Wight v. Baltimore & Ohio Railroad

Oeeutt, J., delivered the opinion of the Court. The single question presented by this appeal is whether chapter 399 of the Acts of 1906, codified as sections 11 to 17 inclusive of article 8 of the Code of P. G. L. of Md., conflicts with any provision of the State or Federal Constitution, and that question arises in this way: On duly 30th, 1923, the Baltimore and Ohio> Eailroad Company owed Wm. L. Miller, one of its employees, $21.50 in earned wages and on that day Miller offered to sell and assign his claim for that amount to the appellants in this case for $20. They accepted his offer and he accordingly assigned the claim to them, and they paid the $20 to him and notified the railroad company, which at that time owed Miller ⁶⁹ ail amount equal to the claim of $21.50 of the assignment, but that company refused to recognize it and informed the appellants that it would pay Miller the whole amount due him as though it had not been made.

The appellants thereupon filed in the Circuit Court of Baltimore City a bill of complaint against both Miller and the railroad company, in which they set out the facts referred to, with other facts not material to' the question before us and which need not be further referred to here, and in that bill they asked for the following relief: “(a) Discovery as to the said defendants and each of them and that they be required to discover the entire earnings of the said defendant, Miller, in the capacity of brakeman for the month of July, 1923. “(b) That the said court may assume jurisdiction over said fund and determine the rights of the parties hereto. “(c) That the plaintiffs may have a decree in ‘per-sonam, against each of said defendants for said sum of $21.50.” The defendants answered the bill severally, and in their answers among other things they averred that the assignment upon which the appellants relied was not made in accordance with the requirements of sections 11 to 1Y of article 8, C. P. G. L. of Md., and was consequently void. There were other allegations of fact in the answer which under the pleadings are not material to this inquiry and are not before us, and will not therefore be considered. The complainants demurred to so much of the answer as relied upon the statute referred to, on the ground that it violated both the State and Federal Constitutions and was void; and as to the remaining averments of fact in said answer they joined issue. So that the whole case finally turns upon the constitutionality of that statute, since it conclusively appears that the assignment does not comply with its terms and that if the act is valid the assignment is for that reason invalid.

That act added eight new sections to the 8th article of the C. P. G. L. of Maryland entitled “Assignment of Choses in ⁷⁰ Action,” numbered 11 to 18. Sections 11-12-13, read as follows: “Section 11. No assignment of wages or salary shall be valid so as to vest in the assignee any beneficial interest, either at law or in equity, unless such assignment be in writing, signed by the assignor and acknowledged in person by him or her before a justice of the peace in and for the city or county, as the case may be, in which the assignor resides, and entered on the same day by said justice of the peace upon his docket; and unless further, within three days from the execution and acknowledgment of said assignment a true and complete copy thereof, together with the certificates of its acknowledgment, be served upon the person, firm or corporation by whom said wages or salary are due or to become due, in the same manner that the summons in chancery is now required by law to be served; provided, however, that no assignment of wages or salary by a married person shall be valid unless the same is also executed and acknowledged as above by the assignor’s wife or husband, as the case may be. “Section 12. That proof of said service, as provided for in the preceding section, shall be by admission thereof in writing by the person, firm or corporation, his, their or its agent, on the original assignment, which admission of service shall also be entered by said justice of the peace upon his docket within two days thereafter. “Section 13.

That in addition to said acknowledgment to be made by said assignor, he or she, as the case may be, shall make affidavit that he or she has not paid, and will not, directly or indirectly, pay more than the legal rate of six per centum per annum on any sum borrowed, or permit a deduction from said sum so loaned to him or her at the time of said loan, or any time thereafter, of more than a sum equivalent to six per centum per annum for the time said loan is made.” ⁷¹ Section 14 defines the term “assignment”; section 15 deals with the effect of usury in connection with assignments under the act; section 16 refers to the assignment of future earnings, and section 11 prescribes and defines the consequences resulting from a violation of the act, as well as the remedies which may be pursued in such a case. We have said that the assignment was not executed in compliance with the terms of the act and that conclusion is inevitable from a comparison of its terms with those of the act. The assignor signed and sealed an application which in part read as follows: “Application to Sell an Undivided Interest in My Account for Wages or Salary. * * * “I hereby make application to sell to Baltimore Finance Oo. an undivided interest in an account due me by my employer for wages or salary already earned during the months of July, 1923, in the capacity of brakeman, * * * “This transaction is an absolute and unconditional sale, and not a loan or advance of money, and is not a discount; I am not a debtor to the purchaser; this is an original transaction, and is not a renewal or extension of any kind. I agree to take 20 dollars for said account and hereby authorize the purchaser, in my name and stead, and as my attorney in fact, to sign any and all checks, vouchers, receipts and acquittances necessary and proper to be signed in order to collect said account.” The “assignment,” which is also under seal, and signed by the assignor, but neither acknowledged nor sworn to, contains in part these statements : “For value received, I hereby sell to Baltimore Finance Co., doing business in the City of Baltimore, Maryland, an undivided interest in my account for salary or wages, already by me earned during the month of July, 1923, said interest amounting to $21.50 and due me by Baltimore & Ohio R. R. Co., my employer.

I hereby direct my said employer to pay tr Baltimore Finance Co. said amount. * * * ⁷² “Tbis is an absolute and unconditional sale of an undivided interest in said account, and is not a loan or advance of money, and is not a discount; I am not a debtor to the purchaser; this is an original transaction, and is not a renewal or extension of any kind. * * H* “I hereby authorize the purchaser of this account, in my name and stead, and as my attorney in fact, to sign any and all checks, vouchers, receipts and ac-quittances necessary and proper to be signed in order to collect said account and to evidence the payment of the same.” These two documents appear to constitute a somewhat ingenious, very sincere and needlessly elaborate effort to> eeape the provisions of the act in question. But as the assignment is obviously within the scope of the act, the appellant’s contention that it is valid rests necessarily upon the propositions (1) that the act itself is unconstitutional and, in support of that contention, they say: “So far as it deals with the claims for wages or salaries actually earned, it is clearly an unwarranted interference with the owner’s liberty of contract and right of property; and is void under the ‘due process’ guaranty of our fundamental law”; (2) that the provisions of the act are impossible of performance, and (3) that it has been repealed by implication by the passage of the Petty Loans Act. This act is remedial in character and its apparent purpose is to throw around transactions such as that involved in this case such safeguards as will protect the wage earner who may be a party to them from the greed and the rapacity of unscrupulous persons wlm might exploit his necessities and misfortunes to his loss and their profit. . That purpose is certainly within the police power of the State, and the only question open is whether in its attempt to effect that purpose the Legislature has in this act. violated any of the privileges secured to the citizen by the guaranties of the State or Federal Constitutions.

And in dealing with that question we cannot disregard the consideration that .any act designed ⁷³ to accomplish such a purpose must be sufficiently definite and comprehensive in its- selection of the means and methods designed to effect it to frustrate the energy and ingenuity of the class at whom it ÍS' aimed, who so often regard the privilege of exploiting the necessities of borrowers as a vested property right. And while there should be no paltering with any real .assault upon the rights, privileges and immn nities guaranteed to the citizen by tbe Constitutions of this State or of the United States, on the other hand there can be no justification for resorting to strained, forced, technical, or tenuous reasoning in the construction of those charters in order to strike down an act of the Legislature passed in the, ostensible exercise of the police power of the State and in the public interest. The first concreto objection to the act is that it deprives the appellants of their property without due process of law. But the force of that objection is not apparent.

The act took from the appellants no property, unless the business of buying without regulation or restraint wages at a discount, is property. And while, under1 the facts of this case, we know of no definition of “property” which could include that privilege, yet if that privilege could he considered property, the appellants were not deprived of it without due process' of law, whether we assume that the word “property” relates to the particular assignment involved in this case or to the privilege of buying such assignments generally as a business. Because there is nothing in the act which purports to affect rights acquired in transactions prior to its passage, and all transactions after its passage were carried on with knowledge and notice of its existence and subject to its terms. These principles are in accord with the general trend of judicial authority and may he regarded as established.

Nor while the right to pursue any lawful occupation or calling1 is generally if not universally recognized as property within the “due process” clause of the Federal Constitution, yet on the other hand the right of the State to regulate such a business when its unregulated operation may injuriously affect the welfare of others is equally well settled. For, as s,aid in Schaake v. ⁷⁴ Dolley, 85 Kan. 600 : “The right to liberty and the pursuit of happiness includes the right to' employ one?s faculties and property in a gainful occupation of his own choosing. This right, however, has never been regarded as absolute by either the English or the American law. While it is properly spoken of as fundamental and inalienable, it is nevertheless qualified to the extent that the sovereign power may interfere with its enjoyment through regulations necessary or proper for the mutual good of all the members, of the social whole.

One of the highest ends of civil government is the protection of the individual in tire enjoyment of the fundamental rights enumerated in the Bill of Eights. The idea of those rights should be pervasive in civil institutions or government is likely to become a nuisance and a scourge. But if- the individual insist upon them to the detriment of other individuals possessing the same rights, or to the detriment of the security, good order, common good, and general welfare of the entire social body of which he is a member, he is likely to become a nuisance.”