State of Nebraska v. Finch

• Decision Date: 29 February 1972
• Docket Number: Civ. No. 1468 L,1596 L.
• Citation: 339 F. Supp. 528
• Parties: STATE OF NEBRASKA et al., Plaintiffs, v. Robert FINCH, United States Secretary of Health, Education, and Welfare, et al., Defendants. STATE OF NEBRASKA et al., Plaintiffs, v. Elliot L. RICHARDSON, Secretary of Health, Education and Welfare, et al., Defendants.
• Court: U.S. District Court — District of Nebraska

339 F. Supp. 528

STATE OF NEBRASKA et al., Plaintiffs, v. Robert FINCH, United States Secretary of Health, Education, and Welfare, et al., Defendants.

STATE OF NEBRASKA et al., Plaintiffs, v. Elliot L. RICHARDSON, Secretary of Health, Education and Welfare, et al., Defendants.

Civ. Nos. 1468 L, 1596 L.

United States District Court, D. Nebraska.

February 29, 1972.

Calvin Robinson, Asst. Atty. Gen., for plaintiffs.

Randall Rinquest, Asst. U. S. Atty., Arthur Abraham, Deputy Asst. Gen. Counsel, Dept. of HEW., and Ed Yourman, Asst. Gen. Counsel, Dept. of HEW., of counsel, for defendants.

MEMORANDUM OF DECISION

URBOM, Chief Judge.

The State of Nebraska has sought, pursuant to 42 U.S.C.A. § 418(t) (1), judicial review of a number of deficiency assessments levied against the State of Nebraska by the Secretary of Health, Education and Welfare for contributions due from the state under an agreement between the state and the Secretary which was effective January 1, 1951. The contract, authorized by 42 U.S.C.A. § 418(a) (1), brought under the terms of the Social Security Act employees and public officials of the State of Nebraska. During the contract period the State of Nebraska did not make contributions for wages earned by justices of the peace, city constables, and registrars of vital statistics. On December 3, 1964, the Secretary of Health, Education and Welfare notified the State of Nebraska that it was being assessed for contributions due under the agreement for wages earned by Clayton R. Ward, a justice of the peace, and Lewis W. Ross, a constable in the City of Lincoln. The deficiency due for Ross totaled $190.40; for Ward, $165.88. Through four letters dated April 15, 1965, J. L. Fay notified the State of Nebraska that further deficiencies were being assessed for contributions due on the salaries for all constable positions in the City of Lincoln, the City of Omaha, and throughout the State of Nebraska; the fourth letter assessed a deficiency for contributions due on salaries earned by all justices of the peace in the State of Nebraska during the period January 1, 1951, through September 13, 1960. The State of Nebraska sought review by the Secretary for deficiencies assessed on December 3, 1964; no review was sought of the deficiencies assessed on April 15, 1965. Because review by the Secretary is a jurisdictional requirement for review by this court, only those deficiencies assessed on December 3, 1964, are properly subject to review by this court under the terms of 42 U.S.C.A. § 418(t) (1). These assessments are the subject of State v. Finch, Civ. 1468 L.

The subject matter of State v. Richardson, Civ. 1596 L, consolidated with State v. Finch, is deficiencies reviewed by the Secretary: (1) on April 13, 1965, the State of Nebraska was notified that a deficiency was being assessed in the amount of $129.11 for contributions due on salaries earned by William R. Egenberger, a registrar of vital statistics in Dawson County, Nebraska, and covered fees paid Egenberger for his services through September 13, 1960; (2) on April 15, 1966, an additional deficiency was assessed for contributions due on remuneration received for services by other registrars of vital statistics in the State of Nebraska during the year 1962; and (3) a letter dated April 17, 1967, assessed deficiencies for contributions due on salaries earned by registrars of vital statistics in the State of Nebraska during the calendar year 1963. The Secretary concluded that the deficiencies were correctly assessed. Because the state has complied fully with the requirements of 42 U.S.C.A. § 418(t) (1), these assessments reviewed by the Secretary are properly subject to review by this court.

Defendants' exhibit 1, a copy of the agreement between the State of Nebraska and the Federal Security Administrator, extends the benefits conferred by Title II of the Social Security Act to services performed by individuals as employees of the State of Nebraska. The contract contains the following pertinent provisions:

"1. DEFINITIONS. For the purposes of this agreement the parties adopt the definition of terms as set forth in Section 218 of the Social Security Act; and, the term `employee' shall mean an employee as defined in Section 210(k) of said act and shall include an officer of the state or of a political subdivision thereof. (Emphasis added)

"2. SERVICES COVERED. This agreement includes all services performed by individuals as employees of the state and as employees of those political subdivisions listed in the appendix attached hereto, ... it being the understanding of the parties that it is the intention of the State of Nebraska to provide coverage for its employees and for the employees of those political subdivisions which join with the state, on as broad a basis as is permitted under the Social Security Act."

The state excluded only those employees who would be covered by Social Security in the absence of the agreement, employees already covered by a retirement system, and those services which are specifically excluded under the Social Security Act. It was available to the state, if it so chose, to exclude employees whose remuneration was on a fee basis. Tit. 42 U.S.C. § 418(c) (3) (A) (iii) provides that:

"Such agreement shall, if the State requests it, exclude in the case of any coverage group any one or more of the following: ... positions the compensation for which is on a fee basis."

The state did not choose to avail itself of this exclusion. By agreement approved April 6, 1962, the original contract was modified to exclude the services of individuals as justices of the peace and constables, the compensation for which is on a fee basis, from coverage groups included under the original agreement. This modification did not include registrars of vital statistics; however, the Secretary assessed deficiencies for William Egenberger only up to the date of September 13, 1960, the effective date of the modification to the original agreement.

Because in its original agreement with the Secretary the state chose to cover the broadest category of employees who could be covered within the terms of 42 U.S.C.A. § 418, it is apparent that if the three positions at issue in these two cases are, under Nebraska law, either employees or officers of the State of Nebraska, they are covered by the agreement of January 1, 1951, and the deficiency assessments must be upheld.

JUSTICES OF THE PEACE

Clayton R. Ward served as justice of the peace in Platte County, Nebraska, from early 1953 until approximately March 31, 1955. During that period he earned $4,468.00. This amount was not paid as wages, but was the total of all fees collected by him in his capacity as justice of the peace. In reviewing the deficiencies assessed against the State of Nebraska for contributions due on Mr. Ward's earnings during this period, the Secretary found that justices of the peace are public officers under Nebraska law. A justice of the peace is a constitutional officer in Nebraska. The office is created by Article V, Section 1, of the State Constitution. See, State ex rel. Woolsey v. Morgan, 138 Neb. 635, 294 N.W. 436 (1950). It is the position of the State of Nebraska that because Article V, Section 18, of the Constitution of the State of Nebraska provides that justices of the peace be elected by district, the justice of the peace is an officer of the district within which he is elected, rather than an officer of the state. The boundaries of justice of the peace districts, although usually coterminous with county lines, are not uniformly so. However, I am not persuaded that merely because a justice of the peace is elected from within a district he is necessarily an officer of that district. It is apparent that the State of Nebraska exercises a considerable degree of control over the office of justice of the peace. Article V, Section 18, of the Nebraska Constitution grants to the state the power to create justice of the peace districts and to substitute other courts for the justice of the peace courts. State ex rel. Bunce v. Kubat, 110 Neb. 362, 193 N.W. 754 (1923). This control extends to determining the jurisdiction of justice of the peace courts. Bunce v. Kubat, supra. In addition, several statutes of the State of Nebraska regulate practice in the courts of justices of the peace. See, Conkling v. DeLany, 167 Neb. 4, 91 N.W.2d 250 (1958). It is the duty of the justice of the peace to administer the laws of the State of Nebraska. Their practice is to be uniform throughout the state, and no significant difference in their practice is predicated on the fact that each is elected from a separate justice of the peace district. Bunce v. Kubat, supra.

The fact that a justice of the peace is elected from the district which may not coincide with county lines does not necessarily make a justice of the peace an officer of that district. A justice of the peace is not unique in the fact that he is elected by district. For example, a representative to the Congress of the United States is elected by district in Nebraska and that district may not coincide with any other boundary in the state. It is, however, clear that a representative to the Congress of the United States is an officer of the United States, not an officer of the district in which he was elected.

The section of the Constitution of the State of Nebraska which creates the office of justice of the peace also provides for the creation of all other courts in Nebraska. There is nothing to distinguish the office of justice of the peace from other judicial offices created by Article V, Section 1, except that the jurisdiction of the justice of the peace court is specifically set forth in Article V, Section 18. Although the state has the power to substitute other courts for the justice of the peace court, the court so created must retain the same jurisdiction as did the justice of the peace court which is abolished by the substitution....