Swick v. Glenn L. Martin Co.

• Decision Date: 23 October 1946
• Docket Number: No. 3097.,3097.
• Parties: SWICK v. GLENN L. MARTIN CO.
• Court: U.S. District Court — District of Maryland

68 F. Supp. 863

SWICK v. GLENN L. MARTIN CO.

No. 3097.

District Court, D. Maryland.

October 23, 1946.

Abraham Engelman, of Brooklyn, N. Y., and Milton Rothstein, of Baltimore, for plaintiff.

Marbury, Miller & Evans, and Charles C. G. Evans, all of Baltimore, Md., for defendant.

COLEMAN, District Judge.

This is a suit brought by the plaintiff to recover from the defendant company overtime compensation and an additional equal amount as liquidated damages and an attorney's fee alleged to be due the plaintiff under the provisions of the Fair Labor Standards Act of 1938, 29 U.S.C.A. §§ 201-219, for the period between March 5, 1941, and June 14, 1942.

In its answer the defendant set up the defense of limitations, relying upon Chapter 518, Laws of Maryland, 1945, which provides that all claims under the Fair Labor Standards Act shall be brought within three years from the time they accrue, provided, if they have accrued more than two years before June 1, 1945, the effective date of the Maryland statute, as is true with respect to the present claim, they shall be sued on within one year thereafter. Defendant has also moved for judgment on the pleadings and in the alternative, for summary judgment on the same ground. Plaintiff has filed a motion to strike as part of defendant's answer the affirmative defense of limitations on the ground that the Maryland law upon which this defense is based (1) violates Article VI of the Constitution of the United States in that it discriminates against rights arising under Federal laws and (2) violates Section 1 of the Fourteenth Amendment in that its enforcement would result in a denial of the equal protection of the laws as guaranteed by that Section of the Amendment.

Since the present suit was not filed until June 25, 1946, and since, as above stated, plaintiff's claim is alleged to have accrued more than two years prior to June 1, 1945, it is conceded, as it must be by the plaintiff, that if the Maryland statute is valid, it constitutes a complete bar to his recovery. Therefore, the sole question now before us is as the validity of this State statute.

Chapter 518 of the Laws of Maryland, 1945, which became effective on June 1st, 1945, provides as follows: "All actions brought by or on behalf of any employee or employees for the recovery of unpaid minimum wages, unpaid overtime compensation, fees and/or penalties, as the case may be, under the Fair Labor Standards Act of 1938, as amended, shall be brought within three years from the time such cause or causes of action accrued, unless such Fair Labor Standards Act shall prescribe a different period within which such action or actions may be brought; provided, however, that all such subsisting causes of action which accrued more than two years before June 1, 1945, shall be sued on within one year after June 1, 1945, unless such Fair Labor Standards Act shall provide a different period within which such causes of action may be sued on."

The Fair Labor Standards Act of 1938 contains no provision for limitations. The State statute, if valid, is, therefore, applicable. 28 U.S.C.A. § 725. Campbell v. Haverhill, 155 U.S. 610, 15 S.Ct. 217, 39 L.Ed. 280. See also, Pufahl v. Estate of Parks, 299 U.S. 217, 57 S.Ct. 151, 81 L.Ed. 133; Louisiana & W. R. Co. v. Gardiner, 273 U.S. 280, 284, 47 S.Ct. 386, 71 L.Ed. 644; Chattanooga Foundry & Pipe Works v. Atlanta, 203 U.S. 390, 397, 27 S.Ct. 65, 51 L.Ed. 241; Hall v. Ballard, 4 Cir., 90 F.2d 939, 947. At various sessions of Congress since the passage of the Fair Labor Standards Act, bills have been introduced which would insert in that Act a provision for limiting the time within which suits thereunder might be brought. But as yet, no such legislation has been enacted. During the last session of Congress, both the House and Senate passed a bill providing for a two year period of limitations (H.R. 2788, passed by the House May 20, 1946 and by the Senate, July 29, 1946). However, this bill "died" in Congress for the reason that the Senate added an amendment exempting employers from liability for unpaid overtime in certain specified situtations, thus making it necessary for the bill to be referred to a conference of both Houses. Because of the adjournment of Congress, such conference was never held.

The general statutes of limitations that are now and were in effect in Maryland at the time the plaintiff's claim is alleged to have accrued are embraced in Sections 1 and 3 of Article 57 of the Annotated Code of Maryland, 1939. Section 1 provides a three year period of limitations for suits on accounts, simple contracts, debts and torts. Section 3 provides a twelve year period for suits on bonds, judgments and other specialties. It is clear from this classification which the Legislature made, and by decisions of the Maryland Court of Appeals construing the same, which it seems unnecessary to analyze or cite here, that these provisions indicate a policy to provide a long period of limitations for obligations whose common characteristic is that proof of their existence is relatively independent of perishable records or of witnesses whose appearance may be rendered impossible by lapse of time. Obligations of this character are usually fixed as to amount and certain as to liability. On the other hand, a much shorter, namely, a three year period of limitations has been provided for causes of action whose common characteristic is their dependence on parole and other evidence extrinsic to some written instrument.

The Maryland Court of Appeals has never been called upon to decide whether actions under the Fair Labor Standards Act arising in Maryland were to be governed by the three or the twelve year limitation. However, two years ago, that is shortly prior to the enactment of Chapter 518 of the Laws of Maryland of 1945, here in issue, this Court, in Bright v. Hobbs, D.C., 56 F.Supp. 723, was called upon to decide this question. We held, as had also a decision in 1943 of the Baltimore City Court (Manhoff v. Thomsen-Ellis-Hutton Co., reported in the Baltimore Daily Record of March 17, 1943) that the twelve year provision applied — unfortunate, from the point of view of efficient administration of the particular law, as the result of such a holding might prove to be. We rested our decision squarely upon what we believed to be the inescapable interpretation of the decision of the Maryland Court of Appeals in Taggart, Ins. Com'r, v. Wachter, Hoskins & Russell, Inc., 179 Md. 608, 21 A.2d 141, 141 A.L.R. 751, which, very briefly summarized insofar as it relates to the point here at issue, is to the effect that where a statute creates a new or increased obligation, as opposed to a restriction of an obligation, the twelve year and not the three year statutory provision applies.

However, for the purposes of the present case, it would serve no purpose to linger upon a consideration of either State or Federal decisions construing the application to Federal laws of the Maryland statute of limitations prior to the enactment in 1945 of the provision here in issue. As already pointed out, there can be no question that, because of the absence of Congressional action, the various State Legislatures were left free to provide periods of limitation governing suits under the Fair Labor Standards Act, provided they did not infringe upon the established constitutional principles surrounding Federal legislation, even though the result has been one of not only great variation in the periods allowed, but of great confusion from the effort to place suits under the Fair Labor Standards Act in their proper limitations category. For example, some decisions have held that an action under the Fair Labor Standards Act is one that is founded upon an oral contract. See Keen v. Mid-Continent Petroleum Corp., D.C., 58 F.Supp. 915, 63 F.Supp. 120, Lorber v. Rosow, D.C., 58 F.Supp. 341. Others have held that the action is founded upon a liability created by a statute other than a penalty or forfeiture. See Culver v. Bell & Loffland, 9 Cir., 146 F.2d 29; Gonzales v. Tuttman, D.C., 59 F.Supp. 858. In still other jurisdictions where the period of limitations for an oral contract and that for a liability created by statute are the same, the Courts have sometimes evaded the issue on the ground that it was unnecesssary to determine which statute applied. See Smith v. Continental Oil Co., D.C., 59 F. Supp. 91.

It is clear that even if the Maryland Court of Appeals had been called upon, prior to the enactment of the special statute here in issue, to determine into which category suits in Maryland under the Fair Labor Standards Act fell, and regardless of which way that Court might have ruled, that is, whether it held that such suits were controlled by the twelve or by the three year limitation in the general statutes, the Maryland Legislature could validly, at any time, have annulled such decision by amending the statutes. However, the Maryland Legislature has seen fit, in advance of any such decision by the Maryland Court of Appeals, to amend the general law by the 1945 enactment but it has limited that enactment to one particular type of suit under one particular Federal statute. It is this singling out of this particular Federal statute by the Maryland Legislature which the plaintiff claims amounts to a forbidden discrimination. We, therefore, pass now to a consideration of the first of the two grounds on which the plaintiff relies, namely, that the Act violates Article VI of the Constitution in that it discriminates against rights arising under Federal laws.

The provision relied on in Article VI of the Constitution is paragraph 2, which reads as follows: "This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing...