When the landlord goes bust

Municipalities, receivers may step in

Earlier this year, the Bethany Group LLC, a California-based owner of apartment complexes, filed for Chapter 11 bankruptcy protection, sending tenants in 15,000 apartment units across 58 complexes into residential turmoil. But, the residents had already been in a kind of domestic purgatory as the ownership group weeks before had stopped paying its bills, including salaries to the employees who worked at the various apartment complexes.

As the Bethany Group teetered, lawns weren’t being mowed, trash was not picked up, and in some cases water bills weren’t being paid.