In re Rollins Boot Shop, 67.

• Decision Date: 18 February 1928
• Docket Number: No. 67.,67.
• Citation: 24 F.2d 422
• Parties: In re ROLLINS BOOT SHOP.
• Court: U.S. District Court — Northern District of Georgia

24 F.2d 422 (1928)

In re ROLLINS BOOT SHOP.

No. 67.

District Court, N. D. Georgia, Gainesville Division.

February 18, 1928.

Joseph G. Collins, of Gainesville, Ga., for bankrupts.

J. L. Hargrove, of Atlanta, Ga., and C. L. Williamson, of Gainesville, Ga., for objecting creditors.

SIBLEY, District Judge.

The partners, Rollins and Jordan, each, in their bankruptcy schedules, claimed a $1,600 homestead under the Georgia Constitution, to be set apart partly in specific personal property, and the remainder to be cash from the partnership stock of merchandise. The stock had been inventoried by the trustee at its cost price, amounting to about $5,800; this also being the value placed on it in the bankruptcy schedule. It was appraised for sale, however, at only $1,700. The trustee construed these claims for an exemption of cash as a consent by the bankrupt to the sale of the stock. A sale was had, the stock bringing $2,110. This sum being insufficient to pay the remainder of the homesteads in full, it was prorated by the trustee between the two claims of homestead. The referee, on the authority of In re Arnold (D. C.) 169 F. 1000, held that the exemptions must stand their proportion of the shrinkage on sale from the inventory value, being about 65 per cent., and should be reduced accordingly. The evidence before the referee showed that the stock had been damaged by fire; that the inventory made by the trustee was at original cost, with no effort by him to fix the present value. The referee's decision is under review.

The trustee takes no title to exempt property. His only power over it is to value it and set it aside. The bankruptcy court has no jurisdiction to administer it otherwise without the bankrupt's consent. On the other hand, the bankrupt has no right to demand an exemption in cash. The Georgia laws contemplate a provision for the debtor's family in permanent property. The kinds of property that can be exempted are particularly specified in the "short homestead," and do not include money. Code Ga. § 3416. The constitutional homestead here involved is more general, being "realty or personalty, or both, to the value in the aggregate of sixteen hundred dollars." Code Ga. § 3377. The homesteader, in his application, must state "out of what and whose property exemptions are claimed." Code Ga. § 3378, subsec. 1. If indivisible town realty must be sold in order to sever the homestead, the cash arising from the sale must be invested. Code Ga. § 3389. And investment is required if the estate be in cash to begin with. Code Ga. § 3391. "In no case shall the allowance of cash without such investment be a valid exemption." Id. Such investment is not within the province of the bankruptcy court, and must be left to the state tribunal, should the bankrupt or his family desire so to perfect the exemption. It is evident, however, that the bankrupt has no right to demand a cash exemption unless the estate be originally in cash, or unless it is necessary to sell indivisible property to...