author: Woebee, 0. C. J.

text:
    MEYER W. STEIN, PLAINTIFF, v. WILLIAM SCHMITZ, LEWIS S. JACOBSON AND EUGENE V. REGALIA, DEFENDANTS.
    Decided March 19, 1943.

      For the plaintiff, Harry G-reen.

    For the defendant William Schmitz, Lewis S. Jacobson.

   Woebee, 0. C. J.

This matter comes before me on a motion to strike the complaint on the grounds that:

1. It is sham;
2. It is frivolous (sic) ;
3. It does not set out a cause of action;
4. It is against public policy.

At the same time there was a counter-motion on behalf of the plaintiff to expunge from the record the affidavit of William Schmitz on the ground that it violated the rules of the court in that it makes statements based on hearsay, states conclusions and characterizations, and fails to set forth facts in support of the motion, and further, that the notice of motion should be stricken on the ground that it does not contain a particular statement of any defects in or objections to the complaint herein.

I shall consider the motion on behalf of the defendant Schmitz to strike the complaint on the ground urged, that it is insufficient in law.

The' complaint filed herein sets forth that Schmitz and two others did “conspire, act in concert, and maliciously conceive a scheme to cause plaintiff to be disbarred, to ruin plaintiff and drive him from the practice of law, and to injure plaintiff’s reputation and standing in his profession.”

Paragraph 6 of the complaint uses the following language: “In pursuance of such scheme and conspiracy the said defendants willfully and maliciously and without justifiable cause, contriving and intending to cause plaintiff to be disbarred, to ruin him and drive him from the practice of law and to injure his reputation and standing in his profession as aforesaid, did on or about December 11th, 1940, file or cause to be filed a false and fraudulent complaint against the plaintiff in the Supreme Court of Hew Jersey, charging the plaintiff with unprofessional, unethical and criminal conduct, inelud'ing among other things charges that plaintiff attempted to unlawfully extort moneys from the defendant Schmitz, that he threatened Schmitz with scandal and bad publicity predicated upon charges of adultery against said defendant made in a certain counter-claim filed by plaintiff, and that this plaintiff knew at the time he filed said counter-claim that said charges of adultery were untrue.” Plaintiff further alleges.in said paragraph that the said complaint was prepared by and under the direction of said defendants or some of them and was signed and sworn to by the defendant Schmitz.

Plaintiff further alleges that the Supreme Court referred the matter to the Board of Bar Examiners of the State of Hew Jersey for a hearing, and that hearings were had before the State Board on July 1st, 11th, 25th, August 1st, 7th and 13th, 1941, and that the defendants herein appeared and testified at said hearings.

The complaint then alleges that the charges made by defendants against the plaintiff were utterly false and unfounded and there was no reasonable ground for making said charges and says that the Board of Bar Examiners subsequently filed a report that plaintiff was not guilty of the charges against him alleged in the complaint of the defendants.

In the tenth paragraph of the complaint it is alleged that at the time defendants filed the verified complaint in the Supreme Court, they knew that the charges made therein against the plaintiff were false and they filed the complaint willfully and maliciously and without justifiable cause and for the purpose of ruining the plaintiff in his profession and having him disbarred.

Plaintiff further alleges that at the time of the filing of said complaint, defendants had no reasonable ground to believe that the charges were true and they filed the same carelessly, wantonly and recklessly, in disregard of the rights of the plaintiff.

In the thirteenth paragraph of the complaint it is alleged that as a part of the conspiracy to injure the plaintiff defendants formed a scheme to entrap him and to create and establish circumstances and documents which might be misinterpreted to throw suspicion upon plaintiff and which would mislead the court, so as to aid defendants in accomplishing their purposes, and at the hearings the defendants caused and permitted to be placed in evidence exhibits acquired by them as a result of said scheme of entrapment, and falsely and maliciously persisted in said charges and testified so as to make the court and said Board of Bar Examiners believe that plaintiff was guilty of said charges against him.

In the ad damnum clause of the complaint plaintiff avers that by reason of the conduct of defendants he was placed in jeopardy of being disbarred from his profession and of being prosecuted criminally; he was injured in his reputation in his profession; greatly injured in his feelings and suffered groat anguish and pain of mind and body; was prevented from attending to his lawful affairs and his law practice and suffered irreparable injury; he was obliged to expend a great amount of time, labor and money in defending himself against these unfounded charges and was and has been subjected to the contempt of his friends, other lawyers, acquaintances and the public.

The complaint demands both compensatory and punitive damages against the defendants.

The complaint here does not set forth a cause of action for defamation, nor malicious prosecution, nor malicious abuse of process, nor a cause of action involving malicious interference with the performance of a contract. It is rather an action on the case setting forth a malicious conspiracy or confederation, with the means employed to effect its purpose and resulting damages to the plaintiff. It is a cause of action belonging to the class in which malice, in the sense of actual ill will, is a necessary element. The conspiracy is not the gravamen of the charge, but may be pleaded as aggravating the wrong of which the plaintiff complains, enabling him to recover against the three defendants as joint tort-feasors. If he fails in the proof of a conspiracy or concerted design, he may still recover damages against such as are shown to be guilty of the tort without such agreement. Daly v. Singac Auto Supply Co., 103 N. J. L. 416; 135 Atl. Rep. 868 (1926, Black, J.).

We have in this complaint a cause of action similar to that set forth in Van Horn v. Van Horn, 52 N. J. L. 284; 20 Atl. Rep. 485 (Supreme Court, 1890, Scudder, J.). The difference between this type of action and slander is well stated in Riding v. Smith, 1 L. R., Exch. Div. 91, where a slander against the wife was charged as having injured the husband’s business. Her name was stricken from the record as a joint plaintiff and the action was allowed to proceed by the husband as a trader carrying on business, founded on an act done by the defendant which led to loss of trade and custom by the plaintiff. It was maintainable on the ground that the injury to the plaintiff’s business was the natural consequence of the words spoken, which would prevent persons from resorting to plaintiff’s shop.

The basis of the action in the Yan Horn case, as stated in the declaration, was the fraudulent and malicious acts of the defendant in driving the plaintiff out of her business.

In a similar case between the same parties ih 53 N. J. L. 514; 21 Atl. Rep. 1069, (Supreme Court, 1891, Garrison, J.), there was a demurrer to defendants’ plea that the cause of action did not accrue within two years next before the commencement of the suit. The defendants pleaded the statute of limitations applicable solely to words spoken, so that the single question presented by the demurrer was whether the action was for words spoken; i. e., whether the declaration was for slander. As the Supreme Court had held that the action was one on the case for malicious injury to the plaintiff in her business, and not an action for words, the interposition of the plea of special limitation, appropriate only to actions for slander, could not apply.

The Van Horn case was finally tried before the Essex Circuit Court and the jury was instructed that if the acts done by the defendant were prompted by malice and ill will, with the purpose of injuring and obstructing the business of the plaintiff and such acts produced the injury complained of, the plaintiffs were entitled to recover. There was a verdict against the defendant Amos Van Horn and he insisted in the Court of Errors and Appeals, 56 N. J. L. 318; 28 Atl. Rep. 669 (1893, Van Syckel, J.) :

1. That the facts set forth in the declaration would not sustain the action against him alone;

2. That the communication made by him to one Snyder was privileged;

3. That the action was barred by the two years’ limitation.

The court held that while a trader may lawfully engage in the sharpest competition with those in a like business by holding out extraordinary inducements, by representing his own wares to be better and cheaper than those of others, yet when he oversteps that line a,nd commits an act with the malicious intent of .inflicting injury upon his rival’s business, his conduct is illegal, and if damage results from it the injured party is entitled to redress. It does not matter whether the wrongdoer effects his object by persuasion or by false representation. The courts look through the instrumentality or means used to the wrong perpetrated with the malicious intent, and base the right of action upon that. The principle is that the action is founded on the tort, and can therefore be sustained against one as well as against several for the damage chargeable to the wrongful act. The charge of conspiracy as an actionable element is disregarded and the malicious injury and resulting damage are considered as the foundation and support of the action. The rule is firmly established in the cases that in an action charging conspiracy, a verdict may be rendered against one alone upon proof that he intentionally inflicted the injury through persuasion or by false representations, instigated by malice.

The court held that as the action was not one for slander, the two-year limitation would not be a bar.

As to the question of privilege, the trial court charged the jury that a man has a right to inquire of his neighbor into the circumstances of a person to whom he is giving credit, and that person may on such occasions communicate freely, and unless his communication be of facts which he does not honestly believe or the communication be such as was made not for the honest purpose of conveying the information to the inquirer, but such as in the judgment of the jury, under the evidence, shows that the defendant took advantage of that privilege to gratify a malicious purpose, no action will lie. As there was evidence of malice, the trial judge properly submitted the question of malice to the jury. This rule was adopted in Andrew v. Deshler, 45 N. J. L. 167 (1883, Green, J.).

Mr. Justice Minturn in the case of La Porta v. Leonard, 88 N. J. L. 663; 97 Atl. Rep. 251 (1915), which was a suit by a member of the bar for slander, held that the claim of privilege obtains recognition as an exception to a general rule of liability for tort-feasance, only from the highest considerations of necessity and public policy (1 Street Leg. Lidb. 307) and adopted the American rule as distinguished from the English rule of absolute and unqualified privilege laid down in Munster v. Lamb, 11 Q. B. D. 588, that the privilege of lawyers, witnesses and parties is conditional upon the pertinence of the matter to the question on hand and its materiality, citing 1 Street Leg. Hob. 308 and cases cited; also 25 Cyc. 377 and eases cited.

In Louis Kamm, Inc., v. Flink, 113 N. J. L. 582; 175 Atl. Rep. 62 (1934), Mr. Justice Heher held that the right to pursue a lawful business is a property right that the law protects against unjustifiable interference, and that any act or omission which unjustifiably disturbs or impedes the enjoyment of such right constitutes its wrongful invasion and is properly treated as tortious. He cited the Van Horn case reported in 56 N. J. L. 318; 28 Atl. Rep. 669, and said that while ill will toward a person is malice in its common acceptation or popular sense, in the technical, legal sense it is the intentional doing of a wrongful act without justification or excuse, citing Brennan v. United Hatters, 73 N. J. L. 729; 65 Atl. Rep. 165 (1906, Pitney, J.). A wrongful act is any act which in the ordinary course will infringe upon the rights of another to his damage, except it be done in the exercise of an equal or superior right. An intent is wrongful if malicious, and malice may be inferred from the absence of just cause or excuse.

In Malone v. B. of L. F. & E., 94 N. J. L. 347; 110 Atl. Rep. 696 (Supreme Court, 1920, Parker, J.), we find an action for malicious conspiracy and malicious conduct causing the discharge of the plaintiff from employment. Its gist is the same as that of Brennan v. United Hatters, supra. It was held that where the gist of the action is malice, general allegations of conspiracy, persuasion, threat, &c., are good pleading. See, also, Minsky v. Satenstein, 6 N. J. Mis. R. 978; 143 Atl. Rep. 512 (Supreme Court, 1928, Ackerson, S. C. C.).

In the case of Saum v. Proudfit, 122 N. J. L. 96; 4 Atl. Rep. (2d) 35 (Supreme Court, 1939, Perskie, J.), three causes of action were set up, namely: malicious prosecution, libel and malicious abuse of process. These alleged wrongs arose out of a complaint which defendant made to the Hew Jersey Eeal Estate Commission concerning plaintiff’s allegedly improper refusal to return to defendant a down payment of $10 made to plaintiff. Defendant filed a duly verified complaint with the commission, charging that plaintiff was guilty of withholding moneys rightfully belonging to defendant, contrary to section 13, chapter 141 Pamph. L. 1921; R. S. 45:15-17; N. J. S. A. 45:15-17. The cause was set down for hearing by the commission. All parties appeared. The cause was not reached by noon of the day set, when defendant left because he said that he was obliged to serve a milk route and could get no one to take his place. Thereafter the complaint was dismissed because of the “nonappearance” of defendant. Hence this suit and resulting judgment which defendant challenges. This case was submitted by the trial judge to the jury upon the theory that it was a suit solely for malicious prosecution in which the plaintiff sought to recover the damages which he allegedly suffered as a result of the proceedings which defendant had instituted against him before the real estate commission wrongfully and without reasonable and probable cause. The theory of the suit, so adopted and pursued, was binding upon the parties. Neither the count charging malicious prosecution nor the proceedings before the commission disclosed that plaintiff had been arrested or that he or his goods or other property had been attached or that he suffered some special grievance different from and superadded to the ordinary expense of a defense. Because of these undisputed circumstances, the count for malicious prosecution for the wrongful initiation of the civil proceeding before the commission did not lie. The only penalty defendant there and complainant before the commission incurred in the premises was an adverse bill of costs. Potts v. Imlay, 4 N. J. L. *331 and *334 (Supreme Court, 1816, Kirkpatrick, C. J.); Bitz v. Meyer, 40 Id. 252, 254 (Supreme Court, 1878, Yan Syckel, J.); Hammill v. Mack International Motor Truck Corp., 104 Id. 551; 141 Atl. Rep. 775 (1928, Parker, J.).

Cases like Dwyer v. Anderson, 113 N. J. Eq. 210; 166 Atl. Rep. 293 (Court of Chancery, 1933, Stein, V. C.); Raimondi v. Bianchi, 100 N. J. Eq. 238; 134 Atl. Rep. 866 (Court of Chancery, 1926, Berry, V. C.), and Daly v. Watson, 190 Atl. Rep. 320 (Court of Chancery, 1936, Egan, V. C.), are all eases in 'which the transactions of an attorney with his client were carefully scrutinized in the Court of Chancery on initiation of the client, and are not applicable here.

Cases like Cooper v. O'Connor, 69 App. D. C. 100; 99 Fed. Rep. (2d) 135, involving a banker accused by department agents of violating the banking laws; Fletcher v. Wheat, 69 App. D. C. 259; 100 Fed. Rep. (2d) 432, involving judges and other public officials who were charged with conspiracy to disbar; Cook v. Dodge, 164 Misc. 78; 299 N. Y. S. 257, involving the principal of a high school who brought suit in conspiracy against the superintendent and three members of the Board of Education for attendant defamation to his character on charges preferred against him; and Anderson v. Rohrer, 3 Fed. Supp. 361, involving a conspiracy charge against a federal district attorney and others, are not applicable here because in each of them the alleged injuries resulted from the performance of official duties.

There can be no question about the jurisdiction of the Board of Bar Examiners here over the complaint against the plaintiff for alleged unprofessional conduct, nor can there be any question that the proceedings were judicial in their character when the Board of Bar Examiners acted on behalf of our Supreme Court.

Even though membership in the bar is a privilege burdened with conditions, as the late Mr. Justice Cardozo said in In re Roos, 221 N. Y. 81; 116 N. E. Rep. 182 (1911), the attorney is protected, like any other person, against a wrong, predicated upon actual malice, as set forth in the complaint in this case.

In Lance v. Apgar, 60 N. J. L. 441; 38 Atl. Rep. 695 (1891, Van Syckel, J.), it was held that the committing of a trespass upon the rights of another was, per se, a legal injury from which some damage to the plaintiff would be inferred. If the extent of the injury is not proven,' nominal damages only can be recovered, citing Golden v. Knapp, 41 N. J. L. 215 (Supreme Court, 1819, Beasley, C. J.).

Mr. Justice Garrison in Haines v. Schultz, 50 N. J. L. 481; 14 Atl. Rep. 488. (Supreme Court, 1888), said that punitive' damages rest' primarily upon the single ground—wrongful motive; that the engrafting of this notion on to personal suits has resulted .in an anomalous rule, the doctrine of punitive damages being a sort of hybrid between a display of ethical indignation and the imposition of a criminal fine, but whether it is regarded in the one light or the other, it is the wrongful personal intention to injure that calls forth the penalty.

In this type of action, where the gist is the actual malice of the wrongdoer, surely punitive damages may be allowed.

I therefore conclude that the complaint sets forth a legal cause of action and is not against public policy. The motion to strike must therefore be denied, but because of-the novelty of the questions involved, there will be no costs.


source: Caselaw Access Project

author: Waesche, President.

license: Public Domain

text:
    State Board of Tax Appeals.
    IN THE MATTER OF THE PETITION OF JOHN MANEELY COMPANY (A DELAWARE CORPORATION), FOR REVIEW OF ASSESSMENT OF FRANCHISE TAX FOR YEARS 1939, 1940 AND 1941.
    Decided June 29, 1943.
    Tor the petitioner, J oseph Beclc Tyler.

    Tor the state, John Solan.

   Waesche, President.

Petitioner, a Delaware corporation, appeals from the assessment by the State Tax Commissioner of franchise taxes for the years 1939, 1940 and 1941, assessed in accordance with the provisions of R. S. 54:32A-8; N. J. S. A. 54:32A-8. The three petitions, involving the same questions of fact and law, were heard together and are decided together.

The testimony discloses that the petitioner was incorporated in 1933; that it was and is still chiefly engaged in the sale and distribution of pipe, and that for this purpose it acquired a large warehouse and garage in North Bergen, New Jersey; that in 1936 it closed its ofíiee and warehouse in New Jersey, moved the pipe stored therein to Philadelphia, Pennsylvania, and ceased carrying on this business in New Jersey. It sold the warehouse in 1937, but retained ownership of the garage and considerable vacant land adjoining the warehouse. These properties were purchased and paid for by the issuance of corporate stock on the part of petitioner. The garage is presently rented by a rubber manufacturer. In addition to these properties, petitioner owns a very large building in Jersey City known as the Barron Building, together with adjoining land and some houses erected thereon. This building was never used by it in connection with the sale and distribution of pipe, but since its acquisition has been rented to the Lambert Pharmacal Company and other tenants. It also owns a piece of vacant ground at Newark Bay, some of which is apparently rented. Although the building never was used in the sale and distribution of pipe, it was likewise paid for by issuance on the part of petitioner of corporate stock to the prior owner, who was one of the founders of the petitioner company.

Petitioner offered evidence that it had not sold, or attempted to sell, any pipe in New Jersey since 1936; that it had entered into no contracts in this state, other than contracts for the repair and maintenance of its property situate therein; that all of its leases were executed and its rents payable at its Philadelphia office, all for the purpose of showing that it had abandoned doing business in New Jersey.

The contention that petitioner is not doing business in the State of New Jersey and not exercising its franchises within this state, and is therefore subject only to the minimum annual tax of $25, is not supported by the provisions of its corporate charter. Petitioner is by its charter specifically authorized to acquire by purchase or lease and to hold, use, sell, deal in or otherwise turn into account any real estate or buildings and in addition its charter contains these provisions:

“With a view to the working and development of the properties of the Corporation, and to effectuate, directly or indirectly, its objects and purposes, or any of them, the Corporation may, in the discretion of the Directors, from time to time carry on any other lawful business, manufacturing or otherwise, to any extent and in any manner not unlawful.”

The case, as disclosed by the entire record, is found by the Board to be this: Petitioner is chiefly engaged in the sale and distribution of pipe. It has also been engaged from the date of its incorporation in the operation and leasing of New Jersey real estate. This Board determines, as that portion oí the evidence discloses, that the Barron Building was never used by petitioner in connection with the sale of pipe and was never intended to be, but that the gross rentals from this enterprise approximate $50,000 per annum. Certainly, in view of the size of the annual rentals derived from these fixed assets in New Jersey, it can hardly be stated that petitioner neither does business nor exercises its franchises in the state within the purview of the statute. If petitioner discontinued the pipe business altogether, wherever the same be located, and leased all of its buildings, it could hardly be said that it had ceased doing business or exercising franchises altogether within the meaning of any taxing statute containing those phrases. If its other properties were as valuable as its New Jersey real estate, petitioner might still be a venture of great profit to its stockholders. The argument that petitioner is already paying taxes on its real estate and that this additional tax is inequitable might have some political force with the legislative branch of the government, but the Board is administering legislative policy which has already been fixed.

Petitioner cites R. S. 14:15-1; N. J. S. A. 14:15-1, whereby, under the General Corporation Act of this state, a foreign corporation has the right to “hold and use for the purposes of the corporation such real estate in this state as may be devised or conveyed to it, * * This section merely gives the creature of another sovereignty certain rights which it might not otherwise have in this sovereignty. While it gives a foreign corporation certain powers and rights in our state, this quoted section does not give these creatures of another state any immunity from taxation, nor can it be read to do so.

The assessments are therefore affirmed.


author: Leyden, C. C. J.

text:
    Bergen County Circuit Court.
    BOROUGH OF EAST RUTHERFORD, A MUNICIPAL CORPORATION, PLAINTIFF, v. STERLING PAPER CONVERTING COMPANY, A CORPORATION, DEFENDANT.
    Decided July 19, 1943.
    For the Borough of East Rutherford, Dominick Marconi and Thomas L. Zimmerman, Jr.

    For the Sterling Paper Converting Company, Pitney, Hardin & Ward.

   Leyden, C. C. J.

On the 9th day of May, 1935, the plaintiff, the Borough of East Rutherford, demised to defendant, Sterling Paper Converting Company, a parcel of land and buildings of the municipality, not then needed for public use, for a term of five years, to commence on the 1st day of January, 1936, and to end on the 31st day of December, 1940, at the yearly rental of $4,800 payable in equal installments of $400, in advance, on the first day of each and every month. The lease provided that the defendant "shall have the option, at any time after the first day of January, 1939, and for the duration of the balance of the term of this lease, to renew the same and to extend the term thereof for a period of ninety-nine (99) years, which said option for such extension may be exercised by giving written notice to the Borough Clerk of the Borough of East Rutherford, which said notice shall stipulate the day within such period upon which said term shall commence, * *

The defendant entered into possession of the premises pursuant to the lease, and in accordance with its terms made repairs, improvements and alterations to the alleged value of $68,976.18. It paid the stipulated rent of $400 per month to and including the month of December, 1940.

On September 30th, 1940, in conformity with the provision of the lease the defendant gave written notice to extend the term of the lease, effective October 1st, 1940, to the borough clerk of the plaintiff.

On December 2d, 1940, the council of the Borough of East Rutherford passed a resolution, approved by its mayor, the substance of which is that the option to extend the term of the lease between the plaintiff and defendant was not recognized or accepted by the Borough of East Rutherford; that the Borough considered the option clause illegal, improperly entered into, and therefore null and void and that the defendant was to pay the rent of $400 per month in accordance with the original terms of the lease.

The defendant remains in possession of the premises in question and has consistently offered to pay the yearly rental pursuant to the terms and conditions of the extended term. The Borough has refused the offers and insists upon the payment of rent at the rate of $400 per month.

In this state of affairs plaintiff instituted the present action in ejectment. The complaint contains three counts, the first demanding possession of the premises in question as of January 1st, 1941, and $11,200 for mesne profits and damages; the second, for the use and occupation of the premises at the reasonable value of $400 per month from the 1st day of January, 1941, and the third, for damages on an implied contract arising out of the continued use and occupation of the premises by the defendant at a rental of $400 per month from the 1st day of January, 1941, to the 1st day of April, 1943 (see Supreme Court rule 184, N. J. 8. A. tit. 2).

The defendant’s answer to the third count admits the plaintiff’s ownership of the premises in question subject to the defendant’s leasehold interest and right to possession. It admits the execution of the lease of May 9th, 1935, and possession of the premises since May 2d, 1936. It further admits the plaintiff’s alleged notice to quit of December 2d, 1940, and the non-payment of $400 per month rent to the plaintiff since January 1st, 1941 (see Supreme Court rule 185).

The separate defense to the third count asserts that the defendant is lawfully in possession of the premises and is entitled tó continue possession thereof by virtue of the provisions of the lease of May 9th, 1935, and the exercise by the defendant of the renewal and extension option therein contained, and by the payment of all rent and the performance of all covenants on its part by the provisions of the lease to be paid or performed (see Supreme Court rule 185).

By way of counter-claim the defendant asserts that since it has been in possession of the premises it has erected and constructed permanent improvements to and upon the land .in question of the alleged value of $68,976.18, and demands that in the event the plaintiff obtains a judgment of possession of the premises, that the defendant have judgment against the plaintiff on the counter-claim for. said sum (see Supreme Court rule 188).

The motion is to strike the answer, and separate defense to the third count, and the counter-claim, upon the ground that they are sham and insufficient in law.

•It might not be amiss to point out, although no point is made of it, that the plaintiff will not be permitted to treat the possession of the defendant as that of a trespasser and that of a lawful tenant during the same period. Mason v. Haurand, 79 N. J. L. 375; 75 Atl. Rep. 452.

Conceding that the Borough of East Butherford had the power to lease for a fixed and limited term any land or building of the municipality not presently needed for public use (N. J. S. A. 40 :60-42) the plaintiff argues, in support of its motion, that the lease in question, running as it does fox a period of five years with the option to renew and extend for ninety-nine more years, is not for a fixed and limited term, and the making of said lease was beyond the power of the municipality and void; that as a necessary consequence the answer and separate defense setting up defendant’s right to possession under the lease and its extension are insufficient in law and should be stricken. The plaintiff embellishes its argument with the contention that the plaintiff had no power to enter into a lease option agreement. It would seem, however, that the power to make the lease option agreement is incident to the granted power to make the lease, a power arising by necessary or fair implication out of the granted power.

Whether the pleaded answer and separate defense are sufficient in law depends upon the construction to be given to the lease. Under our eases a lease for five years with an option to renew and to extend the term for ninety-nine years becomes, when the lessee exercises its option, a demise for one hundred four years from its execution. Kahn v. American Stores Co., 94 N. J. L. 367; 110 Atl. Rep. 562; affirmed, 96 N. J. L. 292; 114 Atl. Rep. 926. It is, therefore, a lease for a fixed and limited term from the date of its execution. There seems to be no statutory limitation on the number of years for which the demise may run, that matter apparently being left to the sound and considered judgment and discretion of the governing body of the municipality. In this connection the lease in question has some unusual features. It provides, among other things, that during its term and any extension thereof, at least 80% of defendant’s employees shall be persons residing in the Borough of East Butherford, provided the municipality is able to furnish such a number willing and able to do the work required at the prevailing wage being paid by the lessee, and it gives the municipality and its duly designated agents and officials the right to enter the demised premises and to inspect the list of employees hired by the defendant. It also provides that the defendant, within the first three years of the lease, will lay out and expend the sum of at least $25,000 in alterations, additions and repairs to the demised premises, which alterations, &c., are ultimately to become the property of the Borough; and that the defendant in the making thereof will employ labor and engage a contractor or builder residing in the' Borough if such can be obtained and are capable of performing the work. r.

If the defendant can demonstrate at the trial that it properly exercised its rights under the option agreement to renew and extend the lease, the answer and separate defense are sufficient in law. Likewise it follows since contracts of municipal corporations stand on the same footing with contracts of natural persons and depend on the same circumstances for their validity and effect (Mayor, &c., of Jersey City v. Town of Harrison, 71 N. J. L. 69; 58 Atl. Rep. 100; affirmed, 72 N. J. L. 185; 62 Atl. Rep. 765; 65 Atl. Rep. 507), that the resolution of the council of the Borough of East Rutherford, passed and approved on December 2d, 1940, after the plaintiff had given notice of the exercise of its option to extend the term of the lease on October 1st, 1940, was ineffectual for the intended purpose. A municipality cannot rescind or dissolve an existing contract binding upon it by merely adopting a resolution to that effect. Buckley v. Mayor and Aldermen of Jersey City, 105 N. J. Eq. 470; 148 Atl. Rep. 630; affirmed, 107 N. J. Eq. 137; 151 Atl. Rep. 905.

The counter-claim will also be permitted to stand, as the •attack upon it is to the same effect. Where mesne profits are demanded, the value of permanent improvements may be allowed to the defendant and set off against the damages ■of the plaintiff in the situation set forth in the statute, N. J. 8. A. 2 :51-48, and Supreme Court rule 188. In the circumstances the determination of the validity of the counter-claim should be left to be disposed of at the trial by the trial judge.

The motion to strike is therefore denied.


author: Kraemer, M. B.

text:
    State Board of Tax Appeals.
    CITY OF NEWARK, PETITIONER, v. INTERNATIONAL BUSINESS MACHINES CORPORATION, RESPONDENT.
    Decided July 13, 1943.
    For the petitioner, Raymond Schroeder (by Vincent Casale).

    For the respondent, Sydney G. Soons.

   Kraemer, M. B.

This is an appeal by the City of Newark from the judgment of the Essex County Board of Taxation, reducing the personal property assessment for the year 1941 of International Business Machines Corporation, a foreign corporation, from $500,000 to $452,947.86.

It appears that the respondent made its return to the assessors of Newark, based upon the ownership of tangible property to the amount of $451,784.19. Respondent further stated that it had accounts receivable amounting to $26,264.89. The $500,000 assessment is based upon these two items and the additional amount of the assessment is justified by petitioner as capital employed by this foreign corporation in doing business.

The first two items appear proper, both in the return and upon the testimony offered by respondent.

The third item, forming the balance of the original assessment, namely, $21,950.92, is attempted to be justified in R. S. 54:4r-19; N. J. S. A. 54:4-19, which states:

"All corporations regularly doing business in this state and not being corporations thereof shall be assessed and taxed for and in respect of the business so done by them, and all such companies other than insurance companies, shall be assessed for the amount of capital usually employed in this state in the doing of such business, and not otherwise taxed as real property or tangible personal property by virtue of this chapter. The assessment shall be made in the taxing district where the business is most usually carried on and transacted.”

Considering the fact that the return fails to include any such item, but that the testimony discloses an annual business done out of the Newark office in excess of $700,000; that the expenses of doing business, other than payroll, were $59,490; that the Newark office employed 104 persons and that the payroll of this office was in excess of $311,000 a year, and that counsel who represented the corporation gave no figures indicating that the assessment in this respect was improper or unfair, the Board feels that the item of $21,950.92 should stand.

Respondent in turn made claim, as an item of deduction from intangibles, certain debts due various creditors, residing in Newark, in the sum of $13,325,509.25, the largest item being a claim of $13,122,791.66 due Prudential Insurance Company of America on bond issues, with accrued interest. At the hearing it sought deduction for such portion of this debt as would be allocable to its Newark office, according to Household Finance Co. v. State Board of Tax Appeals, 119 N. J. L. 230; 196 Atl. Rep. 219. Petitioner resists this deduction on the ground that a foreign corporation is precluded from making the same under the statute. The present state of the law appears to be contrary to this contention. Household Finance Corp. v. State Board of Tax Appeals, 126 N. J. L. 399; 19 Atl. Rep. (2d) 816.

However, another and far more serious obstacle presents itself to this allowance. The statute which governs the deduction for debts, R. S. 54:4—14; N. J. S. A. 54:4^14, states as follows:

“After making the valuation of the personal property for which a person shall be assessed the assessor may deduct therefrom all debts bona fide due and owing from such persons to creditors residing in the state, but no such deduction shall be made unless the debtor shall make claim therefor in writing under oath and therein set forth the debts owing by him, when incurred, to whom owing and where the creditor resides, the total amount of personal property of the claimant, including debts owing to him from solvent debtors, and also that no part of the debt was 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 the claimant, whether in trust or not. A claim on behalf of a corporation shall be subscribed and sworn to by the president or principal officer.”

The deduction in question was made in a separate schedule annexed to the printed return and the affidavit in connection therewith, taken by the vice-president of respondent, reads as follows:

“This claim is filed in good faith under oath and seal and is executed in behalf of International Business Machines Corporation by the undersigned, principal officers of said corporation.”

The printed form supplied by the city, which was sworn to by the secretary and treasurer of the corporation, left blank the portion thereof relative to debts of the corporation and referred the local assessors to the annexed schedule. This printed form, however, contained the words:

“The following is a just and true statement of debts due and owing, by the corporation, firm or individual making this return, to creditors residing in the State of Hew Jersey, on October 1st, 1940, with the names and addresses of such creditors and no part of such indebtedness was created for the purpose of reducing the tax.”

Giving this the construction most favorable to respondent, namely, that the affidavit of the vice-president shall be'read in connection with the return signed by the secretary and treasurer, the claim must fail in two respects:

1. It fails to contain “the total amount of personal property of the claimant, including debts owing to him from solvent debtors.” Household Finance Corp. v. State Board of Tax Appeals, 126 N. J. L. 399; 19 Atl. Rep. (2d) 816.

2. It likewise fails to contain a statement “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 the claimant, whether in trust or not.”

Full and exact compliance with the statute in this regard is imperative, in order to enforce deduction of this nature by assessors. Substantial compliance is insufficient. Household Finance Corp. v. State Board of Tax Appeals, 119 N. J. L. 230; 196 Atl. Rep. 219.

From the foregoing it is quite apparent that the deduction sought cannot be allowed to respondent. Wherefore, the original assessment of $500,000 must be reinstated.

Judgment accordingly.


author: Haktshokne, C. P. J.

text:
    Essex County Court of Common Pleas.
    BOARD OF COMMISSIONERS, CITY OF NEWARK, COMPLAINANT-APPELLEE, v. JOSEPH W. GRODECKI, DEFENDANT-APPELLANT.
    Decided July 21, 1943.

      For the complainant-appellee, Raymond Schroeder, corporation counsel (Louis A. Fast).

    For the defendant-appellant, Charles W. Chadwich.

   Haktshokne, C. P. J.

Defendant appeals from his conviction in the First Criminal Court of the City of Newark for the violation of a city ordinance, known as section 634 of the Revised Ordinances of the City of Newark, Revision of 1913) as amended. This ordinance, as amended, was adopted in 1942, and not only prohibits gaming of all sorts but provides that “no person shall * * * have in possession any ticket, slip, or other writing or printing * * * indicating an interest, share, bet or pledge in any pool, lottery, racing, contest or other game of chance * * *.” The evidence shows that defendant had in his possession writings indicating bets on prize fights and basketball games with the names of the bettors, the amount bet, indicating those who did or did not pay, those who won and those who lost. There were also sheets of “Eddie’s Basketball Service,” indicating the games for the week, on which were marked in pencil the odds on the game, the names of the bettors, together with similar papers indicating odds and bettors’ names on hockey and football games. It was also testified that defendant requested the return of a slip containing names of bettors, as he would not know who to pay off and who not to pay.

The defendant grounds his appeal on the claims, (1) that the ordinance under which he is convicted is invalid, (2) that the above evidence does not show him to have violated such ordinance.

Appellant claims the ordinance to be invalid not because of any defect or lack of completeness in its substance, but (1) because it was adopted, not as an original ordinance, but as an amendment to the original ordinance of 1933. section 634, and (2) because it does not expressly state the date it is to be effective.

This original ordinance appellant claims to be invalid since its penal clause fixes a mandatory penalty of “ten dollars for each offense.” This, of course, violates the provisions of the Home Buie Act covering all municipalities (Pamph. L. 1917, p. 347; N. J. S. A. 40:49—5), which directs these ordinances to provide penalties in the discretion of the magistrate, for detention “not exceeding ninety days or a fine not exceeding two hundred dollars, or both.” Pfister Chemical Co. v. Romano, 15 N. J. Mis. R. 71; 188 Atl. Rep. 727; Fields v. Duffy, 115 N. J. L. 319; 180 Atl. Rep. 225.

Appellant thereupon argues that, though complete and perfect in itself, the instant ordinance, purporting to amend an invalid ordinance, is itself invalid, citing Lassiter v. Atlantic City, 86 N. J. L. 87; 90 Atl. Rep. 675, 676. But in this case the situation is quite different from that in the Lassiter case. There “the amending ordinance, standing by itself, did not provide for any license,” the very point at issue being whether or not the defendant Lassiter should have taken out a license. Thus, as the court continues, the later ordinance, “standing by itself, would not support the present conviction.”

In other words, there is a substantial difference between an amendment which is complete in itself, and one which changes but a few words in a previous ordinance, and is incomplete in itself. Obviously the latter, as the Lassiter case holds, does not itself express the clear will of the legislative body. It cannot itself notify the citizens, for whose governance it is adopted, of what that legislative will is. To do so, there must be added to such amendment the original enactment. But this original enactment is a nullity, or at least unenforceable, and hence adds nothing to the incomplete amendment. Such incomplete expression of the will of the governing body clearly cannot support a conviction.

On the other hand, if the enactment, which is later adopted, is complete in itself and without defect in its substance, it does clearly express the will of the enacting authority, and does give full notice to the citizens for whose benefit it is adopted. If these, the prime purposes for its existence, have therefore been completely accomplished, to invalidate the ordinance would defeat these prime purposes. Its defect is that the enacting authorities have mistakenly asked that it be inserted in a somewhat inappropriate place in the body of their law, i. e., as an amendment to a previously existing enactment rather than as an independent enactment. Bor its legal effect in actually changing the original enactment is the same, whether it be adopted as an amendment or as an independent act. In either event, the later expression of the legislative will governs, and the previous inconsistent expression is wiped out, whether the later expression be expressly by amendment or by an independent enactment.

Surely, when the prime purpose of the enactment has been met, both so far as the governing authority and the citizens are concerned, it is of little moment whether the later enactment has been fitted into the most appropriate, or a less appropriate, niche in the hall of municipal or legislative records. Hence, for all practical governmental purposes it is unimportant, from the standpoint of its validity, whether an ordinance, complete and perfect in itself, is recited as an independent enactment, or as an amendment to a previous ordinance.

And so are the authorities, both as to ordinances (Public Service Co. v. Ridgewood, 6 N. J. Mis. R. 435; 141 Atl. Rep. 672; 43 C. J. 561, § 883; People v. Bowman, 253 Ill. 234; 97 N. E. Rep. 304; La Crosse v. Elbertson, 205 Wis. 207; 237 N. W. Rep. 99; and as to statutes (State, Trenton Iron Co. v. Yard, 42 N. J. L. 357; Smith v. Howell, 60 Id. 384; 38 Atl. Rep. 180). Similar is the holding in the leading case of Allison v. Corker, 67 N. J. L. 596; 52 Atl. Rep. 362, though in that case the new amending statute was not complete in itself, so that the original act, found invalid, had to be read in connection therewith. Nevertheless, despite the fact that the amending statute was incomplete, as was the ordinance in the Lassiter case, supra, the court in the Allison case concludes that this incomplete act, amendatory of a previously invalid act, was itself valid and enforceable. The court reaches this conclusion on the ground “'that an unconstitutional statute is nevertheless a statute,” so that the provisions of the valid act were still “a fact to be reckoned with.” It is clearly in this connection that the court says that, “The Supreme Court cannot set aside a statute as it can a municipal ordinance.” In other words, an unconstitutional statute may yet support an amending statute, as the former is still “a fact to be reckoned with,” whereas an unconstitutional municipal ordinance may bo a nullity, which cannot support an incomplete, amending ordinance, according to the Lassiter ease. And this is the general rule.

Similarly, even where a statute has been repealed our courts have held it may be amended, provided the new enactment is a law complete in itself. Abrams v. Smith, 98 N. J. L. 319; 119 Atl. Rep. 792. And such is the weight of authority. Crawford, Construction of Statutes, § 117; Commonwealth v. Kenneson, 143 Mass. 418; 9 N. E. Rep. 761; Columbia Wire Co. v. Boyce, 104 Fed. Rep. 172; Beatrice v. Masslich, 108 Id. 743.

Since the amending ordinance here in question is complete in itself, both reason and authority support its validity in this regard, irrespective of its labeling as an amendment to a previous invalid enactment.

This conclusion renders it unnecessary to consider the question upon the assumption that the original Newark ordinance was but partially invalid. Doran v. Camden, 64 N. J. L. 666; 46 Atl. Rep. 724.

As to defendant-appellant’s second point, that the ordinance does not expressly state the date it is to be effective and that it is consequently void, it is to be noted that there is no statutory enactment as to when ordinances are to be deemed to be intended to take effect in the absence of an express statement, as there is in the ease of statutes, i. e., July 4th (N. J. S. A. 1:2-3). Nor is there any statutory requirement applicable to penal ordinances, such as this, expressly as to the time of their taking effect, the provisions in that regard applying only to ordinances authorizing improvements, incurring of indebtednesses, or otherwise. (R. S. 40:49-9; 40:49-27; 40:74-4; N. J. S. A. 40:49-9; 40:49-27; 40:74-4.) The Home Eule Act, however, provides : “Upon passage, every ordinance or the title * * * shall be published * * (R. S. 40:49-2; N. J. S. A. 40:49-2.) The Commission Government Act provides—with exceptions here immaterial—that, “No ordinance * * * shall take effect less than ten days from the time of its final passage.” Thereafter follow detailed provisions to delay such taking effect in case during such ten days there is a remonstrance filed by the voters against its taking effect. R. S. 40:74-5; N. J. S. A. 40 :74-5.

In other words, and assuming that both the Home Eule Act and the Commission Government Act apply (compare Peter’s Garage v. Burlington, 121 N. J. L. 523; 3 Atl. Rep. (2d) 634; affirmed, 123 N. J. L. 227; 8 Atl. Rep. (2d) 910), no ordinance, such as that in question, can take effect at passage, or subsequent to passage, until ten days have elapsed after passage and the ordinance has been once published. Even then it cannot take effect if there has been a statutory remonstrance by the voters. With these varied, contingent, and complicated statutory provisions in mind, we find that the ordinance in question provides: “(2) This ordinance shall take effect as in law provided.

Clearly, the purpose of the governing authorities in using this language was, on the one hand, to avoid setting forth at length these intricate provisions expressly, and, on the other hand, to avoid the illegal statement that such ordinance should take effect on its passage. Bowyer v. Camden, 50 N. J. L. 87; 11 Atl. Rep. 137; Anderson v. Camden, 58 N. J. L. 515; 33 Atl. Rep. 846. The course adopted by the governing authorities, of incorporating the requirements of the above statutes by reference, was the simplest method they could use to indicate their intent, that when these varied statutory conditions were met, the ordinance should then take effect.

Indeed, this not only comports with the reasonable intention of the governing body of the municipality, but with that of the legislature itself. For while the Home Kule Act does not state in so many words that the publication above alluded to (R. S. 40:49-2; N. J. S. A. 40:49—2) shall occur “before any ordinance shall take effect,” such is its obvious intent, such words in fact having been used in several oE the underlying statutes from which the revision of the section in question was compiled. (Pamph. L. 1917, oh. 152, p. 345, § 1; Pamph. L. 1918, eh. 163, p. 478, § 1; N. J. 8. A. 40:49—1, 40:49-2, 40:49—6.) Of course, in the absence of evidence of a contrary intent, the governing body must be presumed to have intended that this penal ordinance, for the protection of the public, should take effect as soon as the statutory requirements permitted.

And so are the authorities. In fact, the courts are apparently in general accord on the following principles pertinent to this situation:

(1) When a governing body has stated no effective date for an ordinance, it will be held to be effective on its passage, in the absence of contrary provisions in the constitution or statutes. “The common rule in regard to legislation is that it shall take immediate effect unless otherwise provided. This rule is applied to ordinances.” 2 McQuillin Revised, 732 § 702. 43 C. J. Municipal Corporations, 576, § 923.

(2) When the governing body has stated in an ordinance an effective date which is invalid, this will not invalidate the ordinance itself. Bowyer v. Camden, supra; Anderson v. Camden, supra; Stuhr v. Hoboken 47 N. J. L. 147; McLaughlin v. Newark, 57 N. J. L. 298; 30 Atl. Rep. 543; affirmed, 58 N. J. L. 202; 34 Atl. Rep. 13; Community Natural Gas Co. v. Northern Texas Utilities, 13 S. W. Rep. (2d) 184, 193 (Texas). This is for the reason that, regardless of the exact date when an ordinance is stated by the governing body to be effective, it is clear beyond peracventure that the governing body desires the ordinance to become effective at some time. Hence, the courts hold the provisions as to the effective date to be separable from the body of the ordinance, and it follows that this separable provision, even though invalid, cannot affect the validity of the body of the ordinance, under well settled principles.

(3) When the governing body has stated an effective date which is illegal, the ordinance will be held to be effective as nearly as possible in accord with the legislative intent, and in conformance with the constitutional or statutory provisions. (See cases cited under point 2, supra.)

(4) It would seem to follow as a corollary of the above principles that when, as here, the governing body has stated no effective date expressly, and there is no indication otherwise of an intent to delay the effective operation of the ordinance, but there are pre-existing constitutional or statutory requirements, such ordinance will be held to take effect upon compliance with such pre-existing requirements.

In any event, it would seem clear that since the fixing of an illegal effective date will not invalidate the ordinance, the fixing of no specific date, but the expression of the will of the governing body to proceed “as in law provided.” cannot invalidate it. This objection of defendant-appellant, therefore, falls to the ground.

Appellant also contends that the tacts do not show him to be guilty of. a violation of the present ordinance, citing People v. Gittens, 78 Misc. 7; 137 N. Y. S. 670; People v. Laude, 81 Misc. 256; 143 N. Y. S. 156, as indicating that the ordinance does not cover private Lets. Clearly, one who makes a private bet is not a bookmaker in the commonly accepted meaning of that term. But the ordinance here in question is by no means as narrow as the New York statute construed in the above cases, which covers bookmaking alone. The ordinance in question is particularly broad in character, having been much widened in its scope from its original form, fonnd to be invalid as above. We quote the substance of the instant ordinance:

“The Board of Commissioners of the City of Newark do ordain:

“1. That section 634 of the Revised Ordinances of The City of Newark (Revision of 1913), and as amended, he and the same is hereby amended to road as follows:

“Section 634. No person shall deal, play or engage in faro, roulette, or other device or game of chance, or buy or sell what is commonly known as a pool, or any interest or share in any such pool, or shall make or take what is commonly known as a book, upon the running, pacing or trotting of any horse, mare, gelding, or other animal, or any game, racing or contest, or have in possession any ticket, slip or other writing or printing, of an interest or share, or showing or indicating an interest, share, bet or pledge, in any pool, lottery, racing, contest or other game of chance, or shall keep or attend a place to which persons may resort for engaging in any such acts, or for betting upon the event of any horse race, or other race or contest, or for gambling in any form, and no person shall aid, abet, assist or participate in any such pool, lottery, race or other contest or game of chance.

“Each and any person violating any of the above provisions of this ordinance shall, upon conviction thereof, forfeit and pay a fine of not more than two hundred dollars ($200.00), or be imprisoned in the county tail for not more than ninety (90) days.”

In the above ordinance the “possession * * * [of a]

■writing or printing * * * indicating an interest, share, bet or pledge in any pool, lottery, facing, contest” * * * is expressly prohibited, and contradistinguished from the making of a “book” or the handling of a “pool.” Indeed, this prohibition of the possession of the indicia of, or means to, gaming, and even irrespective of the possessors’ criminal intent, has been upheld by our courts as a valid exercise of the legislative power, separate and distinct from gaming itself, and as “a measure that is primarily preventive in character.” State v. Murzda, 116 N. J. L. 219, 226; 183 Atl. Rep. 305, 309. Furthermore, the facts would indicate that the defendant was not a mere private bettor, but that he was engaged, partially at least, in the occupation of taking bets on these “contests” from a large number of individuals, whether he himself was a bettor with them therein or not, being immaterial.

In short, since it clearly appears that the amendatory ordinance, under which the defendant was convicted, is complete in itself and valid, despite the invalidity of the original ordinance, and the fact that the present ordinance does not expressly name a date for its taking effect, and since the facts show the defendant to have violated the same, the conviction under review will be affirmed.


author: Pabkbe, J.

text:
    HENRY ATLAS SONS, INC., A NEW YORK CORPORATION, PLAINTIFF, v. EDWARD C. OERTZEN, DEFENDANT.
    Decided May 10, 1943.
    Before Justice Pabkee, at chambers.
    For the plaintiff, Eisenberg & Spicer.

    For the defendant, Michael Breibhopf.

   Pabkbe, J.

The defendant was hold to bail in a contract action by order of a Supreme Court Commissioner upon a claim that he had agreed, in substance, as a bond broker, to obtain for the plaintiffs a surety bond to a department of the Government in the sum of about $350,000, for which his commission was to be $7,500. The plaintiffs paid the defendant $1,000 on account subject to a,n agreement that it was to be returned if the defendant should fail to procure the bond as agreed. Part of the agreement was that the bond was to be acceptable to the department. It turned out that it was not acceptable and the plaintiffs demanded the $1,000 back and, failing payment, sued out a capias on the theory of the defendant having fraudulently incurred an obligation. Thereupon the defendant applied for, and obtained, an order for the taking of testimony concerning the truth of the proofs upon -which the order of bail was made pursuant to the statute, now R. 8. 2:27—78 and 79; N. J. S. A. 2:27-78, 2:27-79. Those proofs have been taken and the defendant asks to be discharged from arrest.

The arguments on this point seem to revolve around the question whether a voluminous indemnity agreement, partly printed and partly typewritten, contained on the second page thereof at line 125, when it was executed certain typewritten words. The defendant testified that those words were present when the agreement was signed by the plaintiffs; two of the plaintiffs testified that the typewritten words were not there. Line 125 reads as follows (in print) : “10. To, waive and do hereby waive * * * [in typewriter] Trust Agreement with Edward C. Oertzen May 21st, 1942.”

The plaintiffs rely, to some extent on the case of Painter v. Houston, 28 N. J. L. 121, decided in 1859, wherein it was held, among other things, that counter-affidavits could not be admitted at the hearing, but that rule was abrogated by the Act of 1861 (Pamph. L., p. 312, now R. S. 2:27—78; N. J. S. A. 2:27-78), and consequently the question to be decided is whether the proofs taken before the Commissioner pursuant to the statute clearly show that the writ should not have issued. This is the holding in Tyler v. Allen, 31 N. J. L. 441, decided in 1866, and based on the statute.

As I understand the practice, the burden of proof in a situation of this kind is on the defendant to show' that the affidavits on which the capias was issued were without substantial basis of fact. My conclusion in the matter is that in this case the defendant has not borne that burden, and consequently the application will have to be denied.


text:
    New Jersey Department of Labor, Workmen’s Compensation Bureau.
    PATRICK BREHENY, PETITIONER, v. COUNTY OF ESSEX, AND BANKERS INDEMNITY INSURANCE CO., RESPONDENTS.
    Decided July 14, 1943.
    For the petitioner, David Roslcein.

    For the respondent, Edwin Joseph O’Brien.

   An employee’s claim petition for compensation was filed by Patrick Breheny, petitioner in the above entitled matter alleging inter alia that his incapacity has increased since the prior adjudication of his claim for compensation on March 15th, 1940. This matter came on to be heard before me, Harry S. Medinets, a Deputy Commissioner of Compensation, in the presence of David Boskein, attorney for petititioner, and Edwin Joseph O’Brien, attorney for respondent.

The testimony of petitioner, Patrick Breheny, was taken de iene esse and the stenographic transcript was received in evidence at the time of the hearing, inasmuch as it appears that he was confined to his home and unable to appear in court. The uncontroverted testimony of the petitioner discloses that following the adjudication of this cáse in March 15th, 1940, he remained in the employ of the respondent in the performance of only light duties until the early part of June of that year, when, as a result of his physical condition he was compelled to cease work completely. Since that time, petitioner has been confined to his home and for the last five months confined to his room under the care of Dr. Mulligan. Although Mrs. Breheny, wife of the petitioner, appeared prepared to testify in support and in corroboration of her husband’s testimony, the attorney for the respondent waived formal proof and conceded the factual effect of her proffered testimony.

On behalf of the petitioner, there was adduced the testimony of Dr. Jerome Kaufman a recognized cardiologist. He had occasion not only to make a complete physical and cardiological examination but also to take electrocardiograms and make other diagnostic tests in order to determine the petitioner’s present condition. It was the opinion of this doctor that the petitioner is totally and permanently disabled. Prom the facts submitted in a hypothetical question based on the evidence adduced at the time of the prior hearing, a study by Dr. Kaufman of the electrocardiograms offered in evidence in that proceeding, and a consideration of his own medical findings on examination and test, this expert was of the opinion that the petitioner’s incapacity, to the extent previously determined by this court as resulting from the accident of May 18th, 1938, had substantially increased.

It will be noted that the respondent does not presently contend that the petitioner is not totally incapacitated, nor has there been offered any proof, medically or lay, to controvert that fact. The contention of the employer from a medical standpoint appears to be that this complete incapacity is not causally related to the compensable accident. There appeared and testified on behalf of the respondent Dr. Harry A. Jaffe, an outstanding physician and surgeon of New York City, Dr. Joseph Doane, a specialist in internal medicine in New York City, and Dr. Leon Lewis, a registered pathologist of Newark, New Jersey: It was the opinion of Dr. Jaffe, based upon the facts set forth in the hypothetical question propounded by the respondent’s counsel, that the increase in the petitioner’s incapacity was not attributable to the accident of May 18th, 1938, or to its sequeli. This physician felt that the petitioner had recovered from the effects of the said accident, the coronary occlusion, and that the symptoms which now disable him are due to the natural progress of his underlying arteriosclerosis. Dr. Jaffe was joined in this view by Dr. Doane, who rendered the opinion that the physical retrogression of the petitioner’s condition was the inevitable result of the sclerosis of his cardiac vessels and was not due to the coronary occlusion which has heretofore been judicially determined to be the result of said accident. Dr. Leon Lewis, who had occasion to examine the petitioner at the time of the prior trial hearing, as well as shortly before the present trial, did not in any manner dispute the contention advanced on behalf ctf the petitioner that he is presently totally disabled. The report of Dr. Asher Taguda, who was in the military service and unable to appear in court was offered in evidence by the respondent and upon consent of the petitioner’s counsel its contents were included in the record with the same effect as if this physician appeared personally and testified.

It is to be observed that neither Dr. Jaffe nor Dr. Doane ever examined the petitioner and that their expert opinions were based solely upon the facts submitted to them by counsel in the form of hypothetical questions. It is fairly discernable from their testimony that the medical experts of the respondent predicated their opinions on the assumption that the petitioner, having returned to light work as a painter’s helper and continued as such from November, 1938, to early June, 1940, a period of approximately eighteen months, he therefore had recovered from the effects of the coronary occlusion. However, from a careful consideration of the entire record I am unable to discern testimony upon which this assumption can reasonably be based. The evidence is to the contrary. Even at the time of the prior adjudication the petitioner was still suffering from the effects of the coronary occlusion, and, as previously determined, was disabled by reason thereof to the extent of 40% partial permanent total. The undisputed testimony on the present application in the ease that the same symptoms continued to manifest themselves following the earlier' hearing and within four months thereafter the petitioner was finally compelled to cease work completely. In this posture of the proofs it is difficult for the court to accept, the theoretical premise of the respondent’s experts that the petitioner had fully recovered from his coronary occlusion. Quite the contrary, it is well within the range of reasonable probability to conclude that a causal relationship exists between the physical incapacity which necessitated a complete cessation from work four months after the last adjudication following which there was a continuity of the very symptoms which this court previously found to be attributable to the traumatic insult to the underlying arteriosclerotic cardiovascular system of the petitioner which produced the spasm of the coronary artery and a resultant coronary thrombosis.

It is legally well settled that at a hearing, based on a claim for an increase in disability, the judgment of the Bureau with respect to the earlier trial is res adjudicaba of the nature and extent of the disability then existent. Cirillo v. United Engineers and Constructors, Inc., 120 N. J. L. 225; 198 Atl. Rep. 768; Rotina v. J. P. Scanlon, Inc., 125 N. J. L. 227; 15 Atl. Rep. (2d) 336, 752.

On the occasion of the earlier trial before me, the petitioner had already resumed work, confining himself “to the lighter duties of his trade.’’ I then found, and nothing has been shown in the present proceeding to discard that conclusion, that “the symptoms attributable to the said condition [coronary occlusion] have persisted to a marked degree and he [petitioner] is presently suffering from the affects of the said accident' * * *” “I therefore conclude that the petitioner’s disability attributable to the compensable accident was equivalent to 40% of partial total permanent.’’ The evidence adduced - at the present trial shows without contradiction that the same cardiac symptoms which I found were due to the accident, continued to distress the petitioner with the result that some four months after the first adjudication he was obliged to completely stop work and from that time up to the present he has been wholly and completely incapacitated and of late a room confined invalid. Concededly, the incapacity of the petitioner has increased to a point where he is without dispute totally and permanently disabled. Considering the petitioner’s apparent good health and unimpaired capacity for work prior to the accident, and in the light of subsequent developments it is inconceivable that the traumatic episode was not the outstanding factor in the enlarged existent total disability. Kolesnik v. Irvington Varnish and Insulator Co., 120 N. J. L. 8; 197 Atl. Rep. 727; Davis v. Lotz, 126 N. J. L. 615; 20 Atl. Rep. (2d) 602.

The rule is clear that the burden of proof is on the petitioner in an application to establish and obtain an increase in disability. Rotina v. Scanlon, supra; Pasquale v. Clyde Piece Dye Works, 120 N. J. L. 557; 1 Atl. Rep. (2d) 45. From a consideration of all the testimony adduced and the reasonable inferences drawn therefrom, I am constained to the opinion and find that the petitioner here has sustained the burden of establishing, by a fair preponderance of the credible testimony, that his disability has increased since the adjudication of March 15th, 1940, and that his present incapacity which was total in quality and permanent in character, hears a causal relationship to the compensable accident of May 18th, 1938. The respondent, in my opinion, has failed to carry the harden of proving that the admitted increase in tl\o petitioner’s disability is due to a cause other than that claimed by the employee. Atchison v Colgate, 102 N. J. L. 425; 131 Atl. Rep. 921.

It is, therefore, * * * ordered that judgment be and the same hereby is entered in favor of Patrick Breheny and against the County of. Essex and Bankers Indemnity Insurance Co.

* * ¡cm * # $

Harry S. Medísteis, Deputy Commissioner.


author: Caffrey, C. C. J.

text:
    MABEL B. ARONSON, PLAINTIFF, v. THE PRUDENTIAL INSURANCE COMPANY OF AMERICA, A CORPORATION, AND FIDELITY UNION TRUST COMPANY, A CORPORATION, ARTHUR F. EGNER AND ALEXANDER HARRIS, EXECUTORS AND TRUSTEES UNDER THE LAST WILL AND TESTAMENT OF LOUIS V. ARONSON, DECEASED, DEFENDANTS.
    Decided August 19, 1943.
    For the plaintiff, Milton M. Unger.

    For the defendant Prudential Insurance Company, Linda-bury, Depute <& Faudits (William L. Dill, Jr., of counsel).
   Caffrey, C. C. J.

The plaintiff, Mabel B. Aronson, has filed a complaint pursuant to the Uniform Declaratory Judgments Law, R. S. Title 2, article 6, R. S. 2 :26-66, et seq.; N. J. S. A. 2:26-66, et seq., seeking declaratory judgment as to her rights under life insurance policies of which she is the beneficiary.

The complaint sets forth, that on June 25th, 1923, a policy numbered 4367014 was issued to Louis V. Aronson (hereinafter referred to as the Insured) whereby the Prudential Insurance Company of America (hereinafter referred to as the Company) insured the life of said named insured, in the sum of $50,000, Gertrude Aronson being designated therein as the beneficiary.

The complaint further avers that on June 25th, 1924, another policy, numbered 4763987, was issued by the Company, for the face amount of $50,000 and in this policy, too, Gertrude Aronson was named as beneficiary.

The complaint further recites, that on December 2d, 1935, the Insured designated his then wife, Mabel B. Aronson, the present plaintiff herein, as the beneficiary under said policies; that on or about July 21st, 1939, at the request of the Insured, the beneficiary was changed—pursuant to the right of the Insured—to the executors or administrators of the said Louis V. Aronson. The policy provided for the payment to the beneficiary of monthly installments thereunder.

There is no question raised as to the right of the Insured to change the beneficiary in either or both policies. It is also conceded that at the time of the death of the Insured (November 2d, 1940) both policies were payable to the executors or administrators of his estate.

There seems to be no dispute, that decedent borrowed a sum of money from the Company, which, at the time of his death, amounted to $43,813.76.

It is admitted that Louis Y. Aronson, in his last will and testament, in paragraph fourteenth thereof, provided as follows:

“In the event that I have not prior to my decease constituted her as the beneficiary in two certain policies of life insurance on my life in The Prudential Insurance Company of America in the amount of Fifty thousand dollars ($50,000) each, then and in that event I direct that the proceeds of said policies of insurance be paid to my dear wife, Mabel B. Aronson.”

During the pendency of this matter, this court was asked to hold in abeyance his determination of the present motion, to await the outcome of an action instituted in the Court of Chancery, not only with respect to plaintiff’s position, but other matters between other parties interested in decedent’s estate. On December 8th, 1942, Vice-Chancellor Bigelow advised a decree, which, in so far as it affects the plaintiff relative to the subject-matter before me, reads as follows:

“(g) Policies of insurance upon the life of said Louis V. Aronson in the Prudential Insurance Company of America, being policies Nos. 4367014 and 4763987, each of said policies being in the face amount of $50,000, were by the last will and testament of said Louis V. Aronson, bequeathed to the defendant, Mabel B. Aronson, and she is, therefore, entitled to collect all sums due under said policies of insurance, to enforce all rights which may inhere in her as the person entitled to the said policies of insurance and the proceeds thereof.”

This decree (Chancery Docket 139/506) does not adjudge or settle any matter in controversy, so far as this court (i. e., Supreme Court) is concerned.

The defendant Company, through its counsel, concedes the right of the plaintiff herein, to the proceeds of the two insurance policies—after first deducting the admitted borrowings of the Insured on these policies. The plaintiff does not want this lump sum; she is asking this court to permit her to exercise Option 2 of the policies, which, of course, would be to her advantage, because the monthly installments derived by her would in all probability exceed any return she might receive, if the sum due on the policies were invested by her. To that end, the plaintiff asks this court to

(1) adjudge that the Prudential is obligated under said policies to permit plaintiff and the executors and trustees to exercise the option by them attempted to be exercised, as in said complaint set forth;

(2) that this court determine that at the time when said policies became payable, plaintiff was and ever since, has been and now is the beneficiary of said policies within the meaning thereof, and of Option 2 granted by said policies to the beneficiary thereof;

(3) that the plaintiff, or the executors, at the time of the death of the said Louis V. Aronson, and at the time the said policies became payable were, ever since have been and now are entitled to exercise said Option 2 contained in said policies;

(4) that having elected to exercise said Option 2 as herein-before stated, plaintiff is entitled to require the Prudential to retain the amount due on said policies, pursuant to the terms and provisions of Option 2 as exercised, payable as therein stated, for the age of the plaintiff at the time of death of said Louis Y. Aronson, together with dividends;

(5) that upon delivery of said policies, the Prudential shall be required to place on each of them, a suitable endorsement evidencing the exercise of said option, and to make, execute and deliver such other papers and writings as shall be necessary or proper to carry out the same.

The complaint contains other prayers, too.

I am of the opinion that the right of election is reserved either to the insured or to the beneficiary (see provisions of policy captioned: “Provisions as to Modes of Settlements at Maturity”). At the time of the death of Louis Y. Aronson, the plaintiff was not the designated beneficiary in the policies. Her right to the proceeds of the insurance policies comes to her as a legatee under the last will and testament of Louis Y. Aronson.

The citations in the defendants brief are convincingly in point.

To accede to the claim of the plaintiff and to grant her the relief sought, this court would have to decide and declare questions well beyond its jurisdiction.

Following Paterson v. Currier, 98 N. J. Eq. 48; 129 Atl. Rep. 711, and Empire Trust Co. v. Board of Commerce and Navigation, &c., et al., 124 N. J. L. 406-411; 11 Atl. Rep. (2d) 752, the complaint will be dismissed.


author: Oollestek, D. C. J.

text:
    Clifton District Court.
    JOSEPH FOX, PLAINTIFF, v. ARMOUR AND COMPANY, A CORPORATION, DEFENDANT.
    Decided August 25, 1943.
    For the plaintiff, Maurice F. Karp.

    For the defendant, John L. Ridley.

   Oollestek, D. C. J.

The plaintiff, Joseph Fox, brings this action to recover overtime pay, liquidated damages and an award for a counsel fee under the Fair Labor Standards Act of 1938 commonly referred to as the Federal Wage and Hour Law, 39 U. 8. 0. A., §§ 301 et seq. Plaintiff was employed by the defendant corporation for a period of 28 years serving the last 22 years in the shipping department. He left his employment on December 21st, 1940.

The pertinent provisions of the act applicable to this proceeding are as follows:

Section 7 (section 207) “(a). No employer shall, .except as otherwise provided in this section, employ any of his employees, who is engaged in commerce or in the production of goods for commerce—

“(1) for a work week longer than 44 hours during the first year from the foregoing date of this section,

"(2) for a work week longer than 42 hours during the second year from such date, or

“(3) for a work week longer than 40 hours after the expiration of the second year from such date,

unless such employee receives compensation for his employment in excess of the hours above specified at a rate not less than one and one-half times the regular rate at which he is employed.”

Section 13 (section 213) "(a) The provisions of sections 6 and 7 shall not apply with respect to—■

(1) any employee employed in a bona fide executive, administrative, professional or local retailing capacity, or in the capacity of outside salesman (as such terms are defined and delimited by regulations of the Administrator); * * *”

Section 16 (section 216) "(b) Any employer who violates section 6 or section 7 of this Act shall be liable to the employee or employees affected in the amount of their unpaid minimum wages or their unpaid overtime compensation, as the case may be, and in an additional equal amount as liquidated damages. Action to recover such liability may be maintained in any court of competent jurisd iction by any one or more employees for and in behalf of himself or themselves and other employees similarly situated, or such employee or employees may designate an agent or representative to maintain such action for and in behalf of all employees similarly situated. The court in such action shall, in addition to any judgment awarded to the plaintiff or plaintiffs, allow a reasonable attorney’s fee to be paid by the defendant, and costs of the action.”

It is the contention of the defendant corporation that the plaintiff was employed in a bona fide executive capacity and that therefore under section 13 (a) (1) of the act is exempt from the provisions thereof.

The Administrator in his regulations has defined “bona fide executive” as used in the act as follows:

Section 541.1 Executive. The term “employee employed in a Iona fide executive * * * capacity” in section 13

(a) (1) of the act shall mean any employee

(a) whose primary duty consists of the management of the establishment in which he is employed or of a customarily recognized department or subdivision thereof, and

(b) who customarily and regularly directs the work of other employees therein, and

(c) who' has the authority to hire or fire other employees or whose suggestions and recommendations as to the hiring or firing and as to the advancement and promotion or any other change of status of employees will be given particular weight, and

(d) who customarily and regularly exercises discretionary powers, and

(e) who is compensated for his services on a salary basis of not less than $30.00 per week (exclusive of board, lodging or other facilities) and

(f) whose hours of work of the same nature as that performed by non-exempt employees do not exceed 20% of the number of hours worked in the work-week by the non-exempt employees under his direction; provided that this subsection (f) shall not apply in the case of an employee who is in sole charge of an independent establishment or a physically separated branch establishment.

The foregoing definition as set forth in the Administrator’s Regulations has the force of law under the provisions of the act and supersedes common understanding and dictionary definitions.

This, court has given careful consideration to the evidence presented on behalf of the parties at the trial of this cause and therefrom has made the following findings:

(1) The work in which the plaintiff, Joseph Eox, was employed was essentially interstate commerce and therefore his wages and hours are regulated by the Eair Labor Standards Act.

(2) The primary duties of the plaintiff in his employment required manual labor, namely, weighing, sorting, and carrying merchandise to and from the loading platform, preparing the same for shipment and distributing shipping slips to various drivers. I find no evidence of “management” of the department in the course of his duties, except the natural leadership resulting from long experience with the job. He might better be classified as a “lead man”'—certainly not as an executive.

(3) The plaintiff did not customarily or regularly direct the work of other employees within the contemplation of the act or the Administrator’s Eegulations.

(4) The plaintiff had no authority to hire or fire other employees. It is also quite doubtful that plaintiff had a greater right than any other employees to Teeommend the hiring, firing or advancement of fellow employees.

(5) The plaintiff did not customarily or regularly exercise any discretionary powers. His work and the work of his associates was primarily one of routine requiring little, if any, discretion on the part of the employees.

(6) The plaintiff did receive as a salary $35 per week, a sum greater than the minimum salary basis established by the Eegulations.

(7) The plaintiff did perform work of tbe same nature as performed by non-exempt employees far in excess of 20% of the number of hours worked in the work-week by nonexempt fellow employees.

From the evidence presented at the trial there can be no question hut that the plaintiff was not employed in a Iona 'fide executive capacity and therefore he was not exempt from the provisions of the act. It is the opinion of this court that the plaintiff is entitled to recover the sum of $164.57 for his overtime pay, an additional sum of $164.57 as liquidated damages provided by the act and a counsel fee in the sum of $75.

Judgment will therefore be entered in favor of the plaintiff, Joseph Fox, and against the defendant, Armour and Company, in the sum of four hundred and four dollars and fourteen cents ($404.14) together with costs of suit.


author: Cozzi, D. C. J.

text:
    Hudson County District Court.
    ATTILIO RICCI, PLAINTIFF, v. HARRY CLAIRE AND IDA CLAIRE, DEFENDANTS.
    Decided August 23, 1943.

      For the plaintiff, James P. McMahon.

    For the defendants, Harber & Preesman.

    For the Administrator of the Office of Price Administration, William E. Sandmeyer.

   Cozzi, D. C. J.

The plaintiff, Attilio Ricci, and the

defendants, Harry Claire and Ida Claire, his wife, entered into a written lease wherein plaintiff rented to the defendants for a term of one year commencing September 1st, 1941, a certain apartment for dwelling purposes, in the City of Union City, Hew Jexsey. The clause in said lease provided that the said premises were demised “for use as a private dwelling for himself and his family.” It’s undisputed that Mrs. Claire’s sister, her husband, and two children, resided in said apartment without the consent of the plaintiff. The plaintiff informed the defendants that a violation existed and insisted that the relatives move. This the defendants did.

On July 1st, 1942, the Maximum Rent Regulation Ho. 28 promulgated pursuant to the Emergency Price Control Act of 1942, enacted by the Congress of the United States on January 30th, 1942, became effective in the Hortheastern Hew Jersey Defense-Rental Area, of which the County of Hudson and State of Hew Jersey is a part, within which area this particular leased apartment is located.

It appears that in July, 1942, the plaintiff instituted dispossess proceedings in this court, against the defendants, predicated upon the violation of the defendants in permitting their relatives to live with them, contrary to the terms of the lease. It is conceded that no notice o£ this action was tiled with the Hortheastern Hew Jersey Defense-Rental Area Office, as prescribed by the rules and regulations concerning eviction of tenants by the landlord. It appears that thereafter the plaintiff and the defendants agreed that the dispossess proceedings be abandoned and that the defendants ■would vacate the premises on the expiration of the lease on August 31st, 1942, as was evidenced by a written notice to that effect, signed by the defendants and addressed to the plaintiff. The defendants failed to remove on August 31st, 1942, stating that they could not find a suitable apartment. The defendants, however, did move, in September, 1942, and offered to the plaintiff the rent for that month, which tender of rent was refused by the plaintiff.

Thereafter, the plaintiff instituted the present suit for double the rent pursuant to the provisions of Revised Statutes of 1937, of the State of New Jersey, 2:58-5; N. J. S. A. 2:58-5, as a penalty, which is in excess of the maximum legal rent as controlled by the Office of Price Administration pursuant to the laws of the United States.

The Administrator of the Office of Price Administration for this area, intervened, and permission was granted for such intervention. Accordingly, the Administrator filed a brief to which the defendants joined and adopted as their own in lieu of a separate brief.

The importance of this case is significant because of the state of war in which the United States is concerned at the present time, and the apparent conflict of laws that now exists with the effective administration of the Emergency Price Control'Act of 1942, 50 U. S. C. A. Appendix, §§ 901 et seq., which, in this ease, particularly involves the question of rents.

The significant question, therefore, is whether or not the Maximum Rent Regulation No. 28 promulgated pursuant to the Emergency Price Control Act of 1942, and raising rents as of March, 1942, has, in effect, superseded the State Law Revised Statutes 2:58-5, upon which statute this suit is now predicated and the plaintiff relies.

A careful perusal and study of the pertinent statutes, provisions of the United States Constitution, rules and regulations promulgated by the Office of Price Administration and the state' statute are necessary, and are therefore quoted at length.

New Jersey Revised Statutes of 1937, 2:58-5; N. J. S. A. 2:58-5, provides:

“If a tenant of real estate shall give notice of his intention to quit the premises by him held at a time specified in such notice and shall not deliver up the possession of sueli real estate at the time specified in the notice, such tenant, his executors or administrators, shall, from such time, pay to 1ns landlord or lessor, his heirs or assigns, double the rent which he should otherwise have paid, to be levied, sued for and recovered at the same time and in the same manner as the single rent before the giving of such notice could be levied, sued for and recovered; and such double rent shall continue to be paid during all the time such tenant shall continue in possession after the giving of such notice.”

Section 205 (d) of the Emergency Price Control Act, 56 Stal. 23 (1942); 50 U. S. C. A. Appendix, §§ 901 et seq., provides:

“No person shall be held liable for damages or penalties in any Federal, State, or Territorial Court, on any grounds for or in respect of anything done or omitted to be done in good faith pursuant to any provision of this Act or any regulation, order, price schedule, requirement, or agreement thereunder, or under any price schedule of the Administrator of the Office of Price Administration or of the Administrator of the Office of Price Administration and Civilian Supply, notwithstanding that subsequently such provision, regulation, order, price schedule, requirement, or agreement may be modified, rescinded, or determined to be invalid.”

Provisions of Maximum Bant Regulation No. 28 Involved.

Section 1 (d) provides:

“An Agreement by the tenant to waive the benefit of any provision of this Maximum Rent Regulation is void. A tenant shall not be entitled by reason of this Maximum Rent Regulation to refuse to pay or to recover any portion of any rents due or paid for use or occupancy prior to the effective date of this Maximum Rent Regulation.”

Section 6 (a) provides:

“So long as the tenant continues to pay the rent to which the landlord is entitled, no tenant shall be removed from any housing accommodations, by action to evict or to recover possession, by exclusion from possession, or otherwise, nor shall any person attempt such removal or exclusion from possession, notwithstanding that such tenant has no lease or that his lease or other rental agreement has expired or otherwise terminated, unless:

“(3) The tenant (i) has violated a substantial obligation of his tenancy, other than an obligation to pay rent, and has continued, or failed to cure, such violation after written notice by the landlord that the violation cease, or (ii) is committing or permitting a nuisance or is using or permitting a use of the housing accommodations for an immoral or illegal purpose.”

Section 6 (d) provides:

“At the time of commencing any action to remove or evict a tenant (except an' action based on non-payment of a rent not in excess of the maximum rent) the landlord shall give written notice thereof to the Area Kent Office stating the title, the number if possible, the court in which it is filed, the name and address of the tenant and the grounds on which eviction is sought.”

Article of the Constitution of the United States Involved.

Article 6, el. 2, provides:

“This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, anything in the Constitution or Laws of any State to the contrary notwithstanding.”

The Emergency Price Control Act, supra, and the rules and regulations promulgated in the furtherance of that act to be administered by the Office of Price Administration, is twofold in scope. Eirst, it was intended to control the eviction of tenants in congested areas, such as defense areas where sudden migration and overflow of defense workers in defense áreas would create a sudden demand for living quarters, and second, to freeze the rents so as to prevent inflation and thus seek to preserve the economic security of a nation during and after the war.

A long line of cases, needless to cite at this time, have established an undeniable right of Congress to enact such legislation as herein quoted, in time of war, to preserve the economic security of our nation as well as to provide for the common defense of our people. Hence it follows, a fortiori, whenever a conflict exists between the state and federal laws pertaining to such legislation, the federal law must take precedence to be enforced to the exclusion of the state law, so far as it is consistent with constitutional sanction. Illustrative of this situation is the recent ease of Helena Rubenstein, Inc., v. Charlene’s Cut Rate, 132 N. J. Eq. 254; 28 Atl. Rep. (2d) 113. The United States Supreme Court, in the case of United States v. MacIntosh, 283 U. S. 605; 51 S. Ct. 570, reiterated at some length, the extent of the broad powers of Congress incidental to its power to declare war.

Congress has spoken, rules and regulations have been promulgated concerning the eviction and the freezing of rents, the enforcement of which obviously conflicts with the enforcement of tlie state statute upon the basis of which the plaintiff herein seeks to recover double rent against the defendant. It is contended by the plaintiff that the prohibition concerning the freezing of rents does not affect the state statute as embraced in R. S. 2:58-5; N. J. S. A. 2:58—5, as the latter, in essence, really creates a penalty as distinguished from rents. To this, it is sufficient to say, that in the time of war, when our national security is paramount, that the courts will construe the acts of Congress and the rules and regulations promulgated in pursuance thereto, to lend enforcement, not only to its expressions, but with equal force, to their implications. In this respect, the court will not permit a landlord to receive pursuant to a state statute what the laws of Congress expressly or impliedly intended to prohibit. Clearly, they were intended to prevent any exaction from the tenant above the rent as frozen or approved by the Price Administration, even though exaction may be classified as a penalty. To hold to the contrary would create a serious evasion of the enforcement of these laws, rules and regulations and prove of great detriment to our national welfare and security.

Furthermore, the plaintiff could not have succeeded in the dispossess proceedings instituted against defendant tenant, in view of the O. P. A. regulations pertaining to evictions, above quoted. The written notice by the tenant to vacate, served upon the plaintiff, under these circumstances, was involuntarily given and it cannot be construed nor effectively constitute' itself a waiver of the 0. P. A. regulations by the tenant. See Maximum Rent Regulation No. 28, § 1 (d) quoted supra.

For the reasons stated, the State Law Eevised Statutes 2:58-5; N. J. S. A. 2:58-5, for the emergency time being, has been superseded by the federal regulations and laws above quoted, and the plaintiff’s suit for double rent, in view of a timely tender of one month’s rent by the defendant tenant, must fail.

Judgment will be entered for the defendants.