White v. Stump
| Decision Date | 24 November 1924 |
| Docket Number | No. 20,20 |
| Citation | 266 U.S. 310,69 L.Ed. 301,45 S.Ct. 103 |
| Parties | WHITE v. STUMP |
| Court | U.S. Supreme Court |
Mr. James E. Babb, of Lewiston, Idaho (Tannahill & Leeper, of Lewiston, Idaho, on the brief), for petitioner.
Mr. Harve H. Phipps, of Spokane, Wash., for respondent.
Peter Stump was adjudged a bankrupt on his voluntary petition, which was accompanied by the usual schedules. Among the assets listed was a quarter section of land on which he and his family had been and were residing; but nothing was said at the time about a homestead exemption. Two months later the bankrupt's wife, with his assent, asked that the land be set apart as an exempt homestead for their joint benefit. The trustee objected and on a hearing the exemption was disallowed by the referee. On review that ruling was reversed by the District Court, and on petition for revision the reversal was sustained by the Circuit Court of Appeals. 284 F. 199. The case is here on certiorari.
The laws of the state of Idaho, where the land is situate, provide for a homestead exemption, but only where a declaration that the land is both occupied and claimed as a homestead is made and filed for record as therein prescribed. If the family consist of husband and wife, whether with or without children, either may make the declaration. It 'must' be executed and acknowledge like a conveyance of real property and 'must' be filed for record in the office of the county recorder. The exemption arises when the declaration is filed, and not before. Up to that time the land is subject to execution and attachment like other land; and where a levy is affected while the land is in that condition the subsequent making and filing of a declaration neither avoids the levy nor prevents a sale under it. Comp. Stat. Idaho 1919, §§ 5441, 5462-5465; Smith v. Richards, 2 Idaho (Hasb.) 498, 21 P. 419; Wright v. Westheimer, 3 Idaho, (Hasb.) 232, 28 P. 430, 35 Am. St. Rep. 269; Law v. Spence, 5 Idaho, 244, 48 P. 282; Burbank v. Kirby, 6 Idaho, 210, 55 P. 295, 96 Am. St. Rep. 260.
Here no declaration was made and filed for record until a month after Stump's petition in bankruptcy was filed and he was adjudged a bankrupt. A declaration was then made and filed by his wife for their joint benefit. Whether in these circumstances there was such a right to a homestead exemption as could be recognized and allowed in the bankruptcy proceeding is the question for decision.
The District Court gave an affirmative answer in deference to the decision of the Circuit Court of Appeals for that circuit in Brandt v. Mayhew, 218 F. 422, 134 C. C. A. 210, a case arising in California, in which it was held, one judge dissenting, that a bankrupt is not precluded from claiming a homestead as exempt merely because, when the petition in bankruptcy is filed, he has not done all that is required by the state law to entitle him to the exemption, but may rightfully demand that the exemption be allowed where he has met the requirements of the state law within a reasonable time after the filing of the petition. The Circuit Court of Appeals adhered to that decision, and therefore sustained the action of the District Court. Other courts in which the question has arisen have regarded the bankruptcy law as meaning that the right to such an exemption must be tested by the situation existing when the petition in bankruptcy is filed, and have held that where the land is not then exempt under the state law it passes to the trustee for the benefit of the creditors. In re Youngstrom, 153 F. 98, 82 C. C. A. 232; Edgington v. Taylor (C. C. A.) 270 F. 48; In re Lehfeldt (D. C.) 225 F. 681.
The Bankruptcy Law does not directly grant or define any exemptions, but directs, in section 6 (Comp. St. § 9590), that the bankrupt be allowed the exemptions 'prescribed by the state laws in force at the time of the filing of the petition'; in other words, it makes the state laws existing when the petition is filed the measure of the right to exemptions. It further provides that a voluntary bankrupt shall claim the exemptions to which he is entitled in a schedule filed 'with the petition,' and an involuntary bankrupt shall claim his in...
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