Escambia Chemical Corp. v. United Ins. Co. of America, 79-941
| Decision Date | 24 March 1981 |
| Docket Number | No. 79-941,79-941 |
| Citation | 396 So.2d 66 |
| Parties | ESCAMBIA CHEMICAL CORPORATION, a corporation v. UNITED INSURANCE COMPANY OF AMERICA, a corporation et al. |
| Court | Alabama Supreme Court |
Allen Edward Cook of Cook & Cook, Andalusia, for appellant.
W. Harold Albritton of Albrittons & Givhan, Andalusia, for appellees.
The holder of a money judgment against an insurance debit agent sued out a garnishment against the agent's company claiming that the following funds were subject to garnishment: (1) commissions earned and retained by the agent but not transmitted to the company; (2) proceeds of a cash bond posted by the agent with the company; and (3) certain pension benefits which might be payable to the agent.
The trial court found that the company had no funds in its possession or control which were owing to its agent, and dismissed the garnishment.
The facts are essentially uncontroverted. Escambia Chemical Corporation had obtained a money judgment against J. W. Kirkland, the insurance debit agent of the garnishee, United Insurance Company. Kirkland had earned, but retained, commissions totaling $2,524.19 from the date of the filing of the writ of garnishment on August 13, 1979, and the date of the preparation of answers to interrogatories on or about November 26, 1979. United had paid the employer's part of social security taxes for Kirkland and Kirkland had paid his employee's share of social security taxes, withholding taxes, group insurance and pension plan contributions. United declared the commissions earned by Kirkland as a deduction on its corporate income tax return, thereby taking full advantage of the sums retained by Kirkland as an operating expense deduction.
The evidence shows that Kirkland, as an agent of United, was required to post with the company, and maintain, a $1,000 cash bond, which was refundable: (1) if Kirkland terminated his employment with the company, whereupon the $1,000 would be refunded to him, less any indebtedness he might owe to the company; (2) if Kirkland had ten years of service with the company; and (3) if Kirkland was promoted to a salaried position. The company was obligated to pay six percent interest on the cash bond if it was refunded.
Escambia contended that three funds were subject to its garnishment: Kirkland's commission, the $1,000 cash bond, plus interest which had accrued thereon, and contributions made to an employee pension plan and held for Kirkland's benefit.
The trial court rendered a judgment in favor of the garnishee, United, which stated, in part:
The garnishee insurance company does not come into possession or control of any money owing to Mr. Kirkland, the defendant, independent of Mr. Kirkland. There is no liability on the part of the garnishee to the defendant, Kirkland, as would enable the defendant, Kirkland, to maintain an action at law against the garnishee and recover a judgment.
Contributions to the pension plan would be a contingent liability and not subject to garnishment until such time as the defendant had a claim or is eligible for such benefits.
The appellant raises the following issues on appeal:
(1) Did the trial court err in ruling that the commissions in question were not subject to garnishment;
(2) Did the trial court err in ruling that United's pension plan for Kirkland was a contingent liability and, as such, not subject to garnishment until such time as Kirkland has a claim or is eligible for such benefits;
(3) Did the trial court err by not entering a judgment requiring United to pay Escambia the $1,000 cash bond held on deposit by United for Kirkland;
(4) Did the trial court err by not requiring United to pay Escambia the six percent interest which accrued upon the $1,000 cash bond held on deposit by United for Kirkland; and
(5) Did the trial court err in not keeping United before the court so that any future debt which would accrue by a contract in existence could be subjected to Escambia's...
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