Spokane, Wash., Aug 30, 2005 / 12:00 am (CNA).- Bishop William Skylstad of Spokane, Washington has announced that his diocese will appeal a federal court ruling which, on Friday, declared all parishes in the diocese assets which can be liquidated to pay for claims by alleged victims of sexual abuse by priests. Bishop Skylstad, who also holds the post of president of the U.S. Conference of Catholic Bishops, said in a statement released from Eastern Europe, where he is currently traveling, that

"The court's decision has national consequences.”

“Its impact”, he said, “will be felt not just by Catholic communities but by many other church communities of any denomination, of any faith expression."

In December of last year, the diocese filed for Chapter 11 Bankruptcy protection citing $11.1 million in assets and $83.1 million in liabilities from abuse victims seeking compensation.

Diocesan parishes and schools were not included in that figure as, according to Canon Law, the bishop is only steward of them--the parishes themselves control their own actual assets.

U.S. Bankruptcy Judge Patricia Williams’ Friday decision however, ignores this fact, opining that civil property laws supersede Church law.

In her decision, Williams wrote, "It is not a violation of the First Amendment to apply federal bankruptcy law to identify and define property of the bankruptcy estate even though the Chapter 11 debtor is a religious organization."

Lawyers for, and supporters of the diocese however, disagree.

Bishop Skylstad wrote that he would "appeal this decision because we have a responsibility not only to victims but to the generations of parishioners ... who have given so generously of themselves" to build up the church in eastern Washington.

William Donahue, president of the Catholic League, called the ruling “outrageous,” saying that “At a minimum, separation of church and state means that sitting judges have no right to make determinations regarding the organizational chart of the Catholic Church. But that is exactly what’s being done.”

“By declaring all diocesan assets fair game for every steeple-chasing lawyer,” he continued, “a green light has been given to plunder the resources of the Catholic Church.”

12:56 pm | Venezuelan cardinal calls for new evangelization of country's capital

11:11 am | International congress to focus on priestly identity and celibacy

07:10 am | Former Saints star says Super Bowl victory revealed a ‘team with destiny’

06:01 am | DC ruling favors same-sex ‘marriage’ over religious freedom, archdiocese says

04:43 am | South African Bishops Conference to care for 60,000 AIDS patients

Catholic League president: Church must start playing hardball against victimization

Judge rules diocese can be liquidated in sex-abuse case: questions arise about “big business”

Bishop caught up in sex scandal apologizes to Argentine episcopate

Argentine bishops call for forgiveness and conversion in wake of sexual scandal involving bishop.