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I believe that the prison reimbursement act, Act No. 253, Pub. Acts 1935 (Comp. Laws Supp. 1940, §§ 17667-11 — 17667-16, Stat. Ann. §§ 28.1701-28.1708), as amended by Act No. 272, Pub. Acts 1937 (Comp. Laws Supp. 1940, § 17667-17, Stat. Ann. 1941 Cum. Supp. § 28.1709), imposes a civil liability on all prisoners able to pay whether they were sentenced before or after the effective date of the act, but such liability does not extend to any period of imprisonment prior to the effective date of such act. We stated in the unanimous opinion of the court in Auditor General
v. Hall, 300 Mich. 215, 221 (139 A.L.R. 1022):
"We regard the statutory obligation of a prisoner to pay for his keep and maintenance, if he has a sufficient estate, as civil rather than criminal in character."
We likened it to the obligation of the estate of an insane person to pay for his keep and maintenance. Prior to the enactment of the prison reimbursement act it was the policy of the State of Michigan to
furnish its prisoners such keep and maintenance gratuitously. That policy was changed upon the effective date of Act No. 253, Pub. Acts 1935. A prisoner sentenced before that date had no vested property or contract right to continue to be supported gratuitously even though he had an estate ample to pay for his future keep and maintenance after such date. No obligation was imposed retrospectively.
"A law is not retrospective, in a sense forbidding it, because a part of the requisites for its action and application is drawn from a time antedating its passage." Clearwater Township v.Kalkaska Supervisors, 187 Mich. 516, 521.
That the prison reimbursement act provides for a remedy purely civil in nature is borne out by the fact that whole passages in it are copied verbatim from the act providing reimbursement to the State for maintenance of insane persons confined to State hospitals. It has never been doubted that the latter statute is constitutional, yet, if the proceedings authorized thereunder were criminal in nature, a more flagrantly unconstitutional statute could hardly be imagined, since the visitation of a criminal penalty upon a person simply because he is insane would be a substantive denial of due process of law.
In their pleadings the guardian and the veterans' affairs administrator furnish a statement of the assets of Olezniczak in the guardian's hands. The five items total $3,327.93, and may be grouped as follows:
Group 1: United States Savings Bonds (plus accrued interest unpaid) $ 506.25 United States Treasury Bonds (plus accrued interest unpaid) 1,000.00
Group 2: Cash on deposit in Ionia County National Bank 992.61 Receiver's certificate, National Bank of Ionia, in receivership 29.07
Group 3: Adjusted Compensation (Veterans' bonus) Bonds (plus accrued interest unpaid) 800.00
Both parties agree that no exemption under the Federal statutes relating to veterans can be claimed for the items in Group 1, though they were purchased with funds received by the guardian from the veterans' administration, this question having been settled by Carrier v. Bryant, 306 U.S. 545 (59 Sup. Ct. 707,83 L.Ed. 976). As to the deposits in Group 2, which also are derived from such funds, and as to the bonus bonds in Group 3, a claim of exemption is made both by defendant guardian and by the intervening defendant, the administrator of veterans' affairs. They rely upon 38 USCA, §§ 454a, 618 and 686c. These three sections are from three separate enactments: section 454a is from the world war veterans' act, 1924, as amended; section 618 from the world war adjusted compensation (bonus) act (1924), as amended; and section 686c from the adjusted compensation (bonus) payment act, 1936, as amended. The adjusted compensation bonds in Olezniczak's estate (Group 3) were issued under the authority of the last mentioned act; hence section 686c refers only to them. Section 454a refers to funds derived from the veterans' administration, and, if applicable, covers the items in Group 2, which are derived from pension and insurance payments from the veterans' administration. It is not clear that there are now any funds in Olezniczak's estate to which the exemption provided in section 618 would apply, since, presumably, all such funds were converted into adjusted compensation bonds under
the authority of the adjusted compensation payment act, 1936, and section 686c applies to such bonds. In effect, therefore, we are confronted with the two questions: (1) Does section 454a exempt deposits in banks accumulated from pension and insurance payments from the veterans' administration from the claim of the State of Michigan for reimbursement for maintenance furnished a prisoner in State's prison? and (2) Does section 686c exempt adjusted compensation (bonus) bonds of such prisoner from such claim?
Fortunately, the first question is already answered by our previous decision in Re Lewis' Estate, 287 Mich. 179, where we held that, notwithstanding section 454a, the State of Michigan could obtain reimbursement for the maintenance in State hospitals of Mary T. Lewis, a dependent, incompetent child of a United States military service veteran, from her estate, which consisted wholly of monthly pension payments received by her guardian from the veterans' administration. We held that, as the very purpose of a pension is to provide the beneficiary with support and maintenance, it could not have been the intent of congress to deny the State of Michigan reimbursement for furnishing such support. The Lewis decision has never been overruled by any decision of the United States supreme court, and we adhere to it now. So far as the deposits in bank are concerned, they are not exempt from a claim such as that before us, having been accumulated out of pension and insurance payments, the express purpose of which was to provide the beneficiary (in this case the veteran himself) with needed support. We are mindful that inLawrence v. Shaw, 300 U.S. 245 (57 Sup. Ct. 443,81 L.Ed. 623, 108 A.L.R. 1102), the Federal supreme court held such moneys exempt from taxation under section 454a, but we call attention to the fact that, in
that same case, the court explains the purpose of such pension payments in language which practically reiterates the principle upon which we rested our decision in the Lewis Case. Chief Justice Hughes writes:
"These payments are intended primarily for the maintenance and support of the veteran." Lawrence v. Shaw, supra, 250.
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[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.]
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I believe that the prison reimbursement act, Act No. 253, Pub. Acts 1935 (Comp. Laws Supp. 1940, §§ 17667-11 — 17667-16, Stat. Ann. §§ 28.1701-28.1708), as amended by Act No. 272, Pub. Acts 1937 (Comp. Laws Supp. 1940, § 17667-17, Stat. Ann. 1941 Cum. Supp. § 28.1709), imposes a civil liability on all prisoners able to pay whether they were sentenced before or after the effective date of the act, but such liability does not extend to any period of imprisonment prior to the effective date of such act. We stated in the unanimous opinion of the court in Auditor General
v. Hall, 300 Mich. 215, 221 (139 A.L.R. 1022):
"We regard the statutory obligation of a prisoner to pay for his keep and maintenance, if he has a sufficient estate, as civil rather than criminal in character."
We likened it to the obligation of the estate of an insane person to pay for his keep and maintenance. Prior to the enactment of the prison reimbursement act it was the policy of the State of Michigan to
furnish its prisoners such keep and maintenance gratuitously. That policy was changed upon the effective date of Act No. 253, Pub. Acts 1935. A prisoner sentenced before that date had no vested property or contract right to continue to be supported gratuitously even though he had an estate ample to pay for his future keep and maintenance after such date. No obligation was imposed retrospectively.
"A law is not retrospective, in a sense forbidding it, because a part of the requisites for its action and application is drawn from a time antedating its passage." Clearwater Township v.Kalkaska Supervisors, 187 Mich. 516, 521.
That the prison reimbursement act provides for a remedy purely civil in nature is borne out by the fact that whole passages in it are copied verbatim from the act providing reimbursement to the State for maintenance of insane persons confined to State hospitals. It has never been doubted that the latter statute is constitutional, yet, if the proceedings authorized thereunder were criminal in nature, a more flagrantly unconstitutional statute could hardly be imagined, since the visitation of a criminal penalty upon a person simply because he is insane would be a substantive denial of due process of law.
In their pleadings the guardian and the veterans' affairs administrator furnish a statement of the assets of Olezniczak in the guardian's hands. The five items total $3,327.93, and may be grouped as follows:
Group 1: United States Savings Bonds (plus accrued interest unpaid) $ 506.25 United States Treasury Bonds (plus accrued interest unpaid) 1,000.00
Group 2: Cash on deposit in Ionia County National Bank 992.61 Receiver's certificate, National Bank of Ionia, in receivership 29.07
Group 3: Adjusted Compensation (Veterans' bonus) Bonds (plus accrued interest unpaid) 800.00
Both parties agree that no exemption under the Federal statutes relating to veterans can be claimed for the items in Group 1, though they were purchased with funds received by the guardian from the veterans' administration, this question having been settled by Carrier v. Bryant, 306 U.S. 545 (59 Sup. Ct. 707,83 L.Ed. 976). As to the deposits in Group 2, which also are derived from such funds, and as to the bonus bonds in Group 3, a claim of exemption is made both by defendant guardian and by the intervening defendant, the administrator of veterans' affairs. They rely upon 38 USCA, §§ 454a, 618 and 686c. These three sections are from three separate enactments: section 454a is from the world war veterans' act, 1924, as amended; section 618 from the world war adjusted compensation (bonus) act (1924), as amended; and section 686c from the adjusted compensation (bonus) payment act, 1936, as amended. The adjusted compensation bonds in Olezniczak's estate (Group 3) were issued under the authority of the last mentioned act; hence section 686c refers only to them. Section 454a refers to funds derived from the veterans' administration, and, if applicable, covers the items in Group 2, which are derived from pension and insurance payments from the veterans' administration. It is not clear that there are now any funds in Olezniczak's estate to which the exemption provided in section 618 would apply, since, presumably, all such funds were converted into adjusted compensation bonds under
the authority of the adjusted compensation payment act, 1936, and section 686c applies to such bonds. In effect, therefore, we are confronted with the two questions: (1) Does section 454a exempt deposits in banks accumulated from pension and insurance payments from the veterans' administration from the claim of the State of Michigan for reimbursement for maintenance furnished a prisoner in State's prison? and (2) Does section 686c exempt adjusted compensation (bonus) bonds of such prisoner from such claim?
Fortunately, the first question is already answered by our previous decision in Re Lewis' Estate, 287 Mich. 179, where we held that, notwithstanding section 454a, the State of Michigan could obtain reimbursement for the maintenance in State hospitals of Mary T. Lewis, a dependent, incompetent child of a United States military service veteran, from her estate, which consisted wholly of monthly pension payments received by her guardian from the veterans' administration. We held that, as the very purpose of a pension is to provide the beneficiary with support and maintenance, it could not have been the intent of congress to deny the State of Michigan reimbursement for furnishing such support. The Lewis decision has never been overruled by any decision of the United States supreme court, and we adhere to it now. So far as the deposits in bank are concerned, they are not exempt from a claim such as that before us, having been accumulated out of pension and insurance payments, the express purpose of which was to provide the beneficiary (in this case the veteran himself) with needed support. We are mindful that inLawrence v. Shaw, 300 U.S. 245 (57 Sup. Ct. 443,81 L.Ed. 623, 108 A.L.R. 1102), the Federal supreme court held such moneys exempt from taxation under section 454a, but we call attention to the fact that, in
that same case, the court explains the purpose of such pension payments in language which practically reiterates the principle upon which we rested our decision in the Lewis Case. Chief Justice Hughes writes:
"These payments are intended primarily for the maintenance and support of the veteran." Lawrence v. Shaw, supra, 250.
Though the exemption from taxation and the exemption from creditors' claims appear in the same sentence in section 454a, a decision that pension-derived funds are nontaxable does not mean that they are unavailable for the support of the veteran. Indeed, another way of expressing our Lewis decision would be to say that the State of Michigan is not a "creditor" within the congressional intendment.
The bonus laws, on the other hand, evince a donative intent, rather than an intent merely to support. The size of the bonus given each veteran is made to depend upon factors quite other than his need. The adjusted compensation bonds, therefore, do not come within the reason of the rule announced in the Lewis Case, and we refuse to extend that rule to them. We do not dwell upon the slight difference in wording of the exemption clause contained in section 454a and that in section 686c, but rather stress the difference of congressional purpose in enacting the entirely distinct statutes of which those sections are parts, respectively. The distinction between the two sections is well delineated in the recent excellent decision of the supreme court of Wisconsin in Re Guardianship of Letourneau, 238 Wis. 473
(300 N.W. 248). That case also reaches the conclusion that section 686c exempts bonus bonds from a claim on the part of the Wisconsin department of
public welfare for reimbursement for the institutionalization of an insane veteran.
Roman Olezniczak was sentenced to imprisonment for life February 4, 1921. On August 23, 1923, he was transferred from prison to the Ionia State hospital for the criminally insane, where he remained until April 18, 1924, a period of 7 months, 26 days. Then he was returned to prison. Later, on November 13, 1925, he was again transferred to Ionia, where he remained until January 15, 1938, a period of 12 years, 2 months, 2 days. During this second period of confinement at Ionia, the probate court for the county of Ionia, upon petition of the auditor general and after notice to Olezniczak's guardian, made two orders for reimbursement for Olezniczak's maintenance at Ionia, the first on February 13, 1932, and the second on February 18, 1937. The moneys so ordered to be paid were paid, and now Olezniczak's present guardian claims that the probate court was without jurisdiction to make such orders, and counterclaims in the present proceedings to recover such payments. The circuit court held that the statute of limitations (3 Comp. Laws 1929, § 13976 [Stat. Ann. § 27.605]) barred defendant's counterclaim insofar as it sought recovery of moneys paid under the 1932 order. This was correct.
The 1937 order commanded payment of reimbursement for Olezniczak's hospitalization at Ionia for the interval between the two orders. This five-year interval was part of Olezniczak's second period of hospitalization at Ionia, which commenced on November 13, 1925, when the prison authorities transferred him thither, acting under Act No. 151, § 56, Pub. Acts 1923 (2 Comp. Laws 1929, § 6932 [Stat. Ann. § 14.854]). That section, unlike its
predecessor, Act No. 124, § 27, Pub. Acts 1893 (1 Comp. Laws 1897, § 1980), as amended by Act No. 81, Pub. Acts 1899 (1 Comp. Laws 1915, § 1432), does not contain the sentence:
"The expenses of such insane convict's maintenance and clothing in said asylum shall be charged to the State of Michigan."
Indeed, section 17 of the 1923 act provides the procedure whereby persons admitted to State hospitals for treatment of the insane may, provided they have estates sufficient therefor, be compelled to reimburse the State for the expense of their maintenance. Act No. 151, § 17, Pub. Acts 1923 (2 Comp. Laws 1929, § 6894 [Stat. Ann. § 14.817]). Section 17 begins:
"When such mentally diseased person has been admitted to any of the State institutions named in this act, as a patient."
Section 1 of the act (2 Comp. Laws 1929, § 6878, as amended by Act No. 220, Pub. Acts 1931 [Comp. Laws Supp. 1940, § 6878, Stat. Ann. § 14.801]) names the Ionia State hospital as follows:
"At Ionia, Michigan, a hospital for the humane, curative, scientific and economical treatment of insane persons who have committed or attempted to commit certain crimes as herein set forth, to be known as the Ionia State hospital."
It is not necessary to the existence of a right of reimbursement in favor of the State that an insane prisoner be transferred from prison by order of a probate court. Indeed, a probate court would have no jurisdiction to make such a transfer, since the subject of transfers from prison to the Ionia State hospital is already governed by section 56 of the 1923 act, which is exclusive. Section 17 of
the same act does not discriminate between transfers by the probate court of noncriminal insane persons from private homes to State institutions for the treatment of noncriminal insane persons, on the one hand, and transfers by the prison authorities of insane convicts from prison to the Ionia State hospital, on the other, nor does section 17 even intimate that while the State should have reimbursement in the former class of cases, it shall have none in the latter; on the contrary, section 17 scrupulously avoids all reference to the manner of admission, and simply provides:
"When such mentally diseased person has been admitted to any of the State institutions named in this act, as a patient." (Italics ours.)
The record and briefs inform us that the orders of the Ionia probate court of 1932 and 1937 were based on petitions by the auditor general in which Act No. 217, §§ 17, 19, Pub. Acts 1903 (1 Comp. Laws 1915, §§ 1326, 1328) were referred to as the statutory basis of the reimbursement proceedings. Obviously, Act No. 217, Pub. Acts 1903, could not have been the basis for such proceedings, it having been repealed in 1923 (Act No. 151, § 53, Pub. Acts 1923 [2 Comp. Laws 1929, § 6930 (Stat. Ann. § 14.852)]); yet, even if it had not been repealed, it still could not form the statutory basis of reimbursement proceedings for an insane convict transferred to Ionia, since its applicability is limited to the State institutions enumerated in section 2 (Act No. 217, Pub. Acts 1903 [1 Comp. Laws 1915, § 1311), among which Ionia is not named.
Nevertheless, inasmuch as there was a valid statute under which the probate court for the county of Ionia in 1932 and 1937 could act in awarding the State reimbursement, namely, Act No. 151, § 17,
Pub. Acts 1923 (2 Comp. Laws 1929, § 6894 [Stat. Ann. § 14.817]), we are not disposed to permit the legal error in the auditor general's petitions, however gross, to vitiate the jurisdiction of the court in those proceedings, especially in view of the fact that the attack upon such jurisdiction is, in the case at bar, collateral. Once judgment is rendered, merely formal defects in the pleadings, which do not affect the right or justice of the judgment, may be disregarded (3 Comp. Laws 1929, § 14148 [Stat. Ann. § 27.842]).
From the orders of the probate court no appeal was ever taken. They are, therefore, judgments, and within the protection from collateral attack, even on the ground that the court had no jurisdiction over the subject matter, which we held to be the status of all unappealed judgments in Dodge v. Detroit TrustCo., 300 Mich. 575, 610-612.
The judgment of the circuit court is reversed, and the cause remanded for further proceedings not inconsistent with this opinion. As a public question is involved, no costs will be awarded.
CHANDLER, C.J., and BOYLES, BUSHNELL, and SHARPE, JJ., concurred with BUTZEL, J. WIEST, J., took no part in this decision.