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GARNISHMENT-AGENT OF DEBTOR

DAKOTA NAT. BANK V. BRODIE

(HUGHES, Garnishee).

Supreme Court of North Dakota. Jan. 10, 1920.

Rehearing Denied March 1, 1920.

(Syllabus by the Court.)

176 N. W. 738.

An agent of the defendant may be held as garnishee for property or moneys of the defendant in his possession.

by a judicial officer in any administration of the law which is effective must be discretionary, and therefore not subject to control by inflexible stautes or rules, and not reviewable. Any such control abolishes discretion, and any such review substitutes the discretion of the appellate Court for the discretion of the trial Court. The injustice often arising can only be understood by those who have carefully studied the course of contested cases and fully realize how little of the flesh and blood of a living trial cling to the dry bones of a judicial record. The law is not an exact science. The administration of justice can never be made infallible while humanity is fallible. The right of a litigated cause can rarely be determined from mere printed words. It can be caught only in the atmosphere of a trial Court room. It is to be read in the glance of an eye, in the quiver of a muscle, the flushing of a brow, the paling of a cheek, the faltering of a tongue-in the thousand things, seeming trivial in themselves, which the most skillful Court reporter cannot transcribe, but which in combination speak in tones so thunderous as to drown the puny efforts of the most vehement advocate. Hence, the rule, too often ignored to the undoing of the blind goddess : that Courts of review will not disturb findings of fact made by those who have seen and heard the witnesses if the evidence be conflicting. The solution of all these difficulties, I contend, is to leave in our trial Courts the widest possible discretion and put upon their benches men of such unqualified ability and integrity as to stamp them in every way fit to be entrusted with such prerogatives. When you have done that, give them such security in their tenure as to guarantee independence, and such compensation for their services as their qualifications merit. Then will "the oppressor's wrongs” and “the law's delay” no longer furnish a sufficient excuse for suicide.

H. P. BURKE. Sterling, Colo.

BRONSON, J. This is an appeal from judgment of the district court in favor of the plaintiff and against the garnishee, the appellant herein. On December 31, 1918, the plaintiff instituted an action to recover the amount of a promissory note made by the defendant, upon grounds of false representations, as alleged that the defendant was the owner of certain lands in McKenzie county. Garnishee process was then served upon the appellant herein, as a garnishee. His garnishee fees were not then paid, but later in the day were tendered to and received by him, but afterwards, in the evening of the same day, he returned such money to the officer.

The appellant principally specifies error upon the grounds:

(1) That the complaint sounds in tort, and not in contract, and therefore the claim was not subject to garnishment.

(2) That the evidence discloses that the garnishee was not indebted to the defendant at the time of the service of the garnishee summons for the reason that previously the bonds had been mailed back to the defendant,

(3) That the garnishee at the time of the service of the garnishee summons was not paid garnishee fees as required by law.

(4) That there is no evidence adduced of the value of the Liberty Bonds.

(5) That in any event the garnishee was a mere agent of the defendant, acting pursuant to instructions, and not liable as a garnishee.

Although, as contended by the appellant, the complaint may be construed as an action in tort, nevertheless the complaint sets forth

facts sufficient to constitute a cause of action property in his possession belonging to his in contract upon a promissory note. The par principal through garnishment proceedings. ties to the main action have permitted it so to Section 7567, C. L. 1913; 20 Cyc. 118. See, also, be construed, and the judgment, in fact, was so Shortridge v. Sturdivant, 32 N. D. 154, 155 V. entered, pursuant to stipulation of the defend W. 20; Petrie v. Wyman, 35 V. D. 126, 143, 159 ant's attorney. Furthermore, the affidavit for N. W. 616. a garnishment in this action, made by the

The judgment is in all things affirmed, with plaintiff's attorney, states that the cause of ac

I costs to the respondent. tion is founded upon contract. In February, 1919, the garnishee made his affidavit denying

CHRISTIANSON, ROBINSON, and BIRDliability. On January 6, 1919, the plaintiff

ZELL, JJ., concur. took issue with such affidavit. Later, in GRACE, J. (dissenting). The evidence is March, 1919, the garnishee made a motion conclusive that at the time the garnishee sumupon the order to show cause for dismissal of mons was served upon the garnishee he had the garnishment, upon the ground that the ac- no property in his possession belonging to the tion was not upon contract. This motion was defendant. denied by the trial court.

On December 30, 1918, the garnishee had by We are satisfied, therefore, upon this record,

United States mail remitted to the defendant that the plaintiff and the defendant had the

the bonds in question. There is no evidence undoubted right to treat this action as an

to dispute this fact. He was not garnisheed action on contract, and that the garnishee after

until the following day. diselosure was not in a position to question the As we understand the matter, there was no nature of the main action, as treated and con- order of the court restraining the garnishee strued both by the parties and the court. See from remitting the bonds as he did, and he had note 13 Am. Dec. 341; 100 Am. Dec. 511; 20 a perfect right to remit the bonds. Hence at Cyc. 1076; Rood on Garnishment, $ 182; Thorn the time of the service of the garnishee sum. v. Wallace, 88 Ili. App. 562, 564; May v. Gesell mons he had no property in his possession schaft, 211 Ill. 310, 71 N. E. 1001.

or under his control belonging to the de.

fendant. Upon the issue that the property was not in the possession of the garnishee at the time of

NOTE-Garnishment of Agent Holding Funds the service of the garnishee summons, the trial

for Specific Purpose.--It is not attempted in this court has found adversely to the contention of

note to treat of agents of corporations being or the appellant. Without reviewing in detail the not garnishable, the authorities on this subject evidence and circumstances necessary to jus being in irreconcilable opposition. The rule as to tify such findings, we are of the opinion that

garnishees of an individual generally is that their there is presented upon this record a question

possession is to be deemed personal. But the

specific purpose bringing about possession in an of fact whether the bonds were in the posses.

agent may qualify this general rule. sion of the garnishee at the time of the service of the garnishee summons, and, upon usual

Thus, where a check was received by a garpresumptions, that the findings of the trial

nishee to be delivered to another, the check being

made payable to the garnishee, this was held not court in that regard should not be disturbed.

a personal possession by him. Campbell v. Hanl'pon this record the contention of the gar

ney, 19 R. I. 300, 33 Atl. 444. The garnishee nishee concerning the payment of garnishee happened to be an agent of a corporation, but fees is without merit. The evidence is fully this fact was not stressed. It was said “the mailsufficient to establish a waiver in that regard.

ing of the check was tantamount to delivery to

the company, and consequently it nor its agent Concerning the question of value, the pre

did not have in their possession any of the persumption obtains that the bonds of our federal

sonal property of defendant.” In Atwood v. Hale, government are worth par value until the con

17 Mo. App. 81, it was ruled that the whole tenor trary is shown. Section 7180, C. L. 1913; Pat of attachment laws and garnishment thereunder terson v. Plummer, 10 N. D. 95, 86 N. W. 111; regards operation on legal property rights, and, Anderson v. Bank, 6 N. D. 497, 72 N. W. 916.

therefore, where there is employment and service

making real possession and control with employer, There is some contention made upon this ap.

the employe is not garnishable. peal that the garnishee was a mere agent of the defendant for a certain purpose, and as

In Skowhegan Bank v. Farrar, 46 Me. 393, it

was said there must be privity of contract, exsuch could not be subject to garnishment. Un

press or implied, between the principal debtor and der our statutes an agent may be liable for the garnishee. And, therefore, it was ruled that where one had possession of mortgaged prop

ITEMS OF PROFESSIONAL erty as agent of mortgagee, he is not chargeable as garnishee of mortgagor "for the obvious rea

INTEREST. son that the inortgagor has not intrusted or placed the property in his hands."

WAR ASSOCIATION MEETINGS FOR 1920In Barker v. Esty, 19 Vermont 131, it was said:

WHEN AND WHERE TO BE HELD. "It has never been considered that trustee process (garnishment process) extended to any other

American-Statler Hotel, St. Louis, Mo., Auclass of debtors or demands than such as are the ordinary result of contract."

gust 25, 26 and 27.

Arkansas-Hot Springs, June 2 and 3. In Penniman v. Ruffles, 6 N. H. 166, a case in which an attaching officer had placed goods

Georgia-Tybee Island, May 27, 28 and 29. with an auctioneer to sell, a third person sought Hawaii-Honolulu, May 26. to reach the proceeds in the hands of the auc Illinois-Hotel Sherman, May 28 and 29. tioneer. The Court held him not liable "as there

Indiana-Indianapolis, July 7 and 8. was no privity of contract between him and the (principal) defendant, and that he should ac

Iowa-Cedar Rapids, June 24 and 25. count to the officer who employed him."

Kentucky-Henderson, July 14 and 15. In Freeman on Executions, § 162, it is said:

Maryland Hotel Chelsea, Atlantic City, N. "Garnishment, whether made under an attach J., June 24, 25 and 26. ment or under an execution, is a legal and not Michigan-Detroit, June 25 and 26. an equitable proceeding."

Minnesota-St. Paul, July 27, 28 and 29. In 20 Cyc. 1018, it is said that property which New Hampshire-Hotel Wentworth, Newhas been turned over to an agent for the pay

castle, June 26. ment of designated creditors notified of such disposition and acquiesced therein, cannot have its

New Jersey-Atlantic City, June 11 and 12. disposition interfered with by other creditors or North Carolina-Asheville, June 29, 30 and claimants. There are numerous cases cited in | July 1. support of this proposition; thus Walton v. Bethune, 37 Ga. 319; Johnson v. Pace, 78 Ill. 143;

Ohio-Cedar Point, July 6, 7 and 8. Van Winkle v. Iowa Iron, etc., Co., 56 Iowa 245, Pennsylvania--Bedford Springs, June 22, 23 9 N. W. 211; Mayhew v. Paine, 42 Me. 296; Col- and 24. lins v. Smith, 78 Mass. 431.

Texas-El Paso, July 1, 2, 3. And where notes or other demands have been West Virginia--Wheeling, July 28, 29. given to an agent for collection, he cannot, prior

Wisconsin-Milwaukee. September 28, 29 and to their collection, be made liable to garnishment. Thus in Mayes (Garnishee) v. Phillips,

30. 60 Miss. 547, where an attorney had been garnished as to possession of promissory notes due by third persons he was undertaking to collect, it was ruled he could not surrender them into the possession of the Court, and it had no power

CORRESPONDENCE. to compel him to collect them.

In Hurbut v. Hicks, 17 Vt. 193, 44 Am. Dec. 329, it was ruled that an attorney only could be SUITS AGAINST RAILROADS UNDER FEDmade liable to trustee (garnishee) process if he

ERAL CONTROL. collects the money after service of the process and previous to the making of his return.

Editor Central Law Journal: But where notes were delivered to an agent

I have just read Br. Edgar Watkins' article with instructions to pay proceeds, when collected, to certain notes, the Court thought it did not 1 in your issue of April 2nd, page 245, relative appear that this was an irrevocable delivery, so to suits against railroads under Federal control. far

ney | I also recall the former article by Mr. Watkins. could be seized under a proceeding in garnishment in a suit against their owner. Clark v.

Mr. Watkins apparently takes the position Cilby, 36 Ala. 652, 76 Am. Dec. 343. This is a that General Order No. 50 of the Director Genbrief case and concerned merely an arrangement eral is not valid because the act of Congress by the principal debtor.

permits causes of action arising during Federal Where an attorney in answering summons in

control to be prosecuted against the carrier. It garnishment, declared on oath that he could not answer without disclosing matters confided to

will be noticed that the act does not say that him in a professional relation, he should be ex suits would be prosecuted against the railway cused. White v. Bird, 20 La. Ann. 188, 96 Am. company but against the carrier and the carDec. 393.

rier during Federal control is the entity oper So it appears that the right of garnishment of ated by the Government. The railroad coman agent is subject to some limitations, where

pany has nothing to do with it. I have never facts may be shown that it interferes unduly with a situation outside of the ordinary relation be

been able to come to any other conclusion than tween a principal and his agent.

C. | the one arrived at in Haubert v. B. & O. R. R..

as the proceeds were concerned, and they

259 Fed. 362. The Court held there that it | LIMITATIONS ON THE POWER TO AMEND would be unconstitutional to make the B. & 0. THE FEDERAL CONSTITUTION. R. R. responsible for the result of the negligence by the Government. It may be that the Gov. | Editor. Central Law Journal: ernment had employed some negiigent servant

I desire through the columns of your widely which the Railroad Company would not have employed, and some other employe or the pub.

read Journal to propound two questions to the lic may have been injured by this negligent

lawyers represented by Mr. Wayne B. Wheeler,

in your Journal of February 27, 1920, and Mr. employe.

William L. Frierson, in the Harvard Law ReI have never been able to understand why

view for March, 1920. plaintiffs persisted in asking judgment against the Railroad Company instead of the Director

Both of those gentlemen concur in Mr. Frier. General, unless the plaintiff was seeking some

son's proposition on page 665, 33 Harvard Law

Review, March, 1920, as follows: ulterior benefit. Suppose in the Haubert case the plaintiff had taken judgment against the "The legislatures of three fourths of the states B. & O. R. R. Company for damage caused by are clothed with the final and absolute power the Director General. The Director General

of determining whether an amendment regular

ly proposed is wise, desirable, or necessary. not being a party to the suit. And now the

When this power has been exerted, as in the Government having relinquished control he ! case of the Eighteenth Amendment, there is could take his execution against the B. & 0. no power in our government to prevent the Company and they would have no defense be

amendment from becoming a part of the Con. cause it is clear that under any system of

stitution." logical reasoning that whatever would be suffi Suppose the legislatures of three fourths of cient to restrain Haubert from having execu the States, after necessary prerequisites have tion would have also been a good defense if in- | been complied with, have ratified a proposed terposed in the suit where judgment was sought. amendment to the Constitution of the United The judgment roll would not show that the States, repealing Article V in toto, and proGovernment had any connection with the cause clamation to that effect has been made by the of action and would not show that the Govern Secretary of State of the United States, what ment was in any way liable and could not | legal redress have the objecting States? show it properly unless the Government had Or suppose an amendment has been proclaimed had its day in court.

as having been adopted by three fourths of While, if the Director General was made the States, which requires representation of a party and makes his defense, then when the States in the Senate to be proportional to Government comes to pay the judgment as it population, what legal redress have the obwould have to do, the judgment itself would | jecting States? show that it was such a judgment that the According to the dicta of Mr. Wheeler and Government would be bound by it.

Mr. Frierson, “there is no power in our Gov. The question as to whether the company or ernment to prevent the amendment from becomthe Government should ultimately pay the | ing part of the Constitution." amount adjudged should be decided in the trial The Constitution nowhere declares that Arwhere the judgment is obtained and it could ticle V cannot be amended or repealed. There not be properly decided unless the Director is nothing sacro-sanct in Article V on its face, General was a party.

and there is no provision in the Constitution When the law provides that suits may be which exempts that article from amendment brought and judgment rendered as provided by more than any other article of the Constitution law it means that the substantial rights of the of the United States. The same power which parties should be decided by the law as it enacted Article V of the Constitution can amend existed prior to Government control. Suppose or repeal it. one cause of action arose in December, 1917, The United States are nothing but a political and another arose in January, 1918, after Gov. or governmental corporation. Like any other ernment control; if both suits were against the corporation, its existence is subordinate to the Railroad, how could we know which one the power which created it; it is not a sovereign, Government should pay?

except in relation to foreign countries. At home, The Government should be bound on the face it is only a creation of the States which are of the judgment.

the only sovereigns. F. H. PRENDERGAST.

FREDERICK G. BROMBERG. Marshall, Tex.

Mobile, Ala.

BOOK REVIEW.

unlikely, however, that this great flood of cases will subside for some time and we may

expect to see fine distinctions made still finer CORPUS JURIS VOLUME 14.

until the dividing of a hair between north and

northwest side will not seem to be an extravThe long looked for volume of Corpus Juris agant simile by which to compare the close on the subject of Corporations has at last ap reasoning of the courts on questions connected peared. It was delayed because of the death with this growing branch of the law. The pubof William Lawrence Clark, to whom the task | lishers of Corpus Juris expect to keep abreast of preparing the article on Corporations had of the new cases by the publication of Annual been assigned. The article on Corporations Annotations. completely fills Volume 14 and will require an Printed on 1,138 pages of thin paper, bound other volume to complete it. This was prob in buckram and published by The American ably unexpected since volumes 15 to 18 were

Law Book Company, New York, prepared and published without making any provision for the subject of Corporations requir. ing more than one volume for its treatment. This will necessitate the numbering of the additional volume which will contain the discussion

HUMOR OF THE LAW. of the last six titles of the subject of Corporations, Volume 14a.

“Poor old Bill ain't 'arf up against it! His The discussion of the rules of law governing

firm 'ave agreed to the strike terms, an' 'is lot this most important of all business organiza

'ave to go back to work.”—Kansas City Star. tions is thoroughly practical. The authorities have been exhaustively cited and analyzed. This analysis, such a valuable characteristic of "Judge, I wish you'd put me on probation." Corpus Juris, is carried out with such detail “How long did I sentence you for?" that almost every possible variation in the ap "One year. But I want to get married." plication of the legal principles applicable to

"You wish me to substitute for a sentence of corporations is set forth and discussed either

one year a sentence for life? That would be in the text or in the notes. To give one in unconstitutional." — Louisville Courier-Journal. stance, the subject of the liability of promoters is treated with a wealth of detail hardly to be found in any other treatment of that important

Smith-I lost my identity for two whole subject.

weeks last summer. The general treatment of the subject is di. Jones-How did it happen? vided into nineteen titles. I, In General; II, Smith-Spent my vacation among wife's relaIncorporation and Organization; III, Corporate tions, where I was simply known as Anna's Existence and Franchise; IV, Defective Incor husband.-Philadelphia Inquirer. poration; V, Promotion of Corporations; VI, Corporate Name, Seal, Domicile and Place of Business; VII, By-Laws, Rules, Regulations and

A few compliments to the men of Salem: Records; VIII, Capital Stock; IX, Subscription “You may know a Salem man when you meet to Capital Stock; X, Transfer, Sale, Mortgage | him in the world over. He carries about him a or Pledge of Stock; XI, Dividends; XII, Mem. little auld lang syne that shows where he came bers and Stockholders. These titles are dis from. Sometimes it is in the cut of his jib, cussed in Volume 14. The following titles will sometimes of his coat, sometimes it is the way be treated in Volume 14a: XIII, Officers and in which he shoots across a street, always slant. Agents; XIV, Corporate Powers and Liabilities; ing, never at right angles, or from his style of XV, Insolvency and Receivers; XVI, Reincor- shortening things in the way he utters some poration and Reorganization; XVII, Consolida familiar words; he never takes off his coat, but tion; XVIII, Dissolution and Forfeiture of his “cote'; he never rides upon the road, but Franchise; XIX, Foreign Corporations. · always 'rode'; and if you should pick up a final

The tremendous importance and vitality of ‘g' in 'ing' you may be sure some of the Salem the subject of Corporations in respect to the people are the unfortunate ones who have number and variety of the legal problems which

dropped it."---Address at the Fifth Half Century it presents is evidenced by the great number Anniversary of the Landing of John Endicott at of cases which are cited in this volume. It is Salem, Sept. 18, 1878.

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