Use of hospital funds argued

Wendi Horwitz, state deputy attorney general, had not returned a phone call by press time asking for confirmation of the restoration of funds to Paradise Valley and that her office had been contacted by Morrison’s intermediary.

Long-standing agreement upheld

Gonzalez said Adventist was acting in accord with a long-standing agreement regarding the distribution of assets.

“In preparation for transfer of ownership, the foundation has merged into South Coast Medical Center and its assets formally transferred into the hospital in accordance with the original understanding between the parties and the formal governing documents,” Gonzales said.

According to the document presented to the foundation board last Friday, the foundation is solely responsible for any losses sustained by Adventist that meet or exceed $3 million and further that the assets of the foundation can legally be distributed to the medical center upon dissolution of the foundation.

The document also states that contributions to a not-for-profit organization are donated for a specific project, the contribution is considered only temporarily restricted and that portion of the organization’s assets are restricted until the donor’s purpose has been met.

Cancer center not built

Funds for the down payment on the building were specified for the establishment of a cancer center, which has not taken place, which leads Morrison to believe that the building has been hijacked by Adventist.

“At a meeting on Oct. 16, Adventist Health indicated that it wanted us to sign over Medical Center West, but we refused,” Morrison said.

Gonzalez said Adventist has acted appropriately and legally in the matter.

“The decision was made to sell the hospital, and a qualified not-for-profit bidder was selected,” Gonzalez said. “Now the process is moving forward, as it should.

“We thank the foundation board members for their hard work and dedication and continue to share their desire to see South Coast Medical Center remain an acute-care hospital for the community.”

BARBARA DIAMOND can be reached at (949) 494-4321 or coastlinepilot@latimes.com.