## Facts

- Adana Mortgage Bankers, Inc. (Adana) operated as a mortgage banker that purchased mortgage loans and grouped them into pools.
- Adana contracted with the Government National Mortgage Association (GNMA) to issue mortgage-backed securities that GNMA guaranteed.
- Adana and GNMA entered into guaranty agreements governing each securities transaction, setting out Adana’s duties as issuer and GNMA’s obligations as guarantor.
- The guaranty agreements included a default provision requiring Adana to give GNMA advance notice of any bankruptcy filing; if Adana failed to do so, GNMA could declare Adana in default.
- In February 1981, Adana filed a Chapter 11 petition without providing GNMA the contractually required advance notice.
- In March 1981, after the bankruptcy filing, GNMA sent written demands to Adana’s “line banks” directing them to turn over all of Adana’s funds.
- GNMA did not notify Adana or the bankruptcy court before sending the demand letters.
- The line banks refused to comply without a bankruptcy court order.
- Adana moved for contempt against GNMA, asserting GNMA’s postpetition demand letters violated the automatic stay.
- GNMA responded that Adana’s bankruptcy petition was void because Adana failed to give GNMA advance notice as required by the guaranty agreements.

## Issues

1. Whether Adana’s Chapter 11 petition was void, and the automatic stay ineffective, because Adana failed to provide GNMA advance notice of the filing under the guaranty agreements.
2. Whether GNMA’s postpetition demand letters to Adana’s line banks seeking turnover of Adana’s funds were prohibited acts to obtain or control estate property under 11 U.S.C. § 362(a).
3. Whether the bankruptcy court could address the alleged stay violation through contempt and related remedial relief.

## Decision

- The court rejected GNMA’s argument that the bankruptcy petition was void based on Adana’s failure to provide prepetition notice required by contract.
- The court held that the automatic stay arose upon the Chapter 11 filing as a matter of federal law and could not be negated by a private agreement’s notice/default clause.
- The court determined GNMA’s postpetition written demands to the line banks, seeking to obtain Adana’s funds without court permission, violated the automatic stay.
- The court granted Adana relief on its contempt motion based on the stay violation and directed that GNMA’s conduct be remedied through the court’s enforcement powers.

## Legal Principles

- A debtor’s access to bankruptcy relief and the automatic stay is created by federal statute; private contract terms cannot make a bankruptcy petition “void” or prevent the stay from taking effect once a petition is filed.
- The automatic stay bars postpetition efforts—direct or indirect—to obtain possession of, or exercise control over, property of the estate, including attempts to compel third parties (such as banks) to turn over debtor funds without court authorization.
- A counterparty that believes it has contractual or regulatory rights against the debtor after a bankruptcy filing must seek relief in the bankruptcy court rather than use unilateral postpetition demands.
- Bankruptcy courts may enforce the automatic stay through contempt-type remedies designed to stop prohibited conduct and address harm caused by stay violations.

## Conclusion

In re Adana Mortgage Bankers, Inc. held that Adana’s failure to give GNMA advance contractual notice did not void Adana’s Chapter 11 filing or prevent the automatic stay from arising, and that GNMA’s postpetition demand letters to Adana’s line banks seeking turnover of Adana’s funds violated the stay, warranting enforcement through the bankruptcy court’s contempt and remedial powers.


In re Adana Mortgage Bankers, Inc., 12 B.R. 989 (1981)