Trowell Trades Supply, Inc. v. Fineline Drywall, Inc., No. S1528-04 CnC 

(Norton, J., Aug. 19, 2005) 

[The text of this Vermont trial court opinion is unofficial. It has been 

reformatted from the original. The accuracy of the text and the 

accompanying data included in the Vermont trial court opinion database is 

not guaranteed.] 

STATE OF VERMONT SUPERIOR COURT 

Chittenden County, ss.: Docket No. S1528-04 CnC 

TROWELL TRADES SUPPLY, INC. 

v. 

FINELINE DRYWALL, INC. 

ENTRY 

 Following a default judgment and an elapsed appeals period, 

Plaintiff Creditor moves for a writ of execution against Defendant Debtor 

and moves for a judgment against Trustee, MacMillin Company. As there 

is no opposition to Creditor’s first motion and the appeals period has 

lapsed, the court grants the motion and shall issue a writ of execution 

against Fineline Drywall, Inc. As to the second question of whether 
Creditor has a right to obtain a judgment from Trustee, a brief review of the 

facts and law is necessary. 

 From an April 15, 2005 default judgment, Creditor has a judgment 

lien of $46,000 on Debtor’s assets. As part of an attempt to secure this 

judgment, Creditor served Trustee with process to secure money that it 

owed to Debtor. 12 V.S.A. § 3013. Prior to this action, Trustee had 

subcontracted with Debtor for drywall work on a number of jobs. Debtor 

did about $15,000 worth of work on the projects but did not finish. At the 

time Creditor served process, Trustee admitted that it owed Debtor $15,000 

for work performed but stated that the sum was not certain as required 

under 12 V.S.A. § 3018 because Trustee had a contractual right to deduct 

completion costs from the amount owed. Subsequently, Trustee made one 

payment directly to an employee of Debtor for $6,000. Trustee now offers 

affidavits and contracts showing that in fact it incurred completion costs of 

$52,000, which exceeded the amount owed and should cancel its balance as 

a trustee. 

 Under the relevant statute, a trustee is liable only for “[a]ny money 

or other thing due the [debtor] . . . provided it is due absolutely and without 

contingency.” 12 V.S.A. § 3018; see also § 3019 (the contingency must 

date from the time of service). Courts interpreting these sections have 

emphasized that a contingency means that the existence and the amount is 

in question and not merely the liability. Ricker v. Lajoie, 314 F. Supp. 401, 

402–03 (D.Vt. 1970). 

 As specific application of this principle, a trustee may deduct from 

its obligation to debtor any demands the trustee has under a contract with 

the debtor. § 3076. This limitation prevents Creditors from selectively 

looking at the debtor–trustee contractual relationship, but it also limits a 
Trustee to contractual relationships when seeking to apply the exception. 

See Johnson v. Howard, 41 Vt. 122, 125–27 (1868) (Town unable to deduct 

taxes owed to cancel trustee process on contractual amounts owed to 

debtor). 

 Here Trustee and Debtor had a contract for a series of projects. 

Trustee’s credit toward debtor was at all relevant times contingent on the 

Debtor either completing the project or for any penalties incurred for 

breach. Trustee has submitted evidence that such penalties, in the form of 

closing costs, were, in fact, incurred because Debtor stopped performance 

and never resumed. None of these obligations were formed after Creditor 

served Trustee with process. What has changed is merely the subsequent 

calculations that Trustee warned in its answer to Creditor’s disclosure. 

Therefore, since the $14,000 was not an amount absolutely due and was 

subject to contractual contingencies allowable under § 3076, Creditor’s 

motion for judgment against Trustee must be denied.

 Finally, Trustee’s payment of $6,000 to an employee of Debtor falls 

squarely into another exception allowed under 12 V.S.A. § 3021. 

Merrimack Sheet Metal v. Liv-Mar, Inc., 147 Vt. 85, 89–90 (1986). This 

exception protects wage payments from the trustee process. While this 

does not apply to profits, it does allow direct payments of wages to 

employees. In this case, Trustee’s payments went directly to an employee 

as payment for work that he performed. By virtue of § 3021, it is protected 

from the trustee process. 

 Based on the foregoing, Plaintiff’s motion is Granted in part and 

Denied in Part. 

 Dated at Burlington, Vermont________________, 2005. 
 ________________________________ 

Richard W. Norton, Judge