Miller v. McKenzie

WASTE, C. J.

Defendant McKenzie appeals from a decree quieting plaintiff’s title to certain real property. Plaintiff claims through a deed issued by the duly appointed trustee in bankruptcy of the Fred Blinman Company, which company was adjudicated a bankrupt upon its voluntary petition. The property was sold to plaintiff “free and clear” of liens and encumbrances. That a bankruptcy court, upon due notice to creditors, whose liens will be affected thereby, may so dispose of property of a bankrupt is well established.

(In re Union Trust Co.,

122 Fed. 937, 939;

McRaney

v.

Riley,

128 Miss. 665 [91 South. 399, 400-402, 22 A. L. R. 685]; Id., 260 U. S. 727 [43 Sup. Ct. Rep. 90, 67 L. Ed. 484]; 2 Remington on Bankruptcy, secs. 1965, 1980.) Appellant, a judgment lienor of the bankrupt, contends that she was not given due or proper notice of the proposed sale and that respondent therefore took title subject to her lien. This assault upon the bankruptcy proceeding, coming as a defense to a quiet title action, is collateral in character and must therefore fail unless the asserted invalidity or want of jurisdiction is apparent upon an examination of the record in that proceeding.

(City of Salinas

v.

Lee, ante,

p. 252 [18 Pac. (2d) 335];

Gray

v.

Hall,

203 Cal. 306, 313 [265 Pac. 246]; 1 Freeman on Judgments, 5th ed., secs. 305, 399. ) Such portions of the bankruptcy record as are now before us fail to disclose any such defect. Upon the trial of the present cause the appellant stipulated to the filing of the petition in bankruptcy and to the due appointment of the trustee through whom respondent derived title. In supplement thereof, and in order to establish his unencumbered title to the property, respondent introduced in evidence certified copies of the trustee’s return of sale, the petition for and confirmation of such sale, and the trustee’s deed. Each of these several documents indicates that the property was sold to respondent “free and clear” of all encumbrances. Appellant failed upon the trial of the cause