In the Matter of Madeline Dorr Taylor, Debtor-Appellant v. B. G. Wood and Mary D. Wood, Creditors-Appellees

Debtor-appellant, Madeline Dorr Taylor, filed a petition on July 15, 1969 for a real property arrangement under Chapter XII of the Bankruptcy Act, 11 U. S.C. 801 et seq. Appellees, B. G. Wood and Mary D. Wood, the sole affected creditor, hold a deed of trust covering the property.

Following a hearing on November 5, 1969 the referee found that the Woods declined to accept the debtor’s plan, which in effect was simply a request for “reasonable time in which to sell” the property; that the Woods had been restrained from foreclosing their deed of trust since the inception of the proceedings; and that the debtor had received no bona fide offer (after consultation with over 400 real estate brokers) to purchase the property.

In dismissing the petition the referee concluded that (1) debtor’s plan was incapable of confirmation under Section 467 or 468 of the Bankruptcy Act where the lone creditor affected refused to accept; and (2) the plan was not an arrangement contemplated by Section 461 but simply a request for a restraining order, and in any event debt- or had a reasonable time to sell.

Upon the debtor’s petition for review the district court held that the referee properly rejected…