Creditor Violated Stay ~ Opinions?

[squrlio]

I am new t the forum and have been lurking and digesting much info since my filing date of 8/20. 341 is coming up in 9/18.

I have a creditor who was a landlord for a retail space that I was personal guarantor on the lease. The business was failing in part due to landlord interference and partly due to economy and location. The landlord was constantly trying to sell or sublease our space and other things that interfered not only with our business plan, but with my sense of security. After 8 months of his I knew i had to dissolve the business and I repeatedly tried to negotiate out of the lease. My boyfriend-now-husband was managing the biz but not a member of the LLC that was on the lease. I was personal guarantor on the lease after the llc. We were behind 2 months rent when a week before the 3rd month he filed paperwork with the court to sue me because the lease stated that we were in default after 3 months rent in arrears. The court gave us less than 48 hours to appear, so we lost and got a judgement against both the LLC and me for $11,000. The court gave us 4 days to pay it back...the time at it took for us to get notice of this fact exceeded the repayment schedule! Then.... 2 weeks later he manages to get judgement for LLC and personal bank account levies and my wage garnishment . This guy is relentless ! So I had no choice but to file bankruptcy. I have no way to repay the $ with a failed biz and no assets left after having an emergency liquidation sale to try and raise $ to pay this clown. He is sending me invoices for rent even though we were evicted on 6/30.

After filing bankruptcy he was obviously notified. Now tonight , during my Automatic Stay, he has been emailing me and texting my husband trying to collect. I told him he was in violation of the 11 U.S.C 362 code .....forwarded all of his communications to my lawyer....annnnnd.... He keeps on texting my husband.

He says at he will file suit against the LLC because it is not in bankruptcy . I am the only person on record for the LLC. My husband is not responding to him after initially telling him he violated my stay. This guy will keep on coming at me and try to find a way to get his back rent and 'damages' and fees any way he can.

So if you stuck around long enough to read this....any thoughts???

[justbroke]

Unfortunately, corporations are not protected by your personal bankruptcy and the landlord can proceed after the business and the business' assets if there are any. The fine line that the landlord must walk, is threatening "in personam" or personal action against you. The corporation can certainly be sued and a judgment entered. As to whether any judgement would be collectible is another story.

If he wants to file a claim in your Bankruptcy, as a personal guarantor, that would not be an issue for him anyhow.

The only problem is if he goes after your "personal" interests. I had similar problems with a business that I owned, but my business was a sole-proprietor. I even argued with the creditor for a few minutes on the phone and told them it's their call to violate the stay since my form of business was sole-prop. They never called again. However, it would have been different if I elected to organize my company as a corporation (LLC, C-Corporation, S-Corporation).

Speak with your attorney. Again, it's a fine line and it really depends on how the landlord is approaching you. I have not read anything (above) that would indicate that the landlord was proceeding against you personally. By personally, I mean suing your personally to extract money from your personally. Whether his judgment is a judgment lien against your personal property is also a question for your attorney.

[squrlio]

justbroke thanks for looking over my scenario. I contacted my attorney with the emails and screenshots of his communications from last night. She sees it as possible extortion...trying to get me to agree to pay him more money in exchange for him 'dropping the possible lawsuit".

He filed suits against both me and the LLC right off the bat. He won both too. He's desperate to find a way to make me pay not only back rent but fees and 'damages' and he is now looking to find someone else he can slap a suit on (my husband). I am of the understanding that the LLC was an asset of mine, but since it has since dissolved and has no assets in and of itself then there is nothing further for the creditor to gain from it.

He is obviously savvy enough to address all of his communication to "XXX LLC" and not directly to me. I wonder if the he has crossed the 'fine line' by not only contacting my husband but harassing him as well. If he is so savvy he or his lawyer should have done their homework as to who is listed on the LLC.

[bcohen]

Did he succeed in levying any money from your bank account, or garnishing any money from your wages? If so, and if the amount is over $600, that's a preferential payment, and it's extremely important to let the bankruptcy trustee know about that fact, so he can "claw back" the money for the benefit of your other creditors. While you probably won't be able to recover any funds yourself, I'm sure it would feel good seeing the trustee go after this guy for whatever he took from you.

[justbroke]

There is a "fine line" and if he keeps contacting you directly, then he may have crossed that mystical point. I have told past creditors that I have filed and the debt is discharged. They claim that they can go after the business. I tell them to not contact "me" anymore. They have stopped on all occasions.

The problem with this type of ruthless but savvy creditor is that you need an attorney to at least address them with a letter or a phone call. I think your creditor is right on the line or has crossed the line. If they "harass" you, then they have definitely crossed the line. Once you tell them to not contact you personally, it should only be to the LLC (corporate entity) and only via a writing (unless the LLC has a published phone number).

[squrlio]

bcohen, fortunately but also unfortunately the funds he recovered through garnishment were under $600. The bank account levy happened to 2 accounts, one that the LLC owned that had a negative balance and the other that I owned personally that only had $133. The $133 is in a perpetual state of hold...I can see it in the account but cannot access it. Unless the funds eventually get released then I will close the account. I sure would like to claw that $ back from him but as you are probably aware, the legal fees exceed the amount that would be recovered.
My attorneys are having conversations with his attorney today. The outcome should be interesting. My husband and I were really shaken up by his efforts...we thought we'd get some peace during the Stay but were not surprised at all at the creditor's persistence.

And, justbroke, yes what you said is almost exactly what my attorney said in a follow up email last night. I am hoping that they are the types of lawyers that enjoy the pursuit of creditors like this guy! Trying to be objective here but he's come really close to making this personal. The insults, trying to cut my husband off with his giant truck and trailer, threats of lawsuits. My lawyer advised me to not get emotionally upset by his actions. Apparently they deal with these types of creditors alot.
Thanks for your insights!

[squrlio]

Well, by luck the creditor's attorney returned the garnishment check to my attorney. He then sent it to me and my employer voided it and gave me the $441 back. My attorney commented on this stroke of good fortune in his letter that he sent explaining the check.
Doing a happy dance for once in a great while!

[justbroke]

Perhaps your adversary is now battle weary and did not want to potentially incur more legal fees than it was worth.

[SweetGeorgia]

I'm glad that something finally went right for you! Maybe this guy's attorney finally talked some sense into him. In my opinion, these individual creditors (where it's "a guy you know" and not some large corporation) are just the worst. Large corporations suck in some ways, but it's really hard to deal with individuals who don't know or don't believe in bankruptcy law.

What he said about "going after the LLC" leads me to believe he's small-time. I had LLCs, and they were sued right along with us, but nothing proceeded against them after we filed bankruptcy because they didn't have any assets.