Opinion
Decided July 5, 1927.
Assignment of wages — Partial assignment, without employer's acceptance, invalid under common law — Assignment of 50 per cent., without employer's consent, valid under statute — Section 6346-12, General Code — Assignment not mere lien, cognizable in equity, but enforceable in law.
1. Under common-law rule, assignment of whole of employee's wages is valid without employer's acceptance, but assignment of only part thereof is valid only on acceptance by employer.
2. In view of Section 6346-12, General Code, limiting assignment of employee's wages to 50 per cent. thereof, assignment of such percentage is valid without employer's consent.
3. Assignment of 50 per cent. of employee's wages, due or to become due, for 36 weeks or until his indebtedness to assignee was paid in full, held not a mere lien, cognizable in equity only, but an assignment on which assignee may recover from employer in action at law.
ERROR: Court of Appeals for Hamilton county.
Mr. Joseph R. Rohrer, for plaintiff in error.
Mr. H.H. Sundermann, for defendants in error.
One Edward Murphy was an employee of the American Laundry Machinery Company, plaintiff in error here. While so employed, he made an assignment of 50 per cent. of his wages due from the American Laundry Machinery Company, and wages which may hereafter for the period of 36 weeks become due, to the Spencer Jewelry Company. The assignment of 50 per cent. of the wages due or to become due was for the period of 36 weeks, or, in the alternative, until the indebtedness to the Spencer Jewelry Company in the sum of $137.87 was paid in full. This assignment was executed July 19, 1924. Murphy made three small payments to the Spencer Jewelry Company, and then ceased to pay. Thereupon, on December 1, 1924, the Spencer Jewelry Company filed with the American Laundry Machinery Company the assignment of wages executed by Murphy to it, together with an attached statement of the amount due, which assignment the Machinery Company refused to honor, whereupon the Jewelry Company brought suit in the municipal court against the American Laundry Machinery Company to recover the wages assigned by Murphy to it.
The trial in the municipal court resulted in a judgment in favor of the Jewelry Company and against the American Laundry Machinery Company. The American Laundry Machinery Company prosecuted error to the court of common pleas, which court affirmed the judgment of the municipal court. Error is prosecuted here, seeking a reversal of those judgments.
The defense was that the assignment was merely as a security, to secure the payment of monthly installments of indebtedness to the Jewelry Company, and a further defense was that the moneys earned, covered by the purported assignment, had all been paid to the assignor.
Stripped of all technicalities and verbiage the question here amounts to this: Can an action at law be maintained against an employer for an assignment of 50 per cent. of the wages of an employee, which assignment is not accepted by the employer.
Much has been said in the brief of the plaintiff in error, and in the brief of amicus curiæ, of the cases decided under the common law, bearing on the question of wage assignments. It is conceded to be, and is, the law, that, under the common-law rule, an assignment of the whole of an employee's wages is valid without the acceptance of the employer. It is further the law that under the common-law rule an assignment of a part of an employee's wages is valid only on acceptance by the employer.
The assignment in question was of 50 per cent. of the wages, and it is argued, this being an assignment of but a part of the wages, that, under this rule of law, acceptance on the part of the employer was necessary to make it binding on the employer.
The question was settled, and would probably not be here except for the passage of Section 6346-12, General Code of Ohio. The Legislature saw fit, under the police power, to limit the assignment of wages to 50 per cent. of the wages earned and to be earned. The reasons are apparent, and the limitation was for the protection of the employee's family. The reasons for the holding of the courts, that only in case the whole of the wages was assigned could an action be maintained without acceptance by the employer, was to avoid splitting up causes of action and the annoyance of a multiplicity of suits. The statute provides that an assignment of more than 50 per cent. of the personal earnings of the assignor shall be void. So we have no difficulty with the rule in any sum in excess of 50 per cent. of the earnings. The assignment in question here was of the full 50 per cent. and within the law, no more, no less.
The protection of the employer against multiplicity of suits, which, as above stated, was the only reason for the holding of the courts under the common law, is taken care of. The reason for the rule is just as cogent as the rule itself.
On the question suggested in the brief that the assignment was a mere lien, cognizable in equity only, it is sufficient to say that the instrument has none of the earmarks of any such lien. It is an assignment, or it is nothing.
Our conclusion is that the assignment is a valid assignment, and that the judgment of the municipal court, and of the court of common pleas, affirming that judgment, was correct.
Judgment affirmed.
CUSHING, J., concurs.