MAGNOLIA PETROLEUM CO. v. HUNT
No. 29
Supreme Court of the United States
Submitted October 20, 1943. Decided December 20, 1943.
320 U.S. 430
Affirmed.
MR. JUSTICE ROBERTS and MR. JUSTICE JACKSON took no part in the consideration or decision of this case.
Sullivan H. Hunt, pro se.
The question for decision is whether, under the full faith and credit clause,
Magnolia Petroleum Company, petitioner here, employed respondent in Louisiana as a laborer in connection with the drilling of oil wells. In the course of his employment respondent, a Louisiana resident, went from Louisiana to Texas, and while working there for petitioner on an oil well, he was injured by a falling drill stem. He sought and procured in Texas an award of compensation for his injury under its Workmen‘s Compensation Law,1 and petitioner‘s insurer made payments of compen-
Respondent then brought the present proceeding in the Louisiana District Court to recover compensation for his injury under the Louisiana Workmen‘s Compensation Law.3 Petitioner filed exceptions to respondent‘s petition
In Texas a compensation award against the employer‘s insurer (with exceptions not here applicable, cf.
It does not appear, nor is it contended, that Louisiana more than Texas allows in its own courts a second recovery of compensation for a single injury. The contention is that since Louisiana is better satisfied with the measure of recovery allowed by its own laws, it may deny full faith and credit to the Texas award, which respondent has procured by his election to pursue his remedy in that state. In thus refusing, on the basis of state law and policy, to give effect to the Texas award as a final adjudication of respondent‘s claim for compensation for his injury suffered in Texas, the Louisiana court ignored the distinction, long recognized and applied by this Court, and recently emphasized in Williams v. North Carolina, supra, 294-296, between the faith and credit required to be given to judgments and that to which local common and statutory law is entitled under the Constitution and laws of the United States.
In the case of local law, since each of the states of the Union has constitutional authority to make its own law with respect to persons and events within its borders, the full faith and credit clause does not ordinarily require it to substitute for its own law the conflicting law of another state, even though that law is of controlling force in the
But it does not follow that the employee who has sought and recovered an award of compensation in either state may then have recourse to the laws and courts of the other to recover a second or additional award for the same injury. Where a court must make choice of one of two conflicting statutes of different states and apply it to a cause of action which has not been previously litigated, there can be no plea of res judicata. But when the employee who has recovered compensation for his injury in one state seeks a second recovery in another he may be met by the plea that full faith and credit requires that his demand, which has become res judicata in one state, must be recognized as such in every other.
The full faith and credit clause and the Act of Congress implementing it have, for most purposes, placed a judgment on a different footing from a statute of one state, judicial recognition of which is sought in another.
From the beginning this Court has held that these provisions have made that which has been adjudicated in one state res judicata to the same extent in every other. Hampton v. McConnell, 3 Wheat. 234, 235; Christmas v. Russell, 5 Wall. 290; Fauntleroy v. Lum, 210 U. S. 230; Kenney v. Supreme Lodge, 252 U. S. 411; Milwaukee County v. White Co., 296 U. S. 268; Davis v. Davis, 305 U. S. 32, 40; Titus v. Wallick, 306 U. S. 282, 291-292; Williams v. North Carolina, supra. Even though we assume for present purposes that the command of the Constitution and the statute is not all-embracing, and that there may be exceptional cases in which the judgment of one state may not override the laws and policy of another,4 this Court is the final arbiter of the extent of the exceptions. Alaska Packers Assn. v. Industrial Accident Comm‘n, supra, 547; Titus v. Wallick, supra, 291. And we pointed out in Williams v. North Carolina, supra, 294-295, that “the actual exceptions have been few and far between. . . .”
We are aware of no such exception in the case of a money judgment rendered in a civil suit. Nor are we aware of any considerations of local policy or law which could rightly be deemed to impair the force and effect which the full faith and credit clause and the Act of Congress require to be given to such a judgment outside the state of its rendition. Milwaukee County v. White Co., supra, 277, 278.
These consequences flow from the clear purpose of the full faith and credit clause to establish throughout the federal system the salutary principle of the common law that a litigation once pursued to judgment shall be as conclusive of the rights of the parties in every other court as in that where the judgment was rendered, so that a cause of action merged in a judgment in one state is likewise merged in every other. The full faith and credit clause like the commerce clause thus became a nationally unifying force. It altered the status of the several states as independent foreign sovereignties, each free to ignore rights and obligations created under the laws or established by the judicial proceedings of the others, by making each an integral part of a single nation, in which rights judicially established in any part are given nation-wide application. Milwaukee County v. White Co., supra, 276, 277; Williams v. North Carolina, supra, 295. Because there is a full faith and credit clause a defendant
Here both Texas and Louisiana have undertaken to adjudicate the rights of the same parties arising from a single injury sustained in the course of employment under the same contract. Each state has awarded to respondent compensation for that injury. But whether the Texas award purported also to adjudicate the rights and duties of the parties under the Louisiana law or to control persons and courts in Louisiana is irrelevant to our present inquiry. For Texas is without power to give extraterritorial effect to its laws. See New York Life Insurance Co. v. Head, 234 U. S. 149; Home Insurance Co. v. Dick, 281 U. S. 397. The significant question in this case is whether the full faith and credit clause has deprived Louisiana of the power to deny that the Texas award has the same binding effect on the parties in Louisiana as it has in Texas.
It is not, as the state court thought, a sufficient answer to the bar of the Texas award to assert that Louisiana has a recognized interest in awarding compensation to Louisiana employees who are injured out of the state, see Alaska Packers Assn. v. Industrial Accident Comm‘n, supra, for Texas, the state in which the injury occurred, has a like interest in making an award, see Pacific Employers Ins. Co. v. Industrial Accident Comm‘n, supra. And in each of the cases we have cited, the state to which the judgment was brought had an interest in the subject matter of the suit and a public policy contrary to that of the state in which the judgment was obtained. No convincing reason is advanced for saying that Louisiana has a greater interest in awarding compensation for an injury suffered in an industrial accident, than North Carolina had in
In each of these cases the words and purpose of the full faith and credit clause were thought to demand that the interest of the state in which the judgment was obtained and was res judicata, should override the laws and policy of the forum to which the judgment was taken. And we can perceive no tenable ground for saying that a compensation award need not be given the same effect as res judicata in another state as it has in the state where rendered.5
It lends no support to the decision of the Louisiana court in this case to say that Louisiana has chosen to be more generous with an employee than Texas has. Indeed no constitutional question would be presented if Louisiana chose to be generous to the employee out of the general funds in its Treasury. But here it is petitioner who is required to provide further payments to respondent, contrary to the terms of the Texas award, which, if the full faith and credit clause is to be given any effect, was a conclusive determination between the parties that petitioner should be liable for no more than the amount of the Texas award. For this reason it is not enough to say that a practical reconciliation of the interests of Texas and Louisiana has been effected by the Louisiana court. There has been no reconciliation of the liability established by the Louisiana judgment with the rights conferred on petitioner by the Texas award and the full faith and credit clause.
Whether the proceeding before the State Industrial Accident Board in Texas be regarded as a “judicial proceeding,” or its award is a “record” within the meaning of the full faith and credit clause and the Act of Congress, the result is the same. For judicial proceedings and records of the state are both required to have “such faith and credit given to them in every court within the United States as they have by law or usage in the courts of the State from which they are taken.”
The decision of the state court is not supported by the suggestion that the Texas award is not res judicata in Louisiana because respondent‘s suit there was on a different cause of action. When a state court refuses credit to the judgment of a sister state because of its opinion of the nature of the cause of action or the judgment in which it is merged, an asserted federal right is denied and the sufficiency of the grounds of denial are for this Court to decide. Titus v. Wallick, supra, 291 and cases cited; and see Adam v. Saenger, 303 U. S. 59, 64 and cases cited. Respondent‘s injury in Texas did not give rise to two causes of action merely because recovery in each state is
The suggestion that there is a second and different cause of action in Louisiana, merely because Louisiana law authorizes compensation, and in a different measure than does Texas, or because the jurisdiction of the court of one state depends on the place of the injury and that of the other on the place of the employment contract, would if accepted prove too much. Apart from the demands of full faith and credit, recovery in a transitory action for injury
If an employee employed in one state but injured in another has a different cause of action for compensation in each state because each has its own compensation statute, it could as well be argued in any case where plaintiff has recovered a judgment in one state, and seeks a second recovery in a second state for the same injury, that he is suing upon a second and different cause of action. But it has never been thought that an actionable personal injury gives rise to as many causes of action as there are states whose laws will permit a suit to recover for the injury or that despite the full faith and credit clause the injured person, more than one entitled to recover for breach of contract, could go from state to state to recover in each damages or compensation for his injury. A judgment in tort or in contract is not immune from the requirement of full faith and credit because the successful plaintiff could have maintained his suit under the law of other states and have secured a larger recovery in some, or because the jurisdiction of the court in one state to hear the cause may depend upon some facts different from the facts necessary to sustain the jurisdiction in another. Cf. Baltimore Steamship Co. v. Phillips, supra; Eldred v. Bank, 17 Wall. 545;
Reversed.
By MR. JUSTICE JACKSON:
I concur with the opinion of the CHIEF JUSTICE.
If the Court were to reconsider Williams v. North Carolina, 317 U. S. 287, in the light of the views expressed by MR. JUSTICE BLACK, I should adhere to the views I expressed in dissent there. Until we do so, I consider myself bound by that decision. Whatever might be the law if that case had never been decided, I am unable to see why the controlling principles it announced under the full faith and credit clause to reverse the North Carolina decision therein do not require reversal of the Louisiana decision under review. I agree with the dissent that Louisiana has a legitimate interest to protect in the subject matter of this litigation, but so did North Carolina in the Williams case. I am unable to see how Louisiana can be constitutionally free to apply its own workmen‘s compensation law to its citizens despite a previous adjudication in another state if North Carolina was not free to apply its own matrimonial policy to its own citizens after judgment on the subject in Nevada. Is Louisiana‘s social interest in seeing that its labor contracts carry adequate workmen‘s compensation superior constitutionally to North Carolina‘s interest in seeing that people who contract marriage there are protected in the rights they acquire? It is true that someone might have to take care of the Louisiana citizen who is injured but inadequately compensated in Texas, as it was true in the Williams case that someone might have to care for those deprived of their marriage status by the foreign divorce decree.
MR. JUSTICE DOUGLAS, dissenting:
While I have joined in the opinion of MR. JUSTICE BLACK, certain observations in the concurring opinion lead me to add a few words.
I do not agree with the view that the full faith and credit clause is to be enforced “only if the outcome pleases us.” We are dealing here with highly controversial subjects where honest differences of opinion are almost certain to occur. Each case involves a clash between the policies of two sovereign States. The question is not which policy we prefer; it is whether the two conflicting policies can somehow be accommodated. The command of the full faith and credit clause frequently makes a reconciliation of the two interests impossible. One must give way in the larger interest of the federal union. The question in each case is whether as a practical matter there is room for adjustment, consistent with the requirements of full faith and credit. Williams v. North Carolina, 317 U. S. 287, is a recent example. One domiciled in Nevada was granted a divorce from his North Carolina spouse on notice by publication. The question for us was whether that decree was a defense to a prosecution for bigamy in North Carolina. Such questions of status, i. e., marital capacity, involve conflicts between the policies of two States which are quite irreconcilable as compared with the present situation.
If the claim under the Texas Act had been denied because of statutory defenses accorded the employer, I do not
The principle of the Troxell case seems apposite here since the claim in Texas was only one for “compensation under the Employers Liability Act” of that State. And the Texas award purported to do no more than to adjudicate rights and duties under the Texas Act. For it provided that when fully paid it would discharge the insurer “from all liability by reason of this claim for compensation.” If the Texas award had undertaken to adjudicate the rights and duties of the parties under the Louisiana contract of employment, which we are told carries the right to compensation under the Louisiana Act (10 So. 2d 109, 112), the result would be quite different. Then the judgment, like the divorce decree in the Williams case, would undertake to regulate the relationship of the parties, or their rights and duties which flow from it, as respects their undertakings in another State. And since Texas would have had jurisdiction over the parties its
Under the circumstances disclosed the situation is thus quite different from the usual transitory action or from a decree which undertakes to sever marital bonds between one domiciled in a state and a non-resident. But even if the Texas award were less clear than I think it is, I would resolve all doubts against an inference that rights under the Louisiana contract were adjudicated in Texas. Such a course seems to me essential so that the greatest possible accommodations of the interests of the two States, consistent with the requirements of full faith and credit, may be had whether the matter be divorce, workmen‘s compensation or any other subject on which state policies differ.
On its face Yarborough v. Yarborough, 290 U. S. 202, might seem to look the other way. There a Georgia decree of permanent alimony for a child was held to be entitled to full faith and credit in South Carolina where the child subsequently sought additional allowances. But the Georgia decree was more clearly an adjudication of the aggregate liability of the defendant than was the Texas award in the present case, for it relieved the father on compliance with its provisions of “all payments of alimony.” 290 U. S. p. 207. Moreover, the father was not a resident of South Carolina but had long been domiciled in Georgia. The Court specifically reserved the question whether the Georgia decree would be entitled to full faith and credit as a final discharge of the duty to support had the father been domiciled in South Carolina. 290 U. S.
p. 213. Here the Texas award is not only a limited one. The employee is domiciled in Louisiana, the employer is authorized to do business in Louisiana. The employment contract is a Louisiana contract. Louisiana has such a considerable interest at stake that I would allow its policy to be obliterated or subordinated only in case what took place in Texas is irreconcilable with what Louisiana now seeks to do. I do not think it is.
It is thus apparent that the decision of Williams v. North Carolina is no shelter in the present controversy.
MR. JUSTICE MURPHY joins in this dissent.
MR. JUSTICE BLACK, dissenting:
The respondent Hunt is a resident of Louisiana, employed in that state by the petitioner and sent by the petitioner to do work in Texas. While in Texas he was seriously injured in the course of his employment. Confined to a hospital he was told that he could not recover compensation unless he signed two forms presented to him. As found by the Louisiana trial judge there was printed on each of the forms “in small type” the designation “Industrial Accident Board, Austin, Texas.” To get his compensation Hunt signed the forms and the Texas insurer began to pay. Returning to his home in Louisiana Hunt apparently discovered that his interests would be more fully protected under Louisiana law and notified the insurer of an intention to claim under the statute of that state. The insurer immediately stopped payment to him and notified the Texas Board to that effect. Four days later, without any request from Hunt, the Board notified him at his Louisiana home that a hearing would be held in Texas within two and a half weeks “to determine the liability of the insurance company” under Texas law. Hunt did not participate in that proceeding. The Texas Board thereafter made an award to him which, under the
The employer has contended here that the Texas award against the insurer was a judgment which under the full faith and credit clause precluded the employee from any further relief in the courts of Louisiana. The Court today agrees with the employer, holding that while in “exceptional cases . . . the judgment of one state may not override the laws and policy of another, this Court is the final arbiter of the extent of the exceptions.” The Court declines to recognize an exception in the case now before us, buttressing its conclusion with a contention that the case of Chicago, R. I. & P. Ry. Co. v. Schendel, 270 U. S. 611, requires such a result.
I disagree. As I see it, this case properly involves two separate legal questions: (1) Did Texas intend the award of its Industrial Accident Board against the insurer to bar the right granted the employee by the Louisiana Workmen‘s Compensation Law to collect from his employer for the same injury the difference between the compensation allowed by Texas and the more generous compensation allowed by Louisiana? (2) Assuming the Texas award was intended to constitute such a bar, does the interest of Louisiana in regulating the employment contracts of its residents nevertheless permit it to grant that larger measure of compensation which as a matter of local policy it believes necessary? The decision of the Court on both of these issues appears to me to be wrong.
I.
Where a state court refuses to recognize the judgment of a sister state as a bar to an asserted cause of action, the full faith and credit clause cannot raise a federal question unless the judgment would have been a bar to a similar suit in that sister state.
The general rule of res judicata announced by Texas courts is that a judgment on the merits constitutes “a finality as to the claim or demand in controversy, concluding parties and those in privity with them . . . as to every matter which was offered and received to sustain or defeat the claim or demand, [and] as to any other admissible matter which might have been offered for that purpose.” Rio Bravo Oil Co. v. Hebert, 130 Tex. 1, 8, 9, 106 S. W. 2d 242, 246. The opinion of Section A of the Texas Commission of Appeals in Ocean Accident & Guarantee Corp. v. Pruitt, 58 S. W. 2d 41, 44-45, relied upon by the Court, presents an application of this rule to Texas workmen‘s compensation awards. There it was held that an employee who had been denied a compensation award by
The statutes of Texas lend support to the view that the Accident Board‘s award was not intended to bar the employee‘s rights against his employer arising under the law of Louisiana. Under the Texas statutes an award of the Accident Board neither adds to nor subtracts from an employer‘s liability to an injured employee. That liability is fixed, not by an award, but by a tripartite contract implied by the Texas statute between the employer, the employee, and the insurer, under which the employee
to by the Court, pertains to the rights of a Texas workman who was injured in Pennsylvania.
In the absence of compelling language this Court should not construe the statutes of Texas in such a manner that grave questions of their constitutionality are raised. Cf. Yarborough v. Yarborough, supra, 213, 214. It is extremely doubtful whether Texas has the power, by any legal device, to preclude a sister state from granting to its own residents employed within its own borders that measure of compensation for occupational injuries which it deems advisable. “A state can legislate only with reference to its own jurisdiction; and the full faith and credit clause does not require the enforcement of every right which has ripened into a judgment of another state or has been conferred by its statutes.” Broderick v. Rosner, 294 U. S. 629, 642. The practical result of the decision here is to hold that Texas has power to nullify a Louisiana statute which gives the beneficial protection of workmen‘s compensation to an injured workman who is a resident of Louisiana and made his contract of employment there. I “am not persuaded that the full faith and credit clause gives sanction to such control by one state of the internal affairs of another.” Yarborough v. Yarborough, supra, 214.
II.
It is apparently conceded that Louisiana would not have been required to apply the Texas statute had there not been a judgment in the particular case by the Texas tribunal. This freedom of the state to apply its own policy in workmen‘s compensation cases despite a conflicting statute in the state in which the accident occurs rests on the theory that the state where the workman is hired or is domiciled has a genuine and special interest in the outcome of the litigation. Alaska Packers Assn. v. Industrial Accident Comm‘n, 294 U. S. 532, 541-543, 549; cf. Pacific Employers Ins. Co. v. Industrial Accident Comm‘n, 306 U. S. 493, 503. These cases mark recognition of the fact that the authority of the states to act in any field is to be measured as much by vital state interests as by technical legal concepts. Cf. Hoopeston Canning Co. v. Cullen, 318 U. S. 313. The argument of state interest is hardly less compelling when Louisiana chooses to reject as decisive of the issues of the case a foreign judgment than when it rejects a foreign statute.
The interest of Texas in providing compensation for an injured employee who like respondent was only temporarily employed in the state is not the same as that of Louisiana where the respondent was domiciled and where the contract of employment was made. Someone has to take care of an individual who has received, as has respondent, an injury which permanently disables him from performance of his work. If employers or the consumers of their goods do not shoulder this responsibility, the general public of a state must. Neither state merely vindicates a private wrong growing out of tortious conduct. McKane v. New Amsterdam Casualty Co., 199 So. 175, 179 (Ct. of App. of La., Orleans); Texas Employers’ Ins. Assn. v. Price, 291 S. W. 287, 290. The Louisiana Act was passed in the interest of the general welfare of the people of Louisiana. Puchner v. Employers’ Liability Corp., 198 La. 922, 5 So. 2d 288.4 If it chooses to be more generous to injured workmen than Texas, no Constitutional issue is presented.
Today‘s decision is flatly in conflict with accepted law and practice. The Restatement of Conflict of Laws, § 403 states categorically that an “award already had under the Workmen‘s Compensation Act of another state will not bar a proceeding under an applicable Act, but the amount paid on a prior award in another state will be credited on the second award,” and one of the foremost studies of workmen‘s compensation states the same rule.5 Even in the absence of an express statute several state courts have explicitly approved this practice. Gilbert v. Des Lauriers Column Mould Co., 180 App. Div. 59, 167 N. Y. S. 274; Interstate Power Co. v. Industrial Commission, 203 Wis. 466, 234 N. W. 889; see similarly McLaughlin‘s Case, 274 Mass. 217, 174 N. E. 338; Migues‘s Case, 281 Mass. 373, 183 N. E. 847.
North Carolina provides by statute in cases like the present that the employee should be entitled to receive compensation provided that if he receives compensation from a state other than North Carolina, he will be given no more compensation by North Carolina than would raise the total recovery to the maximum allowed by the North Carolina law.6 Six other states have similar statutes.7 The Committee on Workmen‘s Compensation Legislation of the International Association of Industrial Accident Boards and Commissions has drafted a uniform state law on the subject which, were it applicable in the instant case, would permit the employee to waive his rights under the Louisiana law by bringing an action under the Texas law only by filing a written waiver with a Louisiana Commission which would not be binding until approved by such a Commission.8 This proposed uniform state law would presumably be unconstitutional under the decision announced today since it would leave in Louisiana the power to decide whether the employee should receive ad-
Whether the theory is that Texas did not intend its judgment to bar a proceeding in Louisiana or that the Texas workmen‘s compensation law is so incompatible with the policy of Louisiana that Louisiana is not bound by the Texas judgment, the result should be the same: There should be no Constitutional barrier preventing a state in effect from increasing the workmen‘s compensation award of another state in a case in which it has jurisdiction over the participants and the social responsibility for the results. Where two states both have a legitimate interest in the outcome of workmen‘s compensation litigation, the question of whether the second state which considers the case should abide by the decision of the first is a question of policy which should be decided by the state legislatures and courts.9 Certainly fair argument can be made for either disposition of the policy question. Texas itself decided the question one way by decision in the Price case, 300 S. W. 667, supra, and, to a limited extent, the other way by statute.10 State laws vary, and uniformity is not the highest value in the law of workmen‘s compensation, a point well made by the Supreme Court of Wisconsin when confronted with this very prob-
“This state adopted a very liberal act, and it is reasonably to be inferred that the legislature was more concerned with making certain that workmen within its jurisdiction should get all the benefits of the act than it was with any conflicts or legal difficulties which might arise out of lack of uniformity. Our plain duty is to give to the act its intended effect, and to leave to the legislature the enactment of provisions designed to limit its operation in the interest of uniformity.”
Much has been made in the argument here of the alleged vice of double recovery which is said to be allowed the respondent. Let me emphasize that there is no double recovery. In the first place the Louisiana court has deducted from its judgment the amount of the Texas payments. In the second place the aggregate of the awards from both states, if added together, would be far less than the total loss suffered by respondent. The Texas allowance scarcely amounts to a “recovery” in the sense of giving full compensation for loss, and has been described by a Texas court to be “more in the nature of a pension than a liability for breach of contract, or damages intact.” Texas Employers’ Ins. Assn. v. Price, 300 S. W. 667, supra, 669. See also Biddinger v. Steininger-Taylor Co., 25 Ohio Dec. 603, 608.
The Court seems in some parts of its opinion to adopt a wholly new and far reaching policy relating to the power of states to allow complete indemnification for a personal injury by permitting more than one suit against the wrongdoer, and to engraft this policy on to the full faith and credit clause. Courts schooled in the common law have long objected to what has been designated “splitting a cause of action.” They have phrased this policy objection in many common law concepts, one of which has been
III.
The effect of the decision of this Court today is to strike down as unconstitutional an important provision of the workmen‘s compensation laws of at least eleven states. For more than half a century the power of the states to regulate their domestic economic affairs has been narrowly restricted by judicial interpretation of the federal Constitution. The chief weapon in the arsenal of restriction, only recently falling into disrepute because of overuse, is the due process clause. The full faith and credit clause, used today to serve the same purposes, is no better suited to control the freedom of the states. The practical question now before us can be decided by the states in many ways and most of the states which have expressed themselves seem ready to dispose of the problem as has Louisiana. Our notions of policy should not permit the Constitution to become a barrier to free experimentation by the states with the problems of workmen‘s compensation.
MR. JUSTICE DOUGLAS, MR. JUSTICE MURPHY, and MR. JUSTICE RUTLEDGE concur in this opinion.
ATLANTIC REFINING CO. v. MOLLER.
No. 56. Argued December 7, 1943.—Decided December 20, 1943.
