If your landlord is having financial trouble and has filed for bankruptcy, it may be more difficult to get a receiver. When a landlord files for bankruptcy, the landlord must put all of her property into the hands of the bankruptcy court. The court then decides how to use this property to pay the landlord's debts. In fact, if you gave your landlord a security deposit, you should receive a notice of bankruptcy proceedings because the landlord owes you money.27
To oversee the bankruptcy process, a bankruptcy judge appoints a person called the Trustee in Bankruptcy. As long as the Trustee in Bankruptcy decides to keep your building in the hands of the bankruptcy court, no other court can appoint a receiver.
There are several ways that tenants have approached this situation. One alternative is to ask both the Trustee in Bankruptcy and the bankruptcy court judge to give permission for another court to appoint a receiver.28 If your building is in really bad shape and not worth very much, you may also ask a trustee to remove the property from the bankruptcy process. This is called "abandoning the property." Once your property is abandoned by a bankruptcy court,
a judge in another court is free to appoint a receiver. Try to meet with the Trustee in Bankruptcy to find out what the plans are for your building. The trustee may be glad to abandon the property and give you helpful information.
The bankruptcy court sometimes sends tenants a notice after a landlord files bankruptcy. If you have received any written papers from the court, check to see if they have the name and phone number of a trustee. If not, call the bankruptcy court closest to you. Ask for the name and phone number of the trustee for your landlord's case. If you have difficulty getting this information from the bankruptcy court, try to get the phone number of the Trustee in Bankruptcy from your landlord or your landlord's lawyer. 27 . There are three different types of bankruptcy cases that a landlord may file: Chapter 7, Chapter 11, and Chapter 13. This section in the text applies to a Chapter 7 bankruptcy. A Chapter 7 bankruptcy is one in which a landlord is trying to sell all of her property and a trustee steps in to manage it. In a Chapter 11 or Chapter 13 bankruptcy, a landlord, not a trustee, continues to manage her property. In order to get new management in a Chapter 11 or a Chapter 13 bankruptcy case, you would need to go to bankruptcy court, as opposed to a state trial court, and ask for a new manager. Chapter 11 and Chapter 13 cases can be complicated, and tenants and tenant advocates should seek the expertise of a lawyer who specializes in bankruptcy. 28 . In Garcia v. Shea, Hampden Housing Court, CA-90-CV-0022-H (Order of March 23, 1990), the Trustee in Bankruptcy and the bankruptcy court judge gave their permission for a receivership to continue without abandonment.
Endnotes
Produced by Susan Hegel Created July 2008
