Sat, 04 Apr 2026 00:23:48 -0700WeeblySun, 23 Nov 2014 23:21:56 GMThttps://www.ny-bankruptcy-lawyer.net/bankruptcy-blog/a-rent-stabilized-apartment-tenant-in-new-york-city-may-now-file-a-consumer-personal-bankruptcy-under-chapter-7-without-fear-of-losing-his-or-her-apartment-leaseNew York Court of Appeals held ( in Santiago-Monteverde v. Pereira ) on November 20, 2014 that Section 282(2) of New York State Debtor and Creditor Law exempts a debtor-tenant’s interest in a rent stabilized lease.  This essentially means that a rent stabilized apartment tenant in New York City may file a consumer (personal) bankruptcy under Chapter 7 without fear of losing his or her apartment lease.  

The Court reasoned that: 

When the rent stabilization regulatory scheme is considered against the backdrop of the crucial role in the lives of New York residents, and the purpose and effect of the program, it is evident that a tenant’s rights under a rent stabilized lease are a local public assistance benefit. 

The legislature had concluded that rent stabilization was necessary to preserve affordable housing for low-income, working poor and middle class residents in New York City.  The rent stabilization system began in 1969 to ameliorate over time the intractable housing emergency in New York City due to housing shortage which was caused by a continued high demand and decreasing supply.  By regulating rents and providing occupants with statutory rights to tenancy renewals under rent stabilization, the State intended to protect dwellers who could not compete in an overheated rental market through not fault of their own.  Indeed, the New York City administrative code provided that unless residential rents and evictions continue to be regulated and controlled, disruptive practices and abnormal conditions will produce serious threats to the public health, safety, and general welfare.     ( Admin. Code of the City of New York § 26-501)

The rent stabilization law has all the characteristics of a local public assistance benefit.  It is local because it depends on periodic determinations by local authorities as to the continuing existence of an emergency in the particular jurisdiction. 

The program is public because it was enacted by the New York State legislature and implemented by legislative and administrative bodies at both the state and local level. 


If you are interested, the complete decision can be found here: http://www.nycourts.gov/ctapps/Decisions/2014/Nov14/180opn14-Decision.pdf


Christopher Tompkins is a Bankruptcy Attorney that has been handling Chapter 7 Matters for 20 years for Queens and Brooklyn residents in New York City.  Contact him at 212 962-5363. Email: AttyBankruptcy@gmail.com.   Visit his website at http://www.ny-bankruptcy-lawyer.net/








]]>Sun, 30 Mar 2014 22:44:46 GMThttps://www.ny-bankruptcy-lawyer.net/bankruptcy-blog/where-do-chapter-7-bankruptcy-proceedings-take-place-for-brooklyn-and-queens-residents          If you live in Queens or Brooklyn and file for Chapter 7 Bankruptcy, all court proceedings and the 341 Meeting of Creditors take place in Brooklyn. Which means if there is a trial related to an adversary proceeding ( for example, to determine if there is hardship to discharge a student loan), or a hearing on a motion ( for example, to vacate the automatic stay on child support collection or eviction proceedings), it would take place at the U.S. Bankruptcy Court for the Eastern District of New York located at 271-C Cadman Plaza East, Brooklyn, NY 11201. The Bankruptcy Court is located in the landmark General Post Office (GPO) building which looks somewhat like a medieval castle. 
          Most Chapter 7 bankruptcy cases for Queens and Brooklyn residents are no asset cases requiring only a one time appearance at the 341 meeting of creditors without any type of trial or hearing on a motion provided that the Chapter 7 debtor acts in good faith (honest with all his or her statements on the bankruptcy schedules and with his or her financial activities prior to filing for Chapter 7 Bankruptcy).  A Chapter 7 Bankruptcy Lawyer should always be consulted prior to filing for bankruptcy to see if you qualify. 


Christopher Tompkins is a Bankruptcy Attorney that has been handling Chapter 7 Matters for 20 years for Queens and Brooklyn residents in New York City.  Contact him at 212 962-5363. Email: AttyBankruptcy@gmail.com.   Visit his website at http://www.ny-bankruptcy-lawyer.net/
]]>Sun, 16 Mar 2014 00:48:58 GMThttps://www.ny-bankruptcy-lawyer.net/bankruptcy-blog/what-happens-at341-meeting-of-creditors-in-chapter-7-bankruptcy           
              A 341 Meeting of Creditors in Chapter 7 Bankruptcy is a meeting between the Chapter 7 trustee ( an appointed lawyer), the debtor ( person filing bankruptcy), creditors, and in some cases, an attorney from the U.S. Trustee's Office.  An attorney for the debtor should also attend the meeting. If the debtor fails to attend the 341 Meeting the Chapter 7 trustee has authority to move to dismiss the case.   
             The 341 Meeting is held approximately 45 days from the day that the Chapter 7 bankruptcy petition is filed.  The debtor must bring a signed copy of the debtors' Chapter 7 petition and schedules, a copy of the most recently filed federal income tax return, and copies of pays stubs for the period 60 days before the bankruptcy filing.  If paystubs are not available or the debtor does not have paystubs because of self employment, the debtor must provide an affidavit to explain the circumstances.  If the debtor is not required to file a tax return, the debtor must also provide an affidavit explaining the circumstances.  The debtor must also bring his or her social security card and a driver license or non-driver identification ( from department of motor vehicles) showing the debtor's current address.
             The meeting has several purposes. One purpose of the meeting is to examine ( question) the debtor under oath about the statements contained in the debtor's bankruptcy petition and schedules to determine if the debtor is credible. It is important that the debtor be truthful.  Untruth testimony could lead to an objection to the debtor's discharge and a criminal investigation by the FBI.  The 341 meeting examination is also used to determine if the debtor has non-exempt assets available for the Chapter 7 trustee to sell and pay creditor claims against the bankruptcy estate.  The bankruptcy estate is the debtor's non-exempt assets ( Assets the debtor can not keep upon filing bankruptcy which the trustee takes control of).  Lastly, a 341 meeting examination may be used as a discovery tool to determine if the debtor's debts are dischargeable under the law.  For example, a debt may not be dischargeable because the debtor committed bankruptcy fraud,  because the debtor committed a crime or a certain type of civil tort, or because the debt is one of a category of debts that are not dischargeable such as certain types student loans and certain types of taxes.  A Chapter 7 Bankruptcy  attorney should be contacted to determine what type of debts are dischargeable since the dischargeability of debts is a complex area of the law. 
           The debtor will be asked questions about his or her assets, liabilities, financial affairs, bank accounts, and transfer of assets.  Questions are also asked more specifically about intangible assets such as personal injury claims, pending or potential lawsuits, and potential inheritance.
           Most Chapter 7 cases are no-asset cases. The debtor has no assets that the Chapter 7 trustee can take control of, sell, and pay creditor claims.  In those type of cases, creditor attorneys are not likely to attend the meeting since there is nothing for the creditor to make a claim against.  The Chapter 7 trustee is then the only person who questions the debtor. 
           The 341 Meeting of Creditors for most debtors takes approximately 5 to 10 minutes to conduct. Waiting time in the meeting rooms varies from 30 minutes up to 2 hours depending on how many cases there are before your case is called.  
            It is very important that the debtor's attorney properly prepare the debtor before the debtor gives sworn testimony about his or her petition and schedules so that there are no surprises during the meeting and so that the debtor can clear up any mistakes that were in his or her papers.  Preparation for the 341 meeting also helps to put the debtor at ease since he or she will know what questions he or she can expect from the Chapter 7 trustee and creditor attorneys.  Preparation means going over all the information contained in the petition and schedules with the debtor and providing the debtor with questions that the Chapter 7 trustee is likely to ask. 
           Since the debtor's credibility will be determined in part by his or her demeanor, it is important that the debtor dress conservatively. It is recommended that the debtor dress casual but neat or in business attire.  The debtor should not wear overly casual clothing such as shorts, T-shirts, or ripped jeans since the appearance before the Chapter 7 trustee should be respectful.  Although the trustee is not a judge, the Chapter 7  trustee has power to move dismiss your case, and to move for an order avoiding a transfer ( sale or gift) of property made to third parties ( or creditors) before the filing of the bankruptcy petition.  
           If the Chapter 7 trustee is satisfied with the debtor's testimony, he will close the meeting.  Otherwise, he may adjourn the meeting so the debtor can come back and provide additional documentation (such as bank statements, deeds, contracts, divorce agreements)  and testimony at a later date.  Creditors have 60 days from the 341 meeting to file complaints objecting to the discharge of the debtor generally and/or to the dischargeability of a particular debt. 
          
]]>Fri, 28 Feb 2014 15:58:25 GMThttps://www.ny-bankruptcy-lawyer.net/bankruptcy-blog/are-debts-that-are-discharged-in-bankruptcy-taxable-income          When not filing bankruptcy, in most cases, cancellation of a debt or loan forgiveness creates a taxable event.  This means that the amount of the cancelled debt is treated as income that is taxable. Example, you reach a deal with a credit card bank to pay only $7,000 on a $10,000 debt. The $3,000 you saved is income to you that is taxable.  There are exceptions. 
           One exception is for insolvent debtors. Insolvent debtors do not pay tax on the amount of cancelled debt  that is less the amount of the insolvency. Exclude from gross income debt that is cancelled up to amount by which the debtor is insolvent.  Insolvency is the amount that liabilities exceed the fair market value of assets.  So for example,  a debtor who has assets of $10,000 but liabilities of $15,000 would be insolvent by $5,000. If that same individual that was insolvent in the amount of $5,000 and had $6,000 in cancelled debt, only $1,000 of the cancelled debt would be taxable. See IRS publications 908 and 525 for more information.  A tax accountant or tax attorney should be consulted if you will not be filing bankruptcy but have cancelled debt.  
             The other exception is for a debtor who files for bankruptcy. Debts that are discharged in bankruptcy, however, do not create a taxable event.  See, IRS Publication 908.   ]]>Thu, 20 Feb 2014 22:29:51 GMThttps://www.ny-bankruptcy-lawyer.net/bankruptcy-blog/married-same-sex-couples-can-now-file-bankruptcy-jointly     The Federal Government will now treat legally Married Same Sex Couples the same as heterosexual couples in Bankruptcy even in states that do not recognize same sex marriage according to a policy memo released by the Department of Justice in February 2014. This means, so long as the marriage occurred in a state that permits same sex marriage, federal bankruptcy rights will extend to the couple in all 50 states. 
     These new bankrutpcy rights follow a 2013 ruling of the U.S. Supreme Court when it  declared unconstitutional the refusal of federal benefits to legally married same-sex couples.  ]]>Tue, 11 Feb 2014 22:38:23 GMThttps://www.ny-bankruptcy-lawyer.net/bankruptcy-blog/a-warning-to-debtors-that-live-in-rent-stabilized-apartments-in-new-york-city-if-you-file-bankruptcy-you-may-lose-your-rent-stabilized-apartment-to-your-landlord               A Chapter 7 bankruptcy debtor living in a residential rent stabilized apartment may forfeit his or her possession rights if a decision by Bankruptcy Judge in the Southern District of New York is upheld in the United States Court of Appeals for the Second Circuit.  Which means if you file bankruptcy you may lose your rent stabilized apartment to your landlord who could buy those rights from the Chapter 7 trustee.               Normally, when filing Chapter 7 Bankruptcy a debtor may keep exempt assets. Exempt assets are those assets that do not become part of the bankruptcy estate once a bankruptcy petition is filed.  In other words, exempt assets are not surrendered to the Chapter 7 trustee to liquidate and pay your creditors like non-exempt assets are.  
               A recent holding  in the Bankruptcy Court for the Southern District of New York, however, does not allow you keep  your possession rights in a rent stabilized apartment.  In the case of  In re Mary Veronica Santiago-Monteverde No. 11-15494 (JMP) SDNY decided on April 10, 2012,  Bankruptcy Judge James Peck held that “the  benefit of paying below market rent is not a “public assistance benefit”that is entitled to any exemption in bankruptcy.  It is a quirk of the regulatory scheme in the NewYork housing market, not an individual entitlement.”  The issue of whether rights in a residential rent stabilized lease is exempt is  currently on appeal in the United States Court of Appeals for the Second Circuit.   Stay tuned. ]]>