Mountain Timber Company v. State of Washington 1916

• Decision Date: 13 November 1916
• Docket Number: No. 13,13
• Citation: 37 S.Ct. 260,243 U.S. 219,61 L.Ed. 685
• Parties: MOUNTAIN TIMBER COMPANY, Plff. in Err., v. STATE OF WASHINGTON. Argued March 1 and 2, 1916. Restored to docket for reargument
• Court: U.S. Supreme Court

243 U.S. 219

37 S.Ct. 260

61 L.Ed. 685

MOUNTAIN TIMBER COMPANY, Plff. in Err.,

v STATE OF WASHINGTON.

No. 13.

Argued March 1 and 2, 1916.

Restored to docket for reargument November 13, 1916.

Reargued January 30, 1917.

Decided March 6, 1917.

[Syllabus from pages 219-221 intentionally omitted] Messrs. F. Markoe Rivinus, Theodore W. Reath, Coy Burnett, and Edmund C. Strode for plaintiff in error.

Mr. W. V. Tanner, Attorney General of Washington, for defendant in error.

[Argument of Counsel from pages 222-227 intentionally omitted] Mr. Justice Pitney delivered the opinion of the court:

This was an action brought by the state against plaintiff in error, a corporation engaged in the business of logging timber and operating a logging railroad and a sawmill having power-driven machinery, all in the state of Washington, to recover under chap. 74 of the Laws of 1911, known as the Workmen's Compensation Act, certain premiums based upon a percentage of the estimated pay roll of the workmen employed by plaintiff in error during the three months beginning October 1, 1911. Plaintiff in error by demurrer raised objections to the act, based upon the Constitution of the United States. The supreme court of Washington overruled them, and affirmed a judgment in favor of the state (75 Wash. 581, L.R.A. ——, ——, 135 Pac. 645, 4 N. C. C. A. 811), following its previous decision in State ex rel. Davis-Smith Co. v. Clausen, 65 Wash. 156, 37 L.R.A.(N.S.) 466, 117 Pac. 1101, 2 N. C. C. A. 823, 3 N. C. C. A. 599; and the case comes here under § 237, Judicial Code [36 Stat. at L. 1156, chap. 231, Comp. Stat. 1913, § 1214].

The act establishes a state fund for the compensation of workmen injured in hazardous employment, abolishes, except in a few specified cases, the action at law by employee against employer to recover damages on the ground of negligence, and deprives the courts of jurisdiction over such controversies. It is obligatory upon both employers and employees in the hazardous employments, and the state fund is maintained by compulsory contributions from employers in such industries, and is made the sole source of compensation for injured employees and for the dependents of those whose injuries result in death. We will recite its provisions to an extent sufficient to show the character of the legislation.

The 1st section contains a declaration of policy, reciting that the common-law system governing the remedy of workmen against employers for injuries received in hazardous work is inconsistent with modern industrial conditions, and in practice proves to be economically unwise and unfair; that the remedy of the workman has been uncertain, slow, and inadequate; that injuries in such employments, formerly occasional, have become frequent and inevitable; and that the welfare of the state depends upon its industries, and even more upon the welfare of its wage workers. 'The state of Washington, therefore, exercising herein its police and sovereign power, declares that all phases of the premises are withdrawn from private controversy, and sure and certain relief for workmen, injured in extra hazardous work, and their families and dependents is hereby provided regardless of questions of fault and to the exclusion of every other remedy, proceeding or compensation, except as otherwise provided in this act; and to that end all civil actions and civil causes of action for such personal injuries and all jurisdiction of the courts of the state over such causes are hereby abolished, except as in this act provided.'

The 2d section, declaring that while there is a hazard in all employment, certain employments are recognized as being inherently constantly dangerous, enumerates those intended to be embraced within the term 'extra hazardous,' including factories, mills, and workshops where machinery is used, printing, electrotyping, photoengraving and stereotyping plants where machinery is used; foundries, blast furnaces, mines, wells, gas works, waterworks, reduction works, breweries, elevators, wharves, docks, dredges, smelters, powder works, logging, lumbering, and shipbuilding operations, logging, street, and interurban railroads, steamboats, railroads, and a number of others; at the same time declaring that if there be or arise any extra hazardous occupation not enumerated, it shall come under the act, and its rate of contribution to the accident fund shall be fixed by the department created by the act upon the basis of the relation which the risk involved bears to the risks classified, until the rate shall be fixed by legislation. The 3d section contains a definition of terms, and, among them: 'Workman means every person in this state, who, after September 30, 1911, is engaged in the employment of an employer carrying on or conducting any of the industries scheduled or classified in § 4, whether by way of manual labor or otherwise, and whether upon the premises or at the plant, or, he being in the course of his employment, away from the plant of his employer;' with a proviso giving to a workman injured while away from the plant through the negligence or wrong of another not in the same employ, or, if death result from the injury, to his widow, children, or dependents, an election whether to take under the act or to seek a remedy against the third party. 'Injury' is defined as an injury resulting from some fortuitous event, as distinguished from the contraction of disease.

Section 4 contains a schedule of contribution, reciting that industry should bear the greater portion of the burden of the cost of its accidents, and requiring each employer prior to January 15th of each year to pay into the state treasury, in accordance with the schedule, a sum equal to a percentage of his total pay roll for the year, 'the same being deemed the most accurate method of equitable distribution of burden in proportion to relative hazard.' The application of the act as between employers and workmen is made to date from the 1st day of October, 1911, the payment for that year to be made prior to that date and upon the basis of the pay roll of the last preceding three months of operation. At the end of each year an adjustment of accounts is to be made upon the basis of the actual pay roll. The schedule divides the various occupations into groups, and imposes various percentages upon the different groups, the lowest being 1 1/2 per cent, in the case of the textile industries, creameries, printing establishments, etc., and the highest being 10 per cent, in the case of powder works. The same section establishes forty-seven different classes of industry, and declares:

'For the purpose of such payments accounts shall be kept with each industry in accordance with the classification herein provided and no class shall be liable for the depletion of the accident fund from accidents happening in any other class. Each class shall meet and be liable for the accidents occurring in such class. There shall be collected from each class as an initial payment into the accident fund as above specified on or before the 1st day of October, 1911, one fourth of the premium of the next succeeding year, and one twelfth thereof at the close of each month after December, 1911: Provided, any class having sufficient funds credited to its account at the end of the first three months or any month thereafter, to meet the requirements of the accident fund, that class shall not be called upon for such month. In case of accidents occurring in such class after lapsed payment or payments said class shall pay the said lapsed or deferred payments commencing at the first lapsed payment, as may be necessary to meet such requirements of the accident fund. The fund thereby created shall be termed the 'accident fund' which shall be devoted exclusively to the purpose specified for it in this act. In that the intent is that the fund created under this section shall ultimately become neither more nor less than self-supporting, exclusive of the expense of administration, the rates in this section named are subject to future adjustment by the legislature, and the classifications to rearrangement following any relative increase or decrease of hazard shown by experience.¹ . . . If, after this act shall have come into operation, it is shown by experience under the act, because of poor or careless management, any establishment or work is unduly dangerous in comparison with other like establishments or works, the department may advance its classification of risks and premium rates in proportion to the undue hazard. In accordance with the same principle, any such increase in classification or premium rate, shall be subject to restoration to the schedule rate. . . . If, at the end of any year, it shall be seen that the contribution to the accident fund by any class of industry shall be less than the drain upon the fund on account of that class, the deficiency shall be made good to the fund on the 1st day of February of the following year by the employers of that class in proportion to their respective payments for the past year.'

Section 5 contains a schedule of the compensation to be awarded out of the accident fund to each injured workman, or to his family or dependents in case of his death, and declares that except as in the act otherwise provided, such payment shall be in lieu of any and all rights of action against any person whomsoever. Where death results from the injury, the compensation includes the expenses of burial, not exceeding $75 in any case, a monthly payment of $20 for the widow or invalid widower, to cease at remarriage, and $5 per month for each child under the age of sixteen years until that age is reached, but not exceeding $35 in all, with a lump sum of $240 to a widow upon her remarriage; if the workman leaves no wife or husband, but a child or children under the age of sixteen years, there is to be a monthly payment of $10 to each child until that age is reached, but not...