Idaho Mutual Benefit Association, Inc. v. Robison

Decision Date15 December 1944
Docket Number7166
PartiesIDAHO MUTUAL BENEFIT ASSOCIATION, INC., Appellant, v. W. L. ROBISON, G. W. SUPPIGER and B. W. OPPENHEIM, constituting and being the Industrial Accident Board of the State of Idaho, Respondents
CourtIdaho Supreme Court

1. Action

Under declaratory judgment law, the district court has jurisdiction to entertain suit to construe unemployment compensation statute, notwithstanding power conferred upon Industrial Accident Board to determine its jurisdiction and attendant questions antecedent to enforcing unemployment compensation law. (Sess. Laws 1933, chap. 70, secs. 1, 2, 12; Sess. Laws 1935, 3d Ex. Sess., chap. 12, as amended.)

2. Constitutional law

A constitutional amendment, although initiated by the Legislature, becomes effective when ratified by the people and not otherwise. (Const., art. 5, sec. 9, amended 1936.)

3. Statutes

In passing a statute, the Legislature is presumed to have in mind the law that exists at the time the statute is enacted.

4. Constitutional law

The general rules of statutory construction apply to the amendment of a Constitution.

5. Constitutional law

The state of the law at the time the people vote upon a proposed constitutional amendment is that which is controlling and must be considered as that which the people had in mind at time of voting upon amendment.

6. Unemployment compensation

Taxation

Workmen's compensation

Constitutional amendment authorizing direct appeals from orders of the Industrial Accident Board to the Supreme Court was intended by the people to be sufficient to encompass appeals in both industrial accident cases and unemployment compensation matters. (Sess. Laws 1935, 3d Ex. Sess., chap. 12, as amended; Const., art. 5, sec. 9, amended 1936.)

7. Constitutional law

Constitutional provisions must be read in the light of the law existing at the time of the adoption of the provisions.

8. Unemployment compensation

Taxation

The Supreme Court is as much bound by the finding of fact made by the Industrial Accident Board in unemployment compensation cases as in industrial accident cases. (Sess. Laws 1935, 3d Ex. Sess., chap. 12, as amended; Const., art. 5, sec. 9 amended 1936.)

9. Constitutional law

In placing administration of unemployment compensation law in Industrial Accident Board, no jurisdiction was taken from the courts, since unemployment compensation law is a statutory proceeding and right and did not exist at common law. (Sess Laws 1935, 3d Ex. Sess., chap. 12, as amended.)

10. Unemployment compensation

Constitutional law

Taxation

Unemployment compensation provision giving Industrial Accident Board administrative and status determining power is not unconstitutional as a violation of "due process" in depriving a person of right to have his cause heard before an impartial tribunal, since the board is not an adversary. (Sess. Laws 1935, 3d Ex. Sess., chap. 12, as amended.)

11. Action

Although district court had jurisdiction to construe unemployment compensation act and pass upon its constitutionality, it had no jurisdiction to determine whether insurance company or its agents were within scope of the act, since such questions were to be determined by Industrial Accident Board in the first instance, which determination was reviewable on appeal. (Sess. Laws 1935, 3d Ex. Sess., chap. 12, as amended; Sess Laws 1933, chap. 70, secs. 1, 2, 12; Const., art. 5, sec. 9 amended 1936.)

12. Constitutional law

Where no penalties had yet been imposed, the question whether such excessive penalties are authorized under the unemployment compensation statute as to render it unconstitutional is not properly before the Supreme Court. (Sess. Laws 1935, 3d Ex. Sess., chap. 12, as amended.)

13. Constitutional law

In connection with hearings before administrative boards, unless an appeal is provided therefrom to a court, even though the scope of review be limited, "due process" is not satisfied.

14. Unemployment compensation

Constitutional law

Taxation

Unemployment compensation provision requiring that any person appealing shall submit to the jurisdiction of Industrial Accident Board is unconstitutional as deprivation of "due process" by taking away right of appeal to a court. (Sess. Laws 1941, chap. 182, sec. 7-5(a), p. 409.)

15. Statutes

Unconstitutionality of unemployment compensation provision requiring that any person appealing shall submit to the jurisdiction of Industrial Accident Board does not affect remainder of the act. (Sess. Laws 1941, chap 182, sec. 7-5(a), p. 409.)

Appeal from the District Court of the Third Judicial District, for Ada County. Hon. Charles F. Koelsch, Judge.

Reversed in part and affirmed in part.

Z. Reed Millar for appellant.

The Court by law had jurisdiction of the case to inquire into and determine the factual question of "covered employment." (Sec. 7, chap. 239, 1939 Sess. Laws; Inland Empire Rural Elect. Inc. v. Dept. Pub. Ser., (Wash.) 92 P.2d 258; Union Pac. R. R. v. Bean, (Ore.) 119 P.2d 575; Dept. of Treas. of Ind. v. J. P. Michael Co., (Ind.) 11 N.E.2d 512; McCabe v. City of New York, 10 N. Y. S. (2d) 383; Gully, Tax Collector v. Interstate Nat. as. Co., 82 F.2d 145; Daniel, Attorney Gen. v. Constee Mills, (S. C.) 191 S.E. 76; Borchard, Declaratory Judgments, pp. 250 and 342.)

Sec. 18-5 of the Unemployment Compensation Law as amended in 1939-1941, and the first amendment in 1943 is unconstitutional and void as prohibiting a person the right of acquiring a status of Independent Contractor and not due process of law. (Sec. 1, Art. I, Idaho Constitution; Mays v. District Court, 34 Ida. 200, 200 P. 115.)

The Unemployment Compensation Act is unconstitutional and void in depriving the Judicial Department of jurisdiction which rightly belongs to it, both in depriving the District Courts of jurisdiction, and providing for direct appeal to the Supreme Court. (Sec. 20, Art. 5, Idaho Const.; Sec. 13, Art. 5, Idaho Const.; Batt v. Unemployment Compensation Div., (Ida.) 123 P.2d 1004; Smythe v. Phoenix, (Ida.) 123 P.2d 1010; Big Wood Canal Co. v. Unemployment Comp. Div., 61 Ida. 247, 100 P.2d 49; McBee v. Brady, 15 Ida. 741, 100 P. 97.)

Sec. 7-5 of the Unemployment Compensation Law as amended by Sec. 6 of Chap. 182, of the 1941 Session Laws, providing for determination of the question of "covered employment" by a representative of the Board, without an opportunity for the employer to be heard is unconstitutional and void, as not providing due process of law. (Art. 1, Sec. 13, Idaho Const.; Kelly v. Prouty, 52 Ida. 743, 19 P.2d 1061; Abrams v. Jones, 35 Ida. 532; Mays v. District Court, 34 Ida. 200, p. 115; Johnson v. Diefendorf, 56 Ida. 670, 57 P.2d 1068; Western Loan & Bldg. Co. v. Bandel, 57 Ida. 101, 63 P.2d 159.)

Bert H. Miller, Attorney General, and Thomas Y. Gwilliam, Assistant Attorney General, for respondents.

Jurisdiction to determine "coverage" is vested in the Industrial Accident Board. (Sec. 7-5, Chap. 182 of the 1941 Sess. Laws; Sec. 43-1404, I. C. A.; Sec. 9, Araivle V, Const. of Idaho as amended; Sec. 43-1409, I. C. A., as amended by Chap. 175 of the 1937 Law.)

Industrial Accident Board is an administrative body under the Executive Branch of the government and its rules and regulations are not an invasion of the Judicial Branch of the government. ( Cook v. Massey, 38 Ida. 264, 220 P. 1088, 35 A. L. R. 200; In re Bones, 48 Ida. 85, 280 P. 223; 71 C. J. 917, Sec. 655; Brary v. Place, 41 Ida. 747, 242 P. 314.)

Since the statute gives an administrative remedy by appeal to the Industrial Accident Board, such remedy must be exhausted before resort can be had to courts. (48 Yale Law Journal, 981, and Cases therein cited; Prudential Ins. Co., of America v. Powell, 8 N.E.2d 619; Louis Eckert Brewing Co., et al, v. Unemployment Reserves Com., (Cal.) 119 P.2d 227; Abelleira v. District Court of Appeals, (Cal.) 109 P.2d 942.)

Givens, J. Holden, C. J., and Ailshie, J., concur. Budge, J., dissenting. Justice Dunlap concurs in the dissenting opinion.

OPINION

Givens, J.

The Industrial Accident Board had apparently indicated it would require appellant to pay unemployment compensation premiums on certain of its agents. Appellant, not being acquiescent, instituted the present suit under the declaratory judgment law asking the court to construe the unemployment compensation statute (Chap. 12, Third Extraordinary Session of 1935, as amended by Chapters 9, 183, 187, and 188 of the 1937 Sess. Laws; Chaps. 202, 203, and 239, 1939 Sess. Laws; Chaps. 65, 175, and 182, 1941 Sess. Laws; Chaps. 29, 68, 92, 1943 Sess. Laws) and attacking the same. A demurrer was interposed and sustained, hence the appeal, in which appellant makes these principal contentions: that the law is unconstitutional because it constitutes the board both investigator and trier of the facts without, in the first instance, a hearing where the employer is present before the examiner; that a direct appeal does not lie from orders of the Industrial Accident Board covering questions under the unemployment compensation law; that the penalties provided by the act are so severe as to render the statute unconstitutional; that the agents are not employees within the scope of the statute; that plaintiff is not engaged in any business or profession within the unemployment compensation law. Other questions were raised which by reason of the disposition of this case need not be considered herein.

Respondent took the position the court did not have jurisdiction under the declaratory judgment statute to entertain the controversy but entire jurisdiction was wholly in the Industrial Accident Board.

The declaratory judgment statute [1] is broad and comprehensive. Conceding the Industrial Accident...

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