Aetna Life Ins Co v. Moses

• Decision Date: 09 January 1933
• Docket Number: No. 137,137
• Citation: 88 A.L.R. 647,77 L.Ed. 477,287 U.S. 530,53 S.Ct. 231
• Parties: AETNA LIFE INS. CO. et al. v. MOSES
• Court: U.S. Supreme Court

287 U.S. 530

53 S.Ct. 231

77 L.Ed. 477

AETNA LIFE INS. CO. et al.

v MOSES.

No. 137.

Argued Dec. 8, 1932.

Decided Jan. 9, 1933.

Messrs. Charles W. Arth and Leonard J. Ganse, both of Washington, D.C., for petitioners.

[Argument of Counsel from pages 531-532 intentionally omitted] Mr. H. Clay Espey, of Washington, D.C., for respondent.

[Argument of Counsel from pages 533-535 intentionally omitted] Mr. Justice STONE delivered the opinion of the Court.

Roberts, an employee of petitioner Bralove, was killed in the course of his employment by the alleged negligence of respendent. His widow, who was also his administratrix, claimed and has accepted an award of compensation under the Longshoremen's and Harbor Workers' Compensation Act (March 4, 1927, c. 509, 44 Stat. 1924 (33 USCA §§ 901—950)), made applicable as a workmen's compensation law in the District of Columbia by Act of May 17, 1928, c. 612, 45 Stat. 600 (33 USCA § 901 note, and D.C. Code 1929, T. 19, §§ 11, 12). The award directed the employer and petitioner the AEtna Life Insurance Company, his insurer,¹ to pay compensation to the widow in periodic installments, and the expenses attendant upon the burial of the deceased.

The present suit was brought in the Supreme Court of the District of Columbia on the theory that the acceptance of compensation awarded under the statute operated as an assignment of the administratrix' right to pursue the respondent for damages for the wrongful death, and that the insurer succeeded to that right by subrogation. The declaration named as plaintiffs petitioner the AEtna Life Insurance Company 'in its own right and also to the use of' the widow 'in her own right and as administratrix' and petitioner Bralove 'to the use of' the insurance company. Respondent moved to strike the declaration for misjoinder of parties plaintiff and causes of action. The trial court sustained the motion on the first ground, and, as petitioners elected to stand on the declaration, gave judgment for the respondent, which the Court of Appeals affirmed, 61 App. D.C. 74, 57 F.(2d) 440. This Court granted certiorari. 287 U.S. 582, 53 S.Ct. 15, 77 L.Ed. —-.

Both courts below ruled that the administratrix is, by the terms of the District Death Act (23 Stat. 307, D.C. Code (1924), §§ 1301, 1302, 1303 (D.C. Code 1929, T. 21, §§ 1—3)), the only proper plaintiff in an action for wrongful death, and that the Compensation Act, though it assigns the cause of action for the death, to the employer, upon acceptance of the award, does not under the common-law practice prevailing in the District, permit him to bring the suit in his own name. The trial court further expressed the view that the insurer was without any interest in the litigation, by way of subrogation, since the cause of action for wrongful death is not assignable at common law, and the Compensation Act confers on the insurer no rights analogous to those given the employer. The question before us is whether the Court of Appeals was right, and, if not, whether the proper parties have been designated as plaintiffs.

Sections 7, 8, and 9 of the Compensation Act (33 USCA §§ 907 909) provide for compensation to the employee if he is injured, or to certain of his dependents, if he is killed, in the course of his employment. Section 33(a) provides that 'if on account of a disability or death for which compensation is payable * * * the person entitled to such compensation determines that some person other than the employer is liable in damages, he may elect * * * to receive such compensation or to recover damages against such third person.' By subsection (b) 'Acceptance of such compen- sation shall operate as an assignment to the employer of all right of the person entitled to compensation to recover damages against such third person,' and by subsection (d) the 'employer on account of such assignment may either institute proceedings for the recovery of such damages or may compromise with such third person.' 33 USCA § 933(a, b, d, e).

But the cause of action against a third party which is thus cast upon the employer is not to be maintained exclusively for his own benefit. From the proceeds of the litigation or compromise the employer is directed by section 33(e) to retain an amount equal to his disbursements in securing them, the cost of benefits furnished by him to the employee, amounts paid as compensation, and the present value of all amounts which it is estimated are payable as such. The latter sum is to be held by the employer 'as a trust fund to pay such compensation as it becomes due and to pay any sum, in excess of such compensation, to the person entitled to compensation or to the representative.' Any amount recovered above that required for these purposes is to be paid by the employer directly 'to the person entitled to compensation or to the representative.'

In the case where the employee survives and accepts compensation as the only person entitled, it is clear that the statutory assignment vests in the employer the full right to recover damages from the third person. Double recovery by the employee, compare Mercer v. Ott, 78 W.Va. 629, 89 S.E. 952; Fox v. Dallas Hotel Co., 111 Tex. 461, 240 S.W. 517, is thus avoided. Yet the employer is permitted to share in the recovery only to the extent of his own liability, compare Travelers' Insurance Co. v. Brass Goods Mfg. Co., 239 N.Y. 273, 146 N.E. 377, 37 A.L.R. 826, and any excess goes to the injured employee.

In this case the injury resulted in death of the employee, and the election to take compensation was made by the widow. As she is both the administratrix and the only person entitled to compensation, the election was validly exercised and we need not resolve possible doubts as to the proper person to make the election under other circumstances. Compare sections 33(a) and (b) with (f). Her election has called into operation the statutory assignment so far as it applies to the action for wrongful death. We must decide its effect on that cause of action.

The statute is not free from ambiguity. The right to recover for a wrongful death is the creature, not of the common law, but of a statute which confers the right on the personal representative of the deceased for the benefit of his next of kin under the local statute of distribution, some of whom may not be entitled to compensation under the Compensation Act. Nevertheless, section 33(b) of the act provides that it is the 'right of the person entitled to compensation to recover damages against such third person' which is assigned to the employer by the election to take compensation. Reading this provision literally and alone, the employer, in the case of the wrongful death of his employee, would take nothing by the assignment which it purports to effect, since the person entitled to the compensation has no right to recover for the death. But section 33(d) authorizes the employer to institute suit or to compromise the claim, and section 33(e)(1)(C) and (e)(2) provide that any recovery in excess of the sums required to reimburse the employer and allow for compensation payable by him is to be paid to the representative of the deceased. Having regard to those provisions and to the general purpose which the act discloses with respect to rights of recovery when the injury does not result in death, we see no escape from the conclusion that the statute contemplates that the employer is to have the same control over the institution of an action for wrongful death, the compromise and settlement of the claim, and the distribution of the proceeds, as he is given in unambiguous language in the case where the injury results only in disability. What is made explicit by the statute with respect to the latter is implicit with respect to the former. For, if it had been intended that the employer should assert only a part of the action for wrongful death, proportionate to the interest of those who are dependents under the Compensation Act, compare Matter of Zirpola v. Casselman, 237 N.Y. 367, 143 N.E. 222; United States Fidelity & Guaranty Co. v. Graham & Norton Co., 254 N.Y. 50, 171 N.E. 903, there would be no meaning to the language of section 33(e)(2) directing him to pay to the personal representative from the proceeds of the action any excess over the compensation award.

Concluding that, where the employer is given anything to recover, it is the full recovery provided by the Wrongful Death Act, we do not think, as did the courts below, that the rights thus conferred may be enforced only by an action brought in the name of the personal representative. It is true that the statute does not expressly say that the employer may bring the action in his own name and that by the common law the assignee must, in general, sue in the name of the assignor. Glenn v. Marbury, 145 U.S. 499, 12 S.Ct. 914, 36 L.Ed. 790. This rule a vestige of the common law's reluctance to admit that a chose in action may be assigned, is to-day but a formality which has been widely abolished by legislation. We see no reason for thinking that a statute passed in 1928 and clearly intended to effect a complete transfer of the cause of action, should be interpreted to perpetuate that formality. There is nothing in its language, history, or purpose to indicate that the word 'assignment' was used as anything other than a convenient description of the transfer to the employer of the rights of the employee or his representative, or that it is to be read in the common-law sense, merely because the forum for the enforcement of those rights has not departed from the common-law form in the case of voluntary assignments.

It is immaterial whether the statutory assignment is said to create a new cause of action in the employer or merely to permit him to enforce that previously vested...