IN BE HOLLENFELTZ.

629

property acquired or claimed by trustees to. be put to unnecessary inconvenience and expense in litigating their rights. I find support for this view of the law in Burnett v. Mercantile 00., 91 Fed. 365, in Mitchell v. McClure, ld. 621, and He Abraham (recently decided by the circuit court of appeals, Fifth circuit) 1 Nat. Bankr. News, 281,93 Fed. 767. It is not necessary in this case to give construction to the last clause of subdivision b of section 23 which reads, "Unless by consent of the proposed defendant," but I am inclined to think it has reference, not to jurisdiction in bankruptcy courts, but to courts having jurisdiction of the subject-matter of the action, but not of the perBon of the proposed defendant. The motion for the injunction will be overruled, and the bill will be dismissed, at complainant's costs.

In re HOLLENFELTZ. (District Court, N. D. Iowa. June 12, 1899.)
BANKRUPTCy-MoRTGAGE CREDITOR-PAYMENT OF TAXER.

Where a mortgage creditor of the bankrupt forecloses his mortgage, and bids in the property at the foreclosure sale, but the property remains In the possession of the trustee in bankruptcy during the time allowed by law for redemption, and the latter collects rent from tenants of the premIses, the creditor Is not entitled to be reimbursed, out of such rent, for the amount advanced by him payment of taxes which were due and a lien on the property at the time of the sale.

In Bankruptcy.

On review of rulings of referee.

Duffy & Maguire, for bankrupt. SHIRAS, District Judge. From the facts certified up by the referee in the above case it appears that Michael Hollenfeltz was adjudged a bankrupt on October 4,1898; that at that time the Dubuque National Bank held a mortgage on the middle and south middle fifths of lot 434 in the city of Dubuque to secure an indebtedness due the bank, upon which a decree of foreclosure was rendered in favor of the bank at the January term, 1899, ()f the district court of Dubuque county, Iowa, and that at the sheriff's sale had in purI;lUance of the decree of foreclosure the bank became the purchaser of the realty for the sum of $11,145, and now holds the sheriff's certificate of sale, the time of the redemption under the statute of Iowa not having expired. It further appears that at the time of the sheriff's sale there were due up()n said realty, and a lien thereon, the . taxes for the year 1897 and 1898, amounting to the sum of $16.60, which have been paid by the bank, and it also appears that the trustee has collected as rentals from the mortgaged realty the sum of $176. Based up()n these facts, the bank now asks an order directing the trustee to apply, S() far as necessary, the rentals received from the realty to the repayment of the taxes, on the ground that it would be inequitable to require the bank to pay the taxes, and yet permit the trustee to retain the rentals for the benefit of the

. The toip,ake: B;f. the cO.ilrtfol'd.,review and decision:. . .. "'.' '.;' I, . ., I .. , " ' , ,.' ·· .. . . .a h . .. ..e. reque . t . t>..r fh ..s. .·.a.s:cert.Ifi.e.d.t to th.e.b .',]V;l1en bank becap:te the 'at- the sherIff's sale, It bought the same to' lienor the taxes then upon it. If. had been. a:. bankrupt, he be n m ,the property untU the perjoij of no fll"cts to holdillg cop.ldhave comp'elleq to apply his the payment of';the taxes.' The presumptWD IS, ,that the amoullt bid by the bank at the sale. was the sum the})ai;lk,,,,as to give property in Its then condition; that is, subject to the lien of the 'unpaid' taxes; ,If the property' should be redeemed from this sale by anyone, the bank will receive the amount of its bid, plus the amount of the prior liens paid by it, If 1:'¢emption is not made, which would include the then the bank will obtain the title to the property for the considerground ation it bid at the sale, and there seems to be no for granting the relief prayed for by the bank. If)! were true that: the o:};fili, by reason of at the foreclosure sale, had beco;:u{entitled to prbpert:r during the year of reas against the JI}.ortgagQI.' might claim the same as its, property, even. though: they. bad been collected by the tl"llsteetl but it is bank 'had the right to the rentals, and therefore itha's tight' ol'equity and there the bank ,entitled to be reimexists no ground for bursed, out of the rentals, for the amounts advanced by it in payment of the taxes upon the realty which itpurchasoo at the sheriff's sale. The ruling of the referee is therefore affirmed.

no

-_.------, Inre CURTIS et at (Circuit Court ot Appeals;;Sevellth Circuit. Jupe 6, 1899.) No. 575. A debtor made a general assignment for the benefit ot.creditors undt'l'& state statute providing tor the administration and distribution by the staur courts ot .estates so assigned, and requiring' creditors to file their claim. within three. mpnths aftell notice from the assignee. on pain of being postponed Hntil :all. proving c:t:editors were paid m full. The time having not yet ari'ived 'when a petition in involuntary bankruptcy couId be filed under the' act ot '18'9S, certain creditors filed their claims with the assignee; being then i'11 'Ignorance ot facts tending to show that the assignment was ' aJl,d that the debtor l\ad, disposed of property in fraud of cred, itors. Noilividend was declared under the assignment, nor any judicial action taken on the claims filed. Held, . tha1 such creditors were not es.toppedtomitintain a petition in involuntary bankruptcy agalnstthe debtor.
I'

-PETITiONING CREDITORS-EsTOPPEL.

Appeal from,the District Court of the u'Ilited States for the Southern District of Ulinois.
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,In bankrUprey. On August 11, 1898, the banJumpts, who are surviving partners of Levi H. Henry, deceased, doing business as the Bank ot Waverly, in