I'm at work currently trying to figure out which kind of law applies to one of our shopping center tenants who is undergoing bankruptcy and doesn't want to pay rent.
I am filing a claim, but do not know if it should be unsecured or secured and under which 11 U.S.C. 507 (a) (_________) priority our trying to obtain October's rent applies to.
Someone out there has to know more on this issue and might be able to help.
Thank you!
2007-12-07 04:52:39 · 3 answers · asked by J G 1 in Business & Finance ➔ Renting & Real Estate
Well, our tenant is Movie Gallery. They filed a Chapter 11 to Facilitate Pre-Negotiated Debt Restructuring and didn't pay us rent for a month. They e-mailed us a link to a modified Form B10 for us to mail to the US Bankruptcy Court.
I don't know if this is sufficient or even if it works. Within the document I'm being asked which kind of claim it is, etc.
Please e-mail me if you believe you can help me further and write bankruptcy on the subject line header. Thank you!
2007-12-07 05:15:14 · update #1
aaah, my email is jgam729@yahoo.com
2007-12-07 05:16:35 · update #2
Secured debt is always better protection for the creditor than unsecured, but in your case, what is there to secure the debt with? You own the property, not the tenant. If the tenant owned the property and you held the mortgage, you could foreclose, but the most you can do to a tenant is eviction. If they filed a Chapter 7 liquidation, they'll be evicted anyway eventually, but you are unsecured and will have to wait in line. Vendors who sell to them may have liens against goods and be able to take them back, so they would be in better shape than you in at least recovering something.
If they filed a Chapter 11 reorganization, evicting them may be a matter decided by the bankruptcy judge, but you stand a better chance of receiving some of your rent money.
2007-12-07 05:06:20 · answer #1 · answered by curtisports2 7 · 1⤊ 0⤋
You should consult a bankruptcy attorney. If they aren't paying rent, you need to lift the stay if you want to evict them. Your debt is unsecured, and you have an executory lease. If they don't assume it in the chapter 11 plan, then they are rejecting it which results in a breach of the lease. They do not get to just stay there without paying rent, so you really should see an attorney asap.
2007-12-10 04:11:34 · answer #2 · answered by Lesley 5 · 0⤊ 0⤋
I would recommend speaking with an attorney if you can't figure out which code it should be classified under. Good luck!!!
2007-12-07 13:04:04 · answer #3 · answered by tom_gpp 5 · 0⤊ 0⤋