Source: http://www.chanrobles.com/usa/us_supremecourt/297/160/case.php
Timestamp: 2019-11-20 14:50:01
Document Index: 390630690

Matched Legal Cases: ['§ 77', '§ 24', '§ 25', '§ 24', '§ 77', '§ 25', '§ 24', '§ 25', '§ 77', '§ 14', '§ 32']

On February 4, 1935, an involuntary petition was filed in the District Court for Northern Illinois for reorganization of a corporate debtor. The debtor filed an answer admitting the essential allegations of the petition, and the District Court found that the petition was filed in good faith, and ordered that it stand approved, and that creditors be restrained from asserting claims against the property of the debtor. After this order was entered, the petitioner here filed a petition in the reorganization proceeding setting up that she owned some of the mortgage bonds to which the property of the debtor was subject; that, subsequent to the petition for reorganization, but before it was approved, she had brought suit in the state courts against the debtor and others for an accounting, charging fraud in the issue and sale of the bonds and a fraudulent scheme to bring about a reorganization of the debtor to the detriment of the bondholders and to the advantage of the defendants in the suit. She prayed that the petition for reorganization be chanroblesvirtualawlibrary
When § 77B introduced into the Bankruptcy Act the proceeding for reorganization of a corporation, it was provided that the procedure to be followed in case reorganization were ordered should, so far as practicable, follow chanroblesvirtualawlibrary
The appeal provisions of §§ 24 and 25 [Footnote 2] of the Bankruptcy Act are thus made applicable to orders entered in the course of a reorganization proceeding, and an order approving or disapproving a petition for reorganization is made the equivalent, at least for purposes of an appeal under § 25a, of a judgment adjudging or refusing to chanroblesvirtualawlibrary
The petitioner appealed not from the order approving the reorganization, but from that denying her application to dismiss the reorganization proceedings. It is not contended that this order is one in a controversy arising in bankruptcy, appealable as of right under § 24a. See Taylor v. Voss, 271 U. S. 176, 271 U. S. 181; Harrison v. Chamberlin, 271 U. S. 191; Hewit v. Berlin Machine Works, 194 U. S. 296, 194 U. S. 299-300. It is urged that it is the equivalent of an order approving a petition in a reorganization proceeding, which § 77B(k) assimilate to an order of adjudication, appealable as of right. But an order refusing to set aside an adjudication of bankruptcy is not within § 25a, clause (1). This Court has held that an appeal can be taken from such an order only on leave of the appellate court under § 24b. Valley v. Northern F. & M. Insurance Co., 254 U. S. 348. The present appeal from the order refusing to dismiss the reorganization chanroblesvirtualawlibrary
proceedings does not stand on any different footing, and was rightly dismissed because taken without leave of the appellate court. Humphry v. Bankers Mortgage Co., 79 F.2d 345; Vitagraph, Inc. v. St. Louis Properties Corp., 77 F.2d 590; St. Louis Can Co. v. General American Life Insurance Co., supra; Credit Alliance Corp. v. Atlantic Pacific & Gulf Refining Co., 77 F.2d 595, and see Wilkerson v. Cooch, 78 F.2d 311.
2. In No. 376, petitioner contends that the order of the District Court approving the plan of reorganization corresponds to an order confirming or rejecting a composition with creditors, and that the latter, as was held in United States ex rel. Adler v. Hammond, 104 F.8d 2, is appealable as of right under § 25 as equivalent to an order "granting or denying a discharge." But we think it plain that an order confirming a plan of reorganization under § 77B is not the equivalent of a judgment granting or denying a discharge, for, unlike confirmation of a composition, see § 14c, 30 Stat. 550, 11 U.S.C. § 32(c), it does not operate as a discharge. The release of the debtor in a reorganization proceeding is contingent upon the performance of its part of the reorganization plan. Section 77B(h) commands the debtor and others to execute chanroblesvirtualawlibrary