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98 F. 582

In re Barrow

Virginia Western District Court

Decided December 16, 1899.)

Virginia Western District Court · decided 1899-12-16

<p>1. BANKRUPTCY — ASSETS—GROWING CROPS.</p> <p>Where a bankrupt is tenant of a farm under a contract reserving to the landlord, as rent, one-fourth of the crops raised on the land, the bankrupt’s interest in growing crops, though they are immature and unsevered at the time of filing his petition in bankruptcy, is property which he might have transferred at that date, within the meaning of Bankr. Act 1898, § 70a, subd. 5, and therefore vests in his trustee as assets of his estate in bankruptcy; and after the crops have been severed the bankrupt must surrender the same to his trustee, or account for the proceeds.</p> <p>3. Same — Crops Gathered after Adjudication — Compensation of Bankrupt.</p> <p>Where a bankrupt who has an interest in growing crops omits to list the same in his schedule of assets, not from any fraudulent design, but because he was advised that they would not pass to his trustee, and completes their cultivation and harvesting after his adjudication in bankruptcy, and is then ordered to surrender the crops, or the proceeds of their sale, to the trustee, he will be allowed a reasonable compensation for work and care bestowed on them from the date of the adjudication.</p>

2 counsel of record

Key passage — most relied on by later courts

““By the terms of the policy he was entitled to receive at the end of the tontine period the cash payment stipulated in the contract. That is a vested contract right, contingent only upon his surviving the tontine period. The right is valuable, increasing in value with each successive payment of premium. The policy, technically, had not a ‘surrender value,’ within the meáning of the proviso; but it had an actual value, and that valuable right was right of property existing in the bankrupt. It is the plain provision of the bankruptcy law that all the estate of the bankrupt shall by operation of law, be vested in the trustee, save such as is specifically excepted by the provisions of the bankruptcy law, or by the law of the domicile of the bankrupt. The language of the provision is comprehensive. Subdivision 5 of section 70a declares that there shall be thus vested in the trustee ‘property which prior to the filing of the petition he could by any means have transferred or which might have been levied upon and sold under .-judicial process against him.’ Then fpliows the proviso• which we have considered. It is clear that this proviso merely defines a certain class of insurance which may be excepted and exempted, by the action of the bankrupt and upon the conditions stated, from the general property which by the law is vested in the 'trustee. In other words the proviso is in the nature of a privilege to the debtor to retain such specified insurance upon yielding to the trustee the”

quoted by 1 later decision, including Partridge v. Andrews

““ 'Transfer' shall include the sale and every other different mode of disposing of or parting with property, or the possession of property, absolutely or conditionally, as a payment, pledge, mortgage, gift, or security.””

quoted by 1 later decision, including Partridge v. Andrews

Good law ✅— No negative treatment on recordhow we know

Decided 1899-12-16

How this case has been cited

Cited by 5 later decisions — most recently February 1938

1 federal appellate · 2 district ·

2018991900191019201930decided

Later decisions citing this case, by decade. The current decade is in progress, and our corpus holds fewer opinions from the most recent years, so the latest bars are undercounted — not a real decline.

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¶11. BANKRUPTCY — ASSETS—GROWING CROPS.

¶2Where a bankrupt is tenant of a farm under a contract reserving to the landlord, as rent, one-fourth of the crops raised on the land, the bankrupt’s interest in growing crops, though they are immature and unsevered at the time of filing his petition in bankruptcy, is property which he might have transferred at that date, within the meaning of Bankr. Act 1898, § 70a, subd. 5, and therefore vests in his trustee as assets of his estate in bankruptcy; and after the crops have been severed the bankrupt must surrender the same to his trustee, or account for the proceeds.

¶33. Same — Crops Gathered after Adjudication — Compensation of Bankrupt.

¶4Where a bankrupt who has an interest in growing crops omits to list the same in his schedule of assets, not from any fraudulent design, but because he was advised that they would not pass to his trustee, and completes their cultivation and harvesting after his adjudication in bankruptcy, and is then ordered to surrender the crops, or the proceeds of their sale, to the trustee, he will be allowed a reasonable compensation for work and care bestowed on them from the date of the adjudication.

¶5In Bankruptcy. On review of decision of referee in bankruptcy.

¶6Chas. B. Bryant, for bankrupt.

¶7John W. Garter, for creditors.

¶8PAUL, District Judge.

¶9The certificate of the referee in this matter, giving a summary of the evidence, as required by rule 27, General Orders in Bankruptcy, shows the following material facts:

“The bankrupt filed his petition September 1, 1899, and was adjudicated a bankrupt September 2d. The first meeting of creditors was held September 30, and was adjourned to October 10, 1899. At the adjourned meeting, at the instance of certain creditors, the bankrupt was examined as to the property owned by him at the time of filing his petition. From this examination it appeared that he was a tenant farmer on leased premises, under a contract with rent reserved, of one-fourth of the crops produced; that at the time of filing his petition he had growing- crops of corn and tobacco, which he omitted from his schedules of property; that the omission was not with intent to defraud his creditors, or to conceal his true financial condition, but because he was advised that the bankrupt act did not require the listing of crops growing, immature, and unsevered at the time of filing his petition”; that subsequent to his adjudication he had gathered these crops, and had them in possession, except part of the corn crop, which he had sold.

¶10A trustee was appointed, and the referee required the bankrupt, under section 39, subsecs. 2, 6, to amend his schedule so as to include these crops.

¶11On the question whether a bankrupts growing crops, immature and unsevered at the time of filing his petition, are to be surrendered by him, and administered by the trustee as part of the bankrupt estate, the referee held they are not. The contention of the creditors that these crops passed to the trustee must be determined by the provisions of section 70a, Bankr. Act 1898. It provides:

“The trustee of the estate of a bankrupt, upon his appointment and qualification, and his successor or successors, if he shall have one or more, upon his or their appointment and qualification, shall in turn be vested by operation of law with the title of the bankrupt, as of the date he was adjudged a bankrupt, *583except in so far as it is to property which is exempt, to all (1) «loenmenia relating to liis property; (2) interests in patents, patent rights, copyrights and trade-marks; (S) powers which he might have exercised for his own benefit, hut not those which he might have exercised for some other person; (4) property transferred by him in fraud of his cieditors; (51 property which prior to the filing' of the petition he could by any means have transferred, or which might have been levied upon and sold under judicial process against him; 5 * ' pj) rights of action arising upon contracts or from the unlawful taking or detention of, or injury to, his property.”

¶12These six subdivisions embrace every species of property and interests in property of which we can well conceive a man invested with ownership. The provision under subsection 5 (“property which prior to the tiling- of the petition he could by any means have transferred”) determines this question. It only remains to inquire whether a tenant farmer, having by his contract with his landlord a three-fourths interest in a crop of any kind, whether growing or matured, severed or unsevered, can by any means transfer bis interest therein. The ownership of property, whether the title be legal or equitable, carries with it the right of the owner to transfer his interest to another. The court does not concur in the view presented by counsel for the bankrupt, that an interest in a growing crop is an exception to this rule; that, by reason of the landlord having an interest of one-fourth in the crops, the tenant could not before the severance of the crops have transferred his interest of three-fourths therein. The contention cannot foe sustained on principle, and, so far as the court is informed, it is without the sanction of precedent. It is by no means unusual in this state for a tenant to sell, pledge, or mortgage his interest in growing crops, and his right to do so is as unquestionable as his right to dispose of any other property of which he is the owner. “Transfer” is a very comprehensive word in the common law. It embraces every transaction which passes over or conveys property to another. The bankrupt act of 1898 (section 3, subsec. 26) provides that “‘transfer’ shall include the sale and every other and «1 iff event modi' of disposition of property, absolutely or conditionally, as a payment, pledge, mortgage, gift or security.” The bankrupt’s interest in the crops being such that he could have transferred it before filing his petition, the title to such interest vested in the trustee as of the ditto of the adjudication. The trustee ⅛ entitled to immediate possession of the property, and the bankrupt must account for such part as he has disposed of.

¶13It appearing that the bankrupt did not omit these crops from his schedule with a fraudulent intent, he will be allowed by the trustee a reasonable compensation for the work and care bestowed on them from the date of his adjudication. The finding* of the referee is reversed.

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