Stookey Holsteins, Inc. v. Van Voorst (In re Stookey Holsteins, Inc.)

117 B.R. 402, 1989 Bankr. LEXIS 2658
CourtDistrict Court, N.D. Indiana
DecidedSeptember 20, 1989
DocketBankruptcy No. 86-31174-RKR; Adv. No. 87-3082
StatusPublished

This text of 117 B.R. 402 (Stookey Holsteins, Inc. v. Van Voorst (In re Stookey Holsteins, Inc.)) is published on Counsel Stack Legal Research, covering District Court, N.D. Indiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Stookey Holsteins, Inc. v. Van Voorst (In re Stookey Holsteins, Inc.), 117 B.R. 402, 1989 Bankr. LEXIS 2658 (N.D. Ind. 1989).

Opinion

ORDER

ROBERT K. RODIBAUGH, Senior Bankruptcy Judge.

On May 19,1987, Stookey Holsteins, Inc., the debtor herein, filed its Complaint for Turnover against Schuyler Van Voorst and John Van Voorst requesting the court to order the Van Voorsts to return certain livestock owned by the debtor and held by the Van Voorsts pursuant to a Board Agreement dated October 12, 1984. On July 20, 1987, the parties advised the court that they would be able to stipulate all the relevant facts. The parties filed their Stipulation on September 30, 1988, after which time the court permitted the parties to file briefs in support of their respective positions. On February 13, 1989, following the time allowed for submitting briefs the court took the matter under advisement.

Background

Stookey Holsteins, Inc., filed its petition under Chapter 11 of the Bankruptcy Code on September 3, 1986. In its Complaint for Turnover the debtor alleges that at the time of filing its petition the Van Voorsts held certain cattle owned by the debtor pursuant to a Board Agreement dated October 12, 1984, whereby the Van Voorsts agreed to provide daily care for the cattle in return for the payment of $1.50 per day for each animal. In its complaint the debt- or states that the Van Voorsts have filed a Proof of Claim in the debtor’s main case for $42,181.00 which the debtor allegedly owed to the Van Voorsts at the time of the filing of the debtor’s petition. The debtor submits, however, that it is unable to pay the pre-petition debt and unable to determine the administrative debt due the Van Voorsts at this time. The debtor asserts that it asked for the return of its cattle but that the Van Voorsts declined to return the livestock claiming they hold a security interest therein pursuant to Ind.Code § 32-8-29-1. The debtor asks for the immediate return of its cattle and asks the court to determine the amount of the Van Voorsts’ pre-petition claim as well as any administrative claim to which the Van Voorsts are entitled.

The Van Voorsts filed their Answer and Counterclaim on April 17, 1987, in which they deny that John Van Voorst is a party to the October 12, 1984, Board Agreement, deny that the debtor is unable to determine the amount of Schuyler Van Voorst’s administrative claim, and submit that if the court permits the cattle to be sold, the court should protect their claim of lien by transferring their rights to the proceeds from the sale. Schuyler Van Voorst further asserts a counterclaim against the debtor alleging that he is entitled to recover the amount listed in his Proof of Claim filed in the debtor’s main case as well as his expenses of approximately $3,000.00 per month in feeding the debtor’s cattle subsequent to the filing of the debtor’s petition. Van Voorst contends that the court should permit him to foreclose upon his agister’s lien and to collect the proceeds from the sale of the debtor’s cattle and should award him periodic adequate protection payments in the interim.

In their Stipulation filed September 30, 1988, the parties agree that:

1. With regard to Plaintiff’s complaint, Defendants have surrendered possession of the cattle which were the subject matter thereof, and said matter is [404]*404moot, except for the request that the claims of Defendants [sic]1 be determined.
2. With regard to Defendants' [sic] counterclaim:
a. Said counterclaims [sic] relate only to a claim of agister’s lien for care and feeding to [sic] Debtor’s cattle rendered prior to the order for relief herein; Defendant Schuyler Van Voorst has also filed an administrative claim herein which remains pending.
b. The [B]oard [Agreement ... was in full force and effect at all relevant times herein.
c. The cattle listing attached to Plaintiff's complaint as Exhibit “B” is an accurate enumeration of cattle in possession of Defendant Schuyler Van Voorst at the time of the order for relief herein....

Stipulation (September 30, 1988). The parties attached Schuyler Van Voorst’s Schedule of Itemization of Secured Claim to their Stipulation listing Van Voorst’s periodic calculation of expenses accumulated and payments made under the Board Agreement as Exhibit “B.”

In its memorandum in support of its complaint, which is a copy of a memorandum supporting the position of the debtor in Adversary Proceeding No. 87-3014 dealing with the question of whether the plaintiff therein created a liveryman’s lien under Ind.Code 32-8-29-1,2 the debtor asserts that in .order for one to take advantage of the rights and remedies available under Ind.Code 32-8-30, one must adhere to the requirements of Ind.Code § 32-8-30-9. Specifically, the debtor asserts that a person first must give an owner of property a receipt stating his lien rights in property entrusted to him in order to qualify as the holder of an agister’s lien with the rights and remedies provided under § 32-8-29-1. In support of its position the debtor cites the policy consideration of protecting an owner’s property rights over alleged pos-sessory rights in property. The debtor argues that the court must construe the statutory requirements strictly in order to avoid contravening the legislature’s intent and accordingly that as Schuyler Van Voorst failed to issue a receipt to the debt- or which met the statutory requirements, the court must find that he has no lien in the cattle or the proceeds therefrom.

Discussion and Decision

Title 28 U.S.C. § 157 provides that the “determination of the validity, extent, or priority of liens” is a core proceeding to be determined by the bankruptcy court. 28 U.S.C. § 157(b)(2)(E) (Callaghan 1988). The issue before the court is whether Schuyler Van Voorst holds an agister’s lien in the proceeds from the sale of the debt- or’s cattle, and if so to what extent, and whether he is entitled to interim adequate protection payments to secure any lien he may have. The parties agree that state law controls in determining whether Van Voorst holds an agister’s lien in the debt- or’s property.

Ind.Code § 32-8-29-1 states:

The keepers of livery stables and all others engaged in feeding horses, cattle, hogs and other livestock shall have a lien upon such property for the feed and care bestowed by them upon the same, and shall have the same rights and remedies as are provided for those persons having, before July 24, 1853, by law, such lien in IC 32-8-30.

Ind.Code Ann § 32-8-29-1 (Burns Supp. 1989). Ind.Code § 32-8-30 provides that a bailee who has a lien for the feed or care of animals may sell that part of the livestock necessary to pay his charges upon proper notice. Ind.Code Ann. §§ 32-8-30-1, 32-8-30-3, 32-8-30-4, and 32-8-30-5 (Burns Supp.1989).

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Cite This Page — Counsel Stack

Bluebook (online)
117 B.R. 402, 1989 Bankr. LEXIS 2658, Counsel Stack Legal Research, https://law.counselstack.com/opinion/stookey-holsteins-inc-v-van-voorst-in-re-stookey-holsteins-inc-innd-1989.