CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE SEVENTH CIRCUIT.
Stone, Roberts, Black, Reed, Frankfurter, Douglas, Murphy, Byrnes, Jackson
MR. JUSTICE ROBERTS delivered the opinion of the Court.
The court below has construed § 75 (n) of the Bankruptcy Act*fn1 as bringing within the court's jurisdiction property mortgaged by the debtor as to which, after foreclosure, the debtor's equity of redemption had expired.*fn2 Because of conflict of decision*fn3 we granted certiorari.
Subsequent to the adoption of § 75 the respondents borrowed $2,500 from the petitioner and gave a promissory note secured by mortgage on their farm in Indiana. In a foreclosure proceeding in an Indiana state court petitioner obtained judgment November 20, 1939, ordering that the property be sold to satisfy the debt. May 25, 1940, the sheriff sold the farm to the petitioner. The respondents, who had not redeemed, filed their petition under § 75 on May 28, 1940, listing the farm in their schedules.
June 1, 1940, the sheriff executed and delivered his deed to the petitioner; and, June 30, 1940, petitioner filed, in the District Court, a motion to strike the farm from the schedules on the ground that, at the date of the petition, the respondents had no right or equity in the property as the period of redemption provided by state law expired at the time of the sheriff's sale. The court granted the motion and struck the property from the schedules. The Circuit Court of Appeals, by a divided court, reversed the judgment.
Section 75 (n), so far as pertinent, provides:
"The filing of a petition . . . praying for relief under . . . [this section] shall immediately subject the farmer and all his property, wherever located, for all the purposes of this section, to the exclusive jurisdiction of the court, including all real or personal property, or any equity or right in any such property, including, among others . . . the right or the equity of redemption where the period of redemption has not or had not expired, or where a deed of trust has been given as security, or where the sale has not or had not been confirmed, or where deed had not been delivered, at the time of filing the petition.
"In all cases where, at the time of filing the petition, the period of redemption has not or had not expired, or where the right under a deed of trust has not or had not become absolute, or where the sale has not or had not been
confirmed, or where deed had not been delivered, the period of redemption shall be extended or the confirmation of sale withheld for the period necessary for the purpose of carrying out the provisions of this section."
The applicable statute of Indiana is Chapter 90 of the Acts of 1931.*fn4 Although this statute appears not to have been construed by the state courts, it seems plain that under its provisions a sale in foreclosure can not be had until one year after the institution of the proceedings and that a ...