[RPPTL LandTen] Eviction vs. Bankruptcy question

[Chuck Hoskin]

If it is a Chapter 7 and the property is not claimed as exempt, then the "property" belongs to the Trustee.  If it is a Chapter 13, you need to review the plan to see how it is treated in the Plan.

Section 365 of the Bankruptcy Code relates to acceptance and rejection of executory contracts.  Check the debtors' schedules and see if they listed any executory contracts and what their intentions are regarding those contracts.  Chances are they did not list your lease.  You may need to file a Motion To Accept or Reject an Executory Contract along with a Motion For Relief From Stay.

In rem or not, your eviction is on hold until you first get permission from the bankruptcy court.  The stay is also a stay against property of the debtors and arguably they have a leasehold interest in the property.  If the attorney for the debtors asks to stay the eviction, as for back rent as a condition of the stay.  If the tenant is going to "accept" the executory contract, they have to cure defaults and provide "adequate assurances" that defaults will be promptly cured and of future performance.  Usually that means rent and attorneys' fees.

Probably much more than you wanted to know.  Good luck!

Chuck Hoskin

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From: landten-bounces at lists.flabarrpptl.org [mailto:landten-bounces at lists.flabarrpptl.org] On Behalf Of Cary Sabol
Sent: Tuesday, November 29, 2011 11:47 AM
To: RPPTL Landlord Tenant Committee
Subject: [RPPTL LandTen] Evicton vs. Bankrupty question

Fellow Group Members,

I have a situation where I recently filed an eviction against a residential tenant who is currently in bankruptcy proceedings.  In fact, the tenant just filed a few weeks ago, but I think it's important to note that the bankruptcy was filed before the eviction was filed.  The attorney representing the tenant in bankruptcy says they are going to ask for a stay on Eviction case.  No lease by the way.  Not suing for back rent, just possession.

My understanding is that the landlord can proceed with the eviction, in rem only, as long as we are not seeking monetary damages, but I know very little about bankruptcy.  Has anyone else ever faced this situation?  Or does anyone know enough about bankruptcy to say whether the eviction would be stayed?  Any suggestions are appreciated.
Cary
Law Offices of Cary P. Sabol
P.O. Box 15981 | West Palm Beach | Florida | 33416
Phone: (561) 281-2744
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