Department of Public Welfare, Etc. v. Allen
| Decision Date | 22 June 1934 |
| Parties | Department of Public Welfare, for Use and Benefit of Central State Hospital et al., v. Allen et al. |
| Court | United States State Supreme Court — District of Kentucky |
2. Army and Navy. — Possession of guardian or committee of World War veteran is regarded as possession of veteran as regards creditors' right to compensation received from United States government (World War Veterans' Act 1924, sec. 22 [38 USCA sec. 454]).
3. Army and Navy. — Money or property purchased by committee of World War veteran with money received from United States for use of disabled veteran held subject to claim of state for his care, board, and maintenance while he was inmate of state institution for insane (Ky. Stats., secs. 216aa-37, 216aa-38; World War Veterans' Act 1924, sec. 22 [38 USCA sec. 454]).
Appeal from Jefferson Circuit Court
LEE HAMILTON, J.D. VIA, and WM. J. DEUPREE for appellant.
TRABUE, DOOLAN, HELM & HELM, W.A. ARMSTRONG, and HENRY J. TILFORD for appellee.
Reversing.
Benjamin F. Allen, a World War veteran, became mentally incompetent by reason of his service in the Army in the late war, and on March 21, 1927, was adjudged to be of unsound mind and was committed by the Jefferson circuit court to the Central State Hospital at Lakeland, Ky. He remained in that institution continuously from March 21, 1927, until June 30, 1927, when he was released. Later he was committed by the Meade circuit court to the Western State Hospital at Hopkinsville, Ky., where he remained as an inmate from November 22, 1929, until December 7, 1930. These institutions are owned and maintained by the state, and by statute the department of public welfare, successor of the state board of charities and corrections, has general supervision over them. By an order of the Jefferson circuit court, entered on February 24, 1930, the Kentucky Title and Trust Company of Louisville, Ky., was appointed committee for Allen.
The department of public welfare, suing for the use and benefit of the Central State Hospital and the Western State Hospital, brought this action against Benj. F. Allen and his committee to recover the sum of $1,205, the amount alleged to be due for his care, board, and maintenance while he was an inmate of these state institutions. The action is authorized by section 216aa-37 of the Kentucky Statutes, which reads:
"Where the patients have been, or may be, supported in any of the institutions embraced in the provisions of this act have, or shall acquire estates which can be subject to debt, they shall be liable for their board and maintenance, and the board of charities and corrections is authorized and directed in every such case to sue for in name of such institution and recover the amount of such patient's board at the rate fixed by the board or so much thereof as such estate will suffice to pay for the time they shall have been respectively kept and maintained therein and not otherwise paid for, and by proper proceedings to subject their estates, respectively, to payment thereof; and when the husband, wife or parent of any such patient, who has been or may be supported in any of said institutions, shall have an estate sufficient for the support of such patient in addition to the support of any other who may be dependent on such husband, wife or parent, in like manner to sue for and recover from such husband the amount of his wife's board, or from such wife the amount of her husband's board, and from such parent the amount of his or her child's board at the rate aforesaid, for the time they shall have been supported by such institution." Section 216aa-38 provides that:
"The board may fix the rate to be paid for the support of a person by his committee or by relatives liable for such support, or by those not liable for such support, but willing to assume the cost thereof; but such rates shall be sufficient when possible to cover a proper proportion of the cost of maintenance and of necessary repairs and improvements, and the same rate shall be charged to all persons."
On November 28, 1923, the state board of charities and corrections fixed the rate to be paid for the support of a person by his committee, or by relatives liable for such support, at $360 per annum.
The petition alleged that, since his discharge from the Army, Allen had been drawing compensation from the United States government, and his committee then had in its hands personal property belonging to him, the character and kind of which was unknown to the plaintiff, and that it, as his committee, had on deposit in the Kentucky Title & Trust Company a sum of money, the exact amount of which it could not state, and it asked that the committee be required to disclose the kind and amount of property in its hands belonging to Allen.
The committee filed an answer in which it averred that the property in its hands as the committee for Allen was money, or property purchased with money, which had been paid to it or Allen by the United States government as compensation under the World War Veterans' Act, U.S.C. title 38, sec. 471, et seq. (38 USCA sec. 471 et seq.), and that by the provisions of that act such funds and property were not subject to debts or the claims of creditors.
The case was submitted on the pleadings, and the chancellor adjudged that the property in the hands of the committee was not an estate which could be subject to debt under section 216aa-37 Ky. Statutes, and the petition was dismissed.
The question presented by this appeal is whether moneys or property purchased by the committee of a veteran with moneys received from the United States for the use of the disabled ward are subject to the claims of the ward's creditors.
Section 22 of the World War Veterans' Act (38 USCA sec. 454) reads:
Act of June 7, 1924, c. 320, sec. 22; U.S.C. title 38, sec. 454 (38 USCA sec. 454).
The exact question presented for decision is one of first impression in this court, and we fail to find where it has been considered by the Supreme Court of the United States but analogous cases involving the construction of section 22 of the World War Veterans' Act have been passed upon by this court and other courts, including the Supreme Court of the United States, and these decisions are helpful in reaching a correct solution of the problem before us. In First National Bank of Horse Cave v. Cann's Ex'x, 247 Ky. 618, 57 S.W. (2d) 461, it was held that insurance money paid to a dead soldier's estate by the United States was not exempt from the claims of the soldier's creditors. In Smith v. Spicer's Guardian and Committee, 244 Ky. 68, 50 S.W. (2d) 64, the committee for an incompetent veteran had on deposit in a bank which became insolvent money which had been paid to him by the United States as compensation and war risk insurance due his ward, and his claim of preference over the other creditors of the bank was disallowed on the ground that the title had passed from the United States. The Supreme Court of the United States granted a writ of certiorari because there was a conflict in the decisions of the state courts upon the question and affirmed the judgment of this court. Spicer v. Smith, 288 U.S. 430, 53 S. Ct. 415, 417, 77 L. Ed. 875, 84 A.L.R. 1525. Appellees rely on certain language found in that opinion in support of their claim that the exemption provisions of section 22 of the World War Veterans' Act apply to funds after they have passed into the hands of the beneficiary. That language is as follows:
"The provisions for exemption, nonassignability, and suspension of payments plainly imply the passage of title from the United States to the veteran."
The foregoing excerpt from the opinion in Spicer v. Smith clearly implies the contrary....
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