News and Events
The Impact of BAPCPA on Commercial Properties and Leasing
Senior Vice President Spence J. Mehl provides commentary to Bankruptcy Litigation Reporter addressing the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005.
Dec 11, 2009 Bankruptcy Litigation Reporter Spence J. Mehl
When the Bankruptcy Abuse Prevention and Consumer Protection Act was formally signed into law April 20, 2005, the act was advertised as a consumer-targeted initiative. While much of the media attention and public debate in the four years since the bill’s passage has indeed been focused on its consumer impact, it is now clear that portions of BAPCPA have had a significant impact on retail and other bankruptcies involving nonresidential real estate as well.
The official narrative has been that the intent of the law, which formally went into effect in October 2005, was to minimize abusive or fraudulent bankruptcy filings by implementing a more stringent set of filing requirements for Chapter 7, and subsequently channeling more bankruptcy filings under Chapter 13. When the bill was passed, much of the discussion centered on precisely these issues.
What garnered less attention, however, was the notion that the less-publicized portions of the bill directed at bankruptcies involving nonresidential real estate had the potential for a significant impact on the landlord-tenant dynamic.