Case ID: abb-pr-ns_5/html/0090-01.html
Source: Caselaw Access Project
Author: {"author": "Hunt, J. Parker, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

PEOPLE, ex rel. NOEL, against KINGSLAND.
    
      Court of Appeals;
    
    
      January Term, 1867.
    Supplementary Proceedings.—Contempt in Disobeying Injunction.
    A debtor who, after the service of the usual order in supplementary proceedings, enjoining him from disposing of his property, draws out money previously deposited in bank under an account opened in his name “in trust,” and applies a part of such moneys to his own use, or that of his family, is liable to be punished as for contempt therefor.
    He cannot avoid such punishment by urging that he was doing business as agent for his wife, and that the funds were held by him in trust for her. The legal title, nevertheless, under such a deposit in his own name “ in, trust” was in himself.
    Where the amount withdrawn was $356,—Jleld, that a fine of $400 was not unreasonable to indemnify the creditor.
    Appeal from an order fining defendant for contempt.
    This proceeding was instituted in the name of the People on the relation of Auguste Woel and others, against Richard Kingsland, a judgment debtor, against whom the relators had instituted proceedings supplementary to execution.
    The proceedings supplementary to execution were taken under the provisions of the Code of Procedure on that subject, in order to compel the payment of a judgment of §3,384.20, rendered July 7, I860. At the time of serving the order, the relator caused to be served upon the defendant an order in the nature of an injunction order, by which he was forbidden to transfer or make any disposition of his property, or in any manner interfere therewith, until the further order of the court.
    
      The defendant was examined on various days, commencing in October, and ending on the fourteenth of December, 1865. It appeared from his testimony that he had in the Manhattan Bank to his credit, at the time the order was served upon him, the sum óf $546.15, and that during the month of October he drew out upon his check all of this money except a balance of $31.65. The bank account was headed “Manhattan Bank in account with Richard Kingsland, in trust.” It further appeared that the moneys so drawn were drawn upon checks signed by the defendant, individually, and expressed to be for “ family,” for “board,” for “office,” for “diff. on stock,” “Ed. Baldwin.” Upon an order to show cause, the court below adjudged him guilty of a contempt in using this money, and imposed upon him a fine of $1000.
    Upon an appeal to the general term the sum was reduced to $400, and the order was affirmed to that extent.
    
      E. More, for the appellant.
    —I. Mrs. K. claims this money. Defendant concedes it is hers. As between them, her title was perfect. Both dying intestate, it would go to her heirs, not his. The injunction forbids a disposition of his property, not of property which, not being his, may or may not be declared to be hers, as to creditors in a suit where all parties are impleaded, according to the varying views of the court or jury. “ The judge may forbid a transfer, &c., of the property of the judgment debtor” (Code of Pro., § 298). “The judge may order any property of the judgment debtor to be applied towards the satisfaction of the judgment” (Id., § 299). We supposed the law tobe settled, that in this proceeding, where the third party claiming is not a party, and the property is really claimed by such third pary, and the claim acknowledged by the defendant, the court cannot try the question (Rodman v. Henry, 17 N. Y., 482; 12 How. Pr., 209 ; 10 Abb. Pr., 103 ; 23 How. Pr., 423 ; 26 Id., 155 ; 15 Barb., 300; 1 Hilt., 105 ; 2 Id., 95; Teller v. Randall, 40 Barb., 242).
    II. That these marriage gifts were hers at common law is "beyond dispute. They belong to the class of gifts which from their nature are intended for her separate use (Fonbl. Eq., 101, note o ; Graham v. Londonderry, 3 Atk., 193).
    III. The court below assumes that the agency was a pretense. Is it so bald a case that they can dispose of it safely without hearing the claimant, disregard the advice of counsel, and even punish the defendant, and his counsel through him, for misapprehending his rights ? The cash in bank was $546.15, of which $157.50 belonged to Baldwin. Defendant at special term was fined $1000. We were permitted to have a stay of commitment to enable us to bring this appeal, on paying costs, and stipulating to submit the case at first term. If this were a creditor’s bill against Kingsland and wife, her title to this money would be unquestionable on the evidence in this case. To provide such a mode of supporting families in adversity was one of the humane objects the legislature had in Anew in 1860, and especially in 1863. This court has not been slow in carrying out its spirit (Buckley v. Wells, 33 N. Y., 518; Knapp v. Smith, 27 Id., 277). Again, in equity, she Avas a creditor of his to $13,000 and over. She could hold funds deposited to her credit for her on this ground (Schaffer v. Reuter, 37 Barb., 44).
    IV. As a general rule, it will not do to violate an injunction under advice of counsel. It must, however, be clear and explicit (Laurie v. Laurie, 9 Paige, 233 ; Moat v. Holbein, 2 Edw. Ch., 188). Why? To the end that defendant may not violate it through misapprehension. The question in this case is one about which laAvyers and even courts have differed, as in Buckley v. Wells. Plaintiff could have filed his bill against K. and wife, and had an injunction explicit and clear. .Defendant and his counsel did not understand that this injunction reached the property of a third party, which Avas liable to be declared his at the instance of an assailing creditor. Within the spirit of these cases, defendant is entitled to protection in any event
    
      Y. If it shall be urged that the fact that he had his own name up, and a license in his own name operated to estop the wife, we answer: (1.) A broker’s office is on the street. The sign, in that case, only indicates the place where the person is to be found, or receives letters. It is unlike a mercantile business. (2.) There is no proof that Mrs. K. assented to it. (3.) The license had to be in his name. (4.) In any event, plaintiffs,must show that they trusted to such appearances. The evidence does not show, unless indifferently, when plaintiffs’ debt was contracted. The fact 'is, it was one of his old debts, though not put in judgment until 1865. If plaintiffs would estop her, they must show their debt was contracted while this state of things existed. The fact that K. was doing all his business for and on account of his wife, renders it improbable, if not impossible, that this debt was contracted after the summer of 1864, and the examination of defenfendant renders it clear that it was not. The order or judgment should be reversed, with costs to be paid by the plaintiffs, and not be set off against their judgment.
    
      J. T. Glover, for the respondent.
   Hunt, J.

(after stating the facts). —In support of the appeal it is urged that the defendant- was doing business as an agent for his wife, that the money deposited in bank belonged to her, and that since the recent statutes she was authorized thus to transact business, and authorized to employ her husband as her agent for that purpose.

These questions do not arise. If the business had been transacted in the name of Mrs. Kingsland, and the money had been deposited to her credit, a different question would have been presented. The legal title to the money in bank would have been in her. As the case stands, the legal title to the money, and to all of it, was ia the defendant; and the claim of the wife and of Baldwin, so far as they had claims, gave them no legal title to the specific money in bank. If the defendant was in truth acting as the agent for his wife, and all the money under Ms control, either in "bank or upon Ms person, was the result of the business transacted for her, I do not say that she had not an equitable claim to the money. If the u $157.50 paid E. A. Baldwin,” was a balance due to Mr. Baldwin upon sales of stock ,for his account, it is quite certain that he ought to have been paid that amount. But whether, in either of these cases, the creditors would have had an equitable lien upon the specific fund, or whether they were simply creditors at large of Kingsland, it is not now necessary to consider. It is sufficient for the present purpose that the legal title to the money was in the defendant, and that no proceedings had been taken to enforce the equitable claim of any other party. In using and disposing of the money, he violated the injunction order served upon him.

It appears also, from the testimony of the defendant, that Ms funds in bank were in part the produce of his business as a broker ; that he received money for others, and also Ms commissions'; that he did Ms business as a broker in his own name ; that his commission as a broker sometimes amounted to $500 per month, and these funds, as well as the amount of sales of stock, constituted his deposits in bank. Whatever might be the claim of his wife, upon a settlement of his accounts with her as her agent, it is plain that the money thus earned by the services of the defendant, and deposited to his own credit in the bank, was the money of the defendant. When he used this money, as stated in the case, he violated the injunction order forbidding him to interfere in any manner •with the funds or property belonging to Mm.

The order should be affirmed, with costs.

Parker, J.

—The evidence before the justice of the supreme court who made the order adjudging the defendant guilty of contempt in disobeying the injunction order obtained against him, was sufficient to warrant the decision made.

He paid out, after the service of the order upon him, of moneys on hand at the time of such service, over $800. This was money deposited to his credit in the bank, and though the account was kept by the bank with “ Richard Kingsland, in trust,” yet all his deposits were credited to that account. He was doing business as a stock-broker in his own name, and on his own account. If he sold stock for other persons, whether his wife or others, he deposited the proceeds to that account. He also deposited his own earnings, or portions of them, to the same account.

Now, of the $800 expended by him, $350.33 was individually expended for himself and family. The presumption most favorable to the defendant, taking his own theory that the moneys received by him for sales of stocks for his wife and others he held in trust, is, that these expenditures were from- his own portion of the moneys on deposit.

The general term, taking the most favorable view for the defendant, reduced the fine from $1000 to $400. This latter sum was surely not an unreasonable amount to indemnify the relators for the withdrawing of the $356.25 from being applied to their judgment, and to satisfy their costs and expenses of the proceeding.

The order appealed from should be affirmed, with costs.

All the judges concurred in affirming the order.