Beasley v. Gottlieb.

• Citation: 131 N.J.L. 117,35 A.2d 49
• Decision Date: 28 December 1943
• Docket Number: No. 401.,401.
• Parties: BEASLEY v. GOTTLIEB.
• Court: United States State Supreme Court (New Jersey)

131 N.J.L. 117

35 A.2d 49

BEASLEY

v.GOTTLIEB.

No. 401.

Supreme Court of New Jersey.

Dec. 28, 1943.

Action by Wister Beasley against Irene R. T. Gottlieb to recover $50 on each of two counts, plus attorney's fees and costs, for overcharges for rent under the Emergency Price Control Act, § 205(e), 50 U.S.C.A.Appendix, § 925(e). From a judgment dismissing the suit on ground of lack of jurisdiction in the District Court, plaintiff appeals.

Reversed and remanded.

Appeal from First District Court of City of Newark.

October term, 1943, before CASE, DONGES, and PORTER, JJ.

Samuel L. Rothbard and Rothbard, Greenstone & Harris, all of Newark, for plaintiff-appellant.

George R. Sommer, of Newark, for defendant-respondent.

CASE, Justice.

Plaintiff sued in the First District Court of the City of Newark to recover $50 on each of two counts, $100 in all, plus attorney's fees and costs, upon the allegation that the defendant had demanded and received from the plaintiff the sum of $28 rent for a living apartment for the month of July, 1942, and a like sum for the month of August, 1942, whereas the maximum monthly rental permitted under a regulation established by the Administrator of the Emergency Price Control Act of 1942 was $22-an overcharge on each of the two months of $6. The judge, holding that the suit was to recover a penalty imposed by the federal statute and that his court therefore lacked jurisdiction, dismissed the suit. The pertinent statutes are the New Jersey statute fixing the jurisdiction of District Courts: N.J.R.S. 2:8-40, N.J.S.A.: ‘Every action of a civil nature at law, or to recover any penalty imposed or authorized by any law of this state, where the debt, balance, penalty, damage or other matter in dispute does not exceed, exclusive of costs, the sum or value of five hundred dollars, shall be cognizable in the district courts of this state’, and the federal statute setting up the right to sue, being a part of the Emergency Price Control Act of 1942. 50 U.S.C.A.Appendix, § 925(e): ‘If any person selling a commodity violates a regulation, order, or price schedule, prescribing a maximum price or maximum prices, the person who buys such commodity for use or consumption other than in the course of trade or business may bring an action * * * for $50 or treble the amount by which the consideration exceeded the applicable maximum price, whichever is the greater, plus reasonable attorney's fees and costs as determined by the court. For the purposes of this section the payment or receipt of rent for defensearea housing accommodations shall be deemed the buying and selling of a commodity, as the case may be. If any person selling a commodity violates a regulation, order or price schedule prescribing a maximum price or prices, and the buyer is not entitled to bring suit or action under this subsection, the Administrator may bring such action under this subsection on behalf of the United States. Any suit or action under this subsection may be brought in any court of competent jurisdiction, and shall be instituted within one year after delivery is completed or rent paid. The provisions of this subsection shall not take effect until after the expiration of six months from the date of enactment of this Act.’

The decision of the United States Supreme Court in Huntington v. Attrill, 146 U.S. 657, 13 S.Ct. 224, 36 L.Ed. 1123, chiefly relied upon by appellant, states that the cemarcation between penal actions and civil actions, in the international sense, depends upon whether the purpose is to punish an offense against the public justice of the state or to afford a private remedy to a person injured by the wrongful act and holds that the statute in which that action grounded was remedial and not penal. The New York statute, out of which the litigation arose, made the officers of a corporation who signed and recorded a false certificate of the amount paid in on its capital stock jointly and severally liable for all the debts of the corporation contracted while they were officers thereof. Attrill, as a director of the company, signed and recorded a certificate that the whole capital stock of the corporation, $700,000, had been paid in, whereas, in truth, no part of it had been paid in. The litigation was to enable a creditor to reach personal property of Attrill in Maryland wherewith to satisfy a judgment, in the amount of the corporation debt, obtained in the State of New York. It was held that while the statute was penal as against defaulting trustees, it was remedial in favor of creditors. The reasoning is plain and convincing: the statute enabled persons complying with its provisions to do business as a corporation without being subject to the liability of general partners, but it took pains to secure a proper corporate fund for the payment of corporate debts and therefore made the officers liable, to the extent of those debts, because of their misleading fraud.

Whitman v. National Bank of Oxford, 176 U.S. 559, 20 S.Ct. 477, 44 L.Ed. 587, and Chattanooga Foundry & Pipe Works v. City of Atlanta, 203 U.S. 390, 27 S.Ct. 65, 51 L.ed. 241, also are cited. The former held that the liability of a stockholder under a statutory provision to contribute towards the debts of the corporation was contractual and that action thereon could be maintained in any court of competent jurisdiction. The holding in the letter case, in so far as pertinent hereto, is not so obvious; but it may be understood to be that a suit by a city to recover threefold for damage to property under § 7 of the federal act of July 2, 1890, ch. 647, 15 U.S.C.A. § 15 note, was not a suit for a penalty under Rev.Stat. § 1047, 28 U.S.C.A. § 791 (U.S.Comp.Stat.1901, p. 727). In Brady v. Daly, 175 U.S. 148, 20 S.Ct. 62, 65, 44 L.Ed. 109, an action to recover damages for infringement of copyrights in that unauthorized productions of a copyrighted play were given, it was held that the statutory fixing of minimum damages at $50 for each performance did not set up an action to recover either a penalty or a forfeiture, and the opinion moves upon such reasoning as this: ‘In Chatterton v. Cave, L.R. 3 App.Cas. 483, 492, the court in speaking of this provision for damages said that the same ‘was no doubt fixed, because of the difficulty of proving with definiteness what amount of actual damage had been sustained by perhaps a single performance at a provincial theater of a work belonging to a plaintiff, while at the same time his work might be seriously depreciated if he did not establish his right as against all those who infringed upon it.’'

In Atchison, T. & S. F. R.Co. v. Nichols, 264 U.S. 348, 44 S.Ct. 353, 354, 68 L.Ed. 720, the United States Supreme Court, passing upon the propriety of a suit in California, where allowable damages were a matter of proof, to recover for a death that occurred in New Mexico, where the recovery was statutorily fixed at $5,000, said: ‘The contention of petitioner is, as we understand it, not that damages in redress of death are opposed to the policy of California, but only when damages are given in a fixed amount as provided by the law of New Mexico, the Code of Civil Procedure of the state giving such damages only ‘as under all the circumstances of the case may be just’; therefore, confining the damages to compensation for pecuniary loss suffered by surviving relatives...