Court Opinion

ID: 5469473
Source: CourtListenerOpinion
Date Created: 2022-01-09 20:24:48.946255+00
Date Added: 2024-06-11T08:33:14.967030
License: Public Domain

By the court,
Bockes, Justice.
Appeal from an order made by a judge of this court, in proceedings supplementary to execution, adjudging the appellants to be in contempt for refusing to answer certain questions put to them *441on their examination before the referee appointed to take and certify the same.
The authority to punish for a contempt in such case, is given by section 302 of the Code of Procedure, which provides that if any person, party or witness disobey an order of the judge or referee, duly served, such person, party or witness may be punished by the judge as for a contempt. The disobedience alluded to reaches the case of a refusal to answer proper questions, as well as to a refusal to appear and submit to be examined.
The question of contempt was properly before the judge for adjudication on the affidavits, without the filing of interrogatories, inasmuch as the matter charged as constituting the contempt was not in dispute before him. It was not denied that the appellants refused to answer certain questions put to them on their examination before the referee. But it was insisted, and it is here urged, that they were not bound to answer them, and that their refusal was therefore no contempt. The refusal to answer being admitted before the judge, the filing of interrogatories was unnecessary. The question was properly and fairly before the officer on the affidavits.
The appellants were not parties to the action in which the proceedings were taken, nor were they parties to the proceedings; but were witnesses in that proceeding under the clause of section 292 of the Code, which provides that on an examination under that section, either party might examine witnesses in his behalf. The subject matter of the examination was the property of the judgment debtor. The examination of the witnesses was of course to be limited to that subject; but it is insisted that the examination is subject also to a further limitation: that having sworn that they owned or claimed title to property obtained by them from the judgment debtor, the witnesses could not be compelled to state or disclose the circumstances of the sale and transfer to them. The creditor urges that being *442authorized to examine concerning the property of the judgment debtor, he may inquire as to its nature, situation and value, and if transferred, may also inquire into the circumstances attending its possession, transfer and sale.
I had supposed that these proceedings were intended, to a considerable extent, as a substitute for the old bill of discovery, now abolished, and that they were adopted as more simple and direct, and less expensive than a formal action. If on examination it should turn out that the judgment debtor had no property; that his transfers had been Iona fide, no further trouble or expense would be incurred; on the contrary, if it should be apparent that the party had property undisposed of, or had disposed of property fraudulently, it might be seized under execution, or an action might be prosecuted by the creditor in his own name, or through a receiver to have the property fairly applied to the satisfaction of the judgment. By this course of proceeding the facts could be determined speedily and with little expense. But if the examination is limited in the way claimed by the appellants, very little is attained by it—substantially nothing—towards the advancement of justice. Such limitation, in my judgment, effectually frustrates the object and advantages intended to be afforded by. those proceedings.
It seems to me, that a fair consideration and construction of section 292, can leave no doubt upon this question. It was, in my judgment, plainly intended to give to the creditor the right to inquire, in these proceedings, into the nature and situation of the property of the judgment debtor, and also into the fairness of his transfers and disposition of it. The section gives the right to examine the debtor “ concerning his property,” and also on such examination to examine witnesses in his behalf; and then provides that no person shall, on such examination, be excused from answering any questions on the ground that his examination will tend to convict him of the commission of a *443fraud ; plainly implying that fraud in the transfer of the debtor’s property may be a subject of examination.
There is nothing in the section which gives a more extended scope of examination against the debtor than against witnesses. Its language is, that under this section either party may examine witnesses in his own behalf, and the judgment debtor may be examined in the same manner as a witness;—and we have seen that fraud is a matter of examination.
The case of Van Wyck agt. Bradley, (3 Code Rep., 157,) has not been generally accepted as an authority. Indeed, it has been almost universally disregarded in practice throughout the state. In Town agt. The Safeguard Ins. Co., (4 Bosw., 683,) Judge Robertson held that, inasmuch as no order could be made to compel a delivery of property, therefore no question could be put to the debtor or a witness to discover or prove fraud.
But the purpose of the examination is not merely to obtain discovery of property in the debtor’s hands or under his control. Other objects, substantial and useful in their results, are within its purview. It is often an important and wholesome object of examination to discover whether a fraud has been perpetrated, so as to determine whether an action should not be brought to correct and punish the wrong. Judge Bosworth remarks, that such an examination (an examination as to fraud) is a fishing .one; that the remedy of the creditor is by a direct action. But I submit that his ruling puts the party to a fishing suit (or to an abandonment of any attempt to collect his debt;) this, too, at great expense, and on uncertainty: all which might and generally would be obviated by a full and fair examination. An honest debtor will not feel that it is unfair in his creditor to demand a disclosure of his situation ; nor should a creditor be regarded as on a fishing excursion, when he takes steps to enforce his right. An honest transferee of the debtor’s property will also be will*444ing to explain to a creditor the circumstances of the transfer, and thus avoid suspicion of dishonesty, as well as the trouble and expense of defending an action. A creditor is not without rights in regard to the property of his debtor, and is entitled to be fully and fairly informed in relation to it, as well by the debtor himself as also by any one who claims it from him by recent transfer. An inquiry by him ought not to be deemed impertinent or meddlesome.
I can entertain no doubt but that the creditor may examine the judgment debtor, and any other person, fully in regard to the circumstances attending the transfer and disposition of his property under proceedings supplementary to execution.
No order can be made directing an application of property towards the satisfaction of a judgment in case any other person claims an interest therein. But this in no way conflicts with the right or purpose of examination under section 292.
The order appealed from should be affirmed, with ten dollars costs and disbursements on the appeal.