Byrne v. Metcalfe Const. Co.

• Decision Date: 10 September 1951
• Docket Number: Civ. No. 68-46.
• Citation: 99 F. Supp. 635
• Parties: BYRNE et al. v. METCALFE CONST. CO. et al.
• Court: U.S. District Court — District of Nebraska

99 F. Supp. 635

BYRNE et al. v. METCALFE CONST. CO. et al.

Civ. No. 68-46.

United States District Court D. Nebraska, Omaha Division.

September 10, 1951.

James F. Green (of Webb & Kelley), Omaha, Neb., for plaintiffs.

Leo Eisenstatt (of Kennedy, Holland, DeLacy & Svoboda), Omaha, Neb., for defendants.

DONOHOE, Chief Judge.

This action was instituted by Cyril J. Byrne, James W. Tillery, Fritz Moline, Robert W. Metzler and Arthur J. Dergan against the Metcalfe Construction Company, the Hamilton Construction Company and the Kansas City Bridge Company, joint adventurers in the performance of a Government construction contract, to recover compensation for overtime under the provisions of the Fair Labor Standards Act of 1938, as amended, 29 U.S.C.A. § 207. The parties have entered into a comprehensive stipulation which adequately sets forth the facts material to their dispute. The court accepts this stipulation in its entirety and makes a special finding that the facts are as stipulated. The stipulation will not be set forth in toto at this point, because it would unnecessarily lengthen this memorandum, since part of the stipulation, with the narrowing of issues, has lost its significance, and the other part will be discussed, and inferences drawn therefrom, subsequently, in connection with particular points in issue.

1. Jurisdiction

As a general rule, since the Fair Labor Standards Act is an Act to regulate commerce, the federal courts have jurisdiction of actions arising under it, such as those to recover wages due, irrespective of diversity of citizenship or amount involved. 29 U.S.C.A. § 216(b); 28 U.S.C.(1940 Ed.) § 41(8), 28 U.S.C.A. § 1337; 2 Cyclopedia of Federal Procedure (1951 Ed.) Sec. 2.368, p. 42, n. 4. However, defendants contend that Section 2 of the Portal to Portal Act, 29 U.S.C.A. § 252(d), deprives the court of jurisdiction because plaintiffs have failed to plead and prove that the activities for which they seek compensation were compensable by contract, custom or practice. This contention must be rejected. Where the activities for which compensation is sought are, as in this case, part of the employees' principal activity, and not "portal to portal" in character, Section 2 of the Portal Act does not apply. Central Missouri Telephone Co. v. Conwell, 8 Cir., 1948, 170 F.2d 641; Biggs v. Joshua Hendy Corp., 9 Cir., 1950, 183 F.2d 515; Culkin v. Glenn L. Martin Nebraska Co., D.C.Neb. 1951, 97 F.Supp. 661. Consequently, plaintiffs' failure to plead and prove a contract, custom or practice, by which the activities involved in this case were compensable, does not prevent the court from taking jurisdiction of the case, nor does it, ipso facto, bar plaintiffs' claim.

2. Coverage

The provisions of the Fair Labor Standards Act are applicable to all non-exempt employees engaged in commerce or in the production of goods for commerce. 29 U.S.C.A. §§ 206 and 207. In determining whether an individual employee is within the coverage of the wage-hour law the relationship of the employer's business to commerce may be an important indication of the employee's work. Borden Co. v. Borella, 325 U.S. 679, 65 S.Ct. 1223, 89 L. Ed. 1865; 10 E. 40th St. Bldg. v. Callus, 325 U.S. 578, 65 S.Ct. 1227, 89 L.Ed. 1806. The following discussion of the work of the defendant companies is, therefore, appropriate.

Shortly after the outbreak of World War II, the War Department and the Corps of Engineers entered into contracts with various contractors, other than the defendants, for construction of the road commonly and popularly known as the Alcan Highway, which ran from Edmonton, Alberta, Canada, a distance of 2,132 miles, to Fairbanks, Alaska. In order for the Army to operate and make use of this road, it was necessary that installations and buildings be constructed for living quarters of troops, warehousing, etc.; in order for the air forces to make use of this route, airports and emergency flight strips had to be constructed. Defendants, under contract with the Government, constructed these ancillary installations to the Alcan Highway. The defendants were engaged in the original construction of the buildings, flight strips, etc., and as soon as the installations were completed, they were turned over to the representative of the Corps of Engineers, and thereafter were maintained by the United States Army. At no time did the defendant companies perform any work on the Alcan Highway itself, either on the original construction or maintenance; and at no time did the defendants operate any of the above-mentioned base installations or other works.

Defendants contend that an employee of a construction company is only "engaged in commerce" if his employment involves repair, improvement or reconstruction of existing instrumentalities of commerce, but not if the construction relates to the erection of entirely new facilities. Reed v. Murphey, 5 Cir., 1948, 168 F.2d 257, affirmed on this point in Murphey v. Reed, 335 U.S. 865, 69 S.Ct. 105, 93 L. Ed. 410; Maitrejean v. Metcalfe Construction Co., 8 Cir., 1948, 165 F.2d 571; Kam Koon Wan v. E. E. Black, Limited, 9 Cir., 1951, 188 F.2d 558; McDaniel v. Brown & Root, Inc., 10 Cir., 1949, 172 F.2d 466; Annotation 8 A.L.R.2d 738. These cases persuade the court that plaintiffs were not "engaged in commerce" within the meaning of the Fair Labor Standards Act, 29 U.S. C.A. § 201 et seq. It is true that coverage of the Act depends upon the character of the employees' activities and not upon the nature of the employer's business. Overstreet v. North Shore Corp., 318 U.S. 125, 63 S.Ct. 494, 87 L.Ed 656; Kirschbaum v. Walling, 316 U.S. 517, 62 S.Ct. 1116, 86 L. Ed. 1638; Warren Bradshaw Drilling Co. v. Hall, 317 U.S. 88, 63 S.Ct. 125, 87 L.Ed. 83. However, the evidence does not establish that the plaintiffs' activities were an essential part of the stream of commerce. Plaintiff Cyril J. Byrne was a Commissary Helper, plaintiff James W. Tilley was a Camp Steward and later a Chief Camp Steward, plaintiff Fritz L. Moline was a Field Clerk and later a Second Cook, plaintiff Robert S. Metzler was a Canteen Manager and later a Camp Steward, and plaintiff Arthur J. Dergan was a Field Clerk. There is nothing to substantiate a claim that the activities of these employees were actually in or so closely related to the movement of commerce as to be a part of it. See McLeod v. Threlkeld, 319 U.S. 491, 63 S.Ct. 1248, 87 L.Ed. 1538.

The plaintiffs were not engaged "in the production of goods for commerce" because the installations, buildings and airstrips were not "goods" within the meaning of the Act. 29 U.S.C.A. § 203(i); Noonan v. Frusco Construction Company, 8 Cir., 1943, 140 F.2d 633; Engebretsen v. E. J. Albrecht Co., 7 Cir., 1945, 150 F.2d 602; Kenney v. Wigton Abbott Corporation, D. C.N.J., 1948, 80 F.Supp. 489; 29 C.F.R. (1949 Ed.) Cum.Poc.Supp. Sec. 776.20(b), n. 38.

One final fact should be mentioned with respect to the inapplicability of the provisions of the Fair Labor Standards Act to the plaintiffs in this case. All the work performed by all of the plaintiffs was within the territorial limits of the Dominion of Canada, with the exception of the work performed by the plaintiff Tilley during the period beginning May 21, 1943,...