Southern Ry. Co. v. Overnite Transp. Co., 24256

• Citation: 158 S.E.2d 387,223 Ga. 825
• Decision Date: 22 November 1967
• Docket Number: No. 24256,24256
• Parties: SOUTHERN RAILWAY COMPANY v. OVERNITE TRANSPORTATION COMPANY.
• Court: Supreme Court of Georgia

Page 387

158 S.E.2d 387

223 Ga. 825

SOUTHERN RAILWAY COMPANY v. OVERNITE TRANSPORTATION COMPANY.

No. 24256.

Supreme Court of Georgia.

Nov. 22, 1967.

Rehearing Denied Dec. 7, 1967.

Syllabus by the Court

1. Code Ann. § 114-403 (Ga.L.1963, pp. 141, 145) is not void for vagueness.

2. The interstate commerce clause did not withdraw from the states the power to legislate with respect to their local concerns, even though such legislation may indirectly and incidentally affect interstate commerce and persons engaged in it.

3. While Code § 114-108 provides that Title 114 'Workmen's Compensation' shall not apply to any common carrier by railroad engaging in commerce between the several state, Code Ann. § 114-403 (Ga.L.1963, pp. 141, 145) does apply to a common carrier by railroad engaging in commerce between the several states when the plaintiff is seeking to indemnify itself for a monetary loss caused by said carrier's tortious act to the plaintiff's employee and not seeking to recover as an employee of the carrier.

4. A statute does not violate due process of law if all persons to whom the statute applies are accorded notice and a hearing applicable to all cases of a similar nature.

5. A settlement by the employee of his claim against a third party without consent of the employer does not affect the right of the employer to be indemnified.

6. The purpose of the provisions in the workmen's compensation law that give to the employer the right of subrogation is to recoup the employer's loss, to prevent a double recovery by the employee and to do substantial justice.

7. The allegations of the petition are sufficient to carry to the jury the issue of whether or not the plaintiff should be allowed to recover attorney's fees. The trial court did not err in overruling all of the demurrers.

Neely, Freeman & Hawkins, Edgar A. Neely, Jr., Atlanta, Ellsworth Hall, Jr., Macon, for appellant.

Nall, Miller, Cadenhead & Dennis, A. Paul Cadenhead, Gerald Friedlander, Atlanta, for appellee.

ALMAND, Presiding Justice.

This appeal by Southern Railway Company is from an order overruling its general and special demurrers to the petition of Overnite Transportation Co., which sought to recover the amount of $4,646.95 by reason of payments Overnite had made of workmen's compensation and medical expenses to one of its employees, Cleveland C. Trout, for injuries inflicted upon said employee by reason of the tortious conduct of the defendant Southern.

The petition alleged that plaintiff's employee, Trout, while in the course and scope of his employment was struck by one of defendant's trains and suffered bodily injury; that plaintiff had made payments of workmen's compensation and medical expenses in the sum of $4,646.95 pursuant to the Georgia Workmen's Compensation Law for the injury resulting from said accident to its employee; that Trout, plaintiff's employee, filed suit in Fulton Superior Court against the defendant on May 25, 1965; and that on June 10, 1964, July 28, 1964, August 11 and 14, 1964, and February 12, 1965, 'plaintiff, by its attorneys, notified defendant of plaintiff's subrogation rights in the amount of $4,646.95. Copies of said notices, sent by certified mail, return receipt requested, were received by defendant through its agent and counsel, and copies of same (were attached to the petition). Said notices stated that plaintiff was entitled to be subrogated to be rights of Cleveland C. Trout for the aforesaid workmen's compensation payments, and that any settlement agreement between Cleveland C. Trout and defendant should consider and give cognizance to plaintiff's subrogation rights under Code Ann. § 114-403 (Ga.L.1963, pp. 141, 145).' Further, the petition alleged that on 'August 19, 1964, and February 12, 1965, plaintiff, through its attorney Thomas A. Rice, gave notice to said Cleveland C. Trout of plaintiff's subrogation rights under Code Ann. § 114-403 (Ga.L.1963, pp. 141, 145), said notice being given in letters dated August 19, 1964, and February 12, 1965. Both letters were addressed to said Cleveland C. Trout and were sent in care of his attorney, Mr. Guy Parker. A copy of each of these letters is attached (to the petition).' After the defendant filed its answer in the tort action, the parties settled the tort action with the defendant, agreeing to pay Trout the sum of $10,000. The plaintiff's petition alleged that in 'settling case No. B-13278 without recognizing plaintiff's subrogation rights under Code Ann. § 114-403 (Ga.L.1963, pp. 141, 145), after having been given numerous notices pursuant to the edict of Code Ann. § 114-403 (Ga.L.1963, pp. 141, 145), defendant has acted in bad faith, has been stubbornly litigious, and has caused the plaintiff unnecessary trouble and expense in requiring plaintiff to prosecute this action in order to collect sums due to plaintiff under Code Ann. § 114-403 (Ga.L.1963, pp. 141, 145) and plaintiff should be awarded all expenses of this litigation, including reasonable attorney's fees, as a part of the damages.'

By its general demurrers the defendant asserts (a) that the petition failed to set forth a cause of action and (b) that Code Ann. § 114-403 (Ga.L.1963, pp. 141, 145), upon which plaintiff bases its suit, is void and of no effect for reasons that will be dealt with seriatim below.

This court has jurisdiction of the appeal by reason of the constitutional attack made upon Code Ann. § 114-403 (Ga.L.1963, pp. 141, 145).

That section provides: 'Whenever any person is called upon to pay compensation, medical expenses and/or funeral expenses on account of injury or death compensable under this Title, and such person contends that a person or persons other than the employer is liable to pay damages, on account of such injury or death, to the injured employee or those entitled to recover for the employee's death, such person called upon to make such payment may give to the persons contended to be so liable and to the injured employee or those entitled to recover on account of his death written notice of such contention and of the fact that the person giving notice is required to make such payment. Upon goving such written notice, the person called upon to make such payment shall be subrogated, to the extent of the compensation medical expenses and/or funeral expenses payable, to all rights arising out of the injury or death which the injured employee or those entitled to recover on account of his death shall have against such notified persons, and shall have a lien therefor against the net recovery of any judgment or settlement recovered by the injured employee or those entitled to recover on account of the employee's death against any of the persons so notified.'

1. It is contended that the above Act insofar as it purports to grant a right of subrogation is so uncertain, vague and indefinite, as to be void. The Act is not subject to these objections.

2. It is asserted that if common carriers engaged in interstate commerce are bound by the provisions of the above cited subrogation Act, the said Act is void and in violation of Article 1, Section 8, Paragraph 3 of the Constitution of the United States, which provides that the Congress shall have power to regulate commerce along the several states, because said Act would place an unreasonable burden upon interstate commerce.

State statutes which only relate to or indirectly affect interstate commerce or cover matters not legislated on by Congress are not invalid as interfering with or burdening interstate commerce. 15 C.J.S. Commerce § 138(1), p. 873. See Layton v. State, 165 Ga. 265, 140 S.E. 847.

'The interstate commerce clause did not withdraw from the states the power to legislate with respect to their local concerns, even though such legislation may indirectly and incidentally affect interstate commerce and persons engaged in it.' Boston & Maine R. Co. v. Armburg, 285 U.S. 234, 238, 52 S.Ct. 336, 337, 76 L.Ed. 729. Where a carrier is subject to suit by a plaintiff within the State, an attachment or garnishment of the carrier's property is not invalid as being a burden on interstate commerce. Natural Gas Pipeline Co. of America v. Slattery, 302 U.S. 300, 58 S.Ct. 199, 82 L.Ed. 276. See also Pere Marquette Ry. Co. v. Tifton Produce Co., 48 Ga.App. 286, 172 S.E. 727; 15 C.J.S. Commerce § 139, p. 881.

3. The contention of defendant that Code § 114-108 which states that the 'provisions of this Title shall not apply to any common carrier by railroad engaging in commerce between any of the several States' forbids the application of Code Ann. § 114-403 (Ga.L.1963, pp. 141, 145) to the instant case is without merit. The title of Code 114 is 'Workmen's Compensation.' The suit by the plaintiff is not one to recover compensation as an employee of the defendant, a common carrier by railroad, but is to indemnify plaint...