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Under the diocese’s plan, the ministry will be able to lease the core buildings including the cathedral and the Tower of Hope for three years. After three years, Crystal Cathedral Ministries and the school will move to the 10-acre property on Lewis Street where St. Callistus is now located.
The Crystal Cathedral, built by television evangelist Robert Schuller, filed for Chapter 11 bankruptcy last year, citing more than $50 million in debt. Often used by businesses, a Chapter 11 bankruptcy involves a bankruptcy reorganization plan that accommodates debt reorganization through a payment plan. Under this chapter, debtors prepare a disclosure statement which describes their proposed reorganization proposal and payment plan. The proposed plan is voted on by the various classes of creditors and then submitted to the Court for final approval.
A major advantage of a Chapter 11 filing is that the debtor generally remains in possession of their property and operates their business subject to court supervision. This allows for the debtor to act as a trustee with respect to the property during the bankruptcy. Chapter 11 debtors also often keep a substantial portion of their assets because the provisions of Chapter 11 allow the debtor relief from pending obligations and the opportunity to reorganize its business and restructure debts while continuing to operate the business. Additionally, unlike Chapter 13 filing, there is also no limit to the amount of debt a debtor may have when filing for protection under Chapter 11.
While an individual debtor may qualify for Chapter 11 protection, for individual debtors one disadvantage is that there is no discharge unless the debtor makes all of the plan payments. Unsecured creditors can also object to the proposed plan and force payment in full or the receipt of all disposable income for the duration of the plan. Additionally, unlike a Chapter 12 plan which must be completed within five years, there is no time limit for a Chapter 11 bankruptcy plan to be completed.
Whether you own a business, individual or partnership and you are facing a financial crisis, there may be help for you to discharge all or a portion of your debts or to use bankruptcy to restructure your debt payments. Chapter 7 and Chapter 13 bankruptcies are the most common types of bankruptcies available for individuals, but Crystal Cathedral has chosen to file Chapter 11 bankruptcy which is common for many businesses.
Bankruptcy is an important financial decision, and should not be made without first contacting a lawyer. If you are considering filing for bankruptcy, contact the Orange County law firm of Don Ho LLP for information.
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