New Laws in Landlord Tenancy and Bankruptcy?
Let us say if you are behind on rent payments, can your landlord evict you while you file for bankruptcy?
This question has been asked many times from our clients. We had tried to answer it in simple ways here. The answer depends upon whether your residential landlord has only threatened to evict you or in fact got an eviction judgment against you. The new bankruptcy law has changed this equation for ever. Under this law, if your landlord has already begun eviction proceedings in state court and has obtained a judgment for possession of the residential premises before you file for bankruptcy, the landlord can evict you unless, the debtor do two things.
1. File a certification with the bankruptcy court, along with your bankruptcy petition, that there are circumstances under applicable non bankruptcy rules that would allow you reinstate the residential lease and cure the monetary default; and
(2) pay 30 days rent to the bankruptcy court clerk to be transmitted to the landlord. The landlord can still object, in which case the bankruptcy court must decided within ten days of the filing of the objection whether the landlord can proceed with the eviction in order to gain possession of the rental property. Then you must also file a second certification with the bankruptcy court, within thirty days of filing your bankruptcy petition, stating the pre-petition default that gave rise to the landlord’s judgment for possession in state court has been cured –in other words, that you have paid all back rent. Even after you file this second certification, however, the landlord may still object, in which case the court must determine within ten days of the objection whether the landlord can proceed with the eviction action.
The law also provides that, if the residential landlord has begun eviction proceedings before you file for bankruptcy on the grounds that you have endangered the rental property or have used or allowed others to use illegal substances on the property, all the landlord has to do is file a certification to this effect with the bankruptcy court clerk. The landlord can then proceed with the eviction process fifteen days later if the debtor does not object. Note that the law does allow you to object within fifteen days and, at a hearing, show the bankruptcy court that the situation has been remedies or never existed in the first place. At that point, it will be up to the bankruptcy court to decide whether your landlord can proceed or not. The deadlines in these kinds of situations are very short. It is good to contact an experienced and knowledgeable attorney in these matters.