On appeal from Superior Court of New Jersey, Law Division, Salem County, Docket No. L-109-01.
Before Judges King, Braithwaite and S.L. Reisner.
The opinion of the court was delivered by: Braithwaite, J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
The issue on appeal is whether a judgment debtor who pays more than twenty-five percent of his wages to his ex-wife and children, pursuant to a garnishment, may be compelled to pay a judgment creditor in installments pursuant to N.J.S.A. 2A:17-64.
We hold that he cannot and therefore affirm the order of the Law Division.
The facts necessary to resolve this appeal are not in dispute. Both plaintiff Masud Iqbal and defendant Wayne Mucci are physicians. Plaintiff sold his medical practice to defendant. Defendant breached the agreement and plaintiff filed suit. The suit resulted in a judgment of $200,503.63 in favor of plaintiff.
Following the entry of judgment, plaintiff moved to compel defendant to pay the judgment in installments pursuant to N.J.S.A. 2A:17-64. At the time of the motion, defendant was employed by Accent Head and Neck Group, P.A., and National Steel Rule, Inc. Defendant receives wages from both employers and his disposable bi-weekly earnings are $4,174.66. Defendant's earnings, however, are subject to a wage execution in the bi weekly amount of $1,422. The sum is for the support of his ex-wife and children pursuant to a judgment of divorce and amended order of May 9, 2003. The wage execution amount is greater than twenty-five percent of defendant's disposable income. See U.S.C.A. §1673.
Plaintiff's motion to compel defendant to pay plaintiff's judgment in installments was filed on May 16, 2003. The motion was opposed. The judge relied on Household Fin. Corp. v. Clevenger, 141 N.J. Super. 53 (App. Div. 1976), in denying plaintiff's motion for an order to pay his judgment in installments.
On appeal, plaintiff contends that: (1) we owe no deference to the trial judge's interpretation of the law; (2) an order pursuant to N.J.S.A. 2A:17-64 is not a garnishment and therefore federal law does not bar the entry of the order he seeks; and (3) the judge erred in denying his motion.
We begin our discussion by observing that the property plaintiff seeks to obtain from defendant by way of installments is his wages. N.J.S.A. 2A:17-64 provides as follows:
If it is made to appear that the judgment debtor is entitled to, or is in receipt of, an income or any property or money or things in action, or rights and credits, including such income as is derived from federal, state, county, municipal or other governmental sources, but not income or property as is recovered or exempt by law, the superior court may direct the judgment debtor to make payments at stated periods in installments, and upon such terms and conditions as the court may direct, out of the same, on account of the unsatisfied judgment. Application may be made at any time on behalf of the judgment creditor, his executor, administrator or assignee, or the judgment debtor, to modify the terms of such order, and the court may make such modification.
The provision allows the court to direct the judgment debtor, here defendant,"to make payments at stated periods in installments" out of"rights and credits." Ibid. The definition of rights and credits includes wages. N.J.S.A. 2A:17-57.
Despite the ability of a creditor to get installment payments toward his judgment from wages, federal law sets limits the"maximum part of the aggregate disposable earnings of an individual for any work week which is subjected to garnishment may not exceed... twenty-five per centum ...