Page 8 - NBIZ October 2021
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                 Guide to



                                       By Angeline Vachris Kell and Stacey L. Kremling

                     here are two types of   automatic stay that stops all creditor   obtain possession of the leased space
                     claims that commercial   actions against the debtor and the   or exercise control over the premises
                     landlords need to       property of the bankruptcy estate.   of the estate stays. In other words,
                     know in regards to                                          a landlord could face penalties from
                     bankruptcy. There       The Automatic Stay Stops All        enforcing, collecting, or recovering
         Tare ubiquitous proofs              Actions Against the Tenant under    past due rents or attempting to evict a
         of claims for secured or unsecured   11 U.S.C. 362                      tenant in bankruptcy.
         claims and administrative claims.      At the commencement of a bank-
         Administrative claims are requests   ruptcy, the landlord should be aware   Proofs of Claim and
         for necessary costs and expenses of   that the filing triggers the automatic   Rejected Leases
         preserving the bankruptcy estate.   stay, which bars all actions taken by   After the bankruptcy is filed, a
         These administrative claims may     creditors against the tenant/debtor.   notice will inform the creditors of the
         include post-petition rent payments.   Under Section 362 of the Bankruptcy   timing to file proofs of claims. If the
            First, it is necessary to address   Code, any attempts by a landlord to   debtor is a tenant, then the debtor will
         the automatic stay. Any general     enforce, collect, or recover a claim   also decide to reject or assume the
         information on bankruptcy should    from the debtor is stopped by the   executory contracts including com-
         also include a reminder about the   automatic stay. Further, any act to   mercial leases. If the debtor rejects

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