Haney v. North Dakota Workers Compensation Bureau

• Decision Date: 15 June 1994
• Docket Number: No. 930324,930324
• Citation: 518 N.W.2d 195
• Parties: Robert C. HANEY, Appellant, v. NORTH DAKOTA WORKERS COMPENSATION BUREAU, Appellee. Civ.
• Court: North Dakota Supreme Court

Page 195

518 N.W.2d 195

Robert C. HANEY, Appellant, v. NORTH DAKOTA WORKERS COMPENSATION BUREAU, Appellee.

Civ. No. 930324.

Supreme Court of North Dakota.

June 15, 1994.

Mark G. Schneider, of Schneider, Schneider & Schneider, Fargo, for appellant.

Ken R. Sorenson, Asst. Atty. Gen., North Dakota Workers Compensation Bureau, Bismarck, for appellee.

SANDSTROM, Justice.

In this case we address the constitutionality of the agricultural exemption from workers compensation coverage. A farm worker appeals from a district court judgment affirming a North Dakota Workers Compensation Bureau order denying benefits. We conclude the agricultural exemption in the workers compensation law does not violate the equal protection guarantee of the North Dakota Constitution and affirm.

I

Robert C. Haney, a farm laborer, injured his back while cleaning grain storage facilities for Grindberg Farms. Haney applied for workers compensation benefits. The bureau initially concluded it did not have jurisdiction and dismissed Haney's claim. After a formal hearing held at Haney's request, the bureau found Haney injured his back while performing agricultural-related activities for his employer, Grindberg Farms. The bureau concluded N.D.C.C. Sec. 65-01-02(21)(a) [now Sec. 65-01-02(22)(a) ] "exempts agricultural employees from hazardous employment within the meaning of the North Dakota Workers Compensation Act"; Grindberg Farms did not have workers compensation coverage for agricultural employees; and the bureau "lacks jurisdiction over this matter and therefore the claimant is not entitled to the receipt of workers compensation benefits." The district court affirmed the bureau's denial of benefits. Haney appeals the bureau's decision.

II

Section 65-01-01, N.D.C.C., sets forth the legislative purpose behind North Dakota's Workers' Compensation program:

"65-01-01. Purposes of compensation law--Police power. The state of North Dakota, exercising its police and sovereign powers, declares that the prosperity of the state depends in a large measure upon the well-being of its wage workers, and, hence, for workers injured in hazardous employments, and for their families and dependents, sure and certain relief 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 title, and to that end, all civil actions and civil claims for relief for such personal injuries and all jurisdiction of the courts of the state over such causes are abolished except as is otherwise provided in this title."

N.D.C.C. Sec. 65-01-02(22)(a) defines "hazardous employment" as "[A]ny employment in which one or more employees are employed regularly in the same business or in or about the establishment except:

" 'a. Agricultural or domestic service.' "

Haney contends the agricultural exclusion in N.D.C.C. Sec. 65-01-02(22)(a) violates the equal protection guarantee afforded him by Art. I, Sec. 21, N.D. Constitution, which provides:

"No special privileges or immunities shall ever be granted which may not be altered, revoked or repealed by the legislative assembly; nor shall any citizen or class of citizens be granted privileges or immunities which upon the same terms shall not be granted to all citizens."

Haney relies on Benson v. North Dakota Workmen's Compensation Bureau, 283 N.W.2d 96 (N.D.1979). In Benson, a majority of three concluded the agricultural exclusion violated the equal protection guarantee of Art. I, Sec. 20 [now 21] N.D. Const. The agricultural exclusion was not nullified by the ruling in Benson because an insufficient number of justices concurred in the result. Section 88, N.D. Const. [now Art. VI, Sec. 4, N.D. Const.], requires the concurrence of four justices of this Court to declare a statute unconstitutional. Benson at 108. See also Bismarck Public School District # 1 v. State, 511 N.W.2d 247, 250 (N.D.1994).

III

A

"[A]n Act of the legislature is presumed to be correct and valid, and any doubt as to its constitutionality must, where possible, be resolved in favor of its validity." Southern Valley Grain Dealers Ass'n v. Board of County Comm'rs, 257 N.W.2d 425, 434 (N.D.1977). "A statute enjoys a conclusive presumption of constitutionality unless it is clearly shown that it contravenes the state or federal constitution." Richter v. Jones, 378 N.W.2d 209, 211 (N.D.1985). " 'The justice, wisdom, necessity, utility and expediency of legislation are questions for legislative, and not for judicial determination.' " Manikowske v. North Dakota Workmen's Compensation Bureau, 338 N.W.2d 823, 825 (N.D.1983), quoting Asbury Hospital v. Cass County, 72 N.D. 359, 7 N.W.2d 438, 442 Syllabus p 11 (1943).

Article I, Sec. 21, N.D. Const., has long been "viewed as our state constitutional guarantee of equal protection under the law." Matter of Adoption of K.A.S., 499 N.W.2d 558, 563 (N.D.1993). Under Art. I, Sec. 21, N.D. Const., not all legislative classifications are unlawful. We review the lawfulness of legislative classifications under three separate standards of review. "The standard used in a particular case depends upon the challenged statutory classification and the right allegedly infringed." Kadrmas v. Dickinson Public Schools, 402 N.W.2d 897, 902 (N.D.1987), aff'd 487 U.S. 450, 108 S.Ct. 2481, 101 L.Ed.2d 399 (1988).

In Gange v. Clerk of Burleigh County District Court, 429 N.W.2d 429, 433 (N.D.1988), this Court outlined the standards of judicial scrutiny for equal protection claims under our state constitution:

"We apply strict scrutiny to an inherently suspect classification or infringement of a fundamental right and strike down the challenged statutory classification 'unless it is shown that the statute promotes a compelling governmental interest and that the distinctions drawn by the law are necessary to further its purpose.' State ex rel. Olson v. Maxwell, 259 N.W.2d 621, 627 (N.D.1977). When an 'important substantive right' is involved, we apply an intermediate standard of review which requires a ' "close correspondence between statutory classification and legislative goals." ' Hanson v. Williams County, 389 N.W.2d 319, 323, 325 (N.D.1986) [quoting Arneson v. Olson, 270 N.W.2d 125, 133 (N.D.1978) ]. When no suspect class, fundamental right, or important substantive right is involved, we apply a rational basis standard and sustain the legislative classification unless it is patently arbitrary and bears no rational relationship to a legitimate governmental purpose. See State v. Knoefler, 279 N.W.2d 658, 662 (N.D.1979)."

Because no inherently suspect or fundamental interest classifications warranting strict scrutiny are involved in this case, we must choose between the rational basis standard and the intermediate standard. There is no bright line test for choosing one test over the other. Hanson v. Williams County, 389 N.W.2d 319 (N.D.1986).

B

This Court has generally applied the intermediate level of scrutiny to classifications which have completely prevented a class of injured persons from maintaining a Court action to recover for their injuries. Kavadas v. Lorenzen, 448 N.W.2d 219, 222-223 (N.D.1989). The rational basis test is usually applied to statutory classifications which involve economic or social matters and do not deprive a class of plaintiffs from access to the courts. Kavadas.

In Benson, 283 N.W.2d at 99, a majority of this Court concluded the agricultural exclusion affected an important substantive right and adopted the intermediate or close correspondence level of review:

"Although we are not concerned in this case with a limitation on actions for common-law tort remedies, we are concerned with the complete exclusion of a legislatively created remedy for personal injury to one class of employees. Our concern here closely resembles those concerns addressed in cases using the intermediate close-correspondence test (Herman v. Magnuson, [277 N.W.2d 445 (N.D.1979) ]; Arneson v. Olson, [270 N.W.2d 125 (N.D.1978) ]; Johnson v. Hassett, [217 N.W.2d 771 (N.D.1974) ], rather than those cases in which we have applied the traditional rational-basis test. Tharaldson v. Unsatisfied Judgment Fund, [225 N.W.2d 39 (N.D.1974) ]. The complete exclusion of agricultural employees from workmen's compensation not only deprives the farm worker of a convenient remedy, it also limits his remedy to a common-law tort action in which the farm worker must prove all elements of a tort before he can recover. Employees covered by workmen's compensation in other similar occupations do not have to make this showing.

"To determine whether the exclusion of agricultural employees from workmen's compensation violates equal protection considerations in this case, there must be a close correspondence between the statutory exclusion and the legislative goals to be accomplished by that exclusion."

The Benson majority examined the stated legislative goal of Workers Compensation, to provide sure and certain relief for workers injured in hazardous employment, and concluded "[t]he exclusion of agricultural employees from the benefits of the Workmen's Compensation Act is unreasonable and contrary to the expressed purpose of the Act." Benson at 107. The Benson majority recognized only the stated legislative goal of providing sure and certain relief and ignored any other goals the legislature may have had. The Court said the agricultural exclusion was designed to benefit only employers and not employees:

"The North Dakota Legislature explicitly expressed the purpose of the Act but the exclusion of agricultural services has no correspondence to that expressed purpose. The legislature made no attempt to express any purpose for the exclusion.

* * * * * *

"The record in this case contains a considerable amount of material relating to the subject of the agricultural exclusion and, together with numerous writings (see e.g., 1B Larson, Workmen's Compensation Law, Farm...