Bankruptcy a Tenant Tactic
tenants think that filing a bankruptcy petition will prevent them from
being evicted. This is not always true. It will however through a road
block into your attempt to resolve a problem with a tenant, be it
failure to pay rent, a nuisance, or any other viable reason to pursue an
one of those occasions* where the Landlord should immediately seek legal
representation. The landlord that attempts to go it alone in bankruptcy
court will be disappointed and will in the long run lose more than
Bankruptcy is a complicated legal specialty and explaining it is beyond
the scope of this Article, however, here are some the basic issues you
will face as it relates to unlawful detainer proceedings:
You may, however, petition the bankruptcy court for
permission to proceed with the unlawful detainer action (called “relief
from the automatic stay”)
The automatic stay may continue in effect until the
bankruptcy case is closed, dismissed, or completed. On the other hand,
the bankruptcy court may lift the stay if you can show that you are
entitled to relief.
The automatic stay normally does not prevent you from
enforcing an unlawful detainer judgment that was obtained before the
tenant’s petition was filed. In some cases, however, the tenant may be
able to keep the stay in effect for 30 days after the petition is filed.
The automatic stay does not apply if your eviction action
is based on the tenant’s endangering the rental property or using
illegal controlled substances on the property, and if you file a
required certification with the bankruptcy court. The stay normally will
remain in effect, however, for 15 days after you file the certification
with the court.
A bankruptcy case can be dismissed for “cause”—for
example, if the tenant neglects to pay fees or file necessary schedules
and financial information, causes unreasonable delay that harms you, the
landlord, or files the case in bad faith.
occasions a Landlord needs counsel are 1. If the landlord is an LLC,
2. If the landlord is a Corporation. Int these case the landlord
cannot file in propria persona but will need the services of a member of
the California Bar.