First State Bank v. Roach

124 F.2d 325, 1941 U.S. App. LEXIS 4501
CourtCourt of Appeals for the Fifth Circuit
DecidedDecember 17, 1941
DocketNo. 10068
StatusPublished
Cited by7 cases

This text of 124 F.2d 325 (First State Bank v. Roach) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
First State Bank v. Roach, 124 F.2d 325, 1941 U.S. App. LEXIS 4501 (5th Cir. 1941).

Opinion

DAWKINS, District Judge.

This is an appeal from the over-ruling of a motion to dismiss the proceeding upon the allegation of creditors that the deceased was not a farmer under Section 75, sub. r, of the Bankruptcy Law, 11 U.S.C.A. § 203, sub. r.

Both the facts and law of this case are fully covered in the opinion of the lower court, which we approve and adopt as follows:

“This is an unusual farmer debtor proceeding in bankruptcy, presenting questions about which we have little authority to guide us. The petition was filed on the 22nd day of February, 1941, by Sammie E. Roach, as independent executrix of Lunnie Boney. Having failed in any efforts at composition or extension, the petitioner filed under subsec. s of Section 75, praying that the estate be adjudged a bankrupt. Pursuant thereto the customary steps were taken, and a reference made to the Honorable Perry S. Pearson as Referee for further proceedings under said section. On the 15th day of March, 1941, at the conclusion of the taking of the testimony at the first creditors’ meeting, the First State Bank of Stratford, Arthur Ross and W. A. Ross, each being creditors of Lunnie Boney, deceased, filed a motion to dismiss the proceeding, which was overruled by the Conciliation Commissioner. The matter is here to review that action.

“The first ground of the motion is that Lunnie Boney, at the time of her death, was not a farmer as defined in either Sec. 1, sub. 17, or Sec. 75, sub. r, of the Bankruptcy Act, 11 U.S.C.A. §§ 1(17), 203, sub. r. The Commissioner after hearing the facts, found that Lunnie Boney was a farmer at the time of her death. The evidence shows she owned the two sections of land upon which the creditors herein have liens, located in Dallam County, Texas, and in the years of 1929 and 1930 had same planted to wheat; that her hired hands did all of the work for her, they having no interest whatsoever in the crops; also, that she hired the machinery with which same was cultivated. During each of those years some wheat was harvested. Her personal labor in connection with the farming consisted largely of cooking for the thrasher hands. Likewise, she had wheat planted in the fall of 1931 for a 1932 wheat crop. This crop appears to have been a complete failure. She died April 5, 1932. The wheat year here in the Panhandle of Texas is usually from about the 1st of September to about the 10th of July of the following year. Whether a person is a farmer under the terms of the Bankruptcy Act is not determined by the success or failure of the farming venture for any particular year. Under these circumstances, Lunnie Boney was no less a farmer at the time of her death, and in the crop year of 1932, than she was in the crop years of 1929-30 and 1930-31. The creditors rely upon the case of Baxter v. Savings Bank of Utica, New York, 92 F.2d 404, decided by the Fifth Circuit. In that case, the court held that the farming activities of' the debtor were more in the nature of property management. I do not think the case is applicable here. If the facts of this case are all looked to, it will readily be realized that a frail injured woman, such as Lunnie Boney was during the years in question, could hardly be ‘primarily bona fide personally engaged in producing products of the soil’ in any other manner than by hiring some one to do the actual tilling of the soil. She personally hired all the hands that did the farming, paid them for their labor, part time occupied a shack on the farm and cooked for the hands. This presents a very different picture from the above case, or any other cases cited by the creditors.

“The next point raised is that Sammie E. Roach, in her capacity as independent executrix, is not the personal representative of Lunnie Boney, because the administration of the estate has been concluded. This is based on the fact that the [327]*327will so appointing her as independent executrix was probated and letters testamentary thereunder were granted to Sammie E. Roach on the 2nd day of May, 1932; that Arts. 3602 and 3681, Vernon’s Annotated Texas Civil Statutes contemplate the winding up of such administrations upon the estates of decedents within one year after the issuance of such letters; that it has been held in Texas, it may be presumed after the lapse of four and a half years from the granting of such letters that such an administration had closed, and the independent executrix thereafter holds the estate only in a capacity as trustee. The case cited to support this view is Nesbitt v. First State Bank of San Angelo, Tex.Civ.App., 108 S.W.2d 318. That case merely holds that such a presumption may be indulged in. Applying that case here, such presumption, nevertheless, can be rebutted by evidence showing that this administration was continuing through all the intervening years and up to the date of the filing of the petition herein. That is what the evidence here conclusively does show. The creditors, and even those making the motion to dismiss, have continually dealt with the executrix in her capacity as such. In addition to that, there is no evidence in the record anywhere showing, or tending to show that Sammie E. Roach ever did anything concerning this estate with the idea or thought that she was acting in a capacity merely as a trustee. The will of Lunnie Boney provides: T nominate and appoint my said sister, Sammie E. Roach, sole executrix of this will, and direct that no security shall be required of her as such executrix.’

“In her testimony, she recited many business matters she transacted in behalf of the estate during the early years of the administration, and, of course, all of them in her capacity as independent executrix. As to the latter years immediately preceding this petition, likewise she testified to many business matters she had attended to in behalf of the estate. Among others that she leased part of the land involved for oil in the year 1940, receiving upon one tract $640 down payment, and $320 yearly rental, all of which was applied upon first mortgage liens against the land. Also, that she kept the taxes paid on said property up to this year. The record reveals that the First State Bank of Stratford, one of the creditors here, sued her in her capacity as independent executrix on the 26th day of February of this year, in which it sought a judgment on its claim, foreclosure of its lien, etc. When you take all the facts into consideration, it conclusively rebuts any reasonable presumption of law that the administration had been concluded.
“The third proposition upon which the creditors rely presents a more interesting question. It is that the petition should be dismissed because Sammie E. Roach, as such executrix, did not obtain an order from her Probate Court, authorizing her to file the petition herein. For this they rely upon Sec. 202a of Title 11, U.S.C.A. as follows: ‘Section 202 of this title shall include the personal representative of a deceased individual for the purpose of effecting settlement or composition with the creditors of the estate: Provided, however, That such personal representative shall first obtain the consent and authority of the court which has assumed jurisdiction of said estate, to invoke the relief provided by this title/ (Italics mine.)

“The motion to dismiss was filed while the debtor was seeking to perfect a settlement for composition with the creditors of the estate, and before the debtor had filed to be adjudged a bankrupt under sub-sec. s of Sec.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

In Re Welch
74 B.R. 401 (S.D. Ohio, 1987)
In Re Paul P. Schoenburg, Debtor
279 F.2d 806 (Fifth Circuit, 1960)
Jones v. Jimmerson
302 S.W.2d 161 (Court of Appeals of Texas, 1957)
Williams v. Commissioner
16 T.C. 893 (U.S. Tax Court, 1951)

Cite This Page — Counsel Stack

Bluebook (online)
124 F.2d 325, 1941 U.S. App. LEXIS 4501, Counsel Stack Legal Research, https://law.counselstack.com/opinion/first-state-bank-v-roach-ca5-1941.