Missouri Tie Lumber Co. v. Sullivan , 275 Mich. 26 ( 1936 )

The statute, 3 Comp. Laws 1929, § 14902, subjects the State of Michigan to process of garnishment as follows:

"All corporations of whatsoever nature, the State of Michigan and every county therein, may be served and proceeded against as garnishees in the same manner and with like effect as individuals under the provisions of this chapter and the rules of law relative to proceedings against corporations."

The two cases at bar present the question whether the plaintiffs, being judgment creditors of the State of Michigan, may legally collect such judgments by garnishment proceedings against the funds and property of the State of Michigan.

Plaintiffs sued Henry W. Sullivan, an employee of the State, and obtained judgments, upon which they sued out writs of garnishment against the State of Michigan under the mentioned statute. The State failed to make disclosures and judgments passed against the State. Upon these judgments against the State, writs of garnishment were sued out by the plaintiffs against the Old Kent Bank to reach State funds there on deposit. The bank made disclosures of having State funds and the court entered judgments upon the disclosures, overruling the motion of the State to dismiss the writs.

The judgments against the State of Michigan, on its liability as garnishee of Sullivan, are not here questioned, but the collection of these judgments by garnishment of State funds in a depository of the State is questioned.

Does the statute, subjecting the State to process of garnishment upon judgments against others, extend beyond entry of judgment against it as a garnishee and admit of further garnishment process thereon in attachment of State funds in a depository?

Garnishment is, in purpose and effect, in the nature of attachment. Posselius v. First National Bank — Detroit,264 Mich. 687 (90 A.L.R. 342).

The general statute relative to garnishment permits execution to issue upon a judgment against a garnishee defendant.^* No execution can issue against State property or funds. So held inCarter v. State of Louisiana, 42 La. Ann. 927 (8 So. 836, 21 Am. St. Rep. 404), where the legislature had authorized a party to sue the State.

In Westinghouse Electric Manfg. Co. v. Chambers, StateController, 169 Cal. 131 (145 P. 1025), it was held, quoting syllabus:

"A judgment against the State, in cases wherein the State has permitted actions to be maintained against it, merely liquidates and establishes the claim against the State, and, in the absence of an express statute so providing, such judgment cannot be collected by execution against the State or its property, or by any of the ordinary processes of law provided for the enforcement of judgments."

It is elementary that the sovereign State is immune from process of its own courts, except as specifically authorized by statute. The court had power to enter the judgments against the State but no power to enforce payment thereof through garnishment of State funds in a depository. Upon the judgments against the State for its liability as garnishee no direct levy could be made upon State funds, credits or property to obtain satisfaction thereof. This being true, may the funds of the State or credits in a State depository be attached by garnishment? An affirmative answer must rest upon implication, drawn from the permission to make the State a garnishee. A negative answer is predicated upon other applicable law and prescribed method for collecting obligations of the State.

Upon obtaining their judgments against the State plaintiffs were remitted, by law, to collection thereof through presentation of such adjudged liability to the board of State auditors and could not treat the State like a principal judgment debtor and sue out writs of garnishment to reach State funds or property in satisfaction of the judgments.

The Constitution of 1908, art. 6, § 20, provides:

"The secretary of State, State treasurer and commissioner of the State land office (superintendent of public instruction) shall constitute a board of State auditors. They shall examine and adjust all claims against the State not otherwise provided for by general law.

Section 264, 1 Comp. Laws 1929, sets up machinery for settlement and adjustment by the board of State auditors of all debits, credits, claims and demands against the State.

Garnishment cannot be permitted to serve in place of audit and duly authorized warrant in the disposition of State funds.

The writs under consideration constituted ancillary process upon the judgments against the State. This should not have been permitted, and the court was in error in refusing to dismiss the writs.

The judgments against the Old Kent Bank are reversed and the writs of garnishment dismissed, with costs against plaintiffs.

NORTH, C.J., and FEAD, BUTZEL, BUSHNELL, and EDWARD M. SHARPE, JJ., concurred with WIEST, J.

^* See 3 Comp. Laws 1929, § 14886. — REPORTER.