Court Opinion

ID: 9564591
Source: CourtListenerOpinion
Date Created: 2023-08-21 19:03:47.459271+00
Date Added: 2024-06-11T09:18:32.463375
License: Public Domain

SCHAUER, J.,
Dissenting. — The reasoning and conclusions expressed for the District Court of Appeal (when this case was before that court) by Presiding Justice Bray and concurred in by Justices Tobriner and Duniway (as reported in (Cal.App.) 5 Cal.Rptr. 600) in my view typify integrity of the juridical process and benefit clarity of the law. I would adopt that court’s opinion and annul the commission’s award of punitive damages.
I use the phrase “award of punitive damages” advisedly. As pointed out in the opinion of the District Court of Appeal (p. 607 [7, 8] of 5 Cal.Rptr.), “Although the employee gets the benefit of any sum awarded, it must be remembered that we are not dealing with a question of compensation for an injury (the employee has already received this) but with a penalty placed upon the employer for an act so serious and wilful that the employer may not insure against it. [Ins. Code, § 11661.1] Also ‘the statute works both ways — hence the importance of correctly defining its terms. . . .’ [Hawaiian Pineapple Co. v. Industrial Acc. Com. (1953), 40 *272Cal.2d 656, 664 (225 P.2d 432).] That is, the type of act which would cause the employer to be penalized must likewise be the type of act which would cause the employee to be penalized if performed by him. ’ ’
The majority opinion makes out a clear case of negligence— probably gross negligence — but it fails to show “serious and wilful misconduct” within the established meaning of that term. Such opinion does not show that a crime was committed by the employer’s foreman (i.e., that in his culpable act there was a “union or joint operation of act and intent, or criminal negligence” (Pen. Code, § 20)) or that the foreman was guilty of “oppression, fraud, or malice.” (See Civ. Code, § 3294, which defines the basis for punitive damages in a civil tort action.) To me it appears illogical — and detrimental to the objectives of the Workmen’s Compensation Act — to so construe that act as to impose on employers and, hence, necessarily on employes (see Lab. Code, § 45512; Mercer-Fraser Co. v. Industrial Acc. Com. (2953), 40 Cal.2d 202, 209 [5, 6] [252 P.2d 955]), the drastic sanctions, respectively, of punitive damages against the employer and penal forfeiture against the employe of one-half “the compensation otherwise recoverable” for conduct less culpable than would support such penalties under the law of either crimes or torts.
In Lambreton v. Industrial Acc. Com. (2956), 46 Cal.2d 498, 504 [3] [297 P.2d 9], we said, “ [I]n proceedings before the Industrial Accident Commission, a claim for normal benefits and a claim for increased benefits by reason of serious and wilful misconduct are not sought upon the same general set of facts, nor do they involve merely a difference or change in legal theory. The relief sought is not the same; the legal liability is not the same; and the ‘proceedings’ to recover the benefits as respectively provided are recognized as being different. (Lab. Code, § 5407.) [4a] Normal benefits automatically follow from an injury within a covered employment relationship, whereas the additional award based on serious and wilful misconduct of the employer is an additional award which, although denominated and regarded for administrative purposes as ‘increased compensation’ is actually of the nature of a penalty, which is imposed . . . only upon proof of the aggravated criminal or quasi-criminal behavior which con*273stitutes serious and wilful misconduct, and against which the employer cannot purchase insurance.”
Again it should be emphasized that “While [Lab. Code] section 4553 provides for an additional one-half of the normal compensation where the employer’s ‘serious and wilful misconduct ’ causes the injury, section 4551 provides that ‘Where the injury is caused by the serious and wilful misconduct of the injured employee, the compensation otherwise recoverable therefor shall be reduced one-half. . . .’ The words ‘serious and wilful misconduct’ must be given the same meaning in each section. (Parkhurst v. Industrial Acc. Com. (1942), 20 Cal.2d 826, 831 [129 P.2d 113]; E. Clemens Horst Co. v. Industrial Acc. Com. (1920) . . . 184 Cal. 180, 188 [193 P. 105, 16 A.L.R. 611].) It was suggested in the Mercer-Fraser case that in determining whether an employer’s misconduct would justify increasing an award it would be significant to determine first whether that same misconduct would justify reducing an award made to the one responsible for the misconduct were he the injured party.” (Hawaiian Pineapple Co. v. Industrial Acc. Com. (1953), supra, 40 Cal.2d 656, 664 [11].)
It has been the law of this state for many years that penalties are not favored but must be created by unambiguous language (Occidental Building & Loan Assn. v. Sullivan (1882), 62 Cal. 394, 398) and that “every reasonable intendment is indulged to avoid a penalty.” (San Diego Humber Co. v. Wooldredge (1891), 90 Cal. 574, 579 [27 P. 431], quoted and followed in Britt v. De Turk (1900), 130 Cal. 241, 243 [62 P. 462].) Again in Thompson v. San Francisco Gas etc. Co. (1912), 20 Cal.App. 142, 144 [128 P. 347], the principle is elaborated: “Penalties are never favored either by courts of law or equity. ‘ Every intendment and presumption is against the person seeking to enforce the penalty or forfeiture provided by such a statute. ’ (Savings & Loan Society v. McKoon [1898], 120 Cal. 177, [179] [52 P. 305]; Irvine v. McKcon [1863], 23 Cal. 472 [474-475].)” See also City Lincoln-Mercury Co. v. Lindsey (1959), 52 Cal.2d 267, 276 [12] [339 P.2d 851] and General Motors Accept. Corp. v. Kyle (1960), 54 Cal.2d 101, 111-112 [11] [4 Cal.Rptr. 496, 351 P.2d 768]. The majority opinion transgresses the sound rules above quoted by extending beyond the clear and well established meaning of the statutory language the circumstances in which the Industrial Accident Commission may im*274pose punitive damages against an employer and necessarily, in like circumstances, forfeitures against employes.
Such construction may in this ease appear at first glance to operate for the benefit of the injured workman by giving him, in addition to his compensation, the penalty assessed against the employer. But this is a short-sighted view. The definition of conduct requiring imposition of the penalty as enlarged today against the employer — assuming, of course, common honesty and equal fairness in application of the rule — is the definition which from today on must control the forfeiture against employes of one-half “the compensation otherwise recoverable” when their conduct is comparable to that of the foreman here. Such judicial increment to the bases for imposition of penalties and forfeitures is not only obnoxious to the general rules above mentioned but is inconsistent with the direction of Labor Code, section 3202, that “The provisions of . . . this code shall be liberally construed by the courts with the purpose of extending their benefits for the protection of persons injured in the course of their employment. ’ ’
For all of the reasons above stated I concur in the conclusions of Presiding Justice Bray and Justices Tobriner and Duniway, and would annul the punitive damage award.
McComb, J., concurred.

Insurance Code, $ 11661: “An insurer shall not insure against the liability of the employer for the additional compensation recoverable for serious and wilful misconduct of the employer or hi? agent.”

Labor Code, § 4551: “Where the injury is caused by the serious and wilful misconduct of the injured employee, the compensation otherwise recoverable therefor shall be reduced one-lialf . . .”