UNITED STATES SUPREME COURT DECISIONS ON-LINE

Real property in Louisiana was bound by a judicial mortgage.

The owners of the property then took the benefit of the Bankrupt Act of the United States.

A creditor of the bankrupt then filed a petition against the assignee, alleging that he had a mortgage upon the same property prior in date to the judicial mortgage, but that by some error other property had been named, and praying to have the error corrected. Of this proceeding the judgment creditor had no notice. clubjuris

Page 54 U. S. 374

The court being satisfied of the error, ordered the mortgage to be reformed, and thus gave the judgment creditor the second lien instead of the first, and then decreed that the property should be sold free of all encumbrances. Of this proceeding and also of the distribution of the proceeds of sale the judgment creditor had notice, but omitted to protect his rights.

In consequence of this neglect, he cannot afterwards assert his claim against a purchaser who has bought the property as being free from all encumbrances.

The facts are stated in the opinion of the Court. clubjuris

Page 54 U. S. 377