Renters can suffer when owners are in bankruptcy

Saturday, August 1, 2009
Greg Mellen Staff Writer
Press-Telegram

LONG BEACH -- At 3 p.m., after spending two hours in the sun, after the one-sided phone calls, unreturned voice messages and being hung up on, the shell of Marine Corps toughness cracked and tears welled in the eyes of LaTonya Jennings.

Despite being current with her rent, she had just been forced out of the apartment where she's lived since April.

She didn't know where she'd sleep. She didn't know who would care for her pet lizard, which she had in a large terrarium. She had no money and her compact car was loaded with the belongings she could gather before U.S. marshals took the keys to the apartment she rented.

Her roommate, Joe Mulhern, had a more harrowing experience. The 68-year-old said he was ordered out of the apartment at gunpoint earlier in the day. He had taken what clothes and personal items he could fit in his car and was looking for a hotel room for himself for the night.

Mulhern said the marshals who forced him from the apartment refused to identify themselves or provide a court order or any documentation authorizing their action.

Jennings and Mulhern said a notice giving them 10 days to vacate had been posted on the door July 17.

However, they claim property manager Betsey Lebbos, the former owner who is ensnared in a bankruptcy dispute that involves the property on East First Street in the Alamitos Beach neighborhood, said the order was fraudulent and invalid because, among other things, it was not signed by a judge.

Lebbos says the action of the marshals was illegal and the order fraudulently obtained in what she claims is an ongoing scam being perpetrated against her.

"I never in my wildest dreams thought they could do this," says Lebbos, adding she is working feverishly to get the action reversed. "This is totally illegal."

Officials from the U.S. Marshals Office in Los Angeles said their only role in evictions is to provide aid and ensure safety under the direction of the bankruptcy court. They declined to discuss the specific case, referring inquiries to the bankruptcy court.

`What am I going to do?'

While the future of the property and bankruptcy issues remain to be worked out in the courts, it was of little solace for Jennings as she watched workers remove furniture from the apartment into a moving van and cart it away. She later learned she could not reclaim her belongings until lawyers released the property. And as of Friday, Jennings didn't know what it would take to get her furniture back.

As she stood on the sidewalk outside her former apartment, the exasperated ex-Marine could only mutter expletives to no one in particular.

"What am I going to do?" she asked.

At the time, the 29-year-old, who rushed home from her part-time job at Vons when she heard she was being ousted, had no answers.

Jennings and Mulhern joined a growing segment of renters in Long Beach and nationwide, who are being forced out of housing because of evictions and property disputes to which they are not parties.

And many, like Jennings, pay their bills and still find themselves out of their homes, out of their rent and deposit and out of luck.

Although President Barack Obama recently signed legislation giving renters a 90-day window to move before they can be evicted from a foreclosed property, Jennings and Mulhern knew of no avenue to challenge their ouster as the law apparently doesn't apply to property seized through a bankruptcy court.

At the Legal Aid Foundation, staff attorney Tamara Webster said she had never heard of tenants being ousted by bankruptcy courts, although renters being evicted by foreclosures "over the last eight months has really picked up."

Some estimates show up to 20 percent of foreclosures are on homes with renters. And according to stats reported by CNN from a company called RealtyTrac, which tracks foreclosures nationally, 38 percent of homes being foreclosed on are not owner-occupied, meaning they are either second or vacation homes, income properties or rentals.

For renters on shaky financial footing like Jennings and Mulhern, losing housing can be devastating.

The two are both victims of the economy. Jennings said she makes $20 or more per hour doing executive administration work on a contract basis, until, as she puts it, "the recession happened" to her job.

She was unemployed for a year before landing the job at Vons.

Mulhern remains unemployed and says at his age, work is hard to come by.

Jennings said she knew she should have been wary when she signed her lease.

"I knew it," Jennings says as she puffs on a Marlboro cigarette, rolling her eyes and shaking her head in disbelief. "All kinds of things didn't add up."

Lebbos said both Jennings and Mulhern were given fair warning and signed leases that said the "property is in litigation and reasonable notice to vacate may be required."

In the meantime, Jennings and Mulhern say they got lucky and have found a new apartment to share, although at a much higher rent.

Both are exploring what legal remedies they have to recover their deposits, prorated rent and property.

As Jennings says, "All I wanted was to get a room and get back on my feet."

greg.mellen@presstelegram.com, 562-499-1291

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