Court Rules Eviction Moratorium Inapplicable in Ch. 7 Bankruptcy Case

The Covid-19 pandemic has affected individuals worldwide and, in response, both federal and state governments have passed orders attempting to provide aid and assistance to those affected the most. Among those orders is the Center for Disease Control and Prevention (“CDC”) federal eviction moratorium, which provides relief to protected individuals from being removed from their homes.

Recently, the United States Bankruptcy Court for the Central District of California has found that the CDC’s eviction moratorium will not prevent a court from removing a debtor from their home in a Chapter 7 bankruptcy case. In re Machevsky involves a debtor who filed for relief under Chapter 7 of the Bankruptcy Code. The debtor resided in real property consisting of two condominium units and was required to turn over possession of his real property to the bankruptcy trustee. The debtor failed to disclose the real property to the trustee and upon the trustee’s learning of the property, the Court issued a writ of execution, requiring the debtor to be forcibly removed from the property.

The debtor argued that the CDC’s eviction moratorium and related California state orders prevented the court from removing him from his property due to the Covid-19 pandemic. The Court ruled that those moratoriums were inapplicable in this case because the case was “outside the intended purpose of the moratoriums.” The Court explained that the debtor had filed for bankruptcy in 2014, long before the pandemic; the debtor failed to initially disclose this real property; and the debtor could not swear under penalty of perjury to each of the items set forth in the CDC Declaration Form. For these reasons, the Court found the eviction moratoriums were not applicable in this Chapter 7 Bankruptcy case.

It is unclear whether a court would issue a similar order with a different set of facts. Ultimately, most legal cases and opinions are fact intensive. If you have questions about filing for bankruptcy and its implications, please contact one of our attorneys.