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State v. United States Steel Corp.

Decided: March 16, 1953.


On appeal from the Superior Court, Chancery Division, whose opinion is reported in 19 N.J. Super. 274.

For affirmance -- Justices Heher, Oliphant, Wachenfeld and Burling. For modification -- Chief Justice Vanderbilt, and Justices Jacobs and Brennan. The opinion of the court was delivered by Oliphant, J. Heher, J. (concurring). William J. Brennan, Jr., J. (dissenting in part). The Chief Justice and Justice Jacobs join in this dissent.


[12 NJ Page 40] This is the appeal of a judgment resulting from a proceeding instituted under the Escheat Act, N.J.S.A. 2:53-15 et seq., as amended by L. 1951, c. 304, p. 1093, and was certified here pursuant to Rule 1:5-2 on petition of defendant-appellant, 10 N.J. 21 (1952). The cause was heard in the Superior Court, Chancery Division, before Judge Goldmann, the judgment of which court escheated certain preferred and common stock of the defendant-appellant, the whereabouts of the owners of which had been unknown

to it for 14 years prior to the institution of the proceeding, and the dividends on the stock payable more than 14 years prior to the commencement of the proceeding; but the judgment below determined that the dividends declared and payable less than 14 years before the suit was instituted were not escheatable under the act.

Two questions are presented on the main appeal. The first relates to the sufficiency of the notice given in this proceeding as required under N.J.S.A. 2:53-21, as amended by L. 1951, c. 304. The second question relates to whether the mailing of the dividend checks by the appellant pursuant to certain dividend orders filed by the claimants, was sufficient to transmute the right to payment of the dividends into a claim on the said checks with the result that the claims would be barred by the statute of limitations and therefore not be escheatable.

These proceedings were instituted on November 3, 1948, under the provisions of L. 1946, c. 155, p. 713, then in effect. The defendant-appellant filed an answer as permitted by the statute and the proceeding was then stayed pending the final determination in State v. Standard Oil Co., 5 N.J. 281 (1950).

On June 28, 1951 the plaintiff-respondent obtained an order of publication fixing the time and place of the final hearing, in the form and conditions for publication of notice required by the statute, N.J.S.A. 2:53-21 (section 7 of the act of 1946). The order fixed the date of hearing as September 7, 1951, and further required that the notice of the time and place thereof should be published three times a week in a newspaper in general circulation in Mercer County, and directed that any person claiming any interest or ownership in the stock should file his claim with the court not later than five days prior to the date fixed for hearing. The order was consistent with the requirements of the 1946 act as to the necessary notice. The Legislature in the interim had passed L. 1951, c. 304, which act did not become effective until it was approved by the Governor on July 13, 1951. The important difference between the amendment

and the existing act insofar as the question here presented is that the new act required the claims to be submitted to the court not later than three days prior to the date fixed for hearing. The effect of the amendment was to give two additional days in which to file the claims.

Notice and publication was had under the order of June 28, 1951, without any objection from the defendant-appellant here with respect to the possible application of the 1951 amendment, and it further expressly consented to two orders of the court, one made September 13, 1951, extending the time for filing claims until the further order of the court and expressly removing the obligation, if any, of the defendant with respect to any claims paid during the period from the operation of N.J.S.A. 2:53-15 et seq. On November 13, 1951 a further order was made extending the time for the presentation of claims until December 1, 1951. As the result of the notice given and the orders of extension the Steel Corporation paid to claimants $159,319.71 out of a total of $342,790.82 in dividends listed unclaimed, 52 of the original 90 shares of unclaimed common stock, and 4 of the original 17 shares of unclaimed preferred stock.

As to the question of notice, the appellant argues that if the amendment, L. 1951, c. 304, is valid, then the notice given in the case at bar is invalid for failure to comply with such amendment. The gravamen of appellant's complaint is that the 1951 act was in effect at the time the notice was given and is therefore applicable to this case, and if applicable the claimants were entitled to two additional days in which to file their claims prior to the date of hearing, since the amendment fixed the last date for filing claims as three days before the hearing rather than five days as fixed in the original act. The appellant concedes the original Escheat Act, L. 1946, c. 155, was valid.

We are in accord with the conclusion of the trial court that the order of June 28, 1951 met the requirements of the statute at the time the order was made and that the question of the application of a particular statute on procedure is determined at the point in the proceeding at which

the existing law is applied, and that the time for decision as to applicability is when the order required by the statute for the publication and posting of notices was made, which was some three weeks prior to the effective date of the amendment when it was finally approved by the Governor on July 13, 1951.

The ordinary rule of construction is that a procedural statute is to be construed prospectively unless the legislative intent clearly indicates that a retroactive operation is intended, and so it has been held that the steps already taken, the pleadings, and all things done under the old law will stand unless an intent to the contrary is plainly manifest. Pending cases are only affected by general words as to future proceedings from the point reached when the new law becomes operative. 2 Sutherland Statutory Construction (3 rd ed.), sec. 2212, p. 136; 59 C.J., sec. 701, p. 1174; Berkovitz v. Arbib & Houlberg, Inc., 230 N.Y. 261, 130 N.E. 288 at p. 290 (Ct. App. 1921). Cf. White v. Hunt, 6 N.J.L. 415 (Sup. Ct. 1798); Peacock v. Hammitt, 15 N.J.L. 165 (Sup. Ct. 1835).

It is not clear by what right the defendant-appellant as the custodian of the properties in dispute can raise the question of lack of notice insofar as the individual claimants are concerned or how it has been prejudiced, in view of the fact that it on its own motion or order of September 13, 1951, expressly relieved it of any obligations to the claimants accruing under the Escheat Act. But assuming that such right possibly exists, then on the facts as they appear the appellant should be deemed to have waived such right: (1) by failing to move to amend the order of June 28, 1951, so as to conform to the new statute some time at or before the hearing date fixed in the order, and (2) by agreeing to the two orders extending the time for filing claims. McSweeney v. Equitable Trust Co., 127 N.J.L. 299 (E. & A. 1941).

Viewing the situation here presented as it exists on the facts without any regard to the specific notice provisions of the original statute or ...

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