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Key Facts
- Federal level: 11 U.S.C. § 362 generally imposes an automatic stay when a bankruptcy petition is filed, without requiring a separate stay order.
- Federal level: The stay covers specified actions against the debtor, property of the bankruptcy estate, and certain property of the debtor, but subsection 362(b) contains many exceptions.
- Federal level: A party in interest may request relief from the stay, and the court may terminate, annul, modify, or condition it on grounds stated in subsection 362(d).
- Federal level: Repeat filings can shorten or prevent the stay under subsections 362(c)(3) and (c)(4), subject to the statute’s procedures for obtaining court protection.
11 U.S.C. § 362 is the federal Bankruptcy Code’s automatic-stay provision. In ordinary terms, it pauses many actions that would otherwise continue against a debtor or bankruptcy-estate property after a case begins.
The word “automatic” matters because the filing itself generally activates the stay. No separate injunction is ordinarily required, although the statute contains exceptions and special rules that can change whether a stay exists or how long it lasts.
What subsection 362(a) stays
Subsection 362(a) lists eight categories of stayed conduct. They include starting or continuing certain proceedings against the debtor based on prepetition claims, enforcing a prepetition judgment, and taking specified acts to obtain or control estate property.
The provision also reaches certain acts to create, perfect, or enforce liens and certain acts to collect, assess, or recover prepetition claims against the debtor. A creditor is the person or entity asserting the right to payment or another bankruptcy claim.
The statute distinguishes actions against the debtor from actions involving property of the estate. Section 541 generally creates the estate when the case begins and places the debtor’s existing legal and equitable property interests into it, subject to statutory inclusions and exclusions.
The automatic stay is broad, not unlimited
Subsection 362(b) contains a long list of conduct that a bankruptcy filing does not stay. Important examples include the commencement or continuation of a criminal case, specified family-law proceedings, some domestic-support collection, and qualifying exercises of governmental police or regulatory power.
Other exceptions address taxes, securities and financial contracts, residential eviction circumstances, pension-loan withholding, and additional specialized subjects. The exact statutory exception matters because a broad label such as “tax action” or “family case” does not describe every part of the exception.
The stay also does not automatically protect every nondebtor. Chapter 13 has a separate codebtor stay in section 1301 for collection of qualifying consumer debts from certain individuals who are liable with the debtor, subject to that section’s exceptions and relief provisions.
How long the stay lasts
Under subsection 362(c), the stay of an act against estate property generally continues until that property is no longer property of the estate. For other stayed acts, the stay generally continues until the earliest of case closure, case dismissal, or the grant or denial of a discharge.
Those general rules do not answer every case. A court can grant relief under subsection 362(d), and special provisions govern repeat filings, residential leases, certain personal-property leases, and other circumstances.
Repeat filings can change the automatic result
If an individual’s Chapter 7, 11, or 13 case was pending and dismissed during the previous year, subsection 362(c)(3) generally ends the stay on the thirtieth day after the later filing with respect to the debtor. A party in interest may seek continuation after notice and a hearing completed before that period expires by satisfying the statute’s good-faith standard.
If two or more qualifying cases were pending and dismissed during the previous year, subsection 362(c)(4) generally provides that the stay does not go into effect in the later case. The statute permits a party in interest to request an order imposing the stay within 30 days if the required showing is made.
These repeat-filing rules contain exclusions, presumptions, evidentiary standards, and timing requirements. Their operation depends on the filing history and the statute’s precise conditions rather than on the number of petitions alone.
Relief from the stay
Subsection 362(d) directs the court to grant relief on request of a party in interest and after notice and a hearing when a statutory ground is established. Relief can take the form of terminating, annulling, modifying, or conditioning the stay.
One ground is “cause,” including lack of adequate protection for an interest in property. Another applies to an act against property when the debtor lacks equity in that property and the property is not necessary to an effective reorganization.
Federal Rule of Bankruptcy Procedure 4001 governs motions for relief from the stay. Among other things, it addresses service, emergency relief without prior notice, notice after emergency relief, and the temporary stay of an order granting relief.
Unless the court orders otherwise, Rule 4001(a)(4) stays an order granting a motion for relief for 14 days after entry. That interval is distinct from the automatic stay itself.
What City of Chicago v. Fulton clarified
In 2021, the Supreme Court held that merely retaining possession of estate property does not violate subsection 362(a)(3). The Court read the provision’s ban on an “act” to exercise control as targeting affirmative conduct that changes the status quo, not passive retention by itself.
The decision addressed subsection 362(a)(3), not every stay provision or every turnover question. The Court expressly left disputes under other subsections and section 542’s turnover command outside the narrow question it decided.
Violations and damages under subsection 362(k)
Subsection 362(k) provides a damages remedy for an individual injured by a willful violation of a stay supplied by section 362. The statute calls for actual damages, including costs and attorney fees, and allows punitive damages in appropriate circumstances.
A separate limitation applies when the violation rests on an entity’s good-faith belief that subsection 362(h) applies. Section 362(k) states the remedy, while courts determine how its terms apply to proven facts.
The stay and discharge are different
The automatic stay regulates conduct during a bankruptcy case; a discharge addresses personal liability for qualifying debts. A stay can terminate before discharge, and a case can end without a discharge.
Section 362 is therefore best read as a structured set of rules rather than a blanket statement that all collection permanently stops. Subsections (a), (b), (c), and (d) answer different questions about scope, exceptions, duration, and court-ordered relief.
