OCCIDENTAL INDEMNITY CO v. INDUSTRIAL ACCIDENT COMMISSION ET AL

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District Court of Appeal, Second District, Division 3, California.

OCCIDENTAL INDEMNITY CO. v. INDUSTRIAL ACCIDENT COMMISSION ET AL.

Civ. 14141.

Decided: November 16, 1943

Henry E. Kappler, of Los Angeles, for petitioner. Everett A. Corten and Fred Goldsworthy, both of San Francisco, for respondents.

Proceeding in review seeking annulment of award by Industrial Accident Commission to Steve Ruljanovich against petitioner herein, insurer of his employers, for injuries sustained in his employment as a seaman fisherman. Ruljanovich, until 7 or 8 years before his injury, was a fisherman, later an employee in a fish cannery, where he had been working until about two months before his injury. He was employed as a seaman fisherman by the owners of the fishing boat “Betsy Ross,” a tuna boat working out of San Pedro. As compensation he was to receive a percentage of the catch. On the day following the agreement of employment Ruljanovich went on the boat with others and did some work putting it into shape. They then went across the bay, took a truck and went to a warehouse to get the boat's tuna nets. While in the warehouse Ruljanovich was hit on the head by a falling timber and sustained injuries, for which compensation was awarded.

On the day he filed his application with the Industrial Accident Commission he filed in the United States District Court an action in rem and personam against the vessel and her owners, seeking a decree for the payment of wages, maintenance and cure. The fact that this action had been instituted was first brought to the attention of the Industrial Accident Commission upon petition of Occidental Indemnity Company for a rehearing. A rehearing was denied and on the same day Ruljanovich filed an amended libel alleging his employment, the occurrence of his injuries, and charging that the accident resulted from the combined negligence of the warehouse company and Frank Muljat, one of the owners and a member of the crew of the “Betsy Ross.” He sought a decree for the payment of wages, maintenance and cure and damages in the sum of $15,000.

The controlling question involved in the instant proceeding is whether the Industrial Accident Commission of California had jurisdiction of the proceeding before it, for the reason that Ruljanovich must seek redress through the admiralty jurisdiction of the United States District Court, because he is entitled to recover for his injuries under the Jones Act. Sec. 33, Merchant Marine Act of June 5, 1920, 41 Stat. 1007, c. 250, 46 U.S.C.A. § 688. That act provides: “Any seaman who shall suffer personal injury in the course of his employment may, at his election, maintain an action for damages at law, with the right of trial by jury, and in such action all statutes of the United States modifying or extending the common–law right or remedy in cases of personal injury to railway employees shall apply; * * *.” By this act the right was given to employees to recover for injuries resulting from negligence of their employers. Federal Employers' Liability Act, 45 U.S.C.A. §§ 51–60.

It is the contention of respondents that although Ruljanovich's injury arose out of and occurred in the course of his employment as a seaman fisherman, and although he was employed to fish upon the high seas, his right to recover from his employers is governed by the Workmen's Compensation Law as administered by the Industrial Accident Commission, because he was injured while on shore.

By the Jones Act the admiralty jurisdiction was broadened so as to add actions by seamen for the recovery of damages for personal injuries, due to negligence of the owner of a vessel, to the existing rights to receive maintenance and cure, and to recover damages for injuries sustained through the unseaworthiness of the vessel. If respondent's injuries were sustained under conditions bringing his claim for damages clearly within the admiralty jurisdiction, that jurisdiction is exclusive, under Article III, sec. 2, of the Constitution, which extends the judicial power of the United States “to all Cases of admiralty and maritime Jurisdiction,” Article I, sec. 8, which confers upon Congress power “To make all Laws which may be necessary and proper for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof,” and under sec. 9, Judiciary Act of 1789, 1 Stat. 76, 77; Judicial Code, secs. 24 and 256, 28 U.S.C.A. §§ 41, 371, under which the District Courts of the United States were given “exclusive original cognizance of all civil causes of admiralty and maritime jurisdiction, * * * saving to suitors, in all cases, the right of a common law remedy, where the common law is competent to give it.” Southern Pacific Co. v. Jensen, 1917, 244 U.S. 205, 37 S.Ct. 524, 61 L.Ed. 1086, L.R.A.1918C, 451, Ann.Cas.1917E, 900; Knickerbocker Ice Co. v. Stewart, 1920, 253 U.S. 149, 40 S.Ct. 438, 64 L.Ed. 834, 11 A.L.R. 1145; State of Washington v. Dawson & Co., 1924, 264 U.S. 219, 44 S.Ct. 302, 68 L.Ed. 646; Nogueira v. New York, N. H. & H. R. Co., 1930, 281 U. S. 128, 137, 50 S.Ct. 303, 74 L.Ed. 754, 760. Admittedly the injuries were sustained under conditions which would bring the case within the literal scope of the Workmen's Compensation Law.

The question of jurisdiction must be determined from a consideration of the nature of the services for which respondent was engaged, the nature of those in which he was injured, and the circumstances thereof. He was to serve as a seaman and a fisherman upon navigable waters, without any specific duties to be performed on shore, but presumably with such shore duties as were incidental to the preparation of the vessel for voyages and to the business of taking and discharging cargoes of fish. As a member of the crew he was assisting in taking aboard the vessel's nets which were essential to carrying on the business of fishing. This was a part of his duties as a seaman and well within the scope of his employment. He had been aboard the vessel for a brief time helping to fit her for a voyage, and the bringing of the nets aboard was no less a part of the outfitting of the vessel than would have been the storage of the nets after they had been brought aboard. The case on its facts is within the rules announced by the Supreme Court in O'Donnell v. Great Lakes Dredge & Dock Co., 1943, 318 U.S. 36, 63 S.Ct. 488, 87 L.Ed. 596. There a seaman employed on a sand ship had gone from the vessel to the dock in order to repair a gasket in a pipeline which was being used to unload the ship. While on the deck he received injuries through the negligence of a fellow employee. A judgment of the district court dismissing his action for damages against the employer was reversed. The court said in part (at page 489 of 63 S.Ct.): “The question for decision is whether a seaman injured on shore while in the service of his vessel is entitled to recover for his injuries in a suit brought against his employer under the Jones Act. * * * [492 of 63 S.Ct.] The right of recovery in the Jones Act is given to the seaman as such, and, as in the case of maintenance and cure, the admiralty jurisdiction over the suit depends not on the place where the injury is inflicted but on the nature of the service and its relationship to the operation of the vessel plying in navigable waters. See Waring v. Clarke, 5 How. 441, 12 L.Ed. 226, and New England Mut. M. Ins. Co. v. Dunham, 11 Wall. 1, 20 L.Ed. 90, supra. * * * [and at page 490 of 63 S.Ct.%BD The term ‘seamen’ has been interpreted to embrace those employed on a vessel in rendering the services customarily performed by seamen, including stevedores while temporarily engaged in stowing cargo on the vessel. International Stevedoring Co. v. Haverty, 272 U.S. 50, 47 S.Ct. 19, 71 L.Ed. 157; Buzynski v. Luckenbach S. S. Co., 277 U.S. 226, 48 S.Ct. 440, 72 L.Ed. 860. There is nothing in the legislative history of the Jones Act to indicate that its words ‘in the course of his employment’ do not mean what they say or that they were intended to be restricted to injuries occurring on navigable waters.”

Respondents contend that Ruljanovich was not engaged in the service of his vessel at the time of his injury because he was on shore, and they rely upon findings of the commission that “1. Steve Ruljanovich, applicant, while employed as a seaman fisherman, * * * sustained injury arising out of and occurring in the course of said employment when he was struck on the head by a timber. * * * 2. Said employee at the time of the injury was not engaged in work in connection with his occupation as seaman and said injury did not occur on a vessel or on navigable waters outside of the State of California but within the boundaries of the State of California, and therefore this Commission has jurisdiction in this proceeding.” Respondents contend, and properly, that the findings, read together, mean that Ruljanovich was injured in the course of his employment as a seaman fisherman but that the injury was not sustained while he was on the vessel or on navigable waters. Apparently it was the contention of respondents at the time of the hearing before the commission, which was before the decision in the O'Donnell case, that the fact that Ruljanovich was on shore established the jurisdiction of the state commission as against that of the Federal court. But even if such had been assumed to be the law after the passage of the Jones Act, as it unquestionably was before that time, it is no longer the law, since the maritime jurisdiction has been broadened and it has been decided that it is the nature of the service and its relationship to the operation of the vessel, and not the place where the injury is inflicted, that determines the question of jurisdiction.

The finding of the commission that Ruljanovich was injured in the course of his employment, having substantial support in the evidence, is conclusive. But respondents argue, as we understand it, that this finding should be construed, if possible, so as to support the decision of the commission that it had jurisdiction of the case. They urge that there is a strong presumption that the commission has not made an application of the Workmen's Compensation Act, Labor Code, § 3201 et seq., St. 1937, p. 265 et seq., which invades the constitutional jurisdiction of the federal courts and that we should allow that presumption to control our decision of the case. They rely upon Davis v. Department of Labor and Industries of Washington, 1942, 317 U.S. 249, 63 S.Ct. 225, 87 L.Ed. 246, where state jurisdiction was upheld after it had been denied by the Industrial Accident Commission and the courts of the State of Washington. The facts of that case were that Davis, a structural steel worker, while engaged in examining and cutting steel after it had been lowered to a barge anchored in a navigable river, in the process of dismantling an abandoned drawbridge, fell or was knocked into the stream and drowned. He had been helping to cut steel from the bridge before taking up his duties on the barge. The court had before it for consideration the Workmen's Compensation Law of Washington, particularly the provision thereof which granted compensation to “all employers and workmen * * * engaged in maritime occupations for whom no right or obligation exists under the maritime laws” (Rem.Rev.Stat.(Wash.) secs. 7674, 7693a) and also the Federal Longshoremen's and Harbor Workers' Compensation Act, 33 U.S.C.A. § 901 et seq., which provides § 903): “Compensation shall be payable under this chapter in respect of disability or death of an employee, but only if the disability or death results from an injury occurring upon the navigable waters of the United States (including any dry dock) and if recovery for the disability or death through workmen's compensation proceedings may not validly be provided by State law.”

The court determined that the state law, under the facts of Davis' employment and death, did not encroach upon the maritime jurisdiction of the Federal courts to a forbidden extent. This conclusion was reached by way of reaffirmance of the rule first stated in Southern Pacific Co. v. Jensen, supra, 244 U.S. 205, at page 216, 37 S.Ct. 524, at page 529, 61 L.Ed. 1086, 1098, L.R.A.1918C, 451, Ann.Cas. 1917E, 900: “Equally well established is the rule that state statutes may not contravene an applicable act of Congress or affect the general maritime law beyond certain limits. * * * And plainly, we think, no such legislation is valid if it contravenes the essential purpose expressed by an act of Congress, or works material prejudice to the characteristic features of the general maritime law, or interferes with the proper harmony and uniformity of that law in its international and interstate relations. This limitation, at the least, is essential to the effective operation of the fundamental purposes for which such law was incorporated into our national laws by the Constitution itself.” Of this rule it was said in the Davis case (page 227 of 63 S.Ct.): “When a state could and when it could not grant protection under a compensation act was left as a perplexing problem, for it was held ‘difficult, if not impossible’ to define this boundary with exactness. * * * Harbor workers and longshoremen employed ‘in whole or in part, upon the navigable waters' are clearly protected by this Federal Act; but, employees such as decedent here occupy that shadowy area within which, at some undefined and undefinable point, state laws can validly provide compensation. This Court has been unable to give any guiding, definite rule to determine the extent of state power in advance of litigation, and has held that the margins of state authority must ‘be determined in view of surrounding circumstances as cases arise.’ * * * [page 229 of 63 S.Ct.%BD The Longshoremen's Act passed with specific reference to the Jensen rule, provided a partial solution. The Washington statute represents a state effort to clarify the situation. Both of these laws show clearly that neither was intended to encroach on the field occupied by the other. But the line separating the scope of the two being undefined and undefinable with exact precision, marginal employment may, by reason of particular facts, fall on either side. * * * There is, in the light of the cases referred to [consisting of a multitude in which support for the position of each of the parties in the Davis case was to be found], clearly a twilight zone in which the employees must have their rights determined case by case, and in which particular facts and circumstances are vital elements. That zone includes persons such as the decedent who are, as a matter of actual administration, in fact protected under the state compensation act.”

In sustaining the application of the Washington act, the court relied upon a presumption in favor of the constitutionality of the state statute and upon the fact that the federal authorities had taken no action in the case under the Longshoremen's Act. The court said (page 230 of 63 S.Ct.): “Under all the circumstances of this case we will rely on the presumption of constitutionality in favor of this state enactment; for any contrary decision results in our holding the Washington act unconstitutional as applied to this petitioner. A conclusion of unconstitutionality of a state statute can not be rested on so hazardous a factual foundation here any more than in the other cases cited. Giving the full weight to the presumption, and resolving all doubts in favor of the Act, we hold that the Constitution is no obstacle to the petitioner's recovery.”

We consider it to be unnecessary to engage upon an analysis of the facts of those cases in which workmen were held to be and those in which they were held not to be engaged in maritime employment. There is no doubt or uncertainty as to the nature of the services which Ruljanovich was to render under his employment or of those he was rendering at the time of his injury. They were definitely and exclusively services in the operation of the “Betsy Ross” in the business of fishing for tuna. They were no less exclusively maritime in character than were the services of O'Donnell for the Great Lakes Dredge & Dock Co. If we were to sustain the award made by the state commission as within its jurisdiction, it would have to be solely upon the theory of the presumption of constitutionality, as was done in the Davis case, and upon facts essentially different. From all of the facts that appear in that case, the services of Davis were to be performed both on shore, that is to say, a drawbridge, and upon a barge. He worked first at one place and then at the other and his work on shore, consisting of cutting steel, might well have been considered the principal work that he had to do in dismantling the bridge and not merely incidental to the carrying away of the steel by barge. However, it would seem that part–time work on the barge would have brought him within the Longshoremen's and Harbor Workers' Compensation Act and the opinion is open to the construction that in certain doubtful cases a recovery may be had under either state or federal laws. Under rules which are firmly established this could not be true of a case which, under the facts, was clearly within one jurisdiction and not the other, as where the duties of the seaman were exclusively, or were not at all, in the service of the ship. The work of Ruljanovich was strictly in the service of the vessel. His bringing the nets aboard was a necessary part of that service and not merely incidental to it. To apply the state law to his case would deprive the federal courts of their exclusive jurisdiction and would set up a rule of concurrent jurisdiction in all cases where a seaman engaged in exclusively maritime service receives injury while performing duties on land. To sustain the award of the state commission would deprive Ruljanovich of his right to sue for damages for negligence under the Jones Act and would substitute for that right the remedies of the State Compensation law. The suggestion of respondents that he may recover some of his damage under the state law and the remainder through action in the federal court assumes, at least, that the jurisdictions overlap, which we have seen is not the case.

Our conclusion is that the action of Ruljanovich for damages based upon the alleged negligence of his employers is clearly within the jurisdiction of the United States District Court and that therefore the award made in his favor by respondent commission constituted an unconstitutional application of the California Workmen's Compensation Law; that the award is void and should be annulled.

The award is annulled.

SHINN, Acting Presiding Justice.

PARKER WOOD, J., and SHAW, Justice pro tem., concur.