# Relief from the automatic stay

Source: https://www.jhenrylaw.com/mechanism/relief-from-the-automatic-stay/
Author: John P. Henry, John Henry & Associates, PLLC
Reviewed: 2026-08-02

**11 U.S.C. § 362; Fed. R. Bankr. P. 4001**

## What happens to a Texas judgment or lawsuit when the debtor files bankruptcy?

Everything stops. The petition operates as a stay of the commencement or continuation of litigation, of enforcement of judgments, and of any act to obtain possession of estate property — automatically, without an order, the moment it is filed. A creditor that wants to keep going must move for relief, or establish that the stay never applied to what it is doing.

> [A] petition filed under section 301, 302, or 303 of this title … operates as a stay, applicable to all entities, of — (1) the commencement or continuation … of a judicial, administrative, or other action or proceeding against the debtor … (2) the enforcement, against the debtor or against property of the estate, of a judgment obtained before the commencement of the case under this title.

— 11 U.S.C. § 362(a)(1)–(2)

## When it applies

The constable on the courthouse steps, the garnishment served last week, the trial three weeks out. It also applies to the creditor who did not know — acts in violation of the stay are void or voidable regardless of notice, and § 362(k) provides damages for willful violations against an individual debtor.

## How it is proved up

1. Ask first whether the stay applies at all. It reaches the debtor and property of the estate; it does not reach a non-debtor guarantor, and a lease that terminated before the petition may not be estate property to begin with.
2. For cause under § 362(d)(1), or under § 362(d)(2) where the debtor has no equity and the property is not necessary to an effective reorganisation. Pick the ground and prove it — they need different evidence.
3. Move for an emergency hearing where the collateral is wasting or the lease is in default. The court will hear it, and speed is most of the leverage.
4. Ask for a waiver of the fourteen-day stay under Fed. R. Bankr. P. 4001(a)(3). Without it the order does nothing for two weeks.
5. Tell your constable or sheriff the day you learn of the petition. A sale conducted in violation of the stay is worse than no sale.

## What defeats it

- Adequate protection — payments, replacement liens or an equity cushion that protects the creditor while the case proceeds.
- Property genuinely necessary to an effective reorganisation that is in reasonable prospect.
- A debtor who cures and reinstates.
- Nothing at all, sometimes: the stay is one of the few things in litigation that works automatically and immediately, and a creditor’s best move is often to file a claim and wait.

## Where I have used it

From the creditor’s side of it. In AAT Bioquest, Inc. v. Texas Fluorescence Laboratories, Inc., Cause No. D-1-GN-16-001929, 261st Judicial District Court, Travis County, a constable had levied on the debtor’s real property and the sale was noticed for the first Tuesday in May 2017. The debtor filed Chapter 11 before it. Months of execution work stopped on the day of the petition, which is the lesson worth carrying: the stay is automatic and immediate, and the creditor who has just spent the money is the one who learns it.

## Questions

**Does the automatic stay stop a Texas execution sale?**

Yes. Section 362(a)(2) stays enforcement against the debtor or against property of the estate of a judgment obtained before the case was commenced. A sale held after the petition is void or voidable even if the creditor did not know of the filing.

**How quickly can a creditor get relief from the stay?**

Section 362(e) provides that the stay terminates thirty days after a request for relief unless the court orders it continued after a preliminary hearing. In practice, urgent motions on wasting collateral or defaulted leases are heard far sooner.

**Does the automatic stay protect guarantors?**

Not ordinarily. The stay protects the debtor and property of the estate, so an action against a non-debtor guarantor generally proceeds — which is why guaranties matter so much in commercial lending.


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