Q: My tenant is two months behind on his rent He told me if I try to evict him he will file bankruptcy to stop the eviction, can he do that?
A: Yes, if your tenant files bankruptcy before or during an eviction it will cause a delay, but only for a certain period of time and only under certain conditions. A person that files bankruptcy is called a debtor. Anyone he owes money to can be added as a creditor in the bankruptcy case, including a landlord. When a tenant files bankruptcy it automatically stays or stops all state court proceedings against the tenant.
The court and the parties are not allowed to do anything in the case until the stay is lifted. The stay is not lifted until the bankruptcy court grants a party relief from stay, or the bankruptcy is dismissed. In most cases the landlord will have to file a motion for relief from the automatic bankruptcy stay to continue the eviction proceedings. If the landlord tries to move forward with the eviction while the bankruptcy stay is in place, then the landlord would be held liable for damages. If your tenant files bankruptcy, then you should immediately consult with an attorney before serving any notice or starting eviction proceedings.
Q: What is a motion for relief from the automatic bankruptcy stay?
A: This is a written request to the Bankruptcy Court to allow the landlord, whose tenant filed bankruptcy, to move forward with an eviction case in state court. If the Bankruptcy Court grants the motion, then the landlord can go forward with his eviction. If the Bankruptcy Court denies the motion, then the landlord has to wait until the bankruptcy case ends before he or she may move forward with the eviction against the tenant/debtor.
Q: What if one of the tenants in my unit filed bankruptcy and I just want to serve them with a three day notice to pay rent or quit? I am not planning on filing an unlawful detainer in court yet, do I still have to file a motion for relief from the automatic bankruptcy stay?
A: Yes. The automatic bankruptcy stay applies to any act by any creditor to request or accept payment from a debtor. Further, by serving a three-day notice to pay rent or quit, you are taking the first step to initiate a state law eviction proceeding. Thus, the landlord cannot serve the notice first without obtaining permission from the bankruptcy court to do so. Otherwise, the landlord will request payment from a bankruptcy debtor in violation of the bankruptcy stay. So even if you may not file an eviction, you should still file a motion for relief from the automatic stay before you serve the tenant with a three-day notice to pay rent or quit notice.
Q: What happens if I just go forward with my eviction and I don’t attempt to get relief from the automatic bankruptcy stay?
A: A violation of the automatic bankruptcy stay carries serious consequences. If you go forward with your eviction after the tenant/debtor informs you that they filed bankruptcy, the tenant can then go after you in bankruptcy court to collect monetary damages. Thus, if your tenant files bankruptcy you should immediately consult with an attorney to determine if or how you may proceed forward with your eviction.
Q: If I’ve already filed an unlawful detainer, how long does it take to get relief from the automatic stay before I can continue with my eviction?
A: The period of time it takes get relief from stay is dependent on the particular case. Sometimes you can ask the court to hear your motion on an emergency basis. If not, you have to file your motion and wait for the tenant/debtor to respond. If the tenant/debtor responds and opposes your motion you will have to go to a hearing before a bankruptcy judge. If your motion is granted, you then have to wait for the judge to sign the order granting you relief. In some cases, you may have to wait an additional two weeks after the order is signed before you may go forward with your eviction. If the tenant/debtor does not respond to your motion it will generally take less time to get your order signed by a bankruptcy judge so you may move forward with your eviction sooner.
Attorney Franco Simone, of the Landlords Legal Center and has been doing evictions for 20 years. He is also an adjunct law professor at the University of San Diego. Mr. Simone’s office is open Monday- Friday from 9:00 AM to 5:00 PM . Tel: 619-235-6180, website: www.landlordslegalcenter.com or email [email protected]