HUD Tries To Block Sears Methodist's Cash Use For Ch. 11
By Kurt Orzeck
Law360, Los Angeles (July 10, 2014, 6:44 PM EDT) -- The U.S. Department of Housing and Urban Development on Thursday urged a Texas bankruptcy court to reject Sears Methodist Retirement System Inc.'s attempt to use cash collateral to pay the costs of its Chapter 11 proceedings, saying such expenditures could jeopardize the safety of senior housing community tenants.
In an objection to housing community operators' request for the use of cash collateral, HUD argued that project funds going toward paying expenses that don't benefit the communities would be contrary to regulatory agreements.