Source: http://www.chanrobles.com/usa/us_supremecourt/259/530/case.php
Timestamp: 2019-11-20 19:19:05
Document Index: 138633243

Matched Legal Cases: ['§ 3020', '§ 5206', '§ 1755', '§ 3572', '§ 3769', '§ 2422', '§ 11', '§ 1', 'Art. 594']

PRUDENTIAL INS. CO. V. CHEEK, 259 U. S. 530 (1922) - US SUPREME COURT DECISIONS ON-LINE
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223 S.W. 754 affirmed. chanroblesvirtualawlibrary
Robert T. Cheek sued the Prudential Insurance Company of America in the Circuit Court of St. Louis to recover damages upon a cause of action set forth in two counts: first, that the company, being a New Jersey corporation conducting a life insurance business in Missouri under license of the insurance department of that state, and plaintiff having been for more than ten years continuously employed in its service, and having resigned said employment and left the company's service, plaintiff demanded of defendant's superintendent a letter setting forth the nature and character of the services rendered by him to said corporation and the duration thereof, and truly stating for what cause plaintiff had quit said service; that defendant, acting through its superintendent, without just cause refused to give to plaintiff such a letter as provided by statute, and, because of this, plaintiff had been unable to secure employment and had suffered substantial damages. The second count was based upon an alleged unlawful agreement between defendant and two other companies, the Metropolitan Life Insurance Company and the John Hancock Mutual Life Insurance Company, said companies having a monopoly of the industrial life insurance business in St. Louis, to the effect that chanroblesvirtualawlibrary
A general demurrer interposed to each count was sustained by the trial court, and, plaintiff declining to plead further, judgment was rendered for defendant, from which plaintiff appealed to the supreme court of the state. That court, construing § 3020, held that it imposed a duty not upon the superintendent or manager personally, but upon the corporation, acting through its superintendent or other proper officer, to issue the letter; that, the statute having imposed his duty for the public benefit chanroblesvirtualawlibrary
On the issues so made up, the case went to trial and resulted in a verdict in favor of plaintiff upon both counts. Defendant, having reserved its constitutional points, appealed from the resulting judgment to the Supreme Court, which, however, refused to take jurisdiction on the ground that all constitutional questions had been decided on the former appeal, and that the verdict, being for only $1,500, was less than the jurisdictional amount required by statute, and hence transferred the cause to the St. Louis Court of Appeals for final disposition. Cheek v. Prudential Ins. Co. of America, 209 S.W. 928. Defendant, treating this decision of the Supreme Court as a final judgment reviewable by writ of error from this Court, sued out such a writ, and, upon the ground that the judgment chanroblesvirtualawlibrary
The argument in support of the contention that the Service Letter Act is repugnant to the due process of law clause of the Fourteenth Amendment, in brief, is that, at common law, an employer is under no obligation to give a testimonial of character or clearance card to his employee; that no man is compelled to enter into business relations with another unless he desires to do so, and, upon the dissolution of such relations, no man can be compelled to divulge to the public his reasons for such dissolution; that it is a part of every man's civil rights that he be at liberty to refuse business relations with any other person, whether the refusal rests upon reason or is the result of whim, caprice, or malice, and with his reasons neither the public nor third persons have any legal concern, and that, in the absence of a contract, either employer or employee may sever the relation existing between them for any reason, or without reason, and may not be compelled to divulge chanroblesvirtualawlibrary
The statute in question is of this character; in it, the legislature has recognized that, by reason of the systematic methods of engaging and dismissing employees that chanroblesvirtualawlibrary
That statutes having the same general purpose, though sometimes less moderate provisions, have been adopted in other states, attests of widespread belief in the necessity for such legislation. Indiana Rev.Stats. 1901 (Horner) § 5206r; Acts 1911, c. 178; Acts 1915, c. 51. Montana Rev.Codes 1907, §§ 1755-1757. Nebraska Rev.Stats. 1913, §§ 3572-3574. Oklahoma Rev..Laws 1910, § 3769. Texas chanroblesvirtualawlibrary
Atchison, Topeka & Santa Fe Ry. Co. v. Brown, 80 Kan. 312, held that a service letter statute of that state (Laws 1897, c. 144; Gen.Stat. 1901, § 2422) was repugnant chanroblesvirtualawlibrary
to § 11 of the Bill of Rights of the state, and "an interference with the personal liberty guaranteed to every citizen by the state and federal Constitutions." The section of the bill of rights relied on was: "All persons may freely speak, write or publish their sentiments on all subjects, being responsible for the abuse of such right." This, of course, has no present significance. The reference to the federal Constitution was to § 1 of the Fourteenth Amendment, but the opinion does not indicate what bearing, if any, the due process of law clause was deemed to have. It appears, rather, that the right to discharge a servant for any reason, or for no reason, was thought to be one of the "privileges or immunities of citizens of the United States." But, as this Court more than once has pointed out, the privileges or immunities of citizens, protected by the Fourteenth Amendment against abridgment by state laws are not those fundamental privileges and immunities inherent in state citizenship, but only those which owe their existence to the federal government, its national character, its Constitution, or its laws. 83 U. S. 72-74, 83 U. S. 77-80; Duncan v. Missouri, 152 U. S. 377, 152 U. S. 382; Maxwell v. Bugbee, 250 U. S. 525, 250 U. S. 538. The reasoning of the Supreme Court of Kansas in this case is not convincing. The case was cited in Coppage v. Kansas, 236 U. S. 1, 236 U. S. 24, not, however, in approval of its views upon the question now presented, but in order to show that the Court had recognized that, under the law of the state, an employer might discharge his employee for any reason or without reason, and could not be compelled to give a reason where one did not exist -- a view inconsistent, as we thought, with the same Court's decision in the [email protected] case, then under review.
The Legislature of Texas placed upon the statute book an act aimed at "blacklisting" (Rev. Civil Stats.1911, Art. 594), which required that any corporation or receiver of the same, doing business in the state, having discharged chanroblesvirtualawlibrary
Opinion of the Justices, 220 Mass. 627, is an advisory opinion to the senate of the commonwealth upon a proposed chanroblesvirtualawlibrary
The cases cited from Georgia, from Kansas, and from Texas place material dependence upon provisions of the several state constitutions guaranteeing freedom of speech, from which is deduced as by contrast a right of privacy called the "liberty of silence," and it seems to be thought that the relations between a corporation and its employees and former employees are a matter of wholly private concern. chanroblesvirtualawlibrary
Previous decisions of this Court are far from furnishing support for the contentions of plaintiff in error. Allgeyer v. Louisiana, 165 U. S. 578, related to legislation of a wholly different character, and contains nothing that bears upon this. Lochner v. New York, 198 U. S. 45, dealt with a statute concededly valid if enacted in the interest of the public health, and held it void on the ground that, in truth, it was not, within the fair meaning of the term, a health law, but was an illegal interference with the right of individuals to make contracts upon such terms as they might deem best. Adair v. United States, 208 U. S. 161, 208 U. S. 174-175, and Coppage v. Kansas, 236 U. S. 1, 236 U. S. 17, dealt with statutes -- the former with an act of Congress making it criminal for a common carrier in interstate commerce to discharge an employee because of his membership in a labor organization, the latter with a state law making it criminal to prescribe as a condition upon which one might secure or retain employment that the employee should agree not to become or remain a member of any labor organization while so employed, and this in the absence of contract between the parties, coercion on the part of the employer, or incapacity or disability on the part of the employee. In accord with an almost unbroken current of authority in the state courts holding statutes of that character to be invalid, this Court came to a like conclusion. In the latter case, there was a direct interference with freedom in the making of contracts of employment not asserted to have relation to the public health, safety, morals, or general welfare beyond a purpose to favor the employee at the expense of the employer, and chanroblesvirtualawlibrary
As has been shown, the Missouri statute interposes no obstacle or interference as to either the making or the termination of contracts of employment, and prescribes neither terms nor conditions. The supreme court of the state, having ample knowledge of the conditions which gave rise to the particular legislation, declares with an authority not to be denied that it was required in order to protect the laboring man from conditions that had arisen out of customs respecting employment and discharge of employees introduced by the corporations themselves. It sustains the act as an exercise of the police power, but in truth it requires no extraordinary aid, being but a regulation of corporations calling for on application of the familiar precept, "sic utere tuo," etc., in a matter of general public concern. Except by consent of the state, the corporation, foreign or domestic, would have no right to employ laborers within its borders. A foreign corporation does not, as intimated by the court below, waive any constitutional objection by coming in. See Terral v. Burke Construction Co., 257 U. S. 529. But it has no valid objection to such reasonable regulations as may be prescribed for domestic corporations similarly chanroblesvirtualawlibrary
circumstanced. The state, with good reason, might regulate the terms and conditions of employment, including the methods of accepting and dismissing employees, so as to prevent the corporations from producing undue detriment to the individuals concerned, either while employed or when afterwards they are called upon to seek other employment. In our opinion, no danger of "blacklisting" is necessary to justify legislation requiring that corporations dismissing employees furnish them with a certificate stating the period of the service, its nature and character, and the cause, if any, that led to its termination. It might be recognized that in the highly organized conditions of industry now prevailing -- largely developed by the corporations themselves, and to which their success is greatly due -- it is not to be expected that unemployed men can obtain responsible employment without some credentials proceeding from a former employer. The legislature might believe it to be well understood that a period of employment by a corporation -- notably so in the case of insurance companies -- is a test of capacity, fidelity, and the other qualities that go to make efficiency; that such a corporation may operate as a training school, fitting employees not only for its own, but for other lines of employment. Such a training may almost inevitably produce effects upon the individuals in forming both character and reputation -- effects that cannot be brought to an end at the will of the employee or of the corporation, or both of them combined, although the employment may be terminated at the will of either, but may continue while the employee lives. His employment with the corporation remains a part of what is called his "record," by which he must be judged whenever afterwards he may be in search of employment. The reputation of the dismissed employee is an essential part of his personal rights -- of his right of personal security (1 Black.Com. 129; 3 id. 119). Even the common law regarded chanroblesvirtualawlibrary
The argument under the "equal protection" clause is unsubstantial. As we are assured by the opinion of the supreme court, the mischiefs to which the statute is directed are peculiarly an outgrowth of existing practices of corporations, and are susceptible of a corrective in their case not so readily applied in the case of individual employers, presumably less systematic in their methods of chanroblesvirtualawlibrary
The pith of the objection to the second count is that to permit a recovery against plaintiff in error on account of the agreement said to have been made between it and two other companies having a monopoly of the industrial life insurance business in the City of St. Louis, to the effect that neither of the three would within two years employ any man who had left the service of or been discharged by either of the others, was equivalent to depriving it of property without "due process of law." The Supreme Court held (192 S.W. 393) that the corporations had no lawful right to enter into a combination or chanroblesvirtualawlibrary