In re Sanderson

This is a petition for review of a referee’s order sustaining objections to the trustee’s report of exempt property. By his order, the referee set aside to the bankrupt three items of property which are here challenged. They raise different questions and are separately discussed.

*485 The first item is a homestead exemption allowance in the amount of $12,-500. There is no question about the proper declaration of the homestead. The issue between the trustee and bankrupt arises out of the fact that the homestead exemption allowance provided by California before September 1, 1953, was in the amount of $7,500, which amount was raised on that date to $12,-500. California Civ.Code, § 1260. Some of the bankrupt’s creditors became such before September 1, 1953, however, and under the law of California, these creditors are restricted only by the amount of the homestead allowance in force at the time of the contraction of the debt, In re Rauer’s Collection Co., 1948, 87 Cal. App.2d 248 , 196 P.2d 803 , or $7,500. From this, the trustee argues that by virtue of the provisions of Section 70, sub. c of the Bankruptcy Act, 11 U.S. C.A. § 110, he is entitled to proceed in the shoes of any…