author: Soerbo, D. C. J.

text:
    District Court of the First Judicial District of the County of Morris.
    SUBURBAN GAS COMPANY, A NEW JERSEY CORPORATION, PLAINTIFF, v. PHILLIP MOLLICA, DEFENDANT.
    Decided January 26, 1943.
    For the plaintiff, Ghwrles I. Malovany (Michael N. Ghanalis, of counsel).
    For the defendant, William H. Yanowslcy (Marius Grosso, of counsel).
   Soerbo, D. C. J.

On April 8th, 1939, the plaintiff, Suburban Gas Company, a Dew Jersey corporation, and Phillip Mollica, the defendant, entered into a written agreement, the terms and clauses of which may be briefly stated as follows:

(a) The defendant was to permit the Company to connect to his property all necessary equipment needed to supply gas, and the company had the option, upon the expiration of the contract or upon “failure to meet the'terms of this contract,” to remove this equipment; (b) the defendant agreed, further, to purchase his gas requirements from the Suburban Gas Company for a minimum period of three years and thereafter on a year-to-year basis, unless terminated by notice; (c) the defendant agreed to pay the Company for all gas at a specified rate upon demand, with a minimum charge per month of $1.15; (d) for the purposes of installation and maintenance, the defendant agreed that only equipment of the Suburban G-as Company would be used unless the Company indicated otherwise in writing; (e) the defendant also agreed to pay certain installation charges prevailing at the time of his application, and the Company bound itself to “supply the entire gas requirements of the undersigned;” (f) finally, the parties agreed that “Inasmuch as a,ny loss arising from a breach of this agreement would be difficult of determination it is agreed that liquidated damages for any such breach is agreed upon to be fixed at the rate of $2 per month for all unexpired months of the life of this agreement.”

The necessary equipment was installed by the Company to supply liquified petroleum gas to the defendant, but in August of 1941, some eight months before the contract was to expire, the defendant refused to pay the Company the sum of $7.04 due on account after demand made by the Company in accordance with the agreement. On the facts before me, this clearly constituted a breach of the foregoing contract.

The Company instituted the present action to recover the $7.04 due for liquified petroleum gas supplied to the defendant, and also, on another count, sought to recover liquidated damages at the rate of $2 per month for the unexpired months of the life of the agreement, in accordance with paragraph (f) of the contract.

There is no doubt, from the evidence, that the defendant is justly indebted to the plaintiff Company for liquified petroleum gas that was supplied before this action was instituted. The main controversy involves the clause in the contract providing for liquidated damages.

The defendant contends, in effect, that clause (f) should be construed not as a provision for liquidated damages, despite the label given to it by the parties, but in the nature of a penalty, and therefore, under the well established rule in this jurisdiction, it should be given no effect.

The defendant rests his contention that clause (f) constitutes a penalty and not a provision for liquidated damages on two principal grounds:

(1) That the damages stipulated are wholly disproportionate to the probable loss, and therefore the stipulation does violence to the well established rule that the parties to the contract must adhere to the principle of just compensation.

(2) That the contract in question contains numerous covenants of varying degrees of importance, and must therefore be construed as a penalty.

I. Viewing the facts and circumstances of the parties as of the time the contract was entered into, I am convinced that the stipulation for liquidated damages of $2 per month does not appear to be exorbitant. In the first place, the contract itself establishes a minimum charge of $1.15 per month. This charge, I take it, would be the prevailing rate even though the consumer made no use whatsoever' of the petroleum gas during an entire month. Furthermore, as counsel for the defendant concedes in his brief, on page 4, the charges for the consumption of gas during the period of the contract before the breach actually averaged $2.50 per month. It is, of course, settled that in determining whether a provision in a contract is one for liquidated damages or for a penalty, the reasonableness of the sum fixed, viewed as of the time when the contract is made, is the important factor. Borden v. Manley, 127 N. J. L. 461, 463; 23 Atl. Rep. (2d) 281.

It is also true that at the time the parties entered into this agreement there was no way of foretelling just when a breach would occur. There was no precise manner in which to estimate the loss to the Company in trade or profit, or exactly what loss the defendant as a consumer of gas would incur in the event that the Company discontinued supplying him. Ho exact pecuniary standard was available. All of these factors were purely speculative at the time the parties entered into their agreement. Furthermore, it is not unlikely that, although, the defendant was charged for installation of equipment at the time the contract was entered into, it could in no manner fully compensate the Company for the costs of purchasing, setting up and maintaining all the necessary equipment.

In view of all of these facts and circumstances, I do not think that when the parties agreed to liquidated damages of $2 per month, the amount was either exorbitant or extravagant; and, as a matter of fact, I think that in view of the average monthly charge to the consumer, it was exceedingly reasonable.

I conclude also that when the parties made their agreement, the harm that would be caused by a breach thereof was incapable or very difficult of accurate estimation, Restatement of Contracts, A. L. I., § 339 (1) (b), and “not readily susceptible of proof,” Ibid., N. J. Annotations, § 339, citing numerous decisions in this state.

II. In support of the contention that the clause in question should be construed as a penalty and not as one providing for liquidated damages, the defendant relies heavily upon Summit v. Morris County Traction Co., 85 N. J. L. 193; 88 Atl. Rep. 1048; Whitfield v. Levy, 35 N. J. L. 149, and similar cases.

In these decisions the court found that there were several covenants of varying degrees of importance, with liquidated damages provided for in case of the breach of these covenants, and it was held to be a penalty. The reason for the rule is apparent. If a large sum of money is forfeited as damages in the event of a breach of one covenant which is of great importance, and the same is to apply equally to the violation of a very trivial and insignificant covenant, the non-offending party is in truth securing a penal sum, since the loss resulting from the breaches differ in amount.

It is well settled in this state that where the sum fixed as damages is applicable to more than one stipulation in the contract and where the stipulations vary in importance, it is a penalty, without regard to whether it would have been a penalty if applied only to the single breach in question. Restatement of Contracts, A. L. I., N. J. Annotations, § 339, citing Summit v. Morris County Traction Co., 85 N. J. L. 193; 88 Atl. Rep. 1048; L. I. A. 1915E, 385 (Court of Errors and Appeals, 1913); Gibbs v. Cooper, 86 N. J. L. 226; 90 Atl. Rep. 1115 (Court of Errors and Appeals, 1914); Lansing v. Dodd, 45 N. J. L. 525 (Supreme Court, 1883); Whitfield v. Levy, 35 Id. 149 (Supreme Court, 1871); Gheddwick’s Ex’r v. March, 21 Id. 463 (Supreme Court, 1848).

But the plaintiff contends that these covenants, though several in number, are interdependent; in truth, resolve themselves into one and form one focal point: namely, that of supplying fuel for the payment of a certain sum. In support of this suggestion, however, it cites no authorities.

Thus the question in this case is narrowed to a precise issue: Does the contract contain numerous covenants of varying degrees of importance, thereby attaching to it the character of a penalty, or does it contain, in legal effect, a single covenant for the breach of which liquidated damages may be stipulated by the parties?

A superficial examination of the contract in this case would seem to indicate that it comprises a series of covenants, a violation of any one of which would result in- the damages stipulated in clause (f). But looking at the substance rather than the mere form of the agreement, it can hardly be said that this contract involves more than an agreement whereby the defendant gives to the plaintiff Company the exclusive right to supply him with all necessary petroleum gas, including the installation and .servicing of equipment, for which the consumer in turn agrees to pay the Company at a specified rate* upon demand. The case, I think, therefore falls within those decisions, discussed infra, which hold that where there are a series of covenants which call for a single act or several acts which are all part of one complex act, all with one primary purpose, the contract will be construed as providing for one stipulation and the rule that is ordinarily applied to contracts with several covenants is not applicable.

Whether the agreement in question is construed as involving only one stipulation, calling for several acts all related to a single transaction, or as providing for liquidated damages in the event of a breach of the entire contract, the result reached is the same.

(1) The terms of this contract as to liquidated damages and those in the contract in Borden Co. v. Manley, supray decided by the Supreme Court January 3d, 1942, are indistinguishable. In the Manley case the Borden Company entered Into an agreement with Manley whereby it loaned him an electric motor compressor and thermostat, and in consideration, Manley agreed to purchase all his ice cream and frozen commodities from the Borden Company. Paragraph 12 of the agreement reads as follows:

"In the event that the Customer discontinues the sale of ice cream, sherbets and other similar frozen commodities at said address so that the Customer does not require any such commodities, or in case of any other breach of this Agreement by the Customer or upon the issuance of any attachment, execution or like process against the Customer or the Customer’s property or any part thereof or if a petition in bankruptcy is filed by or against the Customer, or if the Customer petitions or applies for any reorganization pursuant to the Bankruptcy Act or any other Act or law, or if a receiver of the Customer’s property or any part thereof is applied for or appointed, or if the Customer makes an assignment for benefit of creditors, the Company, or its agents, shall have the right forthwith to enter upon the premises of the Customer and, without let or hindrance, tahe possession of and remove the said refrigerating equipment, with or without process of law, and the Customer thereupon shall be liable for and pay to the Company as and for liquidated damages the sum of Fifty Dollars ($50) to cover the cost of installation, removal and reconditioning of such equipment, the amount of which damages is not now ascertainable * * (Italics ours.)

It is apparent that there were various methods, some expressed and some unexpressed in the agreement, whereby the defendant, Manley, could terminate the agreement by discontinuing the sale of ice cream and other frozen commodities. It is also significant that the liquidated damage clause included this provision: “or in case of any other breach of this Agreement by the Customer * *

But the central fact was the discontinuance of the sale of the company’s commodities. The contract in the case sub judice has a similar primary purpose. In the Manley case, upon the happening of any of the events stipulated, two things could occur: first, the company could “take possession of and remove” the refrigerating equipment rind, second, the Customer would be liable for liquidated damages in the sum of $50.

In the instant case, the terms of the contract are very-similar. Upon the “failure to meet the terms of this contract,” the company had the right first, “to remove” the equipment, under paragraph (a) and, second, under paragraph (f), the Customer would be liable to pay in liquidated damages the sum of $2 per month for the unexpired months of the term of the agreement.

The only possible distinction that could be made between the two cases is that in the Manley case the company specifies the costs which the liquidated damages . were intended to cover. This does not appear in the contract in the present case, but undoubtedly the parties had a similar intention. Nevertheless, the adjudicated cases on this subject do not make such a specification a prerequisite to the recovery of liquidated damages.

The-court in .the Manley case did not go through a highly technical procedure of calling every act in the contract a separate covenant, but instead, it viewed the contract as a single stipulation with one primary purpose.

But even if the “covenants” in the present agreement are considered as numerous, it can hardly be said (1) that they are “disconnected stipulations;” nor can.it be said (2) that these stipulations are of varying degrees of importance, for a violation of any one of them leads to the same singular fact; namely, that the plaintiff is deprived of the exclusive right to supply the defendant with petroleum gas. Both of these factors are necessary in order for the rule contended for by the defendant here to apply. Borden v. Manley, 127 N. J. L. (at p. 463); 23 Atl. Rep. (2d) 281.

(2)- After stating the rule that where a contract contains several covenants of different degrees of importance and the sum named, is to be paid for the breach of any of them, it will be treated as a penalty, the writer in 15 Am. Jur., Damages, § 253, declares:

“The rule above stated has been held not to apply where the contract has only one primary purpose, regardless of its form * * *” (citing Mattes v. Bairs, 176 Okla. 282; 55 Pac. Rep. (2d) 48, citing R. C. L., Dunlop Pneumatic Tyre Co. v. New Garage and Motor Co. (1915), A. G. (Eng.) 79; Ann. Cas. 1915C 939—H. L. Annotation: L. R. A. 1915E, 389).

(3) Bliz v. Powell, 50 Colo. 482; 117 Pac. Rep. 344; 38 L. R. A. (N. S.) 847. This case involved a contract for employment wherein the employee agreed to do certain specific acts such as to remain sober and make sales of automobiles and, in the event of a breach, liquidated damages was provided for. In its opinion, the court said:

“Where the agreement imposes several distinct duties or obligations of different degrees of importance, and the damages resulting from the violation of some, although not all, are readily ascertainable, the sum to be paid by the party in default is a penalty. But where the covenant is for the purpose of a single act, or several acts, or of several things which are but minor parts of a single complex act, and the damage resulting from a violation of each is wholly uncertain, or incapable of being readily ascertained, and especially where the contract provides that the sum named shall be paid as liquidated damages * * * the sum so fixed in the contract is liquidated damages.” L. R. A. 1915E, 393.

In this case, the contract provided that Powell was to work for Bliz in the latter’s automobile business, to give his whole time and energy to said business, to conduct himself at all times in a sober and gentlemanly manner, to use his best efforts to make sales of automobiles and also automobile equipment. Bliz was to pay Powell for his services at a weekly rate in addition to a commission. In addition to all of these stipulations, there were several other provisions in the contract. Liquidated damages were provided for in the sum of $400 in the event of a breach of the contract.

Counsel in that case, just as counsel in this case, made the same argument in respect to numerous covenants. The court met that argument with these words, 117 Pac. Rep. 344, 346; 50 Colo. 482:

“Plaintiff contends, that the agreement contains numerous covenants of the most varied kind and importance; that for the violation of each, the agreed measure of damages is made to apply with equal force, and that the sum stated as liquidated damages is obviously disproportionate to the actual damages that might result from the violation of either * * *. However, in our opinion, the contract, when the subject-matter is considereddoes not contain “numerous covenants of the most varied hind and importance.” On the contrary, there is no covenant therein which would not necessarily be included in, and covered by, an agreement of the plaintiff to enter the employ of defendant as his agent and representative, in the automobile business for the length of time designated.” (Italics ours.)

(4) Clement v. Cash, 21 N. Y. 253; 48 A. L. B. 909. This case involved a contract which required the plaintiff to pay $4,000, to sign two mortgages, one of them for $3,737 to convey a house and lot, and also to deliver two notes for $500. The contract provided that, if either of the parties failed to perform his part of the contract, he should pay the other $3,000 as liquidated damages. The court held that this was not a penalty, saying:

“The contract in question in legal effect provided but for the performance of a single act on each side, and at the same period of time, viz., the execution and delivery of a deed of the land by the defendant and the payment therefor by the plaintiff. * * * If the defendant failed to convey or the plaintiff to make payment in the way covenanted, there was a total non-performance.” L. B. A. 1915E, 391; 21 N. Y. 353, 260.

Conceivably, the court could have taken each provision of the contract and treated it as a separate and distinct stipulation, instead of as several acts closely interwoven with, part of and inseparable from, a single transaction. But instead, the court construed the agreement as calling for the performance in legal effect of a single act.

The court said, 21 N. Y. (at p. 260) :

“That the defendant agreed to receive in payment for his deed, and the plaintiff to pay, simultaneously with its delivery, the consideration in money and other property, cannot divest what was to be done of the character of a single transaction’’

(5) In L. R. A. 1915E, 389, in the editor’s note to the leading case of Summit v. Morris County Traction Co., supra, the rule is stated as follows:

“When the damages for a breach of all the stipulations are uncertain in their nature and cannot be ascertained, the sum provided for in the contract is held to be liquidated damages. So where the stipulation is construed to he for a single thing, and it will he difficult to ascertain the damages, it will he held liquidated.”

Following the statement of this rule, the annotation cites Cushing v. Drew, 97 Mass. 445, in these words:

“A sale contract of horses and wagons and good will of an express business provided for refraining from that business there as long as the purchaser continued in business there, and provided payment of $900 in case of violation. This was held liquidated damages, as the stipulation was for a single thing, to abstain from interference, and it would he difficult to estimate the damages.”

(6) In the English case of Mercer v. Irving, El. El. & El. 563, cited in L. R. A. 1915E, 389n, a case involving a bond for 300 pounds given not to practice medicine or surgery, or open another pharmacy within a mile of the one sold, Mr. Justice Coleridge said:

“Reliance seems to be placed on the circumstances that some of the matters provided for are slight, and that some breaches of the agreement might even be made unintentionally. There is, no doubt, weight in that consideration; but when we look on the other side, the result seems to be the opposite way. The stipulations are provisions for uninterrupted enjoyment throughout a small area; and they point out how much is to he considered an interruption. It is idle to say that, if the defendant attends a single patient within the area, the loss of the emolument in the particular case measures the damage resulting from the breach.”

(7) In Law v. Local Board of Redditch (1892), 1 Q. B. 127, a contractor on a sewer covenanted to pay on default 100 pounds and five pounds for every seven days the work was. not completed after a certain date. On the surface it was apparent that the agreement contained more than one stipulation, but the court, looking at the substance, said that liquidated damages were payable as to a single event—the non-completion of the work. Kay, L. J., said:

“I cannot agree with the ingenious argument that, because there may be many matters, some very small, which would constitute non-completion, these sums may be regarded as payable on several events. According to that argument, there must he considered to he several different non-completions of the work. There may he different causes of non-completion, hut non-completion is only one single event." L. B. A. 1915E, 394.

(8) In 48 A. L. B. 909, the rule is stated as follows:

“It has been held that, although in form the contract is to pay a gross sum for its breach, and the parties covenant to do several different things, yet, if in legal effect the contract provides only for a single act hy each party, then, notwithstanding its form, it will be upheld as a provision for liquidated damages, the provision in other respects being sustainable as one for liquidated damages. Mundy v. Culver (1854), 18 Barb. (N. Y.) 336. (Italics ours.)

(9) Brownold v. Bodbell, 130 App. Div. 371; 144 N. Y. Supp. 846. This was a contract by an employee to give his entire time as salesman, to perform his work and also to engage in no other business for himself, nor to engage in any business for any other person. The agreement provided for $1,500 as stipulated damages in the event of violation. The court held that the damages stipulated applied to a violation of the whole, and not to a violation of one stipulation. The court said:

'“There is no provision that if the plaintiff should violate any of its provisions, then the plaintiff would be liable for the stipulated damages, but that if the plaintiff should 'violate this agreement," then the stipulated damages should be payable.” (Italics ours.)

The words used in the contract in the instant case are: “a breach of this agreement” and “liquidated damages for any such breach.”

(10) A provision in a contract was held to be for liquidated damages under the following facts, 59 A. L. R. 1143:

“* * * agreement whereby one employed for one year as a designer, to pay $1,000 as liquidated damages in case he fails to give his entire time to his employer, or becomes interested in some other business, Simon v. Linden (1919), 107 Misc. 340; 176 N. Y. Supp. 491 (affirmed without opinion in (1919) 190 App. Div. 899); 179 N. Y. Supp. 951, (affirming (1919) 106 Misc. 387; 176 N. Y. Supp. 257), (the stipulation being meant to apply to a breach of the entire contract, the rule applicable to the breach of one of several conditions of varying importance could not be applied).”

(11) In Philadelphia Dairy Products Co. v. Polin, 147 Pa. Super. 26; 23 Atl. Rep. (2d) 221, the contract provisions were similar to those in the Manley case and in the instant case. The company agreed to sell and the dealers agreed to buy the company’s ice cream and other frozen products to the full extent of their requirements for a term of two years. A definite sum was agreed upon as liquidated damages in the event of a breach of one of the following covenants:

(a) If the dealers neglected or refused to purchase from the company ice cream and other frozen products to the full extent of the dealers requirements; (b) or failed to pay the invoices therefor when due; or (e) discontinued in business in violation of another paragraph of the agreement.

In construing the contract to determine whether it provided for a penalty or liquidated damages, the court declared, 23 Atl. Pep. (2d) 211, 223 :

“The particular breach of contract involved in this case relates only to appellants’ neglect or refusal to purchase appellee’s product for the entire term of the agreement. It is precisely to this breach alone that the provision for liquidated damages applies. A fair and careful reading of the contract supports no other construction.”

* ❖ * ^

These cases and authorities, I feel, are controlling. They call for a rejection of the suggestion that a contract having as its primary purpose a single event, may nevertheless be given a tortured construction by splitting it into a series of minor acts, and blindly applying to it the label of a contract “with numerous stipulations of varying degrees of importance.”

Courts have not indulged in such niceties. It conforms neither to reasoning nor to the purpose which originally motivated courts to adopt the rule that has been heretofore urged. Clement v. Cash, 21 N. Y. 253, 259; Cotheal v. Talmadge, 9 N. Y. 551.

. The general rule is that where a contract contains disconnected stipulations of varying degrees of importance, and liquidated damages have been agreed upon in the event of a breach of any such stipulations, the contract will be construed as providing for a penalty. But where a contract has only one primary purpose, but expressly calls for several acts, which are but minor parts of a single complex act, then regardless of its form, the general rule will not be applied. I conclude, therefore, that the plaintiff is entitled to judgment.

Judgment will be entered for the plaintiff on both counts in the sum of $23.04, $16 as liquidated damages on the first count and $7.04 .as actual damages on the second count, together with interest and costs of suit.


source: Caselaw Access Project

license: Public Domain

text:
    New Jersey Department of Labor, Workmen’s Compensation Bureau.
    LOTTIE WILLIAMS, PETITIONER, v. LESLIE M. JACOBS ET AL., RESPONDENTS.
    Decided April 6, 1943.
    For the petitioner, Harry Edelson.

    For the respondent, Proctor & Nary (Thomas D. Nary, of counsel).
   Petitioner testified in her own behalf that she’had on several occasions taken care of a small child of respondent during the evenings when respondents were away from home and was paid fifty cents for her services on each occasion. She further stated that there was no understanding between her and respondents as to when such services might be required but that they came for her whenever they might desire her and that on the final occasion when she suffered injuries herein sued for she did not know if they would ever re-hire her. Petitioner was injured in a fall while alighting from respondent’s automobile at her home where they had conveyed her after completion of her duties as above on the day of the accident, November 2d, 1941.

At the conclusion of petitioner’s testimony respondent moved for dismissal on the grounds that the employment shown was casual in nature within the meaning of the Compensation Law and petitioner did not, therefore, come within the purview of that act.

In brief filed by petitioner’s attorney claim is made that this employment came within the business of the respondents in the sense that it was their business to raise their children and to provide for their proper care and protection. This contention, however, I find to be untenable as the legislature undoubtedly used the word business in the statute in the sense of a commercial enterprise for if it did not there would have been no need to distinguish between employment in connection with the employer’s business and employment not in connection with any business of the employer in defining casual employment. I find accordingly that the employment of petitioner was not in connection with any business of the respondent and the proofs do not establish that the employment, was regular, periodic or recurring, but rather the contrary. In fact this case is alike in many respects to that of Gray v. Greenwood, 129 N. J. L. 596.

I do, therefore, find and determine that the employment of this pettitioner with respondents was casual and she is not entitled to the benefits of the Compensation Law and that judgment should go for the respondent.

It is, therefore, * * * ordered that the petition filed herein be and it hereby is dismissed.

Harry H. TTmberger, Deputy Commissioner.


author: Stein, Y. C.

text:
    Docket 149/168
    J. Hutchison Mitchell, complainant, v. New Brunswick Trust Company, executor and trustee of the last will and testament of Jacob V. Rue, deceased, and Matilda R. Hoffman, defendants.
    [Decided May 11th, 1943.]

      Mr. Clifford I. Yoorhees, for Ihe complainant.

      Messrs. Hicks, Kuhlthau, Thompson & Deshler, for the defendant New Brunswick Trust Company, executor, &e.

      Mr. J. Richard KafeSj for the defendant Matilda R. Hoffman.
   Stein, Y. C.

Jacob Y. Rue died April 23d, 1931. In his will he provided:

“Fifth—I give, devise and bequeath unto my beloved wife, Sarah L. Rue, my dwelling where I now reside, located on Buekelew Avenue in the Borough of Jamesburg, Middlesex County, New Jersey, to have, hold, receive,' use and enjoy the rents, issues and profits thereof for and during the term of her natural life; and from and after her death, I give, devise and bequeath my said dwelling unto my two daughters, Matilda R. Hoffman and Alice V. Rue, to them and to their heirs and assigns forever.”

In the sixth paragraph he gave all the rest, residue and remainder of his estate to his executor and trustee, Hew Brunswick Trust Company, in trust, for the following uses: To pay to his wife from the net income thereof the sum of $900 per year from the date of his death, payable quarterly during the term of her natural life, and the balance of the net yearly income to his two daughters, Matilda B. Hoffman and Alice Y. Bue, in quarterly payments from the date of his death, for and during the life of his said wife. After the death of his wife, to pay the entire net income of the trust to his two daughters, Matilda B. Hoffman and Alice Y. Bue, in quarterly payments, in each and every year until January 3d, 1950.

In the event that either of his daughters predeceased his wife or died before January 3d, 1950, leaving lawful issue surviving, then to pay to the lawful issue of such deceased daughter one-half of the net yearly income of the trust in quarterly payments until January 3d, 1950. ■

If his wife died before January 3d, 1950, then on and after January 3d, 1950, to pay over to his two daughters, Matilda B. and Alice Y., the principal of his trust estate, together with any accumulations of income thereon.

In the event that either of his daughters predeceased him, or in the event that either of his daughters predeceased his wife, leaving lawful issue surviving, then on January 3d, 1950, or on the death of his wife, as the case may be, to pay the one-half part of the principal of the trust, together with any accumulations of income thereon, to the lawful issue of such deceased daughter.

The widow, Sarah L. Bue, died July 3d, 1934; the daughter, Alice Y. Bue (Mitchell), wife of the complainant, died intestate on March 10th, 1934, prior to the death of her mother, leaving lawful issue, Alice Y. Mitchell, an infant, and complainant, J. Hutchison Mitchell, her husband, her surviving.

Hew Brunswick Trust Company, executor and trustee, as directed in the will of the testator, paid income to Sarah L. Rue and Alice V. Rue (Mitchell) during their lifetimes, and after the death of said Alice Y. Rue (Mitchell) to The First Hational Bank of Bellefonte, Pennsylvania, the guardian of said infant, Alice Y. Mitchell, from October 26th, 1934, to March 1st, 1941. The infant, Alice Y. Mitchell, died intestate, a resident of Centre County, Pennsylvania, on or about March 27th, 1941, leaving her surviving only her father, J. Hutchison Mitchell, the complainant, and her maternal aunt, Matilda R. Hoffman.

The estate consists entirely of personalty with the exception of the dwelling house in Jamesburg.

The bill of complaint is filed for construction of the will of decedent and for a declaration of the complainant’s rights thereunder.

Complainant claims to be entitled to one-half of the income of the trust from the date of the death of his daughter Alice and to one-half of the principal of testator’s estate on January 2d, 1950, and alleges that the Hew Brunswick Trust Company as executor and trustee has refused to recognize such right in him.

By the will of the testator it was his expressed intention to carve out a life estate in favor of his widow with the remainder over to his two daughters and their heirs and assigns. In such case the gift of the remainder is deemed vested immediately in the absence of some controlling equity or some evidence in the will from which a different intent is implied. Simpkins v. Simpkins, 131 N. J. Eq. 227; 21, Atl. Rep. (2d) 821, and authorities cited.

So far as concerns the real estate the descent of the same is governed by the law of the state in which it is situated. Testator’s daughter, Alice Y. Rue, died intestate prior to the death of her mother leaving Alice V. Mitchell an infant as her only heir-at-law, and by R. S. 3:3-2; N. J. S. A. 3:3-2, the real estate descended upon the death of Alice Y. Rue to her daughter, Alice V. Mitchell, and by R. S. 3:3-6 and R. S. 3:3-8; N. J. S. A. 3:3-8, it descended upon the death of Alice Y. Mitchell an infant intestate to her maternal aunt, Matilda R. Hoffman, under the facts stipulated in this case.

It is stipulated that Alice Y. Mitchell died a resident of the State of Pennsylvania, and her interest in the personal property is governed by the law of distribution of that state. The statute of Pennsylvania entitled “An act relating to the descent and distribution of the real and personal property of persons dying intestate; and to provide for the recording and registering of the decrees of the Orphans Court in connection therewith, and the fees therefor” provides:

“Section 8. In default of issue, as aforesaid, the real and personal estate of such intestate not hereinbefore given to the surviving spouse, if any there be, shall go to and be vested in the father and mother of such' intestate; or, if either the father or mother be dead at the time of the death of the intestate, the parent surviving shall take such real and personal estate.”

Decree in accordance with the foregoing.


author: Plannagan, C. P. J.

text:
    Essex County Court of Common Pleas.
    MARY F. GRAY, PETITIONER-APPELLEE, v. HERBERT AND FRANCES GREENWOOD, RESPONDENTS-APPELLANTS.
    Decided November 7, 1941.
    Note—This ease having been affirmed in the Supreme Court and the opinion reported at 129 M. J. L. 596, we print the opinion rendered in this court.
    Por the petitioner-appellee, Harry OoJm.

    Por the respondents-appellants, Arthur Mead.

   Plannagan, C. P. J.

This is an appeal from an award in the Workmen’s Compensation Bureau in favor of petitioner.

The petitioner, Mrs. Gray, is a seamstress and dressmaker by occupation. She was accustomed to do her work at her home, the work being brought there by her customers, but as an accommodation at times did the work at her customer’s homes.

The occupation of the respondent, Mrs. Greenwood, is that of housewife.

Petitioner had, at the time of the accident in question, known Mrs. Greenwood for some 35 years, having worked in respondent’s family for her mother.

On the occasion of the accident, which occurred January 12th, 1940, Mrs. Greenwood had, in her house, work requiring the attention of a seamstress, altering and mending, which had accumulated since October, 1939. Respondent had employed petitioner before to work in petitioner’s home as well as in respondent’s home; the work in respondent’s home having been done on August 17th, December 23d, and December 24th, of 1938, and the work in petitioner’s home having been done on March 25th, 1938, and on four occasions between December 23d, 1938, and January 12th, 1940.

Other seamstresses had been employed from time to time by Mrs. Greenwood at her home at 35 and 50 cents per hour. The petitioner’s employment was at $4 per day and was for a single day.

On January 12th, 1940, Mrs. Greenwood met Mrs. Gray by previous appointment at the railroad station in Maplewood, and pursuant to previous understanding was driving- her in her auto to the Greenwood home to do the seamstress work above referred to, which had accumulated there. The streets were slippery and on reaching the house adjacent to her own Mrs. Greenwood found she could not get her auto to her own driveway. She thereupon suggested to Mrs. Gray that she make her way to the house on foot, while Mrs. Greenwood parked the car and followed. There was ice on the sidewalk in front of the house next to Mrs. Greenwood’s house, and in passing over this ice in order to reach the Greenwood entrance Mrs. Gray slipped and fell and sustained the injuries for which she now seeks compensation.

Only one point is raised here which presents difficulty, viz., the claim of respondents that the employment was casual.

The meaning of the words "Casual Employment” presents great difficulty. Casual is defined in Dunk and Wagnall’s Dictionary as “Occurring by chance or accident or without design; accidental; unexpected.” In 1 Words and Phrases (3d and 4th Series) we find about eighty attempts by various courts of the. country to clarify and explain it. Our own legislature, in an effort to simplify or circumscribe its meaning when applied to an employment disconnected with any business of an. employer, defined it in a negative way as, “an employment not regular, periodic or recurring” (Workmen’s Compensation Act, section III, paragraph 23c), and our Court of Errors and Appeals, in further explanation, says that the “Employment is regular when it is steady and permanent for more than a single piece of work; recurring when the work is to be performed at some future time by the same party, without further engagement; and periodic, when the work is to be performed at stated intervals without further engagement,” Forrester v. Eckerson, 107 N. J. L. 156 (at p. 158) ; 151 Atl. Rep. 639.

In Hubbe v. Lynch, 36 N. J. L. J. 86, Judge Martin, in speaking of the word “casual,” says: “There does not seem to be any satisfactory definition in the text books. Dawbern, in his work on Employer’s Liability and Workmen’s Compensation, 94-97, seems to reach the conclusion that the word “casual,” as used in the statute, is the opposite o£ “regular, periodic or permanent,” but shows that even this is not a clear test. It would seem that the best method of ascertaining whether any employment is casual is to take into consideration all the circumstances attending the contract of hiring and the nature of the services in each case.”

Certain indicia of the quality “casual,” as applied to employment, seem to be indicated in the many eases on the subject. Similarly, many “badges” or indicia have been indicated in the books as pointing to fraud.

In the case of Stillman v. Judges of the Court of Common Pleas, 6 N. J. Mis. R. 6; 139 Atl. Rep. 705, the employment was to do “work of a kind usually done by petitioner,” viz., housework; it was for a fixed time, “at least” two weeks, and longer if circumstances required. The occasion for the employment was an operation upon the mistress of the household for appendicitis.

The indicium of the casual quality of the employment in that case seems to be the attack of appendicitis affecting the mistress of the house, patently an unusual, irregular and unexpected event, never recurring if the appendix is removed. The indicia of the non-casual quality of the employment seem to be: (1) The work was “of a kind usually done by petitioner,” and thus regular from the standpoint of the employee. That such is a badge of non-casual employment is obvious, the reverse being equally obvious, viz., that where one accepts work outside his established and regular calling, the idea that it is temporary and transient is spontaneously evolved. (2) The employment was for a fixed time, “two weeks or longer.” A long employment covering a period of years would seem to preclude the idea of casual, whereas an employment for an hour would seem inevitably to suggest it, so that a fixed duration is a circumstance having a bearing. In the Stillman case the court evidently regarded an employment for “two weeks or longer” as an indicium that it was non-casual. (3) The work (housework) was regular in character from the standpoint of an employer in the respect that it was work which had regularly to be done in the household from day to day, instead of being work the necessity for which only irregularly or accidentally arose. This also the court regarded as an indicium that it was non-casual.

On the whole, the court regarded the indicia that the work was non-casual as outweighing those that it was casual.

In Cantwell v. Delaney, 10 N. J. Mis. R. 783; 160 Atl. Rep. 679, the work engaged to be done was that of practical nurse and general houseworker “for a period of three weeks and such further time as her services might be desired,” the occasion for the work being the confinement of the mistress of the house in childbirth. Here there were present the indicia: (1) of an employment for a certain length of time, of at least three weeks; (2) to do work (housework) which had of necessity regularly to be done; (3) on an occasion regular in character in the sense that it is naturally to be expected, where a married couple are living together, and the time of its occurrence is long known in advance with reasonable certainty. The indicium of a casual employment suggested seems to have been that the work was in part a ministration on the occasion of a temporary illness. The court considered the indicia of a non-casual employment as prevailing.

In Forrester v. Eckerson, 107 N. J. L. 156; 151 Atl. Rep. 639, the plaintiff was a painter and was sent by defendant to his home to do “painting and some other jobs.” He had done painting and incidental work for defendant at least once before about year previously. The indicia of casual employment were: (1) that there was nothing to indicate that the employment was a regular one in the sense of continuous for a period of time, as it was to terminate with the completion of the job, or that it was to be renewed or continued at some future time, fixed or indefinite. I£ other work was ever to be done a new employment would be entered into. (2) No period of time of the employment was specified. (3) The work of painting was not regular like housework, but was desultory and occasional. On the other hand, the indicium, of non-casual character was that the employment was regular in so far as painting was concerned, as this was the plaintiff’s regular occupation. The court held the employment a casual one.

In Perroni v. Farley, 14 N. J. Mis. R. 86; 182 Atl. Rep. 353, the petitioner, a laborer by occupation, was employed by respondent to work as a laborer in miscellaneous labor assisting a contractor which respondent had employed to do certain work. No time element was contained in the contract, the respondent being at liberty to discontinue the employment at any time and the petitioner at liberty to quit. The employment only covered the particular job in question. The indicia here that the employment was a casual one were: (1) that there were no binding agreement as to a time the work should continue; (2) there was only one piece of work; (3) the work was not regular from the standpoint of the employer, the employer having engaged a contractor to do it. The indicium as to the work being non-casual was that it was regular from the standpoint of the employee, being the work he customarily did. The court held the employment casual.

In Harrington v. Garrison, 11 N. J. Mis. R. 754; 168 Atl. Rep. 166, the employee was a skilled household worker who worked for several families and had worked in respondent’s household for over ten years with the understanding that she was to be employed therein three days a week, the particular days to be selected by respondent who was to summon petitioner accordingly; compensation was fixed at fifty cents per hour.

It was contended that the employment was casual, as being "neither regular, periodic nor recurring.”

The indicia of the non-easual character of the employment present were: (1) that the employment was that regularly engaged in by petitioner; (2) being housework, it was regularly necessary from the standpoint of the employer; (3) it was regularly required three days every week; (4) it was not for a single piece of work, but continued weekly for years; (5) the “expectation of continuation" was mutual between employer and employee. The only indicium of a casual character was that the employment was not continuous in the sense of full-time employment. The court held the employment non-casual.

In Clausen v. Dinnebeil, 125 N. J. L. 223; 15 Atl. Rep. (2d) 205, the respondent owned six houses, in one of which he made his home. He supported himself .on the income from the houses. A wind storm having caused damage to the roof of the one of these houses in which respondent lived, he employed the petitioner, a carpenter, at the’ wage of $1 per hour for an eight-hour day, to aid him in repairing the damage thus caused. While the two were working together putting on a new roof the petitioner fell from the roof and was injured. Petitioner had done some repair carpenter work for respondent before as necessity arose, but he was not the only carpenter whom the respondent had used. The “occasion and actual employment arose by chance—in this ease, damage done to the roof of the respondent’s home by the storm.” The court held the respondent was not engaged in business.

The indicia of non-casual employment were: (1) the engagement by petitioner in his regular occupation, carpentry, and (2) the fact that respondent was making repairs to a house owned by him. The indicia of the casual character of the work were, (1) the wind storm as a cause of the damage; (2) the employment was for only one piece of work; (3) it was entered upon by specific present arrangement and waS not done under any past arrangement covering future work without further engagement, or as part of a recurring employment without further engagement. The court held the employment casual.

■ The case of Jasnig v. Winter, 115 N. J. L. 320; 179 Atl. Rep. 844; affirmed, 116 N. J. L. 181; 182 Atl. Rep. 842, is the one upon "which the petitioner seems most strongly to rely.

In that ease the petitioner, a seamstress, worked for a housewife. She was paid by the day at a stated daily wage witli board and with lodging when remaining overnight at the employer’s home. She worked for respondent on the 18th, 19th and 20th of February, 1932, staying overnight on those days, and returning on the 29tli, and was to remain over the night of the 29th and continue on the following day, the intervening period between the 21st and 29th containing two Sundays and a holiday. Petitioner’s injury occurred on the night of the 29 th. She was to work on different dresses on the occasion of the 29th. What the character of the work was on the 18th, 19th and 20th does not appear from the report of the case, nor does it appear whether she had worked for respondent before the 18th, but it appears that a steady and permanent employment was shown from all the evidence presented, since the court expressly found that her employment was “regular, being steady and permanent.” The indicia of the non-casual quality of the employment were: (1) the work was in petitioner’s regular line of work; (2) it was in accord with respondent’s regular occupation to have sneh work done; (3) the employment was steady; (4) it covered a number of pieces of work; and (5) extended over a substantial period of time. The indicia of casual quality were the nature of the work, viz., that of a seamstress, which ordinarily in a household is contingent on the exigencies of wear and tear, occasional and at irregular intervals. The indicia of non-casual quality were of greater weight, especially in view of the express finding of fact that the work was regular and steady.

Keturning to the definition of casual, above quoted, as expressed by our legislature and the explanation thereof by our Court of Errors and Appeals in Forrester v. Eckerson, supra, we seem to get the following result: Casual employment, when not in connection with any business of the employer, is employment not steady and permanent for more than a single piece of work, or not to be performed at some future time by the same party without further engagement.

Each case seems to stand on its own basis and must be solved in the light off: all its own particular facts and surrounding circumstances.

Applying this definition to the facts in the instant case it is obvious that the employment did not fall within the last two categories, i. e., it was not to be performed at some future time by the same party without further engagement and it was not to be performed at stated intervals without further engagement. We have left to consider whether it was regular, viz., steady and permanent for more than a single piece of work.

The indicia in the instant case of the non-casual quality of the employment appear to be as follows: (1) The work was of the character usually done by petitioner and thus regular with reference to the character of the employment; (2) the necessity for help in mending in a household is normally certain to recur as it may accumulate from time to time, and in that sense may be regarded as something regular, though the period of its recurrence would naturally be irregular; (3) the necessity for mending arose in the regular and normal course of the occupation of Mrs. Greenwood, as a housewife.

The indicia of the casual quality of the petitioner’s employment seem to be these: (1) The periods when the mending in the household would accumulate so as to require outside help were dependent upon the varying circumstances, accidents and exigencies of the persons making up the household, and were hence normally irregular; (2) the employment was not for any fixed time of substantial duration, such as, an employment for a year, a month, or a period of weeks, but was but for a single day; (3) the petitioner was not the only seamstress who worked for Mrs. Greenwood, there was no element of regularity in the sense of custom. It was a mere matter of speculation as to whether in any particular instance Mrs. Gray would be selected or one of the other seamstresses. On this particular occasion the fact that Mrs. Greenwood believed that Mrs. Gray needed the money seems to have been a factor in her favor in determining her selection; (4) both sides, Mrs. Gray as well as Mrs. Greenwood were at liberty never to renew the relation on completion of the particular batch of mending then on hand, or on the expiration of the day; (5) there was no habit, custom or understanding calling for performance of work in future by Mrs. Gray for Mrs. Greenwood.

The employment was entirely lacking in steadiness and permanency.

The indicia of the casual quality of the employment outweigh those of its non-casual, and I conclude that the petition must be dismissed.

It appears to have been assumed by both sides on the trial that there was no distinction between the status of the husband and wife in respect to liability. This may be due to the coverage of the insurance policy involved. However, it may be gathered from the entire testimony that the respondent Herbert Greenwood was a business man and that he and his wife, Prances Greenwood, maintained a homo in Maplewood over which she presided as its mistress. Under these circumstances there is no reason for a finding against the wife even if the employment had not been casual. The wife merely acted as the agent of the husband in providing necessaries for the household.

Findings may be submitted under rule nine, in accordance with this opinion.


author: Brown, C. C. J.

text:
    Hudson County Circuit Court.
    FEDERAL DEPOSIT INSURANCE CORPORATION, A CORPORATION ORGANIZED AND EXISTING UNDER AND BY VIRTUE OF AN ACT OF CONGRESS, HAVING ITS PRINCIPAL OFFICE IN WASHINGTON, IN THE DISTRICT OF COLUMBIA, PLAINTIFF, v. CORSON REALTY COMPANY, A CORPORATION OF THE ESTATE OF NEW JERSEY; ADELE K. FARR AND HENRY B. CORDTS, DEFENDANTS.
    Decided May 24, 1943.
    Por the plaintiff, George P. Moser.

    Por the defendant, James D. Connell.

   Brown, C. C. J.

The plaintiff sued the defendants in the above entitled court and a verdict of no cause of action was rendered in favor of defendants and against plaintiff and costs were thereupon taxed against the plaintiff. The plaintiff now moves to vacate the judgment for costs. While a number of cases are cited by the plaintiff in its brief to support its motion it relies particularly on the case of Federal Deposit Insurance Corp. v. Casady, Town Treasurer, et al., 106 Fed. Rep. (2d) 784, and Federal Deposit Insurance Co. v. Mangiaracina, 16 N. J. Mis. R. 203; 198 Atl. Rep. 777. The last mentioned case has little or no application to the issue presented for decision on this motion. The gist of the Mangiaracina decision was to the effect that the plaintiff is not a foreign corporation within the laws of the State of Hew Jersey requiring security for costs to be deposited, in which the plaintiff is a party, and that a state court cannot impose restriction upon the plaintiff that it does not impose upon resident corporations. The Mangiaraeina case involved the question of requiring a deposit of security for costs before trial while the motion now under consideration is whether or not the plaintiff shall be relieved of costs where it has failed in its litigation and costs have been taxed against it accordingly. Rule 54 (d) of the Federal Rules of Civil Procedure provides that “costs against the United States, its officers and agencies shall be imposed only to the extent permitted by law.” It was held by the United States Supreme Court in Reconstruction Finance Corp. v. J. G. Menihan Corp., et al., 312 U. S. 81, that the rule of procedure cited is merely declaratory and effected no change of the principles of procedure. The Federal Deposit Insurance Corporation is a corporate agency of the United States government. It has wide powers and conducts financial operations on an extended scale. It acts as a governmental agency in performing its function and most of its transactions are like those of private enterprises. The fact that it is an agency of the government does not extend to it, particularly in litigation, the immunities of a sovereign. The plaintiff was created a federal corporation through the “Banks and Banking Act” of the federal government. Its creation is particularly referred to in the United States Code Annotated, title 12, “Banks and Banking,” section 264 at page 496. Paragraph B of the section mentioned provides “The management of the corporation shall be vested in a board of directors consisting of three members, one of whom shall be the Comptroller of the Currency and two of whom shall be citizens of the United States to be appointed by the President by and with the advice and consent of the Senate.” Under title 12, section 264 and paragraph “J” at page 506, the fourth power mentioned as being granted to the plaintiff is as follows: “to sue and be sued, complain and defend, in any court of law or equity, state or federal.” Nothing appears in the federal statutes governing the transactions of the plaintiff which suggest any intention of Congress that in suing and being sued the plaintiff should not be subjected to the ordinary incidents of unsuccessful litigation in being liable for the costs which might properly be awarded against a private party in a similar case. This was the holding of the United States Supreme Court in the case of Reconstruction Finance Corporation v. J. G. Menihan Corp., supra. In that case the court further held “that it must be presumed that when Congress launched a governmental agency into the commercial world and endowed it with authority to sue and be sued’ that agency is not less amenable to judicial process than a private enterprise under like circumstances would be.” The plaintiff has availed itself of the authority granted to it to bring the defendants into court. The defendants have successfully resisted the charge made against them and they should not be denied the usual incidents of their success. The authority to sue and be sued places the plaintiff upon an equal footing with the defendants. As to all the incidents involved in the trial of the cause including the payment of costs in case of failure on the part of the plaintiff, the case of the Federal Deposit Insurance Corp. v. Casady, supra, held that in an action for insured deposits, costs should neither be awarded in favor of nor against the Federal Deposit Insurance Corporation, since it is a governmental agency. In a later case, that is, the case of Reconstruction Finance Corp. v. Menihan, supra', the court respectfully disagreed with the decision in the Casady case. The decision in the Menihan case was certified to the United States Supreme Court for final decision upon a writ of certiorari and that court sustained the decision of the lower court in disagreement with the decision in the Casady case. The United States Supreme Court decision in the Menihan case is controlling and therefore the plaintiff’s motion will be denied.


author: Waesche, President.

text:
    State Board of Tax Appeals.
    ESTATE OF THOMAS J. STEWART, PETITIONER, v. CITY OF JERSEY CITY, RESPONDENT.
    Decided May 17, 1943.
    Tor the petitioner, McCarter, English & Egner (by Conover English).

    Tor the respondent, Charles A. Rooney (by Erante P. McCarthy).

   Waesche, President.

This is an appeal from the judgment of the Hudson County Board of Taxation sustaining, in toto, an assessment of $106,700 on personalty, instituted by the Estate of Thomas J. Stewart against the City of Jersey City. The appeal seelcs the cancellation of the entire assessment.

At the hearing of the case it was conceded by the City of Jersey City that the assessment could not be sustained in a sum greater than $54,993.96 and certain questions were left open for the decision of this Board concerning the same. The questions left open, except one which is discussed later, are briefly as follows:

Petitioner claims that it is entitled to deduct as debts, under the provisions of R. S. 54:4-14; N. J. S. A. 54:4-14, an item of $528.40, being taxes for the last quarter of 1940 on real estate situate in New Jersey, on the theory that these were debts due and owing at the time of the death of the decedent and likewise on the assessing date;' a further item of $2,002.48, being taxes for the year 1941, levied on this real estate, on -the theory that these taxes became a debt of the estate on the assessing date, October 1st, 1940, the decedent having died October 6th of that year; third, the balance of rent, amounting to $1,925, on a lease which, however, was unmatured by reason of the fact that decedent was obligated on a lease on a property at 50 Glenwood Avenue, Jersey City, to pay further rent in that amount, and fourth, the principal and interest accrued up to the death of decedent, of two mortgages on a piece of New York real estate held by a New Jersey corporation, the Morco Company, amounting to a sum in excess of $180,000-.

As to the first two claims for deductions, although it is conceded that the statute permits the deduction of debts under certain circumstances, the question raised is as to whether taxes are a debt within the meaning of the section. The Board holds they are not. Our Court of Errors and Appeals has declared a property tax to be an impost, and neither a debt nor a contractual obligation. Brunner, Director of Revenue and Finance, v. Morrison et al., 123 N. J. Eq. 224; 196 Atl. Rep. 716.

As to the third item, the balance of rent accruing in futuro on an unexpired lease (not including rent due at decedent’s death or the assessing date), the Board likewise finds that this is not a debt. This finding is not altered by the fact that neither the tenant, nor his executor, under the terms of the lease, could cancel the same upon sixty days’ notice, upon the death of the wife of the tenant or the tenant, or by an option in the will by which the widow might use up the balance of the term at the expense of the estate if she so desired. Obviously, she could not have exercised this option until after the assessing date. If petitioner’s contention were correct the Board would be holding, in principle, that future rent due on any lease, whether for one or one thousand years, could be deducted as a debt by any taxpayer. Petitioner states that the purpose of R. S. 54:4-14; N. J. S. A. 54:4-14 is to avoid double taxation. Finnegan v. Jersey City, decided by this Board April 21st, 1942. Conceding this to be true, petitioner is not assessed on the value of decedent’s leasehold. Petitioner ignores the fact, in making the contention it does, that the duty to pay rent in the future is conditioned upon the quid pro quo of possession and enjoyment in the future and that the interruption of this possession by surrender, eviction, destruction of the premises and by various other facts, would dissolve this duty to pay. In other words, the future duty to pay rent is conditioned upon the receipt of a future benefit. To hold such rent to be a debt under this section of the act would be such a piece of artificial construction as to circumvent the objects of the section.

As to the fourth item, petitioner claims to be entitled to deduct the principal of two mortgages on the same property, to secure the sum of $180,000, together with accrued interest up to decedent’s death, amounting to $2,925. Decedent was on the bonds of both mortgages. It is conceded that the principal was not due at decedent’s death in either ease and when the principal did fall due in 1941 it was extended until 1946. The property, situate in the heart of New York City, was worth at decedent’s death $530,000. The fortunate circumstances of which petitioner seeks to avail itself is that the creditor happens to be a New Jersey corporation and not, as would be the usual case, a resident of New York. Hence, petitioner seeks deduction because the mortgagee is a creditor resident in New Jersey. Petitioner concedes that were the property situate in New Jersey it could not claim this deduction. This is so because at first instance the entire tax burden on the land is borne by the owner, who may claim credit on his interest if entitled to do so, for taxes paid in behalf of the mortgagee. See R. S. 54:4-15; 54:4-33; N. J. S. A. 54:4-15, 54:4-33. As a matter of common knowledge, mortgages universally provide for the assumption of all tax burdens by the mortgagor. The Board has held recently that this is the mortgagor’s sole recourse and that he cannot deduct his mortgage bonds as debts under R. S. 54:4-14; N. J. S. A. 54:4-14. Finnegan v. Jersey City, supra.

The Board sees no reason why the deduction should be allowed here. The record is barren as to the tax situation in New York, and the Board has no right to infer facts favorable to the petitioner. Neither the mortgage nor a copy thereof is in evidence. The Board does not believe that it should infer that as part of the usury for the loan of the money, the mortgagor did not agree to pay these taxes. Petitioner says that the purpose of the allowance of bona fide debts under section 54:4-14 is to prevent double taxation. This is so with certain exceptions, two of which are that such deduction is limited to intangibles; see R. S. 54:4-15; N. J. S. A. 54:4-15, and further that the deduction is limited to-the debts due resident creditors. The object of the statute is to tax net equity, determined after deduction of debts from gross assets. See Finnegan v. Jersey City, supra. How will the treating of a security of $530,000 as if it did not exist, and thus permitting the offset of a debt of $180,000 against what remains of the assets of the estate, effect the purpose sought to be accomplished by the statute? The answer is obvious. The Board finds that the fortunate coincidence that the creditor is domestic can thus be employed to create a most unjust result.

These deductions as a credit cannot be allowed for one further reason, and that is that under R. S. 54:4-14; N. J. S. A. 54:4-14 in order that the assessor may be compelled to make deduction for debts the claim must b.e filed in the form therein prescribed. It must be under oath and it must state, among other things:

“No part of the debt so incurred for the purpose of reducing the taxes of the claimant and that the stated value of the personal property of the claimant includes not only that to which he holds title or possession, but also that to which any other person holds title or possession for claimant, whether in trust or not.”

Exact compliance with all requirements of the section is essential, and substantial compliance is not sufficient. Household Finance Co. v. State Board of Tax Appeals (Supreme Court, 1937), 119 N. J. L. 230; 196 Atl. Rep. 219; Household Finance Co. v. State Board of Tax Appeals (Supreme Court, 1941), 126 N. J. L. 399; 19 Atl. Rep. (2d) 816. The claim for deduction is not filed in the manner prescribed by statute because it fails to contain the statement hereinbefore quoted.

The last question left open for the decision of the Board is whether or not there should be deducted from the foregoing amount the sum of $14,442.26, being the value of the stocks of foreign corporations held by the decedent. This .is claimed under that section of the law, R. S. 54:4-3.2; N. J. S. A. 54:4-3.2, which exempts the personal property of taxpayers situate out of the state, upon which taxes shall have been actually assessed and paid within twelve months next before the assessing date of October 1st. The petitioner was unable to prove the payment of these taxes by the corporations in question, but urges that this Board should presume that the taxes are paid because of the fact that there is a presumption, in view of the regularity and honesty of the action of others, and that the corporations in question are companies of repute, which ordinarily pay their taxes. This theory is not tenable for two reasons. First, one claiming exemption from genera] taxation must adduce facts bringing his case within the statute granting exemption. Princeton Country Day School v. State Board of Tax Appeals, 113 N. J. L. 515; 175 Atl. Rep. 136. Secondly, there is presumption that a tax assessment made by the proper authority is correct. New Jersey Bell Telephone Co. v. Newark, 118 N. J. L. 490; 193 Atl. Rep. 844.

The additional claims for deductions are denied, and the assessment, in accordance with the agreement of the parties, is herewith reduced to $54,993.96.

Judgment accordingly.


author: Maesche, President.

text:
    State Board or Tax Appeals.
    JOSEPH MELTZER, INC., OF NEW JERSEY, PETITIONER, v. CITY OF JERSEY CITY, RESPONDENT.
    Decided June 1, 1943.
    For the petitioner, Hollander, Leichter & Klotz (by Manuel Meth and Bernard A. Schwarz.)

    For the respondent, Charles A. Rooney (by Theodore C. Baer).
   Maesche, President.

This is an appeal by Joseph Meltzer, Inc., a domestic corporation having its chief office in Jersey City, from an assessment by that municipality for the year 1939 in the sum of $100,000 on personalty, which was affirmed by the Hudson County Board of Taxation. Petitioner here seeks a reduction of the assessment to the sum of $316.34.

Petitioner had been engaged in the general contracting business since 1932 and at one time was quite active, but on the assessing date and since that time the corporate enterprise appears to have been practically dormant. The admitted assets of petitioner on the assessing date consisted of cash in bank of $66.34 and notes receivable of $250, totaling in all $316.34.

The city appears to have based the bulk of its assessment upon the following facts: The corporation, during the years of 1934 and 1935, had a contract with the United States Government for the construction of a project known as Lock ISTo. 21, at Quincy, Illinois. This contract appears to have been fully performed and the full contract price was paid by the government for that performance prior to the assessing date. The company, however, made claim against the United States for $350,000 or more. This claim was based upon (1) the failure of the United States to supply it with qualified labor; (2) the forcing of petitioner, by the United States, to produce concrete in such a manner that the cost was much greater than under normal conditions; (3) the fact that the subsoil conditions within the cofferdam were different from the conditions indicated by the plans furnished by the United States. It would thus appear that the company’s various claims against the United States Government were unliquidated by their very nature and that they did not partake of the characteristics of what in legal parlance is called a “debt,” whore the amount has been definitely liquidated and settled. Upon denial of liability by the United States the company filed suit, in the year 1937, in the Court of Claims, where it is still pending and undetermined, the United States contesting the company’s claims. The principal question raised in the present proceeding is whether or not this claim is taxable property within the meaning of the act.

In addition to the character of the suit heretofore described, it must be remembered that a claim against the United States Government is somewhat different from an ordinary claim, due to the elementary principle that a sovereign cannot be sued without its consent. To avoid the hardship of this fundamental rule of law, Congress set up the Court of Claims, which has jurisdiction to try and determine certain types of claims against the government. The jurisdiction of the court is set out in section 145 of the Judicial Code of the United States (U. S. C. A., title 28, ch. 7, § 250). Here the right to sue is not an absolute right even where jurisdiction is established and this is attested by the fact that claimant must at all times have borne true faith and allegiance to the government (sections 159, 160 and 161, Judicial Code) and that any assignee of the claim takes subject not only to this defense, but to the further defense that prior assignees have exhibited disloyalty to the government, as well as the claimant, so that a perfectly meritorious claim could be defeated on this ground alone. Certain types of fraud in connection with, the claim will vitiate it likewise (section 172 of the Judicial Code). In other words, there seems to be no absolute right to recover and there are obstacles to a free assignment of such claim.

Our General Tax Act (in conformity with the constitutional injunction laid down in article 4, section 7, paragraph 12 thereof) states that all property, real and personal, not expressly exempt from taxation or excluded from taxation by provisions of the statute, shall be assessed by the assessors of the respective taxing districts. N. J. S. A. 54:4-1. Corporate property shall be assessed in the same manner generally as the property of an individual. N. J. S. A. 52:4-2. The statute, however, does not specifically define what “property” is or what “personal property” is. It does, however, go on to say that the assessor shall ascertain annually, by diligent inquiry, the amount of personal property owned by each taxpayer in his district and states the manner thereof in the following language:

“Every inhabitant of a taxing district and every owner of personal property located in the district shall, on application of the assessor, forthwith render a true account of his name and his personal property, moneys, effects and credits and the assessor shall set down in a list in proper columns the names, the value of the personal estate assessed to each one, including the amount of collectible debts due to him * * N. J. 8. A. 54:4-12.

It would appear, therefore, that while property is not specifically defined, that portion of the statute which governs the method of assessment and the manner in which an assessor shall make his assessment clearly indicates the legislative intent as to what was to be considered property for the purpose of assessment and taxation. The intent of paragraph 12 therefore would seem to be to tax “collectible debts.” This would indicate that unliquidated claims, the appraisal of whose value would be sheer guess work because they are intangible expectancies, are not to be considered as property within the meaning of the act. The respondent city leans very heavily upon the legal presumption that an assessment once made by the assessors is presumed to be correct and that the burden of proof is upon the petitioner to prove otherwise. New Jersey Bell Telephone Co. v. City of Newark (Supreme Court, 1937), 118 N. J. L. 490; 193 Atl. Rep. 844; affirmed, 124 N. J. L. 451; 12 Atl. Rep. (2d) 675. While agreeing with the general holding of this case, the Board here points out that in order that the principle of this case may be applicable, the assessment must be made in connection with what the legislature deemed to be property and that the mere citation of this ease begs the question here involved. Where the value of a claim is so indefinite that even counsel for the petitioner in the Court of Claims, or counsel for the government in this court could not give an accurate statement as to its value, the guess of a local assessor is no more sacrosanct than that of anyone else. Concluding, therefore, that the claim is unliquidated by its very nature and that the statute was not intended by the legislature to apply to such unliquidated claims, the Board must disregard tins claim as an item to be considered in assessing the personalty of the petitioner.

During the cross-examination of Mr. Meltzer, who apparently was the principal owner and directed the activities of the petitioner, counsel for the respondent, basing his questions upon the income tax return of petitioner for the year 1938, examined the witness upon several items, to which the answers were most unsatisfactory. On that income tax return it was stated that the corporation had outstanding notes receivable in the amount of $2,250, loans receivable in the amount of $19,522.24 and that it owned $5,000 of the capital stock of the Gleam Products Corporation. The memory of the witness was very vague about these items. He did not and would not definitely state that these were not assets of the corporation on the assessing date. Ho books of the corporation were produced, although they could have been. The names of the debtors could not even be brought to mind by the witness, nor was the testimony of Mr. "Roth, the corporation accountant, any more satisfactory in this respect. It seems to the Board that there was a duty on the petitioner to come forward and state its assets fairly and frankly and to produce its books and all other information necessary to a clear and accurate statement of its assets on the assessing date. This is,especially true since all of the relevant information was within its control and the burden of proof was definitely on it to overcome the presumption of correctness which the assessment carries. New Jersey Bell Telephone Co. v. City of Newark, supra.

Accordingly, to the admitted assets of the petitioner on the assessing date should be added these assets, amounting to $26,834.46, making a total in all of $27,150.80, and the assessment should be reduced to this amount.

Judgment accordingly.


author: Kinkead, C. C. J. E.

text:
    Monmouth County Circuit Court.
    IN THE MATTER OF THE CONTEST OF THE ALLEGED ELECTION OF JOSEPH L. DONAHAY, TO THE OFFICE OF SURROGATE OF MONMOUTH COUNTY, STATE OF NEW JERSEY.
    Decided June 11, 1943.
    For the petitioner, J. Victor Carton, John M. Pillsbury and Charles Frankel.

    For the incumbent, Ward Kremer and Joseph F. Mattice.

   Kinkead, C. C. J. E.

Donald Sterner (hereinafter referred to as the contestant), has filed a petition in the Monmouth Circuit Court, contesting the alleged election of Joseph L. Donahay (hereinafter referred to as the incumbent), to the office of surrogate of Monmouth County, New Jersey, in accordance with the provisions of R. S. 19 :29-2, et seq.; N. J. S. A. 19 :29-2, et seq.

The petition alleged that, at the general election held in Monmouth County on November 3d, 1942, the incumbent was declared elected as surrogate by a margin of 84 votes; that, as a result of a recount held in 80 of the 153 election districts in Monmouth County, the plurality of the incumbent was reduced to a total of 14 votes; that, as a result of the malconduct, fraud or corruption on the part of the members of the district board of the third district in the third ward of the City of Long Branch, no election was held in said district, in accordance with the provisions and within the intent of the Election Law, and that there should be eliminated and rejected in the result of the aforesaid election, the entire vote cast for the office of surrogate of Monmouth County in said district; that the Circuit Court should pronounce judgment setting aside the vote cast in said district, (thereby nullifying a plurality of 174 votes in that district in favor of the incumbent); that the certificate of election heretofore issued to and received by the incumbent should be canceled, set aside, and annulled by the court; and that the court should pronounce judgment that the contestant was duly elected to the office of surrogate of Monmouth County, and entitled to receive a certificate of election to the said office.

The incumbent filed an answer denying the allegations of fraud set forth in the petition, and also filed a counter-claim. The counter-claim alleged that there was gross malconduct, fraud and corruption upon the part of the members of the district boards in the first, second, third and fourth election districts of the Borough of Belmar; that the court should set aside the votes cast in said districts (thereby nullifying a plurality of over 500 votes in favor of the contestant in said districts); that the Monmouth County Board of Elections made an error in counting, canvassing and declaring the vote of men in the armed forces of the United States at said election, and that the said County Board of Canvassers did not determine, prior to counting and canvassing the said vote, whether the members of the armed forces were registered or not, as required by law; and that the court should declare that the incumbent had been duly elected to the office of surrogate of Monmouth County on November 3d, 1942.

The contestant moves to strike out the answer and counterclaim on two grounds: (1) that the answer and counterclaim are without legal merit; (2) that the answer and counter-claim are improper, and that there is no statutory authority for same.

When the matter was argued orally before the court, the contestant conceded that the answer of the incumbent was proper, in so far as it constituted merely an answering plea to the allegations of the petition. The argument, therefore, was confined solely to the legality of the counter-claim.

At the outset, it must be kept in mind that the contestant did not recount the votes in the entire 153 election districts in the county. Eather, he chose but 80 of those districts for a retally, and the presumption naturally is, that he chose the districts where a recount would be most likely to result favorably to him.

In any event, when, at the conclusion of the recheck of 80 districts, the contestant was still 14 votes behind, the incumbent was precluded from ascertaining what a recount of the remaining 73 election districts in Monmouth County would demonstrate. Under the provisions of R. S. 19 :28-4; N. J. S. A. 19:28-4, the incumbent can only proceed to recount any remaining districts wherein he was a candidate, if the contestant has gained the lead as the result of a partial recount.

Thus, if the motion to strike the counter-claim were to prevail, the incumbent would be powerless, either in these proceedings, or in the recount proceedings, to prove that he had been elected surrogate by the electorate of Monmouth County. Under those circumstances, it would be possible for a contestant, by clever maneuvering, to gain an unfair advantage over an incumbent, and to practically frustrate an incumbent from demonstrating in a Circuit Court proceeding, what the will of the voters in a certain election had been.

In the instant case, the contestant has chosen a district wherein he alleges .that fraud was committed. The law gives him the right to have the entire vote of that district rejected, if he can prove to the satisfaction of the court, that fraud has been perpetrated in said election district by the officers of election, or permitted by them, to such an extent and character, that the correct and genuine result cannot be determined with reasonable certainty. Burkett v. Francesconi 127 N. J. L. 541; 23 Atl. Rep. (2d) 780.

If the evidence submitted by the contestant should impel the court to reject the entire vote cast for the office of surrogate in the third district of the third ward of Long Branch, it would seem unconscionable to bar the incumbent from submitting evidence to sustain the incumbent’s allegations of fraud in the first, second, third and fourth districts of Belmar.

, To sustain such a contention, the court would have to conclude that the legislature intended to give a contestant in an election contest a distinct advantage over an incumbent. Common sense, however, points rather to the inevitable conclusion, that the legislature was endeavoring to provide, by this legislation, the means by which a contestant or an incumbent, who had been honestly elected to an office by the votes of his fellow citizens, could prove his right and title to that office, and have the Circuit Court pronounce judgment in his favor.

The contestant contends that this proceeding is purely a statutory one. The court agrees that it is quite clear that the decisions of our state so hold. Clee v. Moore, 119 N. J. L. 215; 195 Atl. Rep. 530; Burkett v. Francesconi, supra. But the court cannot agree with contestant’s contention, that there is no statutory provision which would entitle the incumbent to demonstrate that fraud had been committed against him, in certain election districts, and that the court must confine itself, exclusively, to the allegations of fraud set forth by the contestant.

R. S. 19:29-5; N. J. S. A. 19:29-5, provides: “The proceedings shall be similar to those in an action at law so far as practicable, but shall be under the control and direction of the court, which shall hear and determine the matter without a jury, with power to order any amendments in the petition, or proceedings as to form or substance, and to allow adjournments to any time not more than thirty days thereafter for the benefit of either party, on such terms as shall seem reasonable to the court, the grounds for such adjourn-• ment being shown by affidavit.”

• Certainly, if the proceedings are to be similar to those in an action at law, the incumbent’s counter-claim must be sustained, for a counter-claim is a common and perfectly proper pleading in an action at law.

A further perusal of R. S. 19 :29-5; N. J. S. A. 19 :29-5, and also R. S. 19:29-6; N. J. S. A. 19:29-6, which is as follows: “The court may compel the attendance of any officer of such election and of any other person capable of testifying concerning the same, and also compel the production of all ballot boxes, books, papers, tally lists, ballots and other documents which may be required at such hearing. The style, form and manner of service and process and papers, and the fees of officers and witnesses, shall be the same as in the circuit court in other cases, as far as the nature of the ease admits,” leads the court to conclude that, by these statutes, the legislature had intended to, and did, empower the Circuit Court in an election contest, to ascertain the merits and the justice of a dispute between a contestant and an incumbent. By these statutes, it is quite obvious that the legislature did exactly what the citizens of ITew Jersey would propose that it should do, namely, to give to each party, in an election contest, his day in court, to the end that the Circuit Court might determine what the will of an electorate in an election had been, and to pronounce judgment accordingly.

The motion of the contestant is denied.


text:
    Hudson County Circuit Court.
    APPLICATION FOR THE AWARDING OF THE PROCESS OF SUBPOENA PURSUANT TO N. J. S. A. 54:4-34.
    For the City of Jersey City, Charles A. Rooney.

    For the Delaware, Lackawanna and Western Bailroad Company, John A. Laird.

   Brown, C. C. J.

In the month of April, 1943, the tax assessor of the City of Jersey City issued an order in writing, directing the Delaware, Lackawanna and Western Bailroad Company, a corporation authorized to transact business in the State of Hew Jersey, and Walter W. Eastburn, land and tax agent of said company, to appear before the assessor at the city hall in, Jersey City and testify in regard to, and produce, such lease or leases or operating' agreements which the railroad company now has, or did have on October 1st, 1941, and October 1st, 1942, with any person or corporation with regard to the “Lackawanna Freight Terminal Building” located in Jersey City. The order was admittedly duly served. It is agreed there are no leases on record relating to said building." .The building is now assessed by the State Tax Cbmmissioner as second class railroad property and has been so assessed and classified for a number of years. The tax assessor of Jersey City demands the production of the leases and the sworn testimony of the agents of the railroad company to discover whether the provisions of the terms of the leases or agreements are such as to justify reclassification of said property so as to include it in the ratables of Jersey City instead of being classified as second class railroad property. The railroad company and its agents have refused to obey the order of the tax assessor of Jersey City. The application before the court is for the award of process of subpoena to compel the parties to appear and testify and produce the papers required before the tax assessor. The applicant for the order contends that the statutory authority for this court to make such an order may be found in B. S. 54:4-34. The railroad company and its agent do not dispute the service of the order made upon them by the assessor of Jersey City. The matter in difference between the parties is whether this court has the power to award process for subpoena for appearance to testify and production of records and punish for contempt any person disregarding such process. The city contends that this court has the power and the railroad company and its agents deny there is such power in the law. The statutory provisions involved are B. 8. 54:4-16; N. J. 8. A. 54:4-16, which relates to personal property and provides:

“The assessor shall have power to examine under oath any person or officer of a corporation with regard to the taxable property of himself, the corporation or others, or the truth of the matters contained in the claim for deduction or exemption of any person or corporation, and may compel the attendance of such persons and other witnesses and the production of books and papers by his order therefor, designating the time and place for such attendance and production. The order shall be served on the person, witness or corporation at least two days before the time named, either personally or by leaving it at the residence of the person or witness or at the office of the corporation. In ease of failure to comply with the order, the assessor may apply to the circuit court or the court of common pleas which shall award process of subpcena foT such appearance and production, and may punish for contempt any person disregarding such process.”

And R. S. 54:4-34; N. J. S. A. 54:4-34, which relates to real property and which provides:

“Every owner of real property of the taxing district shall, on application of the assessor, render a full and true account of his name and real property and produce his title papers, and he may be examined on oath by the assessor, in substantially the same form as is provided in article 4 of this chapter (54:4-9 et seq.) in the ease of personal property, and if the shall refuse so to do, or to testify on oath when required, or shall render a false or fraudulent account, the assessor shall estimate his property at the highest value he has reason to suppose it may be placed.”

It is a further contention of the applicant that the two sections of the statute above cited should be read together and that as a consequence the powers and duties of the assessor under section 54:4-16, relating to personal property, are conferred on the assessor by the express language of section 54:4-34 relating to real property. As the question presented for determination arises primarily out of the construction to be placed upon the sections of the Tax Act above cited it is well to review briefly the tax laws of the state concerning the power of the assessor to examine persons in relation to their real and personal property for the purposes of taxation. In the revision, Pamph. L. 1903, p. 399, § 8, it was provided that on application of an assessor every inhabitant of the taxing district shall render a full and true account of his name, ratable real property and produce his title papers and may be examined on oath by the assessor and if he shall refuse to do so, or testify on oath when required, or shall render a false and fraudulent account, the assessor shall estimate Ms property at the highest value he has reason to suppose it may be placed. It was also provided in Pamph. L. 1903, § 14 (at p. 402), in regard to the assessment of personal property that the assessor had the power to examine and to compel the attendance of such persons as witnesses; require the production of books and papers by his order and in case of failure to comply with such order the assessor was empowered to apply to the Circuit or County Court which shall award process of subpoena for such appearance and production. The general revision of Pamph. L. 1903 provides for an examination and production of papers and is substantially the same form as the present Tax Act, with the exception that R. S. 54:4-34; N. J. S. A. 54:4-34, relating to real estate provides that the owner may be examined on oath by the assessor “in substantially the same form as is provided in article 4 of the chapter (54:4-9, et seq.). Following the enactment of Pamph. L. 1903 there was enacted the tax law of 1918 which is the source of the law which controls the issues involved on this application. R. S. 54:4-16; N. J. S. A. 54:4-16, relating to personal property was enacted the same as section 304, Pamph. L. 1918, p. 855, and section 403 relating to real property, Pamph. L. 1918, p. 862, is the same as R. S. 54:4-34; N. J. S. A. 54:4-34. It is an established rule of construction regarding tax laws that a liberal construction must be given to all tax laws for public purposes not only that the officers of government may not be hindered, but also that the rights of all taxpayers may be equally preserved; State v. Taylor, Collector of Paterson, 35 N. J. L. 184. It should be borne in mind also a “Tax” is a legal imposition, exclusively of statutory origin; Bente v. Bugbee, 103 Id. 608; 137 Atl. Rep. 554, and so are the remedies attendant thereto. The legislature without ambiguity and with clearly expressed intention by R. S. 54:4-16; N. J. S. A. 54:4-16, empowered the assessor to examine any person or officer of the corporation relating to the taxable personal property of himself or the corporation and to compel the attendance of such person and their witnesses and the production of books and papers and it is clearly expressed in this section of the tax law that “in case of failure to comply with the order, the assessor may apply to the Circuit Court or the Court of Common Pleas which shall award process of subpoena for such appearance and production, and may punish for contempt any person disregarding such process.” The enactment of R. S. 54:4-34 requires every owner of real property on application of the assessor to render a true account of his name and real property and produce his title papers and that he be examined under oath by the assessor in substantially the same form as provided in R. S. 54:4-16 in the ease of personal property, and the legislature expressed its intention without ambiguity concerning a witness who refused to testify or produce books and papers that the assessor “shall estimate his property at the highest value he has reason to suppose it may be placed.” It will bo thus seen that the reference in R. S. 54:4-34 to R. S. 54:4-16 relates to the form of the examination eoncerning real property to be tbe same as the examination by the assessor concerning personal property. In case of failure, however, the penalties in both sections are expressly different. Under R. S. 54:4-16; N. J. S. A. 54:4-16, upon failure an application may be made to the Circuit Court of County Court for process to issue. Under R. S. 54:4-34; N. J. S. A. 54:4-16, the remedy is to assess the property at the highest value the assessor has reason to suppose it may be placed. It is this latter statutory remedy that is open to the applicant. The petition will be denied.