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Diocese of Norwich files Chapter 11 plan and disclosure statement
By Sarah Lizee
Olympia, Wash., Aug. 1 – Norwich Roman Catholic Diocesan Corp., known as the Roman Catholic Diocese of Norwich, filed a Chapter 11 plan and disclosure statement with the U.S. Bankruptcy Court for the District of Connecticut.
The plan is being proposed by the diocese and the official committee of unsecured creditors.
The plan requires the diocese, Catholic Mutual and the participating parties – including the parishes, Mount St. John, Oceania, Xavier, Mercy and St. Bernard – to make fair and reasonable settlement payments, and substantial and meaningful contributions to fund distributions to abuse claimants.
The diocese and the committee estimate that the funding provided for in the plan will ultimately exceed $32 million.
The diocese will be discharged of all claims. The participating parties will be granted releases and the benefit of injunctions related to abuse claims in exchange for their contributions and settlement payments.
Other priority claims are unimpaired under the plan and will receive 100% recovery.
The Citizens secured guaranty claim is impaired, and upon the closing of the Middletown property sale, Citizens will fully, finally and completely release the diocese.
The M&T secured revolving loan claim and M&T secured guaranty claim are impaired, and the claims will be retained.
General unsecured claims are unimpaired and will receive 100% recovery.
Abuse-related contribution claims will receive no recovery.
The claims held by the Catholic entities are impaired under the plan, and the Xavier and Oceania have, as part of their settlement with the diocese, waived the right to receive any distribution under the plan.
The Norwich, Conn.-based diocese filed bankruptcy on July 15, 2021 under Chapter 11 case number 21-20687.
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