Tenant Insolvency: Landlord’s Claim

The BIA provides landlords with a preferred claim for arrears of rent in the three months immediately preceding the date of bankruptcy and a claim for accelerated rent for the three months following the date of bankruptcy.

The claim for accelerated rent is only permitted if the lease agreement provides for such a claim. The landlord’s claim is reduced by two factors:

  1. It may not exceed the realization from the property on the premises;
  2. Any payment made by the Bankruptcy Trustee for occupation rent will be set-off against the accelerated rent portion of the claim.

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