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Kauk v. Matthews

OPINION FILED SEPTEMBER 3, 1981.

JACOB KAUK, PLAINTIFF-APPELLANT,

v.

DAN C. MATTHEWS, JR., ET AL., DEFENDANTS. — (BARBER-GREENE COMPANY, RESPONDENT-APPELLEE.)



APPEAL from the Circuit Court of Kane County; the Hon. PATRICK J. DIXON, Judge, presiding.

MR. JUSTICE REINHARD DELIVERED THE OPINION OF THE COURT:

Rehearing denied October 19, 1981.

This appeal arises from an order entered by the trial court denying plaintiff certain relief against a third party respondent employer rendered during the course of supplemental proceedings pursuant to section 73 of the Civil Practice Act (Ill. Rev. Stat. 1979, ch. 110, par. 73) to enforce a judgment for past-due rent.

Plaintiff, Jacob Kauk, filed a complaint pursuant to the Illinois forcible entry and detainer statute against Dan Matthews (judgment debtor). The court entered judgment against the judgment debtor ordering a return of the rented premises and payment of $460 representing past-due rent. Subsequently, in order to enforce the money judgment, a citation to discover assets was served upon the judgment debtor's employer, Barber-Greene Company, respondent herein. The citation required Barber-Greene to refrain from transfering any money which might become due the judgment debtor and to appear before the court and produce records of all the payroll checks issued to the judgment debtor in the year 1980. The citation hearing was delayed three times on plaintiff's motions for continuances, and the record does not disclose that an appearance was ever entered by Barber-Greene. However, while Barber-Greene did supply plaintiff's counsel with the material requested on the face of the citation, it failed to withhold any funds due the judgment debtor from his paycheck. Counsel for plaintiff then contacted Barber-Greene's general accounting manager, Mr. Kenneth Klomhaus, requesting a withholding of an amount from the judgment debtor's gross pay and stating that a refusal to do so might subject Klomhaus to the contempt power of the court. Klomhaus, on the advice of counsel, still refused to withhold any of the judgment debtor's wages.

As a result, counsel for plaintiff appeared in court on September 17, 1980, and requested an order holding Barber-Greene liable for the amounts not deducted and an issuance of a rule to show cause why Klomhaus and Barber-Greene should not be held in contempt of court. Counsel for Barber-Greene was also present. The court heard oral argument from the parties and denied both of plaintiff's requests. However, the court ordered Barber-Greene to begin to deduct amounts from the judgment debtor's paychecks upon receipt from plaintiff of a garnishment summons.

Plaintiff has elected not to proceed with a garnishment under the Wage Deduction Act and appeals the court's decision to disallow his proposed use of the citation proceedings. In its brief, Barber-Greene concedes that it has at all times been willing to accept and comply with a wage garnishment summons and that it has not yet commenced wage deduction due to plaintiff's insistence on using the citation procedure.

The issue in this case is whether the Wage Deduction Act (Ill. Rev. Stat. 1979, ch. 62, par. 71 et seq.) is the sole and exclusive means of attaching a judgment debtor's wages in order to satisfy a judgment. Since there is a virtual absence of case law on this precise issue, an examination of the Wage Deduction Act and the supplemental proceedings (hereinafter citation proceedings) under the Civil Practice Act (Ill. Rev. Stat. 1979, ch. 110, par. 73) is necessary in order to ascertain the intent of the legislature.

The General Assembly first enacted the citation procedure statute in 1941. The municipal courts> of Chicago had used a similar procedure for many years prior to the enactment of the statute (Ill. Rev. Stat., ch. 37, par. 424 (repealed 1963)), and the creditor's bill was an available procedure also. The citation to discover assets procedure as initially enacted was, however, somewhat limited in its utility. Courts> interpreted the statute as not granting them the power to prevent the transfer of assets owed to the judgment debtor found in the hands of a third party. (Ill. Ann. Stat., ch. 110, par. 73, Historical and Practice Notes, at 400 (Smith-Hurd 1968).) Thus, the use of the statute was basically limited to a discovery device. However, a 1955 amendment greatly enhanced the effectiveness of the procedure. (Ill. Laws 1955, § 1, at 2238, eff. Jan. 1, 1956.) The present-day statute now provides not only for the discovery of assets and income but also grants the court power to compel the party cited to apply the discovered assets toward payment of the underlying judgment. A synopsis of the citation procedure is provided in the statute's first sentence:

"A judgment creditor, or his successor in interest when that interest is made to appear of record, is entitled to prosecute supplementary proceedings for the purposes of examining the judgment debtor or any other person to discover assets or income of the debtor not exempt from execution, a deduction order or garnishment, and of compelling the application of non-exempt assets or income discovered toward the payment of the amount due under the judgment." Ill. Rev. Stat. 1979, ch. 110, par. 73(1).

The Wage Deduction Act was first enacted in 1961 by an amendment to the Garnishment Act. (Ill. Laws 1961, at 1470, eff. July 1, 1961.) The amendment's effect was to create two separate garnishment procedures where previously wage garnishment came within the Garnishment Act. Sections 33 through 52 provide the garnishment procedure for all property other than wages, and sections 71 through 88 apply only to wages. Although the two acts are substantially similar in their provisions, the 1961 amendment made two significant changes. The amendment abolished the necessity of a written demand where the subject of the garnishment was wages (Ill. Rev. Stat. 1979, ch. 62, par. 82), and it changed the wage exemption from a fixed sum per week to 85 percent of gross wages earned during a maximum 30-day period. (Ill. Rev. Stat. 1979, ch. 62, par. 73, as amended by Pub. Act. 80-724, § 1.) The intention of the General Assembly in creating a separate procedure for the garnishment of wages has been interpreted in the following manner:

"It is obvious that in enacting the legislation relating to wage deductions, the General Assembly intended that the procedures be simplified, the costs held to a minimum, and the employee given every possible protection against harassment." Libby Furniture & Appliance Co. v. Nabors (1967), 86 Ill. App.2d 381, 385, 230 N.E.2d 28.

Also in 1961, the legislature amended subsections (1), (2), (4)(a), and (9) of the citation procedure to correspond to the separation of the Wage Deduction Act from the Garnishment Act. (Ill. Laws 1961, § 1, at 1445, eff. June 7, 1961.) The amendment, which inserted the words "a deduction order" in each of these subsections, plainly exhibits the legislative intent to interrelate the provisions of the citation procedure with those of the Wage Deduction Act.

The citation procedure allows the judgment creditor to summon into court "the judgment debtor or any other person to discover assets or income of the debtor not exempt from execution, a deduction order or garnishment." (Ill. Rev. Stat. 1979, ch. 110, par. 73(1).) The words "any other person" and "income" clearly indicate that the judgment debtor's employer is within the class of persons which may be summoned into court and examined pursuant to the citation procedure.

• 1 However, the statute later provides that once assets or income of the judgment debtor have been discovered, the court may "[e]nter any order upon or judgment against the person cited that could be entered in any garnishment proceeding." (Ill. Rev. Stat. 1979, ch. 110, par. 73(2)(d).) The question now becomes whether "any garnishment proceeding" ...


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