[155 NJSuper Page 122] This matter is before the court on the motion of petitioner Eva Erickson seeking payment of $3,003 from funds in the hands of a receiver appointed by the court to oversee certain attached property of defendant Benjamin
Boymann. This money allegedly represents charges for unpaid rent and utilities due petitioner from defendant at the time of the removal of the attached goods and chattels by the receiver. This motion is opposed by the execution creditor, Farmers & Merchants National Bank of Bridgeton, on the grounds that petitioner is not entitled to a priority over the attached goods.
Defendant is insolvent. Petitioner is the owner of the premises wherein defendant formerly carried on his restaurant business. The bank obtained a writ of attachment against all the property of defendant after he defaulted on a demand note. On February 28, 1977 a general receiver over the attached property was appointed by this court. The attached goods remained on petitioner's premises until August 31, 1977, at which time they were sold by the receiver. Pursuant to a lease agreement entered into between petitioner and defendant, the rent amount was fixed at $150 a month, and defendant was required to pay for all utilities, electricity, heat and water services. However, for the period of June 1 through February 28, while defendant was in possession, no rent was paid, nor was any rent forthcoming for the period March 1 through September 9 while the receiver was in possession of the demised premises. In addition, petitioner was required to pay all utility, electricity, heat and water charges for the same periods since payment for same was not made by defendant or receiver.
Petitioner contends that she is entitled to payment of all outstanding rent and reimbursement for all utility bills before the attached goods and chattels can be removed from the demised premises. She rests her case upon N.J.S.A. 2A:42-1, which provides that no goods and chattels upon leased real estate may be taken by virtue of any process, including attachment and execution, unless the party suing out of such process pays the landlord all unpaid rent, not exceeding one year's rent, due from such premises at the time of the taking of such personalty by virtue of such process or
which shall have accrued up to the day of removal of the goods and chattels from the premises.
The creditor argues that although the statute gives the landlord a preference over other creditors of the tenant, such preference extends to unpaid rent only and is limited to an amount equal to but not greater than one year's rental value. The bank contends that the statutory preference for unpaid rent ceases when attachment occurs and that petitioner landlord is entitled only to unpaid rent as of the date of attachment. The bank further contends that the fuel and utility bills do not constitute rent and are not within the purview of this statute, and thus the landlord is not entitled to receive a priority over other creditors for these outstanding unpaid amounts.
The statute under which this claim is made was originally introduced into our law by the act of March 10, 1795, § 4 (Paterson Laws 164). That section is a copy of the English statute, 8 Anne, c. 14, § 1. Ryerson v. Quackenbush , 26 N.J.L. 236 (Sup. Ct. 1857); Central Bank of New Jersey v. Peterson , 24 N.J.L. 668 (Sup. Ct. 1855); Vezzetti v. Model Garage, Inc. , 119 N.J. Eq. 482 (E. & A. 1936). The underlying policy of this statute has remained unchanged since its inception. It is intended to give the landlord a specific lien on the tenant's property located on the demised premises against all executions to the extent of a year's rent. The statute however, does not give the landlord a "lien" in the ordinary and proper sense. It gives him merely the right to a preference in payment, out of the tenant's goods and chattels on the demised premises, over other creditors, including those holding executions, who are not lienholders. In Re Spies-Alper Co. , 231 F. 535 (D.C.D. N.J. 1916), Central Bank of New Jersey v. Peterson, supra. The statute leaves the tenant at perfect liberty to dispose of his goods and chattels absolutely, yet as between the landlord and
other creditors of the tenant, when such creditors come armed with any process whatsoever, the statute is the landlord's shield. It absolutely forbids the removal of the tenant's goods until the rent then due, subject to the one-year limitation, is paid. Although the landlord has no lien by which he can enforce the payment of rent, but must institute proceedings in his own behalf in order to accomplish that, the law preserves to him, as against every other process, the retention of the goods upon the premises until the rent be paid. Wood v. McCardell, West & Farrell Carriage Co. , 49 N.J. Eq. 433 (Ch. 1892).
Agreeing with the construction given our statute the court in In re Waldstein Co. , 24 F. Supp. 747 ...