Opinion · Supreme Court of the United States

Tuttle v. Harris

Tuttle v. Harris, 297 U.S. 225 (1936)

Type: Opinion
Court: Supreme Court of the United States
Jurisdiction: Federal
Date: 1936-02-03
Topic: general

Mr. Justice Cardozo delivered the opinion of the Court. The controversy here, as in Duparquet Huot & Moneuse Co. v. Evans, decided at the same time, ante, p. 216, is one as to the meaning of the words “equity receiverships” in the statute for the reorganization of debtor corporations. Bankruptcy Act, § 77 B (a); 11 U.

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Cited by: 19 opinions

Headnotes

Bankruptcy Law — Corporate Reorganization — "Equity Receivership" Under § 77B(a) A mortgagee let into possession of mortgaged property in foreclosure proceedings under state law is not an equity receiver within the meaning of § 77B(a) of the Bankruptcy Act. 297 U.S. at 226
Bankruptcy Law — Corporate Reorganization — "Equity Receivership" Under § 77B(a) The appointment of a receiver merely to collect rents and profits in a suit to foreclose a mortgage does not create an equity receivership within the meaning of § 77B(a) of the Bankruptcy Act. 297 U.S. at 226
Bankruptcy Law — Corporate Reorganization — Mortgagee in Possession Under Illinois Law Under Illinois law, a mortgagee after condition broken is the owner of a legal estate and is entitled as of right to possession of the mortgaged premises; a mortgagee so let into possession holds as owner, not as receiver, and its possession is therefore not that of an equity receiver for purposes of § 77B(a). 297 U.S. at 226

TUTTLEv. HARRIS,297 U.S. 225(1936)

56 S.Ct. 416

TUTTLE ET AL.v. HARRIS ET AL.

CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE SEVENTH CIRCUIT.

No. 428.

Argued January 17, 1936.

Decided February 3, 1936.

A mortgagee let into possession in foreclosure proceedings, under the law of Illinois, is not an equity receiver within the meaning of § 77B (a) of the Bankruptcy Act.Duparquet HuotMoneuse Co. v.Evans, ante, p. 216. P. 226.78 F.2d 409, reversed.

CERTIORARI,296 U.S. 567, to review a decree affirming one of

the District Court,9 F. Supp. 909, which denied a motion of the

present petitioners to dismiss an application under § 77B (a) of

the Bankruptcy Act.

Mr. George T. Buckingham, with whomMessrs. Don KennethJonesandVincent O'Brienwere on the brief, for petitioners.Mr. Maurice Walk, with whomMessrs. Frank E. McAllisterandWilliam J. Gracewere on the brief, for respondents.

MR. JUSTICE CARDOZO delivered the opinion of the Court.

The controversy here, as inDuparquet Huot Moneuse Co. v.Evans, decided at the same time,ante, p. 216, is one as to the meaning of the words "equity receiverships" in the statute for the reorganization of debtor corporations. Bankruptcy Act, § 77 B (a); 11 U.S.C. § 207 (a).

A mortgagee brought suit against Granada Hotel Corporation in the Superior Court of Cook County, Illinois, to foreclose a second mortgage upon real property of the corporation located in that state. A receiver was appointed to collect the rents and profits. Thereafter a prior mortgagee, the trustee under a deed of trust toPage 226secure an issue of bonds, brought suit to foreclose the prior mortgage, and in accordance with the law of Illinois laid claim to the possession of the property as owner after condition broken. In response to that claim the state court made an order discharging the receiver, and directing that the prior mortgagee be let into possession.

While possession was so held, respondents brought a proceeding under Bankruptcy Act, § 77 B, contending that the possession of the mortgagee was that of an equity receiver or at least equivalent thereto. The District Court upheld that contention, denying a motion by petitioners, who had intervened in the proceeding, to dismiss the application,9 F. Supp. 909; and the Court of Appeals for the Seventh Circuit affirmed.78 F.2d 409. A writ of certiorari issued from this court.

An equity receivership within the meaning of the statute does not result from the appointment of a receiver for the collection of the rents in a suit to foreclose a mortgage.Duparquet HuotMoneuse Co. v.Evans, supra. But here there was no receiver either for the collection of rents or for any other purpose. A mortgagee after condition broken under the law of Illinois is the owner of a legal estate, and as such entitled as of right to the possession of the mortgaged premises.Wolkensteinv.Slonim,355 Ill. 306;189 N.E. 312. The grantee under the deed of trust was in possession not as receiver, but as owner.

The decree should be reversed, and it is so ordered.Reversed.

MR. JUSTICE VAN DEVANTER took no part in the consideration or decision of this case.Page 227