In re Kossack

• Citation: 113 F. Supp. 884
• Decision Date: 30 July 1953
• Docket Number: No. 53801.,53801.
• Parties: In re KOSSACK.
• Court: U.S. District Court — Southern District of California

113 F. Supp. 884

In re KOSSACK.

No. 53801.

United States District Court S. D. California, Central Division.

July 30, 1953.

COPYRIGHT MATERIAL OMITTED

Jack Altman, Los Angeles, Cal., for bankrupt.

Albert A. Dorn, Los Angeles, Cal., for trustee.

MATHES, District Judge.

Bankrupt petitions for review of an order of the referee overruling bankrupt's objections to the trustee's report of exempt property.

On March 10, 1952 bankrupt was adjudged upon his voluntary petition that day filed, in which he claimed as exempt the residential property described in a "Declaration of Homestead" which had been "executed" by him and his wife on a printed form in the manner hereinafter detailed, and recorded on February 3, 1948 in the office of the County Recorder of Los Angeles County.

In due course the trustee in bankruptcy filed his report of exempt property pursuant to General Order 17, 11 U.S.C.A. following § 53, in which the trustee declared his refusal to list or set apart as exempt the residential property thus claimed as a homestead, "for the reason that the Declaration of Homestead * * * is not properly executed under the law." See Bankruptcy Act § 47, sub. a(6), 11 U.S. C.A. § 75, sub. a(6).

Within the permitted ten-day period bankrupt filed objections to this determination of the trustee. Gen. Order 17(2), 11 U.S.C.A. following § 53. Upon the issues thus joined a hearing was had, following which the referee concluded that the "Declaration of Homestead * * * was not executed * * * in accordance with law," and entered the order under review.

Whether a bankrupt is entitled to have set aside for his benefit such exemptions as state law permits is governed by federal bankruptcy law, Bankruptcy Act §§ 6, 47, sub. a(6); 11 U.S.C.A. §§ 24, 75, sub. a(6); Prudence Realization Corp. v. Geist, 1942, 316 U.S. 89, 95, 62 S.Ct. 928, 86 L.Ed. 1293; Deitrick v. Greaney, 1940, 309 U.S. 190, 200-201, 60 S.Ct. 480, 84 L.Ed. 694; Gardner v. Johnson, 9 Cir., 1952, 195 F.2d 717, 719; but the nature and extent of the exemptions which a bankrupt may claim and the procedure for perfecting such exemptions are governed by state law. White v. Stump, 1924, 266 U.S. 310, 45 S.Ct. 103, 69 L.Ed. 301; Turnbeaugh v. Santos, 9 Cir., 1944, 146 F.2d 168; In re Dudley, D.C.S.D.Cal.1947, 72 F.Supp. 943.

The sole question here is whether or not bankrupt executed a valid declaration of homestead under California law. See Cal.Civ.Code § 1262; cf. id. § 1091. If so, § 6 of the Bankruptcy Act, 11 U.S. C.A. § 24, unquestionably accords him the exemption provided by the Homestead Law of California. Cal.Civ.Code, § 1237 et seq. See Haskins, Homestead Exemptions, 63 Harv.L.Rev. 1289, 1315-1319 (1950).

Section 1262 of the Civil Code of California requires that: "In order to select a homestead, the husband * * * must execute and acknowledge, in the same manner as a grant of real property is acknowledged, a declaration of homestead, and file the same for record."

The challenged instrument at bar consists of a printed form of "Declaration of Homestead" comprising a single sheet and containing on each side various printed provisions and appropriate blank spaces for names, description of property, value and date, together with two blank lines for signature at the foot or end of the front of the page, followed by the customary form of joint notarial acknowledgment at the top of the reverse side. Immediately following this form of acknowledgment is a form of verification and two blank lines for signature, with a notarial jurat form below and to the left.

The attestation clause is filled in to read:

"In Witness Whereof, we have hereunto set our hands this 17th day of October, 1947.

"Signed W. A. Gallagher "Notary Public"

Then follows at the top of the reverse side of the page this completed notarial certificate of acknowledgment:

"State of California, | > SS County of Los Angeles |

"On This 17 day of October, A.D. 1947, before me, W. A. Gallagher, a Notary Public in and for said County, personally appeared Ben A. Kossack and Shirley S. Kossack, his wife, known to me to be the persons whose names are subscribed to the within instrument, and severally acknowledged to me that they executed the same.

"Witness my hand and official seal the day and year in this certificate first above written.

"Signed W. A. Gallagher "Notarial Seal Notary Public in and for said County and State."

Immediately below the certificate of acknowledgment the following verification is set forth:

"State of California, | > SS County of Los Angeles |

"Ben A. Kossack and Shirley S. Kossack, husband and wife, each, being first duly sworn, deposes and says: That he/she is one of the declarants in the foregoing declaration of homestead; that he/she has read the foregoing declaration and knows the contents thereof, and that the matters therein stated are true of his/her own knowledge.

"Signed Ben A. Kossack "Signed Shirley S. Kossack

"Subscribed and Sworn to before me this 17 day of October, 1947.

"Signed W. A. Gallagher "Notary Public in and for said County and State. Notarial Seal "Comm. Exp. 10/2/49"

It thus appears beyond dispute that the notary signed the attestation clause at the foot or end of the declaration proper, and completed the notarial certificate of acknowledgment; while bankrupt and his wife signed and made oath to the verification form beneath.

No question has been raised as to the sufficiency of form or content of the body of this "Declaration of Homestead"; form and content of the declaration proper admittedly meet all requirements of California law. See Cal.Civ.Code § 1263. Moreover, where as here a verification contains the necessary information, it may also serve as an acknowledgment. Favello v. Bank of America, 1938, 24 Cal.App.2d 342, 74 P.2d 1057; see Thomas v. Speck, 1941, 47 Cal.App.2d 512, 518, 118 P.2d 365, 368.

So the only real problem before the referee was whether the declaration was "executed" as required by the statute. Cal. Civ.Code § 1262. The verb "execute," as employed in the quoted provisions of § 1262 of California's Civil Code, is a word of art. "The execution of an instrument is the subscribing and delivering it * * *." Cal.Code Civ.Proc. § 1933.

The referee found that the declaration was not "executed," since "the declarants (bankrupt and wife) did not place their signatures at the end of the purported Declaration of Homestead."

The referee further found "from an examination and inspection of the instrument in question, its language as well as its form and the relative position of its parts, that the signatures of the declarants * * * in the verification clause * * * were placed as they were only for the purpose of verifying the instrument in question, and not for the purpose of executing the same."

However, the referee refused to receive any evidence dehors the questioned document, as to the intent or purpose with which the purported declarants placed their signatures in the spaces provided at the end of the verification. It is this exclusion of parol evidence which is urged as ground for reversal.

Since adoption of the Codes in 1872, California's parol evidence rule has remained unchanged:

"When the terms of an agreement have been reduced to writing by the parties, it is to be considered as containing all those terms, and therefore there can be between the parties and their representatives, or successors in interest, no evidence of the terms of the agreement other than the contents of the writing, except in the following cases:

"1. Where a mistake or imperfection of the writing is put in issue by the pleadings;

"2. Where the validity of the agreement is the fact in dispute. But this section does not exclude other evidence of the circumstances under which the agreement was made or to which it relates, as defined in section eighteen hundred and sixty, or to explain an extrinsic ambiguity, or to establish illegality or fraud. The term agreement includes deeds and wills, as well as contracts between parties." Cal.Code Civ. Proc. § 1856.

The formal requisites for a valid declaration of homestead are in substance identical with those attendant upon a grant of real property, see Cal.Civ.Code §§ 1262-1265, 1091, 1092, 1053, 1056, so the statute declaring the parol evidence rule is applicable to a declaration of homestead as well as a deed. Hence, "evidence * * * other than the contents of the writing" is admissible as to a declaration of homestead, where "the validity of the * * * declaration is the fact in dispute", Cal.Code Civ.Proc. § 1856, and the requirements of the Statute of Frauds have been met. See Ellis v. Klaff, 1950, 96 Cal.App.2d 471, 216 P.2d 15.

The requirements of the Statute of Frauds are that: "No estate or interest in real property * * * can be created, granted * * * or declared, otherwise than by * * * a conveyance or other instrument in writing, subscribed by the party creating, granting * * * or declaring the same * * *." Cal.Code Civ. Proc. § 1971. See also Cal.Civ.Code §§ 1624-1627; Cal.Code Civ.Proc. §§ 1973, 1973a.

Since the verb "subscribed" is not a word of art under California law, "The statute of frauds does not demand that the signature of the party to be charged be placed at the end of the writing relied upon if a proper signature be found elsewhere on the instrument. * * * Furthermore the signature need not be manually affixed, but may in some cases be printed, stamped or typewritten." Marks v. Walter G. McCarty Corporation, 1949, 33 Cal.2d 814, 820, 205 P.2d 1025, 1028. See also McNear v. Petroleum Export Corporation, 1929, 208 Cal. 162, 280 P. 684; California Canneries Co. v. Scatena, 1897, 117 Cal. 447, 49 P. 462; Little v. Union Oil Co. of California, 1925, 73 Cal. App. 612, 618, 238 P. 1066, 1068. Compare e. g. Geist v. O'Connor, D.C.D.Alaska, 1950, 92 F.Supp. 451; Commercial Credit Corporation v. Marden, 1936, 155 Or. 29, 62 P.2d 573, 112 A.L.R. 931. Because of this broad interpretation, a phrase...