Seiz v. Citizens Pure Ice Co.
| Decision Date | 15 March 1940 |
| Docket Number | 32437. |
| Citation | 290 N.W. 802,207 Minn. 277 |
| Parties | SEIZ v. CITIZENS PURE ICE CO. (STATE, Intervener). |
| Court | Minnesota Supreme Court |
Appeal from District Court, Goodhue County; W. A. Schultz, Judge.
Action for a declaratory judgment by Benjamin Seiz against the Citizens Pure Ice Company for a determination as to the rights, status, and legal relations of the plaintiff and defendant under the Unemployment Compensation Act, wherein the State of Minnesota intervened. From an adverse judgment the State of Minnesota appeals.
Judgment reversed, with directions to dismiss the action.
In action by employee against employer, wherein the state intervened, for a declaratory judgment that the section of the Unemployment Compensation Act excluding all employers of less than eight employees, where the services of all of such employees are performed outside of the corporate limits of a city, village, or borough of 10,000 or more population, as unconstitutional, there was no " justiciable controversy" to give the court jurisdiction, where the employee was not unemployed, since neither the employer nor the employee had an adverse interest against the other. Laws 1939, c. 443, § 1H(6)(k), Laws 1936, Ex.Sess., c. 2 § 2; Social Security Act, 42 U.S.C.A. § 301 et seq.
Syllabus by the Court .
A proceeding for a declaratory judgment must be based on a justiciable controversy for lack of which the appellate court will reverse for want of jurisdiction of the subject matter although the point has nowhere been raised.
J. A. A. Burnquist, Atty. Gen., Chester S. Wilson, Deputy Atty. Gen., and Kent C. van den Berg, Sp. Asst. Atty. Gen., for appellant.
Nichols, Mullin & Farnand, of Minneapolis, for respondent.
This is an action for a declaratory judgment. The complaint alleges the enactment of Ex.Session Laws 1936, c. 2 (Mason Minn.St.1938 Supp. c. 23AA), establishing a state unemployment compensation system conforming to the criteria of the Federal Social Security Act (49 Stat. 620, 42 U.S.C.A. c. 7, § 301 et seq.), and the amendment of the 1936 state law by L.1939, c. 443. The provisions of the statutes shall be stated only so far as here pertinent.
The 1936 statute establishing the state unemployment compensation system declares that it was enacted under the police power of the state ‘ for the compulsory setting aside of unemployment reserves to be used for the benefit of persons unemployed through no fault of their own’ to alleviate economic insecurity due to unemployment as a serious menace to the health, morals and welfare of the people, to encourage employers to stabilize employment and by providing benefits to the unemployed to maintain purchasing power and limit the serious social consequences of poor relief assistance. The act establishes the state unemployment compensation fund (sec. 3), which is derived from taxes exacted of employers subject to the act computed on a basis of employment and payrolls. The act is administered by the unemployment compensation commission through which the fund is disbursed. A comprehensive plan is set up for the payment from the fund of unemployment benefits to workers employed within the state by designated classes of employers. The benefits are payable to the employes covered by the act during unemployment upon prescribed conditions and at prescribed rates. See: Bielke v. American Crystal Sugar Co., 206 Minn. 308, 288 N.W. 584. The benefits are not paid to the employe by his employer. Benefits can be obtained only by complying with the prescribed procedure, which requires the filing with the commission of a claim for benefits by the employe, investigation thereof by a referee with right of review and appeal to the courts. Section 8(f) of the act provides that ‘ judicial review thereof [a decision by the commission] shall be permitted only after any party claiming to be aggrieved thereby has exhausted his remedies before the commission, as provided by this Act.’
The employe has nothing to do with the collection of the tax from the employer. Payment of the tax is enforced against the employer by civil action in the name of the commission. Section 14(b).
Although the federal social security law applies only to employers of eight or more employes, our 1936 statute made no such distinction.
Laws 1939, c. 443, section 1 H(6)(k), which amended the 1936 act, among other things excludes all employers of less than eight employes, where the services of all of such employer's employes are performed outside of the corporate limits of a city, village or borough of 10,000 or more population, as determined by the last United States census.
Plaintiff alleges that he has been for many years, was at the time of the commencement of this action, and expected to continue to be employed as an engineer by defendant in its ice manufacturing plant in the city of Red Wing; that the defendant employs less than eight persons; that under the 1936 law plaintiff was entitled to unemployment benefits in the event of unemployment, which he actually received in 1938; that Red Wing is a city of less than 10,000 population according to the last census; that the effect of the 1939 amendatory act is to exclude plaintiff from unemployment benefits, and to exempt defendant from obligation to pay unemployment taxes, thereby depriving plaintiff of rights which he enjoyed and relieving defendant of obligations under the 1936 act; and ‘ that at times during the years to come the said plaintiff, whose life work and occupation is that of an employe, as defined in said act, will be unemployed and will be denied the benefits of said act if his prayer for relief is not granted.’
It is alleged that plaintiff asserts and maintains that the 1939 amendatory law is unconstitutional as class legislation violative of the provisions of the state and federal constitutions; that defendant asserts and maintains that the act is constitutional; and that ‘ various questions' have arisen and exist between plaintiff and defendant as to their respective rights, status and legal relations with respect to unemployment compensation with resulting ‘ uncertainty and insecurity’ on the part of each of them regarding such matters. The prayer is for judgment determining ‘ the rights, status and legal relations of plaintiff and defendant under the Unemployment Compensation Act, and removing the uncertainty and insecurity now existing with respect thereto, declaring, adjudging and decreeing that said subsection H-(6)(k), Section 1, Chapter 443, Session Laws of Minnesota, for 1939, is invalid, void and unconstitutional under the Constitution of the State of Minnesota and of the United States of America.’
The answer in effect admitted all the allegations of the complaint except that the 1939 amendatory act was unconstitutional. The attorney general intervened on behalf of the state, adopting the allegations of the answer. Plaintiff's motion on the pleadings for judgment was granted.
Unemployment benefits cannot be recovered directly from the employer. Plaintiff makes no such claim. He asserts no right, present or future, against the defendant. He claims a right in the future to unemployment benefits from the fund which is contingent upon his becoming unemployed. In the final analysis the complaint demands an advisory opinion as to plaintiff's future right to unemployment benefits in the contingency of his future unemployment and to defendant's liability to pay the tax.
The case was argued and submitted before we had the record and appellant's printed brief. The presentation was upon the assumption that the case presented a justiciable question concerning the constitutionality of the 1939 amendatory act. The argument was confined to the constitutional questions without a consideration of the right of the parties to maintain the action under the declaratory judgments statute. Before there can be any consideration of the constitutional questions it must appear that we have a case before us for the exercise of the judicial function.
Proceedings for a declaratory judgment must be based on an actual controversy. The controversy must be justiciable in the sense that it involves definite and concrete assertions of right and the contest thereof touching the legal relations of parties having adverse interests in the matter with respect to which the declaration is sought and must admit of specific relief by a decree or judgment of a specific character as distinguished from an opinion advising what the law would be upon a hypothetical state of facts. Mere differences of opinion with respect to the rights of parties do not constitute such a controversy. This court of its own motion will reverse for want of jurisdiction of the subject matter where it appears there is no real controversy, on the grounds that there is no proper case for a declaratory judgment and the judicial function does not comprehend the giving of advisory opinions. County Board of Education v. Borgen, et al., 192 Minn. 512, 257 N.W. 92. In the Borgen case plaintiff...
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