Church, sisters settle lawsuit

Archdiocese agrees to turn over funds from pension plan

By Lisa Wangsness
Globe Staff / May 26, 2011

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The Catholic Archdiocese of Boston and the Daughters of St. Paul issued a joint statement yesterday announcing they had settled the nuns’ lawsuit against Cardinal Sean P. O’Malley and other trustees of a lay pension plan.

The Daughters, an international order of nuns whose provincial headquarters is in Jamaica Plain, sued late last year to force the archdiocese to hand over the investments the Daughters had made in the archdiocese’s pension plan on behalf of the order’s lay employees.

The parties did not disclose the amount of the settlement yesterday, but said the agreement “included a transfer of the Archdiocese Pension Plan assets allocable to the Daughters of St. Paul to a new pension plan administered by the Daughters’’ and that it would “allow the Daughters to independently provide retirement benefits to their current and former employees.’’

The Daughters asserted they have been trying to extricate their lay employees’ assets from the church-run fund for years so they could establish and oversee a single pension plan for all their US employees. They had maintained they were owed nearly $1.4 million, based on their estimates of the value of their assets in 2007. In the lawsuit, they also said the archdiocese failed to maintain proper records of their assets.

The archdiocese denied that allegation and said both parties shared responsibility for delays. Church officials also said they had been moving toward completing the fund transfer when the order filed its lawsuit.

The Daughters began contributing in 1989 to the Pension Plan and Trust of the Roman Catholic Archdiocese of Boston, which includes retirement funds for employees of the archdiocese, as well as other Catholic entities.

The nuns had asked the Supreme Judicial Court to order the pension trustees to provide them with a full accounting of the nuns’ portion of the fund or to rule that the nuns were technically never part of the church-run plan and to order the archdiocese to reimburse the nuns’ contributions, plus returns.

The lawsuit was among a series of difficulties the archdiocese has had with its pension plans. Its fund for lay workers is underfunded, and the church is in the process of moving from a traditional defined-benefit pension plan to a 401(k)-style defined contribution plan.

The Daughters, with about 135 US members and about 2,500 worldwide, run a multimedia publishing house, Pauline Books and Media, which publishes Catholic books, music, and educational materials.

“The archdiocese looks forward to continuing the tradition of having priests of the Archdiocese of Boston celebrate daily Mass for the Daughters . . . as we work together to deepen and strengthen our common Faith,’’ the statement said.

Lisa Wangsness can be reached at