Detroit bankruptcy judge hears from objectors, calls court session 'democracy at its very finest'

Source: Detroit Free PressSept.迷你倉最平 19--After hearing from Detroit area residents objecting to the city filing bankruptcy, Judge Steven Rhodes said he will urge the governor and emergency manager to listen to a recording of the session to get a sense of what objectors had to say.About 50 people took advantage of a rare chance this morning to address the judge who is handling the case, arguing that the city is not eligible for Chapter 9 bankruptcy.The objectors argued that Detroit emergency manager Kevyn Orr is not authorized to place the city in bankruptcy, Detroit is not in dire financial condition and the city should not be allowed to cut pensions."I think the emergency manager should not have the right to use the city pension system to balance the city's debt," city retiree Michael Abbott told U.S. Bankruptcy Judge Steven Rhodes. "I appreciate you considering that."Hassan Aleem, one of the 110 individual objectors, said Orr should not be allowed to place the city in bankruptcy court because, he said, "only an elected official can file for bankruptcy.""Mr. Orr was never known as the sharpest knife in the drawer," Aleem said.That comment drew a sharp response from Rhodes, who said objectors need to respect the "serious" nature of the proceedings."I understand the depth of feelings that many, many people have about this," Rhodes said. "I truly do. At the same time, however, I have to ask you seriously to refrain from personal attacks on Mr. Orr or really anyone. This is not the time and place for that."Stripped of the legalese that typically dominates bankruptcy court, the hearing was marked by emotional pleas for Rhodes to remove Orr's authority and to protect retiree pensions. Rhodes urged Orr and Gov. Rick Snyder to personally listen to a recording of the session "to see what citizens of this city said here in court today.""This was truly an extraordinary session of the court," Rhodes said. "It was an example of democracy at its very finest. The arguments and statements that you all took the time to articulate in writing and in court today were moving, thoughtful, passionate, compelling and well articulated."Also Thursday, Rhodes ruled that partly denied and partly granted a motion from Detroit city union AFSCME to compel further testimony from Orr on discussions he had with Gov. Rick Snyder about the city's bankruptcy. AFSCME complained that Orr had dodged too many questions in a private deposition.Rhodes said Orr must answer questions on his talks with Snyder if they didn't relate to legal advice. If they did, Orr doesn't have to answer. Rhodes offered to be available by phone for attorneys if they have disputes during future depositions.Rhodes said he will consider the individuals' arguments as part of his ruling on whether the city is eligible for bankruptcy, which will occur sometime after an Oct. 23 eligibility trial.Treading carefully amid unusually emotional terrain for bankruptcy court, Bruce Bennett, Detroit's lead bankruptcy attorney, acknowledged the "human dimension" of the city's plight without conceding that the city is not eligible for bankruptcy."No one is ever going to convince anyone in this room and I'm never going to argue that a bankruptcy case is a good thing. It's not a good thing," Bennett said. "What it is, is sometimes better than all the other alternatives."Bennett said the city is doing its best to minimize the negative impact of the city's bankruptcy on people."No one thinks this is going to be easy," he said. "But we know we have standards to meet and we're going to try really hard to meet them."One objector, Paulette Brown, who worked for the city for 30 years before retiring from the water department last year, said she should not be punished because she "was a dedicated civil servant" who endured tough conditions and earned her benefits."Can you imagine how stressful it is to even hear that there is a propose迷你倉 plan to reduce our pension and medical benefits?" Brown said. "Michael Vick went to prison for cruelty to animals. Your honor, I ask, who's going to prison for the proposed cruelty to retirees?"But Michael Cunningham, in contrast to most residents who attended today's hearing, said he support's the city's decision to file for bankruptcy."This is the only option that we have," said Cunningham, who runs a nonprofit organization that provides Detroit residents help with housing issues. "This is the only way that we are going to force banks to take 10 cents on the dollar for their debts."Cunningham said the policies of major banks, combined with property tax laws, make it difficult for residents to stay in their homes and to buy and renovate homes."If you continue to milk the property tax owners, they will run away," Cunningham said.In a municipal bankruptcy, a city must prove it is eligible to file for bankruptcy protection by showing that it is insolvent, that it obtained the appropriate authority from the state to file and that it negotiated in good faith with its creditors before it filed for bankruptcy. A city can also argue that negotiations with creditors became "impracticable," or impossible.Until now, jousting over Detroit's ability to seek protection from its creditors and restructure $18 billion in debt has been done almost exclusively by high-paid attorneys representing the city, the State of Michigan and attorneys who represent unions, insurers and bondholders.But retirees such as Olivia Gillon were given the opportunity to speak her mind today, and she did.Gillon, who worked for the City of Detroit for nearly 34 years before retiring in 2002, said banks should not be given "preferential treatment" over retirees. She criticized Orr's plan to cut pensions and health care benefits."It seems like he's putting the onus for fixing the city's problems on the retirees," Gillon said. "And most of us were not even involved in the decisions that were made in the process that got the city into the trouble that it's in now."Joyce Davis asked Rhodes to disallow everything Orr has done."It is like someone robbing us without the use of a weapon. If you have God in you, stop this," Davis said.The concerns for individuals was fresh in Rhodes mind at a separate hearing at 3 p.m. today to consider a request by a retiree creditors committee to put a hold on all eligibility rulings, arguing it falls under the jurisdiction of the higher U.S. District Court, not bankruptcy court."This morning I heard retirees expressed profound uncertainly about the outcome of these proceedings and the impact on their pensions," Rhodes said in questioning the tactics of their representative committee with a request that would delay the eligibility hearings.Bruce Bennett of Jones Day, who represents the city, said the city needs to get a restructuring plan done fast, noting there are people deciding whether to do business with the city or invest here who are holding off until the eligibility decision is made."It's not a pleasant place to work right now," Bennett added.Committee lawyer Claude Montgomery, cautioned that Rhodes, in making his decisions, "has to be especially sensitive to what Orr is doing."Also Thursday, Rhodes ruled that partly denied and partly granted a motion from Detroit city union AFSCME to compel further testimony from Orr on discussions he had with Gov. Rick Snyder about the city's bankruptcy. AFSCME complained that Orr had dodged too many questions in a private deposition.Rhodes said Orr must answer questions on his talks with Snyder if they didn't relate to legal advice. If they did, Orr doesn't have to answer. Rhodes offered to be available by phone for attorneys if they have disputes during future depositions.Copyright: ___ (c)2013 the Detroit Free Press Visit the Detroit Free Press at .freep.com Distributed by MCT Information Services儲存