Notice of Automatic Stay

Summary

This notice of automatic stay template is for use by debtor's counsel to inform creditors and other parties in interest of the automatic stay. This template includes practical guidance and drafting notes. Upon the filing of a bankruptcy petition, the Section 362(a) stay automatically goes into effect. The purpose of the stay is to maintain the status quo as of the filing date thereby giving bankruptcy courts the opportunity to harmonize debtor and creditor interests. The broad scope of Section 362 of the Bankruptcy Code prevents creditors from taking almost any action outside of the bankruptcy court's supervision that would extend any unfair advantages to one creditor over another. "[F]from the point of view of counsel for the debtor or trustee, compliance is what is desired and, to that end, appropriate notice should be given to parties in interest. Many experienced counsel for debtors prepare a form of notice of automatic stay that, while not a formal pleading, has the practical effect of slowing creditor action." 2 Collier Bankruptcy Practice Guide P 38.02. For more information and resources on the automatic stay, see Automatic Stay and Automatic Stay Resource Kit.