Opinion
No. 5488.
June 5, 1935. Rehearing Denied July 26, 1935.
Appeal from the District Court of the United States for the Eastern District of Illinois; Walter C. Lindley, Judge.
In the matter of the Granada Hotel Corporation, debtor. From an order ( 9 F. Supp. 909), sustaining a petition under the Bankruptcy Act by Sam Harris and others, creditors, C.S. Tuttle and others, as members of a committee constituted under the terms of a deposit agreement, appeal.
Affirmed.
Don Kenneth Jones, Vincent O'Brien, and John M. Baker, all of Chicago, Ill., for appellants.
Frank E. McAllister, Morris Schaeffer, and Thomas V. Sullivan, all of Chicago, Ill., for appellees.
Before EVANS, FITZHENRY, and ALSCHULER, Circuit Judges.
Concededly there is but one question in this case, and that is whether or not, at the time of the filing of the petition under section 77B of the Bankruptcy Act (11 USCA § 207), there was "a prior proceeding in * * * equity receivership * * * pending." The record shows that, prior to the filing of this petition, a bill to foreclose had been filed in the state court by a second mortgagee under which a receiver had been appointed. While that case was pending, the trustee named in the first mortgage appeared in the state court and asked that court to enter an order directing its receiver to report to the trustee and turn over to it the possession of the mortgaged property. The state court entered the order, but the foreclosure case was still pending before the master at the time of the filing of the petition herein and jurisdiction over the property and the trustee remained with that court. This showing was sufficient to sustain the jurisdiction of the bankruptcy court under section 77B (11 USCA § 207), Clark on Receivers, §§ 12, 13, 14 and 963, and the District Court so held.
The order of the District Court sustaining the petition is therefore affirmed.