History is mainly a series of unfortunate events, as the great philosopher Lemony Snicket tells us, and this week Santa Rosa has endured more than its share of history. Sometimes, though, there are events like this one, which begins with a truckload of awfulness but everything turns out okay in the end – and that’s the sort of history story we might all welcome right now, lordy knows.
Once upon a time it was March, 1933.
The whole world was in a handbasket and going fast; Japan pulled out of the League of Nations, ultimately dooming the last hope of maintaining world peace. In Germany, each day found the Nazis grabbing more control, with U.S. newspapers printing photos of “Hitlerites” pasting boycott signs over the windows of Jewish-owned stores. As Franklin Roosevelt had just taken office none of the New Deal reforms were yet in place. It was the darkest time of the Great Depression and since Prohibition was still a thing, no one could even drown their misery in a damn beer.
In Graton a hundred farmers attended a meeting of the newly-formed Farmers’ Protective League. The objective was to convince these apple, prune, cherry and berry growers they should organize and protest, but leave their pitchforks and guns at home.
All/most of them had mortgages which were underwater, and their common enemies were the banks. Land values had plummeted and farmers weren’t getting much for their crops. Bankers were unsympathetic and foreclosed on farms which had been in families for years or decades or generations, selling the properties at auctions for rock-bottom prices or stashing them away for the institution’s real estate portfolio. (Remember that the family in Grapes of Wrath weathered the dust storms but couldn’t survive their bank eviction.) Nationally, around one in ten farms had been seized since the start of the Depression and meetings like the one in Graton were being held all over the country.
“When they attempt to foreclose we’ll say ‘no!’ but not by rope or shotgun,” said Rev. Charles Phillips, the priest at St. Sebastian’s church in Sebastopol and the organizer of the League meeting that day at the Community Hall in Graton. “Our strength will be in numbers. It is a question of understanding and brotherly love, not of cold blooded murder.”
The pastor was not being melodramatic; there was more than a whiff of violence in the air over this issue, and maybe even rebellion. Wilfred Howard, who was elected president of the League, said farmers would do something “even if it meant revolution.”
“Iowa” was then a rallying cry much like “Lexington and Concord” had been in 1776. In that state a “farmer’s mortgage holiday” movement began which quickly spread to at least ten states. The largest group there warned “open revolt” was possible and the same day of the meeting in Graton, 2,500 Iowa farmers marched on the state capitol building threatening they would “forcibly adjourn” the legislature unless something was done. “You can’t make peasants out of us!” warned the president of the Iowa Farmer’s Union.
Those activist farmers were remarkably successful in shutting down foreclosure sales. When an auction was scheduled, the farmer’s neighbors would attend en masse and crowd out other bidders, buying livestock and farm equipment for a few pennies in order to give it back to the foreclosed farmer. Outsiders were also scared away by nooses hanging on barn doors and farm gates to show the locals “meant business.” And in the most widely reported incident, on January 4, 1933 in Le Mars, Iowa, the “Council for Defense” beat up the sheriff, forced the judge to issue a statement calling for a mortgage holiday, and dragged the representative of the mortgage company down the courthouse stone steps while threatening to lynch him.
The focus of the Graton meeting was the pending foreclosure of James Case, who had a fifty acre farm on Mirabel Road outside of Forestville where he grew cherries and apples. A 70 year-old retired Methodist minister, Case had lived there for over two decades; his farm was called a “showplace” and he was respected for Burbanking a cross between Gravensteins and the sweeter Jonathans.
Case had a $14,000 mortgage with the Analy Savings Bank in Sebastopol. In the autumn of 1932 he turned over to the bank his entire earnings from his crop of 7,000 boxes of apples, but still couldn’t meet the full interest-only payments on the mortgage, much less pay for insurance and taxes. For reasons which seems legally fishy (at least today), the bank placed the farm in a sort of pre-foreclosure receivership, paying a man named Frank Close to become the farm manager. More about Mr. Close later.
The Press Democrat interviewed bank president Arthur Swain, and the article should have included a trigger warning: Mr. Swain came across as a more horrible person than even villainous banker Henry Potter in “It’s a Wonderful Life.”
In Swain’s view, Case had no one to blame but himself because he was too stupid to not foresee that someday an unprecedented economic catastrophe might decimate crop prices. Rather than irresponsibly investing in the future of his farm, Case should have given every spare dime to the bank: “…instead of reducing the loan when good years came along Case has seen fit to use his money elsewhere,” and even increased the loan by another $1,000.
“Case refused to do his part when the opportunity was given him,” said Swain. “So it is in the hands of the law…unless the borrower is willing to do everything in his power and to act honestly and fairly, we are driven much against our will to resort to our legal rights.”
So what was Case doing that was dishonest and unfair? Swain offered him a second mortgage which would be secured by his farm machinery, but Case didn’t accept the deal. When Swain learned Case was giving some of the equipment he owned to his son, the bank moved swiftly to foreclose.
Then to demonstrate he was utterly tone deaf to the outside world, Swain concluded his interview by boasting about how well his bank was doing.
Swain’s loathsome interview appeared just before the big July 9 gathering at the “doomed Case ranch,” as the Farmers’ Protective League was now calling it. Around a thousand were expected to attend the all-day picnic and rally, with signs advertising it on all roads leading to Forestville. This was now national news with at least one reporter from as far away as Kansas.
American flags hung from the Case farmhouse porch as the crowd gathered. A telegram from the governor was read in support.
The main speaker waved the edition of the Press Democrat with the Swain interview at the crowd. “His story makes a case for us instead of himself! Swain says the bank will be fortunate to sell the ranch now for $14,000, the amount of the mortgage!”
J. Stitt Wilson, the former Socialist mayor of Berkeley, urged the audience to rise up. “The sale must be stopped! They did it in Iowa and you can do it here!”
“Yes! Yes!” roared the crowd, according to the Press Democrat.
Wilson declared this was not going to be a radical action, but true “Americanism,” not unlike the Revolutionary War. “Human rights and human laws transcend any law, and if necessary, we will break every law to reach our needs. But there is no law that can prevent hundreds of thousands of farmers from the San Francisco bay north into Mendocino county mobilizing and giving notice that no foreclosure will be permitted.”
What would happen in the next few days would be a turning point in American history, Wilson proclaimed. “Your children may return here to place markers under these very oaks to commemorate you courage.”
The rally was on a Sunday, and a full week stretched ahead before the foreclosure auction. Every day, tensions rose.
League president Wilfred Howard sent a telegram to the governor asking him to intervene, as anything might happen. “Our League can no longer be responsible for what will result. The aroused public sentiment is something that can no longer be held in check.”
Banker Swain – who apparently found a great sale on shovels and decided to dig himself a deeper hole – agreed that the Case foreclosure was now a Big Deal, but any compromise by the bank would destroy the nation: “The whole capitalistic system is involved in this controversy…this agitation is beginning to destroy business confidence…should these agitators be successful in taking the law in their hands, the results would be disastrous. Are we to allow a few radical socialists to run our banks?”
Also: FDR asks Henry Morgenthau, head of the new Farm Credit Administration to look into the situation. Howard sends Morgenthau a telegram pleading for the government to intervene. Morgenthau calls Swain. And just three days before his farm was to be sold at auction, James Case hires an attorney.
As the clock ticks down, Case’s new lawyer requests to postpone the auction for a week until he could appeal to the Superior Court. But there is a hitch – no Superior Court judge was available to approve or deny. Donald Geary was on vacation and Hilliard Comstock was presiding at the Superior Court in Ukiah.
It is Friday July 14, 1933, and there are THREE THOUSAND people jammed shoulder to shoulder in front of the courthouse in downtown Santa Rosa. The Press Democrat describes there is “grim determination and anxiousness” in the crowd, “somber, serious, not a smile on a single face.”
From the top of the courthouse steps a lineup of speakers holds the rapt attention of the crowd. Ex-mayor Wilson declares the moment of crisis has arrived: “This is a historic meeting with national significance…we have fired the shot that will be heard around the world,” he vows. “We must lift this crushing and horrible nightmare of law pressing down people…we aren’t destroyers, but preservers, preservers of the liberty that flag represents” he declares as he dramatically points to the American flag above his head.
|J. Stitt Wilson addresses the crowd from the Santa Rosa courthouse steps. Detail from Press Democrat photograph, July 15, 1933|
As Wilson finishes, there is a “moment of intense silence” as everyone waits for the auction to begin. Then, according to the PD:
…A man pushed his way through the crowd and forced his way to Wilson’s side, whispering in his ear. There was a hurried conversation and Wilson turned and faced the great crowd before him and cried: “I have an announcement to make. Judge Comstock has signed a restraining order. The sale has been postponed. There will be no foreclosure sale on the Case property today!” Someone called for three cheers, then Wilson shouted, “Let’s do it again: Three cheers for Judge Comstock!”
With the tension broken, everyone joins in singing the Battle Hymn of the Republic, because naturally.
Afterwards Judge Comstock explained to reporters that his ruling was based only on the merits of the case, and it could have been resolved earlier if James Case had not waited until the last moment to retain consul. It turned out that the bank had accepted a $771 payment from the farm’s cherry crop after “notice of breach” was served, so there was no accounting as to what Case really owed.
Comstock insisted he wasn’t intimidated: “I want it understood that I deplore such a demonstration as this — a demonstration that makes Sonoma county farmers, who will soon be rich men again, the objects of pity or contempt in the eyes of the nation. Our hops and grapes alone will save us. But there are my own people. I know them and I know they would not have used violence.”
But this is not yet the happy ending, and there were new depths to which Mr. Swain and his bank would sink.
The day after the foreclosure was halted, the Press Democrat published a document that Swain was prepared to give James Case once the bank had the deed to his farm. He would have a three-month option to repurchase his property for about $14,000 (after a few adjustments) – although if he had a spare $14 thousand laying around he would not have been in such a pickle in the first place.
But even if he did manage to scratch up all that money somehow (reminder: no money to borrow during the darkest time of the Depression) there was a catch-22 to the agreement – he would have to turn over “the full possession of the ranch and the right to the bank’s representative to gather and market the crops.” In other words, his place would be in permanent receivership with him paying someone (of the bank’s choosing) to manage his orchards.
If that smells a little fishy, a great deal more stink was discovered at the Superior Court hearing a week later. Banker Swain was also president of Sebastopol National Securities company, which actually held the Case mortgage. Frank Close – the guy who the bank had earlier hired – sold the entire cherry crop from the Case farm to the Securities company (the price was never disclosed). That company in turn sold the crop for $771, which it placed in the bank as a partial interest payment.
Much of the court doings were tangled up with the confusion of Swain having two hats but one head. Although investor Swain insisted in court that Close was an agent for the Securities company, at the time banker Swain made it clear that he answered to the bank. The $771 was first deposited in Close’s bank account, then one of the Swain personalities apparently thought that might look bad and transferred it to the Case mortgage account.
It also came out in court that Swain had a side deal with Close to sell him the entire farm for $15,000 after foreclosure.
After a full day of testimony, Judge Comstock ruled: The temporary injunction against the foreclosure was made permanent. You can’t say someone is in breach of contract and then accept money from them as if it were business as usual.
Comstock also remarked that he thought Swain was duplicitous – that the repurchase offer he made to Case wasn’t done in good faith, and he intended to sell the farm to Close all along.
Case and his supporters were jubilant, both for him personally and what it would mean for other farmers now that a Superior Court judge had set such a precedent. “This day has shown that the faith of the farmer in the courts of California is justified,” a grower in similar trouble told the Argus-Courier.
The Petaluma newspaper also burbled over what had happened: “…Superior Judge Hilliard Comstock, young, progressive, alert and courageous, has ruled against one of the most powerful financial institutions in Sonoma county…he administers the law as he interprets it, regardless of the power of those disappointed by his rulings.”
Despite losing the decision and being personally slapped down by a judge, Swain continued to explore new ways to act like a cartoon villain, swearing he would get his hands on the Case ranch yet. “Appeal? Of course we’ll appeal! And we will be backed by financial, real estate, and business interests of the state in doing so.” The next month the Analy Savings Bank did appeal the decision and filed another breach notice against Case, but before they came to court FDR’s New Deal programs (such as the Emergency Farm Mortgage Act and Farm Credit Act) had programs in place to help poor farmers.
James LaDue Case continued to live on his farm until 1947, when he retired and moved to Sebastopol. He died there in 1951 at the age of 88, outliving his old nemesis Arthur Swain by a dozen years.
The en…oh, wait, there’s more.
If you’ve lived in Sonoma country for a few many moons, you’ve probably heard about the Case foreclosure before, but told with a different slant. In that version, the hero of the day was Press Democrat editor and publisher Ernest Finley.
This alternative history seems to have originated in an August 3, 1975 feature in the PD about his family. “Ernest L. Finley–A Man of Vision,” written by Sheri Graves Gayhart, spreads it on thick. “Sonoma County farmers had little hope of saving their lands without the personal interest and support of a man as strong and influential as Ernest L. Finley.”
“Fighting for what he believed was right, he turned a grim situation into what was perhaps his finest hour,” the writer exclaims, going on that Finley was working “…behind the scenes, quietly, with no fanfare and no publicity” to negotiate an ethical solution. In this telling, Judge Comstock was little more than a bureaucrat who “ultimately decided the issue on the basis of a legal loophole.”
Versions of the story which have subsequently appeared in the Press Democrat have dialed it back somewhat but still followed her lead, downplaying Comstock and putting the spotlight on Finley.
Trouble is, author Gayhart didn’t mention where she found her facts and the newspapers of the day do not support her interpretation.
As far as I can tell, Finley apparently mentioned the James Case situation directly only once in an editorial, while the PD ran a handful of generic editorials and cartoons on the hot topic of farm foreclosures during those months.
Finley’s only direct involvement implied in the 1933 PD was a July 15 front page photo of Finley with Swain’s hand on his shoulder as they pose looking over the bank’s refinancing offer – the deal Comstock called dishonest. The photo caption states approvingly that Swain’s proposition was “considered most liberal.”
Unless new information surfaces about Ernest Finley’s actual involvement, I’m calling this out as a kind of “stolen valor.” Hilliard Comstock faced the sort of decision that few of us will ever have to confront. Swain indeed represented powerful business interests which did not want this sort of precedent to stand, and given time, probably would have destroyed Hilliard’s reputation to further that goal. The mob of 3,000 outside the courthouse were a more immediate threat and their actions could have gone in any of a number of directions – a riot, an attack on the courthouse, even sparking a national populist uprising which could have squelched the New Deal reforms before they took root.
The story of James Case’s farm is probably the most significant event in our history from those days, but it’s not important for anything he did, or any telephone calls Ernest Finley may or may not have made. It should be remembered for what Hilliard Comstock had the courage to do, standing up alone for the principle of the law, come what may.