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Court helps define a legal difference in eviction and bankruptcy cases

There is a distinction between the issuance of an eviction order and the execution of that order for the New York State Bankruptcy Court. A case in the Court highlights that under Bankruptcy Code §365(d)(3), a lease is “unexpired” if the eviction order has not been executed. Even if a state court “terminates” a lease, that does not mean it is ended in the Bankruptcy Code.

One company stopped paying its rent to its landlord. Soon, it filled for Chapter 7 bankruptcy. This bankruptcy placed a stay on the eviction by the landlord. In other words, the creditor, here the landlord, could not collect rent from the debtor nor continue the eviction case against the tenant. The Bankruptcy Court did not give the landlord “post-petition rent, attorney fees and prejudgment interest” that the landlord claimed was owed between the bankruptcy filing and the eviction. After reviewing cases that pertained to the N.Y. Real Property Actions and Proceedings Law §749(3), the judge ruled that the lease was “unexpired.”

If you have faced rent or lease problems or are considering bankruptcy, call the law office of Jayson Lutzky, P.C. Mr. Lutzky has over 29 years of experience practicing law and will guide you during each step of bankruptcy. To arrange a free in person, please call our office at 1-800-660-LAWYER or 1-800-660-5299. You may visit our website, www.BankruptcyNYC.com, for further information.

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