This appellate decision addressed the issue of “whether the stay provided by Section 362 of the 1978 Bankruptcy Code (11 USC §362[a]) operates as a ‘statutory prohibition’ under CPLR 204(a) to toll the statute of limitations (SOL) to commence a mortgage foreclosure action against a defendant debtor who no longer owns the property that is the subject of the mortgage foreclosure action.”

The court held that the bankruptcy stay pursuant to Section 362(a)(1) (§362) “tolls the (SOL) for commencing a mortgage foreclosure action against the defendant debtor, regardless of whether that defendant owns the property at the time of the bankruptcy filing.”

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