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0 tracked cards Commercial and Taxation Laws

In a rehabilitation proceeding under RA 10142, the RTC issues a Commencement Order and designates a Rehabilitation Receiver to manage the debtor's affairs. A secured creditor holds a mortgage on the debtor's main facility and had a foreclosure action pending before the commencement order. Which of the following statements best explains the controlling doctrine on the Effects of a Commencement Order, focusing on the stay and its possible exceptions, the status of the pending foreclosure, and the procedure to obtain relief from the stay if applicable?

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The Commencement Order provides for an automatic stay on actions against the debtor and its property, including a pending foreclosure, but the court may grant relief from the stay on motion after notice and a hearing if continuation would impede rehabilitation. Relief from stay is granted automatically after a fixed period unless the debtor or rehabilitation receiver objects in writing. The Commencement Order automatically stays all actions against the debtor and its property, including a pending foreclosure, and the stay is absolute and cannot be modified by the court. The stay applies only to actions against the debtor; proceedings to enforce the mortgage against the collateral can continue regardless of the CO.

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