Court Opinion

ID: 3838195
Source: CourtListenerOpinion
Date Created: 2016-07-06 08:07:11.076146+00
Date Added: 2024-06-11T07:40:11.379767
License: Public Domain

The Turner Chevrolet Company, an Oregon corporation, was engaged in the garage business in Klamath Falls in the state of Oregon. This corporation also operated a garage at Tulelake in the state of California. On March 1, 1939, Marion N. House, claimant's decedent was employed by the Turner Chevrolet Company at Klamath Falls, as a salesman. He continued this employment until July 15, 1939, on which date, pursuant to a contract executed in Oregon he assumed the duties of branch manager of the Turner Chevrolet Company's garage at Tulelake in California, in which capacity he was thereafter continuously in the employment of said Chevrolet company until his death.
On or about the 9th day of October, 1939, Mr. House was a passenger on a motor vehicle owned and operated by the Turner Chevrolet Company and was on his way to a state meeting of Chevrolet dealers at Portland, Oregon. While thus traveling to Portland, he suffered an injury in an automobile collision near Bend, in the state of Oregon, which resulted in his death on October 11, 1939.
Mr. House left surviving him his widow, Winona House, and a minor daughter, Nancy Ann House, of the age of six years.
The Turner Chevrolet Company, so far as its employees employed to work in the state of Oregon, had conformed with the provisions of the Workmen's Compensation Act of the state of Oregon.
It is contended by the defendant commission that the contract of employment whereby Mr. House became branch manager of the Turner Chevrolet Company at Tulelake was executed in California, while plaintiff *Page 271 
contends that it was executed in Oregon. Two witnesses other than the plaintiff testified, namely, Mr. Archibald A. Turner, president of the Turner Chevrolet Company, and Mr. Lanier Wallen, salesman at Klamath Falls for that company.
While there is some inconsistency between Mr. Turner's testimony in the trial court, and that which he gave before the defendant commission on rehearing, I think it appears therefrom that the contract of employment was finally consummated in Oregon, although the negotiations therefor were conducted in both states.
Mr. Wallen, a salesman at Klamath Falls of the Turner Chevrolet Company, testified as follows:
"Q. Now then, you know he" [Mr. House] "went to California do you?
A. Yes, I do.
Q. Now do you know how he happened to go to California? What did they do down there when he went to California?
A. Well, you see, originally I took Marion [Mr. House] in to Mr. Balleau who hired him; he was the used car-salesman at that firm. So when the opportunity came down at the Tulelake department, why, he talked it over — Mr. Balleau and I — before he asked Marion to go down on the job. Mr. Turner took Marion down and he spent most of the day there, and then he and I discussed it all that evening at home, about whether he should take it and what kind of an agreement he thought he should get; for instance, his salary and a certain per cent of commission on the profits, and he wanted my idea what he should ask for when he made his agreement, and if I thought he would be better off to take that job or stay there with me; we were doing very good in the used car selling. So Marion and I discussed it all that evening and most of the next day, before he finally agreed to take the job, and they got together on a definite agreement, I know positively *Page 272 
the day after he was down at Tulelake because he and I discussed it and talked it over approximately all night.
Q. Did you live close to where he did?
A. We lived just across the alley from one another, and Marion stayed here in Klamath Falls — I do not know — sometime after he took the job, and drove back and forth morning and night before he found an apartment and moved his family down there."
                              *      *      *      *      *      *      *
"Q. The original contract of Marion House came up here then, — was made in Oregon?
A. That is right. I took him into the office of Mr. Balleau and introduced him. He said: `When are you ready to go to work?' Mr. House said: `I might as well go right now, I am here.' He said: `You take him over to the lot and show him around and he is on the job.'
Q. Now what happened when you went down to California? Did that take a period of several days, waiting and so on?
A. He went down just one day with Mr. Turner. I talked to him before he left and we discussed it. He told me what he thought about the job after he was down and looked it over and wanted my idea, that evening when he got back or the next day;" * * *
The uncontradicted testimony is to the effect that more cars were sold in the state of Oregon from the Tulelake branch than were sold therefrom in the state of California. Mr. Turner testified that two-thirds of Mr. House's work was in Oregon because of the selling.
The following questions and answers in Mr. Turner's cross examination also disclose that the two selling agencies in suit were not separate and distinct from one another:
"Q. Now so far as the operation and management is concerned, do they have anything in common, other than the setting of policies? *Page 273 
A. Nothing except exchanging parts and anything they might need they get from the parent concern.
Q. Now you do that with other Chevrolet garages for that matter, do you not — trade back and forth?
A. No, not on the same basis. We would not give other garages things at cost."
It appears from the testimony that the Chevrolet company in Portland grants to its dealers what is termed a direct franchise and also another franchise known as an associate franchise. At the time the contract of employment was executed between the Turner Chevrolet Company and Mr. House, and at all times Mr. House worked thereunder at Tulelake, and when the fatal accident occurred, the Tulelake branch had a direct franchise with the Chevrolet company in Portland.
A direct franchise calls for a certain discount which an associate franchise does not get.
When asked whether the direct franchise held by the Tulelake branch had anything to do with the franchise held in Klamath Falls, Mr. Turner, the president of the Turner Chevrolet Company, said: "Nothing other than the investment of this parent concern." The following question was then propounded to him, which he answered as follows: "Q. Well, of course, the parent corporation owns both? A. Yes."
The following question and answer from the testimony of Mr. Lanier Wallen indicates a unity of interest in the business transacted both by the Klamath Falls operation and the Tulelake branch.
"Q. About doing business back and forth over the line, — do you know about that?
A. I know I did all the time; anyway, the salesmen employed here working in this lot; we would go down there and get a car and sell it, or I would drive down *Page 274 
and sell a customer in California; and they would come up and do the same thing here, — their salesmen would come up to our lot and bring customers and sell them cars and they were paid through the office down there. We just worked back and forth; really like having another warehouse where you could draw on stock when you were out away from the firm; I never noticed any distinction. As I say, I sold a number of cars out of their stock which were paid for out of this office, I mean, brought in and showed the stock number on them; paid on their regular check. I never operated out of that business, that particular branch; I went down and sold cars but I always worked out of their Sixth Street lot here in town."
It is also pertinent to remember that the franchise to the Tulelake branch as well as the franchise to the Klamath Falls operation came from an Oregon corporation, namely, the Portland Chevrolet Motor Company of Portland, Oregon, and not from any concern in California.
Tulelake is but six miles from the boundary line between Oregon and California.
By stipulation made in open court during the trial hereof, the following facts are admitted to be true:
That on the 9th day of October, 1939, Marion N. House, while acting within the scope of his employment as manager of the Tulelake, California, branch of the Turner Chevrolet Company, was traveling as a passenger in a motor vehicle being operated by one John Selby near the city of Bend, in the state of Oregon, and while so traveling received injuries through violent, accidental and external means which resulted in his death; that said accident arose out of and in the course of the employment of the said Marion N. House as manager of the Tulelake, California, branch of the *Page 275 
said Turner Chevrolet Company. That said Marion N. House left surviving him Winona House, his wife, plaintiff herein, and Nancy Ann House, a minor daughter of the age of six years. That said Winona House duly filed her application before the State Industrial Accident Commission, which application was denied, and thereafter she filed her application for a rehearing. Following the rehearing, the commission's formal order rejecting said claim was affirmed, and thereafter, claimant regularly appealed to the circuit court of the state of Oregon for the county of Klamath. No question is raised by either party relative to the necessary steps having been taken to present the claim to the circuit court. That said Marion N. House was not employed to work in the state of Oregon, but was in the state incidental to and in pursuance to this employment as manager of the Tulelake, California, branch of the Turner Chevrolet Company. And that insofar as this case is concerned, the statutes of the state of California, or those applicable to the proper determination of this litigation, are to be considered pleaded and proven.
Mrs. House made application for compensation before the State Industrial Accident Commission of the state of California and her application was denied on the ground that the California State Industrial Accident Commission had no jurisdiction. [End of stipulated facts.]
The major question herein is whether the Turner Chevrolet Company was subject to the Oregon Workmen's Compensation Law in its relation to Mr. House whose services admittedly were performed out of the state of Oregon.
To the point that the Oregon Workmen's Compensation Law applies to Oregon occupations only, defendant *Page 276 
cites Spitzer v. "Annette Rolph", et al., 110 Or. 461,218 P. 748, 223 P. 253.
As I understand the holding in that case, it is that the owner of a foreign owned vessel while taking on cargo in this state as part of its interstate business is not subject to the provisions of the Workmen's Compensation Act of Oregon. In the case at bar, the employer is an Oregon corporation transacting its principal business in Oregon.
Defendant also cites Cameron v. Ellis Construction Co. etal., 252 N.Y. 394, 169 N.E. 622. The facts in that case differ from those disclosed here in that the employer was a Massachusetts corporation and the injury to the workman was sustained in Canada, while the claim was made before the Workmen's Compensation Commission of New York; nevertheless, the holding is to the effect that under the New York Workmen's Compensation Act an award may not be made for injuries received in the course of employment at a fixed place outside the state. It is admitted in the case at bar that Mr. House was employed by an Oregon corporation and that his injuries were received, not outside, but within the state of Oregon.
To the point that the Turner Chevrolet Company was not subject to the compensation law of Oregon, for its occupation of operating a garage in California, defendant cites the case ofDurrett v. Eicher-Woodland Lumber Co., Inc., et al., (La. A.) 140 So. 867, 869, 871. In that case, the two industries affected, the Eicher-Woodland Lumber Company and the Sharps "appear to have discontinued operations in Louisiana altogether, and moved to Mississippi, and have never returned to" Louisiana. "This removal had already taken place before plaintiff was employed. Plaintiff *Page 277 
was employed to work in the state of Mississippi for an established industry in that state, and received his injuries while so employed there." The factual situation thus disclosed is different from that which is shown in the instant case.
The case of Middlebusher v. State Industrial AccidentCommission, 147 Or. 459, 34 P.2d 325, is also cited by the commission to the point that workmen, to be protected, must be employees in an occupation covered by the Oregon law. The question here is not whether the character of Mr. House's occupation was within the purview of the Oregon statute, but whether the fact that, during the three months immediately preceding his death, his employment required the principal services he rendered to be performed in California, rendered the Oregon Compensation Act inapplicable.
Thus we are confronted with the question whether the Oregon Workmen's Compensation Act may be given extraterritorial effect.
The only provision of our statute, directly dealing with that subject, provides that —
"If a workman employed to work in this state and subject to this act temporarily leaves the state incidental to such employment and receives an accidental injury arising out of and in the course of his employment, he shall be entitled to the benefits of this act as though he were injured within this state, if at the time of the accident he was not subject to the workmen's compensation law of the jurisdiction in which he was injured. Whenever in any appeal or other litigation the construction of the laws of another jurisdiction shall be required, the courts shall take judicial notice thereof. If any such workman shall file, in the jurisdiction in which he is injured, a claim for an accidental injury and the claim shall be denied for the reason that he was not subject to the workmen's compensation *Page 278 
law of such jurisdiction, he may file a claim for such injury under this act within 60 days after the order denying his claim became final." Vol. 7, O.C.L.A. Sec. 102-1731, p. 652.
It is obvious that the provisions of the foregoing section are not applicable to the facts in the instant case; hence, treating the matter as though no express statutory provision applies thereto, consideration should be given the authorities emanating from other jurisdictions having no provisions concerning the exercise of extraterritorial jurisdiction.
It is an impressive fact that while there are thirteen sister states having no provision for the extraterritorial application of the statute under consideration, in only one of them [Oklahoma] have the courts construed the act to have no extraterritorial application. In one other such jurisdiction [New Mexico] our attention has not been directed to any decision thereupon.
The following named states have given extraterritorial application to the Workmen's Compensation Act, although in none of them is there a statutory provision to that effect: Colorado, Iowa, Louisiana, Minnesota, Montana, New Jersey, New York, Rhode Island, Washington, Wisconsin and Wyoming. Vol. 1, Schneider's Workmen's Compensation Text, (Perm. Ed.) pp. 485-568, Sections 169, 179, 191, 195, 197, 206, 215, 217 and 218.
The Oklahoma court, as stated, gives a contrary construction to the Oklahoma Workmen's Compensation Act. Ibid, p. 537, section 201.
In the case at bar, the contract of employment was an Oregon contract, that is, one entered into in Oregon between residents of Oregon, where the employee was on his way to Portland, Oregon, from Tulelake, California, *Page 279 
in the course of his employment and while traveling in Oregon, met with a fatal accident. It is true that during the three months immediately preceding his demise, the employee was performing services in Tulelake and vicinity in the state of California; but, as we understand the record, the business of his employer at Tulelake in California was incidental to its main business at Klamath Falls in the state of Oregon. That is to say, the main business was at Klamath Falls and the branch business at Tulelake. He was not employed by any one at Tulelake, or elsewhere, than at Klamath Falls, Oregon. He was under the direction and control of the company at Klamath Falls.
The statute provides that —
"If an employer is subject to this act as to any occupation, all workmen employed by him in such occupation shall be subject to this act as workmen, but not otherwise." Vol. 7, O.C.L.A. sec. 102-1728, p. 646.
It is conceded that the Turner Chevrolet Company was subject to the act. There is no restriction in the section quoted requiring the services to be fully and entirely performed in Oregon. Such service as was involved in making the trip to the place of the fatal accident was in part at least performed in Oregon.
While the call to attend the meeting at Portland came from the Portland Chevrolet Motor Company, the purpose, unquestionably, of the meeting was to stimulate business; and two-thirds of the selling by the Tulelake branch being in Oregon and all of the net profits of its business inuring to the parent company at Klamath Falls, the conclusion is inescapable that such parent company would be benefited by the attendance of Mr. House at such meeting. In other words, in that way and to that extent, when the fatal accident *Page 280 
occurred, Mr. House was engaged in a course of employment of benefit to the parent company.
Of the cases brought to my attention, the one having a factual situation most nearly like the one at bar was decided by the appellate division of the supreme court of New York. An application for leave to appeal from that decision was denied by the court of appeals.
The facts of that case were that a workman was employed in New York by a New York company. After working in New York, he was transferred to a western state and began his employment there. He returned to New York to secure his personal effects and a car which he used in his work. While in New York, he was sent with his car to perform some duty as a result of which he was injured. It was held that his case came within the New York Workmen's Compensation Law. Lee v. Oswego Falls Corporation, et al.,249 A.D. 911, 292 N.Y.S. 543. Petition for leave to appeal denied, 274 N.Y. 642.
In New York, it has also been held that where a contract was entered into in New York to be wholly performed in Pennsylvania, the New York act is not applicable. Perlis v. Lederer, 189 A.D. 425,178 N.Y.S. 449.
The following synopsis of the respective holdings in the other states having no provision for the extraterritorial application of the statute in cases wherein the facts were somewhat similar to those in the instant case are worthy of consideration.
New Jersey. Where the contract was made in New Jersey, although the work was to be performed in another state, the statute of New Jersey was held to be controlling. Foley v. Home Rubber Co.,89 N.J.L. 474, 99 A. 624; Rounsaville v. Cent. R. Co., 87 N.J.L. 371, *Page 281 94 A. 392; Id. 90 N.J.L. 176, 101 A. 182; Hi-Heat Gas Co.v. Dickerson, 12 N.J. Misc. 151, 170 A. 44; Frank DesiderioSons, Inc., v. Blunt, 11 N.J. Misc. 494, 167 A. 29; Sweet v.Austin Co., 12 N.J. Misc. 381, 171 A. 684; In re SpencerKellogg  Sons, Inc., 48 F.2d 311.
Rhode Island. In the case of a carpenter employed in Rhode Island where he worked for a time and then was sent to Connecticut to complete the work and was injured there the Rhode Island statute was applied. Grinnell v. Wilkinson, 39 R.I. 447,98 A. 103, L.R.A. 1917B, 767, Ann. Cas. 1918B, 618.
Colorado. It appears that to justify under the Colorado statute, the one essential element is that a substantial portion of the work must be done in the state of Colorado and with this must be combined either an accident in Colorado or a contract in Colorado. United States F.  G. Co. v. Indust. Com.,99 Colo. 280, 61 P.2d 1033.
Iowa. Where an employer had his place of business in Iowa and the injury occurred outside of Iowa, the Iowa court held compensation was recoverable under Iowa law. Pierce v. Bekins V.and S. Co., 185 Iowa 1346, 172 N.W. 191; Cullamore v. Groneweg Schoentgen Co., 219 Iowa 200, 257 N.W. 561; Elk River Coal Lumber Co. v. Funk, 222 Iowa 1222, 271 N.W. 204, 110 A.L.R. 1415.
The right is not impaired by reason of the fact that the employee is engaged in interstate commerce as a truck driver.Towers v. Watson Bros. Transp. Co., Pieart v. same, 229 Iowa 387,  294 N.W. 594.
Louisiana. Where the contract was made in Louisiana for the employee to inspect certain property in a foreign country where he was killed, it was held that *Page 282 
the compensation statute of Louisiana should be given extraterritorial effect because the contract was entered into in the state of Louisiana between residents of the state and relief is sought in the courts of the state. Selser v. Bragmans BluffLumber Co., (La. A) 146 So. 690; McKane v. New AmsterdamCasualty Co. (La. A.) 199 So. 175. See, also, Abood v.Louisiana Oil Refining Corp., (La. A.) 155 So. 484, holding that where the entire service is to be performed in a sister state, even though the contract is entered into in Louisiana, the compensation act of Louisiana is inapplicable; and, calling attention to the fact that the contract considered in Durrett v.Eicher-Woodland Lumber Co., supra, was entered into in Louisiana.
Minnesota. The Minnesota Compensation Act was applied where a traveling salesman lived at and worked out of Mason City, Iowa, while employed by a corporation doing business in Minneapolis.Brameld v. Albert Dickinson Co., 186 Minn. 89, 242 N.W. 465. And in the case of an employee injured in South Dakota, his sales territory, though he reported to a Minneapolis branch office of a Chicago company. Bradtmiller v. Liquid Carbonic Co., 173 Minn. 481,  217 N.W. 680. And in the case of an employee hired in Iowa to work there and then in Minnesota where he was injured.Ginsburg v. Byers, 171 Minn. 366, 214 N.W. 55. And where both employer and employee are residents of the state, the contract of employment is made in the state for the employee to work in Iowa where he was injured. Krekelberg v. Floyd Co., 166 Minn. 149,207 N.W. 193. And in the case of an Ohio corporation, whose northwestern business was "localized" in Minneapolis, out of which branch the employee traveled in North Dakota where he was injured. Stansberry v. Monitor Stove *Page 283 Co., 150 Minn. 1, 183 N.W. 977, 20 A.L.R. 316; State v. Dist.Court, 141 Minn. 348, 170 N.W. 218; State v. Dist. Court,140 Minn. 427, 168 N.W. 177; State v. Dist. Court, 139 Minn. 205,166 N.W. 185, 3 A.L.R. 1347; Severson v. Hanford Tri State AirLines, Inc., 105 F.2d 622.
Montana. The Montana court gave extraterritorial application in a case where both employer and employee resided in Montana, and the employee was hired in Montana. The employee was injured while building a road in Glacier National Park. State ex rel. Loney v.State Ind. Acci. Com., 87 Mont. 191, 286 P. 408.
Washington. The Washington act was held applicable to a case where the employee was in the course of his employment when injured, although at the time of his injury he was in the state of Idaho. The court considered eleven-fourteenths of the employment was in Washington and three-fourteenths in Idaho.
The following is a quotation from the opinion of the supreme court of Washington:
"Any question whether, under the compulsory provisions of the Workmen's Compensation Act, the act applies to workmen employed in this state to do work outside of the state, and who are injured in the course of their employment, is foreclosed by Hilding v. Department of Labor and Industries, 162 Wash. 168,298 P. 321, 322. The question there presented we stated as follows: `Can a widow of a man, resident of, and employed in, this state by an employer coming under the operation of the Workmen's Compensation Act, who is injured outside of the state while engaged in the course of his employment, recover compensation out of the industrial insurance fund?'
We answered that question in the affirmative and said: `The authorities generally hold that, unless the Workmen's Compensation Act expressly provides that it shall have no extraterritorial effect, it applies to *Page 284 
workmen employed in a state to do work outside of the territorial limits of that state.'" Thompson v. Department of Labor andIndustries, 192 Wash. 501, 73 P.2d 1320.
Wisconsin. The Wisconsin court holds that —
"Liability under the Workmen's Compensation Act is, strictly speaking, neither tortious nor contractual in its nature. It is an obligation imposed by law which arises out of the status created by the employment. The liability arises out of the law itself, rather than out of the contract of the parties." * * * "The one essential requisite to liability under the Wisconsin Compensation Act is employment under such circumstances as to create the status of employer and employee under the Wisconsin act. That status arises out of the contract of employment which may be either `express or implied, oral or written'. Subdivision (4) of section 102.07 of the statutes. It may be made by express agreement it may be implied from the performance of service.
That status is created when service is performed, within the state under a contract of hire, without regard to the question of where the contract was made. Such status may also exist where no service is performed in the state in those cases where both the employer and employee are residents of the state when the contract is made." Val Blatz Brewing Co. v. Gerard,201 Wis. 474, 230 N.W. 622.
Wyoming. The act was applied in the case of a truck driver, who was killed in a foreign jurisdiction while in the regular course of his employment for a resident employer. Baldwin v. Byrne,53 Wyo. 519, 86 P.2d 1095.
While Michigan is not nor should it be listed as one of the states having no statutory provision giving extraterritorial effect to its Workmen's Compensation Act, in the case, Leiningerv. Jacobs et al., 270 Mich. 1, *Page 285 257 N.W. 764, the opinion does not suggest that the decision is based upon or affected by a statutory provision. This is a case in which an employer having his principal place of business in Michigan received an application for employment, the applicant being personally present at the principal place of business in Michigan and subsequently by telephoning from Michigan to another state the employer directed his agent to put the applicant to work, which was done, and the work subsequently necessitated the employee coming into the state of Michigan incident to the discharge of his duties and while so engaged in Michigan, the employee sustained injuries arising out of and in the course of his employment which resulted in his death. The supreme court of Michigan held that under such circumstances, the contract was a Michigan contract rather than an Ohio contract, citing Dudley A.Tyng  Co. v. Converse, 180 Mich. 195, 146 N.W. 629. The Michigan court also held that inasmuch as the employee had elected to come under the Michigan compensation act, the employee and his dependents were within the provisions of the act; and that the employer was not relieved from liability by reason of the fact that the employee and his dependents were not domiciled in Michigan, citing Roberts v. I.X.L. Glass Corporation,259 Mich. 644, 244 N.W. 188.
We deem this Michigan case closely analogous to the case at bar.
In referring to it, we are not unmindful that the Michigan statute contains the following provisions:
"Such election" [to become subject to the Workmen's Compensation Act] "on the part of the employers mentioned in subdivision two (2) of the preceding section, shall be made by filing with the industrial *Page 286 
accident board hereinafter provided for, a written statement to the effect that such employer accepts the provisions of this act for all his businesses, and to cover and protect all employes employed in any and all of his businesses, including all businesses in which he may engage and all employes he may employ while he remains under this act." Vol. 2, Compensation Laws of Michigan (1929) p. 3009, Section 8412.
"The term `employe' as used in this act shall be construed to mean: * * * Every person in the service of another, under any contract of hire, express or implied." Ibid, pp. 3010, 3011, Section 8413.
"The industrial accident board shall have jurisdiction over all controversies arising out of injuries suffered without the territorial limits of this state, in those cases where the injured employe is a resident of this state at the time of the injury, and the contract of hire was made in this state, and any such employe or his dependents shall be entitled to the compensation or death benefits provided by this act." Ibid, p. 3042, Section 8458.
It is impressive however that neither in the case of Leiningerv. Jacobs, supra, nor in the case of Roberts v. I.X.L. GlassCorporation, cited therein, was the protection of the act denied because the claimant was not a resident of Michigan. In point of fact, in the Roberts v. I.X.L. Glass Corporation case no services were performed by claimant in Michigan and claimant's injury was received outside the state of Michigan.
Plaintiff-respondent herein applied to the California commission for compensation, but that commission refused to take jurisdiction for the reason that the contract of employment was entered into in the state of Oregon. Such action tends to discredit the contention that Mr. House was protected by the terms of the California compensation act. *Page 287 
A point is urged by defendant herein to the effect that the failure of his employer to make contribution to the Oregon compensation or unemployment fund for Mr. House, or to list him in its report to the Oregon commission as employee, bars plaintiff's claim herein. I think not. Upon a different state of facts, this question was decided contrary to defendant's contention in the case of Lamm v. Silver Falls Timber Co.,133 Or. 468, 277 P. 91, 286 P. 527, 291 P. 375.
After carefully considering the testimony, the admitted facts and the authorities cited herein, I think that the decree and judgment of the circuit court should be affirmed. *Page 288