TORONTO, June 2 (AP)--Anglican worshippers used to giving donations on Sundaymorning got something back recently--a pastoral letter describing howthe General Synod, or national church, could face bankruptcy.

The letter from Archbishop Michael Peers, distributed May 28 in all 2,400Anglican congregations in Canada, explained that lawsuits filed by victims ofphysical and sexual abuse decades ago at church-run schools fornative peoples seek hundreds of millions of dollars in damages.

"About 100 cases involve the proven abuse of children, and theperpetrators are in prison," Peers wrote. "The costs of litigation andsettlements for these alone is sufficient to exhaust all the assets ofthe General Synod and of some dioceses involved."

It was shocking news for the more than 740,000 Anglicans, acknowledgedJim Boyles, general secretary of the Anglican Church of Canada. Fewrealized the General Synod's assets of $6.8 million--$2.7 million in property and $4.1 million in investments--could disappear.

"Although this issue has received attention in the media, the seriousness hadn't hit home," Boyles said from his Toronto office.

About 7,000 claims have been filed against the Canadian governmentinvolving residential schools, which native, or aboriginal, children were forced to attend. Dating back to the 19th century, the schools tried to assimilate aboriginals into the dominate white culture.

Canada has an estimated 800,000 aboriginals--including Indians, Inuit,and the Metis, a group of mixed French and Indian descent.

Students at the residential schools lost their native language andculture and often faced physical and sexual abuse.

Four churches that ran residential schools--Anglican, United Church of Canada,Presbyterian, and Roman Catholic-were named in some lawsuits. Thosechurches are now negotiating with the government on ways to settle thelawsuits or pay off any judgments.

While some dioceses of the Roman Catholic and Anglican churches could gobankrupt, the Anglican General Synod is the only national structurebelieved to be at risk. The Anglican Church operated 26 schools, closingthe last ones in 1969, and faces 1,600 claims.

Boyles said a previous case in British Columbia established that thegovernment and churches were "jointly and severally liable," meaningthat if the churches cannot pay an amount ordered by a court, thegovernment must.

The structure of the Anglican Church protects most congregations fromliability, Boyles said. Only the dioceses named in lawsuits and theGeneral Synod would have to pay, he said.

Peers' letter offered the same message to churchgoers worried that theirweekly donations would go to lawyers.

"I want to assure all Anglicans that what is at risk financially areour assets, not the contributions that provide for the ongoing ministryand mission of the church at parish, diocesan or national levels,"Peers wrote. "Your contributions serve the mission of the church--notthe costs of litigation."

His letter, and a column in the monthly Anglican Journal newspaper,acknowledged the church's role in running the abusive residentialschools.

"The facts are that the General Synod is guilty by participation andassociation with individuals who physically and sexually assaulted asubstantial number of students at residential schools," journal editorDavid Harris wrote in a May editorial that said the General Synod mayhave to file for bankruptcy protection.

Such admissions only hurt the church's chances of avoiding bankruptcy,said Ian Hunter, a law professor at the University of Western Ontario.

"The Anglican Church is unique in Canadian legal history in apparentlyconvicting itself from its own mouth and apologizing its way into alegally untenable position," Hunter wrote in the National Postnewspaper on May 29.

While the Anglicans lack cash, Boyles said, the church can offerresources and expertise for programs to help heal and reconcile withaboriginal communities.

"What we're saying to government is it makes sense to work out anagreement whereby we can contribute to the settlement...with thestrength and gifts that we have," he explained. "Our feeling isAnglicans would generously support increased work involving healing andreconciliation with aboriginal people, but are not likely to contributeto legal costs."

Peers' letter said the General Synod would be irrevocably changed, nomatter the solution. He previously has tried to inspire the faithful bynoting a parallel with Christ's resurrection.

"On Good Friday, Jesus stopped," he was quoted as saying by theAnglican News Service

. "His heart stopped beating. His blood stoppedflowing. But the story didn't stop. God's purposes will not be thwarted.

"And so, if bankruptcy becomes inevitable, we really are called to bethe body of Christ. Dead. Absolutely dead. And just as absolutelydestined to rise."