1 / 18

YOUR TENANT HAS FILED FOR BANKRUPTCY PROTECTION Effects on PHA Policies & Evictions

YOUR TENANT HAS FILED FOR BANKRUPTCY PROTECTION Effects on PHA Policies & Evictions. Clare Ann Fitzgerald, Esquire Housing Authority of the City of Pittsburgh fitzgec@hacp.org James M. Smith, Esquire Law Offices of James M. Smith, Esquire jsmith@jmslawoffice.com.

mercer
Download Presentation

YOUR TENANT HAS FILED FOR BANKRUPTCY PROTECTION Effects on PHA Policies & Evictions

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. YOUR TENANT HAS FILED FORBANKRUPTCY PROTECTIONEffects on PHA Policies & Evictions Clare Ann Fitzgerald, Esquire Housing Authority of the City of Pittsburghfitzgec@hacp.org James M. Smith, EsquireLaw Offices of James M. Smith, Esquirejsmith@jmslawoffice.com HDLI 2007 FALL LEGAL CONFERENCE – SAN DIEGO, CALIFORNIA

  2. YOUR TENANT HAS FILED FORBANKRUPTCY PROTECTIONEffects on PHA Policies & Evictions (a) . . . the trustee . . . may assume or reject any . . . unexpired lease of the debtor.(b)(1) If there has been a default in an . . . unexpired lease of the debtor, the trustee may not assume such . . . lease unless, at the time of assumption of such . . . lease, the trustee — (A) cures, or provides adequate assurance that the trustee will promptly cure, such default other than a default that is a breach of a provision relating to the satisfaction of any provision (other than a penalty rate or penalty provision) relating to a default arising from any failure to perform nonmonetary obligations under an unexpired lease of real property, if it is impossible for the trustee to cure such default by performing nonmonetary acts at and after the time of assumption, except that if such default arises from a failure to operate in accordance with a nonresidential real property lease, then such default shall be cured by performance at and after the time of assumption in accordance with such lease, and pecuniary losses resulting from such default shall be compensated in accordance with the provisions of this paragraph; (B) compensates, or provides adequate assurance that the trustee will promptly compensate, a party other than the debtor to such . . . lease, for any actual pecuniary loss to such party resulting from such default; and (C) provides adequate assurance of future performance under such contract or lease. . . . (d)(1) In a case under chapter 7 of this title, if the trustee does not assume or reject an . . . unexpired lease of residential real property . . . within 60 days after the order for relief . . . then such contract or lease is deemed rejected. 11 U.S.C.A. § 365 HDLI 2007 FALL LEGAL CONFERENCE – SAN DIEGO, CALIFORNIA

  3. YOUR TENANT HAS FILED FORBANKRUPTCY PROTECTIONEffects on PHA Policies & Evictions ... a governmental unit may not deny, revoke, suspend, or refuse to renew a license ... or other similar grant to, ... [or] discriminate with respect to such a grant against ... a person that is or has been a ... debtor under the Bankruptcy Act, ...solely because such ... debtor is or has been a ... debtor under the Bankruptcy Act .... 11 U.S.C.A. § 525 HDLI 2007 FALL LEGAL CONFERENCE – SAN DIEGO, CALIFORNIA

  4. YOUR TENANT HAS FILED FORBANKRUPTCY PROTECTIONEffects on PHA Policies & Evictions ... a governmental unit may not deny, revoke, suspend, or refuse to renew a license ... or other similar grant to, ... [or] discriminate with respect to such a grant against ... a person that is or has been a ... debtor under the Bankruptcy Act, ...solely because such ... debtor is or has been a ... debtor under the Bankruptcy Act .... 11 U.S.C.A. § 525 HDLI 2007 FALL LEGAL CONFERENCE – SAN DIEGO, CALIFORNIA

  5. YOUR TENANT HAS FILED FORBANKRUPTCY PROTECTIONEffects on PHA Policies & Evictions “A Governmental Unit” -- Includes properties owned by local government bodies -- Does NOT include Section 8 properties owned by private individuals/entities HDLI 2007 FALL LEGAL CONFERENCE – SAN DIEGO, CALIFORNIA

  6. YOUR TENANT HAS FILED FORBANKRUPTCY PROTECTIONEffects on PHA Policies & Evictions ... a governmental unit may not deny, revoke, suspend, or refuse to renew a license ... or other similar grant to, ... [or] discriminate with respect to such a grant against ... a person that is or has been a ... debtor under the Bankruptcy Act, ...solely because such ... debtor is or has been a ... debtor under the Bankruptcy Act .... 11 U.S.C.A. § 525 HDLI 2007 FALL LEGAL CONFERENCE – SAN DIEGO, CALIFORNIA

  7. YOUR TENANT HAS FILED FORBANKRUPTCY PROTECTIONEffects on PHA Policies & Evictions “Other Similar Grant” The Question: What is the GRANT? HDLI 2007 FALL LEGAL CONFERENCE – SAN DIEGO, CALIFORNIA

  8. YOUR TENANT HAS FILED FORBANKRUPTCY PROTECTIONEffects on PHA Policies & Evictions “Other Similar Grant” The Question: What is the GRANT? 1. The Lease, itself? HDLI 2007 FALL LEGAL CONFERENCE – SAN DIEGO, CALIFORNIA

  9. YOUR TENANT HAS FILED FORBANKRUPTCY PROTECTIONEffects on PHA Policies & Evictions “Other Similar Grant” The Question: What is the GRANT? 1. The Lease, itself? 2. The right to subsidized rent? HDLI 2007 FALL LEGAL CONFERENCE – SAN DIEGO, CALIFORNIA

  10. YOUR TENANT HAS FILED FORBANKRUPTCY PROTECTIONEffects on PHA Policies & Evictions “Other Similar Grant” The Question: What is the GRANT? 1. The Lease, itself? 2. The right to subsidized rent? 3. The future right to continue participating in public housing. HDLI 2007 FALL LEGAL CONFERENCE – SAN DIEGO, CALIFORNIA

  11. YOUR TENANT HAS FILED FORBANKRUPTCY PROTECTIONEffects on PHA Policies & Evictions “Other Similar Grant” The Question: What is the GRANT? 1. The Lease, itself? 2. The right to subsidized rent? √ 3. The future right to continue participating in public housing. HDLI 2007 FALL LEGAL CONFERENCE – SAN DIEGO, CALIFORNIA

  12. YOUR TENANT HAS FILED FORBANKRUPTCY PROTECTIONEffects on PHA Policies & Evictions “Other Similar Grant” The Question: What is the GRANT? 1. The Lease, itself? 2. The right to subsidized rent? √ 3. The future right to continue participating in public housing. Waiting line? - No? Why are you evicting? - Yes? Fresh Start provisions require that Tenant be permitted to re-apply and be treated in the application process identically to any other tenant applying for the same unit. HDLI 2007 FALL LEGAL CONFERENCE – SAN DIEGO, CALIFORNIA

  13. YOUR TENANT HAS FILED FORBANKRUPTCY PROTECTIONEffects on PHA Policies & Evictions “Other Similar Grant” The Question: What is the GRANT? 1. The Lease, itself? 2. The right to subsidized rent? √ 3. The future right to continue participating in public housing. Waiting line? - No? Why are you evicting? - Yes? Fresh Start provisions require that Tenant be permitted to re-apply and be treated in the application process identically to any other tenant applying for the same unit. “[T]o the extent there are equally eligible financially disadvantaged persons waiting for housing, debtor’s fresh start is not intended to be a head start and [he/she] will have to take [his/her] place in line to gain access to a unit.” “[T]he fresh start policy does not require the State to insulate a debtor from any and all adverse consequences of a bankruptcy filing.” Judge Diane Sigmund, In re Bacon, 212 B.R. 66 (Bankr.E.D.Pa. 1997) HDLI 2007 FALL LEGAL CONFERENCE – SAN DIEGO, CALIFORNIA

  14. YOUR TENANT HAS FILED FORBANKRUPTCY PROTECTIONEffects on PHA Policies & Evictions ... a governmental unit may not deny, revoke, suspend, or refuse to renew a license ... or other similar grant to, ... [or] discriminate with respect to such a grant against ... a person that is or has been a ... debtor under the Bankruptcy Act, ...solely because such … debtor is or has been a ... debtor under the Bankruptcy Act.... 11 U.S.C.A. § 525 HDLI 2007 FALL LEGAL CONFERENCE – SAN DIEGO, CALIFORNIA

  15. YOUR TENANT HAS FILED FORBANKRUPTCY PROTECTIONEffects on PHA Policies & Evictions “Solely Because ...” In rem arguments often considered illusory and dismissed. HDLI 2007 FALL LEGAL CONFERENCE – SAN DIEGO, CALIFORNIA

  16. YOUR TENANT HAS FILED FORBANKRUPTCY PROTECTIONEffects on PHA Policies & Evictions “Solely Because ...” In rem arguments often considered illusory and dismissed. If Tenant is in violation of lease for more than failure to timely pay rent, pursue eviction on ALL GROUNDS, not just failure to pay rent. HDLI 2007 FALL LEGAL CONFERENCE – SAN DIEGO, CALIFORNIA

  17. YOUR TENANT HAS FILED FORBANKRUPTCY PROTECTIONEffects on PHA Policies & Evictions “Solely Because ...” In rem arguments often considered illusory and dismissed. If Tenant is in violation of lease for more than failure to timely pay rent, pursue eviction on ALL GROUNDS, not just failure to pay rent. CAVEAT . . . The U.S. Supreme Court case of Federal Communications Comm’n. v. NextWave Personal Communications, Inc., 537 U.S. 293, 123 S.Ct. 832, 154 L.Ed.2d 863 (2003), has been viewed as holding that: “if a housing authority proffered several compelling reasons to evict a debtor, in addition to the failure to pay pre-petition rent, these reasons would be of no import so long as it is established that the event that caused the housing authority to evict the debtor was the failure to pay pre-petition rent. In other words, if the housing authority would not have sought to evict but for the failure to pay pre-petition rent, then the action taken by the housing authority is ‘solely because’ of the failure to pay a dischargeable debt.” Judge Thomas Twardowski, In re Valentin, 309 B.R. 715, 722 n.9 (E.D.Pa. 2004) HDLI 2007 FALL LEGAL CONFERENCE – SAN DIEGO, CALIFORNIA

  18. YOUR TENANT HAS FILED FORBANKRUPTCY PROTECTIONEffects on PHA Policies & Evictions “Solely Because ...” In rem arguments often considered illusory and dismissed. If Tenant is in violation of lease for more than failure to timely pay rent, pursue eviction on ALL GROUNDS, not just failure to pay rent. CAVEAT . . . The U.S. Supreme Court case of Federal Communications Comm’n. v. NextWave Personal Communications, Inc., 537 U.S. 293, 123 S.Ct. 832, 154 L.Ed.2d 863 (2003), has been viewed as holding that: Note: Post-petition violations of lease are not entitled to the protection of the Bankruptcy Court – File Motion for Relief from Automatic Stay nonetheless “if a housing authority proffered several compelling reasons to evict a debtor, in addition to the failure to pay pre-petition rent, these reasons would be of no import so long as it is established that the event that caused the housing authority to evict the debtor was the failure to pay pre-petition rent. In other words, if the housing authority would not have sought to evict but for the failure to pay pre-petition rent, then the action taken by the housing authority is ‘solely because’ of the failure to pay a dischargeable debt.” Judge Thomas Twardowski, In re Valentin, 309 B.R. 715, 722 n.9 (E.D.Pa. 2004) HDLI 2007 FALL LEGAL CONFERENCE – SAN DIEGO, CALIFORNIA

More Related