Harrington v. Dyer

937 A.2d 77, 50 Conn. Supp. 460, 2007 Conn. Super. LEXIS 1939
CourtConnecticut Superior Court
DecidedJuly 27, 2007
DocketFile No. CV-07-5001166-S
StatusPublished

This text of 937 A.2d 77 (Harrington v. Dyer) is published on Counsel Stack Legal Research, covering Connecticut Superior Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Harrington v. Dyer, 937 A.2d 77, 50 Conn. Supp. 460, 2007 Conn. Super. LEXIS 1939 (Colo. Ct. App. 2007).

Opinion

VACCHELLI, J.

This case is an action to collect a debt due on a promissory note made in connection with the sale of a real estate agent’s business. The plaintiff, Patricia Harrington, alleges that she sold her real estate business to the defendant, Kathy A. Dyer, that Dyer executed a promissory note in payment and that Dyer is in default on the note. Harrington has made an application for a prejudgment remedy seeking to garnish 20 percent of Dyer’s net real estate commissions earned, and expected to be earned in the future, up to the total amount of $56,641.67. For the following reasons, the court denies the request to garnish commissions, but otherwise grants the application, but only up to the total amount of $26,641.67.

I

The complaint was previously served and appearances were filed on behalf of the parties. An appearance was also filed for the proposed garnishee, B/W Realty, Inc., doing business as RE/MAX East of the River. The court heard testimony on the application on June 15 and 20, 2007, from the parties, and from the witnesses, Barbara Weinberg, broker at RE/MAX East of the River, and Marilyn Vatteroni, a salesperson at RE/MAX East of the River. The parties subsequently filed briefs. The court finds as follows. Harrington was a real estate salesperson licensed in Connecticut, working for RE/ MAX East of the River, when she met Dyer in 2003. At the time, Dyer was looking to purchase a house for herself. Dyer also had an interest in becoming a real [462]*462estate salesperson and learned that Harrington was planning to move out of state and sell her real estate business. After Dyer studied for, and obtained, a real estate salesperson’s license, the parties began discussing the purchase and sale of Harrington’s business. Those discussions led to the parties’ executing the subject promissory note, and a purchase and sale agreement for the business, both dated October 2, 2004, and Dyer began working as a salesperson at RE/MAX East of the River.

The promissory note, admitted in evidence, required Dyer to pay $60,000 for the business, in installments, plus 3 percent per annum in the event of default. The purchase and sale agreement provided that the seller agreed to sell, and the buyer agreed to buy, assets and materials listed on a schedule one, and transfer would be by bill of sale. The effective date of the agreement was upon execution of the agreement, which occurred on October 2, 2004. RE/MAX East of the River also signed an addendum to the purchase and sale agreement under which it was to withhold 20 percent of Dyer’s net commissions, and pay them to Harrington, in the event Dyer defaulted on the note.

Dyer paid Harrington $5000 on signing and paid another $5000 in 2005. RE/MAX East of the River is also holding another $5000 of Dyer’s net commissions on the basis of Harrington’s declaration of default, but it has not paid it to Harrington pending an order of this court.

The purchase and sale agreement expressly contemplated that Harrington could continue to work as a real estate salesperson, and earn commissions, “until the date Seller moves to North Carolina.” Harrington filed termination papers with RE/MAX East of the River effective June 30, 2005, and continued to earn commissions until she completed her move to North Carolina, which occurred in November, 2005.

[463]*463Harrington’s application for a prejudgment remedy asks for a garnishment against Dyer’s commissions to secure the $50,000 principal allegedly still owed on the note, plus $1641.67 interest and $5000 in attorney’s fees for a total of $56,641.67. Harrington further requested the court to order RE/MAX East of the River to pay her (Harrington) 20 percent of any commissions earned by Dyer until that sum is paid in full as a prejudgment remedy.

II

The first issue is whether the court can order that commissions be garnished and paid to Harrington pending the outcome of the case as requested in the application, or whether the court can only order that the assets be secured pending a final judgment. Ordinarily, in a garnishment, the court can only order that the garnishee secure the assets pending judgment. General Statutes § 52-329. To resolve the issue, Harrington orally agreed at the hearing to amend her application to ask only for an order that the garnishee secure the assets pending judgment. Dyer did not object. That amendment to the application was accepted by the court, rendering this issue moot.

Ill

The second issue is whether commissions earned by a real estate salesperson can be garnished at all. General Statutes § 52-329 provides in relevant part: “[W]hen a debt other than earnings, as defined in subdivision (5) of section 52-350a, is due from any person to such defendant . . . the plaintiff may insert in his writ . . . a direction to the officer to leave a true and attested copy thereof and of the accompanying complaint . . . with such . . . debtor of the defendant . . . and any debt due from any such garnishee to the defendant. . . not exempt from execution, shall be secured in the [464]*464hands of such garnishee to pay such judgment as the plaintiff may recover. . . .” (Emphasis added.)

Under this section, earnings are not subject to garnishment. The definition of earnings, borrowed from General Statutes § 52-350a (5), includes commissions: “ ‘Earnings’ ” means any debt accruing by reason of personal services, including any compensation payable by an employer to an employee for such personal services, whether denominated as wages, salary, commission, bonus or otherwise.” (Emphasis added.)

Whether the commissions of a real estate salesperson are “earnings” exempt from garnishment appears to be an unsettled issue. In William M. Raveis & Associates, Inc. v. Kimball, 186 Conn. 329, 441 A.2d 200 (1982), our Supreme Court allowed a garnishment of real estate commissions without deciding a similar eligibility issue: whether they were “due and owing,” as required by the statute. The court specifically declined to resolve that issue then, because “[a] hearing on a prejudgment remedy application under [General Statutes] § 52-278d is not the occasion to test the plaintiffs rights against the garnishees. The order by the trial court garnisheed whatever debts were due the defendants from the garnishees as of the date of the garnishment. . . . The extent of that seizure, the determination of what debts, if any, were then owed to the defendants, must await either a scire facias hearing under General Statutes § 52-381 . . . or a declaratory judgment under General Statutes § 52-235a. . . . The hearing authorized by § 52-278d is expressly limited to a determination of whether or not there is probable cause to sustain the validity of the plaintiffs claim. The claim to which the section refers is the plaintiffs claim against the defendants, not the plaintiffs claim against the garnishees. Any other interpretation of the section would be inconsistent with the Prejudgment Remedies Act’s repeated insistence upon expeditious resolution of contested [465]*465prejudgment remedy orders.” (Citations omitted; internal quotation marks omitted.) William M. Raveis & Associates, Inc. v. Kimball, supra, 334-36.

William M. Raveis & Associates, Inc., was decided before the legislature carved out the exception for “earnings” from the garnishment statute. See Public Acts 1990, No. 90-149.

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Cite This Page — Counsel Stack

Bluebook (online)
937 A.2d 77, 50 Conn. Supp. 460, 2007 Conn. Super. LEXIS 1939, Counsel Stack Legal Research, https://law.counselstack.com/opinion/harrington-v-dyer-connsuperct-2007.