In Re Oakland Popcorn Supply, Inc.

Glen D. Neece and Mazie M. Neece, stockholders in the bankrupt corporation, seek review of the Referee’s order of June 8, 1962 denying their petition to dismiss this bankruptcy proceeding. Because of the unusual posture in which this proceeding comes before the Court, a somewhat detailed account of its procedural history is a prerequisite to consideration of the issues tendered on this review.

This proceeding was initiated on July 12, 1961 by an involuntary petition filed by L. Cotter, a creditor of the bankrupt by reason of an assignment to him of the claim of Vogel & Son Popcorn Company in the amount of $9,007.50 for popcorn supplied to the bankrupt. The petitioning creditor alleged on information and belief that the number of creditors of the bankrupt was less than twelve. He alleged two acts of bankruptcy: (1) that the bankrupt had on July 7, 1961, while-insolvent, permitted a creditor to obtain a lien upon its property and had failed to have it vacated or discharged, although the property was to be sold by the Sheriff on July 14, 1961; and (2) that the bankrupt had on July 10, 1961 admitted in writing its inability to pay its debts and its willingness to be adjudged a…