The lawsuit alleges that family members, including founder Robert H. Schuller, borrowed money from an endowment fund and continued to receive generous salaries and perks even as the church struggled financially.
The Rev. Robert H. Schuller at the pulpit last year. A lawsuit alleges that Schuller family members used “control and influence” to enter the church into agreements that benefited the family to the detriment of the creditors. (Allen J. Schaben, Los Angeles Times)
The creditors committee in the Crystal Cathedral bankruptcy case has filed suit against church insiders, alleging that family members borrowed money from an endowment fund and continued to receive generous salaries and perks even as the church struggled financially.
The lawsuit is the result of a conflict between the committee and church insiders, who include family members of founder Robert H. Schuller. According to a bankruptcy exit plan filed by the committee, insiders will be the last paid after the sale of the church campus.
Insiders such as Schuller; his wife, Arvella; and daughter Carol Schuller Milner and her husband, Timothy, want to be paid at the same time as other creditors. As a result, the committee vowed in August to sue.
The claim, filed late last week, alleges that the ministry borrowed about $10 million from an endowment fund from 2002 to 2009.
The lawsuit also alleges that family members used “control and influence” to enter the church into agreements that benefited the family to the detriment of the creditors. The suit is asking that family members, or insiders, receive payment after every other vendor is paid off when the bankruptcy is settled.
“We think that the allegations of the complaint will ultimately be proven to be untrue,” said Carl Grumer, the lawyer for Schuller, his wife, his daughter Milner and her husband. He said the suit will not affect the anticipated sale of the church.
The lawsuit outlines several agreements between the Schullers and the church. According to the documents, Robert H. Schuller signed a transition agreement in which he is entitled to a $300,000 annual discretionary fund, plus health insurance and travel staff for the rest of his life.
Source: The Los Angeles Times | Nicole Santa Cruz