing the ordinaries’ authority or to interfere with their duties? … That would certainly be an interesting issue for the Church’s enemies to plead and on which to take discovery. The Pope seems to invite such an adventure / nightmare, doesn’t he?

Every jewel-encrusted candlestick and Renaissance painting at the Vatican? It could end up on the auction block. Someday, your grandchild might ask you, “Why does a Saudi prince own what used to be St. Peter’s Basilica?” You can tell him to thank Cardinal McCarrick and Pope Francis.

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