Lemagie v. Acme Stamp Works

98 Wash. 34 | Wash. | 1917

Holcomb, J.

Respondent and. cross-appellant moves to dismiss the appeal upon the ground that another garnishee defendant, who appeared in answer to the writ of garnishment against it, was not sex’ved with xxotice of appeal; that garnishee defendant was -in no way interested in the controversy between these parties, and not a party adverse to the appellant or cross-appellant. Seattle Trust Co. v. Pitner, 17 Wash. 365, 49 Pac. 505. The motion is therefore denied.

In answer to a writ of garnishment, sei'ved. upon it by the plaintiff in the principal suit on August 5, 1915, the garnishee appellant, here appealing, on September 11, 1915, by amended answer, alleged that it was not, at the time the amended answer was made, indebted to the defendant Stevens, and that defendant held two certificates of stock in the Acme Stamp Wox’ks, a corporation, of the par value of $100 per share. The amended answer was controverted by plaintiff by affidavit. On January 2, 1916, defendant Stevens filed his claim of exemption for the two shares of stock in lieu of the px'operty enumex’ated in subdivision 4, Rem. Code, § 563, aixd also an oral application for exemption of wages for personal service rendered by him and as the head of a family dependent upon him for support. The matter was presexxted to the trial court for determination upon the following agreed statement of facts: At the time of the service of the wx'it, defendant Stevens was an officer of the Acme Stamp Works and drawing a salary of $150 per month. On August 5, 1915, the day the writ was served on the garnishee defendant, Stevens had ovex’drawn and there had been advanced to him the sum of $368.32, and between August 5, 1915, and September 11, 1915, the date of the amended answer, there had been advanced to Stevens by the Stamp Works the sum of $213.95, which, after allowing him his accrued salary, left him in debt to the Stamp Works on September 11, 1916, in a balance amounting to $357.21, reducing the indebtedness from Stevens to the Stamp Works between August 5 and September 11 the difference between $368.32 and $357.21.

Upon the hearing on the agreed facts, the trial court ordered a judgment granting defendant Stevens the two shares of stock as “lieu” exemption, and further granted him as exempt $106 as wages, and granted judgment against' the garnishee defendant in the sum of $107.95, the difference between the money advanced after the service of the writ on August 5 and until September 11, when the amended answer was filed, and his exemption of wages, the wages being exempted for the month and a fraction, at the rate of $100 per month, to the extent of $106.

The garnishee defendant appealed from that portion of the judgment holding it liable to pay the $107.95 and refusing to dismiss the writ. The plaintiff appealed from that portion of the judgment granting the “lieu” exemption of the two shares of Acme Stamp Works stock. The trial court held in effect, upon the financial transactions shown as occurring after the service of the writ between the garnishee and the defendant, that the garnishee defendant had no right to advance to defendant after garnishment any funds save those which were by law clearly exempt. Rem. Code, § 688. His wages to the extent of $100 only, and not $100 per month, and not $106 for a fraction over a month, were exempt on September 11, 1915, when the amended answer in garnishment was made, by virtue of Rem. Code, § 703, which says that:

“Current wages or salary to the amount of one hundred dollars ($100) for personal services . . . shall be exempt from garnishment, . . . Provided, however, that said exemption shall in no event be allowed out of wages or salary for a longer period than four (4) consecutive weeks.”

These provisions are explicit, need no construction, and cannot be extended by the rule of liberal construction of exemption statutes.

Appellant contends that it was entitled to set off its debt against its employee to the exclusion of the plaintiff in garnishment, under our decision in Frieze v. Powell, 79 Wash. 483, 140 Pac. 690. It was there held that the garnishee’s liability, as fixed by the statutes relating to garnishment, was the indebtedness existing and effects possessed by it as of the date of the writ, and also at the time of the answer in garnishment on which issues were joined. When the writ issued in that case, on August 31, 1912, there was a liquidated settled account, balanced by the garnishee, between the defendant and the garnishee, for debts represented by I. O. U.’s of the defendant and credits of salary earned, showing a net balance due the garnishee on that date of $25.75. Thereafter and until the issues were raised on amended answer, made on October 25, 1912, defendant earned $196.15 salary. He claimed and was allowed the $100 out of the current salary as exempt, and the garnishee was allowed out of the remainder the net balance due it on August 31, 1912, and this court affirmed it.

The obvious distinction between that case and this lies in the fact that in this there was no balanced account between the debtor and the garnishee at the time of the service of the writ. Whatever garnishee owed to the defendant at that time was impounded by the service of the writ, sub j ect to the right of the defendant to claim his lawful exemption of wages. The garnishee admitted its indebtedness to the defendant by paying to him, after the service of the writ, the sum of $213.95. This must be construed as a waiver on the part of the garnishee of any right on its part to balance the account between it and the defendant as of the date of the issuance and service of the writ. Had it balanced its account, or any part thereof, at any moment of time before the issuance and service of the writ, by applying any funds or property in its hands to the payment of any debt it held against the defendant, the property or fund so applied could not have been impounded by garnishment. Not having so applied the fund in its possession, it could not arbitrarily apply funds coming into its possession afterwards up to the time of answering in garnishment, and so pay itself and defeat the garnisheeing creditor. The trial court was, therefore, correct in holding the garnishee liable under the writ for the salary earned during that period, over and above the statutory exemption of $100.

Upon the cross-appeal of plaintiff, the question presented is whether the debtor can claim and hold as exempt the two shares of Acme Stamp Works corporate stock by virtue of the fourth subdivision of Rem. Code, § 563. It is asserted that this question has been determined by this court in Creditors Collection Ass’n v. Bisbee, 80 Wash. 358, 141 Pac. 886. In that case it was decided that a debtor not having, or not wishing to retain, the specifically enumerated animate personal property, could not, under the proviso in that subdivision, retain in lieu of such specific chattels as “other property” money of the value of $250. That case has been severely criticised in In re Crook, 219 Fed. 979, Neterer, District Judge, where the cases cited and relied upon as sustaining the decision in the Bisbee case were analyzed and interpreted differently. In Hills v. Joseph, 229 Fed. 865, on an appeal from a similar decision by Neterer, District Judge, where the debtor selected merchandise from his stock, involving the same subdivision of the exemption' statutes, Rudkin, J., for the circuit court of appeals, also analyzes, and distinguishes the questions involved and constructions in the cases cited in the Bisbee case, and very strongly intimates that the construction determined upon in the Bisbee case was wrong, although he says it “is of course binding upon this court to the extent that money on hand, or money due the householder from a third person, cannot be selected in lieu of the animals enumerated in subdivision 4; but it still leaves open the question as to what is property of like nature and what is the meaning of the rule of ejusdem generis as applied to this statute.” Judge Rudkin quotes the rule stated in 18 Cyc. 1380, that the statutes which create or give the right of exemption to a debtor are held subject to the rule of liberal construction, and cites decisions from this state in support of that rule as follows: Mikkleson v. Parker, 3 Wash. Terr. 527, 19 Pac. 31; Dennis v. Kass & Co., 11 Wash. 353, 39 Pac. 656, 48 Am. St. 880; Puget Sound Dressed Beef & Packing Co. v. Jeffs, 11 Wash. 466, 39 Pac. 962, 48 Am. St. 885, 27 L. R. A. 808; Becher v. Shaw, 44 Wash. 166, 87 Pac. 71, 120 Am. St. 982; North Pacific Loan & Trust Co. v. Bennett, 49 Wash. 34, 94 Pac. 664; State ex rel. McKee v. McNeill, 58 Wash. 47, 107 Pac. 1028, 137 Am. St. 1038. In the course of the opinion it is said:

“The petitioner contends that the householder may select any kind of animate property, because all the property enumerated in subdivision 4 happens to be' of that class. This would no doubt be an easy solution of a rather difficult question; but we are far from convinced that the legislature had in mind any such arbitrary or unreasonable classification as this. The exemption is granted to householders generally, regardless of their occupation, vocation or calling in life, . . . And notwithstanding the fact that the exemption is thus given in general terms and without qualification to all householders, it is safe to say that not one householder in ten can derive any benefit from the statute if construed as contended for by the petitioner. Nor does a proper application of the rule of ejusdem generis lead to any such conclusion. That rule is: ‘That where special words are used, followed by words of more general import, the general words are to be limited to things of the same kind as are described in the special words, unless an intention may be found to extend their meaning.’ 13 Cyc. 1381. In this statute there is found a manifest intention on the part of the legislature to extend the meaning of the special words, because the statute expressly provides that if: ‘The householder shall not possess, or shall not desire to retain the animals above named, he may select from his property and retain other property not to exceed two hundred and fifty dollars coin, in value.’ This provision shows very clearly that the legislature did not intend to limit the rights of the householder by any procrustean rule, for what would it avail him to surrender specific animals if he was required to select other animals of like kind. Furthermore, the particular property enumerated in this statute is itself so diversified that any strict application of the rule of ejusdem generis would seem to be out of the question. What property can be said to be of like kind as cows and their calves, swine, bees, and domestic fowl? The petitioner would divide property into things animate and things inanimate, and asks us to hold that all animate property falls within the rule and all other property without; but we are satisfied that any such construction would do violence to the legislative intent. That body had in mind the unfortunate debtor rather than any particular kind or class of property. It is of little moment to the creditor what kind of property is claimed as exempt, provided its value does not exceed the statutory limit, while some latitude in the choice or selection is indispensable to the debtor if he is to derive any benefit from the statute; First, to enable him to make a selection from property which he may own; and, second, to select such property as will best contribute to the support and comfort of himself and family. We are satisfied this liberty of choice was contemplated by the legislature.”

In the quoted case, the lieu exemption by a bankrupt of merchandise from his stock in trade in place of the animals enumerated in subdivision 4, § 563, supra, was sustained.

The majority of the court as at present constituted are not satisfied with the decision in the Bisbee case. We feel that it is not in consonance with the general rule of liberality in construing exemption statutes and allowances, hei’e and elsewhere. That decision overlooked the obvious intent of the legislature to grant an exemption to any householder of any property to the value of $250, as is manifested very clearly by the alternative provision that if “the householder shall not possess, or shall not desire to retain, the animals above named, he may select from his property” (not such other property, or other such like property) “and retain other property,” etc. There is no need, as stated in effect by Judge Rudkin, for resort to the rule of ejusdem generis to ascertain the intent of the legislature, and furthermore, the enumeration of property in the statute itself was so diversified as to require the interpretation of subsequent general words in their broad sense. 17 Am. & Eng. Ency. Law (2d ed), p. 7; 26 Am. & Eng. Ency. Law (2d ed.), p. 610; 36 Cyp. 1121, 1122..

The purpose of the exemption statutes has long been conceded to be of the beneficent public policy of preventing indigence and encouraging thrift. The broadest interpretation consonant with that policy and with reason and justice should be given such statutes to effectuate their object.

Since no long established public practice has devolved upon the decision in the case of Creditors Collection Ass’n v. Bisbee, supra, and no rule of property has grown up thereon, we feel under no necessity of observing the rule of stare decisis in this case, nor any compunction in overruling it. We feel compelled to overrule that case in order to promulgate the correct rule of law for the future.

The contention of plaintiff on cross-appeal is denied, and the judgment exempting the shares of stock affirmed. The judgment is modified to the extent of disallowing the six dollars salary exempted for a portion of a month not within four weeks, and in all other respects it is affirmed. Neither party will recover costs on appeal.

Ellis, C. J., Mount, Chadwick, Webster, and Parker, JJ., concur.

Main, J., concurs in the result.

Morris, J., dissents.