ter: Provided, however, That the United States or any State may in writing accept the provisions of any arrangement dealing with the assumption, settlement, or payment of any such tax.

Article XIII-When Chapter Takes Effect

Sec. 399. (11 U.S.C. § 799.) Proceedings to Which Chapter Applies

(1) On and after the effective date of this amendatory Act, this chapter shall apply to debtors and their creditors, whether their rights, claims, and interests of any nature whatsoever have been acquired or created before or after such date;

(2) a petition may be filed under this chapter in a proceeding in bankruptcy which is pending on the effective date of this amendatory Act;

(3) the provisions of sections 12, 73, and 74, as amended, of the Act entitled "An Act to establish a uniform system of bankruptcy throughout the United States," approved July 1, 1898, shall continue in full force and effect with respect to proceedings pending under those sections upon the effective date of this amendatory Act; and

(4) sections 395 and 396 of this Act shall apply to compositions and extensions confirmed under sections 12 and 74 before the effective date of this amendatory Act and to compositions and extensions which may be confirmed under sections 12 and 74 on and after such effective date.

Derived from section 77B p.

Chapter XII

REAL PROPERTY ARRANGEMENTS BY PERSONS OTHER THAN CORPORATIONS

This chapter, added by the Chandler Act (1938), constitutes the first bankruptcy legislation on its specific subject. It represents a special development of the principles of composition applied in former sections 12 and 74.

For a table of cross references to corresponding sections of chapters X, XI and XIII, see p. 225, ante.

Article I-Construction

Sec. 401. (11 U.S.C. § 801.) Exclusive Application of Chapter The provisions of this chapter shall apply exclusively to proceedings under this chapter.

Sec. 402. (11 U.S.C. § 802.) Application of Other Provisions

The provisions of chapters I to VII, inclusive, of this Act shall, insofar as they are not inconsistent or in conflict with the provisions of this chapter, apply to proceedings under this chapter: Provided, however, That subdivision n of section 57 shall not apply in such proceedings unless an order shall be entered directing that bankruptcy be proceeded with pursuant to the provisions of chapters I to VII, inclusive. For the purposes of such application, provisions relating to "bankrupts" shall be deemed to relate also to "debtors," and "bankruptcy proceedings" or "proceedings in bankruptcy" shall be deemed to include proceedings under this chapter. For the purposes of such application the date of the filing of the petition in bankruptcy shall be taken to be the date of the filing of an original petition under section 422 of this Act, and the date of adjudication shall be taken to be the date of the filing of the petition under section 421 or 422 of this Act.

Article II-Definitions

Sec. 406. (11 U.S.C. § 806.) In General

For the purposes of this chapter, unless inconsistent with the context

(1) "arrangement" shall mean any plan which has for its primary purpose the alteration or modification of the rights of creditors or of any class of them, holding debts secured by real property or a chattel real of which the debtor is the legal or equitable owner;

(2) "claims" shall include all claims of whatever character, against a debtor or his property, whether or not such claims are provable under section 63 of this Act and whether secured or unsecured, liquidated or unliquidated, fixed or contingent;

(3) "consideration" shall include evidences of indebtedness, either secured or unsecured, stock and certificates of beneficial interest therein, and certificates of beneficial interest in property; (4) "executory contracts" shall include unexpired leases of real property;

(5) "creditors" shall mean the holders of claims;

(6) "debtor" shall mean a person, other than a corporation as defined in this Act, who could become a bankrupt under section 4 of this Act, who files a petition under this chapter and who is the legal or equitable owner of real property or a chattel real which is security for any debt, but shall not include a person whose only interest in property proposed to be dealt with by the arrangement is a right to redeem such property from a sale had before the filing of such petition;

(7) "debts" shall include all claims;

(8) "indenture trustee" shall mean a trustee under a mortgage, deed of trust, or indenture, pursuant to which there are securities outstanding, other than voting trust certificates, constituting debts against a debtor or debts secured by a lien upon real property or a chattel real of which such debtor is the legal or equitable owner; and

(9) "petition" shall mean a petition filed under this chapter proposing an arrangement by a debtor.

(6) extends the jurisdiction of the bankruptcy court to the date of actual sale. Section 74 stated that proceedings thereunder "shall not affect any proceeding in any court in which a final decree has been entered." "Final decree" was construed to include a decree of foreclosure and sale. In re Sorenson, 77 F.2d 166 (C.C.A. 7th, 1935).

Sec. 407. (11 U.S.C. § 807.) Creditors Affected by Arrangement; Determination

Creditors or any class thereof shall be deemed to be "affected" by an arrangement only if their or its interest shall be materially and adversely affected thereby. In the event of controversy, the court shall after hearing upon notice summarily determine whether any creditor or class is so affected.

Article III-Jurisdiction, Powers, and Duties of the Court

Sec. 411. (11 U.S.C. § 811.) Exclusive Jurisdiction of Debtor and Property

Where not inconsistent with the provisions of this chapter, the court in which the petition is filed shall, for the purposes of this chapter, have exclusive jurisdiction of the debtor and his property, wherever located.

Sec. 412. (11 U.S.C. § 812.) Jurisdiction, Power and Duties Where not inconsistent with the provisions of this chapter, the jurisdiction, powers, and duties of the court shall be the same

(1) where a petition is filed under section 421 of this Act, as if a decree of adjudication had been entered in the bankruptcy proceeding at the time the petition under this chapter was filed; and

(2) where a petition is filed under section 422 of this Act, as if a voluntary petition for adjudication in bankruptcy had been filed and a decree of adjudication had been entered at the time the petition under this chapter was filed.

Sec. 413.

(11 U.S.C. § 813.)

Same; Administration of Estate Upon the filing of a petition, the court may, in addition to the jurisdiction, powers, and duties hereinabove and elsewhere in this chapter conferred and imposed upon it—

(1) permit the rejection of executory contracts of the debtor, upon notice to the parties to such contracts and to such other parties in interest as the court may designate;

(2) upon such notice as the court may prescribe and upon cause shown, authorize the trustee or debtor in possession to lease or sell any property of the debtor, whether real or personal, upon such terms and conditions as the court may approve;

(3) whenever under this chapter the court is required or permitted to fix a time for any purpose, the court may upon cause shown extend such time.

Sec. 414.

(11 U.S.C. § 814.) Stay of Actions

The court may, in addition to the relief provided by section 11 of this Act and elsewhere under this chapter, enjoin or stay until final decree the commencement or continuation of suits against a debtor and may, upon notice for cause shown, enjoin or stay until final decree any act or the commencement or continuation of any proceeding to enforce any lien upon any property of a debtor.

Sec. 415. (11 U.S.C. § 815.) Notices

Whenever notice is to be given under this chapter, the court shall designate, if not otherwise specified hereunder, the time

within which, the persons to whom, and the form and manner in which the notice shall be given. Any notice to be given under this chapter may be combined, whenever feasible, with any other notice or notices under this chapter.

Sec. 416. (11 U.S.C. § 816.) Appellate Jurisdiction

Where not inconsistent with the provisions of this chapter, the jurisdiction of appellate courts shall be the same as in a bankruptcy proceeding.

Article IV-Petition and Stay

Sec. 421. (11 U.S.C.

(11 U.S.C. § 821.) Filing Petition; Pending Bankruptcy Proceeding

A debtor may file a petition under this chapter in a pending bankruptcy proceeding before his adjudication.

Sec. 422. (11 U.S.C. § 822.) Same; Original Petition

If no bankruptcy proceeding is pending, a debtor may file an original petition under this chapter with the court which would have jurisdiction of a petition for his adjudication.

Under section 74, which lacked such a provision, the debtor was often enabled to delay unreasonably the presentation of his proposals.

Sec. 423. (11 U.S.C. § 823.)

Contents of Petition

A petition filed under this chapter shall state that the debtor is insolvent or unable to pay his debts as they mature, and shall set forth the terms of the arrangement proposed by him.

Sec. 424. (11 U.S.C. § 824.) Statement and Fees to Accompany Petition

The petition shall be accompanied by

(1) a statement of the executory contracts of the debtor, and the schedules and statement of affairs, if not previously filed: Provided, however, That if the debtor files with the petition a list of his creditors and their addresses and a summary of his assets and liabilities, the court may, on application by the debtor, grant for cause shown further time, not exceeding ten days, for filing the statement of the executory contracts and the schedules and statements of affairs, and such time shall not further be extended except for cause shown and on such notice and to such persons as the court may direct; and

(2) payment to the clerk of the fees, if not already paid, required by this Act.

The provisions for the extension of time were introduced by the amendment of July 7, 1952, P.L. 456, 82d Cong., 2d Sess., § 41. See note to section 324 ante.