The owner of a Mesquite condominium sued by the city for widespread, chronic code violations filed for bankruptcy last week, according to Dallas County court records. The Chapter 11 bankruptcy filing came on July 29, just days after the landlord’s attorneys asked a judge to appoint a third party to oversee what they call a “highly politicized” case.
On Tuesday, court records showed the city’s case against the landlord was dormant; A court coordinator confirmed Thursday that the bankruptcy case is staying all other proceedings until it is resolved.
A Hillcrest attorney said in a statement Monday that the owner felt they had “no choice” but to file for bankruptcy.
“Faced with difficulties in obtaining a fair home improvement and repair contract, and further issues related to financing to facilitate property improvements, the LLC had no choice but to protect and preserve its assets by filing for Chapter Bankruptcy Protection 11 requested to find a way forward includes continuing to address residents’ concerns,” the owner’s attorney, Joyce W. Lindauer, said in a statement.
It’s unclear how exactly Hillcrest’s bankruptcy filing will affect the city’s case against the landlord, but Mesquite City Manager Cliff Keheley said in a statement that the city’s Code Enforcement Office will continue its work.
“Filing for bankruptcy does not affect the city’s commitment to ensure repairs and maintenance continue at Hillcrest Apartments,” Keheley said in a statement. “We will continue to hold the owner accountable for the continued neglect of this property.”
Residents of Hillcrest’s tenants’ union, who petitioned the court in June to join the city’s lawsuit, fear it will mean further delays in repairs and little resolution.
“To be completely honest, I have a feeling that probably nothing has changed,” said Brittany Jones, who has lived at Hillcrest Apartments for four years. “Hillcrest found another loophole and strategy to extend things that were in their favor.”
Tenants’ lawyers are yet to confirm details of how this will affect residents.
“Legal Aid is working to understand the impact the bankruptcy filing will have both on the state court process and on the people who are not part of this case – the ordinary people who deal with the horrific conditions in these homes.” , said Julius Jenkins, an attorney with Legal Aid of Northwest Texas who represents clients at the Hillcrest Tenants’ Union. “And we will do our best to minimize the impact of the bankruptcy filings on these people.”
The 1970’s complex was sold by Summit Hillcrest Apt. ltd in Montgomery, Alabama in 2020 to CC Hillcrest LLC managed by private equity firm Code Capital Partners of Windermere, Florida. Jared Remington is named manager of the company in the city’s lawsuit.
The city of Mesquite sued the Hillcrest Apartments owners in February after an outcry from tenants who said the landlord had failed to fix chronic, widespread outages of air conditioning, heating, hot water and sewage systems. A judge in March ordered Hillcrest to pay hotels for renters who report violations of the code.
But residents say this is not a solution as they continue to live in limbo while the case is in the hands of the court. It is unclear whether the trial scheduled for January will be delayed.
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