The most important facet that exists in the beginning of a bankruptcy case is the \u201cautomatic stay.\u201d\u00a0 This \u201cstay\u201d is a federal injunction that is imposed immediately upon the filing of a case.\u00a0 No further court order is needed.\u00a0 This \u201cautomatic stay\u201d is found in section 362 of the Bankruptcy Code.\u00a0 The Bankruptcy Code is found in Title 11 of the United States Code.\u00a0 Therefore, immediately upon the filing of any bankruptcy case, the injunction takes effect to prohibit acts against the debtor or the debtor\u2019s property.\u00a0 The debtor is the person, who filed for bankruptcy.\u00a0 Creditors are those to whom the debtor owes a debt.<\/p>\n
A non-exhaustive list of examples of actions that are prohibited follows:<\/p>\n
It is also a violation of the \u201cautomatic stay\u201d for a creditor to sell the debtor\u2019s property after the filing of the bankruptcy, even if the creditor legally repossessed the property prior to the filing of the case.\u00a0 This is because all property of the debtor, whether fully owned or partially owned, becomes \u201cproperty of the bankruptcy estate,\u201d and must be preserved for the debtor.\u00a0 All \u201cproperty of the estate\u201d in the possession and control of any party must be released upon the filing of a bankruptcy case.\u00a0 This is found in section 542 of the Bankruptcy Code.<\/p>\n
The property is deemed to be under the supervision of the Federal Bankruptcy Court.\u00a0 All parties, including law enforcement and\/or governmental entities, and their employees are subject to the \u201cautomatic stay.\u201d\u00a0 The power to enforce the provisions of the \u201cautomatic stay\u201d lies within the authority of the Federal Bankruptcy Court.\u00a0 Those who violate the \u201cautomatic stay\u201d can be punished under federal law via sanctions and fines.\u00a0 It is also a federal crime to tamper with \u201cproperty of the bankruptcy estate.\u201d<\/p>\n
I have litigated dozens of actions against creditors and other parties, who had violated the \u201cautomatic stay.\u201d\u00a0 In most of those cases, the party violating the \u201cautomatic stay\u201d has had to pay my attorney\u2019s fees for bringing the action, and also had to pay damages to my clients as well as punitive damages.<\/p>\n
Since we do not expect most parties to understand bankruptcy law, we always provide them an opportunity to resolve the issues without litigation, and encourage them to seek counsel from an experienced bankruptcy attorney, as opposed to simply ignoring our concerns.\u00a0 Those who have acted prudently and taken that advice, have faired well.\u00a0 However, those who have chosen to ignore our concerns have paid substantially.<\/p>\n
If you or someone you know is ever faced with the issue, please seek advice from The Cooper Law Firm.<\/p>\n","protected":false},"excerpt":{"rendered":"
The most important facet that exists in the beginning of a bankruptcy case is the \u201cautomatic stay.\u201d\u00a0 This \u201cstay\u201d is a federal injunction that is imposed immediately upon the filing of a case.\u00a0 No further court order is needed.\u00a0 This \u201cautomatic stay\u201d is found in section 362 of the Bankruptcy Code.\u00a0 The Bankruptcy Code is… Continue reading The Most Important Step in Filing A Bankruptcy Case<\/span><\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/www.thecooperlawfirm.com\/blog\/wp-json\/wp\/v2\/posts\/23"}],"collection":[{"href":"https:\/\/www.thecooperlawfirm.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.thecooperlawfirm.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.thecooperlawfirm.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.thecooperlawfirm.com\/blog\/wp-json\/wp\/v2\/comments?post=23"}],"version-history":[{"count":1,"href":"https:\/\/www.thecooperlawfirm.com\/blog\/wp-json\/wp\/v2\/posts\/23\/revisions"}],"predecessor-version":[{"id":24,"href":"https:\/\/www.thecooperlawfirm.com\/blog\/wp-json\/wp\/v2\/posts\/23\/revisions\/24"}],"wp:attachment":[{"href":"https:\/\/www.thecooperlawfirm.com\/blog\/wp-json\/wp\/v2\/media?parent=23"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.thecooperlawfirm.com\/blog\/wp-json\/wp\/v2\/categories?post=23"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.thecooperlawfirm.com\/blog\/wp-json\/wp\/v2\/tags?post=23"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}