Clark v. Olson

In my opinion, our Workmen's Compensation Act was designed simply to fix the rights and remedies of an injured employee as against his employer, and not as against negligent third persons. I think the cases of Bruce v. McAdoo, 65 Mont. 275, 211 P. 772, andBlack v. Northern P. Ry. Co., 66 Mont. 538, 214 P. 82, are erroneous and should be expressly overruled. They are based upon cases from the state of Washington. The Washington statute is essentially different from ours. It expressly deals with the rights of action against third persons. The Washington Act (Laws 1911, p. 356, sec. 5) contains this clause: "And, except as in this Act otherwise provided, such payment shall be in lieu of any and all rights of action whatsoever against any person whomsoever." The circuit court of appeals declined even to interpret the Washington statute as precluding an action against a third person. (Meese v. Northern Pacific Ry. Co., 211 Fed. 254.) The United States Supreme Court overruled the circuit court of appeals only because it was bound to follow the interpretation of the statute as made by the supreme court of Washington. (Northern P. Ry. Co. v. Meese, 239 U.S. 614,36 Sup. Ct. 223, 60 L. Ed. 467.) In any event, our statute contains no such language as does the Washington statute. Nowhere either in the body of our Act or in the title, is there any intimation that it had or has anything to do with the liability of a negligent third person to an injured employee, when such third person is not a fellow-servant of the injured employee.

Sections 2838 and 2839, Revised Codes 1921, are relied upon as abolishing all causes of action against negligent third persons. Section 2838 provides: "Any employer who elects to pay compensation as provided in this Act shall not be subject to the provisions of section 2836, nor shall such employer be subject to any other liability whatsoever for the death of or personal injury to any employee except as in this Act provided; and, except as specifically provided in this Act, all causes of action, actions at law, suits in equity, and proceedings whatever, and all statutory and common-law rights and remedies for and on account of such death of, or personal injury to, any such employee are hereby abolished; provided, that section 2836 shall not apply to actions brought by an employee who has elected not to come under this Act, or by his representatives, for damages for personal injuries or death, against an employer who has elected to come under this Act."

Section 2839 is as follows: "Where both the employer and employee have elected to come under this Act, the provisions of this Act shall be exclusive, and such election shall be held to be a surrender by such employer and such employee of their right to any other method, form, or kind of compensation, or determination thereof, or to any other compensation, or kind of determination thereof, or cause of action, action at law, suit in equity, or statutory or common-law right or remedy, or proceeding whatever, for or on account of any personal injury to or death of such employee, except as such rights may be hereinafter specifically granted; and such election shall bind the employee himself, and in case of death shall bind his personal representative and all persons having any right or claim to compensation for his injury or death, as well as the employer, and those conducting his business during liquidation, bankruptcy, or insolvency."

In the Bruce Case this court said: "The only exception contained in the statute thereafter `specifically granted' is in instances where the workman is injured `away from the plant of his employer due to the negligence or wrong of another not in the same employ,' in which instance the injured employee or his beneficiaries or dependents are given the right of election to take compensation under the Act or to seek a remedy against the third person to whose negligence is ascribed the injury or death of the employee, which election must be made in advance of the commencement of any action." (Sec. 6 (2), subd. 1; now sec. 2863, Rev. Codes 1921.)

It is my opinion that the court was in error in holding that the exception referred to in sections 2838 and 2839 had reference to section 2863. It is my view that the exception had to do with sections 3003 and 3004. Section 3003 provides: "For any injury happening to any of his workmen during default in any payment to the industrial accident fund, the defaulting employer as to such injury shall be considered as having elected not to come under the provisions of this Act, except that he shall be and remain liable to pay to the industrial accident fund the amount of such default, together with the penalty prescribed by section 2996." Section 3004 provides: "The person entitled to sue under the provisions of the preceding section shall have the option of proceeding by suit or taking under this Act. If such person take under this Act, the cause of action against the employer shall be assigned to the state for the benefit of the industrial accident fund. If such person shall elect to proceed against the defaulting employer, such election shall constitute a waiver of any right to compensation under the provisions of this Act."

I think neither the exceptions under sections 2838 and 2839 nor any other of the provisions of those sections have to do with a cause of action against negligent third persons.

In my opinion, section 2863 does not purport to grant a right of action against a negligent third person, otherwise taken away by sections 2838 and 2839. It simply recognizes the existence of a right of action against negligent third persons in all cases, and, in case the injury occurs away from the plant of the employer, requires the employee to make an election of remedies. It is absurd to suppose that the legislature intended to grant to an employee injured away from the plant of an employer greater rights and privileges than to one injured on his plant. Is there any conceivable reason why a person injured on the plant of his employer by a negligent third person should not have the same right to sue the third person as an employee who is injured off the plant? It seems to me that such unwarranted discrimination between an employee injured on the plant of the employer, and one injured off the plant, should not be imputed to the legislature. Such a construction of the statute would result in this situation: A and B are both in the employ of C. All have elected to be governed by the Workmen's Compensation Act. A was working on the plant of C. B, three feet removed from A, was off the plant. Both A and B are injured — totally disabled — in the same manner and at the same time by the negligence of D, who is a stranger to the Workmen's Compensation Act. Under the construction of these statutes as made in the Bruce and BlackCases, A's exclusive remedy is to receive the compensation provided for against his employer. This compensation falls short of making him whole financially. He must lose one-half of his wages. He receives nothing for pain and suffering or for physical impairment. If the disability is permanent, he is nevertheless paid one-half his wages only for 300 weeks, as the law was originally enacted. (Sec. 16, Chap. 96, Laws 1915.)

B, who happened to be off the plant of his employer when injured, may, if he so elects, sue D and recover full compensation for the damage sustained by him. This interpretation denies to A the equal protection of the law. I realize that it is competent for the legislature to make classifications when there is some reasonable basis therefor, precluding the idea that the classification is arbitrary. But I can see no reasonable basis for such hostile discrimination.

This question seems to have been suggested to the Supreme Court of the United States in the case of Northern P. Ry. Co. v. Meese, 239 U.S. 614, 36 Sup. Ct. 223, 224, 60 L. Ed. 467, cited above. The court in that case, speaking through Mr. Justice McReynolds, disposed of the question in four lines in the opinion, reading: "Respondents' suggestion that the construction of the Act adopted by the trial court would cause it to conflict with the equal protection clause of the 14th Amendment is without merit." I am not convinced that the supreme court gave the question the consideration its importance demands. I am unable to conceive of any reason upon which such a classification can be sustained. In any event, a construction resulting in such hostile discrimination should not be adopted unless plainly compelled. I think the legislature never intended to make such an arbitrary classification. Rather, all that the legislature intended was that, as to an employee injured on the plant of the employer by a negligent third person, he need not make an election — he may recover compensation from his employer and may also sue the negligent third person — while, as to the employee injured off the premises, an election must be made. In other words, there is some reason for giving the employee injured on the plant of his employer an advantage over the employee injured off the plant. So far as the employer is concerned, he has control over his own premises and is "at least theoretically responsible for accidents occurring thereon" (Bruce v. McAdoo, supra), and therefore as to such an employee the legislature did not deem it necessary that the employer have the benefit of the cause of action against the third person assigned to him, as in the case of an employee injured off the premises of the employer, as provided in section 2863.

It is my view, therefore, that, when the legislature amended section 2863 by Chapter 121 of the Laws of 1925, it left all employees in the same situation and permitted them to seek compensation against the employer as well as to seek recovery against a negligent third person.

Other courts, under statutes substantially the same as our sections 2838 and 2839, have held that they abolish only causes of action against the employer, and do not affect rights of action against negligent third persons. In the case of HotelEquipment Co. v. Liddell, 32 Ga. App. 590, 124 S.E. 92, 94, the statute under consideration was section 12 of their Act (Laws 1920, p. 167), reading as follows: "That the rights and remedies herein granted to an employee where he and his employer have accepted the provisions of this Act respectively to pay and accept compensation on account of personal injury or death by accident shall exclude all other rights and remedies of such employee, his personal representative, parents, dependents or next of kin, at common law or otherwise on account of such injury, loss of service or death." The court, in speaking of it, said: "Section 12 does not by express language take away the right of an employee to sue the wrongdoer. Its terms can only mean that he and his employer are subject to the Act and that he shall have no other remedy against his employer. Third persons are not concerned. An outsider does not share the burdens of the Act imposed upon the employer, and he is entitled to none of its benefits. It was never the purpose of this statute to place exclusive liability upon the master for injuries to his employees, arising out of and in the course of the employment, and thus to grant immunity and license to others who were responsible for the injuries." This holding was adhered to by the supreme court of Georgia in AthensRy. Elec. Co. v. Kinney, 160 Ga. 1, 127 S.E. 290. In the note in 19 A.L.R. 766, it is said: "The Compensation Act, according to the weight of authority, does not take away the remedy of the employee, at common law or under another statute, against the third person."

In O'Brien v. Chicago City R. Co., 305 Ill. 244,137 N.E. 214, 216, 27 A.L.R. 479, there was involved a statute much like our sections 2838 and 2839. Section 6 of the Illinois statute (Hurd's Rev. Stats. Ill. 1921, Chap. 48, sec. 131) provided: "No common law or statutory right to recover damages for injury or death sustained by any employee while engaged in the line of his duty as such employee other than the compensation herein provided shall be available to any employee who is covered by the provisions of this Act, to anyone wholly or partially dependent upon him, the legal representatives of his estate, or any one otherwise entitled to recover damages for such injury." Section 11 of the Act (Hurd's Rev. Stats. Ill. 1921, Chap. 48, sec. 136) declared that the compensation provided for shall be the measure of the responsibility which the employer has assumed for injuries or death to employees. In that case there was also involved a statute, section 29 (Hurd's Rev. Stats. Ill. 1921, Chap. 48, sec. 152b), somewhat similar to our section 2863, and the court said: "Section 6 abolished the common-law right to recover damages for an injury sustained by an employee in the line of his duty as such employee and the statutory right to recover damages for the death of an employee caused by negligence while engaged in the line of his duty as such employee. The language of the section is broad enough, if considered as an independent sentence separate from any context, to deprive a workman injured in the manner mentioned, or his legal representatives or dependents, or any person otherwise entitled, of any right to recover damages against any person, whether his own employer, a fellow employee of his own employer whose negligence caused the injury, another employer in the same or a different kind of industry, an employee of another employer, or a total stranger to employment in any capacity who negligently or maliciously caused the injury. In any interpretation of the language, however, the subject-matter in connection with which it is used must be taken into consideration, and that subject-matter here is compensation for injuries suffered in the course of employment — not injuries generally or negligence generally. Those two subjects do not come within the scope of the Act, except as they are incidentally affected by the relation of employment — the respective rights and liabilities of the employer and employee because of that relation. If sections 11 and 29 had been omitted from the Act, there would be no justification for concluding that section 6 abolished the right of action for negligence causing injury or death. The provisions of the latter section apply only to the right of the employee against his employer, and have no reference to the liability of third persons causing injury to the employee. (Goldsmith v. Payne, 300 Ill. 119, 133 N.E. 52.)"

In Stacy v. F.M. Hoyt Shoe Co., 83 N.H. 281, 141 A. 467,469, the same contention as here made was considered under a statute reading: "In case the injured workman, or in event of his death his executor or administrator, shall avail himself of this chapter, either by accepting any compensation hereunder, by giving the notice hereinafter prescribed, or by beginning proceedings therefor in any manner on account of any such injury, he shall be barred from recovery in every action at common law or under any other statute on account of the same injury." The court, in speaking of it, said: "The suggested interpretation of the statute cannot be adopted. The Act concerns itself solely with mutual rights and liabilities based upon the relationship of master and servant. It does not purport to define, enlarge or restrict the rights of workmen against persons other than their employers, and it must, therefore, be held that the only actions which are barred by the acceptance of compensation are actions against the employer." This was adhered to in the later case of Holland v. MorleyButton Co., 83 N.H. 482, 145 A. 142.

In Davis v. Central Vermont Ry. Co., 95 Vt. 180,113 A. 539, 540, the court held that a statute much like our sections 2838 and 2839, aside from other statutes on the subject, "might well be taken to mean other rights and remedies which the employee had against the employer."

In the case of Silvia v. Scotten, 2 W.W. Harr. (32 Del.) 295, 122 A. 513, 514, the statute under consideration was materially different from ours, but what the court said has equal application here. It said: "When the purpose of the Workmen's Compensation Act is borne in mind it would be highly unreasonable to assume that in its enactment the legislature intended to save a class of wrongdoers who are in nowise related to the compensation scheme from the liability which the law had theretofore imposed upon them. The Workmen's Compensation Act concerns only employer and employee and is designed to afford a fair and equitable adjustment of their mutual rights and obligations, primarily for the benefit of the employee. A stranger to the employment is outside of the Act's contemplation, and his liabilities are not intended by the Act to be disturbed."

The supreme court of Utah, in Robinson v. Union P. Ry.Co., 70 Utah, 441, 261 P. 9, 13, while dealing with a statute differing from ours, said: "Workmen's Compensation Acts in the various jurisdictions of the country have gone a long way in the direction of depriving both employers and employees of their common-law remedies and defenses, especially as between themselves, but we are cognizant of no statute at present which has gone to the length of depriving an employee, or his dependents, of a remedy against one not engaged in the same employment and over whose business the employer of the injured employee has no control." Judge Straup in a concurring opinion said: "Our Industrial Act is a Workmen's Compensation Act and not an Exemption Act of strangers and tort-feasors exempting and releasing them as to one because in the employ of another, and on whom wrongs and torts are committed by them to his injury and damage."

The supreme court of Oregon placed the same interpretation upon a similar statute to ours before the amendment of 1925, as did the Bruce and Black Cases [King v. Union Oil Companyof California, 144 Or. 655, 24 P.2d 345,25 P.2d 1055], but did so largely upon the authority of the Washington and Bruce Cases. It reached the conclusion it did because of a statute very similar to our section 2863. It was section 2863 that formed the justification in the Bruce and Black Cases. In the Bruce Case this suggestion was made to the legislature: "If remedy is necessary, the legislature will give the subject attention." The legislature promptly repealed the provisions of section 2863, upon which emphasis was laid in the Bruce andBlack Cases (Chap. 121, Laws 1925), and in my opinion evinced its intention to permit an injured employee to recover against a negligent third person, whether the injury occurred off or on the premises of the employer.

In the majority opinion two reasons are suggested which may have influenced the legislature in depriving an injured employee of the right to sue a negligent third person. It is suggested that, briefly stated, the first reason is that of relieving the employee of the expense necessary in instituting and maintaining an action at law, and, second, to give definite assurance of financial relief unattended by the hazards of a lawsuit. These are the reasons which prompted the legislature to fix the rights of the employee against the employer. They furnish no ground or plausible excuse for awarding a medal of immunity to a negligent third party. Motives of benevolence and charity toward those who labor cannot well be manifested by depriving them of substantial rights. An interpretation of the statute — just but not generous to the employee — permits him to recover against a negligent third person.

The judgment should be affirmed.