Court Opinion

ID: 9709987
Source: CourtListenerOpinion
Date Created: 2023-08-26 03:59:03.415282+00
Date Added: 2024-06-11T18:22:53.219967
License: Public Domain

BUCHANAN, Judge,
dissenting.
ISSUE ONE
I cannot agree with the majority's conclusion that the federal Davis-Bacon Act, 40 U.S.C. § 276a, provides a private right of action for wage earners. The majority relies upon McDaniel v. University of Chicago (7th Cir.1977), 548 F.2d 689. cert. denied 434 U.S. 1033, 98 S.Ct. 765, 54 L.Ed.2d 780, to support its conclusion. Decisions since McDaniel, however, demonstrate that there is no private right of action granted by the Davis-Bacon Act.
The court in United States v. Capeletti Bros., Inc. (5th Cir.1980), 621 F.2d 1309, considered the same question as McDaniel, and reached an opposite conclusion. Applying the United States Supreme Court's analysis for determining whether a statute implies a private right of action found in Cort v. Ash (1975), 422 U.S. 66, 95 S.Ct. 2080, 45 L.Ed.2d 26 and Cannon v. Univer*515sity of Chicago (1979), 441 U.S. 677, 99 S.Ct. 1946, 60 L.Ed.2d 560, the Fifth Circuit concluded that the Davis-Bacon Act did not contain an implied private right of action.
The district court in Weber v. Heat Control Co. (D.G.N.J.1982), 579 F.Supp. 346, aff'd (3rd Cir.1984), 728 F.2d 599, in deciding whether to follow McDaniel or Cape letti, concluded that the analysis in Cape-letti, supra, was superior and observed that recent United States Supreme Court and Seventh Circuit decisions cast serious doubt as to the continuing validity of McDaniel.
In Universities Research Ass'n v. Coutu (1981), 450 U.S. 754, 101 S.Ct. 1451, 67 L.Ed.2d 662, the Supreme Court considered whether the Davis-Bacon Act intended to confer to employees a private right of action when there had been an administrative determination that Davis-Bacon work had not been called-for. The Supreme Court concluded that there was no such implied right of action in the Davis-Bacon Act. Although the Supreme Court did not reach the question of whether MceDaniel was correct, the Court opined: "While we recognize that some of our reasoning arguably applies to the question whether the Act creates any implied right of action, we have no reason to reach that broader issue here." Coutu, supra 450 U.S. at 769 n. 19, 101 S.Ct. at 1460 n. 19 (emphasis in original).
The Seventh Circuit, after the Supreme Court rendered its decision in Cannon, supra, determined that §§ 504 and 508(a) of Title V of the Rehabilitation Act of 1973, 29 U.S.C. §§ 794 and 798(a), did not authorize a private right of action. Simpson v. Reynolds Metals Co., Inc. (7th Cir.1980), 629 F.2d 1226. The Seventh Circuit, observing that its analysis in Simpson was different than that used in McDaniel, reflected that the McDaniel decision was made "without the guidance of the Supreme Court's pronouncements in Cannon v. University of Chicago...." - Simpson, supra at 1240 n. 27.
In Cannon, the Supreme Court had clarified the threshold inquiry of Cort, supra, as to whether the plaintiff was a member of the class for whose especial benefit the statute was enacted. The Cannon decision made clear that the question was answerable "by looking to the language of the statute itself...." Cannon, supra 441 U.S. at 689, 99 S.Ct. at 1953.
Thus, the flaw in MeDaniel's analysis is apparent after a close examination of the Court's decision in Coutu. The initial question to be decided in determining whether a statute implies a right of action is whether the plaintiff is one of the class for whose especial benefit the statute was enacted. In McDaniel, the court determined that the Davis-Bacon Act was passed for the special benefit of wage earning construction workers because they were the primary beneficiaries of the act.
In Coutu, supra, the Supreme Court made the same inquiry, but reached a different conclusion. After recognizing that the Davis-Bacon Act was designed for the benefit of construction workers, the Court continued: "But the fact that an enactment is designed to benefit a particular class does not end the inquiry; instead, it must also be asked whether the language of the statute indicates that Congress intended that it be enforced through private litigation." Id. 450 U.S. at 771, 101 S.Ct. at 1461 (emphasis supplied). The Court concluded: |
"'that there 'would be far less reason to infer a private remedy in favor of individual persons' where Congress, rather than drafting the legislation 'with an unmistakable focus on the benefited class,' instead has framed the statute simply as a general prohibition or a command to a federal agency. [Cannon ], [441 U.S.] at 690-692, 99 S.Ct., at 1954-55. Section 1 of the Davis-Bacon Act requires that certain stipulations be placed in federal construction contracts for the benefit of mechanics and laborers, but it does not confer rights directly on those individuals. Since § 1 is simply 'phrased as a directive to federal agencies engaged in the disbursement of public funds," 441 U.S., at 698, n. 14, 99 S.Ct., at 1955, n. 14, *516its language provides no support for the implication of a private remedy."
Coutu, supra 450 U.S. at 772-73, 101 S.Ct. at 1462-63 quoting Cannon, supra 441 U.S. at 690-698, 99 S.Ct. at 1954-1956 (footnote omitted) (emphasis supplied). The analysis of McDaniel was incomplete because the court failed to consider the language of the statute. When the Supreme Court considered the language of the Davis-Bacon Act, it determined there was no implied right of action.
The Supreme Court unquestionably overruled the analysis of McDaniel in Can-mon, and the Seventh Circuit recognized this in Simpson. The Supreme Court impliedly overruled MceDamiel's holding in Coutu when it observed the analysis used in Coutu was applicable to the question considered in MceDaniel. We should conclude that the Davis-Bacon Act does not imply that a private right of action is available to Keith and Wendell. Similarly, we should not use the flawed and obsolete analysis of McDaniel to conclude that the Indiana prevailing wage statutes, Ind.Code 5-16-7-1 to -5 (1990), also confer private causes of action to Keith and Wendell.
IC 5-16-7-8 provides that contractors who violate the act commit class B misdemeanors. IC 5-16-7-1 merely directs the government agencies employing the contractors to require the contractor to pay the statute's prevailing wage, just as the Davis-Bacon Act directs federal agencies to require contractors to pay the prevailing wage. Using the United States Supreme Court's analysis in Coutu, Cannon, and Cort, it is clear that our legislature did not intend to confer a private right of action to wage earners. This conclusion is supported by the existence of a criminal penalty for a violation of the act. See Cort, supra.
In light of Cannon and Coutu, the majority's reliance on McDaniel is a slender reed which collapses under the weight of all the federal cases on this subject. There are no Indiana cases.
ISSUE TWO
My disagreement with the majority's holding extends to issue two. The evidence demonstrates that Keith settled his claim against Stampeo, and he should be held to his bargain.
While I would agree that an employee's right to receive prevailing wages cannot be waived by an employment contract, I do not agree with the majority's conclusion: "Because we have found an employee cannot waive the benefits of the prevailing wage statutes by an employment agreement to lower compensation, we also find an employee cannot release his right to receive prevailing wages." At 518 (emphasis supplied).
The record demonstrates that Keith did not release his "right to receive" prevailing wages, but rather, he released his claim for not having received prevailing wages. Keith executed his released on October 80, 1985, after his employment with Stampeo had been terminated. The release provided:
"OCTOBER 830 1985
WAGE SCALE AFFIDAVIT:
I WENDLE [sic]} KEITH GUFFY [sic] release STAMPCO - CONSTRUCTION INC. from the scale of minimum wages established on all projects pursuant to minimum wages established by Chapter 319, Acts of the General Assembly, 1985. All said scale of prevailing wages Rave been paid including any and all overtime on all projects that I have worked on and was employed by STAMPCO CONSTRUCTION INC.
This wage scale affidavit also releases Everett Stamper from any and all claims for prevailing wages and any overtime as stated above and I have been paid in full.
/s/ W. Keith Guffey Wendle [sic] Keith Guffy [sic]"
Record at 258 (emphasis supplied).
So the majority's characterization of the release as a release of Keith's right to receive prevailing wages is inaccurate. Keith executed the release in exchange for $2000, including a $500 cash payment and a promise to pay $1500. Record at 251. The *517release was executed after Keith's employment had been terminated and after any right of action would have acerued. Keith did not have a "right to receive" prevailing wages because he was no longer employed. There is no known public policy precluding litigants from settling their claims. Keith entered into a negotiated settlement.
A release is a surrender of a claimant's right to prosecute a cause of action. Lechner v. Reutepohler (1989), Ind.App., 545 N.E.2d 1144. As our supreme court recognized in Indiana Bell Tel. Co. v. Mygrant (1984), Ind., 471 N.E.2d 660:
"[Releasees] do not make settlement and take general releases merely to pay the releasor the first installment on what he should have, leaving the matter open for the releasor to come back for more if his injuries prove serious. On the contrary, a settlement is made and a general release taken for the purpose of foreclosing further claims. The releasee does not stand in a fiduciary relationship to the releasor. The injured party is not required to make a settlement, and the general rule of freedom of contract includes the freedom to make a bad bargain."
Id. at 664, quoting Sanger v. Yellow Cab Co., Inc. (1972), Mo., 486 S.W.2d 477, 481-82.
Thus, there is no legal basis for denying Keith the right to settle any prevailing wage claims he might have had. The wisdom of Keith's decision to release any prevailing wage claim he might have had in exchange for the consideration he received is irrelevant to our determination. The majority's wholesale, conclusory determination that claims for prevailing wages cannot be settled is unsupportable in my opinion.
The trial court's judgment should be reversed.