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G-Fours Inc. v. Miele

decided: April 24, 1974.

G-FOURS, INC., PLAINTIFF-APPELLEE,
v.
CHARLES A. MIELE AND INTERSURANCE SYSTEMS CORPORATION, DEFENDANTS-APPELLANTS



Appeal from order of the United States District Court for the Southern District of New York, Walter R. Mansfield, J., sitting by designation, which held Ethel Miele in civil contempt for refusing to answer interrogatories concerning her husband's assets. Affirmed.

Kaufman, Chief Judge, Feinberg and Mulligan, Circuit Judges.

Author: Feinberg

FEINBERG, Circuit Judge:

Defendant Charles A. Miele and his wife Ethel appeal from an order of the United States District Court for the Southern District of New York, Walter R. Mansfield, J.,*fn1 which held Ethel Miele in contempt for refusing to answer certain written interrogatories regarding her husband's assets. Mrs. Miele had asserted a marital privilege not to reply to various questions, but the judge rejected this claim. Because we believe that the marital privilege was not available, we affirm the contempt order although on a partially different theory from that relied on by the district court.

I

The underlying diversity action was tried before Judge Mansfield without a jury in April 1972. The complaint alleged, and the judge found, that Charles Miele had defrauded plaintiff G-Fours, Inc. in 1968 in connection with the financing of a Colorado construction loan. Accordingly in June 1972, plaintiff was awarded a judgment of $15,217.54, representing damages of $11,400 plus interest, costs and disbursements.

Since then, plaintiff has fruitlessly been trying to collect this amount from Charles Miele. After the marshal's execution obtained only $783.40 from a bank account, G-Fours began supplementary proceedings to discover hidden or fraudulently transferred assets. Plaintiff served information subpoenas and interrogatories*fn2 upon judgment debtor Charles Miele, his wife Ethel, and his wholly-owned corporation, Infinco, Inc., and all three failed either to respond or to move to obtain a protective order. On plaintiff's unopposed motion, the court then directed Charles Miele, his wife and Infinco to answer the questions put to them and to pay $250 counsel fees. Plaintiff duly served the court's order upon all, and for the first time Charles Miele claimed his privilege against self-incrimination with respect to several questions because criminal proceedings were pending against him.*fn3 Infinco made similar responses. Mrs. Miele also refused to answer some questions, which sought information regarding her husband's bank accounts and property and recent transfers to her by her husband of property or money, "on the grounds of the privilege between husband and wife."*fn4

G-Fours moved to hold all three in contempt. The judge, in an unpublished memorandum, sustained Mr. Miele's assertion of his self-incrimination privilege, but rejected the corporation's similar claim and held it in contempt. The judge also ruled that Mrs. Miele was in contempt because the "spousal immunity" granted by New York State law did not protect her. Infinco and Mrs. Miele were jointly directed to pay plaintiff its costs in obtaining the contempt order and attorneys' fees in the sum of $1,500. Thereafter, both Mieles asked the judge to reconsider his ruling. In the consequent flurry of papers, plaintiff brought to the attention of the court what may have been a fraudulent conveyance by Charles Miele to his wife of an expensive automobile and hearsay allegations that Mr. Miele in a bail application, see note 3 supra, had claimed to own two automobiles, a house and various bank accounts. Mr. Miele denied these charges. However, the judge adhered to his decision holding Mrs. Miele in contempt. That ruling is the subject of this appeal.*fn5

II

Mrs. Miele bases her claim of marital privilege upon N.Y.C.P.L.R. ยง 4502(b), which provides:

A husband or wife shall not be required, or, without consent of the other if living, allowed, to disclose a confidential communication made by one to the other during marriage.*fn6

In holding the marital privilege unavailable to Mrs. Miele, Judge Mansfield ruled that the information sought was not confidential because it related solely to "ordinary business conversations with her husband," citing Parkhurst v. Berdell, 110 N.Y. 386, 393-94, 18 N.E. 123 (1888). We believe that the district court's holding was correct.

In Parkhurst, the plaintiff sued Berdell for misappropriation of securities which plaintiff had loaned him. At trial, Berdell's wife was required to testify

as to conversations with him when they were alone as to plaintiff's securities taken by him, his obligations to [plaintiff] for the same, and his ...


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