A legal battle brews between the Monterey diocese and the Mission Foundation.

The Bible, in the Book of Matthew, quotes Jesus as saying no one can serve both God and money. In the end, you will be devoted to one and despise the other, he said. Leaders of the Diocese of Monterey are apparently choosing money in a lawsuit they filed against the Carmel Mission Foundation, an independent, secular nonprofit the diocese helped create and partnered with for a decade to benefit restoration of the historic mission.

The diocese’s lawsuit, filed May 8 in Monterey County Superior Court, accuses the foundation of breach of fiduciary duty, fraud, breach of contract and other alleged offenses in the handling of money related to the renovation of the Downie Museum, completed in 2021. (The museum has never reopened.) The suit alleges that an estimated $6.3 million in funds raised for renovations was “lost, misused and consumed through excessive administrative costs, mismanagement and/or self-dealing,” according to court documents.

The foundation clapped back in a response filed July 10, denying all accusations and charging that the diocese knows its claim of a misuse of funds is untrue. The intent of the diocese is to shut down the foundation and use donor money for its own purposes, the foundation argues.

Foundation attorney Forrest Shryock says their evidence shows there was no impropriety. “There can be disputes about how projects should be run, but it’s one thing to have a difference of opinion and quite another to accuse someone of fraud because you disagree with how they’re running the project,” he says.

The suit was filed not long after the foundation’s board voted to transfer its money to a fund at the Community Foundation for Monterey County. “We made this decision because we believed that we had a fiduciary responsibility to our donors to make sure their donations were used for the intended purpose of restoring and preserving the Carmel Mission property,” said Richard Denier, foundation board chair, in court documents. (An attorney for the diocese did not respond.)

The diocese sought a temporary restraining order which was granted, blocking a transfer of funds. But in a hearing on July 21, Judge Vanessa Vallarta made no ruling on a permanent injunction and expressed doubts that the diocese had proved its case, Shryock says. She told the two sides to work out a resolution. The next hearing is scheduled for Nov. 17.