Legal Question in Bankruptcy in New Mexico
Secured claim in a bankruptcy case
I am the landlors for a commercial tenant who has filed for chapter 13. The tenant filed his petition on the same day the I was awarded a judgement for rent in arrears. Do I have a secured, unsecured nonpriority, or unsecured priority claim? There is a standard lease on the property.
1 Answer from Attorneys
Tenant in Ch. 13
One thing is clear: you don't have a priority claim. You probably have an unsecured claim unless you have a perfected security interest (security agreement and recorded financing statement apart from the lease), or under your state's law you have a lien on the tenant's property in your premises. However, in reality your situation in the bankruptcy depends less on the proof of claim than on what happens with the lease. The debtor or trustee may seek to assume your lease, in which they have to bring it current within a reasonable time. They must move to assume within 60 days of filing. If they don't, and don't get the time extended, the lease is deemed rejected. A rejected lease entitles you to damages (rent less any mitigtion) for the remaining term of the lease or one year, whichever is longer. This is an unsecured claim, in addition to your claim for pre-petition rent. Also, note that to evict the tenant you need to obtain relief from the automatic stay. Do not take any action against the tenant or his property without an order authorizing you to do so. Bottom line: get a bankruptcy lawyer to represent your interests.