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07.22.24

NJ Judge Rules on Landlord Admin Claim in Bankruptcy Case

MS&B Partner, Andrea Dobin, recently represented a trustee in a bankruptcy case featured in The American Bankruptcy Institute daily roundup written by Bill Rochelle.

In her opinion, New Jersey Bankruptcy Judge Christine M. Gravelle, faced with an issue of first impression, determined to what extent a landlord was entitled to a Chapter 7 administrative claim when a Chapter 7 bankruptcy estate derives no value from a lease, but it is not rejected.

In this instance, the lease was not formally rejected by the Trustee, but stay relief was granted as to the contents very early in the case. Balancing the rights of the landlords against the rights of other creditors, Judge Gravelle’s opinion allowed an administrative claim (limited by equitable consideration) without a demonstration of value to the bankruptcy estates, stating that “landlords should not be saddled with additional post-position damages during a bankruptcy.”

Read more about this opinion in the ABI Daily Wire ▶️ https://bit.ly/3zi06x7