The opinion of the court was delivered by: RIFKIND
On motion for reargument.
Mast Corporation, a creditor of the debtor corporation, heretofore moved for a contempt order against John R. Blair Co., another creditor, and John R. Blair, its president, for an alleged violation of an order of this Court dated July 15, 1941, staying a certain foreclosure proceeding pending in the Supreme Court of the State of New York, in which the aforesaid Mast Corporation was plaintiff and the debtor one of the defendants. The motion was denied. The opinion is reported at 40 F.Supp. 611, 614.
Mast Corportion does not seek reconsideration of that decision; it does request the elimination from the opinion of the words: "That judgment [of foreclosure, entered in the New York Supreme Court on July 17, 1941] is void and of no legal effect".
In support of its motion for reargument, Mast Corporation has brought to the attention of the court, by affidavit, additional facts not heretofore disclosed because it did not apprehend that the validity of the judgment was questioned. The relevant facts may be chronicled in the order of their occurrence:
December 14, 1940 -- The debtor executed a mortgage on its real property to the assignor of Mast Corporation;
June 18, 1941 -- to foreclose its mortgage by reason of defaults, Mast Corporation instituted proceedings in the New York Supreme Court;
July 3, 1941 -- an involuntary petition for the reorganization of the debtor under Chapter X of the Bankruptcy Act, 11 U.S.C.A. § 501 et seq., was filed in this Court;
July 15, 1941 -- on application ex parte, of one of the petitioning creditors, this Court made an order temporarily staying the foreclosure proceeding until the approval or dismissal of the petition;
July 16, 1941 -- a copy of the aforesaid order was mailed to Mast Corporation;
July 17, 1941 -- the aforesaid order was entered on the docket of this Court, (whether beforr or after the other events occurring on this day, is unknown);
July 17, 1941 -- a judgment of foreclosure was entered in the state court proceeding at 11:22 A.M.;
July 17, 1941 -- a copy of the stay order was received by Mast Corporation by mail, but it is claimed that the envelope containing it was ...