Legal Q&A: Is back rent lost if tenant goes bankrupt?

April 24, 2015

Question: Our tenant owes us back rent and is stating that he is probably going to file bankruptcy. We’ve been trying to work with him but are getting nervous now. Do we lose all the back rent if he files bankruptcy?

Answer: It depends. If he files a Chapter 7, there is little hope. If he files a Chapter 13, you may receive all or a portion of the back rent.

Ted Kimball
Kimball, Tirey & St. John LLP

Question: If a tenant’s rent is due on the first day of the month and there is no grace period, what is the earliest date I can serve a three-day notice to pay rent or quit?

Answer: You can serve a three-day notice to pay rent or quit when the rent is legally delinquent. California law requires that one business day must expire before the rent is considered delinquent. So, if the first day of the month falls on a weekend or holiday, you must wait until the day after the first business day expires before serving the notice. If the first day falls on a business day, the notice can be served on the second of the month.

Question: If the landlord accepts a rent payment from someone other than the lessee, does that give them any rights?

Answer: It could if they are occupants of the property. This could convince a court that they are now tenants under a verbal agreement.

Kimball, Tirey & St. John LLP is a full service real estate law firm representing residential and commercial property owners and managers. This article is for general information purposes only. Laws may have changed since this article was published. Before acting, be sure to receive legal advice from our office. If you have questions, please contact your local KTS office. For contact information, please visit our website: www.kts-law.com. For past Legal Alerts, Questions & Answers, and Legal Articles, please consult the resource library section of our website.

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