Does the referee have grounds for finding constructive possession of a property?

MultiRegion, United States of America

The following excerpt is from Martoff v. Elliott, 326 F.2d 204 (9th Cir. 1963):

Apparently this finding was made with the intention of indicating that the appellant herein had consented to constructive possession by the trustee and thus to the summary jurisdiction of the referee by not protesting sooner. We do not agree. Although neither the findings of the referee nor the record give us any indication of the exact dates on which the trustee demanded of the tenants that the rents be paid to him, or on which the next rents were due, there was only a twenty-one day period between the filing of the petition and the institution of the turnover proceedings. We do not think that a landlord of property should be held to have waived the right to a plenary proceeding and have submitted to the summary jurisdiction of a bankruptcy court because he does not immediately protest the trustee's action, especially when the rights of the parties were required to be determined in some court of law; and when the court proceedings began three weeks after the bankruptcy filing. A finding to the contrary would encourage trustees and receivers to seize property without the benefit of notice or hearing to the landlord, or, also as here, without the benefit of a court order. At most, the trustee could only have received one pair of checks for the rent of this duplex in this period of less than one month. If Hannah v. Swift, supra, has no application and if appellant did not waive her right to question the summary jurisdiction of the referee, we see no other grounds for finding constructive possession, the first essential ingredient for summary jurisdiction.

II Was the claim of appellant a substantial, adverse claim?

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