Workmen's Compensation Board v. Abbott

• Decision Date: 18 December 1925
• Citation: 212 Ky. 123
• Parties: Workmen's Compensation Board of Kentucky v. Abbott, et al.
• Court: United States State Supreme Court — District of Kentucky

212 Ky. 123

Workmen's Compensation Board of Kentucky v. Abbott, et al.

Court of Appeals of Kentucky. Common Pleas Branch, Third Division.

Decided December 18, 1925.

1. Master and Servant — Compensation Board May Appeal to Supreme Court from Judgment of Circuit Court. — In view of Kentucky Statutes, section 4936, providing for appeal in compensation cases from circuit court to Supreme Court, and in view of section 4935, providing for appeal from decision of Workmen's Compensation Board to circuit court, giving board right to appear in circuit court, board has right to be heard in circuit court, and appeal from any judgment in all cases where amount involved is appealable to Supreme Court.

2. Master and Servant — Circuit Court Without Jurisdiction to Enter Judgment on Compromise Without Consent of Compensation Board. — Circuit court, on appeal to it in compensation cases under Kentucky Statutes, section 4935, has not jurisdiction to enter judgment based on compromise between parties without consent of Workmen's Compensation Board.

3. Constitutional Law — Constitutional Protection of Right to Contract Extends Only to Legal Contracts. — Constitutional protection of right to contract is confined to legal contracts and may not be invoked to guarantee right to make or enter into illegal and properly forbidden contracts.

4. Constitutional Law — "Police Power" Defined. — "Police power" generally is right of legislature, or on proper occasion right of courts, to regulate, deal with, curtail, or even prohibit certain engagements, conduct, or acts tending to suppress or injuriously affect movements, measures, or schemes in furtherance of permissible and authorized public policy.

5. Constitutional Law — Right of Legislature to Declare what is Proper Public Policy in Respect to Police Power Held Limited Only by Prohibition Against Arbitrary Action. — Right of legislature to declare what is proper public policy so as to regulate exercise of police power is limited only by consideration that its action may not be arbitrary but must be rested on some tangible and reasonably clear public purpose to be served, and which has a reasonably substantial tendency to further interests of public welfare.

6. Constitutional Law — "Public Policy" Defined. — "Public policy" regulating exercise of police power is principle which declares that no one can lawfully do that which has tendency to be injurious to public welfare.

7. Master and Servant — Workmen's Compensation Act Authorized Under Police Power. — Workmen's Compensation Act is authorized under police power as furthering sound public policy.

8. Constitutional Law — Master and Servant — Law Prohibiting Compromise Without Consent of Compensation Board Held Constitutional. — Legislature has power to regulate compromise of payment of compensation under Workmen's Compensation Act and to prohibit such agreement unless entered into in accordance with terms of act which requires consent of compensation board, notwithstanding Bill of Rights, sections 1 and 2, relating to freedom to contract, and of due process clause of state and federal Constitutions (Constitution Kentucky, section 14; Constitution U.S. Amendment 14).

9. Constitutional Law — Legislature May Prohibit Assignment of Claims for Workmen's Compensation. — Legislature has power to prohibit assignment of claims for compensation under Workmen's Compensation Act, which it did in Kentucky Statutes, section 4913.

10. Master and Servant — Compromise Can Only Be Entered into with Approval of Workmen's Compensation Board. — Kentucky Statutes, section 4889, prohibiting contract to relieve employer of any obligation created by Workmen's Compensation Act, except as therein provided, does not refer to withdrawing provision, section 4959, but refers to obligation about which there were provided conditions under which permissible agreement might be made under sections 4907 and 4931, both of which require consent and approval of compensation board, and any agreement between employer and employe to compromise liability for compensation, to be legal, must be approved by compensation board.

Appeal from Jefferson Circuit Court

FRANK E. DAUGHERTY, Attorney General, and GARDNER K. BYERS, Assistant Attorney General, for appellant.

SELLIGMAN & SELLIGMAN and NORTON L. GOLDSMITH for appellees.

OPINION OF THE COURT BY JUDGE THOMAS.

Sustaining motion for appeal and reversing the judgment.

The appellee, L.V. Abbott, was engaged in the business of an architect, engineer and builder in the city of Lousville and was subject to the provisions of our statute known as the "Workmen's Compensation Act" (hereafter referred to as "the act.") He had in his employ the appellee, Thomas J. McGuire, who was 28 years old and otherwise sui juris. Both Abbott and McGuire had accepted the provisions of the act, and the latter sustained an injury covered by it. He made application to the compensation board and it rendered an award in his favor for certain allowable items, and in addition found that he had sustained 10 per cent permanent partial disability for which he was compensated at the rate of $1.20 per week for 335 weeks. After crediting the award with payments that had been theretofore made by the employer, the total amount of it was less than $500.00 and more than $200.00. The employer, who disputed the correctness of the award in making any allowance for any per cent of permanent disability, appealed the case to the Jefferson circuit court in the manner provided by the act, and to which appeal the board, as the act requires, was made a party. While the appeal was pending Abbott and McGuire reached an agreement, without consulting or in any manner obtaining the consent of the board, whereby, in consideration of the payment by the employer to the employee of $457.00, the award and all claims arising under the act were compromised and settled. That agreement was reduced to writing and signed by both Abbott and McGuire, and was filed in the circuit court in which the appeal was pending, accompanied by a motion that the court render judgment in accordance with the agreement, to which the board objected by a special demurrer to the jurisdiction of the court to render any such judgment; but the court ruled against it, to which it excepted. The motion made by appellees was sustained and judgment rendered in accordance with the agreement, to reverse which the board has filed a transcript of the record in this court with a motion for an appeal.

Before taking up the questions argued on the merits of the case we will first briefly consider a question of practice raised by an amicus curiae brief filed in the case by permission of this court. It is, that the board has no right or authority to prosecute an appeal in this class of cases from the circuit court to this one. Involved in that question is the further one as to the extent of the board's interest in the matters involved, i.e., whether under the act it is only a mere nominal party to the proceedings on appeal either to the circuit or to this court; or whether it has, as the representative of the public, a substantial interest beyond that of a mere nominal party, and which question will be hereinafter answered to the effect that it is more than a mere nominal party. Notwithstanding that fact, however, it, perhaps, would have been competent for the legislature to deny it the right of appeal to this court and to have conferred it alone on the employer and the employee; but the fact that the board is more than a nominal party and represents some substantial interests of the public in the due and proper administration of the act (as hereinafter shown) is persuasive that the legislature did not intend to withhold from it the right of appeal so that it might protect that interest in this court to which an appeal may be taken; and, therefore, such right should not be denied, unless the act does so in clear and explicit terms. The provisions for an appeal to the circuit court are contained in section 52 of the act, now section 4935 of our statutes, and, of course, the board could scarcely be an appellant to the circuit court, since the appeal is from its award, which, however, is untrue with reference to the judgment of the circuit court on review of the award. Therefore, we do not attribute any particular significance to the word "party" in that section with reference to who may appeal from the award of the board to the circuit court. Section 53 of the act, now section 4936 of our statutes, makes provisions for an appeal to this court from the judgment of the circuit court and it is therein provided that the scope of this court's review "shall include all matters herein made the subject of review by the circuit court and also errors of law arising in the circuit court," &c. It is then further provided that "The procedure as to an appeal to the Court of Appeals shall be the same as in civil actions, so far as the same may be applicable to and not in conflict with the provisions of this act, except as follows." There is then prescribed what evidence shall be brought to this court and the method by which it may be done, as well as the duty of "the appellant" in the premises, after which certain provisions are made as to the duties of the circuit clerk upon direction of "the parties" with reference to the transmission of the record to this court, as well as what it should contain. The section, supra, providing for an appeal to the circuit court says, inter alia, "The board and each party shall have the right to appear in such review proceedings," and the right to appear carries with it the further one to be heard, which latter right is not usually accorded to a mere nominal party. We, therefore, hold that it was the purpose of the act to give the board, which must be summoned on appeal to the circuit court, the right to be heard in that court and the section providing for an appeal to this court, as we have seen,...