Passaic Nat. Bank & Trust Co. v. Eelman

• Decision Date: 03 March 1936
• Citation: 183 A. 677
• Parties: PASSAIC NAT. BANK & TRUST CO. v. EELMAN et al.
• Court: New Jersey Supreme Court

183 A. 677

PASSAIC NAT. BANK & TRUST CO.

v. EELMAN et al.

Supreme Court of New Jersey.

March 3, 1936.

Proceeding by the Passaic National Bank & Trust Company against Garret Eelman, Sr., and others. On rule to show cause.

Judgment for plaintiff in accordance with opinion.

Argued before HEHER, J., at the Passaic Circuit.

Jerome Alper, of Newark (Samuel B. Friedman, of Newark, of counsel), for plaintiff.

Joseph J. Weinberger, of Passaic, for defendant Garret Eelman, Sr., and Police and Fire Pension Commission of City of Passaic.

HEHER, Justice.

The decisive question is whether pension moneys payable to a retired police officer, in semimonthly installments at the rate of $110.25 per month, from the fund created by and maintained under the provisions of chapter 160 of the Laws of 1920 (Pamph. L. p. 324), § 4, as amended by chapter 171 of the Laws of 1935 (Pamph.L. p. 405), N. J.St.Annual 1935, § *136—3900L (4), are the subject of garnishment or levy under the special statutory execution to satisfy a judgment standing against the pensioner.

The inquiry is largely one of statutory construction. And these are the pertinent statutes.

Section 24 of the act respecting executions, as amended by chapter 99 of the Laws of 1933, provides that if, in discovery proceedings had under section 23 of the act, likewise amended by the statute last referred to, it be disclosed that the "judgment debtor is entitled to, and is in receipt of, an income or any property or money or things in action, held in trust for the debtor, except such trust funds as are now exempt by law," the court shall have power "to direct the judgment debtor to make payments at stated periods in installments, and upon such terms and conditions as the said judge may direct, out of such income, on account of said unsatisfied judgment." 2 Comp.St.1910, pp. 2249, 2250, §§ 23, 24, as amended by Pamph.L. 1933, p. 204 (N.J. St.Annual 1933, §§ 71—23, 71—24).

Chapter 113 of the Laws of 1916, as amended by chapter 102 of the Laws of 1933 (the title of which was amended by chapter 214 of the Laws of 1935) makes subject to execution, and a "continuing levy" thereunder until the sum due thereon and the incidental expenses shall have been fully satisfied, "the wages, debts, earnings, salary, income from trust funds or profits due or to become due to said judgment debtor," if the amount thereof shall be $18 or more per week, in the sum prescribed by order of the court in which the judgment was recovered or resides, not to "exceed ten per centum unless the income of said debtor shall exceed the sum of one thousand dollars per annum," in which case payment of a larger percentage may be directed. Pamph.L. 1916, p. 242, § 1, as amended by Pamph.L.1933, p. 210 (N.J. St.Annual 1933, § 71—90; Pamph.L. 1935, p. 508 (N.J.St.Annual 1935, § 71—91 note).

It is argued for the judgment debtor and the Pension Commission that, from reasons of public policy, "pension monies are exempt from execution and garnishment while in the hands of the pension commission," citing Seventy-First Street & Broadway Corporation v. Thorne, 157 A. 851, 10 N.J.Misc. 99; Id., 159 A. 540, 10 N.J.Misc. 457. It is urged that the statute secondly above mentioned modifies only in respect of the "wages and salaries of public officials" the policy declared in Schwenk v. Wyckoff, 46 N.J.Eq. 560, 20 A. 259, 9 L.R.A. 221, 19 Am.St.Rep. 438, and Spencer v. Morris, 67 N.J.Law, 500, 51 A. 470, that "the unearned salary or remuneration" payable to the judgment debtor "for official service due to the public" may not be "assigned by him or withdrawn from his use at the instance of creditors"; and that a pension is a "gratuitous allowance" in which the pensioner has no 'vested right,' and does not fall into any of the statutory categories of "wages, debts, earnings, salary, income from trust funds or profits * * * due and owing to the judgment debtor."

The point is not well made. While a pension is neither "wages, earnings, salary or profits," within the common acceptation and usage of those terms, the pension installments, at least as they accrue, are classable as "debts," within the intendment of the statute. The ordinary legal sense of the term "debt" is an obligation for the payment of money founded upon a contract, express or implied. Turner v. Cole, 118 N.J.Eq. 497, 179 A. 113. Its technical meaning at common law was "a sum of money due by certain and express agreement,"—that for which an action of debt or indebitatus assumpsit would lie. 3 Blackstone's Com. 154; Flanagan v. Camden Mutual Insurance Co., 25 N.J.Law, 506. But it is also used in the larger sense of that which one person is bound to pay to another under any form of obligation. New Jersey Insurance Co. v. Meeker, 37 N. J.Law, 282, 300. This is its general significance. Webster's New International Dictionary (2d Ed.). See, also, 17 C.J. 1371. It is a word of large import; in its popular signification, it includes all that is due to a person "under any form of obligation or promise." Gray v. Bennett, 3 Mete.(Mass.) 522, 526.

In the main, the distinguishing characteristic of such an obligation is that it is for a sum certain, or a sum readily reducible to a certainty. Flanagan v. Camden Mutual Insurance Co., supra. It is an obligation to pay a sum certain, or a sum which may be ascertained by a simple mathematical calculation from known facts, regardless of whether the liability arises from contract or is implied or imposed by law. Stockwell v. United States, 13 Wall. 531, 20 L.Ed. 491; Indian Refining Co. v. Taylor, 195 Ind. 223, 143 N.E. 682, 689; H. G. Kilbourne Co. v. Standard Stamp Affixcr Co, 216 Mass. 118, 103 N.E. 469; State v. Latham, 136 Tenn. 30, 188 S.W. 534; 18 C.J. 3, 4, 6. Whatever the law enjoins one to pay takes the legal classification of a debt. 3 Blackstone's Com. 158.

The action of debt will lie to enforce obligations created by statute for the payment of a sum certain, or a sum that may readily be made certain. Cowenhoven v. Freeholders of Middlesex County, 44 N.J.Law, 232; United States v. Chamberlin, 219 U.S. 250, 31 S.Ct. 155, 55 L.Ed. 204. It lies to recover a statutory penalty, because the sum demanded is certain. Chaffee v. United States, 18 Wall. 516, 21 L. Ed. 908. See Dallas y. Hendry, 3 N.J.Law, 973. And the term, as used in article 1, § 8, of the Federal Constitution, investing the Congress with power to lay and collect taxes, and to pay "the debts * * * of the United States", has been construed to include claims resting upon "a merely equitable or honorable obligation, and not recoverable in a court of law against an individual." United States Sugar Equalization Board v. P. De Ronde & Co. (C.C.A.) 7 F.(2d) 981, 984. It does not matter that the statute imposes the continuing obligation to pay fixed sums at stated intervals. Faw v. Marsteller, 2 Cranch, 10, 23, 2 L. Ed. 191; Hoy v. Hoy, 44 Ill. 469.

It remains to consider the sense in which the Legislature employed this term. The intent of the lawmaker is to be collected from a general view of the whole clause, bearing in mind the occasion and necessity of the law, the mischief felt, and the remedy in view, and that the words used, while ordinarily given their natural meaning, significance, and import, unless terms of art are employed, which are to be given their technical sense, may be enlarged or restricted to effectuate the manifest reason and obvious purpose of the law. Words of doubtful meaning may be made plain by a comparison with other clauses or portions of the same law. State v. Murzda, 116 N.J.Law, 219, 183 A. 305. The word "debt" takes "shades of meaning from the occasion of its use and color from accompanying words." Morrow v. Hayes, 226 Mich. 301, 197 N.W. 554, 555.

Evidently, the legislative purpose was to include all obligations that, like wages and salaries, income from trust funds, and profits, are payable in periodic installments or stated sums at not less than the prescribed minimum rate. It was patently not the intention to limit the operation of the statute strictly to contractual obligations to pay for the judgment debtor's labor or personal service. This is clearly indicated by the inclusion of "debts" and the produce of "trust funds" with wages, salaries and profits "due and owing to the judgment debtor," or which shall thereafter "become due and owing * * * to the amount of eighteen dollars or more per week." Section 1 as amended (N.J.St.Annual 1933, § 71—91). The design manifestly was to reach, for the benefit of the creditor, income payable in installments in the minimum amount, if of the species of the enumerated classes. And it was not the purpose to restrict this remedy to obligations arising ex contractu for, by section 2 (Comp.St.Supp.1924, § 71—9m), it is made applicable to salaries of civil officers, state and municipal; and public offices do not have a contractual basis. Board of Education of Cedar Grove v. State Board of Education, 115 N.J.Law, 67, 178 A. 208. I find no purpose, express or implied, to distinguish between pensions and the forms of income specified in the act. There is no perceivable basis for such a distinction. Of this, more hereafter.

A public pension, while not contractual in nature, is of kin to wages and salaries, in that it is payable in stated installments for the maintenance of the servant after his productive years have ended, and is basically a recompense for past services. It is fairly within the generic statutory class of income payable periodically to the judgment debtor. It was such that the Legislature intended to subject to this special execution. The terms descriptive of the classes of obligation subject to this levy are given character and color by the qualifying clause "to the amount of eighteen dollars or more per week." The associated words indicating the classes, and the qualifying words prescribing the minimum income subject to levy, furnish the key to open the understanding of the...