DR. A. SHAFI, Informant, v. HIS HONOUR JOHN H. MATHIES, Judge, Debt Court, Montserrado County and TONY EL HAROUNI, Respondents.
INFORMATION PROCEEDINGS.
Heard: October 25. 1995. Decided: January 25, 1996.
1. Any person who is arrested on a writ of execution or in a civil action arising out of a claim in debt or contract or for damages, except damages for personal injuries or injuries to the reputation or domestic relations of the claimant, may declare himself insolvent and apply for leave to assign his property for the benefit of his creditors
2. For the court to grant a voluntary assignment for the benefit of creditors, the application must be made after an arrest based on the service of a writ of execution arising out of an action of debt, and it must also be clearly established that the defendant had been insolvent during the 90 days immediately preceding the assignment date.
3. The law granting a judge the right to rescind his ruling during term time imposes an obligation which should not be violated.
4. A term of court is the space of time intervening between the first day fixed by law for the meeting of any court and the first day fixed by law for its next meeting.
Judges are required to respect the Supreme Court’s mandate and comply with its orders without delay.
Informant commenced an action of debt against Co-respondent Tony El Harouni in which judgment was entered in his favor. In an attempt to stay the execution of the judgment, Co-respondent Harouni petitioned the Chambers Justice for a writ of prohibition. Upon the denial of the petition, the petitioner appealed to the full bench.
The Supreme Court confirmed and affirmed the ruling of the Chambers Justice and mandated the debt court to enforce its final judgment. When the mandate was read in open court, counsel for Co-respondent Harouni requested the court to entertain the hearing of a petition for the voluntary assignment of his assets, which petition he had filed with the debt court while the prohibition case was pending in the Supreme Court. The request was denied by the trial judge on the ground that the court could not violate the mandate of the Supreme Court to collect the judgment debt with interest. Subsequently, Co-respondent Harouni filed a bill of information in the court repeating the averment of the petition, the hearing of which had been earlier denied. The trial judge heard the information, and in a ruling thereon rescinded his earlier ruling denying co-respondent’s first submission for hearing of his petition for voluntary assignment of assets for the benefit of creditors. In the latter ruling, the judge ordered the hearing of said petition. Contending that the ruling of the trial judge rescinding his former ruling on the submission was illegal, and that it was done out of term time, petitioner filed a bill of information before the full bench requesting that the co-respondent judge be required to comply with the mandate of the Supreme Court.
The Supreme Court, after a review of the records, found that the trial judge’s ruling rescinding his earlier ruling denying the co-respondent’s submission for the hearing of the petition for voluntary assignment of assets, was done out of term time and was therefore void ab initio. The Court also declared void ab initio the hearing conducted by the trial court for the voluntary assignment of the co-respondents assets, using as the ground therefor that it was not in conformity with the statutory requirements. The Court held that even though it is legal for a person arrested on a writ of execution or in a civil action arising out of a claim in debt or contract or for damages to declare himself insolvent and to apply for leave to assign his assets, the statute, however, requires that the application be made only when the defendant is arrested on a writ of execution; or that the applicant has been insolvent 90 days before applying for permission to assign his property. The Court therefore granted the information.
Appearances not indicated.
MR. JUSTICE BADIO delivered the opinion of the Court.
Dr. A. A. Shafi, informant, instituted an action of debt against Tony El Harouni. A judgment was entered in his favor, a bill of costs issued, taxed, served and returned by the sheriff of that court. At the point of enforcement of the judgment, Co-respondent/defendant El Harouni petitioned the Chambers Justice for a writ of prohibition. The petition was heard and denied and an appeal taken therefrom to this bench en banc.
The appeal was heard by the full bench and the ruling of the Chambers Justice confirmed and affirmed during the March 1995 Term. Subsequently, on August 8, 1995, a mandate was sent to the debt court for enforcement of the judgment. Incidentally, on October 26, 1994, while the prohibition was pending before the Chambers Justice, Co-respondent/appellant Harouni filed a petition in the debt court for the voluntary assignment of his assets for the benefit of his creditors. This petition was not heard. However, on August 9, 1995, when the Supreme Court’s mandate was read in open court, Co-respondent Harouni’s counsel made a submission on the minutes of court, to the effect that a petition for voluntary assignment of Harouni’s assets for the benefit of creditors was filed, and he accordingly requested a hearing. The submission was denied on the ground that the court could not violate the mandate of the Supreme Court which ordered the lower court to collect the judgment debt of $29,190.00 with interest. The judgment was therefore ordered enforced. At the service of the bill of costs, Appellant Harouni requested an out of court payment of $3,000.00 against the bill of costs, but the informant was advised that such payment should be made through the court. On August 11, 1995, Co-respondent Harouni filed a bill of information in the debt court repeating the averments of the denied submission. On October 4, 1995, after a hearing, Judge Mathies rescinded his previous ruling made on the submission, as recorded on August 9, 1995, and ordered that the hearing on the submission for the assignment of assets for the benefit of creditors be proceeded with. Informant Shafi contends that the judge’s ruling rescinding his former ruling on the submission was illegal since it was done out of term time. He therefore filed a bill of information before this Court requesting that the co-respondent judge be required to comply with the mandate of this Court and enforce its judgment without delay.
For his part, Co-respondent Harouni contends that the judge’s act, in rescinding his previous ruling of August 9, 1995, was legal and done within term time since indeed that court’s final judgment had not been enforced. He also contends that the insolvency proceeding was instituted to facilitate the court’s determination of whether or not he was solvent and in fact capable of paying the judgment debt. Even though Co-respondent Harouni’s returns admit acknowledging the bill of costs, he however requests that the information be denied and that the judge be ordered to proceed with the insolvency proceeding to determine his ability or inability to pay.
The law under voluntary assignments for benefit of creditors provides that “any person who is arrested on a writ of execution or in a civil action arising out of a claim in debt or contract or for damage (except damages for personal injuries or injuries to the reputation or domestic relations of the claimant) may declare himself insolvent and apply for leave to assign his property for the benefit of his creditors.” 1956 Code, 7:202 (previously § 802).
It is a common experience that the law on voluntary assignment for benefit of creditors is intended to reduce and ease the financial burden of a debtor whose non-exempt personal property is insufficient to pay his debt. The law provides, however, that to avoid any degree of fraud, the application must be made after the service of an arrest on a writ of execution arising out of an action of debt. Also, it must be clearly established that the defendant had been insolvent during the 90 days immediately preceding the assignment date. Except these provisions of the law are implemented and conformed to, any arbitrary exercise or process should be disregarded and disallowed as such action is contrary to the basic intent of the law writers and the deep-rooted purpose of that law. There are limiting factors inherent in this particular law and they require that the application be made only when the defendant is arrested on a writ of execution, that is, an arrest in a civil action arising out of a claim in debt or contract or for damages; and it must be well established that the applicant had been insolvent at least 90 days before applying for permission to assign his property for the benefit of his creditors. These statutory requirements were apparently not adhered to when, on October 26, 1994, the co-respondent filed a petition for voluntary assignment of his assets for the benefit of creditors. That petition was filed while the prohibition proceedings were still pending before the Chambers Justice and when no arrest on an execution warrant had been issued against the petitioner. The attempt was therefore contrary to the provision of the statute which requires that the application be made only when the defend-ant is arrested on a writ of execution. Interestingly, on August 11, 1995 the respondent/defendant filed a bill of information before that court repeating his submission of August 9, 1995, to the effect that a petition for voluntary assignment of assets for the benefit of creditors was still pending undetermined and that the court suspends the enforcement of the Supreme Court’s mandate until the petition was heard to determine whether or not Tony El Harouni, the defendant, had sufficient assets to satisfy the execution of the court’s final judgment.
It must be observed here that the laws cited in this opinion are conclusive and definite. The law on voluntary insolvency prevails, if it is exercised consistent with the requirement and procedure provided by statutes. It is there-fore left with the respondent to commence his insolvency proceedings, if his insolvency declaration, as outlined in his petition before the debt court, is conscientious and not intended to baffle justice.
We repeat that the application was made by Co-respondent Harouni when the conditions were not adhered to, as there was no explicit indication of insolvency within 90 days before that application was filed. Also, the co-respondent was not exposed to any civil arrest. We therefore consider that it was ultra vires for the debt court judge to attempt to entertain the particular petition and that if any judicial hearing was conducted under that cloud of blunder, then that action was arbitrary and is hereby declared void ab initio.
Our attention was called to the judge’s ruling of October 4, 1995 rescinding his ruling of August 9, 1995, and which informant contends was rendered out of term time and therefore illegal or void ab initio. In construing the law which dictates that a judge may rescind his ruling during term time, it must be noted that the law imposes an obligation or strict rule which should not be violated. The Judiciary Law provides that the debt court shall sit every month and commence a term on the 2nd Tuesday of each month, which means that the court must begin its term on the second Tuesday of that month, that is, the next day after that second Monday. The statute defines “term of court” as follows: “A term is the space of time intervening between the first day fixed by law for the meeting of any court and the first day fixed by law for its next meeting. 2 LCL 721, ch. II, § 221. Therefore the judge’s October 4, 1995 ruling rescinding his August 9, 1995 ruling was done out of the term time of that court and was therefore void ab initio.
We must re-emphasize that judges are required to respect the Supreme Court’s mandate and comply with its orders without delay. Richardson v. Perry, 14 LLR 7, 11(1970).
In view of the foregoing, the information is hereby granted and the Clerk of this Court is hereby ordered to send a mandate to the debt court informing the judge presiding therein to resume jurisdiction over the case and give effect to this judgment. Costs of these proceedings are disallowed. And it is hereby so ordered.
Information granted.