The District Court of Guam has denied the Archdiocese of Guam’s application to hire a financial advisor to oversee its bankruptcy case.
The Unsecured Creditors Committee and the Archdiocese of Guam will have to work together as District Court Chief Judge Frances Tydingco-Gatewood-Gatewood denied the petition to hire Ankura Consulting Group LLC as the committee’s financial advisor.
The Chief Judge stated that the $75,000 proposed cost per month to hire the consultant group even over the next four months would run the Catholic Church into “insolvency.”
She reminded the parties that the Archdiocese is not Lehman Brothers, referring to the giant U.S. investment bank that declared bankruptcy in 2008.
The committee as a whole unanimously voted to retain Ankura with the understanding that such employment will further drain money from the pot.
The court, in response, stated it “does not find this convincing, adding that not all the creditors are willing to take that risk.”
In denying the petition, Chief Judge Tydingco-Gatewood pointed out that if the Catholic Church was to become insolvent, the negative effects will not only impact the debtor, and creditors but the entire Catholic community.
She believes that the parties should work together and ordered that the Archdiocese and the Committee confer for the next two weeks on unresolved issues that led to the application.
The Catholic Church must also provide documents requested by the committee and make its employees available.
A joint status report is due on May 11th.