Bastian v. Erickson

114 F.2d 338, 1940 U.S. App. LEXIS 3114
CourtCourt of Appeals for the Tenth Circuit
DecidedAugust 22, 1940
DocketNo. 2153
StatusPublished
Cited by14 cases

This text of 114 F.2d 338 (Bastian v. Erickson) is published on Counsel Stack Legal Research, covering Court of Appeals for the Tenth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bastian v. Erickson, 114 F.2d 338, 1940 U.S. App. LEXIS 3114 (10th Cir. 1940).

Opinion

HUXMAN, Circuit Judge.

The question presented by this appeal concerns itself with procedural steps required by Section 75, sub. s, of the Bankruptcy Act, 11 U.S.C.A. § 203, sub. s. A contract was executed August 15, 1938, wherein appellee sold appellant certain real and personal property. The personal property consisted of machinery, livestock and growing crops. The consideration was $14,000, which was to be paid as follows: $2,000 more or less on February 1, 1939, and $1,000 on the first day of each February thereafter until the entire consideration, together with interest, was paid. Appellant was also to pay the taxes beginning with the year 1938 and a mortgage to the California Western States Life Insurance [339]*339Company, of $900. The payment of the $900 mortgage was to be deducted from the $2,000 due February 1, 1939. Possession of the premises, together with the growing crops, was delivered on the date of the contract. The growing crops, partly matured and partly harvested, were valued at about $1,500. The only payment made by appellant after the execution of the contract was the mortgage of $900 to the insurance company, together with interest of $53.91. This 'payment was made from proceeds realized from the 1938 crops. The contract provided that thirty days grace was allowed in making the payments and that if the payments were not made as required by the contract, the vendor “shall have the right to re-enter and take peaceable possession of said lands and improvements and of this agreement and the warranty deed and all other papers pertaining to this agreement.” After default, appellee served notice of default and demanded surrender of the premises. Possession being refused, she filed an action in the District Court of Wayne County, Utah, for cancellation of the contract and for the possession of the premises. The decision of the trial court was in favor of appellant. An appeal was taken to the Supreme Court of Utah. May 4, 1940, the Supreme Court rendered its decision reversing the trial court, and entering the following decree, 102 P.2d 310, 314: “The judgment of the trial court is reversed. The cause is remanded with directions to make findings according with the views expressed herein and enter a decree awarding the plaintiff the possession of the property.”

May 17, 1940, appellant filed his petition in the District Court of the United States for the District of Utah for relief under Section 75 of the Bankruptcy Act. He scheduled and listed as assets all of the property involved in the contract. The petition was referred to the Conciliation Commissioner. No report was ever made by the Conciliation Commissioner.

May 28, 1940, appellee filed her petition in the bankruptcy proceeding, reciting the proceedings had, and alleged that appellant was not the owner of the property described in the petition; that his contract and right thereto had been cancelled by the decision of the Supreme Court of the State of Utah; that possession of the property to appellee had been ordered by the court; and prayed that it be decreed that appellant did not own any interest in the property, that the property be stricken from the petition, and the petition filed under Section 75, subs, a to r, of the National Bankruptcy Act be dismissed. May 28, 1940, the court issued its order directed to appellant to show cause why the prayer of the petition should not be granted. On June 1, 1940, the court issued its order authorizing the District Court of Wayne County, Utah, to proceed in accordance with the decision of the Supreme Court of Utah and to make findings of fact and conclusions of law and a decree pursuant to said decision, and directed that copies of such findings of fact, conclusions of law and decree after they had been made, be filed in the bankruptcy court.

June 20, 1940, appellant filed his petition in the bankruptcy court, praying the court to issue an order directed to appellee and to the Sheriff of Wayne County, Utah, to show cause why the court should not make and enter an order restraining the Sheriff from executing a writ of execution issued by the state court and from in any way interfering with the possession of appellant over the property. Such an order to show cause was issued.

June 27, 1940, appellee filed her petition alleging her ownership and right to the possession of the property under the decree of the Supreme Court of Utah, and asked to be permitted to proceed to recover the possession and control of the property. June 28, 1940, after hearing had, the court entered its order dismissing the petition of appellant, and ordered that all the property in controversy be stricken from the petition and schedules in the bankruptcy proceeding. From this order an appeal has been taken to this court.

It is appellant’s theory that the filing of his petition under Section 75 of the Bankruptcy Act, May 17, 1940, subjected all this property to the exclusive jurisdiction of the bankruptcy court and that under Subsection o the bankruptcy court had no power or authority to strike the property from the schedules or authorize the District Court of Wayne County to proceed to enter judgment in accordance with the mandate of the Supreme Court prior to a hearing and a report. of the Conciliation Commissioner.

Section 75, sub. n of the Bankruptcy Act, as amended, provides that upon the filing of a petition, all property or interest in property of the debtor petitioner shall be subject to the exclusive jurisdiction of the bankruptcy court. Subsection o pro[340]*340vides that none of the listed proceedings, including proceedings by way of execution, attachment or garnishment seizure, distress sale or other proceedings, shall be had in any court unless granted by the judge after a hearing and report of the Conciliation Commissioner. Subsection p provides that the prohibitions of Subsection o shall apply to all judicial or official proceedings in any court, or under the direction of any official.

Section 75, sub. n, vests exclusive jurisdiction of the debtor and all of his property or any interest therein in the District Court on the filing of the petition. Thereafter no action or proceeding may be maintained against the debtor in any other court or jurisdiction with relation to any of his property except by permission of the District Court.

Under Subsection, o, upon application therefor the court may'grant a petitioner permission to proceed in some other court against the debtor or his property. Whatever doubt may have existed as to the interpretation of Subsection o has been cleared away under the decisions of the Supreme Court. The District Court has jurisdiction to grant permission to proceed against the debtor or his property in some other jurisdiction only after a hearing and report by the Conciliation Commissioner. Union Joint Stock Land Bank of Detroit v. Byerly, 310 U.S. 1, 60 S.Ct. 773, 84 L.Ed. 1041, decided by the Supreme Court April 22, 1940; McFarland v. West Coast Life Ins. Co. et al., 9 Cir., 112 F.2d 567. No hearing having been ‘ had before the Conciliation Commissioner, it follows that the District Court was without jurisdiction to grant appellee permission to proceed in any other court with relation to any property in which appellant had' an interest.

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Cite This Page — Counsel Stack

Bluebook (online)
114 F.2d 338, 1940 U.S. App. LEXIS 3114, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bastian-v-erickson-ca10-1940.