Pillsbury v. ALASKA PACKERS ASS'N., 7853.

• Decision Date: 21 September 1936
• Docket Number: No. 7853.,7853.
• Citation: 85 F.2d 758
• Parties: PILLSBURY, Deputy Com'r, v. ALASKA PACKERS ASS'N. WEIDEMANN v. SAME.
• Court: U.S. Court of Appeals — Ninth Circuit

85 F.2d 758 (1936)

PILLSBURY, Deputy Com'r, v. ALASKA PACKERS ASS'N.

WEIDEMANN v. SAME.

No. 7853.

Circuit Court of Appeals, Ninth Circuit.

September 21, 1936.

H. H. McPike, U. S. Atty., and Robert L. McWilliams, and S. P. Murman, Asst. U. S. Attys., all of San Francisco, Cal., for appellant Pillsbury.

Resleure, Vivell & Pinckney, of San Francisco, Cal., for appellant Weidemann.

F. D. Madison, Eugene M. Prince, and Francis Gill, all of San Francisco, Cal., for appellee.

Before WILBUR, GARRECHT, and HANEY, Circuit Judges.

GARRECHT, Circuit Judge.

On November 15, 1929, the appellant Weidemann fell and injured his right arm and hand while on board the Metha Nelson, a sailing vessel owned and operated by the appellee, and lying in the harbor of Oakland, Cal. Proper notice having been given, pursuant to the provisions of the Longshoremen's and Harbor Workers' Compensation Act (33 U.S.C.A. § 901 et seq.), a hearing was held on January 27, 1930, before the appellant Pillsbury, to ascertain the appellant Weidemann's right to compensation. The appellee was not represented at the hearing, having previously written to the appellant Pillsbury that it desired him to "pass on the responsibility of this particular case."

On February 1, 1930, Pillsbury filed his award, as follows:

(1) That Weidemann was employed by the appellee when injured; (2) that the injury occurred on navigable waters of the United States; (3) that Weidemann suffered temporary total disability, entitling him to $25 a week as compensation, "until further order of the Deputy Commissioner."

The award also ordered the appellee to pay Weidemann $264.28 "to and including January 27, 1930, less all payments heretofore made on said account."

On August 12, 1931, the appellee advised Pillsbury that Weidemann had fully recovered from his injury and requested that further liability under the award be terminated. Weidemann resisted the appellee's request. Accordingly, after proper notice, on August 28, 1931, the matter of terminating the liability was heard before Pillsbury, who, on September 16, 1931, ruled as follows: (1) That Weidemann's right arm became permanently disabled on November 15, 1930, the first anniversary of the accident; (2) that there was $1,025 unpaid accrued compensation due Weidemann from November 15, 1930, to August 28, 1931, which the deputy commissioner ordered the appellee to pay, in addition to $25 a week for 60.64 weeks thereafter, beginning August 28, 1931, the date of the last hearing.

It is admitted that the appellee received a copy of each of the two foregoing orders of the deputy commissioner.

Within 30 days thereafter, the appellee petitioned Pillsbury to set aside his order of September 16, 1931, and for a rehearing, claiming fraud on the part of Weidemann as to the question of employment, and lack of notice in the order of February 1, 1930, of liability for any further compensation, in addition to the first award.

On October 16, 1931, on the ground that the appellee had failed to establish fraud, and on the further ground that the jurisdictional facts adjudicated by the award of February 1, 1930, had established the appellee's liability for the accrued compensation awarded on September 16, 1931, Pillsbury denied the appellee's petition for a rehearing. On the ground that no fraud on Weidemann's part had been shown, the court below sustained a motion for nonsuit in an equity action, No. 3056-L, arising out of the same facts, which was brought by the appellee, but which is not now before this court.

On November 16, 1931, the appellee filed the present action. A trial de novo was held to review the jurisdictional fact of Weidemann's employment by the appellee. Thereafter, the court below entered a decree setting aside Pillsbury's orders of September 16, 1931, and October 16, 1931, enjoining Pillsbury from enforcing the compensation award, and ordering that Weidemann take nothing from the appellee on account of the injury or by reason of any orders theretofore entered by Pillsbury.

While the present action originally was filed as a suit in equity, by stipulation the cause was transferred to the admiralty docket, to be tried simultaneously with No. 3056-L, in equity, supra.

Three assignments of error filed by Pillsbury present a single question; namely, Did the court below have jurisdiction to entertain this action, under section 21 (a) and (b) of the Longshoremen's and Harbor Workers' Compensation Act of 1927?

The appellant Weidemann also asserts as error the lower court's finding as to nonemployment, which was as follows: "Respondent Pillsbury, with the exercise of reasonable care, should have known prior to entry of the compensation order and award of February 1, 1930, that respondent Weidemann was not an employee of libelant appellee, and that the injury alleged by him was not within the purview of the Longshoremen's and Harbor Workers' Compensation Act. * * *"

Section 21 (a) and (b) of the act in question reads in part as follows:

"(a) A compensation order shall become effective when filed in the office of the deputy commissioner as provided in section 19 section 919 of this chapter, and, unless proceedings for the suspension or setting aside of such order are instituted as provided in subdivision (b) of this section, shall become final at the expiration of the thirtieth day thereafter.

"(b) If not in accordance with law, a compensation order may be suspended or set aside, in whole or in part, through injunction proceedings, mandatory or otherwise, brought by any party in interest against the deputy commissioner making the order, and instituted in the Federal district court for the judicial district in which the injury occurred." 44 Stat. pt. 2, 1436 (33 U.S.C.A. § 921 (a, b).

Section 22 (44 Stat. 1437), as it stood at the time the present suit was brought, was as follows: "Upon his own initiative, or upon application of any party in interest, on the ground of a change in conditions, the deputy commissioner may at any time during the term of an award and after the compensation order in respect of such award has become final, review such order in accordance with the procedure prescribed in respect of claims in section 19, and in accordance with such section issue a new compensation order which may terminate, continue, increase, or decrease such compensation. Such new order shall not affect any compensation paid under authority of the prior order."

In the instant case, Pillsbury's first order, of February 1, 1930, awarded Weidemann $25 a week from January 27, 1930, "until further order of the Deputy Commissioner."

Thus, both by the provisions of the statute and the terms of the order itself, the deputy commissioner retained jurisdiction over Weidemann's claim for compensation. But that jurisdiction was limited by section 22 to be exercised only in the event that there was "a change in conditions."

In other words, the supplemental order of September 16, 1931, did not and could not review the jurisdictional question of employment; for, obviously, that question is not susceptible to any "change in conditions." The claimant is either in the employ of the shipowner at the time of the injury, or he is not employed. Nothing that occurs afterward can alter the status that exists at the time of the accident.

The expression "change in conditions" refers to a change in the physical condition of the employee. Atlantic Coast Shipping Co. v. Golubiewski (D.C.) 9 F.Supp. 315, 317.

In its libel, the appellee charges that Weidemann "fraudulently misrepresented" the jurisdictional facts to Pillsbury, and that "a fraud had been perpetrated against" the appellee. The court below, however, expressed itself unequivocally on the subject of fraud: "I don't see anything in his Weidemann's conduct which indicates to me he was trying to deceive or defraud or get something that he was not entitled to. I think he honestly believed and believes now, probably, that he was employed at that time. Consequently, there is no element of fraud that I can see."

Indeed, the testimony of Austin K. Tichenor, vice president and general manager of the appellee, conclusively shows that he did not rely upon Weidemann's statements as to his status, but upon the statements of Roy E. Astrup, superintendent of the appellee's shipyards at Alameda, Cal. In a series of searching questions, the District Judge himself elicited this information from Tichenor:

"Q. In other words, you didn't go out trying to round up evidence? A. No.

"Q. It was more a matter of sympathy? A. I knew both of these men for years.

"Q. But as a matter of fact, even though his statements might be false they didn't affect you in making the representation to your company? A. No, not at that time.

"Q. You relied upon your subordinate, Captain Astrup, did you? A. I did."

In its libel, the appellee averred that it "could not, with reasonable diligence, have discovered" the evidence surrounding the circumstances of Weidemann's injury. In its brief, the appellee stresses the "open spirit of cooperation with the Deputy Commissioner" in which the "appellee was originally misled into consenting to an award of $264.28." It seems strange, however, that an employer would require 23 months to ascertain whether or not a certain individual was in its employ on a given date. Such tardiness strongly suggests lack of due diligence — particularly in view of the fact that Tichenor admits he did not "go out trying to round up evidence."

Another probable reason for the shipowner's inaction after Pillsbury's first order was that the lump-sum award was small. This is clearly indicated in the appellee's brief:

"Upon discovery of facts that appellee was not liable for the injury to Weidemann's hand and wrist, it was the Deputy Commissioner's duty to absolve appellee of further liability.

"Instead, he held that appellee had consented to a finding of employment by not seeking injunctive redress within...