In re Walton Hotel Co., 7326.

• Court: U.S. Court of Appeals — Seventh Circuit
• Writing for the Court: EVANS and KERNER, Circuit , and LINDLEY
• Citation: In re Walton Hotel Co., 116 F.2d 110 (7th Cir. 1940)
• Decision Date: 18 December 1940
• Docket Number: No. 7326.,7326.
• Parties: In re WALTON HOTEL CO. OLHAUSEN et al. v. WALTON HOTEL CO.

116 F.2d 110 (1940)

In re WALTON HOTEL CO OLHAUSEN et al. v. WALTON HOTEL CO.

No. 7326.

Circuit Court of Appeals, Seventh Circuit.

November 27, 1940.

Rehearing Denied December 18, 1940.

Irving S. Abrams, of Chicago, Ill., for appellants.

Wm. J. Flaherty, Milton M. Adelman, and W. J. Friedman, all of Chicago, Ill., for appellee.

Before EVANS and KERNER, Circuit Judges, and LINDLEY, District Judge.

LINDLEY, District Judge.

Petitioners appeal from an order of the District Court entered in a reorganization proceeding on March 15, 1940, denying their petition to vacate a previous order entered July 14, 1939, which approved a lease of certain hotel property to other parties, and to direct a lease to petitioners.

At the outset we are met with respondents' contention, supported by the master's report and approved by the court, that petitioners were estopped to seek the relief in the District Court because, upon an earlier petition for the same relief, the court entered an order on August 12, 1939, denying the relief prayed. The facts in this regard are that on August 11, 1939, two of the petitioners, Brand and Alice Olhausen, petitioned the court to set aside the order of July 14, 1939, which approved the action of a corporation to whom the debtor's property had been conveyed under the plan of reorganization, in leasing the property to another operating company. The District Court denied the prayer. Petitioners' motion for leave to appeal was denied by this court on October 12, 1939. Following this denial on October 20, 1939, the present petitioners filed a second pleading in the District Court in which Margaretha Olhausen joined, in which, despite some difference in verbiage, the relief prayed was in substance the same as that sought in the petition of August 11, with the additional prayer that, upon cancellation of the lease previously approved, the court direct that a similar lease be made with the Olhausens as lessees.

The undisputed evidence is that Brand, who was petitioner in both proceedings, though a bondholder of record, held his bonds for Margaretha Olhausen and had no interest therein himself but represented her as her agent. Furthermore, it appears that Alice Olhausen acted both for herself and her mother throughout the proceedings. Thus it is clear that the subject matter involved in both petitions was the same; that the issues of law and fact were identical; that the present petitioners were all parties to the original proceeding either in their proper person or by authorized representatives and privies.

But decisions on motions do not necessarily have the force of res adjudicata. Courts possess discretion to permit a second application. Whether such renewal shall be entertained depends upon the circumstances of the case; for courts have the power to prevent vexatious and repeated pleadings upon the same point and ordinarily exercise their discretion to preclude reagitation of the same question on the same state of facts. These rules have their origin in the necessity of orderly conduct of business. Freeman on Judgments, §§ 276, 669. Irrespective of whether the prior order is a complete estoppel as such, the circumstances here impel us to refuse to review the action of the court in the exercise of its discretion to refuse a re-examination into facts previously heard. The situation is not far foreign to that upon a motion for a new trial or a rehearing. The showing requisite to allowance...