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Lender: Tampa's Without Walls seeks bankruptcy to dodge foreclosure

TAMPA — Citing millions in liabilities, Without Walls International Church is seeking bankruptcy protection — a move a major lender asserts in court papers is an attempt to dodge a foreclosure judgment.

The California-based Evangelical Christian Credit Union says the Tampa megachurch owes it $29 million. It calls Without Walls' filing for Chapter 11 bankruptcy protection on March 5 a "litigation tactic" to prevent foreclosure on the W Columbus Drive church and also a shuttered church in Polk County.

Without Walls defaulted on its loans before the bankruptcy filing and the credit union began foreclosure proceedings in October 2012, according to the motion filed Monday in U.S. Bankruptcy Court.

The bankruptcy court has denied the credit union's request to move forward on the foreclosure case, said Michael J. Hooi, an attorney representing the church. Without Walls said in court documents filed Tuesday that the credit union's request was baseless.

Another hearing on the issue is scheduled for April, when the court may schedule a trial if the matter isn't resolved, Hooi said.

Without Walls filed a counterclaim to the foreclosure action in October 2012, alleging that the credit union schemed to prevent the sale of the church by encouraging pastor Randy White's former wife — Paula White — to take sound equipment from Without Walls to another church.

Paula White currently is senior pastor of New Destiny Christian Center in Apopka, near Orlando.

In this week's filing, the credit union said the church's counterclaim was "spurious at best."

The credit union also alleges in court documents that the church pulled out of a deal last year that would have sold its property in Tampa to the Richman Group of Florida for $12.6 million, but that the church "refused to close on that sale at the last second."

The church lists an estimated $10 million to $50 million in both assets and liabilities, according to its petition. A Chapter 11 filing typically lets businesses continue to operate and come up with a plan for paying creditors.

The 12,000-member church was established in 1991. About 4,000 members attend one or more of its three weekly services at the Tampa site, according to the church. White, who resigned as senior pastor in 2009 because of what he called health concerns, returned to Without Walls in July 2012.

Without Walls once boasted 22,000 members and was among the fastest-growing congregations in the country. But half its members left after the Whites' 2007 divorce, and the church also has endured tough media scrutiny, an inquiry into its finances led by U.S. Sen. Charles Grassley, R-Iowa, and the ongoing foreclosure issue.

Lender: Tampa's Without Walls seeks bankruptcy to dodge foreclosure 03/13/14 [Last modified: Thursday, March 13, 2014 11:27pm]
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