Though bankruptcy filings are down in 2021, the expiration of the Paycheck Protection Program and reopening of the courts nationwide could lead to a rise in bankruptcy filings with many businesses still struggling to cope with the economic and supply chain aftereffects of the pandemic and consumer purchasing habits.  These bankruptcies, in turn, will have an inevitable ripple effect on creditors and other claimants, whose abilities to collect on claims and exercise rights, are significantly restricted by the automatic stay.  Generally, the automatic stay requires a party seeking relief against a debtor to do so in, and only in, the bankruptcy court, which can provide the relief sought or grant permission to pursue claims and rights in another venue.  For many businesses, considerations regarding the automatic stay end there, believing so long as they were deliberate enough to seek relief in the bankruptcy court, they will not face the potentially harsh consequences of violating the automatic stay.  But, a recent decision in In re Roman Catholic Church of the Archdiocese of Santa Fe serves as the latest reminder that very rarely can one be too careful when seeking relief against a debtor, even in the bankruptcy court itself.
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