Stotler

The appellees, owners and operators of the Ilumpty Dumpty Inn in Long Beach, upon their voluntary petitions, were adjudged bankrupts on May 5,1952. Prior thereto in December, 1950, they had executed and recorded in the office of the County Recorder of Los Angeles County a Declaration of Homestead which read in its entirety as follows:

In the bankruptcies, which were consolidated, the Stotlers asserted that their real estate described in the declaration was exempt property under California law and an exemption which should be recognized as against the trustee and the bankrupts’ creditors.

The trustee and the referee denied the exemption, holding the declaration too incomplete to be legally effective. Their main objection to the instrument was that Section 1263 of the California Civil Code provides, inter alia, that a declaration of homestead must contain “an estimate of their [the premises] actual cash value” and, so the trustee and referee said, this requirement had not been met; therefore, no valid declaration had been made.

The bankruptcy schedules reported the real estate, asserted its exemption under California law and listed the property as having no value “above the…