Bankruptcy Court Says HOA Foreclosure Sale Stands Due to Late Filing of Chapter 11 by Property Owner

US Bankruptcy Court, Eastern District of New York decision (January 6, 2015)

In this case, the owner of property sought to have a foreclosure sale conducted by the community homeowners association approximately two and one-half hours prior to the filing of a Chapter 11 bankruptcy set aside by virtue of the automatic stay caused by the filing of the bankruptcy.

The owner sought an order from the bankruptcy court that “retroactively” applied the automatic stay that was triggered when the bankruptcy petition was filed back to the time of the foreclosure sale which was conducted earlier in the morning on the same day the bankruptcy was filed. The owner contended that the tardy bankruptcy filing was due to […]