A common question that our clients have is whether they will be able to continue their utilities if they have an arrearage that is included in a bankruptcy.  This may include electrical, gas, water, and other basic household utility services.  This can be particularly concerning if the client is seeking to surrender their current personal residence and obtain other lodging, as they will have to open accounts with the utility companies.   

If at the time of filing the client is behind in their payments, it is possible that a disruption in service may occur, however, under the Bankruptcy Code, a utility may not refuse or discontinue service because a customer has filed bankruptcy, but the utility may require that the client provide ìadequate assuranceî that they will be able to pay for their utility service in the future within 20 days of filing the bankruptcy petition.  ìAdequate assuranceî may mean a cash deposit, a letter of credit, a certificate of deposit, a surety bond, a prepayment for future utility consumption, or some other type of security. Generally, what is required is some sort of deposit, though the amount of the deposit, where that is considered acceptable, is open to debate and negotiation.

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