Austin v. W. Biddle Walker Co., Docket No. 3165

• Decision Date: 26 April 1968
• Docket Number: No. 1,Docket No. 3165,1
• Citation: 11 Mich.App. 311,161 N.W.2d 150
• Parties: Clarence AUSTIN, Plaintiff-Appellee, v. W. BIDDLE WALKER COMPANY and Liberty Mutual Insurance Company, Defendants-Appellants
• Court: Court of Appeal of Michigan — District of US

Page 150

161 N.W.2d 150

11 Mich.App. 311

Clarence AUSTIN, Plaintiff-Appellee, v. W. BIDDLE WALKER COMPANY and Liberty Mutual Insurance

Company, Defendants-Appellants.

Docket No. 3165.

Court of Appeals of Michigan, Division No. 1.

April 26, 1968.

Released for Publication Sept. 27, 1968.

Leave to Appeal Denied Aug. 1, 1968.

E. R. Whinham, Jr., Lacey & Jones, Detroit, for appellants.

A. Leon Peck, Detroit, for appellee.

Before LEVIN, P.J., and GILLIS and QUINN, JJ.

GILLIS, Judge.

The sole issue on this appeal is whether the Michigan Workmen's compensation appeal board has jurisdiction over a nonresident claimant who was injured while working in Kentucky under a Michigan contract of hire.

Clarence Austin, the claimant and plaintiff herein, was hired by defendant, W. Biddle Walker Company, in Ecorse, Michigan. After plaintiff had worked a short time at Kalamazoo, Michigan, defendant-employer sent him to a job site in Louisville, Kentucky. On December 31, 1962, while in the course of his employment with the company, plaintiff fell from a construction scaffold and was injured.

The parties are in agreement that plaintiff was at all relevant times a Kentucky resident, maintaining his home with his wife and children in Wickliffe, Kentucky. There is also no dispute that plaintiff applied for, and was receiving benefits under the Kentucky workmen's compensation act.

In November, 1963, plaintiff claimed benefits under the Michigan workmen's compensation act and filed an application for hearing and adjustment of claim with the Michigan workmen's compensation department. The referee dismissed the application for lack of jurisdiction on the basis that claimant was a nonresident and the injury occurred out of State. The workmen's compensation appeal board reversed the jurisdictional ruling on the basis that under the Michigan act the claimant need only have been injured while employed under a Michigan contract of hire. From the award of compensation benefits by the appeal board, ¹ the employer and compensation carrier have appealed to this Court.

Part 3, § 19, of the Michigan workmen's compensation act provides:

'The industrial accident board ² shall have jurisdiction over all controversies arising out of injuries suffered without the territorial limits of this state, in those cases where the injured employee is a resident of this state at the time of the injury, and the conract of hire was made in this state, and any such employee or his dependents shall be entitled to the compensation or death benefits provided by this act.' C.L.1948, § 413.19 (Stat.Ann.1960 Rev. § 17.193).

Although this provision on its face requires residency as a condition of benefits under the Michigan act, it has not been so construed by the Michigan Supreme Court. Plaintiff cites Roberts v. I.X.L. Glass Corp. (1932), 259 Mich. 644, 244 N.W. 188, as compelling a decision that residency is not a requirement so long as the employment contract was made in Michigan.

Defendants contend that Roberts is no longer the law because of its inapplicability to our present statute or because of having been Sub silentio overruled by 3 later decisions of our Supreme Court: Cline v. Byrne Doors, Inc. (1949), 324 Mich. 540, 37 N.W.2d 630, 8 A.L.R.2d 617; Daniels v. Trailer Transport Company (1950), 327 Mich. 525, 42 N.W.2d 828; and Wagner v. LaSalle Foundry Company (1956), 345 Mich. 185, 75 N.W.2d 866.

Roberts v. I.X.L. Glass Corp., supra, is squarely on point. The jurisdiction provision in Roberts (C.L.1929, § 8458) is identical to our present provision. The opinion is prefaced with:

'The sole question presented is whether an employee whose contract for employment is entered into in Michigan with a resident employer, who is under the workmen's compensation act * * * for services to be rendered wholly outside of the State of Michigan is within the terms of the act so that, if otherwise entitled thereto, he may be awarded compensation notwithstanding the accident occurred in another State and that the employee was at no time a resident of Michigan.' Roberts, supra, 259 Mich., pp. 644, 645, 244 N.W., p. 189.

The Court held the act applicable. The jurisdiction provision was, in the Court's opinion, in conflict with the then-existent part 1, § 6 of the act which set out the scope and effect of the compensation provisions. At the time Roberts was decided, the act was not mandatory on Michigan employers but rather gave them an election whether or not to be bound under its terms. The conditions of electing to be bound under the act were spelled out in part 1, § 6:

'Such election on the part of the employers mentioned * * * shall be made by filing * * * a written statement to the effect that such employer accepts the provisions of this act For all his businesses * * * in which he may engage and all employees he may employ while he remains under this act.' (Emphasis supplied.)

Defendants argue that the fact that the act is now mandatory necessitates a contrary result to that reached in Roberts. It is true that the Court placed great reliance on the above section 6, but it does not seem to us that the emphasis or decision was placed on the contractual nature of the act. Rather the Court based its decision on the portion of section 6 which used the phrase 'all employees.'

In 1921 when the jurisdictional provision was added to the act, the legislature also re-enacted part 1, § 7 (C.L. 1929, § 8413) which then provided:

'The term 'employee' as used in this act shall be construed to mean: * * * Every person in the service of another, under any contract of hire, express or implied.'

The Court held, in construing these various provisions (259 Mich. 644, 648, 649, 244 N.W. 188, 190):

'If the 1921 amendment were to be construed in accordance with appellants' contention it would work a radical change in the scope and effect of the act. We cannot conceive of the legislature intending or attempting to accomplish such a result inferentially, as it were, by including the single quoted phrase in section 19 of part 3. If the legislature intended to so amend the statute, clearly it required a change in section 6 of part 1, above quoted, which is in no way referred to or changed by the amendatory act. That the legislature did not intend by the 1921 amendment (addition of the jurisdictional provision) to modify the act in the manner appellants assert is almost conclusively disclosed by the fact that the amendatory act covers section 7 of part 1; and, as above stated, again re-enacted that portion which defines as an employee 'every person in the service of another, under any contract of hire.' This re-enacted portion of section 7 is in full harmony with the original provision in section 6 that the employer's election to come under the act is an election 'to cover and protect All employees employed in any and all * * * businesses' of the employer. While it must be conceded that there is some conflict between the various quoted provisions of the act as amended, we are satisfied that the reasonable construction and the one necessary to carry out the legislative intent appearing from the whole act is that it covers nonresident as well as resident employees in those cases wherein the contract of employment is entered into in this State with a resident employer.'

Section 6 of part 1 has since been repealed (P.A.1943, No. 245) and the act made obligatory upon employers C.L.1948, § 411.2 (Stat.Ann.1960 Rev. § 17.142). But the provisions of part 1, § 7, as above quoted have been continued: C.L.1948, § 411.7(2), as amended by P.A.1955, No. 122 (Stat.Ann.1960 Rev. § 17.147(2)).

The same inconsistency facing the Court in the Roberts Case still exists in the act. Section 7 makes the act applicable to 'every person in the service of another, under any contract of hire.' Section 19 of part 3 still purports to limit the jurisdiction to 'cases where the injured employee is a resident of this state at the time of the injury.' Even though the act is now obligatory, the same substantive scope as to employees covered is contained in the act. There being no further legislative intent indicated, Roberts, if not overruled, is controlling.

Cases cited by defendants do not vitiate the precise holding of Roberts. In Cline v. Byrne Doors, Inc., supra, the plaintiff-employee was a resident of this State who was working in Florida when the injury occurred. The two questions before the Court were whether the contract of hire was made in this State and if acceptance of Florida benefits barred claimant's right to seek benefits under the Michigan act.

Daniels v. Trailer Transport Co., supra, does not decide the issue in point. There plaintiff was a resident of Illinois, the contract of hire was made in Texas and the injury was in Texas. Although the first headnote seems on point for defendants, that headnote was merely repeating the statute quoted by the Court (§ 19) and not the decision of the Court.

The Court does refer to Cline as being 'the only decision in Michigan after the effective date of P.A.1943, No. 245 (compulsory act) which considers the extraterritorial operation of the workmen's compensation act.' But, any change in prior law because of the compulsory nature of the amended act was not a matter of decision by the Court. Cline was cited for the proposition that the right to compensation depends on whether the contract for hire was made in this State, but the earlier Roberts decision is authority for the same proposition (259 Mich. 644, 649, 244 N.W. 188). And although the Court in Daniels referred to the noncontractual nature of the act, the manner of becoming obligated does not appear to change the result reached in Roberts as to the requirement of a Michigan contract of hire, and the Court's language indicating such significance does not appear to be material to the decision. Daniels and Cline are both wholly consistent with Roberts insofar as the actual issues decided in those...