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Miller v. Miller

1 Abb. N. Cas. 30 Court N. Y. Supreme Court, First District; Special Term, English

Delivered by Barrett, J.

Contents

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MILLER v. MILLER.
N. Y. Supreme Court, First District; Special Term,
June, 1876.

Headnote

Creditor’s Action.—Surplus Income of Trust.—Injunction.— Judgment for Alimony and the maintenance of Children.
Surplus income, actually existing in the hands of trustees, although the trust were created by, or the fund proceeded from, a third person, may be reached by a creditor’s action against the beneficiary and his trustees.
Hann e. Van Yoorhis, 15 Abb. Pr. N. 8. 79, and again in 5 Run, 435; and Miller v. Miller, 7 Run, 208; distinguished.
An evasive denial of the existence of a surplus will not suffice to prevent granting an injunction.
Nor will a general averment of the necessity of appropriating all the income, without specific details.
It seems, that the rule ( 2 B. 8 . 174) protecting income from trusts created by, or funds proceeding from third persons, against creditors’ actions, does not apply against an action to enforce a judgment for alimony and the maintenance of the debtor’s children.
If the complaint alleges that a surplus of income beyond what is necessary for the beneficiary, actually exists in the hands of the trustees, an evasive denial, e. g. a denial that there is a surplus to the amount alleged, and an averment there is no surplus, is insufficient.
Form of a sufficient complaint.in such a case.
Motion to dissolve injunction.
Mrs. Miller brought this action in the supreme court against her former husband, and F. Gr. Smedley, H. E. Crampton, and Charles H. Miller, executors and trustees, under the will of J. Miller, deceased, to reach the surplus of income arising under a testamentary trust for her said former husband, and apply it to pay a judgment for alimony.
The complaint alleged the divorce by a judgment of the N. Y. common pleas, and the award to her of
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the custody of the two children of the marriage; and the allowance to her by the judgment, of three thousand dollars per annum for her alimony, and one thousand dollars additional, per annum, to her for the support of the children; to be paid her in semi-annual instalments of two thousand dollars. That the defendant therein refused to pay the same, and was thereupon convicted of contempt, and fined, and imprisoned. That defendant kept himself concealed to evade service of the decree and demand of payment, thereby putting plaintiff to the expense of such proceedings for contempt. That subsequently the parties agreed on an amendment of the decree, reducing plaintiff’s alimony from three thousand dollars to one thousand dollars, which defendant promised to pay, with the one thousand dollars for the children. That he afterwards refused to pay more than fifteen hundred dollars per annum; and paid only a part of that for the current year; and that the two thousand dollars was barely sufficient for support.
It was then alleged as follows:
“That J. Miller, late of the city of New York, now deceased, was the father of the said [plaintiff’s husband], and died in January, 1874, owning and leaving a large estate, consisting of both real and personal property, and that he left an estate valued at about seven hundred and fifty thousand dollars, as near as she can ascertain the same, and that his will was admitted to probate in the city and county of New York, on January 30, 1874, a copy of which said will is hereto annexed, marked CA, ’ and forms a part of this complaint; and. said defendants, [naming the executors and trustees], were appointed executors and trus- - tees by and in said will. That as near as this plaintiff can estimate the share of said [plaintiff’s husband], the income from which he is entitled to under said will, it is not far from seventy-five thousand dollars.
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“That the said [plaintiff’s husband] is a man of idle and dissipated habits, and indulges to great excess in intoxicating drinks, and spends his money as fast as he gets it, in licentious and intemperate habits, and if money comes into his hands, it is almost immediately squandered.
“ That the payments which have been made under the agreement before referred to, were received by this plaintiff, directly from the trustees and executors under the said will.
“That as plaintiff is informed and believes, said [plaintiff’s husband] was requested by her attorney, in July last, to give an order on said trustees and executors for the amount then due, but he refused so to do, though there was more than sufficient funds in their hands to pay it.
“This plaintiff further shows that she has no money or means with which to support herself and children, nor has she any relatives of sufficient ability to do so, and her needs are very urgent. That much of the time she and her children suffer for the want of necessary food and clothing.
“ That the defendants above named as trustees and executors have entered upon their duties as such, and are acting as such executors and trustees of the share of said [plaintiff’s husband] under said will, and he receives the proceeds and income of his interest in the estate through said trustees.
“ That, as the plaintiff verily believes, unless the said trustees and executors can be restrained from paying the income of said [plaintiff’s husband] over to him, and he from receiving it, and they be directed to pay directly to this plaintiff so much as she is entitled to under said decree of divorce, to wit, two thousand dollars per annum, or the defendants be compelled to secure such payment, this plaintiff nor the children will ever receive anything more of the alimony and
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support given by the said amended or modified decree.
“And plaintiff states that from facts in her knowledge, from the will and other sources, the income of said [plaintiff’s husband] is about five thousand dollars annually. And that he is a young, able-bodied man, about thirty years old, well-educated, and every way able and qualified to earn a livelihood if so disposed, and therefore does not need any portion of the income from said trust fund for his support, but if he required sufficient for maintenance and support, not more than one thousand dollars per annum would be necessary for that purpose, as this plaintiff is informed-, and verily believes ; and that there is and will continuetobe a surplus every year of about four thousand dollars, over and above the amount necessary for his support.
“ Plaintiff further states that as she is informed and believes, there is now a surplus in the hands of said executors and trustees belonging to the said, [plaintiff’s husband], and which he is entitled to receive, of not less than two thousand dollars, and which should be applied toward satisfying her claims set forth herein.
“That on February 7, 1876, the sum of one thousand six hundred and sixty-one dollars and fifty cents was due her from the defendant, under and by said modified decree of divorce, to wit, on unpaid installments the sum of one thousand six hundred and twenty-five dollars, and for interest on the same, thirty-six dollars and fifty cents; and such proceedings were thereupon had, that an order and judgment of the court of common pleas of the city and county of New York, was duly made and entered, and docketed in the clerk’s office of said court of common pleas, on the said February 7, 1876, for the sum of one thousand six hundred and sixty-one dollars and fifty cents, in
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favor of the plaintiff, and against the defendant, and an execution was by said court ordered to issue for the collection thereof; which said judgment was duly obtained, entered, and docketed on said February 7,1876, and afterward and on February 8, 1876, a transcript of said judgment was duly filed in the office of the clerk of the city and county of New York, and said judgment was at the same time duly docketed in the office of the clerk of the said city and county of New York, where said defendant then resided, and now resides ; and thereafter and on the same day, an execution was in due form and manner issued and delivered to the sheriff of the city and county of New York, in favor of this plaintiff, and against the defendant, for the collection of the said sum of one thousand six hundred and sixty-one dollars and fifty cents.”
The complaint then in similar manner alleged docketing and execution in the county of Queens, adding, “said county of Queens being the place where the defendant resides a part of the time.[3]
“ That said executions were duly received by the sheriffs aforesaid, and have been by them duly returned wholly unsatisfied, and said judgment and claim, both principal and interest, remains wholly unpaid and unsatisfied.”
The prayer for relief was as follows:
“Wherefore the plaintiff prays that the income, accumulations, and surplus from said trust estate in the hands of said executors and trustees, or to which said [plaintiff’s husband] is entitled, or which said executors and trustees have a right to pay him, may be applied to the satisfaction of the said judgment, and interest, and costs of this action; and that the defendant, the said executors and trustees, their agents and
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attorneys, may be restrained and enjoined from paying over to the said [plaintiff’s husband], any more of the income or trust funds to which he is or may be entitled under the will of said Miller, and that the said [plaintiff’s husband], his agents and attorneys, be restrained and enjoined from receiving any further sum, part, or portion of his said income from said executors, or from collecting or receiving any more of said income than shall remain after paying the amount due, and to grow due under said modified decree. And that the said executors and trustees may be decreed to pay from time to time directly to this plaintiff, out of such, income, the amount of alimony and support due, and to grow due, to her and her said children, under said amended decree, together with such costs and expenses of this suit as the court may provide, or that the said defendant [plaintiff’s husband], may be adjudged to assign, set apart, or appropriate, or secure, or that this court sequestrate and set apart for this plaintiff, to the use of herself and children, the sum of two thousand dollars annually, out of his said income, or for such other or further order or decrees as the court may see fit to grant, with costs against the defendant [plaintiff’s husband].”
Estes & Barnard, for plaintiff.
The case is within section 219 of the Code of Procedure (see Brooks v. Stone, 11 Abb. Pr. 221 ; Hartt v. Harvey, 10 Id. 321, 329 ). A bill lies to enforce a decree in chancery, (White v. Geraerdt, 1 Edw. Ch. 335 ), after execution returned unsatisfied (Geary v. Geary, below). The surplus cannot be reached by supplementary proceedings (Campbell v. Foster, 35 N. Y. 361 ; Hann v. Van Voorhis, 5 Hun, 425 ).[3] Section 38 of 2 R. S. 174, only protects trust funds against “judgments at law.”
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' The statute of trusts (1 R. S. 728, §§ 57, 63; 1 Id. 773, § 2), and of divorce (2 Id. 145, § 45; 148, § 60), allow the court to sequester this fund. Defendant has a vested and certain interest in it (Graff v. Bonnett, 31 N. Y. 9 , 12). Surplus income of a trust of personalty-may be reached like that from real property (Hallett v. Thompson, 5 Paige, 583, 585; Hone v. Van Schaick, 7 Id. 233, 235; Gott v. Cook, Id. 521, 533; Clute v. Bool, 8 Id. 83; De Graw v. Clason, 11 Id. 136; Bramhall v. Ferris, 14 N. Y. 41 , 47; Graff v. Bonnett, 31 Id. 9). Surplus income means not merely what is unused, but what the court deem not necessary (Rider v. Mason, 4 Sandf. Ch. 350 ; Sillick v. Mason, 2 Barb. Ch. 79 ). The statute of divorce gives the court ample power (Carey v. Carey, 2 Daly, 424 ; Kirby v. Kirby, 1 Paige, 261; White v. Geraerdt, 1 Edw. Ch. 336 ). At common law such a fund could be reached (Bryan v. Knickerbacker, 1 Barb. Ch. 409 ),[3] and the statute relied on by defendant, in derogation of the common law, must be strictly construed. Paying the decree of the court is applying the fund to the use of the beneficiary.
G. W. H. Zeglio, for defendant.

In the previous action between these parties, the general term sustained the order refusing the injunction,[1] upon the ground that an execution had not been returned unsatisfied, on the judgment for alimony in the court of common pleas. That defect having been remedied, the plaintiff again applies for an injunction.

The case, as now presented, is distinguishable from

† † 7 Hun, 208 ; See also Baldwin v. Ryan, 3 Supm. Ct. (T. & C.) 251; Payne v. Sheldon, 63 Barb. 169 ; Sweey v. Sheridan, 37 Super. Ct.

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Campbell v. Foster ( 35 N. Y. 361 ), in that it is not instituted by a receiver appointed in supplementary proceedings, but by a judgment creditor who, following Judge Weight’s intimation in the case cited, now makes the direct “issue upon the amount necessary for the debtor’s support.” In that case, the reporter states, “ Six judges affirm on the ground that the fund cannot be reached.” It is not intimated that the six judges expressed the opinion that the surplus income derivable from the fund could not be reached in a proper suit and with proper averments.

In this respect, the pleader in the present complaint not only accepts Judge Weight’s suggestions, but he directly follows Graff v. Bonnett, 31 N. Y. 9 , 15, where Hogeboom, J., remarks,—“If the interest of the debtor in this property is only subject to the claims of his creditors in a particular contingency, and then only to a limited extent, to wit, on the report of a surplus over and above an amount necessary or proper for his maintenance and support, we cannot infer that such surplus existed, and it was the office and duty of the pleader, by proper averments, to present such fact in the complaint.’’

The present case is distinguishable, too, from Hann v. Van Voorhis ( 5 Hun, 12 N. Y. Supreme Ct. 425),[2] in the fact which is here distinctly averred by the plaintiff, and admitted because not denied by the trustee, that a surplus actually exists.

While the trustees are silent on this subject, the defendant, Miller, is seemingly evasive. At all events, his denial is not distinct and specific. The averment is, that “there is a surplus in the hands of the executors and trustees belonging to said [ plaintiff's husband ], and which he is entitled to receive, of not less than two thousand dollars.”

* Reported in 15 Abb Pr. N. S. 79.

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The denial is of “a surplus now in the hands of said executors and trustees amounting to two thousand dollars; ” and this is coupled with an averment “ that there is no surplus in their hands.” It will be observed that the denial is of a surplus generally, not of a surplus “ belonging to said [plaintiff's hus band]1,” and “which he is entitled to receive.”

But even if he had met the averment squarely, the injunction would not be dissolved because the beneficiary, without furnishing the court with facts or figures, believes his wants to be in excess of the accumulation, and thus feels himself justified in formally denying that in a legal sense, and as he understands it, a surplus exists.

Under such circumstances, the injunction should be retained until the issue on that head can be properly tried.

These views are based upon the treatment of the plaintiff as an ordinary judgment creditor. Whether that is her just position before the court, is certainly a question which is worthy of consideration.

Her judgment is not at law, but in equity, and it is a judgment by which a faithless husband is required to make provision for the maintenance of his children, as well as for the woman he has wronged. Are his children to be treated as judgment creditors also % A rule under the protection of which such a defendant might enjoy the income of one million of dollars quite as securely as the income derivable from the fund in question, while his children of tender years, and former wife, are suffered to want for the necessaries of life, does not seem to have been contemplated by any of the cases, and as an original question, the court should refuse to sanction such injustice, until admonished by an appellate tribunal, that there is no distinction between such an equity judgment and that obtained at law by an ordinary contract creditor.

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The injunction must be limited to enough of the surplus income to cover the plaintiff’s judgment with interest and the costs and expenses of this action (say-two thousand dollars), and as thus limited, it must be continued until the hearing. Ten dollars costs of this motion to the plaintiff.

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