Court Opinion

ID: 6847152
Source: CourtListenerOpinion
Date Created: 2022-07-23 20:30:42.940567+00
Date Added: 2024-06-11T16:05:00.045180
License: Public Domain

WILSON, Circuit Judge
(dissenting).
I cannot agree to the majority opinion that a Vermont contract of employment, both parties to which were domiciled in Vermont and accepted its Workmen’s Compensation Act, will not be recognized as valid by this court, because it is against the public policy of New Hampshire where an injury occurred, on the ground that, it undertakes to relieve an employer from liability for future negligence. The case is one of new impression, and, owing to the peculiar nature of the New Hampshire Employers’ Liability and Compensation Act, is unique in the issues it presents, and of importance to employers, especially in adjoining states; otherwise I should not deem it necessary to present my views at length.
The only doubtful question, as I view the ease, is the issue presented by the fact that the defendant had also accepted the New Hampshire Compensation Aet, chapter 178, Pub. Laws 1926, and complied with section 4. It is not really contended, however, that this was done because of the fact that some of its workmen living and employed in Vermont were also sent into New Hampshire to do service work, as it also appears that, by reason of the extension of its lines into New Hampshire, it was at times, if not continually, obliged to employ residents of that state..
*1001Unless the fact that the defendant invoked and defended under the New Hampshire Employers’ Liability and Compensation Act, after the trial judge ruled that the Vermont contract would not be recognized in New Hampshire, must be construed as an assent that the New Hampshire statutes should alone govern the rights of the plaintiff’s intestate in this ease, the parties stand as though the Employers’ Liability and Compensation Act of New Hampshire did not exist. The plaintiff brings its action under New Hampshire’s Lord Campbell Act, and the defendant retains all its defenses at common law.
There was no new employment in New Hampshire of the deceased. There was no acceptance of the New Hampshire act by the deceased or his representative. By commencing an action under New Hampshire’s death statute (Pub. Laws 1926, e. 302, §§ 9-14), his administratrix is by section 12 of its Compensation Act expressly barred from all benefits under the act.
If the defendant, by accepting the act, assented to the deceased, under the circumstances of this case, taking advantage of any benefits of compensation the act gives, did not the representative of the deceased by rejecting it and bringing her action under another statute consent to be subject to all defenses the act gives the defendant, and also to any defense the defendant had under the principles of comity?
The acceptance of the Compensation Act of New Hampshire does not confer on an employee injured in that state the right to sue at common law or on his representative in case of death to bring an action under its death statute; it merely does not take it away, unless it is voluntarily surrendered up by the acceptance of the Act after the injury. As the plaintiff saw fit to institute a suit under another New Hampshire statute, the acceptance of the New Hampshire Compensation Act by the defendant should not be construed as a waiver of any legitimate defense to the suit the defendant might have under the established rules of comity by virtue of a valid contract it had with the deceased.
However, I desire particularly to go on record as opposed to the ruling of the majority opinion that New Hampshire will not recognize a contract of employment under a Workmen’s Compensation Act of another state that requires the assent of the workman before an injury to entitle him to its benefits, on the ground that it is contrary to the pub-lie policy of New Hampshire. The New Hampshire court has never so declared, and we cannot conceive of any court holding that a statute so generally held to be conceived in the interest of the workingman was inconsistent with the welfare of the citizens of New Hampshire. See Mulhall v. Mfg. Co., 80 N. H. 194, 115 A. 449.
The case of Saloshin, Adm’x, v. Houle, recently decided by the New Hampshire Supreme Court, does not so hold. That was a case where the injury occurred through the negligence of a third party in .New Hampshire, and the deceased, a resident of New York, had accepted the New York Compensation Act (Consol. Laws c. 67), and his representative and widow was receiving compensation under it. She brought an action against the third party in New Hampshire.
By the provisions of the New York act, however, the claim of an employee against a third party, in case he accepts compensation, is assigned to the insurer, or the party paying the compensation. The insurer asked to be joined in the action in New Hampshire. There seems to have been some question as to whether the decedent had received or would receive, if allowed to prosecute the action for her own benefit, damages that might belong to other beneficiaries under the provisions of the New Hampshire death statute. The New Hampshire court merely held that, in an action in New Hampshire, a New York statute that differed from its own did not control as to damages. It is significant, however, so far as it has any bearing on the case now at bar, that the New Hampshire court, upon the principles of comity, did recognize the provision of the New York statute that assigned the employee’s rights against the third party to the insurer and held the action was maintainable in the administratrix’ name for the benefit of the insured, notwithstanding the right arose under a compensation act of another state, which leaves no option on the part of the employee to reject it after the injury occurred.
Whether a contract similar to that of Vermont would be valid if entered into in New Hampshire under its present statutes is not material, as appears from Smith v. Godfrey, infra, 28 N. H. 379, 61 Am. Dec. 617, and the eases hereinafter cited. It is conceded that it is a valid contract in Vermont, and by its terms the deceased agreed that his remedy under the Compensation Act of Vermont, in case of injury either in Vermont or New Hampshire, was an exclusive remedy.
*1002It is true that contracts for relief against future negligence in this country are held void as against public policy; but a contract for adequate compensation in ease of injury by accident, whether due to negligence of either employer or employee, or occurring without the negligence of either, is quite dif - ferent from a contract under which an employee receives no benefit, but relieves the employer from all liability for future negligence. In the one case, 'it is held to be a contract in the interest of the workman, and, in the other, that it is so hostile to his interest and so conducive to neglect on the part of the employer to provide the ordinary provisions of safety for its employees, that it is, so far as we know, upheld by no court in this country.
The Massachusetts court, however, has repeatedly held that a contract exempting one party from liability from future negligence, if valid where made, as in England, though contrary to the publie policy of Massachusetts and would be void if made there, is not immoral or illegal, and will be enforced in that commonwealth. Fonseca v. Cunard Steamship Line, 153 Mass. 553, 557, 27 N. E. 665, 12 L. R. A. 340, 25 Am. St. Rep. 660 ; O’Regan v. Cunard Steamship Line, 160 Mass. 356, 361, 35 N. E. 1070, 1071, 39 Am. St. Rep. 484; Stone v. Old Colony St. Railway, 212 Mass. 459, 464, 99 N. E. 218; Mittenthal v. Mascagni, 183 Mass. 19, 66 N. E. 425, 60 L. R. A. 812, 97 Am. St. Rep. 404. The word “illegal” is evidently here used in the sense of prohibited by express statute.
The limits of the concept “public policy,” is not easily defined. Mr. G-reenhood in his work on Publie Policy gives this brief summary of the law, which is well supported by the authorities: “When a contract is valid under the publie policy of the state where made, it will be enforced in another state, although the same would by the statute laws of the latter state be void, unless its enforcement would exhibit to the citizens of the state ■an example pernicious and detestable.”
Again: “The law of one state having ex proprio vigore no validity in another state, the enforcement of a foreign contract which would not be valid by the law of the forum where its enforcement is judicially attempted, depends upon comity which is extended for that purpose, unless the agreement is contrary to the publie policy of the state of the forum in that it is contrary to good morals, or the state or its citizens would be injured by its enforcement or it perniciously violates positive, written or unwritten prohibitory law.” (Italics supplied.)
In other words, every contract, unless held to be contrary to good morals, and the welfare of its citizens, should be enforced in another state than the state of its inception, under the well-established principles of comity, even though prohibited by the law of the forum.
This rule is recognized in New Hampshire in Smith v. Godfrey, 28 N. H. 379, 61 Am. Dec. 617, the leading New Hampshire ease, in which “A sol(l and delivered spirituous liquors to B in Massachusetts, and such sale was there legal. Upon -an action brought for the price in New Hampshire, where such sales are illegal, it was held that the bare knowledge on the part of the vendor that the purchaser intended to sell them in New Hampshire contrary to law, was not a defence to the action and the plaintiff could recover the price.” This case was followed in Hill v. Spear, 50 N. H. 253, 9 Am. Rep. 205; MacDonald v. Railway, 71 N. H. 448, 450, 52 A. 982, 59 L. R. A. 448, 93 Am. St. Rep. 550.
The court held further in Smith v. God-frey, that, while no state or nation is bound to recognize or enforce any contracts which are injurious to its own interests or to those of its citizens, “it is a well established general principle that the validity of a contract is to be determined by the law of the place where the contract is made.”
In Milliken v. Pratt, 125 Mass. 374, 375, 28 Am. Rep. 241, the Massachusetts court said: “The general rule is that the validity of a contract is to be determined by the law of the state in which it is made; if it is valid there, it is deemed valid everywhere, and will sustain an action in the courts of a' state whose laws do not permit such a contract. Scudder v. Union National Bank, 91 U. S. 406 [23 L. Ed. 245]. Even a contract expressly prohibited by the statutes of the state in which the suit is brought, if not in itself immoral, is not necessarily nor usually deemed so invalid that the comity of the state, as administered by its courts, will refuse to entertain an action on such-a contract made by one of its own citizens abroad in a state the laws of which permit it. Greenwood v. Curtis, 6 Mass. 358 [4 Am. Dec. 145]; McIntyre v. Parks, 3 Metc. 207.” (Italics supplied.)
In O’Regan v. Cunard Steamship Line, supra, the same court said: “Although the stipulation relieving the defendant from lia*1003bility for injuries resulting from the negligence of its servants is against the policy of our law, it is not immoral or illegal; and, it being valid in Great Britain, where it was made, it will be enforced on principles of comity by our courts.”
The mere fact that statutes of different states, of the same general character, differ in some feature, does not render a contract entered into in one state and valid under its statute, unenforceable in another state because it does not conform to its statute. Swann v. Swann (C. C.) 21 F. 299, 306; Reynolds v. Day, 79 Wash. 499, 502, 140 P. 681, L. R. A. 1916A, 432; Herrick v. Minneapolis & St. L. R. Co., 31 Minn. 11, 16 N. W. 413, 47 Am. Rep. 771; Northern Pac. v. Babcock, 154 U. S. 190, 14 S. Ct. 978, 38 L. Ed. 958; Chicago & E. I. R. Co. v. Rouse, 178 Ill. 132, 52 N. E. 951, 44 L. R. A. 410; Higgins v. Central N. E. & W. R. Co., 155 Mass. 176, 180, 29 N. E. 534, 31 Am. St. Rep. 544; Dennick v. R. R. Co., 103 U. S. 11, 26 L. Ed. 439; Barnhart v. Am. Concrete Steel Co., 227 N. Y. 531, 125 N. E. 675 ; Schweitzer v. Hamburg-Amerikanische Line, 78 Misc. Rep. 448, 138 N. Y. S. 944; Howard v. Howard, 200 N. C. 574, 158 S. E. 101, decided April 1, 1931; Bliss v. Houghton, 16 N. H. 90, 91, 92; Adams v. Gay, 19 Vt. 358, 367 ; 2 Kent, 117, 118.
The eases cited by counsel for appellee of Am. Mut. Liability Co. v. McCaffrey et al. (C. C. A.) 37 F.(2d) 870, Johns-Manville Inc., v. Thrane, 80 Ind. App. 432, 141 N. E. 229, and Carl Hagenback & Wallace Show Co. v. Randall, 75 Ind. App. 417, 126 N. E. 501, have no bearing on this case. In the first two the employee was employed solely to do work in the state where the accident occurred, and it was held that he was subject to the Compensation Law of that state. In the last case the appellant was an Indiana corporation. The appellee was employed to work in any state. He made a contract in Ohio by which he agreed that, if injured, his rights were to be controlled by the laws of the District of Columbia. At the time of his injury he was being employed in Indiana, the domicle and place of business of the appellant, and the rights of the parties under these conditions were held to be governed by the law of Indiana.
Here the deceased was employed to work in Vermont where the domicile and main business of his company was, and incidentally in New Hampshire. In such ease the rule has now become generally established to hold the employee subject to the law of the state where his employment was entered into. Pettiti v. Pardy Cons. Co., 103 Conn. 101, 109, 130 A. 70 ; Minto v. Hitchings, 204 App. Div. 661, 198 N. Y. S. 610; Schweitzer v. Hamburg-Amerikanische Line, supra; Norman v. Hartman Furniture Co., 84 Ind. App. 173, 150 N. E. 416.
I am firmly of the opinion that there is nothing in the contract entered into between these parties in Vermont that is contrary to the purpose of the New Hampshire Compensation Act as defined by the court of that state in Mulhall v. Nashua Mfg. Co., 80 N. H. 194, 115 A. 449, or inimical to the welfare of its citizens and the public policy of that state; and, according to the trend of decisions in other jurisdictions, the rights of the parties should have been held to be governed by the Vermont contract, which provided for the plaintiff’s only and exclusive relief for the death of her intestate.
If the employee or his representative had also accepted the New Hampshire act and sought to enforce his rights under that act, the New Hampshire courts, in accordance with the most recent decisions, would have refused to award compensation under the New Hampshire act and referred her back to Vermont where his contract of employment was made. Pettiti v. Pardy Construction Co., 103 Conn. 101, 109, 130 A. 70; Minto v. Hitchings, 204 App. Div. 661, 198 N. Y. S. 610; Schweitzer v. Hamburg-Amerikanische Line, 78 Misc. Rep. 448, 138 N. Y. S. 944; Barnhart v. Am. Concrete Steel Co., 227 N. Y. 531, 125 N. E. 675; Norman v. Hartman Furniture Co., 84 Ind. App. 173, 150 N. E. 416.
Bradbury in the third edition of his work on Compensation Law, page 88, after reviewing the results of the administration of the law for two decades, says: “It would seem that the application of the doctrine that the parties should be governed by the Workmen’s Compensation Law of the state where the contract of employment was made, would settle very many of the difficulties which are bound to arise, and any other doctrine would multiply these difficulties.”
The recognition of the Vermont contract in this case does not interfere with the sovereign powers of New Hampshire, or extend the laws of Vermont into New Hampshire, any more than does the recognition and enforcement in New Hampshire of a contract entered into in another state and valid there, though not valid under the laws of New *1004Hampshire. See Smith v. Godfrey, supra; Hill v. Spear, supra.
Neither does the clause in a majority of the Compensation Acts in the different states expressly giving the law extraterritorial effect project the law of the enacting state into another state in defiance of its laws or its sovereignty. It merely provides that, in ease of injury in another state, íh-e state where the contract was entered into will allow compensation, though the accident occurred beyond its jurisdiction. In other words, the contract for compensation is as broad as the contract of employment.