Bekins

On December 13, 1941, appellee, Compton-Delevan Irrigation District, filed with the District Court of the United States for the Northern District of California a petition under chapter 9, §§ 81-84, of the Bankruptcy Act, 11 U.S.C.A. §§ 401-404 . Appellee, at the time of filing the petition, had outstanding $384,000 of bonds, of which $11,000 (11 bonds of the face value of $1,000 each) were owned and held by *1017 appellants, Milo W. Bekins and Reed J. Bekins, as trustees, under the last will of Martin Bekins, deceased. With the petition, appellee submitted a plan of composition, under which the bondholders were to surrender their bonds and receive therefor 20% of the principal amount thereof. Thus, under the plan, appellants were to receive for their bonds $2,200 (20% of $11,000).

On March 11, 1942, an interlocutory decree was entered. That decree confirmed the plan, appointed a disbursing agent, required appellee to deposit with the disbursing agent $76,800 (20% of $384,000), directed the bondholders to surrender their bonds to the disbursing agent within a specified time and directed the disbursing agent to pay for bonds so surrendered the amounts payable therefor under the…