Rix v. Turnbull-Novak, Inc.

• Decision Date: 14 November 1958
• Docket Number: No. 16026.,16026.
• Citation: 260 F.2d 785
• Parties: Irving RIX, Appellant, v. TURNBULL-NOVAK, INC., Appellee.
• Court: U.S. Court of Appeals — Eighth Circuit

260 F.2d 785 (1958)

Irving RIX, Appellant, v. TURNBULL-NOVAK, INC., Appellee.

No. 16026.

United States Court of Appeals Eighth Circuit.

November 14, 1958.

Hershel Shanks, Atty., Dept. of Justice, Washington, D. C. (George Cochran Doub, Asst. Atty. Gen., Edward L. Scheufler, U. S. Atty., Kansas City, Mo., and Samuel D. Slade, Atty., Dept. of Justice, Washington, D. C., were with him on the brief), for appellant.

Whitson Rogers, Kansas City, Mo., for appellee.

Before JOHNSEN, VAN OOSTERHOUT and MATTHES, Circuit Judges.

VAN OOSTERHOUT, Circuit Judge.

Plaintiff, Irving Rix, an honorably discharged veteran, appeals from final judgment dismissing his claim for damages against the defendant for alleged violation of reemployment rights as provided by section 9 of the Selective Service Act of 1948, as amended, 62 Stat. 604, 614, 50 U.S.C.A.Appendix § 459, hereinafter called the Act.

The complaint alleged that the defendant, Turnbull-Novak, Inc., was the successor in interest of J. Gordon Turnbull, Inc., the veteran's pre-induction employer. The trial court had in a previous order sustained defendant's motion for summary judgment upon the ground that a stipulation, answers to request for admissions and answers to interrogatories showed conclusively that defendant was not a successor in interest to plaintiff's original employer. We reversed and remanded upon the basis that a fact issue was presented which required disposition by trial. Rix v. Turnbull-Novak, Inc., 8 Cir., 245 F.2d 809. We stated (at page 812):

"We make no decision upon any of the facts other than to declare that the court erred in granting the motion for summary judgment. * *"

The case upon remand was tried by the court upon the merits. The court found defendant was not a successor in interest to J. Gordon Turnbull, Inc.; and also found that plaintiff had not sought to be returned to the position he had when he was inducted, but had contracted for a higher position carrying more salary and responsibility; and that plaintiff was not protected in such position by the Act. Rix v. Turnbull-Novak, Inc., D.C.W.D. Mo., 159 F.Supp. 199. Plaintiff asserts that he is entitled to a reversal for the following reasons:

1. The District Court erred in holding that the defendant was not the "successor in interest" of J. Gordon Turnbull, Inc. within the meaning of that phrase as used in 50 U.S.C.A.Appendix § 459.

2. The District Court erred in holding that the veteran lost his reemployment rights under the Selective Service Act of 1948 by accepting from his pre-induction employer a different job from the one he had held prior to his induction.

The facts of this case are largely stipulated, and are fully set out in our prior opinion and in the District Court's opinion. We shall briefly summarize the facts pertinent to this appeal.

J. Gordon Turnbull, Inc., was an architectural and engineering firm, with offices in various parts of the United States and in some foreign countries. The corporation had an office at Kansas City. Novak was a vice president of the corporation and had charge of the Kansas City office. Plaintiff, prior to his induction, was employed by J. Gordon Turnbull, Inc., at Kansas City, as an inspector at a salary of $500 per month. The salary and duties of an inspector remained the same at the time of Rix's reemployment. Rix, at the termination of his military service, did not request restoration to his pre-induction position, but, instead, entered into negotiations which resulted in his entering into a contract for a higher position, as assistant manager, which carried a salary of $700 per month. There is a fact dispute as to whether Rix was to be paid a bonus in addition. Rix assumed the duties of his new position on February 15, 1953, which was within 90 days of the termination of his military service. J. Gordon Turnbull, who was the president, sole owner, and guiding influence of J. Gordon Turnbull, Inc., died on April 1, 1953. His death seriously disrupted the business of the corporation, and Mrs. Turnbull, who succeeded her deceased husband as president of the corporation, was undecided as to what she would do with the business. On May 27, 1953, Novak, for J. Gordon Turnbull, Inc., talked to plaintiff and told him that Mrs. Turnbull was uncertain as to the future of the business, that she wanted to reduce expenses, and that it would be necessary for plaintiff to take his former position as inspector at $500 per month or terminate his employment. Novak testified that Rix stated that he would not take a salary cut, and that Rix said he would have no trouble in finding a suitable position elsewhere. Further talks were had between plaintiff and Novak in which plaintiff was advised that something would soon have to be done to terminate his employment. It is stipulated:

"On July 15, 1953, Ed. G. Novak, acting as Vice President of J. Gordon Turnbull, Inc., advised plaintiff he could have the last fifteen days of July on full pay to look for other work, but would not be paid after July 31, 1953."

Upon the basis of this evidence, the trial court made the following finding:

"There is no question about the plaintiff having been discharged by J. Gordon Turnbull, Inc., after considerable discussion as to whether he would remain in another position. On July 15, 1953, a letter was addressed to him by Novak for that company, terminating his services as of that date, but continuing his pay until July 31, 1953."

Plaintiff's full salary through July 31, 1953, was paid by J. Gordon Turnbull, Inc.

On July 8, 1953, Novak reached an agreement with J. Gordon Turnbull, Inc., to take over the Kansas City office lease, purchase the office fixtures, and take over certain uncompleted contracts. Turnbull-Novak, Inc., the defendant in the present action, was incorporated on July 31, 1953. Novak was a minority stockholder in the new corporation. None of the defendant's stockholders held any stock in J. Gordon Turnbull, Inc. After the incorporation of the defendant was completed, the assets which Novak had contracted to purchase were turned over to the new corporation. Plaintiff did no work for J. Gordon Turnbull, Inc., or the defendant after July 15, 1953. Plaintiff obtained other employment on August 17, 1953, at the rate of $528 per month, which employment continued beyond one year from the date of plaintiff's return from service.

The applicable parts of 50 U.S.C.A.Appendix § 459, upon which plaintiff relies, are quoted at pages 199 and 200 of 159 F.Supp. of the District Court's opinion. It is undisputed that plaintiff is a veteran eligible for reemployment benefits conferred by the Act. The Act requires that upon the veteran's application for reemployment made within 90 days after completion of military service he shall be restored by his employer or his employer's successor in interest to his pre-service position or to a position of like seniority, status, and pay. The Act further provides that the veteran shall not be discharged from such position without cause within one year of such restoration. The provision placing reemployment obligations upon the successor in interest first appeared in the Selective Service Act of 1948. Under prior acts the veteran had reemployment rights only against his employer. The statute does not define "successor in interest," and there is no legislative history which offers any aid in ascertaining the intention of Congress. No cases have been cited or found which interpret the successor in interest provision of the Act. Inasmuch as this case must be affirmed for the reasons hereinafter set out whether or not the defendant is a successor in interest, we express no opinion upon the successor in interest issue. We shall assume for the purposes of this case, without so deciding, that the defendant is a successor in interest of the original employer.

Reemployment rights of veterans under the Act are quite fully discussed in Fishgold v. Sullivan Drydock & Repair Corp., 328 U.S. 275, 66 S.Ct. 1105, 90 L.Ed. 1230. The Court states in 328 U.S. at page 287, 66 S.Ct. at page 1112 "The `position' to which the veteran is restored is the `position' which he left plus cumulated seniority."

It is established here beyond question that the plaintiff...