DocketNumber： No. 2465
Citation Numbers： 51 F.2d 992, 1931 U.S. App. LEXIS 3008
Judges： Anderson, Wilson
Filed Date： 1/8/1931
Status： Precedential
Modified Date： 11/4/2024
This is an action under the Lord Campbell Act of New Hampshire, sections 9-14, c. 302, Pub. Laws 1926, to recover for injuries resulting in the death of the plaintiff’s intestate and alleged to have occurred through the negligence of the defendant corporation.
The defendant in the action and appellant in this court is a publie utility corporation organized under the laws of Vermont, and having its principal place of business in the town of Bradford in Vermont. It is engaged in furnishing electric current for publie uses in both Vermont and New Hampshire. The plaintiff’s intestate was a resident of Bradford, but received his injuries in the course of his employment in the state of New Hampshire.
The contract of employment of the plaintiff’s intestate was entered into in Vermont. His work was that of a lineman, and at times he performed the duties of a “trouble shooter,” or an emergency man, who might be sent out at any time to repair sudden breaks in the lines.
In the evening of the day on which his injuries occurred, he was requested to go across the Connecticut river to restore bumed-out fuses at a substation in the town of Haver-hill, which lies on the east hank of the river in the state of New Hampshire, where in the course of his work he came in contact with high-tension wires and received the injuries which caused his death.
The action was originally brought in the New Hampshire superior court, and on petition of the defendant was removed to the federal District Court on the ground of diversity of citizenship; the plaintiff being a citizen and a resident of New Hampshire. On the third trial before a jury, it resulted in a verdict for the plaintiff for $4,000.
Vermont in 1915 (Pub. Laws 1915, No. 164) adopted what is known as a Workman’s Compensation Act of the elective type, common in most of the states, under which either the employer or employee could adopt its provisions or retain his rights at common law. To induce the employer to assent to be bound by its provisions, he was, in case of refusal, deprived of his common-law defenses of assumption of risk, negligence of a fellow servant, and contributory negligence; while the employee, in case he did not assent, must meet those defenses in addition to proving that his injuries were due to his employer’s negligence. In case both assented and the employee suffered injury arising out of, and in the course of, his employment, he received compensation based on his average weekly wage during his incapacity, whether his employer was negligent or not, and even though his injury was due entirely to his own negligence, or to that of a fellow servant, or was the result of pure accident.
Both employer and employee under the Vermont act, as in many of the compensation
Such provisions for the acceptance of the act have always been held sufficient to hind the parties, and in no ease has any such statute been held invalid as against public policy, or in violation of any constitutional provision on this ground. Opinion of the Justices, 209 Mass. 607, 610, 611, 96 N. E. 308; Mackin v. Detroit-Timkin Axle Co., 187 Mich. 8, 153 N. W. 49; American Radiator Co. v. Rogge, supra; Johnston v. Kennecott Copper Corp. (C. C. A.) 248 F. 407; Hopkins v. Matchless Metal Polish Co., 99 Conn. 457, 460, 121 A. 828; Crane v. Leonard, Crossette & Riley, 214 Mich. 218, 183 N. W. 204, 18 A. L. R. 285; Industrial Commission v. Ins. Co., 64 Colo. 480, 174 P. 589, 3 A. L. R. 1336; Rounsaville v. Railroad Co., 87 N. J. Law, 371, 94 A. 392; Pierce v. Storage Co., 185 Iowa, 1346, 172 N. W. 191; Foughty v. Ott, 80 W. Va. 88, 92 S. E. 143; State ex rel. Chambers v. District Court, 139 Minn. 205, 166 N. W. 185, 3 A. L. R. 1347; Anderson v. Miller Scrap Iron Co., 169 Wis. 106, 170 N. W. 275, 171 N. W. 935; Post v. Burger & Gohlke, 216 N. Y. 544, 111 N. E. 351, Ann. Cas. 1916B, 158; Hospers v. J. Hungerford Smith Co., 230 N. Y. 616, 130 N. E. 916.
It is also generally held that such a statute on acceptance by both parties becomes a part of the contract of employment and is exclusive of all other remedies in ease of injuries. Kennerson v. Thames Towboat Co., 89 Conn. 367, 371, 94 A. 372, L. R. A. 1916A, 436; Powers v. Hotel Bond Co., 89 Conn. 143, 147, 93 A. 245; Hopkins v. Matchless Metal Polish Co., 99 Conn. 457, 460, 121 A. 828; Gooding v. Ott, 77 W. Va. 487, 87 S. E. 862, L. R. A. 1918D, 637; Hunter v. Coal Co., 175 Iowa, 245, 154 N. W. 1037, 157 N. W. 145, L. R. A. 1917D, 15, Ann. Cas. 1917E, 803; Deeny v. Wright & Cobb Lighterage Co., 36 N. J. Law J. 121; Industrial Commission v. Ins. Co., supra; Dettloff v. Hammond, Standish & Co., 195 Mich. 117, 161 N. W. 949; Grinnell v. Wilkinson, 39 R. I. 447, 98 A. 103, L. R. A. 1917B, 767, Ann. Cas. 1918B, 618; Barnhart v. American Concrete Steel Co., 227 N. Y. 531, 125 N. E. 675; Martin v. Kennecott Copper Corp. (D. C.) 252 F. 207.
In terms, the Vermont act, section 5770, G. L. 1917, covers injuries to employees who are hired in that state, but whose employment requires them to perform work in another state where they are injured. It is now held with but few, if any, exceptions, at least under elective acts, and whether in terms covering injuries in another state or not, that, when assented to by both parties, a compensation act of the state of employment, at least in so far as it is administered in that state, will cover injuries received in the course of the employment in another state. In this sense such acts are said to have an extraterritorial effect. See eases above cited.
Massachusetts, in construing its original act in an early decision, Gould’s Case, 215 Mass. 480, 102 N. E. 693, Ann. Cas. 1914D, 372, held the contrary, and this decision was followed in a few states; hut Massachusetts since its decision in the Gould Case has amended its act, and in a recent decision, Penderzoli’s Case, 169 N. E. 427, decided January 3, 1930, now holds its act under a contract of employment entered into in Massachusetts covers injuries received by the employee in another state. The great weight of authority now sustains this construction as the most practical. Otherwise great confusion would result as to the rights and obligations of employer and employee, where employees are sent out of the state to do work.
In this case, as neither the defendant corporation nor the plaintiff’s intestate gave notice of a refusal to assent to the Vermont act, both were bound by it, and its provisions became a part of the contract of employment and covered all injuries, whether received in Vermont or New Hampshire, and for which under the Vermont act no action at common law based on negligence would lie. See eases above cited.
There can be no doubt, therefore, if the proceedings had been brought under the Vermont statute, the plaintiff’s intestate could have recovered only the sum provided where there are no dependents; and herein lies the reason for this action. The deceased had no dependents, and, as is provided in all such acts, including that of New Hampshire, in such eases only a comparatively small sum to provide for burial expenses is allowed.
As the court said in Wasilewski v. Warner Sugar Refining Co., 87 Misc. Rep. 156, 149 N. Y. S. 1035, 1036: “The plaintiff, however, does not now wish to accept the payment to which he is entitled under the compensation plan. He is advised that his injuries were due to the employer’s negligence, and he wishes to take his chances on getting a larger amount through a suit at law.”
At the opening of the trial in the federal court, the defendant filed its answer and a brief statement of defense in which it set up the provisions of the Vermont Compensation Act, and the fact that the defendant and the deceased were both residents of Vermont, that the deceased was hired in Vermont, and that both the defendant and deceased had accepted the Vermont act, all of which it claimed was a bar to the action, and moved for a dismissal of the action.
The plaintiff then moved that the brief statement be rejected on the following grounds:
(1) That the Workmen’s Compensation Law of Vermont has no extraterritorial force or effect and does not control the rights of the parties in this litigation.
(2) That the rights of the parties to this action are determinable solely by the laws of the state of New Hampshire.
(3) That the plaintiff’s cause of action accrued under and by virtue of the laws of New Hampshire, the injury causing the death of the plaintiff’s intestate occurring while he was employed within said state.
(4) That the matters set forth in the defendant’s brief statement do not constitute a valid and legal defense to the plaintiff’s cause of action.
This motion was in effect a demurrer to the brief statement and an admission of the facts stated therein.
The District Court we think misconceived the nature of the defense set up in the brief statement, probably due to the fact that the plea of the defendant ended with a motion to dismiss the action, and held that it was a plea to the jurisdiction and denied the motion to dismiss on the ground that the Vermont statute had no extraterritorial effect and that the action was under the Employers’ Liability Act, and was based on tort and not on contract.
Prom one viewpoint the court’s ruling may have been technically correct, but both parties apparently accepted it as a ruling that the facts set forth in the brief statement did not constitute a good defense to the action. The case was evidently tried upon the understanding that the court had ruled that the Vermont contract was without effect as a defense. Counsel so argued th'e ease before this court on appeal; the defendant having made the court’s ruling on these motions its first assignment of error.
The industrial policy embodied in these statutes was borrowed from England and Germany. The first act in this country was adopted in 1910 in the state of New York, which was declared unconstitutional by the state court. Ives v. South Buffalo R. Co., 201 N. Y. 271, 94 N. E. 431, 34 L. R. A. (N. S.) 162, Ann. Cas. 1912B, 156.
New Hampshire in 1911 (Laws 1911, c. 163) adopted a modified form of a compensation law applicable only to certain hazardous employments, one of which was work on electric lines. Like the acts of most of the other states adopted about that time and since, it is elective, but differs in this respect, that the employee or his representative, in ease of his death from injuries received in the course of his employment, is not obliged to elect until after the injury occurs.
The defendant company accepted the New Hampshire act, but neither the deceased nor his representative ever did. While the defendant’s reasons for so doing were not disclosed by direct testimony, it appears in the record that its operations extended some distance into New Hampshire, and it perforce must at times, at least, have employed men in .that state as well as in Vermont. If it wished to retain its common-law defenses as to these men, it must accept the act.
The first and real question to be decided in this ease, the relations between the employer and employee being contractual, is whether the law of the lex loci contractus should govern under the well-recognized principles of comity, or the law of the state where the tort occurred.
Under the doctrines of conflict of laws, there are certain general rules which are well settled: (1) A tort action is governed by the law of the state where the injury occurred; (2) no state law has any extraterritorial effect in the sense that it becomes part of the statutory law of another state or controls the courts of any other state in administering justice; (3) on the principles of comity, however, a contract entered into in one state, if valid in that state, will be enforced in the courts of another state unless contrary to its laws or public policy.
Connecticut at one time applied its own Compensation Law to a contract of employment entered into in New York to be performed in Connecticut, Banks v. Howlett Co., 92 Conn. 368, 102 A. 822; but it later limited the decision to the facts in that ease, Hopkins v. Matchless Metal Polish Co., 99 Conn. 457, 460, 121 A. 828; and finally overruled it in Pettiti v. Pardy Construction Co., 103 Conn. 101, 109, 130 A. 70.
New York has in one or more eases held that the recovery of compensation in the state of the injury will not prevent recovery in the state of employment, when both employer and employee have assented to the Compensation Act of each state. Jenkins v. Hogan & Sons, 177 App. Div. 36, 163 N. Y. S. 707; Gilbert v. Des Lauriers Column Mould Co., 180 App. Div. 59, 167 N. Y. S. 274.
These eases, however, granting compensation in New York when compensation was also allowed in New Jersey, have since been distinguished in Anderson v. Jarrett Chambers Co., 210 App. Div. 543, 206 N. Y. S. 458, where it' was held that, if the contract of employment was a New York contract, and the employment hazardous, the employee could not waive his rights under the New York compulsory statute by the acceptance of compensation under the New Jersey act; but, where the contract was a New Jersey contract and the accident occurred in New York, the New York courts follow Connecticut, in that they will not take jurisdiction, but leave the party to his remedy in New Jersey. Minto v. Hitchings & Co., 204 App. Div. 661, 198 N. Y. S. 610, 612; Schweitzer v. Hamburg-Amerikanische, 78 Misc. Rep. 448, 138 N. Y. S. 944; also, see Mosely v. Empire Gas & Fuel Co., 313 Mo. 225, 281 S. W. 762, 45 A. L. R. 1223; Pettiti v. Pardy Construction Co., 103 Conn. 101, 130 A. 70; Hopkins v. Matchless Metal Polish Co., 99 Conn. 457, 121 A. 828; Wasilewski v. Warner Sugar Refining Co., 87 Misc. Rep. 156, 149 N. Y. S. 1035; Barnhart v. Am. Concrete Steel Co., 227 N. Y. 531, 125 N. E. 675; Norman v. Hartman Furniture Co., 84 Ind. App. 173, 150 N. E. 416.
The New Jersey court, in Rounsaville v. Central R. Co., 87 N. J. Law, 371, 374, 94 A. 392, but in a dictum, also intimated that, even though compensation had been granted in another state because the accident occurred there, it would not prevent the New Jersey eourt from granting compensation, provided the contract was a New Jersey contract. The actual decision in this ease, however, is not of necessity out of harmony with those holding that it is the lex loci contractus which governs. Hopkins v. Matchless Metal Polish Co., supra; Norman v. Hartman Furniture Co., supra; Minto v. Hitchings & Co., supra; Schweitzer v. Hamburg-Amerikanische, supra. In the ease of Johns-Manville v. Thrane, 80 Ind. App. 432, 141 N. E. 229, cited by plaintiff to sustain the contention that it is the law of place of injury which governs, it will be found that the contract of hiring in that case was held to be an Indiana contract, while in Norman v. Hartman Furniture Co., supra, the Indiana eourt refused compensation, though the accident occurred in Indiana, on the ground that the contract was an Illinois contract and the law of that state controlled. Since the decision in the New Jersey case, we think there has been a change in the attitude of the courts toward these laws and their extraterritorial effect.
The New York court, in Minto v. Hitch-ings & Co., remarked with appropriateness, we think, that it would be “unseemly for a person to seek redress under the law of his own state, succeed, and afterwards institute the same proceedings in a different forum under the law of another state.” It would also appear that the converse should be equally unseemly, unless under the circumstances found in Anderson v. Jarrett Chambers Co., supra.
Bradbury in his third edition of his work on Compensation Law, page 88, after reviewing the result of the administration of the law for nearly two decades,- says: “It would seem that the application of the doctrine that the parties should be governed by the workmen’s compensation law of the state where the contract of employment was made, would settle very many of the difficulties which are bound to arise and any other doctrine would multiply these difficulties.”
Counsel for plaintiff contends that it is against the public policy of New Hampshire for an employee to enter into a contract relieving his employer of liability for injuries due to the employer’s negligence; but the rule against contracts relieving an employer
When New Hampshire adopted its Compensation Act the constitutionality of such legislation was then being questioned in other states. Ives v. South Buffalo R. Co., supra. The New Hampshire Legislature, out of abundance of caution, not only limited its acts to hazardous employments, but, in order to avoid the possibility that it might be held to constitute an agreement to waive liability on account of an employer’s negligence, permitted acceptance of the compensation provided in the statute after the injury, upon the theory, it may have been, that it would then be held to be in the nature of a settlement of employee’s claim; but this fear, if such it was, has proved groundless, as the cases above cited hold. No other state has adopted such a similar provision for acceptance. That the New Hampshire Legislature adopted this peculiar provision in its act upon the ground that an acceptance of the act before injury would be injurious to the welfare of the people of New Hampshire is highly improbable.
As a rule, the federal courts will follow the decisions of the state courts in interpreting their statutes or in determining the public policy of the state; but the New Hampshire courts have not yet held any Compensation Act of a sister state contrary to its public policy, or passed on the question here involved. We must, therefore, decide the issues in the light of the decisions of other jurisdictions. In view of the declarations in Mulhall v. Nashua Mfg. Co., supra, however, we cannot conceive of the New Hampshire court of last resort holding as a general proposition that a statute, which has been adopted in so many states, and acclaimed far and wide as one of the most beneficent acts of recent years in promoting the general welfare of the working man, is contrary to the general welfare of the citizens of New Hampshire on the first grounds urged by counsel.
But it is also urged that the law of Vermont, inasmuch as it presumes the acceptance of its act from silence, is contrary to the public policy of New Hampshire, since the New Hamphire act permits acceptance after the injury and also requires a positive act.
If the Vermont act as a whole is not contrary to the public policy of New Hampshire, can it then be said that, merely because the provision: of the Vermont act as to the acceptance of the act differs from that of the New Hampshire act, it is contrary to the public policy of New Hampshire?
No brief all-inclusive definition of what is meant by public policy has yet been evolved. In general it is said that, to be contrary to the public policy of a state, a contract must be inconsistent with good morals, natural justice, or the public welfare or some positive law forbidding it. As to the nature of contracts held to be against public policy and its scope, see 6 R. C. L. 707 et seq. § 114-214; Williston’ on Contracts, vol. 3, c. XLIV-XLVIII.
The Washington state court said, in State ex rel. Baker, etc., R. Co. v. Nichols, 51 Wash. 619, 99 P. 876, 877: “Comity depends, not alone upon a disposition to favor the citizen of another state or country, but rests upon well-settled principles of practice, expediency, and convenience. It is a rule recognized by courts, and applied within bounds of discretion. It is based upon the statute law or decisions * * * of other states or countries rather than upon our own. These will be recognized and given force if it be found that they do not conflict with the local law, inflict an injustice on our own citizens, or violate the public policy of the state.”
The United States Supreme Court in Oscanyan v. Arms Co., 103 U. S. 261, 277, 26 L. Ed. 539, said, as a matter of comity: “The general rule undoubtedly is that the validity of a contract is to be decided by the law of the place where it is made, unless it is to be performed in another country; but to this, as to all general rules, there are exceptions, and among these Story mentions contracts made in a foreign country to promote or reward the commission of crime, to corrupt or evade the due administration of justice) to cheat public agents, or to affect the public rights, and other contracts which in their nature are founded in moral turpitude, and are inconsistent with the good order and solid interest of society. ‘All such contracts,’ he adds, ‘even although they might be held valid in a country where they are made, would be held void elsewhere, or at least ought to be, if the dictates of Christian morality, or even of natural justice, are allowed to have their due force and influence in the administration of international jurisprudence.’ Story, Conflict of Laws, see. 258.”
The Supreme Court of the state of Washington, however, in Reynolds v. Day, 79 Wash. 499, 140 P. 681, L. R. A. 1916A, 432, although it had, by a compulsory compensation act as to hazardous employments, and by voluntary assent as to nonhazardous, done away with the old common-law remedy for injury through negligence, which its Legislature declared to be “inconsistent with modem industrial conditions,” enforced a eommon-law remedy of a sister state on the ground of comity, and held it was not contrary to the publie policy of Washington, as it still retained the common-law remedy in certain eases.
If it should be held, however, that every provision of these compensation acts established a definite publie policy for the state adopting it, then it would follow that a state which required a positive act of acceptance by the employer would be against the public policy of a state which presumed his acceptance, unless he gave notice, and vice versa; or a state having an act applying to hazardous employments, such as New York, would hold an act covering also nonhazardous occupations, as New Jersey or Connecticut, was contrary to its publie policy; or an act granting fixed weekly sums for certain injuries is contrary to the law of state basing compensation for all injuries on a percentage of the average weekly wage. But details of this nature have never been -regarded as establishing a definite publie policy as to each detail. Otherwise we should have the confusion which the courts have been seeking to avoid by holding that the law of the lex loci contractus should govern where the injury occurred in another state, since few of these acts are an exact counterpart of any other.
The numerous decisions of the courts giving these acts extraterritorial effect would then be of little value, as an injured employee, whenever his contract of employment was in one state where he had accepted a compensation act, and he was injured in another, might in every sueh case, if to his advantage, bring a common-law action in the state where injured, provided the act of the. state of employment differed in any important provision from the act of the state where the injury occurred; but no court has yet so held. See decisions cited above.
The state courts have repeatedly held that, because a statute of one state differs in some of its provisions from that of the state of the forum, it does not follow'that the courts of the state of the forum would not enforce contracts entered into in the other state and valid under its law, though not in compliance with the lex fori, especially where both statutes were enacted with the same purpose in view.
The Minnesota court, in Herrick v. Minneapolis & St. Louis Ry. Co., 31 Minn. 11, 16 N. W. 413, 47 Am. Rep. 771, which is quoted with approval by the United States Supreme Court in Northern Pac. R. Co. v. Babcock, 154 U. S. 190, 14 S. Ct. 978, 981, 38 L. Ed. 958, says: “It by no means follows that, because the statute of one state differs from the law of another state, therefore it would be held contrary to the policy of the laws of the latter state. Every day our courts are enforcing rights under foreign contracts where the lex loci contractus and the lex fori are altogether different, and yet we eonstrue these contracts and enforce rights under them according to .their force and effect under the laws of the state where made. To justify a court in refusing to enforce a right of action which accrued under the law of another state because against the policy of our laws, it must appear that it is against good morals or natural justice, or that, for some other such reason, the enforcement of it would be prejudicial to the general interests of our own citizens.”
To the same effect is Chicago & E. I. R. Co. v. Rouse, 178 Ill. 132, 52 N. E. 951, 44 L. R. A. 410; Stewart v. Balt. & Ohio R. Co., 168 U. S. 445, 18 S. Ct. 105, 42 L. Ed. 537; Higgins v. Central N. E. & W. R. Co., 155 Mass. 176, 29 N. E. 534, 31 Am. St. Rep. 544; Morris v. Chicago, R. I. & P. R. Co., 65 Iowa, 727, 23 N. W. 143, 54 Am. Rep. 39.
The New York court, in Leonard v. Columbia Steam Nav. Co., 84 N. Y. 48, 38 Am. Rep. 491, in enforcing a contract entered into in another state, held: “The rule here laid down is just and reasonable, and it is not essential that the statutes should be precisely the same as that of the state where the action is given by law or where it is brought, but merely requires that it should be similar in import and character.”
Nor is it clear that the part of the New Hampshire act as to acceptance was intended to be mandatory, and, if held to be for the benefit of the employee, could not be waived by the employee and employer, and that an agreement to accept prior to the injury would not be enforced. Mulhall v. Nashua Mfg. Co., supra; Kelsea v. Ins. Co., 78 N. H. 422, 425, 101 A. 362.
It has been suggested that it has been held in two jurisdictions that, when compensation allowed in one state was not sufficient, additional compensation might be recovered in another state, citing Farr v. Babcock Lumber Co., 182 N. C. 725, 109 S. E. 833, and Rorvik v. North Pac. Lumber Co., 99 Or. 58, 190 P. 331, 195 P. 163. But on careful examination of the facts it will be found that the first, if it has any application, is contra; and the second was for the recovery of damages for injuries caused by a third party other than the employer; and provision is usually made in compensation acts .whereby, if the injury was due to the negligence of a third party, the employer, having paid compensation under the act, is subrogated to the rights of the employee against the third party, and, if an employer fails to sue, the employee may.
We are of the opinion that there is nothing in the contract entered into between these parties in Vermont that is contrary to the main purpose of the New Hampshire act, or inimical to the welfare of its citizens, and, according to the trend of recent decisions in other jurisdictions, the contract of hire under the Vermont act, upon the principles of comity, constitutes a good defense to an action under the New Hampshire death statute, there having been no contract of hire in New Hampshire.
The judgment of the District Court is vacated, the verdict is set aside, and the case i's remanded to that court for further proceedings not inconsistent with this opinion; the appellant recovers costs of appeal.