What is the automatic stay and what is its scope?
The stay bars action by all creditors to enforce their pre-bankruptcy claims against the debtor and the debtor’s property, regardless of whether the creditor had notice of the commencement of the debtor’s bankruptcy case. Filing a bankruptcy petition triggers the automatic stay. Action taken by creditors that violates the stay is not legally binding and is void. Actions of this type include filing a lawsuit against the debtor after the debtor files for bankruptcy, without permission of the Bankruptcy Court. There are limited exceptions to the stay, including for governmental agencies to enforce health, safety and public welfare laws and for domestic support obligations, among others. Creditors also can move to have the stay lifted for “cause” including lack of adequate protection of an interest in property. In addition, if a creditor is stayed as to property of the estate (for instance, property subject to the creditor’s lien, such as a mortgage), the creditor can also obtain relief fr
The stay bars action by all creditors to enforce their pre-bankruptcy claims against the debtor and the debtor’s property, regardless of whether the creditor had notice of the commencement of the debtor’s bankruptcy case. Filing a bankruptcy petition triggers the automatic stay. Action taken by creditors that violates the stay is not legally binding and is void. Actions of this type include filing a lawsuit against the debtor after the debtor files for bankruptcy, without permission of the Bankruptcy Court. There are limited exceptions to the stay, including for governmental agencies to enforce health, safety and public welfare laws and for domestic support obligations, among others. Creditors also can move to have the stay lifted for “cause” including lack of adequate protection of an interest in property. In addition, if a creditor is stayed as to property of the estate (for instance, property subject to the creditor’s lien, such as a mortgage), the creditor can also obtain relief fr
The automatic stay is triggered by the filing of a bankruptcy petition. Any action taken by a creditor in violation of the stay (such as commencement of a lawsuit against the debtor after bankruptcy filing without leave of the Bankruptcy Court, or judgment enforcement of pre-petition judgments against estate property) has no legal effect and is void. The stay bars action by all creditors to enforce their pre-bankruptcy claims against the debtor and the debtor’s property, regardless of whether the creditor had notice of the commencement of the debtor’s bankruptcy case. There are limited exceptions to the stay, including for governmental agencies to enforce health, safety and public welfare laws and for domestic support obligations, among others. Creditors also can move to have the stay lifted for “cause” including lack of adequate protection of an interest in property. In addition, if a creditor is stayed as to property of the estate (for instance, property subject to the creditor’s lie
