Grier v. United States Department of Housing & Urban Development, 418 U.S. App. D.C. 185 (2015)

Citation: Grier v. United States Department of Housing & Urban Development, 418 U.S. App. D.C. 185 (2015)
Parent Document: Grier v. United States Department of Housing & Urban Development, 418 U.S. App. D.C. 185 (2015)
Jurisdiction: United States (federal)
Effective Date: 2015-07-14
Original Source: https://www.courtlistener.com/opinion/2816866/grier-v-united-states-departmen... ↗

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Mantua Gardens and Grier argue that the Secretary’s
finding of liability for violations of the Section 236 program was
arbitrary and capricious and not supported by substantial
evidence. They claim that no violations by them can be found
after February 25, 2008, because that was the date on which the
mortgage on Mantua Gardens was purchased from Firstrust by
Mantua Gardens East, LLC. Mantua Gardens East is not an
FHA-approved mortgagee. By transferring the mortgage to
Mantua Gardens East, LLC, Mantua Gardens and Grier argue,
the mortgage ceased to be insured, co-insured, or held pursuant
to the Regulatory Agreement, and therefore liability for
violations of the Agreement could no longer attach. Mantua
Gardens and Grier further contend that no violations of the
Regulatory Agreement by them can be found prior to February
25, 2008, because the transfer of the reserve funds from Firstrust
to Wachovia was tacitly approved by Firstrust, and Firstrust had
full knowledge that Mantua Gardens intended to use some of
that money as collateral for a loan. Noting that Firstrust is an
FHA-approved mortgagee subject to HUD oversight and
responsible for ensuring compliance with FHA requirements,
Mantua Gardens and Grier argue that if anybody is at fault it is
Firstrust.

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