Sidney W. Mundt, and Alice Louise Mundt v. Southland Savings & Loan Association of Chula Vista

PER CURIAM: Appellants appeal from an order entered on February 12, 1965, by the United States District Court affirming the orders of the Referee in Bankruptcy vacating temporary orders restraining South-land Savings & Loan Association of Chula Vista from foreclosing on a deed of trust. On March 27, 1963, appellants were owners of a single family residence located on a lot in Imperial Beach, County of San Diego,'State of California. Said lot and residence were encumbered by a deed of trust dated June 13, 1961, executed by appellants to secure an indebtedness evidenced by a promissory note in favor of South Bay Savings & Loan Association now known as Southland Savings & Loan Association of Chula Vista. Commencing in October, 1962 appellants defaulted in the payments due the holder of the note secured by the deed of trust. On March 19, 1963, appellants filed in the United States District Court for the Southern District of California their petition for proceedings for an arrangement under Chapter XI of the Bankruptcy Act. Pursuant to an application therefor, an order to show cause and temporary restraining order was issued by the Referee in Bankruptcy. On March 22, 1963, the Referee issued his order restraining foreclosure and allowing appellants to remain in possession. Following a number of hearings before the Referee, and on October 27, 1964, the Referee, after notice and on hearing, vacated the order restraining the foreclosure. On November 30, 1964, upon the application of appellants the court granted a stay order in the foreclosure proceedings for the purpose of having a rehearing on December 4, 1964. Following a rehearing, the Referee filed a stay of the order pending the perfection of a petition to the District Court for a review of said order. On petition to the District Court to review said order, the District Court, after hearing, affirmed the order of the Referee vacating the restraining order and vacating the stay order issued by the Referee. Upon this appeal appellants complain that the order vacating a previously issued order restraining foreclosure was inequitable and unjust and violated the Fourteenth Amendment to the Constitution of the United States prohibiting seizure of property without due process of law. We have carefully reviewed the record in this case and find no abuse of discretion on the part of the Referee or the District Court in vacating the restraining order previously issued, nor any denial of due process. The instant case and the case of Mundt v. Home Federal Savings & Loan Association, et al., 349 F.2d 938 (9th Cir. 1965), arise out of the same Chapter XI proceeding. In the latter case the temporary restraining order was issued in connection with the proceedings to foreclose a deed of trust on an apartment house building owned by appellants, where as in the instant case the property involved was the personal residence of the debtors and did not relate to the business which appellants sought to save by the Chapter XI proceedings. The order appealed from is affirmed.