The Automatic Stay: Supreme Court Finds that Retaining Debtors’ Property, Despite Turnover Demands, is Not a Stay Violation
By EsqSocial Corporation 25/01/21
If a creditor is holding property of a party that files bankruptcy, is it “exercising control over” such property (and violating the automatic stay) by refusing the debtor’s turnover demands? According to the Supreme Court, the answer is no – instead, the stay under Section 362(a)(3) of the Bankruptcy Code only applies to affirmative acts that disturb the status quo as of the filing date. In other words, the mere retention of property of a debtor after the filing of a bankruptcy case does not...
By: Mintz - Bankruptcy & Restructuring Viewpoints