Fingerhut v. Hirsch

182 Misc. 429, 44 N.Y.S.2d 393, 1943 N.Y. Misc. LEXIS 2451
CourtNew York Supreme Court
DecidedSeptember 20, 1943
StatusPublished
Cited by1 cases

This text of 182 Misc. 429 (Fingerhut v. Hirsch) is published on Counsel Stack Legal Research, covering New York Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Fingerhut v. Hirsch, 182 Misc. 429, 44 N.Y.S.2d 393, 1943 N.Y. Misc. LEXIS 2451 (N.Y. Super. Ct. 1943).

Opinion

Waltee, J.

By a judgment entered in January, 1940, in an action by a subcontractor to foreclose his mechanic’s lien, it was adjudged that the contractor had received moneys from the owner and failed to devote the same to the payment of the subcontractors and materialmen and had used them for other purposes, and the contractor was directed to pay to certain named .subcontractors and materialmen specifically stated sums found by the judgment to be due to them. The judgment describes the contractor as a trustee of such moneys under the Lien Law, both in the adjudication and in the direction to pay. By an order subsequently made in February, 1941, a receiver of “ the funds ” received by the contractor from the owner was appointed, and the contractor was thereby directed .to pay to the receiver certain of the sums which the judgment had directed to be paid to the subcontractors and materialmen. Each such sum, however, was specifically stated in the order to be “ for ” a specifically named subcontractor and materialman, and the receiver was directed to pay each such sum to such subcontractor and materialman. The order contains the further provision that any “ balance ” shall be paid by the receiver to the City Treasurer subject to the further action of the court, but as the order had already directed the receiver to pay out all that was directed to be paid to him it is difficult to understand how there ever could be any “ balance

[431]*431Neither the judgment nor the order has been complied with, and this motion to punish the contractor for contempt is now made by the receiver and by the plaintiff in the action in which the judgment was entered.

Investigation reveals the rather astonishing fact that the power of the surrogates’ courts to enforce their decrees directing the payment of money by punishing for contempt is far more comprehensive than the power of this court so to enforce its judgments of a like nature. (Civ. Prac. Act, §§ 504, 505; Surrogate’s Ct. Act, §§ 83, 84; Matter of Kramsky, 172 Misc. 935, per Wingate, S.) Provision is made for the enforcement of both by execution. (Civ. Prac. Act, § 504; Surrogate’s Ct. Act, § 83;) There then follow sections similar in structure and general phraseology which say that there may be punishment for contempt where there cannot be enforcement by execution (Civ. Prac. Act, § 505; Surrogate’s Ct. Act, § 84), which has been uniformly regarded as referring to the character of the judgment entered and never as meaning that contempt proceedings will lie simply because an execution does not produce payment. The section dealing with surrogates’ decrees then goes on to give unlimited power to enforce any decree by punishing for contempt, sometimes before the issuance of an execution and sometimes after the return of an execution unsatisfied (Surrogate’s Ct. Act, § 84; Matter of Kramsky, supra, p. 942), while the section dealing with all other courts of record contains but one exception to what is in effect its broad prohibition against punishment for contempt in failing to obey any final judgment directing the payment of a sum of money, and that exception is that there may be punishment for contempt ‘ ‘ where the judgment requires the payment of money into court, or to an officer of the court; except where the money is due upon a contract, express or implied, or as damages for non-performance of a contract ”. (Civ. Prac. Act, § 505.)

The fact that surrogates’ decrees directing the payment of money generally are directions that fiduciaries perform their fiduciary duties, while, the judgments of other courts of record directing the payment of money generally are merely the enforcement of ordinary contract or tort liabilities, may afford an explanation of how the statute relating to surrogates’ decrees happened to get into a form differing so radically from the statute relating to judgments of other courts of record; and the settled policy of the State that, in general, there shall be no “ imprisonment for debt ” (see Civil Rights Law, § 21; Matter of Reeves v. Crownshield, 274 N. Y. 74) doubtless dic[432]*432tates that there should be some difference between the two things. Nevertheless, this court, as well as the surrogates’ courts, enforces fiduciary obligations, and the surrogates ’ courts, as well as this court, enforce nonfiduciary obligations (Matter of Kramsky, supra) and will do so more in the future than they have in the past (Surrogate’s Ct. Act, § 40, subd. 9). It seems difficult to justify such radically different methods of enforcing judgments and decrees which are in all substantial respects the same, merely because one was made in this court and the other was made in the surrogate’s court.

But despite that difficulty, the fact remains that in respect of judgments of this court (apart, of course, from judgments in matrimonial actions, as to which special provision is made in section 1172 of the Civil Practice Act), it has been repeatedly stated in broad terms that a judgment upon which an execution may be issued cannot be enforced by punishment for contempt, and it has been so held even where the sum directed to be paid had been received by the directed party as a trustee (Harris v. Elliott, 163 N. Y. 269) or as a guardian (Coffin v. Coffin, 161 App. Div. 215) or as an “ agent and trustee ” (Walters v. Reinhoudt, 130 Misc. 745, 746) or where the judgment adjudicated him to be a trustee (Hennig v. Abrahams, 246 App. Div. 621, 622, affd. 270 N. Y. 626); and as all final judgments directing the payment of a sum of money are enforcible by execution (Civ. Prac. Act, § 504), it seems to follow that no such judgment of any court of record other than the surrogates’ courts (except judgments in matrimonial actions) may be enforced by punishment for contempt, no matter how flagrant a violation of sacred fiduciary duty may have induced that judgment, except in the single instance in which the judgment “ requires the payment of money into court, or to an officer of the court ” (Civ. Prac. Act, § 505, subd. 4).

The only case cited or found which might be thought to warrant any qualification of that statement is Mendelsohn v. Rosenberg (248 App. Div. 743), in which the court sustained punishment for contempt in failing to pay money which the judgment found had been received as proceeds of two life insurance policies “ in trust for the use and benefit of plaintiff and all the defendants except appellant ”, even though the court expressed doubt whether the receiver to whom payment was directed could be regarded as an officer of the court within the meaning of subdivision 4 of section 505 of the Civil Practice Act. In that case, however, the court referred to the money, not only as " ear-marked as a specific or particular fund ”, but, [433]*433also, as “ in hand ” (italics supplied). It thus would seem that that case rests upon the distinction between directing a trustee to pay over trust funds which he actually has and directing him to pay the amount of trust funds which he did have and should have but which he actually has diverted and dissipated, and that is precisely the distinction which was noted in Harris v. Elliott (163 N. Y. 269, 275, supra) in connection with the holding in that case that a trustee who had dissipated the fund could not be punished for contempt.

I thus am unable to regard Mendelsohn v. Rosenberg

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273 A.D. 798 (Appellate Division of the Supreme Court of New York, 1947)

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Bluebook (online)
182 Misc. 429, 44 N.Y.S.2d 393, 1943 N.Y. Misc. LEXIS 2451, Counsel Stack Legal Research, https://law.counselstack.com/opinion/fingerhut-v-hirsch-nysupct-1943.