Can I charge interest back to the date a Chapter 11 filing if it was recently dismissed or does the stay that was put into effect stop the accrual of interest?

A customer filed 3 years ago owing 4K but their bankruptcy was recently dismissed. I would like to re-submit an invoice and include interest back to the date that the Chapter 11 notice was received. However, I am curious if the “stay” that was put into effect only applies to collection activities or accrued interest? The interest portion is now considerable at about 3K.

Asked on June 7, 2012 under Business Law, Tennessee


FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

The stay under 11 U.S.C. section 362 with respect to the Chapter 11 bankruptcy that was dismissed pertains to collection activities and not the running of interest of an unpaid debt owed a creditor such as you.

Since the debtor's bankruptcy was dismissed as opposed to discharged or the reorganization plan was not confirmed and completed, you have accrued interest owing on the $4,000 owed you by your customer that you can claim.

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