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Welding Indus. Supply v. Northtown Indus.

OPINION FILED MARCH 27, 1978.

WELDING INDUSTRIAL SUPPLY COMPANY, INC., PLAINTIFF-APPELLEE,

v.

NORTHTOWN INDUSTRIES, INC., ET AL., DEFENDANTS. — (DAVID SCHIMBERG, DEFENDANT-APPELLANT.)



APPEAL from the Circuit Court of Cook County; the Hon. RICHARD L. SAMUELS, Judge, presiding.

MR. JUSTICE O'CONNOR DELIVERED THE OPINION OF THE COURT:

Rehearing denied April 24, 1978.

Plaintiff, Welding Industrial Supply Company, Inc. (Welding), as the judgment creditor of defendants, Northtown Industries, Inc., and David Schimberg, instituted supplementary proceedings to enforce its judgment. During those proceedings, the defendant Schimberg was served with a citation to discover assets, a petition for a rule to show cause and a body attachment. At two hearings during the supplementary proceedings Schimberg gave conflicting testimony about the shares he held in a corporation. The trial court ordered defendant Schimberg incarcerated for 30 days for contempt of court for giving perjured testimony.

Schimberg appeals the contempt order, raising four issues: (1) whether defendant's statements were perjured; (2) whether defendant's actions were a direct contempt of court; (3) whether defendant was entitled to a hearing by an impartial judge on the contempt citation; and (4) whether the trial court conducted a fair hearing on the contempt citation.

The record discloses that about June 1, 1975, Schimberg was served with a citation to discover assets. Defendant was later served with a petition for a rule to show cause why he should not be held in contempt, returnable August 19, 1975. On October 15, 1975, on a citation proceeding to discover assets, Schimberg testified that he owned all of the stock of Bobcat Machinery Co., Inc., Northtown Industries, Inc., and Harley Machinery, Inc. In addition, he owned four shares of Occidental Petroleum and 1200 shares of Burma Mines stock.

After the hearing on October 15, 1975, the trial court entered an order on October 24, 1975, requiring Schimberg inter alia to pay plaintiff $500 every two weeks, to deliver instanter to the Sheriff of Cook County for sale two, three or four shares of Occidental Petroleum stock, 1200 shares of Burma Mines stock, one 1973 Buick automobile owned by Northtown Industries, 100% of the shares of stock of Bobcat Machinery Co., Inc., Harley Machinery, Inc., Northtown Industries, Inc., and Machinery Sales, Inc. In the alternative, defendant was to pay plaintiff $3,000 instanter instead of turning over the listed shares of stock.

In a second hearing on January 19, 1976, Schimberg testified that he had not delivered the Bobcat shares because they had never been issued and that he had not delivered the Harley Machinery shares but was trying to find them. He was not aware that he was to deliver the Machinery Sales shares. Schimberg did not answer counsel's inquiry about the delivery of the Northtown shares. He had delivered two shares of Occidental Petroleum and had ordered delivery of the Burma Mines stock. Schimberg had not paid the alternative $3,000 in lieu of turning over the shares. He did not comply with the order to pay plaintiff $500 every two weeks. Neither Northtown nor Bobcat had any receivables.

Although the hearings on the rule to show cause resumed on February 10, 1976, defendant was not present. On that date the trial court entered an order, based on defendant's attorney's representation that Bobcat and Northtown had receivables, prohibiting the transfer or encumbrance of the receivables of Bobcat and Northtown. The trial court also issued a writ of attachment for David Schimberg on that date.

On March 10, 1976, another hearing on the pending petition for a rule to show cause was held. Defendant testified that the Bobcat shares had been issued and had been pledged to secure a $5,000 loan from a Mr. Tinhino in August 1975. The loan proceeds were used to start Machinery Sales, Inc. The trial court later interrupted the proceedings and stated:

"* * * This, I call you — I call your attention to the answer given before me on January 19, 19 — and he never issued the stock, and I also call your attention to the answer of March the 10th, today — I am sorry. Correct that.

Gentlemen, on January 19th Mr. Schimberg said he never issued the Bobcat stock, and today, the stock that he never issued was placed last August.

I think that that speaks for itself.

Both statements having been made under oath, the defendant is found in contempt of Court for perjuring himself on one of those Court dates, and for that will stand committed for thirty days, with a stay of mittimus, until he feels better, but I will not have a sworn statement ...


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