Hornblower & Weeks v. Sherwood

Conway, J.

In March of 1931, a joint legislative committee had been appointed to investigate the affairs of the City of New York. The committee caused a subpoena to be issued for the appearance of one Bussell T. Sherwood so that testimony might be obtained from him. Upon his failure to obey the subpoena a proceeding was instituted on October 30,1931, under section 406-a of the Civil Practice Act to punish Sherwood, who had placed himself beyond the jurisdiction of the State, for contempt. The order required Sherwood to show cause why he should not be punished and directed under section 406-a that his property in the State to the amount of $100,000 “ be levied upon and seized by the Sheriff ’ ’ and held to satisfy any judgment rendered against him in the proceeding. That order was served at once on the plaintiff in this interpleader action, Hornblower & Weeks, a brokerage firm. The service was recorded in the “ Attachment and Beplevin Begister ” of the Sheriff of New York County. Hornblower & Weeks informed the Sheriff that Sherwood’s account showed that a balance was due plaintiff “ against which plaintiff was carrying the stocks then in the account The Sheriff also served copies of the order of October 30,1931, upon banks and brokerage firms other than plaintiff which had possession of Sherwood’s property and from them some $8,000 was collected.

Thereafter an order was entered on January 4, 1932, sustaining the charge of recusancy against Sherwood and imposing a fine of $50,000 and costs. The order further provided that the fine “ be satisfied, unless paid, by a sale of, and out of, the property of the said Bussell T. Sherwood heretofore seized and levied upon by the Sheriff of any County of the State of New York, pursuant to the order * * * dated October 30, 1931 * * (Emphasis added.) The order of January 4, 1932, further provided that Sherwood “ be confined in close custody in the County Jail of the County in which he shall be apprehended, there to remain until the said fine of $50,000 shall be paid to the Comptroller of the State of New York for the benefit of the People of the State of New York and he shall have submitted to examination as a witness before the said Joint Legislative Committee * *

This then was not a fine for a civil contempt by way of indemnity for the benefit of a private litigant but a fine as punishment for a public or criminal contempt. This was a fine for flouting the power of the Legislature of a sovereign State •— the power of one of the three co-ordinate branches of government — which had called for aid upon another co-ordinate branch of government — the judiciary. No better language to describe a criminal contempt, such as that found here may be found than that of our court in People ex rel. Munsell v. Court of Oyer & Terminer of County of N. Y. (101 N. Y. 245, 248-249) as follows; “ The second class of contempts consists of those whose cause and result are a violation of the rights of the public as represented by their constituted legal tribunals, and a punishment for the wrong in the interest of public justice, and not in the interest of an individual litigant. In these cases if a fine is imposed its maximum is limited by a fixed general law, and not at all by the needs of individuals; and its proceeds when collected go into the public treasury and not into the purse of an individual suitor. The fine is punishment rather than indemnity, and if imprisonment is added, it is in the interest of public justice and purely as a penalty, and not at all as a means of securing indemnity to an individual. Necessarily these contempts in their origin and punishment partake of the nature of crimes, which are violations of the public law, and end in the vindication of public justice; and hence are named criminal contempts. As described in the statute, an element of willfulness, or of evil intention enters into and characterizes them. They are a disturbance of the court which interferes with its performance of duty as a judicial tribunal; willful disobedience to its lawful mandate; resistance to such mandate willfully offered; contumacious and unlawful refusal to be sworn as a witness, or to answer a proper question; and publication of a false and grossly inaccurate report of its proceedings, These cases and their punishment are placed under the head of ‘ general powers of the courts and their attributes; ’ and they very evidently relate to public offenses tending to cast discredit upon the administration of public justice, and having no reference to the particular rights of suitors. But here again we find that they occur as well in civil as in criminal actions, and so, for convenience, we may speak of them in view of the present classification, as public contempts, although the established legal nomenclature must remain unchanged.”

A certified copy of the order of January 4, 1932, was immediately served by the Sheriff upon the plaintiff. Within a few days thereafter the Sheriff made demand on plaintiff, stating that a writ of attachment had been served on plaintiff on October 30, 1931, and demanding that plaintiff turn over property or money in its possession belonging to Bussell T. Sherwood. Plaintiff wrote calling attention to its previous letter advising that Sherwood’s account showed a balance due to plaintiff. Three years later the plaintiff notified the Sheriff that the account showed a credit balance of some $3,000. That was not collected. Until the commencement of this action, the Sheriff took no further action. Sherwood has never been apprehended and has given no testimony. There is now a balance due Sherwood of some $38,000.

On September 24, 1952, Sherwood assigned his interest in ‘ ‘ his account with plaintiff ’ ’ to his wife who demanded that the property be turned over to her. She concedes that the assignment was accepted with the knowledge of the prior proceedings. This interpleader action followed. Summary judgment and judgment on the pleadings were rendered for defendants-respondents and affirmed below.

The proceeding resulting in the order of January 4, 1932, was a civil special proceeding resulting in a final order. The appellant concedes that and we are all agreed upon it. (People ex rel. Rochester, Syracuse & Eastern R. R. Co. v. Moroney, 224 N. Y. 114, 124; Matter of Gibson, 195 N. Y. 466.) The appellant insists, however, that, although a final order in a special proceeding, it is a judgment within the meaning of section 44 of the Civil Practice Act and is now conclusively presumed to have been paid after the expiration.of a period of twenty years from January 5, 1932.

Section 44 of the Civil Practice Act reads as follows: “ When satisfaction of judgment presumed. A final judgment or decree for a sum of money or directing the payment of a sum of money, rendered in a court of record within the United States or elsewhere, or a judgment of a court of this state not of record docketed in a county clerk’s office upon a transcript filed therein pursuant to law, is presumed to be paid and satisfied after the expiration of twenty years from the time when the party recovering it was first entitled to a mandate to enforce it. This presumption is conclusive, except as against a person, who within twenty years from that time makes a payment or acknowledges an indebtedness of some part of the amount recovered by the judgment or decree, or his heir or personal representative, or a person whom he otherwise represents. Such an acknowledgment must be in writing and signed by the person to be charged thereby. A person may avail himself of the presumption created by this section under an allegation that the action was not commenced, or that the proceeding was not taken, within the time therein limited.”

The words of the statute are “ judgment or decree ”. They were words of art when written and concededly did not mean nor include a final “ order ”. They were written originally into statute law before the first Code of Civil Procedure in 1848 because of which it came to pass thereafter that actions ended in judgments and special proceedings ended in final orders. It has been so since. Yet we have had a second Code of Civil Procedure adopted in 1876 and 1880 (1 Carmody-Wait on New York Practice, pp. 3, 4) and later our Civil Practice Act but the Legislature has never, in all of those enactments over the years, amended section 44 so as to provide that its applicability should extend also to a final order in a special proceeding. (See Warren v. Garlipp, 217 App. Div. 55.)

It is not that the People and the Legislature overlooked the fact that the Code of 1848 had made a change. The Legislature could have amended the language of what is now section 44 of the Civil Practice Act so as to add the word “ order ” but it was not required to do so unless it thought the amendment necessary or advisable. Before 1848 and the abolition of the distinction between actions at law and suits in equity, the Legislature, when it thought it necessary or advisable, provided for the filing of an order and the consequent docketing of it ££ as if the same was the transcript of a judgment ” and that a certified copy of such order together with other papers ££ shall be the judgment record ”, and that such judgment should be a lien on real estate. (L. 1844, ch. 315, § 8; Gildersleeve v. People, 10 Barb. 35, 43; People v. Lott, 21 Barb. 130, 142; Code Crim. Pro., §§ 593, 595; People v. Wirtschafter, 305 N. Y. 515, 519.) That has never been changed to date. So also after 1848, when the Legislature saw the necessity for providing that an order might be “ deemed a judgment ” or “ docketed as a judgment ”, it so provided. Thus in section 773 of the Civil Practice Act it is provided: ££ A decree or order awarding the payment of money shall be deemed a judgment for the purpose of this article.” (Emphasis supplied.) The article is the one dealing with supplementary proceedings. So also as to condemnation proceedings. Section 17 of the Condemnation Law (derived from Code Civ. Pro., § 3373) specifically provides that the final order in the condemnation proceeding ££ shall be docketed as a judgment * * * and it shall have all the force and effect of a money judgment * * Again in section 1332 of the Civil Practice Act, prior to the enactment of article 78 of the Civil Practice Act, the Legislature made specific provision that in a mandamus proceeding ££ * * * the final order is deemed to be a final judgment * * *.” Finally, as continuing the pointed distinction between judgments and orders, except-when otherwise specifically provided, the People amended the Constitution and the Legislature amended the Civil Practice Act recently so as to provide for both judgment or order absolute (N. Y. Const., art. VI, § 7; Civ. Prac. Act, § 588, subd. 3) when prior thereto there had been provision only for judgment absolute. (See Tenth Annual Report of N. Y. Judicial Council, 1944, p. 369 et seq.)

We must read and follow the plain words of the statute as enacted by the Legislature more than a century ago and never changed. Section 44 of the Civil Practice Act applies a fiction of payment to judgments or decrees in favor of litigants where ordinary money claims have been adjudicated and in other litigation specifically provided for by legislation. It fits into the pattern of government exemplified by the maxim: “ It concerns the welfare of a state that an end be put to litigation (Co. Litt. 303.) It was passed by the Legislature to end litigation where successful litigants had slept on adjudications in their favor for twenty years. Appellant would have us write into the statute the word “ order ”, which the Legislature has omitted, and then apply it, when thus amended, to a situation where we do not think it may properly be said that the Legislature intended to create a fiction of payment so as to presume satisfaction of a claim of the State to a fine in a criminal contempt proceeding imposed to vindicate an affront to the power and authority of the same Legislature when the failure to reduce to possession property available to pay the fine in part was the result of inaction — not by the party litigant — but by employees of the Sheriff over a period of more than twenty years.

I concur also in the concurring memorandum of Judge Froessel as to sections 10 and 54 of the Civil Practice Act.

The judgment should be affirmed, with costs.