11 U.S.C. § 362

Section 362(a)(1) requires a judgment creditor with notice of the debtor’s bankruptcy to take affirmative action to dismiss or stay a prepetition garnishment.

Myers v. Miracle Finance, Inc. (In Re Myers) · filed 2009-03-09(a)(1)

In other words, dismissal of the garnishment is not the creditor’s only alternative for complying with the automatic stay. The creditor can satisfy its duty either by dismissing the garnishment or by staying it. ... Nevertheless, the judgment creditor, with notice of the bankruptcy, must take affirmative action with respect to the garnishment and not simply allow it to run its course.

Section 362(a) stays an existing wage garnishment when a bankruptcy case begins, making the garnished wages available to pay unsecured creditors.

In Re Ramlow · filed 2009-08-21(a)

Second, any wage garnishment in effect against a debtor is stayed upon the commencement of a bankruptcy case. 11 U.S.C. § 362(a). Consequently, while under the protection of the bankruptcy stay, funds garnished on a prepetition basis are again available to a debtor to pay his or her general body of unsecured creditors.

Section 362(k) treats a creditor’s and its attorney’s knowing failure to promptly release a prepetition wage garnishment and restore garnished wages as a willful stay violation.

Bailey v. Davant (In Re Bailey) · filed 2010-04-12(k)

Therefore, the court finds that, based on the pleadings in this case, Ms. Davant and her attorney had knowledge of the automatic stay and willfully violated the stay by failing to take timely and effective affirmative acts to release the garnishment on the Debtor’s wages, and to restore to the Debtor his garnished wages.

Section 362(a) requires a creditor to act to release an ongoing wage garnishment after learning that wages are still being garnished despite notice of the bankruptcy.

In Re Russell · filed 2010-11-18(a)

Based, therefore, upon this sequence of events it can only be concluded that Creditor’s counsel, by failing to take action after May 14 to release the garnishment, violated the automatic stay when Debtor’s wages were again garnished on May 28.

Section 362(a)(1) stays continuation of a wage-garnishment proceeding against a debtor upon the bankruptcy filing, including the operative effect of the garnishment return date under Virginia exemption law.

Harris v. Banks (In Re Banks) · filed 2011-01-25(a)(1)

However, the automatic stay of 11 U.S.C. § 362(a)(1) was imposed on November 24, 2010 when the Debtor filed her petition. The filing stayed the “continuation ... of a judicial ... action ... against the debtor ... to recover a claim against the debtor....” 11 U.S.C. § 362(a)(1) (West, 2010). On November 24, 2010, the operative effect of Va.Code § 34-17(B) was stayed.

The automatic stay covers a garnishment hearing held after the debtor files for bankruptcy when the garnishee can still surrender the debtor’s property and has not yet become personally liable.

Cadle Co. v. Henson · filed 2011-01-26(a)(3)

Such action still involved the debtor’s property and was an action against the bankruptcy estate in violation of the stay.

Section 362(a) stays a garnishment action against a debtor in its entirety, including pursuit of an independent claim against the garnishee for failure to answer or withhold property, unless an unmodifiable judgment established the garnishee’s liability before the bankruptcy filing.

Bank of America, N.A. v. Johnson (In re Johnson) · filed 2012-09-25(a)

The Court concludes that the automatic stay applies to prevent a garnishing creditor from continuing a garnishment action to pursue an independent claim against a garnishee, whether for failure to answer the garnishment summons or for failure to withhold funds or property of the debtor, unless an unmodifiable judgment in the garnishment action has established that independent liability at the time of the filing of the bankruptcy case.

Section 362(a)(1) requires a creditor with notice of bankruptcy to stop an ongoing wage garnishment; failing to do so willfully violates the automatic stay.

Yantis v. GLHS Unity Surgical Center (In re Yantis) · filed 2016-06-20(a)(1)

By not taking action to stop the garnishment upon notice of the bankruptcy, the defendant willfully violated the automatic stay.

Section 362(a)(6) requires a creditor who learns of a bankruptcy filing to halt a pending garnishment collecting a prepetition debt.

In re Banks · filed 2017-08-31(a)(6)

The Court concludes that Baumann willfully violated the automatic stay when he failed to halt the Second Garnishment after learning of the bankruptcy case.

Section 362(a)(3) bars a creditor from continuing to control garnished funds after a bankruptcy filing by refusing to release the garnishment.

Randi Michelle Nimitz · filed 2019-12-16(a)(3)

The Court concludes, therefore,that the Respondents have violated Section 362(a)(3) by continuing to exercise control over the garnished funds post-petition.

Section 362(a)(6) requires a garnishing creditor to act within a reasonable time to release a wage garnishment after learning of the bankruptcy; diligent efforts can satisfy that duty even if the employer takes two weeks to stop withholding wages.

Allen v. Capital One Bank (USA) · filed 2020-07-10(a)(6)

For a large corporation, Capital One’s efforts were more than adequately swift to avoid running afoul of the automatic stay. Any delay was caused by FedEx, not Capital One.

Section 362(a) does not require a creditor to dismiss a prepetition garnishment writ after promptly staying the proceedings and taking no action during the stay to obtain payment.

Stuart v. City of Scottsdale · filed 2023-08-07(a)(1)–(3), (6)

Scottsdale’s conduct — promptly requesting a stay of the pre-petition writ of garnishment proceedings but refusing to request or agree to dismissal of the writ — complied with the relevant automatic stay provisions.

Section 362(a)(1) stays pursuit of a garnishment order against a debtor after the debtor files a bankruptcy petition.

United States v. New-Tech Packaging · filed 2024-06-06(a)(1)

It follows that pursuit of such a garnishment order also constitutes “commencement or continuation…of a judicial…proceeding.” 11 U.S.C. § 362(a)(1).

Section 362(a) does not require a creditor that files a garnishment release to also call the garnishee to inform it of the release.

Renee Marie Gillespie · filed 2026-02-26(a)

The Court rejects Ms. Gillespie’s argument that RVO violated the bankruptcy stay by not contacting the garnishee defendant and informing them that the garnishment release was filed.

Section 362(a)(3) does not require a garnishee bank to release funds attached before bankruptcy without the creditor’s consent or a court order.

Linsenbach v. Wells Fargo Bank (In re Linsenbach) · filed 2012-11-05(a)(3)

Well Fargo’s refusal to release the garnishment without the consent of Capital One or a court order directing release of the funds was not a willful violation of the automatic stay.

Section 362(d) permits a bankruptcy court to modify the automatic stay through a court-approved stipulation that lifts the stay upon the debtor’s default.

Sellersville Savings & Loan Ass'n v. Kelly · filed 1983-05-20(d)

Under these circumstances, the bankruptcy court has properly exercised its authority to modify the automatic stay pursuant to 11 U.S.C. § 362(d) and the debtor has clearly waived any protection which would have been provided to him by the automatic stay.

The automatic stay may be modified to let a state forfeiture action proceed to judgment, and no further.

Sachs Ex Rel. Maryland v. Ryan (In Re Ryan) · filed 1983-08-22(a)

This Court has chosen the latter, but will attempt to delimit the role of the State Court to that of fact finder, by restrictively modifying the stay to permit the forfeiture case to proceed to judgment, and no further.

Section 362 permits modification of the automatic stay to allow lenders to record mortgages and other security instruments against the debtor’s property under an approved financing agreement.

In Re Simasko Production Co. · filed 1985-03-08

6. IT IS FURTHER ORDERED that the stay imposed under 11 U.S.C. § 362 is hereby modified to permit Metro National Bank and/or First Interstate Bank of Alaska to record the mortgage and other security instruments against property of the debtor in accordance with the terms of the Interim Financing Agreement.

A bankruptcy court’s modification of the automatic stay can allow an appeal against the debtor to proceed to conclusion, including after a prior remand.

Lee Ratner and John Zuro, Individually and D/B/A the Grant Company v. Sioux Natural Gas Corp. And Sioux Pipeline Corp. · filed 1985-09-12

On January 13, 1983, the bankruptcy court modified the automatic stay that 11 U.S.C. § 362 (1982) mandates to permit this appeal “to proceed to conclusion”. We think the order broad enough to authorize us to decide the case despite our previous remand. The lifting of the stay thus gives us jurisdiction over the case.

Section 362’s automatic stay continues to restrict relief beyond the scope of a bankruptcy court order modifying the stay.

Railroad Dynamics, Inc. v. A. Stucki Co. · filed 1986-04-30

Furthermore, the relief requested by Stucki exceeds the scope of the bankruptcy court’s order of August 9, 1984 modifying the automatic stay of 11 U.S.C. § 362. Stucki’s motion will therefore be denied.

Section 362’s automatic stay does not bar an IRS tax refund setoff when a general order modifies the stay to permit it.

In Re Dominguez · filed 1986-09-10

The IRS is not in violation of the automatic stay by reason of the Second Revised General Order No. 2.

Section 362’s automatic stay may be modified upon a creditor’s affidavit that an adequate-protection payment is more than thirty days overdue, as provided in the court’s order.

Sanders v. Cooper (In re Sanders) · filed 1987-04-05

In the event any payment is not made by the plaintiff within thirty (30) days of its due date in accordance with the adequate protection proposed by the plaintiff, there may be an automatic modification of the stay afforded by 11 U.S.C. § 362 upon the submission of an affidavit by the defendant stating such default.

Section 362 requires strict construction of an order modifying the automatic stay, so a stayed proceeding may continue only within the limits the bankruptcy court authorized.

Joseph E. Casperone, Francis A. Clark and Oklahoma Ltd., I v. Landmark Oil & Gas Corp., Larry B. Bach · filed 1987-06-15(d)

Because a section 362 stay freezes in place all proceedings against the debtor, and because only an order of the bankruptcy court can authorize any further progress in the stayed proceedings, it follows that the continuation of any proceeding can derive legitimacy only from the bankruptcy court order. The terms of an order modifying the automatic stay must therefore be strictly construed.

Section 362’s automatic stay may be modified by a bankruptcy court order permitting the IRS to offset a debtor’s tax refund against taxes owed.

Ferguson v. Internal Revenue Service (In Re Ferguson) · filed 1988-03-15

The Order acts to modify 11 U.S.C. § 362 to the extent outlined therein. Thus, no violation of the automatic stay occurred when the Internal Revenue Service offset the refund as against the taxes owed.

Section 362’s automatic stay may be modified to permit a petitioning creditor to enforce a judgment in state court against a debtor’s potential claim.

Paroline v. Doling · filed 1990-06-19

It is further ORDERED that the automatic stay of 11 U.S.C. § 362 is modified to permit the petitioning creditor to attempt to enforce his judgment in state court to reach any claim the debtor may have against any person or entity in connection with the petitioning creditor’s judgment against the debtor.

Section 362(d) requires a court order after notice to interested parties and a hearing to modify the automatic stay.

Andriani v. Czmus · filed 1992-01-09(d)

Suffice it to say here that the Stay Modification was never enforceable, because it was not ordered by Judge Mund after notice to interested parties and a hearing, as required by 11 USC § 362 (d), the provision of the Bankruptcy Code governing stay modification.

A debtor’s agreement to lift the automatic stay can constitute cause for relief from the stay under § 362(d)(1).

In Re McBride Estates, Ltd. · filed 1993-03-26(d)(1)

This court conducted a preliminary hearing on Barnett’s motion in accordance with the provisions of 11 U.S.C. § 362(e) at which time this court granted Barnett’s motion finding that the stipulation contained in the settlement agreement for the lifting of the automatic stay constituted sufficient cause under 11 U.S.C. § 362(d)(1) for the lifting of the automatic stay.

Section 362 permits the court to modify the automatic stay on its own initiative, if necessary to allow a creditor to draw on an expiring letter of credit after prevailing on the debtor’s injunction claim.

Barton Chemical Corp. v. Mobil Petrochemical Sales & Supply Corp. (In re Barton Chemical Corp.) · filed 1993-06-30

Since the Letter of Credit expires on the date of this order, it is appropriate that the Court act sua sponte to modify the statutory automatic stay under 11 U.S.C. § 362, if that be necessary to allow a draw today on the Letter of Credit. Otherwise, Mobil will lose its rights from expiration of the Letter despite prevailing here. Accordingly, the order provides for such limited stay modification.

Section 362’s automatic stay may be modified to permit a creditor to seek state-court injunctive relief for breaches of a covenant not to compete.

In Re Hughes · filed 1994-03-30

For the foregoing reasons, Movant’s motion is GRANTED, and it is therefore ORDERED that the automatic stay of § 362 is modified for the limited purpose of permitting Mendelson Electronics Company, Inc., to seek injunctive relief against Barry G. Hughes in state court.

Section 362 permits modification of the automatic stay to allow a mortgage lender to continue a pending state foreclosure action.

In Re Martin · filed 1995-01-05

3. The stay afforded by 11 U.S.C. § 362, be, and hereby is, modified to permit the movant to continue its pending action in the Superior Court, Judicial District of Hartford/New Britain at Hartford, to foreclose its mortgage upon the property known as 115 Longview Drive, Windsor, Connecticut.

The automatic stay under § 362(a) may be modified to allow arbitration of claims involving the debtor.

In Re CGE FORD HEIGHTS, L.L.C. CGE FORD HEIGHTS, L.L.C. v. BROWNING-FERRIS INDUSTRIES OF ILLINOIS, INC. · filed 1997-05-12(a)

To the extent necessary, the automatic stay of 11 U.S.C. § 362(a) is modified to allow this arbitration process.

Section 362’s automatic stay may be modified to permit creditors to pursue their claims against the debtor.

Babitt v. Vebeliunas (In Re Vebeliunas) · filed 2000-04-21

The automatic stay of 11 U.S.C. § 362 is modified to permit Chase Manhattan Bank and Citibank, N.A., to pursue their claims against the debtor.

Section 362(d)(1) permits a court to modify the automatic stay to allow related state court litigation to proceed, subject to conditions that aid a later dischargeability determination.

In Re Fearn · filed 2003-06-17(d)(1)

Based upon the foregoing, the Motion of Shannon Huffer and Gregory Huffer for Modification of Automatic Stay to Permit Prosecution of Action in State Court is hereby granted subject to the special jury instruction(s)/verdict form(s) being submitted as described herein and subject to a joint report being filed in Adversary Proceeding No. 03-2085.

Section 362 permits modification of the automatic stay so creditors may proceed against the debtor concerning assets outside the bankruptcy estate.

Clean Cut Tree Service, Inc. v. Costello (In Re Costello) · filed 2003-10-03

Wherefore, judgment will separately enter against Defendant, and the automatic stay under 11 U.S.C. § 362 will be modified so all creditors may proceed against the Debtor/Defendant to permit assets not part of the bankruptcy estate.

A limited modification of the automatic stay permitting confirmation of an arbitration award, but not enforcement, allows entry of a judgment containing the award’s injunctive relief.

Econergy v. Deol CA6 · filed 2022-02-10(a)

On this record, we are not persuaded by Deol’s attempt to recast the injunctive relief contained in the final arbitration award, the order confirming the award, and the judgment as improper “enforcement of the arbitration award.”

Section 362 allows the bankruptcy court to lift the automatic stay for an appeal, after which the appellate court may decide it.

Ostrowski v. Lake County, Indiana · filed 2022-05-11

The responsible bankruptcy court may modify the automatic stay upon request. Here, the bankruptcy court granted Ostrowski’s request to lift the automatic stay for his fee appeal, and so we are free to resolve it now.

Section 362 permits a bankruptcy court to modify the automatic stay sua sponte to allow a creditor to seek sanctions in the court whose orders the debtor violated.

Campbell · filed 2026-01-12

To facilitate the Alabama District Court’s determination of appropriate sanctions, this Court will modify the automatic stay sua sponte to permit Radiance Capital to continue prosecution of the Sanctions Motion or otherwise seek sanctions for the Debtor’s violations of the Charging Orders in the Alabama Action.

Section 362(a)'s stay may be modified to permit a secured creditor to enforce its security interest in property as to which the debtor concedes the creditor's motion.

In Re Faughn · filed 1986-09-05(a)

The stay of lien enforcement provided by 11 U.S.C. § 362(a) is modified to permit Anderson’s to enforce its security interest in Debtor’s ... in accordance with its security agreement with Debtor and the laws of the State of Missouri.

The automatic stay under § 362(a)(5) may be conditioned to permit a creditor to sell collateral while giving the debtor an opportunity to redeem it before the sale.

Catholic Credit Union v. Siegler (In Re Siegler) · filed 1980-02-29(a)(5)

However, if the property is not redeemed immediately at the value now determined, the court has also determined to continue the stay under 11 U.S.C. § 105(a) which was originally provided by 11 U.S.C. § 362(a)(5), but to modify and condition such stay, and to permit future redemption before a final sale by using a procedure similar to that provided by 11 U.S.C. § 363(i) for co-owners of property being sold by a trustee.

The automatic stay prevents a debtor’s contract counterparty from taking action to terminate the agreement after a notice period expires during the bankruptcy case.

C.O.P. Coal Development Co. v. C.W. Mining Co. · filed 2011-04-19

By then, of course, COP could not take action to terminate because it was foreclosed from doing so under the automatic stay in 11 U.S.C. § 362.

Section 362 does not toll a contract termination period when only the passage of time remains after notice of termination.

Moody v. Amoco Oil Co. (In Re Moody) · filed 1983-06-02

The court found no authority for the debtor in possession to extend that time, nor was the time tolled by 11 U.S.C. § 362. ... In the present case, as in Beck, nothing remains to be done concerning the dealership termination. The fact that the 90 days had not passed as of the date of filing does not make the dealership contracts subject to extension beyond the 90-day period.

Section 362(a) does not toll the period for curing a default under a promissory note secured by a deed of trust.

Steele v. Pridham (In Re Pridham) · filed 1983-07-14(a)

Therefore, this court holds that the time period specified in which a party has to cure a default under a promissory note that is secured by a deed of trust is not tolled by the automatic stay of Section 362(a).

Section 362(a) does not toll a debtor’s state-law redemption period when the purchaser obtains title through the passage of time without taking a further act or proceeding.

In Re Petersen · filed 1984-05-10(a)

Section 362 stays only “acts” or “proceedings” of non-debtors. What the debtor needs to do to reacquire the property is irrelevant to this analysis. Under Oregon’s redemption procedure it is clear the purchaser need only wait for the fullness of time to be blessed with fee title.

Section 362(a) does not toll or extend a state statutory redemption period following a foreclosure sale.

Federal Land Bank v. Glenn · filed 1985-04-16(a)

We also hold that the automatic stay provisions of 11 U.S.C. § 362(a) do not toll or extend the running of state statutory periods of redemption following foreclosure sales.

Section 362(a) does not toll the deadline to exercise a contractual lease renewal option.

In Re Crabb · filed 1985-04-03(a)

The automatic stay provisions of § 362 have no effect on the running of the option. This section applies to judicial and quasi-judicial proceedings to “recover a claim against the debtor” or enforce a pre-petition “judgment against the debtor” or similar acts. Section 362 does not stop the clock on the provisions of contractual agreements.

Section 362(a)(3) does not stay a contracting party’s declaration of default and substitution of a surety when those actions do not seek possession or control of the debtor’s property.

Solar Construction Co. v. Department of General Services · filed 1987-05-04(a)(3)

Our reading of Section 362(a)(3) convinces us that it is inapplicable to Solars circumstances. Section 362(a)(3) grants an automatic stay of proceedings of “any act to obtain possession of property of the [bankrupts] estate or of property from the estate or to exercise control over property of the estate.” In the instant case, the Department did. not seek to possess or exert control over any property of Solar. The Department simply terminated, a contractual relationship with Solar due to Solars default in the performance of that contract. The Department .declared Solar in default and substituted its surety for it in order to complete the contract. We - conclude that Section 362(a)(3) is inapplicable to the case at bar.

Section 362(a) does not toll a statutory redemption period beyond the extension provided by § 108(b).

In Re Farmer · filed 1988-01-28(a)

The drafters of the Code specifieally outlined redemption periods in § 108. They just as specifically excluded them from the scope of the automatic stay by failing to refer to them in that section.

Section 362 makes a postpetition attempt to terminate a debtor’s license agreement ineffective.

In Re Specialty Foods of Pittsburgh, Inc. · filed 1988-09-16

The attempted termination was ineffective because of the automatic stay imposed by 11 U.S.C. § 362.

Section 362(a) does not toll a contractual deadline or prevent a contract from expiring automatically under its terms, including a subordination agreement between creditors.

Hazen First State Bank v. Phillip Speight, Small Business Administration · filed 1989-11-01(a)

The automatic stay provided for by section 362(a) does not enlarge the rights of individuals under a contract nor does it toll the running of time under a contract. It will not prevent the automatic termination of a contract by its own terms.

Section 362(a)(3) stays a franchisor’s postpetition attempt to terminate agreements that are property of the bankruptcy estate, and a termination attempted in violation of the stay has no legal effect.

In Re Deppe · filed 1990-02-21(a)(3)

Amoco’s attempt to terminate the agreements via its district manager’s December 20, 1989 letter to Deppe was an act to exercise control over property of the bankruptcy estate. Regardless of whether Amoco had actual notice of the filing, the purported termination was undertaken in violation of the automatic stay. As such, it was void, or at least voidable.

Section 362 does not prevent a contract from ending under its own cancellation terms or give the debtor greater contractual rights than it had outside bankruptcy.

Valley Forge Plaza Associates v. Schwartz · filed 1990-03-12(a)

Furthermore, I find that the termination did not violate the automatic stay. A debtor in bankruptcy has no greater rights or powers under a contract than the debtor would have outside of bankruptcy.

The automatic stay does not toll the running of a land contract forfeiture redemption period.

Matter of Delex Management · filed 1993-06-02(a)

The automatic stay does not toll the running of the land contract forfeiture redemption period.

The automatic stay tolls the limitation period for an issue presented to the bankruptcy court while that court considers it.

Pleasant Excavating Co. v. Fairfax County Board of Supervisors · filed 1994-06-08

As a result, the filing of the petition in Bankruptcy Court stayed all other proceedings. 11 U.S.C. § 362. This Court can only conclude that the stay also tolls the limitation period for any issue that is presented to the Bankruptcy Court.

Section 362(a)(3) bars termination of a debtor’s contract after a bankruptcy filing, even when state law permits termination at will, unless the terminating party obtains relief from the stay.

Elder-Beerman Stores Corp. v. Thomasville Furniture Indus. Inc. (In Re Elder-Beerman Stores Corp.) · filed 1996-05-03(a)(3)

Thus while parties may otherwise be permitted to terminate an agreement under state contract law, in bankruptcy such a termination would be in violation of the stay, and the parties must seek permission of the court to act.

Section 362(a) does not toll the statutory redemption period provided by California Civil Code § 2983.2.

Osijo v. Cosmopolitan Finance Co. · filed 2001-10-24(a)

The BAP did not err because the automatic stay did not toll the statutory redemption period provided by Cal. Civ.Code § 2983.2, see Napue v. Gor-Mey West, Inc., 175 Cal.App.3d 608, 220 Cal.Rptr. 799, 817 (Cal.Ct.App.1985), and Osijo failed to raise his remaining statutory notice arguments before the bankruptcy court, see Everett v. Perez (In re Perez), 30 F.3d 1209, 1213-14 & n. 4 (9th Cir.1994).

Section 362(a) does not prevent an agreement from terminating by its own terms during bankruptcy when its termination conditions are met.

In Re Clearpoint Business Resources, Inc. · filed 2010-12-30(a)

The Court has now found that the Agreements terminated by their terms during the course of the Debtors’ bankruptcy. StaffChex did not, therefore, violate the automatic stay.

Section 362(a) bars a contracting officer from commencing administrative proceedings against a debtor, including terminating a government contract for default without bankruptcy court permission.

U.S. Coating Specialties & Supplies, LLC · filed 2017-04-06(a)

U.S. Coating's bankruptcy filing imposed an automatic stay pursuant to 11 U.S.C. § 362(a), prohibiting the CO from commencing administrative actions or proceedings against U.S. Coating. Martel Truck & Tractor Serv., Inc., ENG BCA No. 6191, 96-2 BCA ~ 28,368 at 141,649. Therefore, the Corps could not terminate the contract for default absent permission from the Bankruptcy Court.

Section 362(a) bars a franchisor from sending a PMPA termination or nonrenewal notice after the franchisee files for bankruptcy unless the franchisor first obtains relief from the bankruptcy court.

Rogue Valley Stations, Inc. v. Birk Oil Co. · filed 1983-07-15(a)

In fact, the automatic stay prevents a franchisor from sending a PMPA notice of termination or nonrenewal without first securing appropriate relief from stay from the Bankruptcy Court.

Section 362(a)(3) stays unilateral termination of a debtor’s contract after a bankruptcy petition, even if the other party has grounds to terminate; that party must seek relief from the stay under § 362(d).

In Re Computer Communications, Inc., Debtor. Computer Communications, Inc. v. Codex Corporation · filed 1987-08-07(a)(3)

The courts below held that the automatic stay prohibited Codex from unilaterally terminating the Agreement. We agree. Even if Codex had a valid reason for terminating the Agreement, it still was required to petition the court for relief from the automatic stay under § 362(d).

Section 362(a)(3) prevents a franchisor from terminating a debtor’s franchise agreement after a bankruptcy petition is filed unless the automatic stay is lifted.

Ramada Franchise Systems, Inc. v. Bhagat · filed 1993-10-14(a)(3)

The bankruptcy petition of course invoked the automatic stay provision, which prevented Ramada from proceeding as planned to terminate the franchise in December. 11 U.S.C. § 362(a)(3). Without lifting the automatic stay, which it did not attempt, Ramada could not have taken any post-petition action to terminate the agreement, and in fact did not take any such action until its letter of September 30, 1987.

Section 362 does not stay proceedings concerning a franchise agreement that terminated before the bankruptcy filing, because the agreement is not an asset of the bankruptcy estate.

J.P.T. Automotive, Inc. v. Toyota Motor Sales, U.S.A., Inc. · filed 2009-09-14

Since Victory’s franchise agreement no longer existed at the time Victory instituted this action, and had not done so for more than one month prior to its bankruptcy filing, it cannot be considered an asset of the bankruptcy estate, subject to the provisions of the automatic stay. As a result, Victory’s request to stay this action, pursuant to the automatic bankruptcy stay, should be denied.

Section 362(a) does not stay a materialman’s preliminary notices or actions against contractors’ payment bonds because the bonds are not property of the debtor’s estate.

In Re Jay Forni, Inc. · filed 1983-08-03(a)

FOSTER's preliminary notices of claim dated June 7, 1982, four (4) days after the debtor filed its Chapter 11 petition, and any other activities to pursue its right of action against the contractors' payment bonds are not stayed by 11 U.S.C. § 362(a). The bonds are not property of the debtor's estate and actions against sureties are not stayed in Chapter 11 proceedings.

Section 362(a)(1) does not automatically stay a supplier’s Miller Act payment bond action against the bankrupt contractor’s surety.

United States Ex Rel. Central Building Supply, Inc. v. William F. Wilke, Inc. · filed 1988-05-23(a)(1)

Because this Court similarly feels that to grant (or maybe more accurately to enforce) a § 362(a)(1) stay in favor of the surety herein “would flout the purpose of the Miller Act,” it therefore declines to grant a stay under that statute.

Section 362(a) does not stay a utility’s demand for security to provide adequate assurance of payment under § 366(b).

Marion Steel Co. v. Ohio Edison Co. (In Re Marion Steel Co.) · filed 1983-10-17(a)

Furthermore, such a demand for security authorized by § 366(b) does not violate the automatic stay provisions of 11 U.S.C. § 362(a).

Section 362’s automatic stay does not bar a utility from discontinuing service when the utility complies with § 366.

Lloyd v. Champaign Telephone Co. (In Re Lloyd) · filed 1985-08-26

Nevertheless, because 11 U.S.C. § 366 specifically addresses the relationship between debtors and utility companies, compliance with § 366 will generally excuse an action which, absent § 366, might otherwise constitute a violation of the automatic stay under the extremely broad provisions of § 362.

Section 362(a)(6) does not bar a utility from demanding restitution for meter tampering and unauthorized gas use as a condition of restoring service after a bankruptcy petition.

Hendrickson v. Philadelphia Gas Works · filed 1987-10-06(a)(6)

Plaintiff now claims that PGW violated her rights under the Bankruptcy Act, 11 U.S.C. §§ 362, 366, by refusing to restore service unless she paid these pre-petition charges. The claim must be denied because the charges were unrelated to the commencement of the bankruptcy action or collection of a debt related to services rendered by the utility. The charges were based on meter tampering and unauthorized usage.

Section 362 does not prohibit a utility from requesting a security deposit to secure payment for post-petition services.

Linnea Dawn Martinez · filed 2026-03-12(a)(6)

CFU’s request for a security deposit to secure post-petition services—which occurred 47 days after the petition was filed— did not violate the automatic stay.

Section 362(a)(2) stays enforcement against a debtor or estate property of a prepetition judgment, including a judgment ordering specific performance.

AMP v. Commonwealth of Puerto Rico · filed 2019-09-25(a)(2)

The plain meaning of § 362 covers this prepetition Commonwealth court judgment against the debtors and their property for specific performance of the municipal projects.

Section 362(b)(5) permits enforcement of a judgment requiring correction of housing violations because it is not a money judgment.

Matter of Kennise Diversified Corp. · filed 1983-10-21(b)(5)

This court is of the view that an Article 7A judgment is not a money judgment since it seeks to enforce the landlord’s continuing obligation to comply with the housing laws with respect to provision of essential services. Therefore its enforcement is permitted under Bankruptcy Code § 362(b)(5).

Section 362(a)(2) bars postpetition wage garnishment to enforce a judgment obtained before the bankruptcy filing.

Matter of Rutty · filed 1984-05-14(a)(2)

The wages garnished after the filing of the.bankruptcy petition on March 14, 1983, clearly violated the provisions of the automatic stay. Section 362(a)(2) stays “the enforcement, against the debtor or against property of the estate, of a judgment obtained before the commencement of the case under this title.” 11 U.S.C. § 362(a) (1983).

Section 362(a)(2) prohibits execution on a prepetition judgment after the debtor files for bankruptcy; violating the stay can subject the creditor to contempt.

Administration Service Co. v. Stallings · filed 1985-04-10(a)(2)

Execution on the judgment after the filing of the bankruptcy petition would not only have been futile, it would also have been a violation of the automatic stay, thereby rendering plaintiff in contempt of the bankruptcy court.

Section 362(a) stays contempt proceedings that coerce payment of a judgment from a debtor’s bankruptcy estate, including enforcement of a contempt order entered before the bankruptcy petition.

In Re Marriage of Lueck · filed 1986-02-05(a)

Where the contempt is invoked as a sanction for failure to pay a judgment or to compel the expenditure of money from a bankrupt’s estate, the proceedings are not exempt from the automatic stay of section 362(a). ... The court’s contempt proceedings, therefore, were not exempt from the automatic stay provisions of section 362(a) and defendant’s motion should have been granted.

Section 362(a)(2) stays a creditor from taking further action to enforce a prepetition foreclosure judgment when a foreclosure sale has not occurred.

Jackson v. Citicorp Mortgage, Inc. (In Re Coleman) · filed 1988-01-27(a)(2)

Having determined that the debtor may redeem the property and recognizing that the creditor cannot get possession of the property until after the sale, it is clear that 11 U.S.C. § 362(a)(2) specifically prohibits the creditor from “the enforcement, against the debtor or against property of the estate, of a judgment obtained before the commencement of the case under this title.” Since the creditor must take some further action of a discretionary nature and since it is clear that the creditor has a period of up to twenty years within which to take such action, there can be no doubt but that § 362 applies.

Section 362(b)(5) allows enforcement of an attachment supporting an equitable environmental remedy because that attachment is not a money judgment subject to the automatic stay.

Friends of the Sakonnet v. Dutra · filed 1991-01-30(b)(5)

The order of attachment is in support of a purely equitable decree. As in Penn Terra, defendants do not fall within the money judgment exception. The actions of this Court, therefore, are not in any way affected by the automatic stay provisions of 11 U.S.C. § 362(a).

Section 362(a)(2) stays enforcement of a judgment against property of the bankruptcy estate.

In Re Ardas Yanik, Debtor. Julian Ayrs v. Chapter 7 Trustee · filed 1993-09-29(a)(2)

Pursuant to section 362(a)(2), the automatic stay is applicable to the enforcement of a judgment against property belonging to Yanik's estate.

Section 362(a)(2) stays enforcement of a prepetition judgment against a debtor when the debtor files a bankruptcy petition.

In Re Atkins · filed 1999-01-21(a)(2)

The automatic stay was in effect as of October 8, 1998, the date Debtors filed their bankruptcy petition. The stay prevents WPHA from enforcing the judgment against Debtors.

Section 362(a)(2) stays enforcement of a prepetition foreclosure judgment through an execution of ejectment.

Federal National Mortgage Ass'n v. Fitzgerald (In Re Fitzgerald) · filed 1999-08-09(a)(2)

FNMA acted in furtherance of the prepetition Foreclosure Judgment in obtaining the Execution of Ejectment. Thus, enforcement of the Execution of Ejectment qualifies as a proscribed act under Section 362(a)(2).

Section 362(a)(2) stays a judicial officer’s execution of a writ of restitution based on a prepetition judgment against the debtor.

Davis v. Conrad Family Ltd. Partnership (In Re Davis) · filed 1999-11-30(a)(2)

Upon examining this statutory framework, it is clear that under Ohio law a judicial officer who executes a writ of restitution, pursuant to a prepetition judgment, is enforcing a judgment against the debtor for purposes of § 362(a)(2), and thus is in violation of automatic stay.

Section 362(a)(2) prevents a creditor from executing on a prepetition judgment while the automatic stay is in effect.

Smith v. Lachter (In Re Smith) · filed 2003-04-23(a)(2)

The Lachters were prevented from executing on the state court judgment during the pendency of the § 362 automatic stay.

Section 362(a)(2) bars commencing a supplementary proceeding to enforce a prepetition judgment while the automatic stay remains effective, including before a dismissal order is entered on the docket.

In Re Weitzman · filed 2008-02-07(a)(2)

The prepetition judgment subject to the stay cannot, therefore, validly support the commencement of a supplemental proceeding. ... The Casino does not recognize, however, that dismissal of this case was not effective until the order of dismissal was entered on the docket on February 24, 2006. ... The Citation was issued when the stay was still in effect and the Judgment was unenforceable.

Section 362(a)(2) does not stay enforcement of a right arising by operation of law merely because a prepetition judgment recognized that right.

In re Coupel · filed 2016-08-26(a)(2)

Instead, the July 20th pre-bankruptcy judgment merely recognized a right vested in Kfoury’s property by operation of law, the enforcement of which the Court finds is not covered by the automatic stay under Section 362(a)(2).

Section 362(k) does not award additional damages merely because a creditor fails to pay an existing money judgment for a stay violation; the debtor must pursue judgment collection remedies.

In re Snorden · filed 2016-11-01(k)

In its bench opinion, the court emphasized that the Damages Order constitutes a “judgment” under Fed. R. Bankr. P. 7054 that liquidated the Debtor’s claims under section 362(k). ... The court further explained that because the Debtor has a money judgment, her recourse lies in the collection remedies under applicable non-bankruptcy law.

Section 362(a)(2) stays enforcement of a judgment obtained before bankruptcy, legally barring collection while the stay is in place.

Baker Atlas, Res/cross-app. v. Prince Cheruvathur, App/cross-res. · filed 2019-05-20(a)(2)

Rather, the bankruptcy code created a stay against enforcement of any judgment obtained against Cheruvathur before he filed for bankruptcy.

Section 362(a)(2) stays enforcement against the debtor or estate property of a prepetition state court order requiring the debtor to cease operations.

S-Tek 1, LLC · filed 2020-12-11(a)(2)

Enforcement of the State Court Order is subject to the automatic stay. Bankruptcy Code § 362(a)(2) provides that with exceptions not applicable here, the commencement of a bankruptcy case “operates as a stay, applicable to all entities, of . . . the enforcement, against the debtor or against property of the estate, of a judgment obtained before the commencement of the case under this title.” The State Court Order falls within this provision. It was entered before the commencement of the bankruptcy case, and enforcement of the State Court Order would be against Debtor and would affect property of the bankruptcy estate.

Section 362(a)(2) stays postpetition requests to enforce a prepetition foreclosure or eviction judgment against the debtor, including a request for a writ of assistance to obtain possession.

Natache D Rinegard-Guirma · filed 2023-08-04(a)(2)

If the bank were to request postpetition issuance or execution of a writ of assistance to enforce its right to possess the property, the request would constitute enforcement against Guirma of its foreclosure judgment. And if the bank were to request enforcement of its prepetition eviction judgment, the request would constitute enforcement against her of the eviction judgment. Both requests would violate 362(a)(2).

Section 362(a)(2) bars enforcement of a prepetition state court eviction judgment against a debtor after the bankruptcy petition is filed.

Scroggins · filed 2026-04-01(a)(2)

Mr. Landry’s eviction, pursuant to a state court order is the definition of “the enforcement, against the debtor or against property of the estate, of a judgment obtained before the commencement of the case under this title.” 11 U.S.C. 362(a)(2).

Section 362(a)(3) prevents a creditor from levying on estate property to collect a postpetition money judgment without relief from the automatic stay.

Kir Temecula, L.P. v. LPM Corp. (In Re LPM Corp.) · filed 2001-07-27(a)(3)

We agree with the bankruptcy court that the automatic stay applied here, and by failing to request appropriate relief from the stay, Kir Temecula was not entitled to proceed against the Account.

A reaffirmation solicitation without coercion or harassment does not violate the automatic stay and cannot support damages under § 362(k)(1).

Kyra Ann Zemlansky · filed 2020-12-14(k)(1)

Absent coercion or harassment, a creditor’s solicitation of a reaffirmation agreement does not run afoul of the automatic stay.

Section 362(a)(6) does not automatically bar a creditor from conditioning reaffirmation of secured debt on reaffirmation of separate unsecured debt, but it prohibits coercive or harassing reaffirmation negotiations.

Jamo v. Katahdin Federal Credit Union · filed 2002-03-26(a)(6)

Based on the foregoing analysis, we reject the proposition that a creditor's decision to withhold reaffirmation of a secured debt unless the debtor agrees to reaffirm other, unsecured debts amounts to a per se violation of the automatic stay.

Section 362 does not bar a creditor from offering to reaffirm a debt when the offer involves no coercion or harassment of the debtor.

Cox, Ralph M. v. Zale Delaware Inc · filed 2001-02-08(a)(6)

Provided there is no coercion or harassment of the debtor, the creditor’s offer of reaffirmation is not deemed an attempt to collect the debt and therefore does not violate the automatic stay, the statutory injunction against creditors’ seeking to collect their debts from a debtor after he’s entered bankruptcy.

Section 362(a)(6) does not prohibit solicitation of a reaffirmation agreement, even if the agreement is never filed, absent additional coercive conduct by the creditor.

Wiley v. Mason (In Re Wiley) · filed 1998-08-28(a)(6)

Solicitation of a reaffirmation agreement, whether subsequently filed or unfiled, is not a violation of the automatic stay without any additional coercive behavior on the part of the creditor.

Section 362 bars creditor harassment after a bankruptcy filing but permits a creditor to visit the debtor to inspect collateral and negotiate reaffirmation terms when the debtor initiated those negotiations.

General Auto Sales v. Ferguson (In re Ferguson) · filed 1983-10-24

It is unquestioned that the creditor is precluded from harassing or threatening activities pursuant to 11 U.S.C. § 362 after the filing of a petition for relief. However, where, as here, the contact was initiated by the debtor seeking to negotiate a reaffirmation agreement, the creditor, in reliance upon the debtor’s stated intended purpose, may visit the debtor for the purpose of viewing the collateral and negotiating the requisite terms.

Section 362(a)(6) does not prohibit a creditor from refusing to reaffirm one debt unless the debtor also reaffirms another, without more.

Schmidt v. American Fletcher National Bank & Trust Co. (In Re Schmidt) · filed 1986-08-06(a)(6)

Where a creditor refuses to consent to the reaffirmation of one debt without the reaffirmation of another, without more, no violation of the automatic stay has occurred.

Section 362(a)(6) permits a creditor to send a noncoercive reaffirmation offer to the debtor’s attorney, with a copy to the debtor.

Jefferson v. G. Fox (In Re Jefferson) · filed 1992-09-14(a)(6)

On today’s facts, however, we rule that the Defendant did not violate § 362(a)(6) by mailing the subject letter to Mr. Prescott, with a copy to the Debtor, soliciting the reaffirmation of a dischargeable debt.

Section 362(a)(6) permits a creditor to propose reaffirmation terms when the communication does not threaten or coerce the debtor to the point of harassment.

Sears v. Epperson (In Re Epperson) · filed 1995-10-06(a)(6)

The copy of the Letter sent by Sears to Lisa Epperson is not an action to collect a debt as that phrase is contemplated by the Bankruptcy Code. The Letter was not threatening or coercive to the point of harassment, and thus does not violate the automatic stay under section 362(a)(6).

Section 362(a)(6) permits a nonthreatening, noncoercive offer to reaffirm a prepetition debt, even when the creditor copies a represented debtor on a letter to counsel.

In the Matter of William Duke, Debtor-Appellant · filed 1996-03-15(a)(6)

Nothing in either § 362 or § 524 distinguishes between sending a letter to a debtor’s attorney without any “cc,” and sending a copy of the letter along to the debtor directly. ... We conclude that the letter Sears sent to Duke did not violate the automatic stay provisions of § 362, nor does the Bankruptcy Code require as a matter of law that the creditor refrain from copying the debtor on correspondence to the debtor’s attorney.

Soliciting a reaffirmation agreement does not violate the automatic stay unless the agreement is threatening or coercive, even if the agreement fails to satisfy the Bankruptcy Code’s requirements.

Holcomb v. Norwest Financial, Inc. (In Re Holcomb) · filed 1999-06-08(a)(3)

Even where a reaffirmation does not conform to the Code’s requirements, the act of solicitation does not violate the automatic stay as long as the agreement is not itself threatening or coercive.

Section 362(a)(6) does not prohibit a mere request to reaffirm prepetition debt absent coercive or harassing conduct.

Bessette v. Avco Financial Services, Inc. · filed 1999-10-19(a)(6)

A mere request to reaffirm the debt, absent additional facts, does not constitute coercive or harassing conduct.

Section 362 bars postpetition creditor contacts seeking reaffirmation when they involve coercion or harassment.

Friendly Finance v. Tucker · filed 2000-07-07

§ 362 has generally been construed to bar post-petition contacts by creditors with an eye toward reaffirmation only when they involve “coercion or harassment.” ... We therefore affirm the finding that Friendly violated § 362.

Section 362 permits a creditor to ask a debtor to sign a reaffirmation agreement while the automatic stay is in effect, absent harassment or coercion.

Bassett v. American General Finance, Inc. (In Re Bassett) · filed 2000-11-17

A creditor does not, absent some sort of harassment or coercion, violate the automatic stay by asking debtor to sign a reaffirmation agreement.

Section 362(a)(6) bars a creditor from conditioning reaffirmation of a home mortgage on reaffirmation of unrelated unsecured debts while threatening foreclosure if the debtor refuses.

Katahdin Federal Credit Union v. Jamo (In Re Jamo) · filed 2001-05-29(a)(6)

We hold that the action of KFCU conditioning reaffirmation of a residential mortgage loan upon reaffirmation of other unsecured obligations, and representing that, should the reaffirmation package not be approved, it would foreclose on Debtors’ home, is both threatening and coercive and a violation of the automatic stay.

Section 362(a) does not prohibit a creditor from conditioning reaffirmation of a secured debt on reaffirmation of an unrelated unsecured debt absent additional coercive or harassing conduct.

Jacobs v. Honda Federal Credit Union (In Re Jacobs) · filed 2004-12-02(a)

Putting things together then, the Court cannot find that, as a matter of law, a creditor conditioning reaffirmation of one claim to another violates the automatic stay of § 362(a). ... Therefore, as no other evidence exists in this case that the Defendant acted in a coercive or otherwise harassing nature against the Debtors, the Defendant’s act of conditioning the reaffirmation of its secured claim on the reaffirmation of its unrelated unsecured claim does not result in a stay violation.

A creditor’s conduct during reaffirmation violates § 362(a) only if it can reasonably be expected to significantly affect the debtor’s repayment decision and is unfair under the circumstances.

In re Freeman · filed 2005-06-01(a)

And in direct recognition of this, the Court in Pertuso held that acts taken during the reaffirmation process may still constitute a stay violation if such acts, (1) could reasonably be expected to have a significant impact on the debtor’s determination as to whether to repay, and (2) are contrary to what a reasonable person would consider to be fair under the circumstances. ... Therefore, in conclusion, since both parts of the Pertuso test must be met before a creditor’s actions during the reaffirmation process may be deemed to have resulted in a § 362(a) stay violation, and since the second part of this test has not been established in this matter, the Debtors’ action to have the Creditor return those funds paid on their auto debt postpe-tition cannot be sustained.

Section 362(a)(6) does not prohibit a creditor from giving basic information about voluntary repayment in response to a debtor’s question when the response does not coerce repayment.

Messick v. Ascend Federal Credit Union · filed 2010-01-29(a)(6)

The Court also agrees with the bankruptcy court’s conclusion that debtor-initiated contact that revealed basic information about reaffirmation, in response to the debtor’s question, does not support a violation of the automatic stay.

Section 362(a)(3) does not bar a private party from filing a competing FCC license application while a debtor seeks to renew its license.

D.H. Overmyer Telecasting Co. v. Lake Erie Communications, Inc. (In Re D.H. Overmyer Telecasting Co.) · filed 1983-11-30(a)(3)

If the FCC can take away Telecasting’s license, private parties should be permitted to apply to the FCC to become the new licensee, without violating the stay.

Section 362(a)(3) and (a)(6) do not prohibit a creditor from temporarily withholding a contract payment while awaiting the bankruptcy court’s ruling on a nonfrivolous recoupment defense.

Alpine Summit Energy Partners, Inc. and Official Committee of Unsecured Creditors · filed 2024-04-24(a)(3), (a)(6)

Because ARM merely awaited this Court’s order, even after the Early Termination Date came and passed, its actions were not in violation of the stay.

Section 362(b)(4) permits HHS to recoup Medicare overpayments from a provider’s postpetition reimbursements without violating the automatic stay.

In Re the Southern Institute for Treatment & Evaluation, Inc. · filed 1998-01-06(b)(4)

The Court also finds that HHS has not violated the automatic stay provision of 11 U.S.C. § 362 by recouping 100% of the Debt- or’s post-petition claims; exemption under 11 U.S.C. § 362(b)(4) applies to acts of recoupment by HHS.

Section 362(b)(4) exempts the Secretary’s recoupment of Medicare overpayments under the Medicare payment scheme from the automatic stay.

Visiting Nurse Ass'n of Tampa Bay v. Sullivan (In Re Visiting Nurse Ass'n of Tampa Bay) · filed 1990-10-30(b)(4)

Exemption under Title 11 U.S.C. § 362(b)(4) does apply to acts of recoupment by the Secretary.

Section 362’s automatic stay does not prohibit recoupment of an overpayment from amounts due under the same transaction.

United States v. Midwest Service & Supply Co. (In Re Midwest Service & Supply Co.) · filed 1983-12-15(a)

The court concludes that this involved a recoupment rather than a setoff. The significance of this finding is that a recoupment is not prohibited by the automatic stay.

Section 362’s automatic stay bars the Social Security Administration from recouping prepetition overpayments from benefits payable after a bankruptcy petition is filed.

Lee v. Schweiker · filed 1984-06-29

Once a bankruptcy petition is filed, the income provided by Social Security benefits should be protected by the automatic stay. ... Accordingly, we hold that SSA may not recoup previous overpayments from benefits payable after a bankruptcy petition is filed.

Section 362 requires a creditor to obtain relief from the automatic stay before exercising recoupment against the debtor.

Burley v. American Gas & Oil Investors (In Re Heafitz) · filed 1988-02-11(a)(6)

Instead, we hold that a party seeking to exercise a proper recoupment must first seek relief from the automatic stay, 11 U.S.C. § 362.

Section 362(a)(1) does not stay recoupment of pre-petition unemployment benefit overpayments from post-petition benefits when both claims arise from the same transaction.

Ross v. Missouri Division of Employment Security (In Re Ross) · filed 1989-03-15(a)(1)

Here, MDES used recoupment of Ross’ pre-petition overpayment as a defense to Ross’ post-petition claim for benefits. Accordingly, the Bankruptcy Court erred in treating MDES’ action as a set-off and therefore a violation of the automatic stay provisions.

Section 362(a) does not stay a creditor’s recoupment of overpayments from ongoing payments arising under the same contract.

Long Term Disability Plan of Hoffman-La Roche, Inc. v. Hiler (In Re Hiler) · filed 1989-04-10(a)

Therefore, the Court finds that the Plan has a valid right of recoupment with regard to the overpayments made to the Debtor, and that such right is not subject to the automatic stay.

Section 362(a)(7) does not bar recoupment of a utility deposit against unpaid charges for the same service.

In Re Norsal Industries, Inc. · filed 1992-10-14(a)(7)

Because LILCO was entitled to recoup the deposit made by the Debtor, LILCO did not violate the automatic stay by reducing the amount of the Debtor’s pre-petition indebtedness by taking possession of the Debtor’s pre-petition deposit.

Section 362(a)(7) permits recoupment as a narrow exception to the automatic stay when the opposing obligations arise from the same transaction.

Mercy Hospital of Watertown v. New York State Department of Social Services · filed 1994-07-27(a)(7)

Recoupment, however, is interpreted narrowly in the context of bankruptcy because it is an equitable rather than statutory exception to the automatic stay provision.

Section 362(a) does not stay a creditor’s recoupment of a prepetition overpayment from postpetition payments when both obligations arise from the same transaction.

Aetna Life & Casualty Co. v. LaPierre (In Re LaPierre) · filed 1994-12-30(a)

This recoupment is not subject to the automatic stay provisions of 11 U.S.C. § 362 and was not a dischargeable debt pursuant to the provisions of 11 U.S.C. § 524 and 11 U.S.C. § 727.

Section 362(a)(7) stays setoff but does not bar recoupment of overpayments from later benefits arising under the same contract.

Aetna Life Insurance v. Bram (In Re Bram) · filed 1995-04-05(a)(7)

Having found that Aetna’s right to recover overpayments constitutes recoupment, Aetna has not violated the automatic stay by exercising that right.

Section 362(a)(7) stays setoff, but does not bar defensive recoupment of a claim arising from the same transaction.

Newbery Corp. v. Fireman's Fund Insurance Co. · filed 1996-09-11(a)(7)

For similar reasons, we reject the appellants’ related arguments that the mutuality requirements applicable in setoff cases should also apply in recoupment, and that Fireman’s Fund's re-coupment defense should fail because Fireman's Fund allegedly violated the automatic stay.

Section 362’s automatic stay does not apply to recoupment rights that are not claims against the bankruptcy estate.

Justice v. Ohio, Bureau of Workers' Compensation (In Re Justice) · filed 1998-04-03

Ohio’s recoupment rights do not represent a “claim” against the estate of the Debtor, and are therefore not subject to either the automatic stay or the discharge injunction imposed by the bankruptcy laws.

Section 362(a)(7) does not stay recoupment of prepetition disability benefit overpayments from postpetition benefits owed under the same policy.

In Re Graves · filed 1999-01-21(a)(7)

To disallow UNUM to deduct its pre-petition overpayments from post-petition amounts owed on the same policy would amount to an unjustified windfall for Ms. Graves. Thus, upon finding UNUM’s actions constitute recoupment, which falls outside the scope of the automatic stay, the debtor’s motion should be denied.

Section 362(a)(7) does not stay recoupment of an overpayment from benefits owed in the same workers’ compensation claim.

Continental Casualty Co. v. Gullett · filed 1999-08-24(a)(7)

Any actions related to this recoupment cannot, as a matter of law, violate the automatic stay.

Section 362 does not bar a counterclaim that recoups a claim arising from the same transaction as the debtor’s claim.

Chapman v. Charles Schwab & Co. (In Re Chapman) · filed 2001-08-15(a)

So even if court permission had not been obtained, it is incorrect to assert that the automatic stay would have barred them from filing it.

Section 362(a)(7) stays setoffs, but it does not bar recoupment of overpaid benefits from later payments when both obligations arise from one integrated transaction.

Sigman v. Aetna Life Insurance (In Re Sigman) · filed 2001-12-07(a)(7)

A setoff is allowed in only very narrow circumstances and it is subject to the automatic stay. ... Therefore, pursuant to the reasoning of the above-cited cases, we hold that the monthly benefit checks and the LTDP are part of a single integrated transaction. ... Accordingly, Aetna has a right of recoupment against the funds it owes to the Debtors pursuant to the LTDP. ... Accordingly, debtor’s Motions for Contempt, Sanctions, and for Expenses are denied in their entirety.

Section 362(a) does not stay recoupment of prepetition Medicare overpayments from postpetition reimbursements when the obligations arise from a single, continuous and integrated transaction.

Holyoke Nursing Home, Inc. v. Health Care Financing Administration (In Re Holyoke Nursing Home, Inc.) · filed 2002-01-11(a)

Accordingly the withholding by HCFA, of amounts due to Holyoke postpe-tition, in order to recover prepetition Over-payments, was in the nature of recoupment, and did not violate the automatic stay under § 362(a).

Section 362(a)(7) stays setoffs, but recoupment of obligations arising from a single integrated transaction is outside the automatic stay.

Warsco v. Household Bank F.S.B. · filed 2002-01-15(a)(7)

Furthermore, unlike setoff, recoupment is not subject to the automatic stay of § 362.

The automatic stay does not apply to recoupment of an overpayment from benefits arising under the same contract, so the creditor need not seek court approval before recouping.

Powell v. FELRA (In Re Powell) · filed 2002-10-11(a)(7)

Conceptually, however, the automatic stay is not applicable. A defendant is not required to seek judicial approval prior to recoupment because the “right of recoupment does not constitute a debt which is dischargeable.”

Section 362(a)(7) does not bar recoupment of prepetition Medicare overpayments from postpetition reimbursements when the provider relationship constitutes one ongoing, integrated transaction.

Holyoke Nursing Home, Inc. v. Health Care Financing Administration · filed 2004-06-08(a)(7)

We likewise accept the majority view, and hold that the HCFA recovery of the $177,656.25 in overpayments previously made to Holyoke constituted a transaction in the nature of a recoupment, rather than a setoff. As such, it was neither a voidable preferential transfer nor a violation of the automatic stay.

The automatic stay does not bar recoupment of prepetition overpayments from postpetition payments when interim payments and subsequent adjustments form one ongoing, integrated transaction.

In Re Health Management Ltd. Partnership · filed 2005-12-13(a)

This system of payment of the full cost of services followed by a recalculation of what is actually owed and a subsequent adjustment for overpayments indicates one ongoing, integrated transaction. Therefore, Blue Cross’ recovery of the overpayments previously made to Health Management constituted a transaction in the nature of recoupment rather than setoff. Accordingly, it did not violate the automatic stay or the Court’s Order barring setoff.

Equitable recoupment of fraudulently obtained unemployment benefits from later benefits arising from the same transaction falls outside § 362's automatic stay.

In Re Mewborn · filed 2006-03-29

As such, the NJDOL properly recouped the Debtor’s 2004 benefits. The NJDOL did not violate the Debtor’s stay because the doctrine of recoupment operates outside of a debtor’s § 362 stay.

Section 362’s automatic stay does not bar an insurer from recouping disability-benefit overpayments against benefits owed under the same contracts.

Caldwell v. Continental American Insurance (In Re Caldwell) · filed 2006-09-26

The Court finds that the Defendants properly exercised their right of recoupment against the Plaintiff. ... So long as the creditor’s claim arises out of the same transaction as the debtor’s, that claim may be offset against the debt owed to the debtor without concern for the limitations the Bankruptcy Code places on the setoff doctrine.

Section 362(a) bars the government from offsetting prepetition ticket-refund claims against postpetition travel obligations when the debts arise from separate transactions and do not qualify for equitable recoupment.

Delta Air Lines, Inc. v. Bibb (In Re Delta Air Lines) · filed 2006-11-03(a)

The Government’s attempt to deduct from its post-petition liability in respect of GTR travel services claims for refund arising from unused airline tickets purchased by Government travel card years before Delta’s bankruptcy filing, under different and long-expired City Pair Contracts, cannot possibly be said to meet the single integrated transaction test. ... But it is not inequitable to treat the Government like all other creditors, who are barred by Bankruptcy Code Sections 362(a) and 553 from offsetting pre-petition claims against post-petition liabilities.

Section 362’s automatic stay does not bar recoupment of a prepetition overpayment from postpetition benefits when both obligations arise from the same transaction.

Beaumont v. Department of Veteran Affairs, United States (In Re Beaumont) · filed 2009-10-15

The Court finds, therefore, that the Defendant’s obligation to pay benefits to Plaintiff and the overpayment that the Plaintiff must repay arise from a single transaction, and that the Defendant’s recoupment of the overpayment from post-petition benefits did not violate the automatic stay nor the discharge injunction.

Section 362(a) stays an agency’s withholding of disability benefits to recover unrelated retirement-benefit debt when the debts do not arise from the same transaction and the withholding is not recoupment.

United States v. Johnson (In re Johnson) · filed 2018-03-12(a)

Because the debts are not logically related, the Court concludes that they do not arise from the same transaction. Thus the bankruptcy court correctly concluded that the automatic stay applied to the SSA's attempt to recover Johnson's debt, even though the bankruptcy court applied different reasoning.

The automatic stay does not affect equitable recoupment because recoupment is neither a claim nor a debt.

Process Am., Inc. v. Cynergy Holdings, LLC (In re Process Am., Inc.) · filed 2018-06-08

As recoupment is neither a claim nor a debt, it is unaffected by either the automatic stay or the debtor's discharge.

The automatic stay does not apply to property subject to recoupment.

Thigpen v. United States (In re Thigpen) · filed 2018-09-30

Property subject to the recoupment doctrine, by contrast, is exempt from the automatic stay.

Equitable recoupment of mutual debts arising from the same transaction is not subject to the automatic stay.

Williamson v. Pars · filed 2020-02-26

Binding precedent further makes clear that the equitable recoupment is not subject to the automatic stay.

Section 362’s automatic stay remains in place when a creditor cannot recoup a debt against its obligation to the debtor because the obligations do not arise from the same integrated transaction.

Deborah Lee Beacham · filed 2020-03-23

While the Parties’ obligations in this case would not arise but for their divorce, they do not arise out of the same integrated transaction. ... The automatic stay imposed by 11 U.S.C. § 362 has not terminated and therefore remains in place.

Section 362(a)(7) restricts setoffs during the automatic stay, but permits equitable recoupment when the creditor’s claim and the debtor’s payment right arise from the same transaction; shared funding supported recoupment of hospital assessments from supplemental payments, while deductions from separate fee-for-service payments were setoffs.

Gardens Reg. Hosp. & Med. Ctr. v. State of California · filed 2020-09-16(a)(7)

California therefore properly recouped Gardens Regional’s unpaid HQAF assessments into the segregated funds from the HQAF-funded supplemental payments that Gardens Regional was due to receive out of those same funds. ... Those deductions constitute a setoff that is subject to the restrictions of the Bankruptcy Code and not a permissible equitable recoupment.

Section 362’s automatic stay does not prevent a creditor from recouping an overpayment against a debtor’s claim arising from the same integrated transaction.

Advanced Tissue, LLC · filed 2023-03-16(a)

The automatic stay does not apply to CMS’s exercise of its right of recoupment.

Section 362’s automatic stay bars collection of a prepetition SSI overpayment from postpetition retirement benefits when the two debts do not arise from a single integrated transaction and recoupment does not apply.

Spencer v. Social Security Administration · filed 2025-07-23(a)(1)

This means SSA’s debt-collection activity during bankruptcy cannot be justified through the doctrine of recoupment and SSA violated the automatic Stay.

Section 362(a) does not stay recoupment of Medicare overpayments from a debtor’s Medicare reimbursements when the obligations arise from one integrated transaction.

In re IHN Podiatry Services, PLLC · filed 2026-04-06(a)

The automatic stay does not apply to CMS’s past or future exercise of its right of recoupment.

The automatic stay does not bar Medicare from recouping prepetition overpayments through postpetition underpayments that arise from the same transaction.

Sims v. United States Department of Health & Human Services (In Re TLC Hospitals Inc.) · filed 1998-06-18(a)

Applying such a standard, the Court has little difficulty holding that the payments at issue constituted a single transaction. ... Other courts have concurred with this decision in holding that recoupment under a Medicare provider agreement is not subject to the automatic stay in bankruptcy.

Section 362’s automatic stay governs setoff but does not bar recoupment.

Pruett v. American Income Life Insurance (In Re Pruett) · filed 1997-12-18

In a bankruptcy case, the distinction between the exercise of the right of setoff and the exercise of the right of recoupment is important because the exercise of the right of setoff is governed by the automatic stay while the exercise of the right of recoupment is not.

Section 362's automatic stay does not bar a utility from applying a pre-petition deposit to a pre-petition utility debt arising from the same transaction as recoupment.

In RE McMAHON · filed 1997-11-04(a)

For the above-stated reasons, we hold that a utility's post-petition application of a pre-petition utility deposit to a debtor's pre-petition utility obligation is a recoupment not subject to the automatic stay of 11 U.S.C. § 362.

Section 362 may stay a state court contempt action to enforce a divorce decree dividing marital property without violating the Tenth Amendment.

Barnett v. Barnett · filed 1984-01-18

Based on all of the foregoing, we hold that the automatic stay provision as provided for in Section 362, Title 11, U.S. Code, is not violative of the Tenth Amendment to the United States Constitution insofar as it stays a state court contempt action to enforce a divorce decree dividing marital property.

Section 362(b)(2)(A)(iv) permits equitable distribution proceedings concerning property outside the bankruptcy estate, but the automatic stay bars division of estate property unless the court grants relief.

Secrest v. Secrest (In Re Secrest) · filed 2011-07-15(b)(2)(A)(iv)

While § 362(b)(2) broadly removes domestic relations matters from the automatic stay, equitable distribution matters concerning property of the estate are excluded from the exception and may not proceed. Equitable distribution proceedings concerning property that is not property of the estate may proceed.

Section 362(b)(2)(A)(iv) permits a marriage dissolution to proceed despite the automatic stay so long as the proceeding does not determine the division of property of the bankruptcy estate.

In Re the Marriage of Vigil · filed 2011-06-14(b)(2)(A)(iv)

The trial court correctly concluded that the Bankruptcy Code did not prevent it from dissolving the Vigils’ marriage as long as it did not determine the division of property.

Section 362's automatic stay bars a state divorce court from distributing a debtor's marital property while that property remains in the bankruptcy estate and the stay has not been lifted.

McLeod v. McLeod, Unpublished Decision (12-14-2000) · filed 2000-12-14(a)

The automatic stay does apply to the equitable distribution of the debtor's interest in the martial assets. ... Therefore, the trial court lacked jurisdiction to adopt the part of the magistrate's decision concerning the award of marital property.

Section 362(a)(1) does not stay divorce proceedings.

Schock v. Schock (In Re Schock) · filed 1984-02-03(a)(1)

Since divorce proceedings are not stayed by section 362 of the Bankruptcy Code, it would be nonsensical for this Court to modify the stay to permit a divorce proceeding to continue.

Section 362(a)(3) stays an action to divide marital property of the bankruptcy estate, and a division made without relief from the stay is void.

Crowley v. Crowley · filed 1986-09-04(a)(3)

Both parties were, by definition, “debtors” within the meaning of 11 U.S.C.A. § 101(12) and certainly an action to distribute marital property was an act to obtain possession of the property of the [bankruptcy] estate or to obtain possession from that estate. ... As we have indicated, the division of marital property was void.