Matheny v. Edwards Ice Machine & Supply Co.

• Decision Date: 10 March 1930
• Docket Number: No. 6004.,6004.
• Parties: MATHENY v. EDWARDS ICE MACHINE & SUPPLY CO.
• Court: U.S. Court of Appeals — Ninth Circuit

39 F.2d 70 (1930)

MATHENY v. EDWARDS ICE MACHINE & SUPPLY CO.^*

No. 6004.

Circuit Court of Appeals, Ninth Circuit.

March 10, 1930.

Allison Moulton, of Medford, Or., and Lord & Moulton, of Portland, Or., for appellant.

Maurice W. Seitz, and Senn & Recken, all of Portland, Or., for appellee.

Before RUDKIN, DIETRICH, and WILBUR, Circuit Judges.

DIETRICH, Circuit Judge.

On May 8, 1929, the Medford Ice & Storage Company was constructing an addition to its refrigerating and cold storage plant at Medford, Or., and under contract the appellee, Edwards Ice Machine & Supply Company, was installing refrigeration pipes therein. Hereinafter these two companies will be referred to, respectively, as the storage company and the supply company. While, as an employee of the storage company, appellant was engaged in wheeling concrete in the plant, he was struck by a piece of steel which employees of the supply company permitted to fall from a point above, where they were at work installing pipes. Alleging negligence on their part, appellant brought this action against the supply company to recover damages for his injury. Pursuant to a peremptory instruction, the jury returned a verdict for the defendant. The controlling issue at the trial centered about the interpretation of the Oregon Workmen's Compensation Act (Or. L. § 6605 et seq.), and that is the sole question submitted here. In other words, it is conceded that if, as was held in the court below, plaintiff was bound to accept the benefits of that act and was debarred by its provisions from bringing an action at law, the instruction was right; otherwise it was error, and the judgment should be reversed. It may be added that on July 10, 1929, and before this suit was commenced, the appellant filed with the State Industrial Accident Commission, which is the body authorized by law to make awards, his claim in due form for compensation under the Compensation Act and together therewith a notice to the commission that he elected "to seek remedy against a third party," namely, the supply company, but up to the present time no action has been taken thereon by the commission.

The Compensation Act is applicable to all "hazardous occupations," and, under the statutory definition of these terms, undoubtedly both the corporations were engaged in a hazardous occupation at the time the accident occurred. It is provided in the act that, by following certain prescribed procedure, both employers and workmen may in advance elect not to come within its terms or to share in its benefits and burdens; without such election manifested in the statutory manner, the act becomes automatically applicable to all who engage in hazardous occupations, whether as employers or employees. There is affirmative evidence that the storage company, and none that the supply company, was operating under its terms; but, in the absence of an affirmative showing of an election not to be bound thereby, we think it must be presumed that the latter also was so operating. And such is the theory upon which the cause was tried.

The language of the act directly involved is found in section 6616 of the Oregon Laws 1920. This section provides that every workman subject to the act, in the employ of an employer subject thereto, who, while so employed, sustains a personal injury by an accident arising out of and in the course of his employment, is entitled to receive from the "industrial accident fund," to which all employers contribute, the sum or sums thereinafter specified; "and the right to receive such sum or sums shall be in lieu of all claims against his employer on account of such injury * * * except as hereinafter specially provided; provided, however, that if the injury to a workman occurring away from the plant of his employer is due to the negligence or wrong of another not in the same employ, the injured workman, * * * shall elect whether to take under this act or seek a remedy against such other, such election to be in advance of any suit, and if he take under this act the cause of action against such other shall be assigned to the state for the benefit of the accident fund. If the other choice is made the accident fund shall contribute only the deficiency, if any, between the amount of recovery against such third person actually collected and the compensation provided or estimated by this act for such case." There follow certain provisions relating to the respective rights of the injured workman and of the commission in case one election or the other is made, which are not presently material.

Plaintiff's reasoning is that, inasmuch as he was employed only by the storage company and was injured in its plant, the proviso has no application, and the clause immediately preceding, declaring that his right to receive compensation is in lieu of claims he might otherwise assert "against his employer," does not operate to cut off or prejudice the right of action he would otherwise have against a third party. And in that view it follows that, in whatever order he may elect to proceed, he may assert the right twice to receive full compensation, once from the accident fund and once from the defendant, and this notwithstanding the fact that in part the burden of creating and maintaining that fund falls upon the defendant. Standing alone and read strictly, the clause declaring that the right to receive compensation "shall be in lieu of all claims against his employer" would by implication afford strong support to plaintiff's position. But if that view be taken the exception in the nature of a proviso immediately following becomes...