The opinion of the court was delivered by: Robert D. Morgan, District Judge:
This matter comes on to be heard upon the petition of Barry M.
Barash, Trustee of the captioned bankrupt estates, for review of
a decision issued in said cases by Stephen J. Covey, Referee in
Bankruptcy of this Court, on February 27, 1969, and said
Referee's Certificate of Review filed pursuant to said petition
on March 7, 1969. The Court has considered such certificate and
scholarly briefs submitted on behalf of said trustee, as well as
on behalf of the bankrupts, has heard the arguments of counsel,
and is fully advised in the premises.
The Referee's writen decision clearly and succinctly sets forth
the pertinent facts and the rationale of his decision as follows:
"IDA BELLE HENDRICKS and JAMES R. HENDRICKS, husband and wife
were adjudicated bankrupts on October 15, 1968. On the date of
bankruptcy, the bankrupts owned the following described property
as joint tenants and not as tenants in common and resided in it
together as husband and wife with their children:
"Said property is subject to a mortgage in favor of the Farmers
and Mechanics Bank, of Galesburg, Illinois, and the value of the
real estate exceeds the amount of the mortgage by $1800.00. In
their bankruptcy schedules filed herein, both bankrupts claimed a
exemption in said real estate pursuant to Chapter 52, Section 1
of the Illinois Revised Statutes. On December 4, 1968, BARRY M.
BARASH was appointed Trustee in both cases and on December 6,
1968, he filed the instant petition in both cases asking that
this Court determine the proper allowance and allocation of the
"Chapter 52, Section 1, of the Illinois Revised Statutes
provides as follows:
`1. AMOUNT 1. Every householder having a family,
shall be entitled to an estate of homestead, to the
extent in value of $5,000, in the farm, or lot of
land and buildings thereon, owned or rightly
possessed, by lease or otherwise, and occupied by him
or her as a residence; and such homestead, and all
right and title therein, shall be exempt from
attachment, judgment, levy or execution, sale for the
payment of his debts, or other purposes, and from the
laws of conveyance, descent and devise, except as
hereinafter provided. As amended by act approved
August 13, 1965. L. 1965 — H.B. No. 1075. Effective
Jan. 1, 1966.'
"Section 70 of the Bankruptcy Act provides in part as follows:
`70. TITLE TO PROPERTY. a. The Trustee of the estate
of a bankrupt and his successor or successors, if
any, upon his or their appointment and
qualifications, shall in turn be vested by operation
of law with the title of the bankrupt as of the date
of the filing of the petition initiating a proceeding
under this Act, except insofar as it is to property
which is held to be exempt, to all of the following
kinds of property wherever located. * * *'
"It has been clearly established in Illinois that where husband
and wife own property as joint tenants and reside together on the
premises that the husband is the householder contemplated by the
Statute and he alone is entitled to the homestead exemption. See
Johnson v. Muntz, 364 Illinois 482 [4 N.E.2d 826] where the Court
`* * * If the husband is living and residing with his
family he is the householder contemplated by the
statute and the homestead estate is vested in him.
(Taylor v. Taylor, 223 Ill. 423 [79 N.E. 139]; Brokaw
v. Ogle, 170 id. 115 [48 N.E. 394].) Two separate
homestead estates cannot co-extensively exist in the
same premises at the same time. * * *'
"See also DeMartini v. DeMartini, 385 Ill. 128 [52 N.E.2d 138],
where the Court said:
`* * * If the husband is living and residing with his
wife on premises owned by them, either as joint
tenants or tenants in common, the homestead estate is
vested in the husband alone. * * *'
"See also Morris Investment Co. v. Skeldon, 399 Ill. 506 [
78 N.E.2d 504].
"In the instant case, JAMES R. HENDRICKS is the householder and
is entitled to the homestead exemption.
"The next question to be determined is whether his exemption
extends to the entire property or is allowable only out of his
undivided one-half interest. If the former, then the entire
equity in the property is exempt, and under Section 70 of the
Bankruptcy Act, the Trustee would take no title to the property.
If, however, the homestead exemption is allowable only out of the
one-half interest of JAMES R. HENDRICKS, then the one-half
interest of his wife, IDA BELLE HENDRICKS would pass to the
Trustee in Bankruptcy and could be sold by him.
"From a careful reading of Paragraph 1, Chapter 52 of the
Illinois Revised Statutes, cited above, it seems clear that the
homestead interest of JAMES R. HENDRICKS extends to the entire
property and not to just his undivided one-half interest. Under
the Statute, the householder is given an estate of homestead not
only in land owned by him, but also land rightly possessed by
him. In the instant case, JAMES R. HENDRICKS as a joint tenant
is rightly possessed of the entire property, and therefore his
homestead exemption extends to the entire property.
"In Johnson v. Muntz, cited above, the property was owned in
joint tenancy and the husband and wife resided together. On page
488 [4 N.E.2d 826] the Court said:
`We must conclude that in the case before us,
Johnson, the husband, was the householder; that his
homestead estate was a burden upon the several
moieties, * * *'
See also Brod v. Brod, 390 Ill. 312 [61 N.E.2d 675], where the
Court said on page 322:
`After a review of the previous holdings, we held
that Johnson, the husband, was the householder as
contemplated in the act; that his homestead estate
was a burden upon the several moieties, and that its
value was to the extent of $1000 and it could be
released only in the manner prescribed by statute. *
"In In Re Miller, 27 F. Supp. 999, the District Court for the
Southern District of California, had before it the same question
presented in the instant case. It was construing the California
Exemption Statute, which is similar in purpose to the Illinois
Statute. The Court said on page 1001 as follows:
`(6) We conclude by holding that under the record no
part of the homesteaded property passed to the
trustee in bankruptcy, and that any ratable
apportionment of the homestead exemption between
husband and wife is unauthorized by law. The entire
property described in the joint tenancy deed of May
21, 1927, and in the declaration of homestead
recorded August 31, 1932, is exempt under the laws of
the state of California, and the trustee in
bankruptcy is entitled to no interest in said
"The Trustee contends that the homestead exemption should be
allowed only out of the one-half interest of the husband, and
relies primarily on the case of In The Matter of CHARLES KENNETH
CLIFFORD, No. P BK 67 540, in the United States District Court
for the Southern District of Illinois, Northern Division.
(Original decision by Referee — affirmed by U.S. District Judge)
In that case there was property owned in joint tenancy which had
an equity of $8,000.00. Only the husband was in bankruptcy and
his undivided one-half interest in the property was therefore,
worth $4,000.00. The Trustee filed a petition to sell this
one-half interest and to pay the bankrupt $2,500.00 out of the
proceeds. It was the Trustee's contention that the other
$2,500.00 exemption was to be paid out of the wife's one-half
interest. This Court denied the petition of the Trustee to sell.
In the Opinion this Court said:
`While these cases are not directly in point in
regard to the instant case, they do establish a clear
policy of preventing creditors or a Trustee in
Bankruptcy from seizing an interest in real estate in
which there is a homestead right, unless the property
can be sold for enough to pay the value of the
homestead exemption. * * *'
In the Clifford Case, only the bankrupt's one-half interest in
the property was subject to the jurisdiction of this Court, and
since it could not be sold for more than $5,000.00, title to the
property did not pass to the Trustee in Bankruptcy.
"In the instant case, the combined interest of the husband and
wife are within the jurisdiction of this Court. These interests
cannot be sold for more than $5,000.00 and, therefore, no title
passes to the Trustee. The general purpose and policy of the
homestead exemption is to protect the householder and his family
from the misfortunes of life and to provide them with a home to
the extent of $5,000.00. If the property cannot be sold for more
than $5,000.00 then it cannot be sold at all.
"In Brod v. Brod, cited above, the Supreme Court of the State
of Illinois said:
`The law and public policy of this State, as
exemplified by section 1 of the Homestead Exemption
Act above quoted,
section 16 of the act concerning husband and wife,
(Ill.Rev.Stat. 1943, chap. 68, par. 16,) section 27
of the act concerning conveyances, (Ill.Rev. Stat.
1943, chap. 30, par. 26,) and the many decisions in
this State thereunder, have been and are to insure to
the family the possession and enjoyment of a home. *
On the basis of this analysis, with which this Court concurs
fully, the Referee has held that James R. Hendricks has a
homestead exemption in the subject real estate which extends to
both undivided half interests in the jointly owned and occupied
property; and that the Trustee takes no interest therein.
It is ordered that the Opinion and Order of Referee Stephen J.
Covey, dated February 27, 1969, be and the same is hereby
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