Warren v. Security-First Nat. Bank, 9727.

• Decision Date: 28 July 1941
• Docket Number: No. 9727.,9727.
• Citation: 121 F.2d 822
• Parties: WARREN v. SECURITY-FIRST NAT. BANK OF LOS ANGELES et al.
• Court: U.S. Court of Appeals — Ninth Circuit

121 F.2d 822 (1941)

WARREN v. SECURITY-FIRST NAT. BANK OF LOS ANGELES et al.

No. 9727.

Circuit Court of Appeals, Ninth Circuit.

July 28, 1941.

Frank J. McCarthy and Elizabeth Hensel McCarthy, both of Los Angeles, Cal., for appellant.

Paul E. Iverson, of Los Angeles, Cal., for appellees.

Before GARRECHT, HANEY, and STEPHENS, Circuit Judges.

GARRECHT, Circuit Judge.

On April 19, 1940, appellant here, Blanche Augusta Warren, as petitioner under Chapter XII of the act of Congress relating to bankruptcy, 52 Stat. 840, 916, 11 U.S.C.A. § 801 et seq., filed her petition in the District Court of the United States for the Southern District of California, Central Division, alleging that she had pending an arrangement whereby her secured obligation to Security-First National Bank of Los Angeles, a national banking association, would be either paid in full or refinanced on terms satisfactory to such secured creditor.

The petitioner further alleged that said secured creditor, under deed of trust executed by petitioner, was about to sell certain described property, which, if carried out, would deprive petitioner of the benefit of the said Bankruptcy Act, to her great and irreparable loss and damage. A restraining order was prayed for.

The judge of said District Court on said April 19, 1940, entered his order restraining such sale. On the same day appellant's said petition under the Bankruptcy Act was approved, and the matter referred to one of the referees in bankruptcy of said court. In this order occurs the language: "that the said Blanche Augusta Warren * * * shall submit to such orders as may be made by said referee or by this Court relating to said matter."

On April 29, 1940, on application of Warren said temporary restraining order was continued, and it was further ordered that said Security-First National Bank and Los Angeles Trust & Safe Deposit Company each appear in court at 10 a.m. on the 6th day of May, 1940, to show cause why the restraining order referred to above should not be made permanent. On May 27, 1940, all of the parties hereto appeared in the District Court; they filed with the court an agreement dated on said date, executed by all the parties, which contained recitals in the nature of a stipulation. It stated that certain described properties were owned by appellant; that the Security-First National Bank held a deed of trust thereon to secure an unpaid debt of approximately $58,000, which was in default; that the trustee under said deed of trust had set a day for the sale of the premises; that Warren, appellant here, had filed a petition under the Bankruptcy Act and obtained a temporary restraining order against said sale under the trust deed, and that there was pending an order for said appellees to show cause why the restraining order should not be made permanent; that the appellee Bank had made a motion to dismiss said arrangement proceedings in bankruptcy and dissolve the said temporary restraining order, or in case the proceedings were not dismissed, to require Warren to post security to indemnify the Bank against loss.

The document recited that the parties hereto desire to dispose of Warren's order to show cause and the Bank's motions without the necessity of a hearing thereon and to agree upon an order to be made by the court. In this connection it was stipulated: "(d) That on or before August 15th, 1940, Warren will present to the Bank a written agreement executed by a financially responsible party, whereby said responsible party commits his or herself to pay the obligation to the Bank in full on or before November 15th, 1940. The Bank agrees not to hinder, delay, prevent or interfere with any prospective purchaser of this property, or to hinder, delay, prevent or interfere with such purchaser or responsible party from carrying out the written agreement hereinbefore referred to, or the payment of the obligation of Warren to the Bank; nothing herein stated shall interfere with the Bank's right to reject any such prospective purchaser as being not financially responsible. * * *"

It was further stipulated:

"That the said Court may make and enter its order dismissing said arrangement proceedings and authorizing the Bank and Trustee to hold said Trustee's sale prior to November 15, 1940, without any notice to any persons or parties, on the happening of any of the following events:

"1. If Warren fails to present to the Bank a written agreement, executed by a responsible party, on or before August 15, 1940, whereby said responsible party commits his or herself to pay in full the obligation to the Bank by November 15, 1940. * * *"

Upon the foregoing stipulations, the parties being present in open court, the court entered an order thereon containing among other things the following: "That on or before August 15th, 1940, Blanche Augusta Warren shall present to Security-First National Bank of Los Angeles a written agreement executed by a financially responsible party, whereby said responsible party commits his or herself to pay the obligation to said Bank in full on or before November 15th, 1940."

And said order embodied the following provisions:

"That this Court hereby retains jurisdiction to and shall make and enter an order dismissing this proceeding and authorizing the Security-First National Bank of Los Angeles and the Los Angeles Trust & Safe Deposit Company to hold said Trustee's sale and to exercise any and all rights and powers they have under the said deed of trust on said properties prior to November 15, 1940, without any notice to any persons or parties, on the filing of an affidavit showing the happening of any of the following events:

"(a) That Blanche Augusta Warren has failed to present to the Security-First National Bank of Los Angeles a written agreement, executed by a responsible party, on or before August 15, 1940, whereby said responsible party commits his or herself to pay in full the obligation to the said Bank by November 15, 1940; * * *."

On August 23, 1940, appellee Security-First National Bank filed the affidavit of its assistant secretary, alleging the non-compliance of appellant Warren with the stipulation and order aforesaid. Thereupon an order to show cause why the proceedings should not be dismissed and the trustee authorized to hold sale and exercise rights under the deed of trust was entered. In response thereto appellant Warren filed a motion to modify and extend the order of the court. On August 27th said parties appeared in court, and evidence, both oral and documentary, was submitted, and the court being fully advised entered the following order:

"1. That the above entitled proceedings are hereby dismissed.

"2. That the Security-First National Bank of...