Automatic Stay

An understanding of the US Bankruptcy Code’s “automatic stay” provisions is essential to understanding how bankruptcy law can help you.  You should study when it applies and when it does not. Bankruptcy stays principally arise out of Sections 362, 1301, and 105. The mere filing of a chapter 7 case automatically triggers the Section 362 stay; whereas the filing of a chapter 13 case automatically triggers both the Sections 362 and 1301 stays. The Section 105 stay is imposed only after a motion and hearing---similarly to an injunction motion.


The automatic stay prohibits the commencement or continuation of judicial proceedings that were or could have been commenced prior to the bankruptcy case filing, with some exceptions. These exceptions should be discussed in future writings. The stay also prohibits creditors from non-judicial attempts to collect non-exempt debts owed prepetition, including attempts via phone, fax, email, letter, etc.

Creditors need to proceed with great caution, as if treading carefully on a mine field. On one hand, unintentional violation of the stay may needlessly wastes the court’s and litigants’ time and treasury. An action that violates Section 362 is either void or voidable; consequently, the results of a protracted proceeding may be a nullity or may be nullified. On the other hand, an intentional violation of the automatic stay may result in the above plus sanctions, including damages, costs, attorney fees, and even punitive damages for egregious conduct. The sanction could even be assessed against the attorney!

Warmest Regards,

Bob Schaller


Your Bankruptcy Advisor Blog
By: Attorney Robert Schaller (Bob's bio) of the Schaller Law Firm

Bob is a member of the National Bankruptcy College Attorney Network, American Bankruptcy Institute and the National Association of Consumer Bankruptcy Attorneys.

I encourage you to SUBSCRIBE to this blog by completing the box to the right of this post so you will automatically receive future blog postings. Next, you can review past and future blogs at any time by clicking the "archive" link in the column to the right of this posting. Plus, you are invited to submit a question by utilizing the "question" box in the column to the right of this posting.


For information about Chapter 7 bankruptcy Click Here

For information about Chapter 13 bankruptcy Click Here

You are invited to contact Attorney Schaller at 630-655-1233 or visit his website at http://www.schallerlawfirm.com/to learn about how the bankruptcy laws can help you.

NOTE: Robert Schaller looks forward to the opportunity to talk with you about your legal issues. But please remember that all information on this blog is for advertising and general informational purposes only. Please read Bob's disclaimer.

I recommend that you review a few other blogs that may be of interest to you. These blogs are identified in the right column and are set forth below: bankruptcy issues blog; bankruptcy and family law issues blog; bankruptcy and employment issues blog; and bankruptcy and student loan issues blog.