Pierce v. Foley Bros., Inc.

• Decision Date: 16 May 1969
• Docket Number: No. 41165,41165
• Parties: Orie PIERCE, Respondent, v. FOLEY BROS., INC., Appellant.
• Court: Minnesota Supreme Court

Page 346

168 N.W.2d 346

283 Minn. 360

Orie PIERCE, Respondent, v. FOLEY BROS., INC., Appellant.

No. 41165.

Supreme Court of Minnesota.

May 16, 1969.

Syllabus by the Court

1. When an appeal is allowed from an otherwise nonappealable order through certification of a question as important and doubtful pursuant to Minn. St. 605.09(i) and Rule 103.03(i), Rules of Civil Appellate Procedure, review by this court is limited to that certified question. To hold otherwise would be to defeat the purpose of certification.

2. The assumption of jurisdiction by, and the award of, the State of Oklahoma did not infringe the due process and full faith and credit clauses of the Federal Constitution. Where the contract is entered into within the state, even though it is to be performed elsewhere, its terms, its obligations, and its sanctions are subject in some measure to the legislative control of the state. The fact that the contract is to be performed elsewhere does not itself put these incidents beyond reach of the power which a state may constitutionally exercise. The power of a state to effect legal consequences is not limited to occurrences within the state if it has control over the status which gives rise to those consequences.

3. Under the 'center of gravity' or the 'legitimate interest' rule, established in Alaska Packers Assn. v. Industrial Acc. Comm., 294 U.S. 532, 55 S.Ct. 518, 79 L.Ed. 1044, it is only reasonable to assume that Oklahoma had a legitimate public interest in controlling and regulating the employer-employee relationship in the case at bar in such fashion as to impose liability upon the employer for an injury suffered by the employee and in providing a remedy available to him in Oklahoma. Thus, in the special circumstances disclosed, the State of Oklahoma had as great an interest in affording adequate protection to this class of its population as it had to employees injured within the state. Therefore, indulging the presumption of constitutionality which attaches to every state statute, we cannot say that this one, as applied, lacks a rational basis or involved any arbitrary or unreasonable exercise of state power.

4. The only issue of consequence in the case at bar is whether, at the time of plaintiff's injuries in Montana, he was working pursuant to an employment contract made in Oklahoma. We adopt the rule, recently adopted by the California court upon similar facts, that an oral contract consummated over the telephone is deemed made where the offeree utters the words of acceptance.

Maun, Hazel, Green, Hayes, Simon & Aretz, and Albert A. Woodward, St. Paul, for appellant.

Stacker, Silverstein, Burke & Radsom, and R. William Reilly, St. Paul, for respondent.

OPINION

NELSON, Justice.

Appeal from an order of the District Court of Ramsey County dated September 12, 1967, as amended October 9, 1967, denying the motion of defendant-appellant for summary judgment and certifying a particular question as important and doubtful pursuant to Minn. St. 605.09(i).

About June 28, 1962, and for some time prior to that date, defendant, Foley Bros., Inc., engaged in the general pipeline business in the State of Montana in a partnership or joint venture with the Shamrock Construction Company under the business name of Foley-Shamrock Construction Company, maintaining offices in that state. In connection with the performance of various construction contracts in Montana, Foley-Shamrock hired as an employee plaintiff, Orie Pierce, allegedly at his home in Hayworth, Oklahoma. Plaintiff entered into his duties pursuant to an employment contract resulting from said hiring. Plaintiff suffered accidental personal injuries on May 28 and June 27, 1962, arising out of and in the course of his employment in Montana.

Plaintiff returned to Oklahoma where he sought workmen's compensation. On September 4, 1963, he recovered an award against Foley-Shamrock in the State Industrial Court of Oklahoma. No part of the award has been paid, and it was reduced to judgment on September 15, 1965.

Plaintiff brought this action to enforce the judgment, which was entered for $19,824.69; to recover $304.54, representing an amount which defendant was ordered to pay to the Special Indemnity Fund of the State Industrial Court of Oklahoma, said amounts totaling $20,129.23; and to recover his costs and disbursements.

Defendant denies plaintiff's claim, admitting only that on or about the dates alleged it was engaged, in conjunction with the Shamrock Construction Company as a joint venture partnership, in the performance of a construction contract in the State of Montana and that said partnership maintained offices in Montana, and specifically denying that the partnership or defendant maintained any offices or business location in the State of Oklahoma and that plaintiff was hired at offices maintained by defendant in Oklahoma.

Defendant alleges that plaintiff was hired in the State of Montana under a Montana contract of hire and that all duties of plaintiff's employment were performed in Montana and not otherwise. Defendant further alleges that the purported workmen's compensation award by the State Industrial Court of Oklahoma was wholly invalid, void, and of no force or effect For lack of jurisdiction by the State Industrial Court over the subject matter of the claim and the person of the named defendant. In general, defendant denies plaintiff's right to recover on the Oklahoma judgment.

The record before us on this appeal contains testimony taken before Judge J. Clark Russell of the State Industrial Court on June 12, 1963, the witnesses being plaintiff and his son, Charlie H. Pierce, who was employed by Foley-Shamrock Construction Company and through whom the hiring of plaintiff took place. There was no cross-examination since defendant chose not to attend, even though it had notice of the hearing.

After filing its answer to the complaint herein, defendant moved the Ramsey County District Court pursuant to Rule 56, Rules of Civil Procedure, for summary judgment on the ground that all the files, records, and proceedings, together with affidavits and the record from the State Industrial Court of Oklahoma, tended to establish that there was no genuine issue as to any material fact and therefore, as a matter of law, defendant was entitled to judgment. That motion was denied and the issues to be litigated were narrowed and set forth in an order and memorandum by the Honorable Leonard J. Keyes dated September 12, 1967. In support of the order denying the motion, the memorandum sets forth certain material facts over which Judge Keyes felt genuine issues exist. Among those facts are (1) whether the telephone conversation with plaintiff in Oklahoma resulted in an employment contract in Oklahoma; (2) whether Charlie H. Pierce had authority to enter into such a contract; (3) whether such a contract, if found to exist, was sufficient contract with Oklahoma to create in personam jurisdiction over defendant in that state; (4) whether proper notice of the Oklahoma hearing was given to defendant; and (5) whether there was a deficiency of evidence at that hearing.

In the memorandum Judge Keyes stated:

'Plaintiff claims that, since Oklahoma had jurisdiction Ab initio over Defendant, the judgment is, as a matter of law, entitled to full faith and credit in Minnesota. Defendant, on the contrary, claims it is void as a matter of law. If no genuine issues as to material fact were present, summary judgment would necessarily be awarded. However, I believe genuine issue does arise as to certain material facts; hence, the sought relief must be denied at the Rule 56 stage.

'Plaintiff's substantive data assert that he entered into a contract of employment in Oklahoma with Defendant, through its actually or apparently authorized agent, Charles H. Pierce; and that subsequently and pursuant to this contract, Plaintiff went to Montana and commenced performance.

'Defendant denies that a contract of employment was effected in Oklahoma but asserts that its factual data lead to the conclusions that Charles H. Pierce had no authority, actual nor apparent, to hire Plaintiff in Oklahoma and that, in fact, Plaintiff was hired in Montana.

'Defendant claims, however, that even if Plaintiff entered into a contract of employment with it in Oklahoma, such did not constitute the minimal contract required to create an In personam submission to Oklahoma for problems arising out of such contract. Defendant concedes that summary judgment is unavailable if its position is found untenable, since genuine factual issues become material.'

The trial court, after review of the authorities, further said:

'* * * I am of the opinion that Plaintiff's Oklahoma judgment is entitled to full faith and credit in Minnesota if he can satisfy the fact trier that he and Defendant entered into an employment contract in the State of Oklahoma. Such establishment would require proof of facts sufficient to show authority in Charles H. Pierce, contract consummation in Oklahoma, and or subsequent ratification in Montana. Presently, however, these facts are genuinely disputed and cannot be resolved at this procedural stage.

'I fail to see how a defaulting party can complain of evidentiary deficiencies occurring at a default hearing. Cross-examination opportunity was waived for what appeared to be a more appropriate avenue, another calculated risk which a non-resident must assume when he decides to stay out of a forum on a jurisdictional basis.

'The most significant ruling is that Defendant's contact in Oklahoma may have been sufficient to render Defendant personally amenable to Oklahoma jurisdiction in a matter arising from such contact. The other contentions of Defendant, I feel, constituted collateral--rather than direct--attacks on the foreign judgment.

'Hence, the trial of this matter should be limited to the ascertainment of whether or not a contract of employment was entered into between Plain...