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Hurricane Sandy Forces Temporary Closure of Manhattan Bankruptcy Court

November 12, 2012

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A historic storm forced one of the country’s busiest bankruptcy courts to temporarily close its doors, according to a Reuters report.

Sources say the U.S. Bankruptcy Court in lower Manhattan, which rests in a building that has gained historic status, has been indefinitely closed following electrical outages and severe flooding caused by Hurricane Sandy.

Those seeking bankruptcy relief will not be affected by the closure, as the court’s cases will simply be moved to another venue, but officials do not know when the court will be able to reopen, according to a public information officer for New York’s federal courts.

As recently as last week, the building that houses Manhattan’s bankruptcy court had no heat, and it also had no phone or Internet connection. In addition, the courthouse’s basement flooded during the storm.

Sources note that all the water and sewage was drained from the basement shortly after the storm, but the courthouse will remain closed while officials repair the damage to the historic building.

The bankruptcy court is located in the Alexander Hamilton Custom House, a building with ornate decorations that was built at the beginning of the last century.

The building was once an important hub for commerce in lower Manhattan, but sources say it remained vacant for most of the 1970s before the federal government decided to move Manhattan’s bankruptcy court to the building in 1987.

Bankruptcy laws are designed to provide relief and protection to individuals struggling with debt. Learn how bankruptcy laws can help you by speaking with a local bankruptcy lawyer.

In response to the closure of the building, bankruptcy judges acted fast to move consumers’ cases to nearby courts. Sources say that Manhattan judges were given permission to move personal bankruptcy hearings to nearby courts in White Plains and Poughkeepsie.

Judges are also expected to handle a larger number of minor meetings by phone during the interim period. In addition, Manhattan’s federal district court, which is housed in a different building, is expected to provide space for extra bankruptcy hearings, according to sources.

The closure of one of the country’s busiest bankruptcy courts demonstrates the destructive power of Hurricane Sandy, which shut off power to millions of Americans across the Eastern seaboard.


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