Supreme Court Asked to Review Puerto Rico Court Actions in Church Plan Case

A judge ordered the Archdiocese of San Juan to pay $4.7 million to teachers whose pension plan had been terminated, and the Archdiocese claims that since then, the Puerto Rico government has seized assets from entities not related to the plan.

The Roman Catholic Archdiocese of San Juan, Puerto Rico, has filed a petition for writ of certiorari with the U.S. Supreme Court over actions taken by the Supreme Court of Puerto Rico in a case regarding a terminated pension plan.

Following a decline in enrollment in Catholic schools as residents left the territory due to a 12-year recession, and the exacerbation of the problem due to Hurricane Maria, in 2016, the archdiocese notified several hundred teachers that their pension payments were being stopped because payouts exceeded contributions. The teachers filed a lawsuit, and in 2018, a judge ordered the archdiocese to pay $4.7 million to both retired and active teachers.

Among other things, the teachers’ alleged in their original complaint that the multiemployer plan set up by the church for Catholic school employees elected to be an Employee Retirement Income Security Act (ERISA) plan, but plan fiduciaries, including service providers, failed to comply with ERISA.

According to the petition to the U.S. Supreme Court, following the court decision, the Puerto Rico Supreme Court proceeded to declare every single Catholic entity in Puerto Rico—including the Roman Catholic Archdiocese of San Juan, five separate Roman Catholic dioceses, all 338 parishes, and all other Catholic entities on the island—part of one monolithic (and, in both Church doctrine and secular reality, nonexistent) entity dubbed the “Roman Catholic and Apostolic Church in Puerto Rico.” Most of these entities did not participate in the Church Pension Plan.

The Archdiocese of San Juan said the Puerto Rico Supreme Court decision represents an unprecedented intrusion on the First Amendment rights of religious organizations. “It has been settled law for 150 years that civil courts lack the power to intrude on matters of church structure and governance, as to do anything but defer to a church’s own views on such matters would raise grave concerns under both the Free Exercise Clause and the Establishment Clause. The Puerto Rico Supreme Court not only ignored those principles, but got them exactly backwards, viewing itself as not just empowered, but obligated, to ignore the Catholic Church’s own canon law establishing the many constituent parts of the Church as distinct legal entities,” the petition says.

The Archdiocese alleges that based on a refusal to defer to the separate nature of the various Catholic entities on the island, a sheriff was ordered to “open doors, break locks, or force entry … night or day” into Catholic churches throughout Puerto Rico and seize and sell off artwork, furniture, and anything else of value unless and until the nonexistent “Roman Catholic and Apostolic Church in Puerto Rico” supplied $4.7 million to fund the pension obligations of three Catholic schools whose pension plan has run out of money. “The resulting seizure of critical assets of churches and other Catholic entities throughout the island has forced the Archdiocese into bankruptcy and dramatically interfered with the ability of Catholic entities to minister to the faithful, provide for their employees, and provide social services desperately needed by the people of Puerto Rico,” the petition says.

The petition is asking the U.S. Supreme Court to answer the question: “Whether the First Amendment empowers courts to override the chosen legal structure of a religious organization and declare all of its constituent parts a single legal entity subject to joint and several liability.”