Petitioners Brief — Porter v. Aetna Casualty & Surety Co. (No. 604)

Office-Supreme Ceurt, U.S.

FILED

-2f, Ue

FEB 27 1962

JOHN F. DAVIS, CLERK

IN THE SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1961

No. 604

¢

Harry Cuirrorp Porter,

Petitioner,

AETNA CASUALTY AND SuRETY COMPANY,

Respondent.

IN WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

BRIEF OF PETITIONER

_

ErHe.sert B. Frey

3501 Rittenhouse St., N.W.

Washington, D. C.

Counsel for Petitioner

INDEX

PAGE

Petitioner's Brier

A aa AOI T aN 1

S| eM eNO RAO EITE i 3

ARRAS OS WE NETS NT RRM EON LUDO 3

I i as | 4

SUN TRIO. ccs cccslss sss sootendiincccleodoncisesnenseomaecemmannabioa 4

SEN INLD TIE NOTA tes LIONS OT i)

PIT IIIT, a disci cibatiscieasaclciipcaeasiiadateisinibcsanselaaadaagncinsaabisiedsn 7

United States Code, article 38 0. 4,8, 9,10, 11,12

BL EE TLE CORE ITP ARTE) Te Oe 18

TABLE OF CASES CITED “S

Appancose County v. Henke, et al., 207 Iowa 835 15

Atlantic v. Stokes (1939), 165 S.E. 27 11,15

Ballard Estate, 293 N.Y.S. 31 (1937) .................... - ii

Ballinger v. U.S. ex rel, Ness, 33 App. D.C. 308 ~ 6,8

Bellair Estate (1937), 293 N.Y.S. 31 2000000000000... 15

Buxtons Estate, 1944, 16 N.W. 2d 399, 246 Wis.

TN caiisiddiniascchasibbaanisteddaiitlaeiiaddipalialsaimadtaiiadiaimdipasdl 15

Carrier v. Bryant, 307 U.S. 545 (19389) oo. 10,12

De Rwiz v. De Ruiz, 66 App. D.C. 370 0 .. 10

Elvert Sales Co. v. Granite City Bank, 192 S.E.

Rf Reena Ree, Same i CU IRE ANIC RCS Ov OTR 15

Frizzell v. United States, 19 App. D.C, 48 —.......... 6,9

Heoppel v. Westover (1948), 79 F. Supp. 794 ... 11,15

International Stevedoring Co. v. Haverty, 272

“c.f Ee eee “13

Lawrence v. Shaw, 300 U.S, 245 (19387) oo... 11, 12, 15

pi. Aw (’: ee | | Rh a Oe 15

Rudolph v. United States, 1911, 36 App. D.C. 379 7

il INDEX

PAGE

Sanford v. Sanford, 52 App. D.C. 315 oe 10

Simon v. Simon, 58 App. D.C. 158.0000... 10

Surplus v. Remale, 1949, 87 N.Y.S. 2d 651, 194

BI, I Siac corrector issuinsdagtieecsetcincacd, 6

Towne v. Eismer, 245 U.S. 418 .0.....n..cccccccsccccscseesee 12

Trotter v. Tennessee, 200 U.S. 354 .........00....00..... 11,13

U.S. Trust Co. of N. York v. Helvering (1939),

OF I, eg FE We CI nds sacnessnticacccsnonovssssassvccins 11

United States v. Day, 27 App. D.C. 458 0... 6, 9

United States v. Goldenberg, 168 U.S. 95 00... 10

United States v. Moore, 95 U.S. 760, 763 0........ 6,9

United States v. Moyers, et al., 15 Fed. Rep.

SPIE SES AIRS ter A ee, le ASE OE PEAT Ne ERMAN UES G, 7,3

W ase, DC., Towa 1897, 81 F. 350 es... 6

Walton, et al. v. Cotton, et al., 60 U.S. 355, 15

ME Riri Nitty PI I aici cancettniccisanncssnmnecaccoigese 6,7

Williams v. U.S. Fidelity and Guaranty Co., 71

App. D.C. 9, 107 F. 2d 210 (1939) decided

MN 0k SUIS secretes ai evasuincstonnbecenl apeasucaiseoeasiald 6, 12, 15

Yoke v. Yoke (1936), 183 A. 555, 170 Md. 75 ........ 11, 15

STATEMENTS, RECENT AUTHORITIES CITED AND PHOTOSTATS

The statement of John E. Rankin of Mississippi

in House Report, 74th Congress ..00.00.00.00000.0..0. 8

Statement ffom Veterans Administration ............ 17

Case ef Arthur V. Kereoud, D.C. mental health

case-3$35-57 decided by Judge Keeth of United

States District Court of the District of Co-

Ung BPO EO wide ioccrcesecns scsteedatviccn 15

“Photostats and exhibits referred to in Brief ........ 19-26

IN THE SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1961

No. 604

Harry Criirrorp Porter,

Petitioner,

—YV\ moe

ArETNA CasuALTY AND Surety Company,

Respondent.

ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

BRIEF OF PETITIONER

Preliminary Statement

Petitioner, an ex-serviceman, and a patient at Saint

Elizabeths Hospital, by his committee and attorney, makes

this preliminary statement of the proceedings and what

happened up to the time of the filing of an appeal by the

respondent, Actna Casualty and Surety Company in case

#16066 of the United States Court of Appeals, District

of Columbia Circuit.

The Aetna Casualty and Surety Company on, to wit,

the 8th day of February, 1960, secured a judgment against

petitioner in the case of Actna Casualty and Surety Com-

pany v. Harry Clifford Porter in the United States District

Court for the District of Columbia, numbered 57-57; this

judgment was obtained on a so-called confession obtained

2

from Porter, who, at the time said confession was obtained,

was declared by several psychiatrists, Erwin Tiplin, cap-

tain of the United States Army Air Force (M.C.), Dr.

Amino Perretti and Dr. Joseph L. Gilbert (now deceased)

on the staff of Saint Elizabeths Hospital in 1952, to be

of unsound mind, not capable of knowing right from wrong.

Immediately after said judgment, petitioner, by his com-

mittee and attorney, filed an appeal in said action in the

United States Court of Appeals for the District of Co-

lumbia Circuit, which judgment after a hearing, was af-

firmed (this case in Court of Appeals is numbered 15664).

Thereafter the respondent, Aetna Casualty and Surety

Company filed an attachment February 24, 1960 and a

Motion for Condemnation thereafter on March 17th, 1960

of petitioner’s funds deposited in the Columbia Federal

Savings and Loan Association and the Prudential Building

Association in case #57-57, attaching the disability or

pension funds that petitioner’s committee received from the

Veterans Administration and which said committee had

deposited by order of Court from time to time in the Co-

lumbis, Federal Savings and Loan Association and the

Prudential Bldg. Association for the benefit, care, keep

and rehabilitation 6f said petitioner.

Petitioner’s committee and attorney thereafter on March

Ist, 1960, filed a Motion to quash the attachment and a

reply to the Motion for Condemnation in said case; after

a hearing in open Court and argument by counsel, the

attachment and Motion of Condemnation were denied, and

the Motior. to quash, filed by petitioner’s committee and

counsel, was granted by Judge Youngdahl July 14, 1960,

from which finding and order of said Court by Judge

Youngdahl, the respondent, Aetna Casualty and Surety

Company, appealed to the United States Court of Appeals

for the District of Columbia Cireuit, which appeal, num-

bered 16066 is before this Court.

3

After a hearing in this matter, two of the Judges of the

Court of Appeals reversed the District Court’s findings

and order; the third Judge dissenting (R. 47 to 54). There-

after petitioner, by his committee and attorney, filed a

Motion for a rehearing, en_banc, which was denied.

From the above ruling, petitioner (whose funds are at-

tached), by his committee and attorney “filed his petition

for Writ of Certiorari September 18, 1961 in forma pauperis

and which was granted December 11th, 1961, now before

this Court.

7

Opinions Below

The opinion of the Court of Appeals has not been re-

ported, but is contained in the record (R. 47-54).

The opinion of Judge Luther W. Youngdahl in case

#57-57, United States District Court for the District of

Columbia was written and filed in the matter July 14, 1960,

a copy of which is attached hereto and made a part of

record, transcript of record, pages 27 to 31 inclusive, as

well as the opinion of the Court of Appeals; majority

opinion and the dissenting opinion of: Judge Prettyman

was delivered July 13, 1961 (R. 47 to 54 inclusive).

Jurisdiction

The judgment of the Court of Appeals was entered on

July 13, 1961 (R. 55); a timely petition for a rehearing,

en banc, was presented, which was denied by said Court

of Appeals on August 21st, 1961 (R. 65), case #16066,

and thereafter a petition im forma pauperis for a Writ

of Certiorari was filed in this Court September 18th, 1961

and was granted December 11th, 1961.

Question Presented

When a Court appointed committee of an incompetent

veteran deposits disability benefits or pension funds by

an order of Court in a savings institution upon the agree-

ment between the committee and the institution that no

shares of stock were purchased, but that the money, so

deposited, could be drawn out the saime as a bank account,

upon the presentation of the deposit book, can such funds,

which have not changed their identity, be attached under

article 38 of the United States Code, sections 454 and 454A

by a judgment creditor?

The following citations cover source of various legislation

pertinent to the issue involved.

Act of August 12, 1935;

Act of October 17, 1940;

38 U.S. Code 454;

38 U.S. Code 454A ;

Senate report 1092—74th Congress, Ist session;

Senate report 16—74th Congress, Ist session. *

Statute Involved

The exemption statute, 38 U.S.C.A., section 3101, page

135 and sections 454 and 454A reads—

.

Payments of benefits due or to become due under any

law administrated by Veterans Administration, shall not

be assignable, except to the extent specifically authorized

by the 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 attach-

ment, levy, or seizure by or under any legal or equitable

5

process, whatsoever, before or after receipt by the bene-

ficiary (Act of Congress, August 12, 1935).

This law has not been changed or modified.

Statement

This is an attachment by a judgment creditor on the funds

under the control of a Court appointed committee that were

deposited from time to time by his committee in two

Savings Institutions, The Columbia Federal Savings and

Loan Association and the Prudential Building Association,

where they were deposited by order of Court and after

committee had understood that he was not purchasing

shares of stock, but depositing in said institutions the same

as in a bank and that they paid interest on said deposits

and said funds could be withdrawn at any time, the same

as a bank account by orupon the presentation of the deposit

book, and no notice was recessary (photostat copies of the

deposit books are attached hereto and show no purchase

of shares of stock was made).

At present, petitioner is not receiving any disability or

pension funds, as under a recent order of the Veterans

Administration, he, having at the time of the attachment

over Fifteen Hundred Dollars in deposits, His pension or

disability funds, were cut off completely, and that because

of the said attachment filed herein February 24, 1960, he

has no funds, whatsoever, even for the necessities of hfe

at said Hospital, where he is confined, and for medical

services or other personal necessities.

Petitioner’s money or pension funds so received by com-

mittee, was placed under rule 23, section A of the United

States District Court Rules, which made it mandatory for

his committee in the instant case, to withdraw funds from

time to time from the checking account and place them in

approved institutions which would draw interest and aug-

6

ment or increase said funds from time to time where such

funds would be readily available and could be drawn out

on demand for the veteran’s needs at any time upon the

presenting of the passbook without formal notice; that the

passbooks of said institutions or savings accounts show

no purchase of shares of stock, as will be shown by the

photostat copies of said entries, attached hereto and ex-

hibited and marked Exhibit Al-A2—B1-B2, which clearly :

show that uo shares of stock were purchased.

Petitioner, an indigent ex-serviceman, since liis funds

(disability or pension funds), have been attached, to wit,

February 24, 1960, asks this Honorable Court to determine

his constitutional rights under the law, U.S. Code, Title 38.

The majority opinion of the Court of Appeals in the instant

case proceeds upon the flagrant disregard of patient’s con-

stitutional rights; the United States Code, The Act of the

74th Congress, 1st session and the ruling held by the fol-

lowing cases:

Waite, D.C., Iowa 1897, 81 F. 359;

Williams v. U.S. Fidelity and Guaranty Co., 71

App. D.C. 9, 107 F. 2d 210 (1939) decided Au-

gust 7, 1935; *

Surplus v. Remale, 1949, 87 N.Y.S. 2d 651, 194

Mise. 1036.

A State or the District of Columbia cannot, by legislation

or judicial interpretation, alter or change pension legisla-

tion.

United States v. Moyers, et al., 15 Fed. Rep. 411;

Walton, et al. v. €@’otton, et al., 60 U.S. 355, 15

Law Ed. 653, page 359;

Ballinger v. U.S. ex rel. Ness, 33 App. D.C. 308;

United States v. Moore, 95.U.S. 760, 763;

United States v. Day, 27 App. D.C. 458;

Frizzell v. United States, 19 App. D.C. 48.

ARGUMENT

Petitioner Alleges That the Law Is Well Settled That a

State Cannot, by Legislation or Judicial Interpretation,

Alter or Change Pension Legislation.

It is also clear that although no one has a vested right

to a pension, these rights are vested as long as the statute

creating the pension remains in foree and unchanged, sub-

ject to be divested at any time that the legislature may

desire. Rudolph v. United States, 1911, 36 App. D.C. 379.

It is also evident that Congress, if inclined, could enact

legislation for the sole purpose of providing its intended

beneficiaries with its exclusive use and to prevent others

from ever benefiting from these specific funds. In the case

of United States v. Moyers, et al., 15 Fed. Rep. 411, the

Court, at page 417, in discussing the gratuitous nature of

the pension, stated:

“Then it is not a right; it is a bounty; and if the govern-

ment chooses to say that money shall ‘go absolutely to

the pensioner. irrespective of the claims of any creditor”

or anyone, it has a right to say so, and there is no

doubt that such is the policy of the legislation, and that

this is the State and Federal Courts, both of which

have ruled these points just as I am ruling now”.

The Supreme Court of the United States expressed sim-

ilar sentiment, in the case of Walton, et al. v. Cotton, et al.,

60 U.S. 355, 15 Law Ed. 653 (p. 359) :

“There can be no doubt that Congress had a right to

distribute this bounty at their pleasure, and to declare

it should not be liable to the debts of the beneficiaries.

But they will be presumed to have acted under the

ordinary influences, which lead to an equitable and not

8

to a capricious result. And where the language used

may be so construed as to carry out a benefit policy,

within the reasonable intent of Congress, it should be

done”.

The Act of August 12, 1935, supra, was called “An Act

to safeguard the estate of veterans derived from payments

of pension, compensation, emergency officers’ retirement

pay and insurance and for other purposes”.

Representative John E. Rankin of Mississippi in House

Report 16 of the 74th Congress, 1st Session, stated, refer-

ring to this Bill, on the floor of the House, in introducing

it, said it was: eee,

“Nothing in the world except a measure to throw around

the veterans, the safeguards, which I think every Amer-

ican would want thrown around the estate of insane

veterans” (70 Cong. Rec. 8556 (June 3, 1935)).

Since Section 454A, supra, amends Section 454 U.S.C.A.,

let us determine the object and effeci of this amendment.

Up to the amendment it appears that the exemption pro-

Visjon applied to all claims except those of the United

States.

In the case of Ballinger v. United States, ex rel. Ness,

33 App. D.C. 308, the Court said:

“In legislation of this kind, requiring the perform-

ance of administrative duties by the head of a depart-

ment to put it in execution, it is usual, as was done in

the foregoing statute, to confer the power to make ap-

propriate regulations for carrying the same into effect.

Such supplementary regulations have all the force of

law, if not in conflict with the law itself, or in plain

excess of its requirements.”

9

In United States v. Moore, 95 U.S. 760, 763, 24 L. Ed.

088, 589, the Court said:

-

“The construction of a statute by the department

charged with its administration made and uniformly

followed for a number of vears, is always entitled to

the most respectful consideration, and ought not to

be overruled.”

Following the same reasoning, the Court in United States

v. Day, 27 App. D.C. 458 said:

“A settled construction by a department of the govern-

ment of laws of the United States will not be over-

turned by the Courts unless clearly wrong.”

Frizzell v. United States, 19 App. D.C. 48;

United States v. Moyers, 15 Fed. Reports 411.

The Veterans Administration was especially created for

or concerned in the administration of laws relating to the

relief and other benefits provided by law for veterans, their

dependents and their beneficiaries.

Consequently great weight must be afforded the con-

struction of the statute by the Veterans Administration.

The Administrator of Veterans Affairs construed Section

454A, supra, T 38, in Section 15, 339, Code of Federal Regu-

lations of the United States of America as follows:

“Section 13, 339 (a), Section 3, Public No. 862, 74th

Congress (38 J.S.X. 454a), applies to payments made

to or on account of a beneficiary under the laws relat-

-- jing to veterans and exempts such payments, either

before or after receipt by the beneficiary, from the

claims of creditors, and provides that same shall not.

be liable to attachment, levy or seizure by or under

any legal or equitable process whatever. The language

° \ 10

of the Section has been construed by the Supreme Court

of the United States to the effect that such exemption

does not extend to property purchased such as real

estate, stocks and bonds, in which the proceeds of such

payments are or invested” (Carrier v. Bryant, 306 U.S.

545).

In De Ruiz v. De Ruiz, 66 App. D.C. 370, 88 F. 2d 752

(1936) the Court said:

“While it is the duty of the Court in interpreting legis-

lation ‘« ascertain, if possible, the intent of the legisla-

ture, we must not overlook the general rule of statutory

construction that such intent is to be found in the lan-

guage employed.”

In United States v. Goldenberg, 168 U.S. 95, 103, 18°

S. Ct. 3, 42 L. Ed. 394, the Court said, when the words used

are plain, they give meaning to the act, and it is neither the

duty nor the privilege of the Courts to enter speculative

fields in search of a different meaning.

Petitioner and committee contend that the language of

Section 454A, is plain and clear and not subject to specula-

tive interpretation.

Another well established rule of statutory construction

is that specific or special legislation, will prevail, when in

conflict with general law, Simon v. Simon, 58 App. D.C.

158, 2d F. 2d 530. A further extension of this general rule

was laid down in Sanford v. Sanford, 52 App. D.C. 315,

236 F. 777 wherein the Court ruled that general and spe-

cific provisions in apparent contradiction, whether in the

samé or different statutes, and without regard to priority

of enactment, may subsist together, the specific qualifying

and supplying exceptions to the general.

11

Petitioner holds that legislation, relative to pensions ben-

efits of veterans, 38 U.S.C.A, 454A, is special legislation,

affecting a specific class of individuals.

The payment of pensions or disability funds are intended

primarily for the maintenance, care, keep and rehabilita-

tion of said pensioner thereafter; they cannot be attached

by a judgment creditor.

The question presented by this case is whether the exemp-

tion applies to these accounts in the Columbia Federal

Savings and Loan Association and/or the Prudential Build-

ing Association, where the books show no shares were pur-

chased, whether the account is “property” purchased in

part or wholly out of such payments, rendering the exemp-

tion unavailable. In Trotter v. Tennessee, 200 U.S. 354

(1933) the Supreme Court held that lands purchased with

veterans’ benefits payments, were subject to taxation, the

benefits having lost their exempt status when they were

“converted into land and buildings,” WHICH COULD BE TRANs-

FERRED (290 U.S. 356).

In Lawrence v. Shaw, 300 U.S. 245 (1937), the Court held

that the deposit of veterans’ benefits in a bank did not

thereby render the funds non-exempt, as well as the follow-

ing cases:

Ballard Estate (1937), 293 N.Y.S. 31;

Atlantic v. Stokes (1939), 165 S.Ie. 27;

Yoke v. Yoke (1986), 183 A. 555, 170 Md. 75;

U.S. Trust Co. of N. York v. Helvering (1939), 59

See. 602, 307 U.S. 59; :

Heoppel v. Westover (1948), 79 F. Supp. 794.

These payments are intended primarily for maintenance

and support of the veterans. To that end, neither he nor

his committee is obliged to keep the monies on his person

or under his roof (300 U.S. at 250).

12

©

Accordingly, it has been held in this Cireuit that a check-

ing account is exempt. Williams v. U.S. Fidelity and Guar-

anty Co., 71 App. D.C. 9, 107 F. 2d 210 (1939) likewise a

savings account is exempt. But Mr. Justice Hotes has

instructed us:

“A word is not a crystal, transparent and unchanged;

it is the skin of a living thought and may vary greatly

in color and content according to the circumstances and

the time in which it is used.” Towne v. Eisner, 245 U.S.

418, 425 (1918).

Is money deposited in a savings account or in a building

association, which has not changed its identity, the same as

a bank account and which can be drawn out without a notice

on demand with passbook, exempt?

In Carrier v. Bryant, 307 U.S. 545 (1939), the Supreme

Court was asked to decide whether negotiable notes and

United States bonds purchased with veterans’ benefits by

a veteran’s guardian were exempt from execution on a

judgment against the veteran. The Court held the prop-

erty subject to execution, quoting from the Lawrence case

to the effect that:

“The provision of the Act of 1935 that the exemption

should not apply to property purchased out of the

moneys received from the government shows the intent

to deny exemption to investments in real estate, as was

ruled in the Trotter case” (306 U.S. at 550, quoting

from 300 U.S. at 250). (Emphasis suppiied.)

The statute there involved was 53 of the Act of August

12, 1935, ec. 510, 49 Stat. 607 which was not significantly

different from 38 U.S.C.S. 3101.

“Investment of trust funds, unless otherwise provided

in the instrument creating the trust, or except under

13

extraordinary conditions set forth fully to the Court,

will ordinarily be sanctioned only when made in the

obligations meeting the requirements herein set forth.”

And see International Stevedoring Co. v. Havertu, 272

U.S. 50 (1926). Because our local rules speak of a deposit

in a savings and loan association or building association

as an “investinent” does not necessarily mean it is an “in-

vestment”’. :

Section 3101 does not speak of “investment”. The stat-

ute speaks of any property purchased in part or wholly out.

of such payments. When Curer Justice Hycues used the

word “investment” in Lawrence v. Shaw, quoted above, he

was referring to the Trotter case. The only sentence in

Trotter case in which the word “investment” appears is

the following: Money invested in real estate is not exempt

(290 U.S. 351).

We see no token of a purpose to extend a like ruling

where money is deposited in a bank, a saving association

or building association, where it has not lost its identity as

in the instant case.

Diligent inquiry has been made with both building asso-

ciations in which the deposits were made and with other

like associations: all conclude and hold that such deposits

are money or funds, and not purchase of stock.

Where building and loan associations hold that such de-

posits are the purchase of “shares”, they still hold that such

deposits are cash or money and not stock.

The local Inheritance Tax Bureau also holds and treats

said deposits, upon the death of a decedent, as cash and;or

money, and not stock and treat it as such. So does the

Register of Wills Office of the District of Columbia.

14

Reading the word “investment” in the light of this state-

ment is quite noticeable; an immunity was not to extend to

permanent investments, As further clarification, the Court

SAID:

. . °

“* * * we think it very clear that there was an end to

the exemption when they lost the quality of moneys

and were converted into land and building” (290 U.S.

at 356) (emphasis supplied),

something that can be sold or transferred.

Moneys deposited in a saving association or building

association by the committee by order of Court of a veteran,

have not “lost the quality of monies’; they have not been

“converted” into “property”, as in this particular case; no

stocks or shares were purchased, but only deposited for

holding, as the books will show (copy of entry in books,

Exhibits A-1, A-2 and B-1,and B-2 and attached hereto).

Indeed, in Lawrence, bank deposits were held exempt

from taxation and after stating that it would be possible

“under a special agreement” for deposits to “assume the

character of investments,” the Court carefully pointed out,

“we do not suggest that a mere allowance of interest upon

deposits would be enough to destroy an immunity where it

would otherwise attach.” The important fa¢tor would ap-

pear to be not an overly legalistic conception of the nature

of the bank accounts, but rather the case with which “the

proceeds of the collection are subject to withdrawal; THE

SAME AS IN A BANK ACCOUNT.

That a depositor in a savings and loan or building asso-

ciation does not necessarily purchase shares, but is a credi-

tor-depositor of the association, is a matter of form, which,

in the opinion of the petitioner should have no bearing on

the resolution of the problem here involved—just as the

probability that a deposit in a checking account will not

15

receive on demand the specific money deposited, but rather

an equal sum of money in like kind, afforded no difficulty

to the Court in WituiAMs, supra. And see Elvert Sales Co.

v. Granite City Bank, 192 S.I. 66 (1937).

It simply was a draft upon demand for the veterans’ use

(300 U.S. at 250).

As a practical matter, a withdrawal from a savings ac-

count can be accomplished as quickly as a withdrawal from

a checking account—and this is true whether the savings

account is in a savings bank, savings and loan, or building

association. A checking account is immune; a savings ac-

count likewise, should be. Furthermore, the Congressional

purpose to immunize veterans’ benefits would indicate that

a liberal construction should be given the statutory grant

of immunity. See Mixon v. Mixon, 205 N.D. 566, 166 S.E.

516 (1932); Yake v. Yake, 170 Md. 75, 183 A. 555 (1936);

ef. Hoeppel v. Westover, 79 F. Supp. 794 (D.C. Cal. 1948).

The following cases hold that money (Veterans’ funds)

placed in bank or saving account is exempt.

Williams v. U.S. Fidelity and Guaranty Co., 19389,

107 F. 2d 210, 71 App. D.C.;

‘’ Bellair Estate (1937), 293 N.Y.S. 31;

Atlantic v. Stokes (1939), 165 S.E. 27;

In Re Guardianship Le Letourmen, exemption good

except to real estate and bonds;

Buxtons Estate, 1944, 16 N.W. 2d 399, 246 Wis. 97;

Lawrence v. Shaw, hereinbefore used, 300 U.S. 245.

In a recent case of Arthur v. Kercoud, mental health

case #35-57 in the United States District Court and de-

cided in December, 1959 by Judge Keech of our Court in

which he held that where pension funds were put or de-

posited ina building and loan association, it did not loose

their identity and were exempt and unattachable under

16

United States Code 28. And several of our other Courts

in this jurisdiction have decided the same.

In Appancose County v. Henke, et al., 207 Iowa 835, the

Court held that the co-mingling of pension money and in-

terest thereon, did not loose their identity and did not stop

the claim of exemption.

The purpose of the law and the order of Court is to pre-

serve the assets of the incompetent’s estate, and at the same

time, to receive some yield, thereby augmenting the assets

from time to time, all in the interest of the incompetent so

that when he is restored to normalcy mentally and dis-

charged as such, he will have some estate to take care of

himself during his rehabilitation in an orderly society and

not become a charge upon the community.

This being true, it is inconceivable to believe that a Court

would pass and enter such an order, knowing at the time

that such an order is an instrumentality of personal bene-

fit to a creditor of the incompetent if such funds on deposit

in banking institutions are attachable.

Should a committee fail or refuse to obey the mandate

of the Court, he would be subjecting himself in contempt of

Court, removal and other possible consequences. If the

committee knew that such deposits were attachable and

placed the funds in a safety deposit box, he would be ren-

dering a greater service to his ward than by obeying the

Court’s mandate as such funds would then be unattachable,

hut by so doing, he would, nevertheless, be subject to con-

tempt and removal, even though under the circumstances,

the committee would be rendering a fuller and greater ser-

vice to his ward than would the Court.

From the above comment and the primary purpose of

the law, heretofore cited, your petitioner cannot believe

17

that the Court would hold that such funds, which have

not changed or lost their identity, are attachable.

To hold otherwise, the purpose of the law and order of

the Court would be defeated.

The Veterans Administration herein alleges that’ over

one hundred and five thousand incompetent veterans, who

are under legal disability are dependent upon these com-

pensation benefits for their livelihood, care, keep, necessi-

fies and for rehabilitation purposes, and that of this date

said beneficiaries have estates in excess of $750,169,000;

nearing all of which were derived from veterans’ benefits

and deposited in interest bearing accounts in banks and

saving institutions; all of which would be subject to credi-

tors, attachments and liens, should this Honorable Court

allow the ruling of majority opinion of the United States

Appellate Court for the District of Columbia Circuit and

numbered 16066, stand.

The Exhibits in this case and asked to be read herewith,

are as follows: Exhibits A-1, A-2 and B-1, B-2 attached

hereto.

Petitioner says that from the reports of the doctors at

Saint Elizabeths Hospital, his mental condition has im-

proved to such an extent that shortly they will request his

release and discharge; this cannot be done for at present he

has no funds for rehabilitation purposes, but will still be

a charge of the United States Government, which claims

he owes them for care and treatment over Five Thousand

dollars at the present time. Committee received a letter

from the U. S. General Accounting Office, attached hereto,

marked Exhibit C, and asked to be read herewith. This

claim began to run against petitioner before the date of

judgment, February 8, 1960 and should have priority.

%

18

=

Conclusion

For the foregoing reasons and the law involved herein

it is respectfully submitted that the judgment of the Court

of Appeals Circuit of the District of Columbia, and num-.

bered 16066 should be reversed, and the order of Judge

Youngdahl of the United States Court for the District of

Columbia in case numbered 57-57 should be affirmed.

Respectfully submitted,

ErHevpert’B. FREY

Counsel for Petitioner

19

Photostats

Appellee’s Exhibit A-1 and A-2 is the record of initial

deposits in the Columbia Federal Savings and Loan Asso-

ciation.

Exhibit B-1 and B-2 is the record of initial deposits in the

Prudential Building Association.

~.

These Exhibits are attached hereto and follow this page.

Also attached hereto are Exhibits marked C-1 and C-2,

which are a letter from Winfred Overholser, M.D., Super-

intendent of Saint Elizabeths Hospital together with bill

for care and treatment of Appellee Harry Clifford Porter.

20

21

EXHIBIT A-1 EXHIBIT A-2

sinuepeeieamer comeaaer ese ‘ACCOUNT E- , SAVINGS ACCOUNT 3

No. 31337 Ne. 31337 ee

\ COLUMBIA FEDERAL SAVINGS AND LOAN ASSOCIATION ;

Cartifias that j | WASHINGTON 1, D. C.

te ; :

Ethelbert GB. Frey, Committee ——, DATE PAYMENTS WITHDRAWALS BALANCE,

of Harry C. Rorter MYITS5 | SOOO00 | 3,00 0.00¢

JAN 4.56 NDS 7.50 eet

. Jan 456 Petts 4 5:14 | | 3,05 2616

JAN 6 56 1,000.00 ee | 4052.61 +

holds a Savings Account representiny shore interes’s in Columbio Federal Te - 8 MECC 6 56 Bvt: 56. 7091 ‘ 4, 12 3, 52 «

ssociatio to its charter 9 laws. the Rules and Regulations for the ;

aan Sevir neg rom ane pa to "7 a of the Urited States of Americo nn Peden 1,0 0 0.00 ; a} eee

COLUMBIA FEDERAL SAV'NGS AND |O4N ASSOCIATION ' DEC 27 57 a 4 5:35 | So 5 9 5 6 CF

) DEC 27 57 2. Ned Ss, :

JIN ag PUR 2 E-PS | 23 3 E45 %

SS-6S3tf

pan: > Rt ay mtg: mas ee —— enna =}

Wwe SSes il 5.5 72146

V5 2

Meee 2232295 392 982 2g Zz was so Wiss 4 8.76 . |s62090m

ey cof ates 85 aza at : 1960 pv2i9 56.20 5,6 7 7.10 CF

8 Pe ee3es's “3385. a ~ — JAN 19 60 pv359 S 6.77 5,733.87 &

S Shenae E S$ 28,5 _ 20m JANI 60 pvs5SI 5 7.33 5,7 91.20 Ca

© QO28R33°72§ 9° 3203 < < 9 -

P get ick GL feeeh Fe

69 8238803 e isBes -. « ,

sce Si5gic3 FteSee “¥0 :

> "t £5 § Ae ae ee .

BS weet 3 BR ee rere ao” ‘J

z g £55538" wet Ceo eels, . ;

goo. 88: adie & ee ps :

ee et Fee ed ee 5 .

. Z Besec3 46. £82. _ =

+] ee re si —* : = P

a CAE oe

Steere dee aes te ae es

a

Shares = No. 18215 ai

___.__Bthelbert. B,_ Frey }

~-.... —Committee_for_Harry-C.—Porter—

Address % :

ee ee ee

member of The Prudential Building Auodation, Washington, D. C.,

subject to the lawful provisions of its constitution and by-laws.

Date March 3 __ss19._—S59.

ALWAYS BRING THIS BOOK WITH YOU

OR MAIL WITH PAYMENT.

° IMPORTANT . A

.

This book must accompany al! transactions.

Remittances may be made through the mail by check or money order.

All items credited in this book ore subject to final collection of check or | :

draft . ¢ f

Members should notify the Association of any change of address. ° This will at a

insure the delivery of Association reports and correspondence. — ». S

Keep this book smooth and clean. If lost, notify the Association pallaiaalis

Sofety of your Account in this Association is fully insured up to $10,000 by —

the FEDERAL SAVINGS AND LOAN INSURANCE CORPORATION, Washing-

ton, D. C., an instrumentality of the United Stotes Government.

ee,

EXHIBIT B-2

No. 18215

a ~

THE PRUDENTIAL BUILDING ASSOCIATION

WASHINGTON 5, D. C.

DATE

PAYMENTS

WITHORAWALS

BALANCE

MAR 399/ 3.00 0.U¥0 3,0 O O.U0} Pe

vv359 28.2 3,037.57

OCT 21 59 2,000.00-!} 1,067.95

wae 10.6 1,0 7 8.63} Pe

Jn 23 60 2:00 0.0 3,078.63 Pe

JUN 2 60 ‘79! 625.36- 3:4 83:3 fr

; OV3 24.8 : 90 Pe

Ové 2 5.0 2533.99 Pe

' NOV 26 60 -426250-4+ 2,371.49 Pr

}

)

!

'

'

‘

Muh.

od WqxT

1319 F Street, N, W. Puyer with Are remiltance.

Washington, D. C, SBE INSTRUCTIONS BELOW.

‘ ___ Unit Price

Dete DESCRIPTION Quantity re — Amount

For cost of care and treatment furnished

Harry C. Porter, #78,826, under the

provisions of Public Law 313, 84th

Congress, for the period October 1, 1960

thru December 31, 1960. 92 8.16 | day 750|72

Previously billed and unpaid | 2,194|18

|

E

S

ct

MAKE CHECKS PAYABLE TO: 5

SAINT ELIZABETHS HOSPITAL

RA teak be —_ “s

753099 AMOUNT DUE THIS BILL, | $.29%¥+| 90 __

= tent SS Ott

This is not a receipt

INSTRUCTIONS -

Tender of payment of the above hill may be made in cash, United States postal money order, express money ord@r, bank draft, or

check, to the office indicared Such tender, when in any other form than cash, should be drawn to the order of the Department or

Establishment and Burean or Office indicated above.

Receipts wil! be issued in all cases where ‘‘cash’’ is received, and only pon request when remittance isin any other form. If tender

of payment of this bill is other than cash or United States postal money order, the receipt shall not become an acquittance until such

tender has been cleared and the amount received by the Department or Establishment and Bureau or Office indicated above.

Failure to receive a receipt for a cash payment should be promptly reported by the payer to the chief administrative officer of the

bureau or agency mentioned above.

U S GOVERNMENT PRINTING OFFICE 1958 -O- 486459

ADORESS ONLY

THE SUPERINTENOENT

SAINT ELIZABETHS HOSPITAL Re: Harry C. Porter

Exhibit C-1

EXHIBIT C-1

DEPARTMENT OF

HEALTH, EDUCATION, AND WELFARE

SAINT ELIZABETHS HOSPITAL 78,826

WASHINGTON 20, D. C.

In reply refer to: FIN/JWH

January 12, 1961

Mr. Ethelbert B. Frey, Esq.

Attorney and Counsellor at Law

600 International Building ;

1319 F Street, N. W.

Washington, D. C.

Dear Mr. Frey:

Enclosed is Bill for Collection, in the

amount of $750.72, covering the cost of care and

treatment for your ward, Harry C. Porter, for the

period October 1, 1960 through December 31, 1960.

The total amount now due and unpaid 1s $2,944.90.

Sincerely yours,

Winfred Overholser, M. D.

Superintendent

Enclosure - 1

Ont y The i hep. Fok &. Fb

oo Fin . in paw Mes 7¢ 4.

EXHIBIT C-2

Form No. 11H

9 GAO 1030

11i¢ 103

BILL FOR COLLECTION 288

DEPARTMENT OF EFALTH, EDUCATION, AND WELPARE Bill No. .......-----.....-...-

ast! . == 12-31-60

(Deparumeat or Establahment and Buresu or Office’

Washington, D. C,

PAYER:

Ethelbert B. Frey, Coma,

600 International Building © This bill should be returned by the

1319 F Street, N. W. payer with his remittance.

Washington, D. C. SEE INSTRUCTIONS BELOW.

Dete | 7 Unit Price

DESCRIPTION Quantity es — = ay Amount

For cost of care and treatment furnished

Harry.C. Porter, #78,826, under the

provisions of Public Law 313, 84th |

Congress, for the period October 1, 1960 . agen

thru December 31, 1960. 92 8.16 day 750\72

Previously billed and unpaid 2,1% 18

|

| 3)

| E.

p S.

ct

MAKE CHECKS PAYABLE TO- 3

SAINT ELIZABETHS HOSPITAL

ee | L soft AeA Sa

753099 AMOUNT DUE THIS BILL, | 3.29%H+| 9 _

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