Landlord Liable For Lease Termination Damages
The Seventh Circuit Court of Appeals recently decided that a landlord terminating a lease prior to the bankruptcy of a tenant may be held liable for the receipt of a preferential or fraudulent transfer. This may expose landlords to later having to pay up for taking position of property encumbered by below market leases.
Audrey Noll at Fox Rothschild wrote a compelling article (see link below). article www.foxrothschild.com/content/uploads/2016/03/Financial-Restructuring-Bankruptcy-Alert-March-2016-Noll-Seventh-Circuit-Rules-That-Prepetition-Lease-Termination-May-Be-Avoidable-Transfer_.pdf