Hildreth, In re

• Decision Date: 19 August 1943
• Citation: 284 N.Y.S.2d 755,28 A.D.2d 290
• Parties: In re HILDRETH. Matter of Hildreth, etc. (Trust u/i dated
• Court: New York Supreme Court — Appellate Division

Page 755

284 N.Y.S.2d 755

28 A.D.2d 290

In re HILDRETH Matter of Hildreth, etc. (Trust u/i dated August 19, 1943) Matter of Hildreth, etc. (Trust u/i dated September 13, 1943) Matter of Hildreth, etc. (Trust u/i dated July 28, 1944) Matter of Hildreth, etc. (Trust u/i dated April 1, 1946) UNITED STATES TRUST COMPANY OF NEW YORK as substituted trustee, Petitioner-Respondent, v. Samuel L. SIEGEL, Respondent-Appellant. * * State Report Title: Matter of Storm

Supreme Court, Appellate Division, First Department.

Nov. 28, 1967.

Harris L. Present, New York City, for respondent-appellant.

Robert P. Weil, New York City, for petitioner-respondent.

Before BOTEIN, P.J., and EAGER, CAPOZZOLI, RABIN, and McGIVERN, JJ.

EAGER, Justice.

This is an appeal from an order, entered July 11, 1967, adjudging the respondent, an attorney, in contempt by reason of his failure to comply with a prior order of the court directing the return by him of certain trust funds improperly paid to him as counsel fees by a former (now removed) trustee. The order directed the payment of the balance of the sums remaining unpaid, with interest, and provided that upon proof of respondent's non-compliance with the order within 60 days, an ex parte application for his commitment would be entertained.

The proceeding was instituted by affidavit and order to show cause pursuant to Judiciary Law, section 757. The respondent submitted an affidavit in opposition to the application and contended that his failure to comply with the directions for payment was not wilful or contemptuous. He alleged that he was in ill health and financially unable to make further payments as directed. (He had paid a certain sum on account by depositing the same in escrow pending an appeal from a prior order.) Special Term, however, flatly held that 'the question of the respondent's ability to comply with the court's mandate may not be considered at this stage of the proceedings.'

The parties present on this appeal and argue on the merits the question of whether, on the application to punish for contempt, the court should consider the respondent's alleged inability to pay. The petitioner-trustee contends that the court was bound to direct respondent's commitment on failure of compliance with the prior order; that respondent's alleged inability to pay as directed was not a proper factor for consideration; and that respondent should be relegated to the remedy prescribed by Judiciary Law, section 775, for release from imprisonment following his commitment. (See Schmohl v. Phillips, 138 App.Div. 279, 122 N.Y.S. 974.)

Although the papers submitted by the respondent lack a satisfactory showing of his good faith and his inability to pay, a majority of us believe that he should not be committed without being given the opportunity to make a factual showing in support of his claims. In any event, we unanimously conclude that we should reach and set at rest the controversy frequently arising with respect to the present-day effect of Schmohl v. Phillips, supra.

The power is expressly conferred upon a court of record to punish a person for a civil contempt of court where he refuses or wilfully neglects to pay money directed to be paid by him by a judgment or order which '(1) requires the payment of money into court or to an officer of, or receiver appointed by, the court, except where the money is due upon the express or implied contract or as damages for the nonperformance of a contract; or (2) requires a trustee or a person acting in a fiduciary relationship to pay a sum of money for a willful default or dereliction of his duty.' (CPLR 5105. See, also, CPLR 5104; Judiciary Law, § 753.) It is well settled, however, that the power so conferred upon the court is discretionary and is to be exercised in the light of the facts and circumstances in each particular case. The petitioner establishing a refusal to pay the sum of money directed to be paid is not generally entitled as a matter of law to an order committing the respondent for contempt. (Nelson v. Hirsch, 264 N.Y. 316, 318, 190 N.E. 653, 654; Gluck & Co. v. Tankel, 12 A.D.2d 339, 211 N.Y.S.2d 602; Victor v. Turetz, 266 App.Div. 311, 313, 42 N.Y.S.2d 33, 34. See, also, National Sur. Corp. v. Silver, 23 A.D.2d 398, 403, 261 N.Y.S.2d 511, 516, revd. on other grds., 17 N.Y.2d 477, 266 N.Y.S.2d 983, 214 N.E.2d 162.) Although the court has power to grant an order of contempt in the cases specified, it is not legally bound to do so. (Nelson v. Hirsch, supra, 264 N.Y. p. 318, 190 N.E. p. 654.)

Applications to punish as a civil contempt the noncompliance with court directives are generally addressed to the sound discretion of the court. (5 Weinstein-Korn-Miller, N.Y.Civ.Prac., 5105.01, 5105.05, 5105.07; Gluck & Co. v. Tankel, supra; Thompson v. Thompson, 197 App.Div. 228, 188 N.Y.S. 785.) Of course, if it appears that the inability of the respondent to pay or perform was occasioned by his flagrant or wrongful act (see People ex rel. McGoldrick v. Douglas, 286 App.Div. 807, 141 N.Y.S.2d 353; Grant v. Greene Consolidated Copper Co., 125 App.Div. 833, 835, 110 N.Y.S. 253, 255), or it appears that there has been a wilful and contemptuous refusal to pay over a specific and particular existing fund in the respondent's possession (see Victor v. Turetz, supra, 266 App.Div. p. 313, 42 N.Y.S.2d p. 34), there is little room for the exercise of discretion. Generally, however, upon an application for a contempt adjudication, the court should exercise its judicial discretion broadly to accomplish justice on the basis of all facts and circumstances bearing upon the nature and wilfulness of the respondent's conduct.

Furthermore, a contempt adjudication generally requires the exercise of the court's discretion in determining the nature and extent of the punishment to be imposed, in determining whether or not the respondent should have an opportunity to purge himself of the contempt and in fixing the conditions relative thereto. 'There is a large degree of discretion lodged in the court in the matter of punishing for a civil contempt, and as to conditions on which contempt may be purged. This discretion may be exercised both as to inflicting or refusing to inflict punishment, and in case of a determination to impose punishment, as to imposing a fine or committing to imprisonment, or both. And within the limitations prescribed by statute, the court may exercise discretion as to the amount of the fine or the length of the imprisonment.' (21 Carmody-Wait, § 157, p. 310.)

Where there is a proper and factually supported showing on behalf of respondent of his good faith in his endeavors to comply with a court mandate and of his inability to comply therewith, the court should not abdicate its discretionary responsibilities upon the ground that the respondent, after imprisonment, may have a remedy under Judiciary Law, section 775. The existence of a post imprisonment remedy certainly does not authorize a jailing which, at its inception, would be contrary to the interests of justice.

We are aware, of course, that the 1910 decision of this department in Schmohl v. Phillips (138 App.Div. 279, 122 N.Y.S. 974, supra) is frequently cited as supporting a general holding that a motion to be discharged from imprisonment, as authorized by said section 775 of the Judiciary Law, constitutes the exclusive remedy of a respondent for his alleged inability to endure imprisonment or to comply with a court directive. This decision has been said to have established a general rule whereby it is 'obligatory upon the court to imprison a respondent in spite of a demonstration of pertinent circumstances which would require it to issue an order for release upon an application made immediately after the incarceration.' (See legislative note to bill amending Section 84 of...