Landlord's Power over Bankruptcy to Evict Bad Tenants

 Posted on February 14, 2018 in Automatic Stay

A landlord can take possession of a rental fast if you're endangering the rental property or illegally using a controlled substance there. [

Bankruptcy Stopping Eviction

Two blog posts ago we got into how bankruptcy can stop a residential eviction. Basically, you can stop an eviction if you file a bankruptcy case before the landlord gets a judgment of possession. That’s a court’s decision that the landlord has the right to take possession of your rental. That means you no longer have a property right that bankruptcy law can protect. So after this judgment, the eviction can go forward (except under some unusual circumstances discussed in that earlier blog post).

Special Reasons to Evict

However, there’s a way for a landlord to quickly evict you even if you do file bankruptcy before the judgment of possession. The landlord could accuse you of one of two kinds of bad behavior:

• “endangerment of [the rental] property”
• “illegal use of controlled substances on [the] property”

(See Section 362(b)(23) of the U.S. Bankruptcy Code.)

The Procedure If a Landlord Accuses You of These

The landlord can file with the bankruptcy court a certification asserting one or both of such bad behavior. That certification would state, under penalty of perjury, either that:

• within the prior 30 days you have “endangered [the rental] property” or else have “illegally used or allowed to be used a controlled substance on the property”
• an eviction proceeding had been filed asserting such facts

(Again, see Section 362(b)(23) of the Bankruptcy Code.)

Defeating the Landlord’s Certification

If you take no action in response to the landlord’s filed certification, 15 days later it can proceed to evict. If the landlord started the eviction before you filed bankruptcy, it can finish it. If it hadn’t started before, it could now start and complete the eviction. Your bankruptcy’s usual protection against the landlord taking possession of your rental property would no longer apply. (See Section 362(m)(3).)

However, if you dispute what the landlord states in its certification, you can file an objection to it. You and your bankruptcy lawyer must file the objection at the bankruptcy court within 15 days of the certification’s filing. You’d have to object “to the truth or legal sufficiency of the certification.”

The bankruptcy court then holds a hearing within 10 days. It rules on whether “the situation giving rise to the [landlord’s] certification... existed or has been remedied.” If the court is convinced that the “situation... did not exist or has been remedied,” the automatic stay protection continues.

Otherwise, the court allows the landlord to immediately proceed with eviction.

(See Section 362(m)(1 and 2).)

Conclusion

Bankruptcy stops a residential eviction if the landlord hasn’t already gotten a judgment of possession. But if the landlord has grounds that you were a bad tenant as outlined above, then you can be evicted even if your bankruptcy filing happens before the judgment. You can fight back and still win if the facts are in your favor. If so then you are protected from eviction during the 3-4 months of your Chapter 7 bankruptcy case. That would hopefully give you time to catch up on your rent or cure whatever else is wrong. Or if necessary Chapter 13 would likely give you much more time to catch up or cure.