DETROIT – Last Friday, on the day after Thanksgiving, tenants living at the Leland House apartments in Detroit received a shocking letter informing them they would have to move out of the building because ownership was unable to pay a massive DTE Energy bill.
However, on Thursday (Dec. 4) afternoon in U.S. Bankruptcy Court, a last-ditch effort to secure funding bought residents just enough time, and a judge ruled that the power can stay on, for now.
“We did pull off a miracle today,” Nathan Resnick, attorney for the Leland’s owner, The Michael Higgins Trust, said. “We found a lender, and that lender has agreed to provide the financing that’s necessary both to pay DTE the money that they’re requiring, as well as doing repairs in the building that the city has required, so and the judge approved that today.”
The, at times, contentious, nearly three-hour-long hearing saw a fleet of attorneys on both sides, including creditors and attorneys with the city of Detroit, argue that the trust should be given more time to pay the debt to DTE to keep the power on in the nearly 100-year-old building at least through the weekend.
Judge Maria Oxholm, at times annoyed by the haste with which the hearing was called, gave the building’s owners until next Monday at 5 p.m. to pay the more than $57,000 deposit owed to the utility, or a default judgment will be entered.
The building’s owner filed for Chapter 11 bankruptcy in early November and is preparing the building for a potential sale.
Luis Ramirez, the authorized representative for the trust, said the near-closure stemmed from the unpaid deposit to DTE.
Resnick said that Ramirez had initially gotten a creditor before the “rug was pulled out from underneath him” at the last moment, forcing him to send the closure letters.
Initially, if the payment wasn’t made by Wednesday, DTE had planned to cut the power to the building, rendering it unlivable.
They were given a one-day extension to account for the court hearing.
At one point during the hearing, Oxholm stated that, as long as residents were in the building, DTE should not cut the power.
Sensing DTE’s attorneys were willing to ignore her recommendation, she ordered the utility to keep the power on through the weekend.
“I think the judge was very understanding and sympathetic for the residents and understanding the harsh consequences of them having to move,” Resnick said. “The judge made it very clear that she was not going to let DTE shut the power off today or in any time in the near future.”
More than a dozen residents were in the courtroom, expressing various levels of anger and confusion over the entire ordeal.
But there was a small sense of relief following the judge’s ruling.
“Today was a good day,” William Clark, who has lived at the Leland for 10 years, said. “We got more time to find a place in the future to stay, but right now, we’re good, and it was a good day.”
Clark was frustrated by the entire ordeal, laying the blame for the debt at the feet of previous landlords and what he called DTE Energy’s greed.
“DTE does not have a heart,” Clark said. “All they care about is money, and it’s not right.”He’s happy for the reprieve, but this entire ordeal has taken a toll on him.
“It’s been hard, stressing out, not being able to work and make money to pay my bills,” Clark said, fighting through tears. “But I’m getting through it, and today made me feel a lot better.”
Assuming there is no default in payments, a final hearing is scheduled for 11 a.m. on Jan. 12 before the U.S. Bankruptcy Court.