Are you behind on your rent? Are you a tenant and facing eviction? Have you been served with a Notice To Quit? If you answered yes to any of these questions, then exploring bankruptcy options may be right for you.
If the tenant doesn’t voluntarily move out after the landlord has properly given the required notice to the tenant, the landlord can evict the tenant. In order to evict the tenant, the landlord must file an unlawful detainer (UD) lawsuit in superior court.
A landlord may not prosecute a unlawful detainer (UD) action against a tenant who has filed a bankruptcy petition unless the landlord petitions the bankruptcy court for relief from the automatic stay and the court grants that relief. [See 11 USC §362(a), (d).] On the other hand, a tenant may not wait to file a bankruptcy petition until the landlord has obtained a judgment and writ of possession on the UD action. [See CCP§715.050; Lee v Baca(1999) 73 CA4th 1116, 1119–1122.] Although the automatic stay provisions prevent the landlord from enforcing money damages, they do not prohibit the landlord from regaining possession of residential premises from a bankruptcy debtor-tenant who is wrongfully holding-over.
The practical effect of bankruptcy is as follows:
- If you file your bankruptcy petition BEFORE being served with the notice to quit or before the UD action was filed, then the landlord will dismiss the case and must serve new notice after receiving leave from the the bankruptcy court.
- If you file your bankruptcy petition AFTER the UD complaint is filed, but before judgment, the landlord must obtain relief from the stay to go forward with the litigation regarding possession (without the award of a money judgment). Common practice is to continue the case for 30 days so the landlord may obtain relief from the stay.
- If a judgment of possession is obtained by the landlord BEFORE you file your bankruptcy petition, there is no automatic stay [see 11 USC §362(b)(22)] and the eviction may proceed.
Call the attorneys at Avant Law Corporation to discuss your particular unlawful detainer situation BEFORE it’s too late. The consultation is free and the peace of mind of understanding your legal options is worth the time.