What are the defenses to a bankruptcy motion for relief from automatic stay based on failure to pay rent?

Question from Joe, What are the defenses to a bankruptcy motion for relief from automatic stay based on failure to pay rent?

Answer from AI:

When a tenant files for bankruptcy in the United States, an automatic stay is typically put in place, which halts most collection activities, including eviction proceedings. However, landlords can file a motion for relief from the automatic stay to proceed with eviction, especially if the tenant has failed to pay rent. Here are some common defenses a tenant might use to oppose such a motion:

1. Cure of Default

If the tenant can demonstrate that they have cured the default by paying the overdue rent, this can be a strong defense. The tenant should provide proof of payment, such as receipts or bank statements.

2. Adequate Protection

The tenant might argue that the landlord is adequately protected. This means showing that the landlord’s interests are not at risk because the tenant is making regular payments or has offered a security deposit or other form of assurance.

3. Lease Assumption

Under Chapter 13 bankruptcy, the tenant may assume the lease, which means they agree to continue the lease and cure any defaults. The tenant must show that they can and will make future rent payments on time.

4. Dispute Over Rent Amount

If there is a legitimate dispute over the amount of rent owed, the tenant can argue that the motion for relief from the stay should be denied until the dispute is resolved. This might involve showing errors in the landlord’s accounting or proving that the landlord has not credited payments correctly.

5. Violation of Bankruptcy Code

The tenant can argue that the landlord’s motion violates specific provisions of the Bankruptcy Code. For example, if the landlord is attempting to collect rent that was discharged in a previous bankruptcy, this could be a violation.

6. Retaliatory Eviction

If the tenant can prove that the landlord’s motion for relief from the stay is retaliatory, such as being filed in response to the tenant exercising their legal rights (e.g., reporting housing code violations), this can be a defense.

7. Procedural Deficiencies

The tenant can argue that the landlord’s motion is procedurally deficient. This might include issues like improper service of the motion, lack of proper notice, or failure to comply with local court rules.

Steps to Take

If you are a tenant facing a motion for relief from the automatic stay, consider the following steps:

1. Review the motion carefully and gather all relevant documents, such as your lease agreement, payment records, and any correspondence with the landlord.
2. File a written opposition to the motion, outlining your defenses and providing supporting evidence.
3. Attend the court hearing and be prepared to present your case to the judge.
4. Consult with a bankruptcy attorney for personalized legal advice and representation.

Consult a Legal Professional

While these defenses can be effective, the specifics of each case can vary widely. It is crucial to consult with a legal professional who can provide personalized advice based on the details of your situation. For more information, you can refer to the [U.S. Bankruptcy Code](https://www.law.cornell.edu/uscode/text/11) and local bankruptcy court rules.

Remember, this information is intended to provide a general understanding and should not be considered legal advice. Always seek the guidance of a qualified attorney for your specific legal needs.