Opinion ID: 1207624
Heading Depth: 1
Heading Rank: 2

Heading: Authority of the Court to Substitute the Cash Deposit for the Garnished Sum.

Text: In the foreclosure action dated July 10, 1967, the court ordered that the cash deposit be left with the clerk of the court for the purpose of satisfying any judgment that may be entered against Mark Construction, Inc., in favor of Shelton Engineering Contractors, Ltd. on appellant's claim upon the contract. By an appropriate order dated the same day and filed in the assumpsit record, the court ordered that the garnished sum be released. The law is quite clear that the cash deposit is conditioned for payment of any judgment on the debt underlying the lien, HRS § 507-45 specifically providing that: Any mechanics' and materialmen's lien which covers an entire subdivision of ten or more lots may be discharged at any time by the owner, lessee, principal contractor, or intermediate subcontractor filing with the clerk of the circuit court of the county in which the property is located or with the assistant registrar of the land court (if registered land is affected), cash in twice the amount of the sum for which the claim for the lien is filed, conditioned for the payment of any sum for which the claimant may obtain judgment upon his claim. Therefore, the court may order that the sum be transferred to the pending assumpsit action. The release of the garnishment fund is another matter, however, because the power to release garnishment funds is extremely limited by the statute. R.L.H. 1955, § 237-1, as amended (HRS § 652-1(d)), provides: (d) Garnishee fund excessive. At any time after service of summons, the court, upon the consent of the plaintiff or upon motion of the defendant or of the garnishee and notice to the plaintiff, shall determine whether the garnishee fund is excessive in amount in comparison with subsection (a) of this section or with the judgment rendered and may thereupon release the remainder thereof from being so secured. Subsection (a) states in part:    The cumulative total value of the fund, in advance of final judgment, shall be no more than shall be sufficient to meet the claim of the plaintiff together with cost and legal interest. Any excess in the fund shall be released by the court pursuant to subsection (d) of this section. No part of the garnishee fund may be otherwise disposed of by the garnishee except as provided in this chapter. Literally speaking, the statutory provisions do not permit the total release of the garnished funds due to substitution by a bond from a suit which has been abated. It is our opinion that in creating this ancillary proceeding to protect creditors, the legislature did not consider every possible situation. The one at hand is certainly unusual in that by the literal interpretation of the statute, the subcontractor would be able to tie up more than $45,000 to satisfy a $14,500 claim. In this day, when equity and law have merged, the solution is a simple one. Common sense and fairness dictate that the trial court exercise discretion in the substitution of funds, provided the parties are not prejudiced. The trial court substituted a $29,000 cash deposit for the $18,000 garnished fund. We fail to see that appellant was prejudiced.