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State v. Monaco

Decided: December 10, 1963.

STATE OF NEW JERSEY, PLAINTIFF,
v.
MADELINE MONACO, ADMINISTRATRIX OF THE ESTATE OF JOSEPH KENNY, DECEASED, DEFENDANT



Bennett, J.c.c. (temporarily assigned).

Bennett

The State of New Jersey recovered a judgment in this action against defendant administratrix on September 25, 1962 in the amount of $9,277.22 for the care and treatment furnished the decedent in the New Jersey State Hospital at Greystone Park. A writ of execution issued and the Sheriff of Union County has levied on the estate's funds in a savings account in the Union County Trust Company, Summit, New Jersey.

Defendant now moves for an order dismissing the State's levy, claiming these funds are exempt from levy under 38 U.S.C.A. § 3101(a), in that they consist of moneys received by the decedent in the form of United States veterans' pension payments.

The State, on the other hand, contends that the funds are not exempt from execution.

38 U.S.C.A. § 3101(a), provides:

"Payments of benefits due or to become due under any law administered by the Veterans' Administration shall not be assignable except to the extent specifically authorized by law, and such payments made to, or on account of, a beneficiary shall be exempt from taxation, shall be exempt from the claim of creditors, and shall not be liable to attachment, levy, or seizure by or under any legal or equitable process whatever, either before or after receipt by the beneficiary. * * *"

The issue is whether the moneys in the estate of Joseph Kenny, deceased, which came from a federal veteran's pension payable to decedent in his lifetime, are exempt from the judgment claim recovered by the State against the estate, because of the provisions of 38 U.S.C.A. § 3101(a).

Plaintiff claims that such pension moneys lose their identity as pension money on the death of the veteran, and that the exemption of such moneys from the claims of creditors is

thereupon lost. In support thereof State v. Wendt , 94 Ohio App. 440, 116 N.E. 2 d 30 (Ct. App. 1953), is cited. In that case a veteran was confined in the state hospital for the mentally ill where he remained for about two years until his death. At his death he had no assets except funds from accrued federal veteran's pension payments. The state made a claim on the administrator for his decedent's maintenance and support while in the hospital. The administrator claimed the funds were exempt from all claims of creditors under 38 U.S.C.A. § 454a (which contained the same statutory language as the present 38 U.S.C.A. § 3101(a)). The state then sued for a declaratory judgment. The court found that the statute did not exempt the funds from the claim of the state. It held:

"The exemption provided in Section 454a, Title 38, upon the death of the pensioner, where the pension payments are terminated, is not extended to the protection of the heirs or next of kin of the pensioner, as against the rights of the creditors of the pensioner. The statute does not expressly so provide and the court will not enlarge on its provisions by inference or construction. The fund held by the administrator in the instant case will be administered as other assets and distributed under the intestate laws of the State of Ohio."

In Estate of Buxton , 246 Wis. 97, 16 N.W. 2 d 399 (Sup. Ct. 1944), it was held that where the assets of a dead widow of a civil war veteran consisted of a pension paid to the dead widow's guardian, such assets were not exempt from the claim of the state for the care of the deceased while confined in an insane asylum. The court therein said:

"The purpose of this legislation, both federal and state, is for the protection of the veteran. No reference is made in either statute to the heirs or legatees of the veteran, and nowhere do we find ...


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