author: Kolovsky, J. A. D.

text:
    CLAIROL, INCORPORATED, A DELAWARE CORPORATION, PETITIONER-APPELLANT, v. WILLIAM KINGSLEY, ACTING DIRECTOR OF DIVISION OF TAX APPEALS, RESPONDENT-RESPONDENT.
    Superior Court of New Jersey Appellate Division
    Argued September 23, 1969
    Decided February 16, 1970.

      Before Judges Costeoed, Collester and Kolovsky.

      Mr. Roger G. Ward argued the cause for appellant (Messrs. Pitney, Hardin & Kipp, attorneys).

      Mr. Charles H. Landesman, Deputy Attorney General, argued the cause for respondent (Mr. Arthur J. Sills, Attorney General, attorney; Mr. Stephen Skillman, Deputy Attorney General, of counsel).
   The opinion of the court was delivered by

Kolovsky, J. A. D.

Clairol, Incorporated, is a Delaware corporation which has not qualified to do business in Hew Jersey. It appealed to the Division of Tax Appeals from the denial by the Director of the Division of Taxation of Clairol’s claims for refund of the following taxes (besides interest) paid under protest for the years 1959 to 1963 inclusive:

1959 ............................................... $ 1244.24'

1960 ............................................... 1600.08

1961 ............................................... 1673.55

1962 ............................................... 2150.75

1963 ............................................... 2811.49

The denial was bottomed on a determination by the Director that the “nature, extent and scope” of Clairol’s activities in Hew Jersey were sufficient to “create a taxable status pursuant to the Hew Jersey Corporation Business Tax Act (N. J. S. A. 54:10A—1 et seq.).”

At the hearing before the Division, held in the latter part of 1967, Clairol sought to challenge not only the taxes for the years 1959 through 1963 but also those for the years 1964 to 1966, inclusive. The Director ruled that it had no jurisdiction to deal with the latter three years since Clairol had not filed a petition of appeal with respect to those years.

The Division affirmed the Director’s determination with respect to the earlier five years, its opinion embodying findings of fact and conclusions of law on the basis of which it upheld the propriety of the tax levies. The appeal to this court followed.

Clairol did not in the Division, and does not here, challenge the amounts of the taxes it has been required to pay nor the fairness of the statutory allocation formulae used in computing them. Rather, it argues that its activities in Hew Jersey are such that levy of a corporation business tax on it is not authorized by the Hew Jersey statute and indeed is prohibited both by the Federal Constitution and by a federal statute. In addition, it argues that the Division erred in refusing to consider its challenge of the taxes for the years 1964 through 1966, contending that “the tax years 1964 through 1966, in addition to the tax years 1959 through 1963 [were] properly before the Division and are ripe for decision in these proceedings.”

There is no substance in the latter contention. The Division lacked jurisdiction to review the decisions of the Director of Taxation with respect to the years 1964 through 1966 because Clairol had not filed petitions of appeal from such decisions, a statutory prerequisite to the acquisition of jurisdiction by the Division. See N. J. S. A. 54:10A-19.2; Newark v. Fischer, 3 N. J. 488, 493 (1950). The three months limited by the cited statute for taking such an appeal had long since expired as far as the Director’s rulings with respect to the years 1964 and 1965 were concerned. As for the year 1966, the time for appeal had not yet begun to run, the Director not having made a ruling with respect to Clairol’s refund claim for that year.

Clairol’s principal argument is that the nature and scope of its activities in New Jersey are so limited and insubstantial that this State may not constitutionally impose the corporate business tax upon it.

However, our examination of the record satisfies us that the evidence fully supports the Division’s findings and conclusions to the contrary. The virtually uncontradicted evidence summarized in the Division’s opinion establishes that Clairol exercises its corporate franchise in this State, owns and employs property in this State and maintains offices in this State to such an extent that “it can realistically be said that state government substantially affords protection and gives benefits to the corporation’s enterprise within the state.” Roadway Express Inc. v. Director, Division of Taxation, 50 N. J. 471, 483 (1967), appeal dismissed for want of a substantial federal question, 390 U. S. 745, 88 S. Ct. 1443, 20 L. Ed. 2d 276 (1968). In such circumstances the tax levied on Clairol is not subject to any constitutional infirmity.

It is of no constitutional significance that Clairol’s activities and property ownerships in Hew Jersey are substantially less than those of the taxpayers in Roadway Express, supra j they are sufBciently extensive to afford a constitutional basis for holding Clairol subject to the provisions of the Corporation Business Tax Act.

• There is no claim that the tax imposed on Clairol is either discriminatory or not fairly apportioned. That being so, it is to be deemed valid as “a fairly apportioned, non-diseriminatory means of requiring * * * [Clairol] to pay its just share of the cost of state government upon which it necessarily relies and by which it is furnished protection and benefit.”' Roadway Express, 50 N. J., at 491.

Clairol also contends that “P. L. 86-272, 15 U. S. C. A. § 381 et seq., expressly invalidates the net income portion of the tax and inferentially invalidates the net worth with portion of the tax.”

Use of the words “net income” and “net worth portions of the tax” is a shorthand reference to the fact that pursuant to N. J. S. A. 54:10A-5, the measure of the tax levied against Clairol was the total of the tax computed on the basis of its allocated net worth and that computed on the basis of its allocated net income. Eor an explanation of the computation of the tax under the act, see Roadway Express, supra, at 476-477.

The computations for the years 1959 through 1963 are:

Tear Tax based on Net Worth Tax based on Net Income Total Tax

1959 464.86 779.38 1244.24

1960 452.11 1147.97 1600.08

1961 445.06 1228.49 1673.55

1962 476.17 1674.58 2150.75

1963 625.64 2185.85 2811.49

15 U. S. C. A., §§ 381 and 383, provide in pertinent part as follows:

§ 381.
(a) No State, or political subdivision thereof, shall have power to impose, for any taxable year ending after September 14, 1959, a net income tax on the income derived within such State by any person from interstate commerce if the only business activities within such State by or on behalf of such person during such taxable year are either, or both, of the following:
(1) the solicitation of orders by such person, or his representative, in such State for sales or tangible personal property, which orders are sent outside the State for approval or rejection, and, if approved, are filled by shipment or delivered from a point outside the State; and
(2) the solicitation of orders by such person, or his representative, in such State in the name of or for the benefit of a prospective customer of such person, if orders by such customer to such person to enable such customer to fill orders resulting from such solicitation are orders described in paragraph (1).
*#$*$$#*
(c) For purposes of subsection (a) of this section, a person shall not be considered to have engaged in business activities within a State during any taxable year merely by reason of sales in such State, or the solicitation of orders for sales in such State, of tangible personal property on behalf of such person by one or more independent contractors, or by reason of the maintenance, of an office in such State by one or more independent contractors whose activities on behalf of such person in such State consist solely of making sales, or soliciting orders for sales, of tangible personal property.
Definitions
(d) For purposes of this section —
(1) the term “independent contractor” means a commission agent, broker, or other independent contractor who is engaged in selling, or soliciting orders for the sale of, tangible personal property for more than one principal and who holds himself out as such in the regular course of his business activities; and
(2) the term “representative” does not include an independent contractor. § 383.
For purposes of this chapter, the term “net income tax” means any tax imposed on, or measured by, net income. Pub. L. 86-272, Title I, § 103, Sept. 14, 1959, 73 Stat. 556.

The federal act was passed in response to the decision of the United States Supreme Court in Northwestern States Portland Cement Co. v. Minnesota, 358 U. S. 450, 79 S. Ct. 357, 3 L. Ed. 421 (1959), upholding the validity of Minnesota’s direct income tax as applied to a foreign corporation whose salesmen solicited orders for cement in that State, with the orders being accepted in and the cement shipped from Iowa. See Eli Lilly and Company v. Sav-on-Drugs, Inc., 366 U. S. 276, 286, 81 S. Ct. 1316, 1322, 6 L. Ed. 2d 288 (1961).

As noted in Roadway Express,

Shortly after the decision in Northwestern Cement, Congress passed P. L. 86-272 (1959), 73 Stat. 555, 15 U. S. C. A. § 381, et seq., denying the states the power to impose taxes on or measured by net income derived within the state from interstate commerce, if the only business activities carried on within the state are the solicitation of orders for sales of tangible personal property and the orders are sent outside the state for approval or rejection and are filled by shipment or delivery from a point outside the state. This very limited prohibition c bviously does not apply to the taxpayers in the case at bar. The legislative approach being negative and not positive, we believe no inference may be drawn therefrom as to the power of the states to otherwise tax interstate commerce. This appears to be the view expressed in the report of the Senate Committee handling the legislation. U. S. Code Congressional and Administrative News, 86th Congress, First Session (1959) 2548, 2551. [50 N. J., at 490, No. 3; emphasis added]

There is no substance in ClairoPs contention that the statute “inferentially invalidates the net worth portion of the tax.” The federal act by its terms applies only to taxes on or measured by net income. "Whatever may be the effect of the act on the portion of ClairoPs tax measured by allocated net income, it has no effect on the portion thereof measured by allocated net worth.

Whether the federal act does invalidate the portion of the tax measured by allocated net income depends on- whether Clairol's “only business activities within [the] State” are those described in § 381(a), the solicitation of orders. See Herff Jones Company v. Stats Tax. Comm., 247 Or. 404, 430 P. 2d 998, 1001 (Sup. Ct. 1967):

Therefore, it seems clear that in order to come within the purview of P. L. 86-272 the only business activity which plaintiff’s sales representatives could engage in is the solicitation of orders.

Implicit in the Division’s determination that the federal statute “does not apply here” is the finding that ClairoPs representatives in New Jersey do more than this: their activities are not limited to the solicitation of orders. That conclusion is supported by the record.

The primary function of Clairol’s detailmen and other representatives in Few Jersey is to promote the public’s purchase and use of its products. To accomplish that purpose, its salaried cosmetics detailmen assigned to visit retail druggists do so at regular intervals. One of a detailman’s duties is to review the display of Clairol products and, as explained by one of them called as a witness by Clairol,

lie may rearrange a promotion to where it looks the best for moving out the merchandise, or he may make up a little display on the counter for [the druggist.! with the merchandise that is already present there.

The detailman also carries with him in his auto — furnished by the company and garaged in Few Jersey where the detailmen live — promotion materials, various business forms, and in addition a supply of samples with a total value of about $135 which, according to the testimony of the detailman, is

used mostly for public relations, more or less. If you see a cosmetician doing a good job with your product, you generally try to give her something in reference to a compact or lipstick, and so forth.

In addition, if the retail store buyer grants permission, the detailman will take an inventory of the store’s stock of Clairol products. “He shows the inventory to the buyer and from this inventory he writes up a suggestive order. Then the buyer will either phone in his wholesaler or will allow the representative to mail it to the wholesaler.”

Clairol also has representatives who call on beauty salons that purchase Clairol products from “beauty jobbers,” “salon wholesalers” to whom Clairol sells. Clairol’s comptroller described the activities of its representatives who visit beauty salons thusly:

[T]he detail people who call on the beauty salons have a technical background and they do very little as far as order taking. In other words, their big function is going into the local beauty salon to tell them how to use Olairol products. Or they may ask, “Have you had any problem with new Clairol product X? What has been your experience with it?” And maybe in teaching them new techniques, possibly. These people have a technical background, whereas the people calling on drugstores do not have a technical background. In other words, if someone asks them, “I did this and this to my hair,” he wouldn’t have the slightest idea.
Q. Now, these people do not work for Olairol, do they? A- That’s right. They work for technical centers and they are referred to as technicians.

It is thus evident that Clairol’s business activities in New Jersey extend beyond the mere solicitation of orders either on its own behalf or on behalf of its wholesalers.

That increased public favor of Clairol’s products will eventually result in increased orders from retail druggists to wholesalers and from wholesalers to Clairol, or as in the case of its hair products from beauty salons to “beauty jobbers” and from the latter to Clairol, does not blanket all Clairol’s activities with the protection afforded by the federal act to cases where the only business activity of the taxpayer is the solicitation of orders.

We are not persuaded to a contrary conclusion by the out-of-state cases cited by Clairol in support of its argument that the words “solicitation of orders” should be interpreted to encompass all of its activities in New Jersey.

Only Smith Kline & French Laboratories v. State Tax Comm., 241 Or. 50, 403 P. 2d 375 (Sup. Ct. 1965), and State ex rel. Ciba Pharmaceutical Products Inc. v. State Tax Comm., 382 S. W. 2d 645 (Mo. Sup. Ct. 1964), lend any support to the argument. The broad interpretation of the word “solicitation” in the Smith Kline case has since been substantially narrowed, if not' altogether repudiated, by later decisions of the Oregon Supreme Court. See Herff Jones Company v. State Tax Comm., 247 Or. 407, 430 P. 2d 998, 1001 (Sup. Ct. 1967).

The other two cases cited by Clairol — International Shoe Company v. Cocreham, 246 La. 244, 164 So. 2d 314 (Sup. Ct. 1964), cert. den. Mouton v. International Shoe Co., 379 U. S. 902 (1965), and Ohlahoma Tax Comm. v. Brown-Forman Distill. Corp., 420 P. 2d 894 (Sup. Ct. Okla. 1966) — are of no relevance to the issue before us. Each involved only an unsuccessful attempt by the state taxing authorities to have the Eederal statute adjudged unconstitutional.

The judgment of the Division of Tax Appeals dismissing the appeals of the petitioner for the years 1959 to 1963, inclusive, is affirmed.


source: Caselaw Access Project

author: Conford, P. J. A. D.

license: Public Domain

text:
    MARIA JASTREMSKI, GENERAL ADMINISTRATRIX AND ADMINISTRATRIX AD PROSEQUENDUM OF THE ESTATE OF MYRON JASTREMSKI, DECEASED, JOHN JASTREMSKI, AN INFANT BY HIS GUARDIAN AD LITEM, MARIA JASTREMSKI AND MARIA JASTREMSKI, INDIVIDUALLY, PLAINTIFF-RESPONDENTS, v. GENERAL MOTORS CORPORATION, A CORPORATION OF THE STATE OF DELAWARE, DEFENDANT-APPELLANT.
    Superior Court of New Jersey Appellate Division
    Argued January 5, 1970
    Decided February 13, 1970.

      Before Judges Coneord, Collester and Kolovsicy.

      Mr. Joseph V. Qullum argued the cause for appellant (Mr. Boss L. Malone, attorney, of counsel).

      Mr. Stanley W. Greenfield argued the cause lor respondents (Messrs. Sheviclc and Sheviclc, attorneys).
   The opinion of the court was delivered by

Conford, P. J. A. D.

Defendant General Motors Corporation appeals from a judgment in favor of plaintiffs in the aggregate sum of $149,550 for damages for personal injuries and wrongful death attributed by them to an alleged defect in the steering wheel assembly of an automobile manufactured by defendant which overturned while being driven by the decedent Myron Jastremski on the New York Thruway in the early morning of July 18, 1964. The family had left Jersey City on a vacation trip to Canada late in the evening of July 17, several hours before. Decedent’s wife and son were passengers in the car and sustained relatively slight injuries. His own injuries rendered him a quadriplegic, and he died in March 1965.

The factual theory of the defense was that there was no defect in the car when it left the manufacturer’s plant but that the decedent lost control of the vehicle either through excessive speed in light of the alleged condition of the roadway, weariness because of lack of sleep, or driver-error when he inadvertently took an exit ramp and then tried to steer back onto the highway.

The vehicle had been purchased new on May 8, 1964 and the odometer read 2,051 miles at the time of the accident. There was evidence that the car was in good condition prior to the accident. It had had routine servicing by the dealer the day the trip began.

Plaintiffs’ case for the existence of a manufacturing defect in the vehicle rested on the testimony of one Jesse Fisher, who qualified as an expert on automobile mechanics, being a licensed teacher of automobile mechanics. After the accident he examined the steering mechanism of the vehicle where connected to the left front wheel. He found that one of the three rivets in the left front upper suspension ball stud socket was broken. He concluded the rivet had been broken for some time before the accident because the broken ends were polished, indicating friction when the ends rubbed together upon road vibration. He attributed the break in the rivet to looseness in its original installation. The rivet break •over a period of time caused enlargement of the socket opening, eventually causing the ball stud to slip out. When this happened the left front wheel folded under, and the rapidly moving car was wrenched from the driver’s control and overturned. Defendant submitted expert testimony purporting to refute that of Eisher as to the explanation of the break in the rivet and to negate any possibility of the ball stud passing from the socket prior to the accident. Its theory was that the break in the rivet occurred as a result of the accident rather than vice versa.

I.

Defendant urges error in the court’s admission, over objection, of testimony by the witness Fill, decedent’s brother-in-law, of a statement allegedly made to him by decedent at the hospital 22 hours after the accident. The testimony was first taken out of the presence of the jury for a preliminary determination by the trial judge as to competency under Evidence Rule 63(32), which reads:

Subject to Rule 64, in a civil proceeding, a statement made by a person unavailable as a witness because of his death is admissible if the statement was made in good faith, upon the personal knowledge of the declarant, and there is a probability from the circumstances that the statement is trustworthy.

The testimony in question was:

A. I asked Myron [decedent] what happened.
Q. AVhat did he say?
A. I was going to Canada and the car started to shake and it turned over.
íjt sjí * •-!; * ‘ *
A. He says the wheel shook and the front end dropped down to the ground and she turned over.

Plaintiff Maria Jastremski later testified to essentially the same version of the occurrence of the accident.

On the voir dire of the witness Fill defendant did not proffer any witnesses but confined its showing in opposition to the admissibility of the testimony to cross-examination of Eill and to an argument that it was unfair to allow the statement in evidence when there had been a period of eight months of survival during which the decedent’s live testimony as to the happening of the accident could have been taken or perpetuated, and no such action was taken.

The court ruled in favor of the admissibility of the statement. It stated:

I have heard this testimony. I find nothing by way of what I heard or been argued to make me feel that there isn’t a complete atmosphere of reliability in this case.
I’m satisfied that under this Hule, that number 1, it is admitted that the person who made the statement is now dead.—I hold, as a matter of fact, from the evidence that I have heard that it was made in good faith upon the personal knowledge of the declarant and there is a probability, a reasonable probability from the circumstances that the statement is trustworthy. I do not judge its credibility. That is for the jury to determine.

Defendant now contends for the first time that the admission of the statement is invalidated by tbe failure of the trial court to comply with the direction in Evidence Rule 8, dealing with preliminary inquiries, inter alia, into competency of evidence depending upon conditions, that the judge inform the parties which one has the burden of producing evidence and which the burden of proof. Defendant also complains it should have been informed by the court it could call witnesses on the conditions of competency fixed by Evidence Rule 63(32), but it does not suggest what witnesses it would or could have called on any issue relevant to such conditions. Reiteration is also made of the objection offered at trial that plaintiff should have deposed decedent or perpetuated his testimony while be was alive. (He died before the action was instituted.)

We find no merit in any of the arguments advanced. We find no prejudice in the trial court’s omission to indicate on the voir dire which party had the burden of coming forward with evidence and which the burden of proof. Here the plaintiffs assumed the initial burden and met the second to the satisfaction of the judge. Defendant could properly have been assumed by the trial court to be familiar with the rules and to know that under them it was privileged to adduce evidence relative to the nonexistence of any of the conditions of competency of the decedent’s statement. None having been offered, it was incumbent upon the court to rule on plaintiff’s showing alone.

Evidence Rule 63(32) is a salutary broadening of the means for determination of the truth in civil cases. See McCormick on Evidence (1954), §§ 302, 303, at 628-630; Robertson v. Hackensack Trust Co., 1 N. J. 304, 315-324 (1949) (Vanderbilt, C. J., concurring). While the breadth of the rule is such that it is susceptible of abuse if it is carelessly administered by the trial judge, we can find no fault on the record before us with the trial adjudication in this particular instance. The trial judge could well have ruled the other way, having in mind the witness Fill’s obvious interest in the outcome of the case, but much necessarily depended on his peculiar capacity to appraise the demeanor of the witnesses and the flavor of the surrounding circumstances — a capacity we do not possess in the same degree. There was no error.

The admissibility of a statement under the rule does not depend upon whether the proponent party could have deposed or perpetuated the testimony of the declarant during his lifetime.

II

Two other evidence rulings are assailed by defendant. One was the court’s allowance of rebuttal testimony on behalf of plaintiff by Fill to the effect that he was able with a wrench to pull a ball stud out of a socket assembly purported to correspond to the one here involved. This was intended to refute a statement on cross-examination by defendant’s expert Pickering, elicited over objection, that he would not be able to extract the stud with that size wrench. But later in the cross-examination he admitted it could be done. We think both the cross-examination and rebuttal were of doubtful propriety. The condition of a man pulling a stud out of a socket with a wrench does not appear comparable to the conditions attending the actual event here involved — the alleged forcing of a stud out of a socket by the stress involved in the operation of the moving car and because of the broken condition of the rivet. The conditions and circumstances not having been similar, the pertinence of both the cross-examination and rebuttal were questionable, particularly the latter, since the witness did ultimately admit the ball stud could be pulled from the model assembly with the wrench. However, we fail to discern such prejudice to defendant in the entire episode as would warrant reversal.

We find no merit in defendant’s objection io the showing of the film of the decedent in the hospital. This matter lay well within the trial court’s discretion.

Ill

Failure of the trial court to instruct the jury that it should deny recovery if it found that plaintiff’s contributory negligence caused or contributed to the accident is submitted as a ground of appeal. The trial court assigned an incorrect reason for denying the requested charge when it stated that if the alleged defect was a cause concurring with decedent’s excessive driving speed to produce the accident, defendant would still be liable. This is not a correct statement of the law. Maiorino v. Weco Products Co., 45 N. J. 570, 574 (1965).

However, we conclude the resulting denial of a charge on contributory negligence was not prejudicial error because we find nothing beyond conjecture, on the proofs as a whole, to support a finding of contributory negligence by decedent causally eontributive to the accident. There is no evidence concerning the actual speed at which the car was proceeding or that it exceeded the limits permitted for New York Thruway travel. Contrary to defendant’s assertion, the proofs do not indicate any constructional defects in the roadway pertinent to safe speed at the point of the accident. There was merely new paving of the roadway. Finally, the fact that the car came to rest alongside an exit ramp does not support, in reasonable probability, defendant’s tendered hypothesis that decedent had taken the exit ramp by mistake and negligently sought to turn back to the highway, resulting in the overturning of the vehicle. The location at which the car came to rest could well be consistent with the theory of the erratic tumbling of the car because of operational aberration (due to the defect) which began on the roadway proper before the vehicle arrived at the point of divergence of the exit ramp from the roadway.

Defendant cites Vespe v. DiMarco, 43 N. J. 430 (1964), on this point. We find it not pertinent. That ease held that res ipsa loquitur applied to the situation of a car skidding on snow and ice. In the present case, where there is the competing explanatory hypothesis of manufacturing defect, supported by evidence, one cannot say from all the circumstances that the accident in common experience bespeaks negligence by plaintiff.

Certain other objections are posed with respect to the court’s charge to the jury, but we find no ground for disturbance of the jrrdgment in any such reason.

IY

Defendant urges that plaintiff’s proofs lack the probative force to create a jury issue on the contentions that there was a defect in the steering mechanism when the vehicle left its factory and that any such defect was causally eontributive to the accident. It consequently contends there was error in denying its motions for involuntary dismissal or at least in failing to grant the motion for a new trial. We have carefully perused the record and, without here detailing all the proofs, are satisfied that the issues of liability were properly submitted to the jury and the motion for a new trial correctly denied.

Judgment affirmed.


author: Sullivan, P. J. A. D.

text:
    LEO CENNO, PLAINTIFF, v. WEST VIRGINIA PAPER & PULP CO., ET AL., DEFENDANTS, AND WEST VIRGINIA PAPER & PULP CO., AND ACME STEEL COMPANY, THIRD-PARTY PLAINTIFFS-RESPONDENTS, v. AMERICAN POLICYHOLDERS INSURANCE COMPANY, AMERICAN MUTUAL LIABILITY INSURANCE COMPANY, THIRD-PARTY DEFENDANTS-APPELLANTS.
    Superior Court of New Jersey Appellate Division
    Argued February 2, 1970
    Decided February 20, 1970.

      Before Judges Sullivan, Carton and Halpern.

      Mr. Arthur J. Callaghan argued the cause for appellant American Mutual Liability Insurance Company (Messrs. Brause, Callaghan <& Coyle, attorneys).

      Mr. Herbert Ziff argued the cause for respondent Acme Steel Company (Messrs. Ziff & Yacavino, attorneys).

      Mr. Maurice B. McLaughlin argued the cause for respondent West Virginia Paper & Pulp Co. (Messrs. Galvin, French <& McLaughlin, attorneys).
   The opinion of the court was delivered by

Sullivan, P. J. A. D.

This appeal is from a judgment of the trial court holding that plaintiff’s accident, for which defendant West Virginia Paper and Pulp Company was ultimately held liable, came within the loading and unloading provisions of a comprehensive automobile liability policy issued by appellant American Mutual Liability Insurance Company. Por reasons hereinafter detailed we reverse.

Plaintiff Leo Cenno was employed as a truck driver by Ahrens Motor Trucking. Ahrens was insured in its trucking operation by American Mutual under the aforesaid policy, which contained the following provisions relevant to the legal issue herein involved.

I. COVERAGE A — Bodily Injury Liability to pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of bodily injury * s" * caused by accident and arising out of the ownership, maintenance or use of any automobiles.

* * * * * * =•>

III. DEFINITION OF INSURED

The unqualified word “insured” includes the named insured and also includes any person while using an owned automobile or a hired automobile and any person or organization legally responsible for the use thereof, provided the actual use of the automobile is by the named insured or with his permission, * * *.

IV. PURPOSES OE USE DEFINED

(e) Use of an automobile includes the loading and unloading thereof.

On the day in question plaintiff, driving an Ahrens’ truck, picked up a truckload of 500-150-pound bales of cardboard boxes at the West Virginia Paper and Pulp Company plant in Hoboken, New Jersey. He was to deliver the load to Allied Paper in Brooklyn, New York. The cardboard had been baled by West Virginia at its Hoboken plant using metal bands and clips manufactured by defendant Acme Steel Company.

Plaintiff arrived at the Allied Paper plant in Brooklyn and, in connection with the unloading, attempted to move one of the bales to the rear of the truck. An Allied Paper employee was standing by with a fork lift to take the bale. While plaintiff was pulling on a band securing the bale, the band came apart causing plaintiff to lose his balance and fall out of the truck to the ground.

Plaintiff brought suit against Acme Steel charging that the bands and clips used on the bale had been defectively manufactured. He also sued West Virginia charging that the bale had been negligently and improperly banded. Acme Steel and West Virginia called upon American Mutual to defend them as additional insureds under the comprehen•sive liability policy covering the truck. American Mutual refused to do so and third-party complaints were filed by Acme and West Virginia against American Mutual charging that the accident happened during the unloading, came under the loading and unloading clause of the truck liability policy, and-that they were additional insureds covered by said policy. The third-party suits were severed and plaintiff’s accident suit tried separately.

The issue of liability in the accident suit was submitted to a jury, which returned a verdict in favor of plaintiff and against West Virginia for $12,000. The jury found no cause for action on plaintiff’s claim against Acme Steel.

Thereafter, the trial judge ruled that the accident happened during the unloading of the truck and that Acme and West Virginia were additional insureds under American Mutual’s liability policy. He therefore entered a judgment on the third-party complaints in favor of West Virginia and against American Mutual for $12,000, plus costs of $1,585 representing its expenses in defending plaintiff’s suit. He entered a judgment in favor of Acme against American Mutual for $1,635 representing its costs incurred in defending plaintiff’s suit. The appeal by American Mutual involves only the rulings in the third-party suits.

We conclude that the decision of the trial court, holding that Acme Steel and West Virginia were additional insureds under the comprehensive automobile liability policy for the negligent acts charged to them, was erroneous. Plaintiff’s suit against Acme Steel was bottomed on the contention that the steel bands and clips used on the bale had been defectively manufactured. (The Acme Steel plant is located at Rockford, Illinois.) Plaintiff’s complaint against West Virginia charged that it had negligently banded the bale. (The baling was done by West Virginia at its Hobo-ken, Hew Jersey, plant.) The jury, by its verdict, found that the accident had been caused by West Virginia in negligently banding the cardboard. However, the acts charged to defendants antedated delivery of the goods to Ahrens Motor Trucking, were unrelated to the loading or unloading of the truck, and were not covered by the comprehensive liability policy. The policy does not embrace all accidents happening during the loading or unloading of the truck regardless of causation. Cosmopolitan Mut. Ins. Co. v. Baltimore & Ohio R. Co., 18 A. D. 2d 460, 240 N. Y. S. 2d, 88, 91 (App. Div. 1963). See Atlantic Mut. Ins. Co. v. Richards, 100 N. J. Super. 180 (Ch. Div. 1968), aff’d 105 N. J. Super. 48 (App. Div. 1969). The policy affords coverage as an additional insured to one while using the vehicle and specifies that “(e) use of an automobile includes the loading and unloading thereof.” Therefore, the pertinent inquiry is whether the acts of negligence charged to defendants were a part of the overall loading or unloading operation so that, in the commission of the negligent acts charged, defendants can be said to have been using the vehicle and thereby became additional insureds under the policy. In other words, did the negligent act which caused the injury or is alleged to have caused it constitute a part of the loading or unloading process? The answer is clearly in the negative. Cases so holding are Moore-McCormack Lines, Inc. v. Maryland Casualty Co., 181 F. Supp. 854 (S. D. N. Y. 1959); Eastern Chemicals Inc. v. Continental Casualty Co., 23 Misc. 2d 1024, 199 N. Y. S. 2d 48 (Sup. Ct. 1960); Bouleris v. Cherry-Burrell Corp., 45 Misc. 2d 318, 256 N. Y. S. 2d 537 (Sup. Ct. 1964). See also 7 Appleman, Insurance Law and Practice, § 4322, at 155; Annotation, “Risks within ‘loading and unloading’ clause of motor vehicle liability insurance policy,” 95 A. L. R. 2d 1122, 1151-1152 (1964).

In Moore-McCormack, supra, a workman loading bags of naphthalene on a truck was injured while handling one of the bags. He sued the consignor, charging that the bags had been negligently exposed to salt water, sun and other natural elements, and as a result they could not be safely handled. The consignor settled the suit for $23,000 and then sued the liability insurance carrier on the truck, claiming the accident came under the loading and unloading clause of the policy. It was held that the negligence was unrelated to the loading and unloading operation and that plaintiff was not an insured under the liability policy.

In Eastern Chemicals, supra, a driver engaged in unloading a truck was injured when a container on the truck exploded. It was held that the charge of negligence asserted against Eastern Chemicals, the owner of the container, “allowing the shipment of an inherently dangerous product without adequate safeguards,” was unrelated to the unloading operation, and that Eastern Chemicals could not claim coverage as an additional insured under the truck liability policy. Bouleris, supra, held that negligently crating a piece of machinery is not a “loading or unloading” operation per se within a motor vehicle liability policy, although it may not result in an accident until loading is attempted.

In interpreting the “loading and unloading” provision of automobile liability "policies, New Jersey has followed the modern “complete operation” doctrine which covers the entire process involved in the movement of the goods, from the moment they are given into the insured’s possession until they are turned over at the place of destination to the party to whom delivery is to be made, so that any occurrence during and arising out of the process of unloading is covered. For all practical purposes, any distinction between “unloading” and “delivery” and between “loading” and “preparatory actions” is not considered. 12 Couch on Insurance 2d, § 45:128, at 191-198 (1964). In applying this doctrine the proper approach is to ascertain whether the acts alleged to have caused the accident were, within reason, causally connected with the complete operation of loading or unloading. Drew Chem. Corp. v. Amer. Fore Loyally Group, 90 N. J. Super. 582, 591 (App Div. 1966). Here the negligent acts charged to Acme Steel and West Virginia antedated delivery of the goods to the insured trucker and cannot reasonably be said to be causally connected with the loading and unloading in any way.

In summary, we conclude that unless the alleged negligent act which is alleged to have caused the accident was an integral part of the overall loading or unloading operation, so that the mishap is causally connected with such loading and unloading and did not merely occur during it, the person charged with the negligent act is not considered to have been using the vehicle so as to be covered by the vehicle’s liability policy for such act as an additional assured. Couch, supra, § 45:136, at 204.

Eeversed and remanded for entry of judgments in favor of defendant American Mutual on the third-party complaints.


author: Per Curiam.

text:
    ESSEX COUNTY WELFARE BOARD, A CORPORATE ENTITY OF THE STATE OF NEW JERSEY, PLAINTIFF-APPELLANT, v. DORIS PHILPOTT, WILLIAM WILKES and FIDELITY UNION TRUST COMPANY, DEFENDANTS-RESPONDENTS.
    Superior Court of New Jersey Appellate Division
    Argued November 24, 1969
    Decided February 24, 1970.
    Before Judges Kilkenny, Labrecque and Leonard.

      Mr. Ronald Reichstein argued the cause for appellant (Mr. John A. Matthews, Jr., attorney).

      Mr. Althear A. Lester of Newark Legal Services Project argued the cause for respondents.

      Miss Annamay T. Sheppard of New Jersey State Office of Poverty and the Law filed a brief as amicus curiae.

   Per Curiam.

The judgment is affirmed essentially for the reasons expressed by Judge Larner in his opinion, reported in 104 N. J. Super 280 (Cty. Ct. 1969).

We requested at oral argument supplemental information as to the period of time embraced by the Social Security check of $1864.20 received on August 20, 1968 “as a retroactive award” for disability benefits. For completeness of the record, we wanted to ascertain whether the benefits were received for the same period defendant Wilkes was receiving financial assistance from the Essex County Welfare Board. We have only now been supplied with the requested information.

Defendant Wilkes applied to the Essex County Welfare Board for assistance on August 2, 1966; received an initial grant of $108 in February 1967, which covered January 1967, and regular monthly payments of $108 from February 1967 through July 1968, for a total of $2082 up to the time of the commencement of these proceedings. He still was receiving public assistance funds from plaintiff, when it filed its brief herein.

Wilkes received a check in the sum of $1864.20, dated August 20, 1968, from the Social Security Administration. It was a retroactive award and represented monthly social security disability insurance benefits paid to him for the months of May 1966 and then from July 1966 through July 1968. Beginning with the May 1966 payment, his monthly benefit was $69.60 and was increased to $78.70 effective February 1968. The $1864.20 check was deposited in Fidelity Union Trust Company in the name of defendant Doris Philpott. Concededly, she holds the account in trust for Wilkes.

Thus, the records show that Wilkes received funds from both sources — Welfare Board and Social Security — covering the period from January 1, 1967 through July 1968. However, he did not receive monthly checks from both agencies at the same time, albeit the retroactive award did in some measure cover the same period.

Notwithstanding the foregoing additional facts, we conclude that the immunity from attachment, execution and levy of Social Security benefits paid or payable, provided for under 42 U. S. C. § 407, immunized from seizure by the Essex County Welfare Board the lump sum benefits received by Wilkes from the Social Security Administration. The reimbursement agreement signed by Wilkes has the force of a judgment, N. J. S. A. 44:7-14; but enforcement of that judgment by the Welfare Board is subject to the same limitations expressed in the paramount Federal Law, 42 U. S. C. § 407, as in the case of any other general judgment.

Affirmed.


text:
    EDWARD FISCHER (AND FIVE OTHERS), PLAINTIFFS-RESPONDENTS, v. THE MAYOR AND COUNCIL OF THE TOWNSHIP OF BRICK, ETC., ET AL., DEFENDANTS, AND THE TOWNSHIP OF BRICK HOUSING AUTHORITY, ETC., DEFENDANT-APPELLANT.
    Superior Court of New Jersey Appellate Division
    Argued January 20, 1970
    Decided February 26, 1970.

      Before Judges Confoed, Collestbr and Koeovskt.

      Mr. Charles F. Starkey argued the cause for appellant (Messrs. Karmen> Starkey, Turnbach & White, attorneys).

      Mr. Alan J. Cornblatt argued the cause for respondents (Mesrss. Mime, Nowels, Turnen, Fundler, Cornblatt & Magee, attorneys).
   The opinion of the court was delivered by

Conford, P. J. A. D.

On June 20, 1968, after a public hearing, the governing body of the Township of Brick adopted two resolutions. By one of these it reversed the refusal of the planning board to approve an application of the housing authority of the township for subdivision of a 17-acre tract of land so that the authority could build a high-rise “senior citizens” residential project on 5.39 acres thereof which it had contracted to purchase for that purpose. By the other, it purportedly amended the zoning ordinance to permit the construction of the building as against existing zoning prohibition of erection of residential structures anywhere in the municipality exceeding 35 feet in height.

The latter action was taken to implement a “Cooperation Agreement” entered into between the housing authority and the governing body in June 1967 under and pursuant to the Housing Co-operation Law, N. J. S. A. 55:14B-1 et seq., to effectuate the establishment of the senior citizens project aforementioned. In 1966 the governing body had approved the site selected for the project, reversing an original denial of approval of the site by the planning board.

The present appeal is from a determination by the Law Division invalidating the resolutions of June 20, 1968 on a complaint by neighboring owners of one-family dwellings that the stated actions of the governing body were illegal in that they violated in various respects the statutes concerning zoning and planning. The basic grievance of plaintiffs, asserted below and before this court, is the supposed discordance of a nine-story apartment building with the character of the residential neighborhood in which they live. It is to be noted, however, that the tract is on Chambers Bridge Boad, both sides of which to a depth of 100 feet are strip-zoned for business. The rear of the tract is in an B—7.5 zone permitting single-family residences, churches and professional offices.

The decision of the Law Division judge was based on the following reasoning: (1) The Housing Co-operation Law does not permit the governing body to “run roughshod” over a master plan once the planning board after a hearing finds that a particular project will “prove detrimental to the public good and contrary to the principles of zoning and planning as they exist in that municipality;” (2) a housing authority project is invalid unless there is a shortage of safe or sanitary dwelling accommodations available at rents which persons of low income can afford, or persons of low income are found to be living in the area in overcrowded or congested, etc., dwellings; (3) the conclusions of the governing body were not supported by evidence, and their actions were consequently “unreasonable and arbitrary.”

In defending this appeal plaintiffs do not rely on the above-noted second ground of decision, and we do not discuss it beyond saying it has no merit. Further, we may summarily dispose of the argument in support of the trial court’s conclusions that the actions of the governing body were arbitrary and capricious and without supporting evidence. In respect of the denial of subdivision approval by the planning board, that body’s decision that the project would violate the master plan and adversely affect traffic patterns was subject to appellate reversal by the governing body. N. J. S. A. 40:55-1.19. We find from the whole record before us that the governing body properly exercised that authority here, and without arbitrariness or unreasonableness. Passaic Junior Chamber of Commerce v. Passaic Housing Authority, 45 N. J. Super. 381, 392 (App. Div. 1957). As to the planning board’s reliance upon the violation of the building height regulations, the merits of this ground for its action stand or fall upon whether the governing body possessed the authority it exercised to exempt the project from those regulations under the Housing Cooperation Law — a subject next discussed.

The pertinent statutes contain two allusions to zoning and building laws and regulations which require reconciliation. The Local Housing Authorities Law, L. 1938, c. 19 (N. J. S. A. 55:14A—11) provides:

All housing projects of an authority shall be subject to the planning, zoning, sanitary and building laws, ordinances and regulations applicable to the locality in which the housing project is situated. In the planning and location of any housing project, an authority shall take into consideration the relationship of the project to any larger plan or long range program for the development of the area in which the housing authority functions.

However, the Housing Co-operation Law, L. 1938, c. 20, adopted at the same time, contains provisions, N. J. S. A. 55:14B-4(d), 7, which permit the governing body by resolution and without public notice to “plan or replan, zone or rezone any part of such [municipality]; make exceptions from building regulations and ordinances and change its map.” The question before us is whether the action of the' governing body violates or is authorized by the said legislation, read, as it must be, in pari materia.

The resolution in question, after reciting that the township had entered into a cooperative agreement with the housing authority pursuant to the Housing Co-operation Law, resolves:

1. That the Zoning Map of the Township of Brick and the Zoning Ordinance known as Ordinance No. 200 and all its supplements and amendments of the Township of Bi-ick be and are hereby amended and supplemented to permit the Township of Brick Housing Authority to construct a 135 foot Hi-Risc for Senior Citizen housing and that the said Ordinance is amended as to the properly described in Schedule A and only to that property for the said public agency.
2. That the amendments to the aforesaid Zoning Ordinance and also the Master Plan shall apply to the property described in Schedule A and to no other property within the Township of Brick, County of Ocean and State of New Jersey.

(Schedule A describes by metes and bounds the plot on which the project is to be constructed.)

Plaintiffs contend that this action, viewed as an ordinance amendment, constitutes illegal spot-zoning since it is deliberately conceived and tailored for a single building only. Implicit in the argument is the position that while the municipality may rezone by resolution for bousing purposes, there still may not be fundamental departure from basic zoning principles. Cf. Bracey v. City of Long Branch, 73 N. J. Super. 91, 104 (Law Div. 1962). This question was raised but not decided in Passaic Junior Chamber of Commerce v. Passaic Housing Authority, supra (45 N. J. Super., at 391). See the many pertinent authorities collected in the cited opinion. We think we need not reach the question here either.

As noted, the statute authorizes the governing body "for the purpose of aiding and co-operating in the planning, undertaking, construction or operation” of housing projects to "make exceptions from building regulations” (N. J. S. A. 55.14B-4, first paragraph and (d)), which action can be taken by resolution. In substance, although not technically so articulated, the resolution granted this project an exception or exemption from the building height regulation of the ordinance. (It has not been argued that the project involves any violation of the ordinance in any other respect.) In the Passaic Housing Authority case, supra, the court discussed but did not have to decide whether in such a juncture as this it is necessary to apply for a variance to the local board of adjustment under N. J. S. A. 40:55-39. (45 N. J. Super., at 391). We think that course would clearly contravene the basic policy of the Housing Co-operation Law, expressed in the provisions cited above, that the exercise of zoning discretion in this particular area is for the governing body alone. Moreover, no particular subsection of N. J. S. A. 40 :55—39 appears to give a board of adjustment power to act on a request for an exception of this particular nature.

The parties have not argued the question whether the statute contains adequate standards for the exercise of the governing body’s discretion in granting a building exception in this special contingency, but these may well be found in the broad purposes and objects of the Housing Co-operation Law, N. J. S. A. 55:14B-2, read together with those of the zoning statute, N. J. S. A. 40:55—32. Cf. Ward v. Scott, 11 N. J. 117, 135-138 (1952).

Moreover, due subservience to the comprehensive principles underlying lawful zoning and variances therefrom enunciated by our courts does not, in our opinion, require invalidation of the action of the governing body here complained of. The project is obviously one designed to serve the public welfare, see Kunzler v. Hoffman, 48 N. J. 277 (1966); ample consideration was given by the housing authority and council to the comparative merits and disadvantages of high-rise and conventional garden-tjrpe apartments for elderly tenants; the suitability of the location for such a project and prospective trends of development of the municipality were taken into account when the project was first approved and thereafter, and the resolution reversing the denial of subdivision found on sufficient proofs that the project would not “affect the surrounding properties and zones in general” or involve undesirable traffic or safety consequences. It is apparent that, in substance, the two resolutions here attacked, both adopted the same day, were both based upon the hearings conducted by the planning board as to subdivision, and by the council in relation to both subdivision and zoning, and that the findings made in either resolution may, in these special circumstances, be properly looked to for support of both actions.

In determining the overall desirability and zoning wisdom of this long-studied project, both as to particular location and physical conception, the judgment of the elected council rather than that of the planning board must control, absent arbitrariness or patent unreasonableness.

Judgment reversed.


author: Collester, J. A. D.

text:
    STATE OF NEW JERSEY, PLAINTIFF-RESPONDENT, v. ROGER KIMBROUGH AND JAMES WADE, DEFENDANTS-APPELLANTS.
    Superior Court of New Jersey Appellate Division
    Argued October 6, 1969
    Decided February 17, 1970.

      Before Judges Cobtfoed, Collester and Kolovsky.

      Mr. Richard Newman, Deputy Public Defender, argued the cause for appellants (Mr. Stanley 0. Van Ness, Public Defender, attorney).

      Mr. David S. Baime, Assistant Prosecutor, argued the cause for respondent (Mr. Joseph P. Lordi, County Prosecutor, attorney).
   The opinion of the court was delivered by

Collester, J. A. D.

Defendants appeal from convictions following a jury trial on an indictment charging them with knowingly receiving a stolen automobile contrary to N. J. S. A. 2A:139-1. The indictment and trial of defendants was prior to State v. Bott, 53 N. J. 391 (1969), which held that a charge of receiving a stolen motor vehicle should be prosecuted for violation of N. J. S. A. 2A:139-3, a statute which does not include the evidentiary rule (set forth in N. J. S. A. 2A:139-1) relating to the inferences of guilty knowledge to be drawn from possession of a stolen article within a year after the theft. While the indictment under N. J. S. A. 2A:139—1 was technically objectionable, it is not a ground for reversal. Ibid., at 402-43. However, since the case was prosecuted under N. J. S. A. 2A:139-1 we are considering it on that basis.

The State’s evidence, in brief, was that shortly after midnight of July 11, 1967 police officers observed a stolen car heading east on South Orange Avenue in Newark. Two police cars took up pursuit. The car stopped on South 11th Street and as one of the officers left his patrol car and approached on foot it sped away. The second patrol car followed and the fleeing vehicle stopped when it struck a curb trying to negotiate a turn at South 12th Street. Officer Minovich said he saw two men run from the car. A short time later the defendants were found hiding in the cellar of a nearby house. Officer Colalillo, who had approached the car on foot at South 11th Street, identified defendants at the trial as the two men he saw in the ear. He said Wade was the driver and Kimbrough was a passenger.

Defendants denied the crime charged. They testified they were passengers in the car which was driven by a man named Glenn and that they had no knowledge the car had been stolen until Glenn so advised them while the car was being pursued by the police. Kimbrough said he met Glenn at the Park Lounge bar earlier in the evening and became a passenger in the car when Glenn offered to drive him to South Orange. Wade testified he met Kimbrough and Glenn outside the Park Lounge and entered the car when Glenn agreed to drive him to the Glitter Club, another Newark bar. Both defendants said they ran away after the car struck the curb because they were afraid they would be charged with stealing it.

They testified that after their arrest they told the police that Glenn was the driver. This was denied by the police, who said Wade told them Kimbrough was driving the car.

I

Defendants contend the trial court erred when it refused to instruct the jury as to the meaning of the word “possession,” within contemplation of N. J. S. A. 2A:139-1, necessary to give rise to the inference of guilty knowledge provided for in the statute, particularly since it is undisputed that a driver-passenger relationship was involved. Their defense was that they were merely passengers in a stolen car driven and possessed by Glenn, while the State contended there was no third party in the car but that Wade was the driver and Kimbrough the sole passenger. They argue that under either version of the facts the court erred when it refused to definitively instruct the jury as to the meaning of possession within contemplation of the statute or to inform the jury that there is a distinction regarding what constitutes possession as between the driver of an automobile and a mere passenger.

The State concedes that the court did not expressly define the term “possession55 necessary to trigger the statutory inference of guilty knowledge. However, it argues that the charge adequately apprised the jury of the applicable law, particularly since the court charged the jury that if it believed tbe explanation given by defendants was reasonable, they were to be acquitted.

In charging the jury the trial judge road N. J. S. A. 2A: 139-1 in its entirety. In doing so he advised the jury that proof of possession oí a stolen motor vehicle within a year from the date of the theft was sufficient evidence to authorize conviction of the defendants unless they proved to the jury’s satisfaction that their possession arose under one of the five examples innocent acquisition described in the statute and that “the statute does not preclude a defendant from presenting other defenses or explanations as to his or their possession of the alleged stolon property.” He also told the jury that “the statute creates a permissive presumption of guilty knowledge on the part of the defendant from the mere possession of the stolen goods within the specified period.”

The crime of receiving stolen property under N. J. S. A. 2A:139-1 requites proof of three things to establish guilt: (1) the property was stolen, (2) the accused received it, and (3) at the time he received it, he knew it was stolen. “Receiving” envisages possession or control as an essential element. State v. Bozeyowski, 77 N. J. Super. 49, 57 (App. Div. 1962), cert. den., 374 U. S. 851, 83 S. Ct. 1916, 10 L. Ed. 2d 1071 (1963). Possession signifies intentional control and dominion. Actual physical possession is not a requisite of receiving — it may he constructive. Ibid. One has possession as soon as he intentionally obtains a measure of control or dominion over the custody of the stolen property even though physical possession is in another. If proof of possession of stolen property within one year from the date of the theft is established the jury is permitted to infer that the accused had guilty knowledge that the property was stolen — the third essential element of the crime. Cf. N. J. S. A. 2A :139-1 with respect to prosecution under N. J. S. A. 2A:139-3; State v. Bott, supra, 53 N. J., at 400-401.

In State v. Serrano, 53 N. J. 356 (1969), defendant and Rafael Cesareo were charged by indictment under N. J. S. A. 2A:139-1 with unlawfully receiving a stolen car knowing it to have been stolen. Both were convicted and Serrano appealed. The court held that evidence that Serrano was a mere passenger in the stolen vehicle was not sufficient to show possession of the car or to support the inference that he had received it knowing it had been stolen, and that Serrano’s motion for acquittal should have been granted. The court also commented on the inadequacy of the charge to the jury, stating:

[T]here was no discussion of what constituted possession of the car, no reference to whether under ihe evidence the jury could find possession in anyone other than the driver, and no instruction that they should acquit Serrano if they found his statu® in the car was only that of a passenger who was picked up by the driver Cesáreo at the intersection described in the testimony. In effect, the court advised the jury that they could find that Serrano was in possession of the stolen vehicle within the contemplation o£ the statute simply because he was riding in it as a passenger, [at 3591

We are satisfied that the charge in the instant ease suffers from a like inadequacy and that the court erred in refusing to instruct the jury regarding the meaning of possession necessary to permit the statutory inference of guilty knowledge. The fact that the court told the jury it could acquit defendants if it believed their story was not sufficient to overcome the deficiency of the charge. Defendants were entitled to have the court enlighten the jury as to the distinction between a passenger and the driver of the car with respect to the meaning of possession necessary to permit the jury to infer guilty knowledge. Eailure of the court to do so could result in the conviction of an innocent passenger. In fact, a reading of the charge indicates that the jury could assume therefrom that defendants were in possession of the car within contemplation of the statute merely because they were passengers, thereby removing from the State the burden of proving possesssion. The court’s refusal to charge the jury as requested was prejudicial and requires a reversal.

II

Because this case must be retried we deem it appropriate to dispose of the other point claimed by defendants to be reversible error since it might recur on the retrial.

As stated above, both defendants testified in their own defense and said that Glenn drove the car in which they were passengers without knowledge on their part that it had been stolen. On cross-examination they said that when questioned by the police following their arrests they told the same story. They denied Wade told the police, in Kimbrough’s presence, that Kimbrough was the driver, and denied that they had not told the police that Glenn was. In rebuttal, Officer Minovich, over objection, testified that defendants never said that there was a third person named Glenn who had driven the car, but that Wade, in Kimbrough’s presence, said Kimbrough was the driver. The trial court, in overruling the objection, held that the rebuttal testimony was admissible to affect their credibility as witnesses.

Defendants contend that the court erred in permitting the State to present rebuttal testimony of a statement previously given by Wade to the police without first determining whether he had been informed of his rights guaranteed by Miranda v. Arizona, 384 U. S. 436, 86 S. Ct. 1602, 16 L. Ed. 2d 694 (1966), before making the statement. They argue here, as they did below, that a statement made without the cautionary warnings of Miranda cannot be used by the State to impeach a defendant’s trial testimony.

There are cases in the federal and state courts which support defendants’ position. Groshart v. United States, 392 F. 2d 172, 178 (9 Cir. 1968): United States v. Fox, 403 F. 2d 97, 103 (2 Cir. 1968); Commonwealth v. Padgett, 428 Pa. 229, 237 A. 2d 209, 210 (Sup. Ct. 1968); People v. Marsh, 14 Mich. App. 518, 165 N. W. 2d 853, 859-861 (Ct. App. 1969); Cardwell v. Commonwealth, 209 Va. 412, 164 S. E. 2d 699, 702 (Sup. Ct. App. 1968); Franklin v. State, 6 Md. App. 572, 252 A. 2d 487, 491 (Ct. Sp. App. 1969); State v. Brewton, 247 Or. 241, 422 P. 2d 581, 583 (Sup. Ct. 1967), cert. den. 387 U. S. 943, 87 S. Ct. 2074, 18 L. Ed. 2d 1328 (1967); State v. Galasso, 217 So. 2d 326, 329 (Fla. Sup. Ct. 1968). Other jurisdictions take a contrary view. State v. Butler, 19 Ohio St. 2d 55, 249 N. E. 2d 818 (Sup. Ct. 1969); People v. LaBatt, 108 Ill. App. 2d 18, 246 N. E. 2d 845 (Ill. Ct. App. 1969); People v. Miles, 23 N. Y. 2d 527, 297 N. Y. S. 2d 913, 245 N. E. 2d 688 (Ct. App. 1969), citing People v. Kulis, 18 N. Y. 2d 318, 274 N. Y. S. 2d 873, 875, 221 N. E. 2d 541, 542 (Ct. App. 1966); cf. State v. Jackson, 201 Kan. 795, 443 P. 2d 279, 282 (Sup. Ct. 1968), cert. den., 394 U. S. 908, 89 S. Ct. 1019, 22 L. Ed. 2d 219 (1969).

We conclude that the ruling laid down in Miranda does not bar the rebuttal testimony presented by the State in this ease. In Miranda the court held that statements of an accused obtained by the police without prior warnings of his rights to remain silent, to counsel and appointed counsel if indigent, in violation of the accused’s Eifth Amendment right against self-incrimination, were not admissible on the State’s direct case.

The factual situation in Miranda was vastly different from the present case. Eirst, the testimony of defendants’ prior statements was not offered as part of the prosecution’s direct case against defendants. It was admitted only after defendants had taken the stand and placed before the jury their version of the pretrial statements made to the police. By placing their version in evidence defendants also placed the truthfulness thereof in issue and the State was entitled to offer its version in rebuttal.

It is well settled that when a defendant waives his right to remain silent and takes the stand in his own defense he is thereby subjected to cross-examination as to the credibility of his story. State v. Burt, 107 N. J. Super. 390, 393 (App. Div. 1969); and see Johnson v. United States, 318 U. S. 189, 195, 63 S. Ct. 549, 87 L. Ed. 704 (1942). Here, the rebuttal testimony was permitted only to impeach the credibility of defendants as witnesses.

The distinction between admissibility of wrongfully obtained evidence to prove the State’s case in chief and its use to impeach the credibility of a defendant who takes the stand was expressed in Walder v. United States, 347 U. S. 62, 74 S. Ct. 354, 98 L. Ed. 508 (1954), where Justice Frankfurter writing for the court stated:

It is one thing to say that the Government cannot make an affirmative use of evidence unlawfully obtained. It is quite another to say that tile defendant can turn the illegal method by which evidence in the Government’s possession was obtained to his own advantage, and provide himself with a shield against contradictions of his untruths, [at 65, 74 S. Ct., at 356]

While Walder dealt with evidence inadmissible under the Fourth Amendment, we can see no logical reason why it should not apply with like force to the privileges granted an accused under the Fifth Amendment. Under the Fifth Amendment a defendant is accorded the privilege of not being compelled to testify as a witness against himself, or to have prior statements used by the prosecution to prove his guilt unless properly warned of his rights. However, that privilege does not permit a defendant to lie with impunity with respect to a prior statement he made to the police once he elects to take the stand to testify.

Moreover, we conclude that the door was opened for the State to bring out on rebuttal what was said by defendants when they were interrogated by the police. The record shows that the first reference to such conversation was brought out by Kimbrough’s attorney on cross-examination of Officer Minovich on the State’s case when he asked the officer if at any time on the morning of July 13 he had heard defendants state that there was a third person in the ear. Thereafter, Kimbrough testified on his direct examination that he told police after his arrest that Glenn was the driver. As stated above, both defendants testified on cross-examination, without objection, that they had told the police that Glenn was the operator of the car and denied that Wade said Kimbrough was the driver.

Where defendants’ version of their conversation with the police was elicited by defense counsel and repeated on cross-examination, the State may introduce its version of the conversation on rebuttal. Of. concurring opinion of Judge Waterman on this point in United States v. Vanterpool, 394 F. 2d 697, 700 (2 Cir. 1968), with which the majority of the court agreed (at 699).

We also find no merit to the argument advanced by defendants that the Tebuttal testimony was inadmissible because it dealt with a collateral matter or violated the hearsay rule. We hold that the court did not err in permitting the rebuttal testimony to be received in evidence.

For the reasons expressed under Point I above concerning error in the court’s charge, the judgments of conviction must be reversed and the ease remanded for a new trial. Prior to the retrial the indictment should be amended to recite. N. J. S. A. 2A:139-3 as the statute allegedly violated instead of N. J. S. A. 2A:139-1. State v. Bott, supra, 53 N. J., at 403.

Reversed and remanded.


author: Goldmann, P. J. A. D.

text:
    STATE OF NEW JERSEY, PLAINTIFF-RESPONDENT, v. THOMAS A. JOHNSON, JR., DEFENDANT-APPELLANT.
    Superior Court of New Jersey Appellate Division
    Argued October 20, 1969
    Decided February 25, 1970.

      Before Judges Goldmann, Lewis and Matthews.

      Mr. Edward P. Eannigan, Assistant Deputy Public Defender, argued the cause for appellant (Mr. Stanley G. Van Ness, Public Defender, attorney).

      Mr. Robert L. Podvey, Assistant Prosecutor, argued the cause for respondent (Mr. Joseph P. Lordi, Essex County Prosecutor, attorney; Mr. David 8. Baime, Assistant Prosecutor, of counsel and on the brief).
   The opinion of the court was delivered by

Goldmann, P. J. A. D.

The principal question raised on this appeal is whether a defendant convicted of violating the Uniform Narcotic Drug Law (N. J. S. A. 24:18-1 et seq.) may be punished as a second offender under N. J. S. A. 24:18-47(c)(2) when the second violation occurred, and the indictment based thereon was entered, prior to his first conviction under the act. We hold that he may not.

Defendant appeals through the Public Defender from a 5-6-year State Prison sentence imposed upon him as a second offender under N. J. S. A. 24:18-47(c) (2) after he had pleaded guilty to a charge of unlawful possession of a narcotic drug (N. J. S. A. 24:18-4). Defendant had twice violated the Uniform Narcotic Drug Law. The first offense occurred in November 1966 and resulted in Essex County Indictment 1237-66, and the second in February 1967, resulting in Essex County Indictment 1319-66. He was tried on the former, found guilty, given a suspended 2-3-year sentence and put on probation for three years. He subsequently pleaded guilty to the latter indictment and received the sentence here under review. The following clarifies the chronology of events:

Indictment No. 1237-66

Indictment No. 1319-66

November 23, 1966 — Violation (possession of narcotic drug) ; released on bail

February 13, 1967 — Violation (possession of narcotic drug)

March 9, 1967 — Indicted

March 20, 1967 — Pleaded not guilty

March 21, 1967 — Indicted

April 10, 1967 — Pleaded not guilty

April 13, 1967—Released on own recognizance

May 22, 1967 — Convicted after jury trial

June 21, 1967 •—• Sentenced to serve from two to three years; sentence suspended; put on probation for three years

September 30, 1968 — Pleaded guilty

October 31, 1968 — Sentenced to from five to six years as a second offender

Defendant received no notice that he was to be sentenced as a second offender, either by way of accusation or otherwise. The sentencing judge made it clear that he imposed the sentence he did because he felt bound by the provisions of N. J. S. A. 24:18-47(c) (2), stating:

The Legislature feels that people who violate the narcotics laws should be sent to jail. * * * XCnowing this to be the Legislative policy and knowing that you are not a single, violator but rather a second offender for the same particular offense, I cannot justify any action on my part in not imposing a custodial sentence in view of that provision of the law which binds me. * * *

I

Defendant first contends that he was improperly sentenced as a second offender because his second offense was committed before his conviction on the first offense. This question was not expressly raised below, and is therefore projected as plain error.

N. J. S. A. 24:18-47 provides that any person

(e) Who violates any other provision [of the Uniform Narcotic Drug Law] shall be guilty of a high misdemeanor and shall be punished as follows:
(1) for a first offense, by a fine not exceeding $2,000.00 and by imprisonment, with hard labor, for a term of not less than 2 years nor more than 15 years;
(2) for a second offense, by a fine not exceeding $5,000.00 and by imprisonment, with hard labor, for a term of not less than 5 years nor more than 25 years;
In case a person charged with a violation of any of the provisions of this chapter shall have been previously convicted of a violation of the laws of the United States or of any other State, territory or district relating' to narcotic drugs, such previous conviction shall for the purpose of this section, be deemed a first or second offense as the case may be.

A more severe punishment on conviction for a second offense is deemed highly penal and therefore must be strictly construed. United States v. Lindquist, 285 F. 447, 448 (D. C. W. D. Wash. 1921); State v. Meinken, 10 N. J. 348, 352 (1952). Moreover, it is firmly established that the erroneous sentencing of a person as a second offender may constitute plain error, even through the sentence imposed does not exceed the maximum allowed for a first offense. State v. Booker, 88 N. J. Super. 510 (App. Div. 1965).

Defendant contends that the word “offense,” as used in the cited statute, must be read as referring to a conviction if it is to provide a basis for enhancing punishment as a second offender — this in contrast to the alternative construction whereby a person who had violated the Uniform Narcotic Drug Act on successive dates would be punishable as a multiple offender, emphasis being placed on the time of commission rather than on the time of conviction. Our problem is therefore one of statutory construction.

We are referred by the parties to cases based on different, if similar, statutes providing, for example, for enhanced punishment for multiple violations of drunken driving statutes, federal narcotic laws, or habitual offender acts. Thus, a distinction between the commission of and the conviction for an offense was made in Holst v. Owens, 24 F. 2d 100 (5 Cir. 1928), in construing the multiple offender section of the former National Prohibition Act, 27 U. S. C. A., § 46. The court, in referring to successive “offenses” rather than “convictions,” pointed out that

It cannot legally be known that an offense has been committed until there lias been a conviction. A second offense, as used in the criminal statutes, is one that has been committed after conviction for a first offense. Likewise, a third or any subsequent offense implies a repetition of crime after each previous conviction, [at 101]

See also, Singer v. United States, 278 F. 415, 420 (3 Cir. 1922), dealing with the same statute; Annotation, "Chronological or procedural sequence of former convictions as affecting enhancement of penalty for subsequent offense under habitual criminal statutes,” 24 A. L. R. 2d 1247, 1249, 1252 (1952), and 3 A. L. R. 2d, Later Case Service 728 (1965), stating this as the majority view.

State v. Deckert, 69 N. J. Super. 105 (Cty. Ct. 1961), on which the State relies, is not relevant. The court there held that N. J. S. A. 39:4-50, dealing with persons convicted of drunken driving and providing for an increased penalty for second offenders, did not require that a conviction for a first violation precede a second violation in order for the second violation to carry with it the increased penalty. The decision was based upon a change in the wording of the statute by the amendment effected by L. 1952, c. 286. The statute had originally read, in pertinent part:

* * * Any person who shall violate this provision shall, upon conviction thereof for a first offense, be subject to [a fine or imprisonment, or both] * * *. Any person who shall violate this provision, having been convicted of a previous violation thereof, shall be imprisoned * * *. [L. 1931, c. 171, § 9; emphasis added]

The 1952 amendment read, in pertinent part:

A person who operates a motor vehicle while under the influence of intoxicating liquor * * * shall be subject, for a first offense, to [a fine or imprisonment, or both] * * * For a subsequent violation, he shall be imprisoned * *

Although the amendment deleted the words ££having been convicted of a previous violation thereof,” it inserted the clause “who has been convicted of a previous violation” in a subsequent paragraph having to do with the contents of a complaint charging a second violation. The Beckert court apparently took this as another indication that the deletion was not a mero inadvertence, stating (at 109) that “The Legislature in the preparation of the amendment avoided the nse of the phrase Teen convicted of a previous violation’ and this omission seems to be with deliberation.”

Since we have nothing by way of legislative history or successive amendments to guide us, we must analyze the intent and purpose of the language of N. J. S. A. 24:18-47(c) in terms of the most plausible or reasonable end to be accomplished. If the statute is considered as essentially punitive and repressive, then it may be argued that it is the mere commission of the offense that is critical, and enhanced punishment would therefore be justified. On the other hand, if one accepts the more modern view that our system of criminal justice is aimed equally at rehabilitating offenders, then it would not be appropriate to sentence an accused as a second offender before he had had an opportunity to amend his ways after initial confrontation with the courts of law.

As noted above, the great weight of authority in the United States appears to support the latter view. Interestingly enough, the court in Dechert recognized this when it said:

The preponderance of authority supports the view that the prior conviction, in order to be available for imposition of increased punishment, must precede the commission of the principal offense, that is,, the latest prosecution in point of time. The philosophy inherent in this theory is that the Legislature in enacting such statutes intended them to serve as a warning to first offenders and to afford them an opportunity to reform and that the reason for the infliction of severer punishment for a repetition of offenses is not so much that defendant lias sinned more than once as that he is deemed incorrigible when he persists in violating the law after conviction of previous infractions. * * *. [69 N. J. Super., at 107]

Gonzalez v. United States, 224 F. 2d 431 (1 Cir. 1955), was a case arising under the Eederal Narcotics Act of November 2, 1951, 21 U. S. C. A. § 174, and dealt with a fact situation paralleling the one here involved. Gonzalez had been arrested for violating the narcotics law, pleaded guilty to the charge on February 12, 1952, and was released on bail. He committed other violations of the narcotics law at various times between May 23 and June 25, 1952. On July 29, 1952, following his re-arrest for these violations, he was sentenced to a five-year term as a first offender for the violation to which he had pleaded guilty in February. In September 1952 he was sentenced to serve a term of ten years for the May-June violations as a second offender.

21 U. S. C. A. § 174, under which the indictments were brought, read, in pertinent part:

(e) Whoever * * * receives, conceals, buys, sells * * * any such narcotic drug * * * in violation of the laws of the United States, shail be fined * * * and imprisoned not less than two years or more than five years. For a second offense, the offender shall be fined * * * and imprisoned not less than five or more than ten years. For a third or subsequent offense, the offender shall be fined * * * and imprisoned not less than ten or more than twenty years. Upon conviction for a second or subsequent offense, the imposition or execution of sentence shall not be suspended and probation shall not bo granted. For the purpose of this subdivision, an offender shall be considered a second or subsequent offender, as the case may be, if he previously lias been convicted of any offense the penalty for which is provided in this subdivision * * *.

The court held that to justify the impositiou of a second offender sentence the prior conviction (of July 29, 1952) must have been entered before the commission of the May-June offenses for which Gonzalez was now being punished. The matter was remanded to the District Court for re-sentencing.

In arriving at its decision, the court (Magruder, C. J., Biggs and Woodbury, JJ.) discussed the reformation and retribution theories of punishment underlying the practice of imposing a more severe punishment on multiple offenders. The court said:

* ss si jf the purpose of subsequent offender statutes is to deter criminal conduct, we can see no reason why the increased penalties should not be applied to any subsequent offense whether or not there has been an intervening conviction and sentence since presumably a greater penalty would be required to deter a repetition of criminal activity by an offender who has not been convicted previously than to deter repetition by the offender who has been subjected to the corrective impact of conviction and sentence. If, on the other hand, subsequent offender statutes are intended to reform the offender and dejsrive him by reason of Ms incarceration of the opportunity for continued criminal conduct, then such statutes would seem to apply properly only to offenders convicted prior to the subsequent offense, for the repetition of criminal activity after conviction would show the inadequacy of a first-offender penalty to perform this function and the need of increased penalties. If the purpose be “to vindicate the law,” as the Supreme Court put it, such statutes apparently would be applicable only to those convicted prior to the later offense because the social demand for increased penal sanctions would be directed primarily at the recidivist and not at an individual who had rejjeatedly committed offenses condemned by the statute but who had never been brought to the bar of justice. [224 F. 2d at 433]

We cannot overlook the final paragraph of N. J. S. A. 24:18-47 which we reproduce here for convenient reference:

In case a person charged with a violation of any of the provisions of this chapter shell have been previously convicted of a violation of the laws of the United States or of any other State, territory or district relating to narcotic drugs, such previous conviction shall for the purpose of this section, be deemed a first or second offense as the case may be. [Emphasis added]

This provision clearly evinces a legislative intent to require that a conviction for a prior violation precede an accused person’s being charged with a second offense before bringing into play the enhanced penalty provisions, where the prior violation involved the laws of another state or the federal law. That the words “previously convicted” and “such previous conviction” in the final paragraph of N. J. S. A. 24:18-47 must be considered with respect to the date the person is charged is obvious, if for no other reason than that the quoted language offers no other temporal point of reference. It would be incongruous if this paragraph of the statute imposed a limitation which was not equally applicable to the paragraphs preceding it, particularly in view of the fact that its sole function is to place out-of-state and federal convictions on the same footing as New Jersey convictions. It does no more than comport with justice and sensibility to apply an equivalent standard to local offenses.

As tangential support for his position, defendant notes the cases decided under the Habitual Offenders Act, N. J. S. A. 2A:85-8, 9 and 12. In the leading case of State v. McCall, 14 N. J. 538 (1954), the Supreme Court held that, within the meaning of the statute, a “subsequent offense” could only be an offense committed after a prior conviction, and emphasized that the essential evil to be combatted was recidivism. Patently, there can be no recidivism prior to conviction of a crime. Absent such a prior conviction, the sentencing court is unable to weigh the corrective influence of a first conviction. See State v. McCall, 27 N. J. Super. 157, 173-174 (App. Div. 1953). (dissenting opinion of Judge (now Justice) Schettino); and see State v. Harris, 97 N. J. Super. 510 (App. Div. 1967).

"We therefore conclude that the sentencing judge committed plain error: defendant could not be sentenced as a second offender when the second offense occurred prior to his conviction for the first offense. We read the statute as intended to punish recidivism — the failure of a person to reform his ways after a prior conviction for his antisocial behavior — and not merely to provide increased punishment for multiple offenses. The problem is not that a person has committed two similar crimes, but rather that he has failed to restructure his life-style after having formally been punished.

II

Also raised as plain error on defendant’s behalf is that the trial judge committed reversible error by failing to give him proper notice that he was to be charged as a second offender, or a reasonable opportunity to be heard on the matter. When defendant, on September 30, 1968, pleaded guilty to illegal possession of a narcotic drug on February 13, 1967, mention was made of the fact that he had earlier received a suspended sentence for a similar violation (i. e., on June 21, 1967). This occurred in the course of defense counsel’s request that defendant he released on bail — a request which was denied. When sentence as a second offender was imposed on October 31, 1968, defense counsel said:

Your Honor, 1, frankly, am caught quite by surprise by the court’s sentence. I did not realize that this man was charged as a second offender nor did I realize that as he was charged before this court Ms sentence is a mandatory imprisonment for the terms indicated by your Honor. I was of the opinion that he would have to be charged as a second offender.
I would, under the condition —• if it is as the court stated, not have advised this man originally as I did advise him. I think he has grounds at this time to ask that fie be giveu permission to retract his plea. I feel he may have grounds to appeal the sentence. So 1 would ask this court to set bail at this time pending an appeal.

Bail was set at $2,500.

Clearly, defendant was given no notice whatever as to the sentencing judge’s intention to impose the enhanced penalty, and his counsel was not in a position to present his client’s case adequately. Accordingly, what occurred comes squarely within the proscription in the holding of State v. Booker, above, which requires that, absent a charge in the indictment that defendant was a prior offender, an accused was not subject to enhanced punishment unless and until an accusation was filed against him charging him with a prior offense. Cf. State v. Taylor, 72 N. J. Super. 388 (Cty. Ct. 1962). Moreover, it must be recalled that defendant changed his plea to guilty to the second charge, presumably not recognizing the precariousness of his situation.

Judgment reversed and the matter remanded for re-sentencing defendant as a first offender.


author: Crane, A. J. S. C.

text:
    STATE OF NEW JERSEY, PLAINTIFF, v. PATRICK LORD, DEFENDANT.
    Passaic County Court Criminal Division
    Decided February 20, 1970.

      Mr. Donald Bosenfelt, appeared for defendant (Messrs. Grabow, Yer'p & Bosenfelt, attorneys).

      Mr. Charles Carroll, Assistant Prosecutor, appeared for the State.
   Crane, A. J. S. C.

Defendant was indicted for larceny of a truck. When the case was called for trial, defense counsel requested a conference with the prosecutor to discuss the possibility of a plea. It was represented at that time that defendant had no prior record of convictions, that the truck in question had been in defendant’s custody as yardmaster of his employer’s place of business, that he had taken the truck for a ride and that it had been subsequently returned. As a result of the discussions, it was agreed that a complaint charging unlawful use of a motor vehicle under the provisions of N. J. S. A. 2A:170—38 would be prepared, that defendant would plead guilty to the complaint, and that after sentencing the prosecutor would move the indictment for dismissal.

The prosecutor now moves to set aside the plea of guilty to the disorderly persons charge and to reinstate the indictment to the active trial list upon the ground of mistake of fact. It is not asserted that any misrepresentations were made by defense counsel or that the representations made were untrue, but rather that the assistant prosecutor who agreed to prepare the complaint and move the indictment for dismissal was not fully aware of all the facts in the prosecutor’s file. He states that if he were aware of all the factual material in his file, he would not have agreed to permit the matter to be disposed of as a disorderly persons offense. Specifically, he says that the truck was broken into by two men at a place where defendant had parked it, and when the police arrived the two men were in the process of unloading the truck. He suspects, but presently has no way of proving, that defendant had some connection with the men who were looting the truck.

A motion for withdrawal of a plea of guilty may be made by a defendant prior to sentencing under R. 3 :21—1. Strong considerations of policy favoring the finality of judicial proceedings weigh heavily against granting such a motion unless it appears that the plea was not entered voluntarily or with a full understanding of its consequences. State v. Herman, 47 N. J. 73 (1966). We are aware of no precedent or rule which permits the court to set aside a plea of guilty at the instance of the State. The reasons of policy which militate against permitting a defendant to withdraw a plea of guilty which has been knowingly and voluntarily made, also weigh heavily against setting aside the plea at the instance of the State. Moreover, a defendant has materially altered his position by entering a plea of guilty to a lesser included offense. In this instance defendant voluntarily made highly inculpatory statements in open court. He admitted having taken the truck without the owner’s permission and having driven it to a location in another city. Whether such admissions, made during the entry of a plea of guilty, worüd be admissible against him in a subsequent trial is not entirely clear. See State v. Leaks, 124 N. J. Law 261 (E. & A. 1940); Note, 79 Harv. L. Rev. 935, 1044; Annotation, 86 A. L. R. 2d 326. However, under these circumstances the prosecutor’s representation in open court that the indictment would be moved for dismissal after sentencing amounted to a pledge of the public faith. State v. Ashby, 43 N. J. 273 (1964). That pledge ought not be withdrawn, absent a showing of bad faith or manifest injustice to the State.

The motion will be denied.