380 U.S. 39 (1965), 116, Crider v. Zurich Insurance Co.

Docket Nº:No. 116
Citation:380 U.S. 39, 85 S.Ct. 769, 13 L.Ed.2d 641
Party Name:Crider v. Zurich Insurance Co.
Case Date:March 01, 1965
Court:United States Supreme Court

Page 39

380 U.S. 39 (1965)

85 S.Ct. 769, 13 L.Ed.2d 641



Zurich Insurance Co.

No. 116

United States Supreme Court

March 1, 1965

Argued January 19, 1965




Petitioner, an Alabama resident, was injured in that State while working for a Georgia corporation, against which he then secured a default judgment in an Alabama court under the Georgia Workmen's Compensation Act. Petitioner then brought this diversity action on the judgment against respondent, his employer's insurer, in the District Court, which granted a motion to dismiss on the ground that the Alabama court lacked jurisdiction to award damages under the Georgia Act providing for a remedy which could be afforded exclusively by the Georgia compensation board. The Court of Appeals affirmed.

Held: The State where an employee resides and is injured may adopt such choice of remedy as it desires, and Alabama was free to adopt and enforce the remedy provided by Georgia without any requirement imposed by the Full Faith and Credit Clause that the special Georgia procedure be followed. Pp. 41-43.

324 F.2d 499 reversed.

DOUGLAS, J., lead opinion

MR. JUSTICE DOUGLAS delivered the opinion of the Court.

Petitioner, a resident of Alabama and employed there by Lawler Construction Co., Inc., a Georgia corporation, was injured. Both he and Lawler were under Georgia's Workmen's Compensation Act at the time. Petitioner sued in an Alabama court under the Georgia Act and obtained a judgment by default against Lawler. Respondent, the insurer of Lawler, was sued in the Federal District

Page 40

Court by petitioner on his Alabama judgment, federal jurisdiction being based on diversity of citizenship. The District Court granted respondent's motion to dismiss (224 F.Supp. 87), and the Court of Appeals affirmed. 324 F.2d 499. The case is here on a writ of certiorari. 377 U.S. 942.

The District Court and the Court of Appeals stood on Green v. J. A. Jones Const. Co., 161 F.2d 359, which held that a Mississippi state court had no jurisdiction to award damages under the Georgia Workmen's Compensation Act, and that the Federal District Court for Mississippi was under the same disability, Georgia decisions settling the point that the remedy provided by the Georgia Act is "an exclusive one which can be afforded only" by the Georgia Compensation Board. Ibid.

We assume that the lower courts were correct in stating what the Georgia law is. But the mere fact that petitioner, if he had sued in Georgia, would have had to follow that course does not necessarily [85 S.Ct. 770] mean that the Alabama state court was in error in taking jurisdiction of the cause.

The Alabama state court dealt with an injury occurring to an Alabama resident while working in Alabama. Under Bradford Electric Light Co. v. Clapper, 286 U.S. 145, a State could fix one exclusive remedy for personal injuries involving its residents wherever the accident happened and the Full Faith and Credit Clause (Art. IV, § 1) required the other States to refuse to enforce any inconsistent remedy. That case would have been on all fours with the present one had petitioner been a resident of Georgia, rather than Alabama. Alaska Packers Assn. v. Industrial Acc. Commission, 294 U.S. 532, and Pacific Employers Ins. Co. v. Industrial Accident Commission, 306 U.S. 493, marks a break with the Clapper philosophy. Alaska Packers allowed the State of residence of the injured employee to supply a remedy different from the Compensation Act of the place of the injury, even though the employee had agreed to be

Page 41

bound by the latter remedy. Pacific Insurance held that a person injured while working in California could recover under California's Compensation Act even though the injured person was a Massachusetts resident, regularly employed there by a Massachusetts corporation, and even though the Massachusetts Compensation Act purported to give an exclusive remedy. In Carroll v. Lanza, 349 U.S. 408, Arkansas, the place where the injury occurred, was allowed to grant common law damages even though Missouri, the home State, had a Compensation Act that purported to be exclusive. As we stated in that case:

Missouri can make her Compensation Act exclusive, if she chooses, and enforce it as she pleases within her borders. Once that policy is extended into other States, different considerations come into play. Arkansas can adopt Missouri's policy if she likes. Or, as the Pacific Employers Insurance Co. case teaches, she may supplement it or displace it with another, insofar as remedies for acts occurring within her boundaries are concerned. Were it otherwise, the State where the injury occurred would be powerless to provide any remedies or safeguards to nonresident employees working within its borders. We do not think the Full Faith and Credit Clause demands that subserviency from the State of the injury.

Id., pp. 413-414.

The State where the employee lives and where he was injured has a large and considerable interest in the event. As we said in Carroll v. Lanza, supra, p. 413

The State where the tort occurs certainly has a concern in the problems following in the wake of the injury. The problems of medical care and of possible dependents are among these. . . .

The State where the employee lives has perhaps even a larger concern, for it is there that he is expected to return, and it is on his community that the impact of the injury is apt to be most keenly felt. Certainly,

Page 42

when the injury occurs in the home State of the employee, the interest of that State is at least commensurate with the interest of the State in which an injury occurs involving a nonresident, as in Carroll v. Lanza. If Arkansas had a sufficient interest there to override Missouri's exclusive remedy, Alabama may override Georgia's here.

The Alabama policy in that regard is reflected in the judgment rendered by the Alabama court on which this federal suit was instituted. That Alabama judgment adopted and enforced the remedy provided by Georgia -- a procedure we indicated [85 S.Ct. 771] in Pacific Employers Ins. Co. v. Industrial Accident Commission, supra, p. 500, a State might follow. Here, as in Alaska Packers Ass'n v. Industrial Accident Commission, supra, p. 544, " . . . the compensation acts of either jurisdiction may, consistently with due process, be applied in either. . . ." We were consistent with that view in Carroll v. Lanza, supra, when we said, in what we have already quoted, that the State of the forum may "supplement" or "displace" the remedy of the other State, consistently with constitutional requirements. 349 U.S., p. 414.

It is earnestly argued by the dissent that the Green decision, supra, which the Court of Appeals followed in the present case, "did not rest on constitutional grounds," post, p. 46. Rather, it is said that Green expresses merely a state conflicts rule. * We do not so read Green. There, the court said that its decision was controlled by

Page 43

the principle that,

where the provision for the liability claimed is coupled with a provision for a special remedy to be afforded not by a court, but by a commission, that remedy, and that alone, must be employed. . . .

161 F.2d 359. This principle is almost a verbatim restatement of the rule adverted to in Tennessee Coal, Iron & R. Co. v. George, 233 U.S. 354, 359: "where the provision for the liability is coupled with a provision for the special remedy, that remedy, that alone, must be employed." And our older cases assumed that this broad rule was compelled by the Full Faith and Credit Clause. See, e.g., ibid., and cases cited; Atchison, T. & S.F. R. Co. v. Sowers, 213 U.S. 55; and also the discussion in Pearson v. Northeast Airlines, Inc., 309 F.2d 553. But, as we have demonstrated, that rule has been eroded by the line of cases beginning with Alaska Packers and Pacific Insurance. Our holding frees the Court of Appeals on remand to reconsider its holding free from any supposed constitutional compulsion.


GOLDBERG, J., dissenting


The resolution of the issue before the Court in this case necessitates setting out the history of this litigation in more detail than does the Court. Petitioner originally brought his action against the employer in an Alabama court in a three-count complaint, the first count relying on Alabama's Workmen's Compensation Act, and the other two on Alabama common law. He then voluntarily dismissed these counts and reinstituted the action in the Alabama court with sole and express reliance on the Georgia Workmen's Compensation Act. A default judgment was then entered in petitioner's favor on the basis of this new complaint. No appeal was taken from this default judgment.

Page 44

Petitioner then filed a complaint in an Alabama court against respondent, the employer's insurance company, to enforce the previously obtained default judgment. Respondent asserted in defense that, since the Georgia Act upon which the action was based provides for primary jurisdiction in an administrative board and precludes original court jurisdiction, the Alabama court lacked subject matter jurisdiction to enter the default [85 S.Ct. 772] judgment. The default judgment, therefore, respondent contended, was void, and could be collaterally attacked in the enforcement proceeding. Petitioner's demurrer to this defense was overruled by the Alabama court. Following this, petitioner voluntarily dismissed the action in the Alabama court, and, the next day, filed the diversity suit here before us, identical to the previous Alabama action. Respondent again asserted the defense of lack of subject matter jurisdiction to enter the default judgment. Based on this defense, and after the submission of briefs and oral argument, Judge Grooms dismissed...

To continue reading