Chicago, Rock Island & Pacific Railway Co. v. Schendel

delivered the opinion of the Court.

These cases grow out of an accident on the line of the railway company in Iowa, in which Hope was killed and Elder was injured under circumstances establishing the negligence of the railway company and its consequent-liability for damages. The defense in each case was that the controlling issue had become res judicata: In the Hope case, petitioner pleaded a final judgment, entered,

The Iowa Workmen’s Compensation Law is elective in form. Hope and Elder were residents of Iowa and employees of the railway company, and it is not in dispute that they and the company had elected to be bound by its provisions. The statute will be found in the Code of Iowa, 1924, § 13.61, et seq. It adopts a schedule of compensation; creates the office of industrial commissioner, and authorizes him to appoint- a deputy, make rules and regulations not inconsistent with the act, summon witnesses, administer oaths, etc.; and contains other provisions, not necessary to be stated^ for its administration and .enforcement. If the parties fail to reach an agreement in regard to the compensation, the commissioner, at the request of either party, is directed to form a committee of arbitration to consist of three persons, one of whom shall be the commissioner, the others to be named

No. 683.

In the Hope case, the action was brought in the Minnesota district court on February 21, 1923, under the-Federal Employers’ Liability Law for the sole benefit of the surviving widow. Thereafter, on March 2, 1923, the railway company instituted a proceeding before the Iowa Industrial Commissioner under the Iowa Workmen’s Compensation Act. To this proceeding the decedent’s widow was made a party, as the sole beneficiary under the act. The railway company asked for an arbitration. The widow answered, asserting that the compensation act did not apply because the company and the deceased were both engaged in interstate commerce at the time of the accident. Arbitrators were appointed, though the widow did not join in their appointment. The arbitrators found that deceased was engaged in intrastate commerce and that the case was governed by the compensation ,act, and awarded compensation. to the widow; Thereupon, the widow filed a.n application in review with the commissioner. That officer reviewed the facts, specifically found

The Minnesota supreme court held that the plea of res judicata- was bad for two reasons: (1) that “the substantive right given the employe or his representative by Congress under express constitutional grant, with the courts to which he may go for its enforcement pointed out to him, is- a superior substantive right; and that' when he or. his representative has chosen the forum to which to submit- his cause, he cannot, against his objection and upon the initiative of his employér, be required to submit it in a summary proceeding commenced later under a compensation act;” and (2) that there was a lack of identity' of parties, since under the Iowa statute the right of recovery is in the beneficiary while under the federal act the right is in the personal representative.

1. It is evident from the opinion, that the court formulated the first reason with some hesitation. It is ele•mentary, of course, that, in any judicial proceeding, the arrangement of the parties on the record, so long as they are adverse, or the fact that the party against whom the estoppel is pléaded was an objecting party, is of no consequence. A judgment is as binding upon an unwilling defendant as it is upon á willing plaintiff. Nor is it material that the action or proceeding, in which the judgment, set up as an estoppel,-is rendered, was brought after the commencement of the action or proceeding in which it is pleaded. Where both are in personam, the second action or proceeding “ does not tend to impair or defeat the jurisdiction of the court in which a prior action for

It is urged in behalf of respondent, that the federal act is supreme and supersedes all state laws in respect of employers’ liability in interstate commerce. That is quite true; but it does not advance the solution of the point in dispute, since it is equally true that, in respect of such liability arising in intrastate commerce, the state law is supreme. Judicial power to determine the question in a case brought under a state statute is in no way inferior or, subordinate to the.same power in a case brought under the federal act.

The Iowa proceeding was brought and determined upon the theory that Hope was engaged in intrastate commerce; -the Minnesota action was brought and determined upon .the opposite theory that he was engaged in interstate commerce. The point at issue was the same. That the Iowa court had jurisdiction to entertain the proceeding' and decide the question under the. state statute, cannot be doubted. Under the federal act, the Minnesota court had equal authority; but the Iowa judgment' was first rendered. And, upon familiar principles, irrespective of which action or proceeding was first brought, it is the first final judgment rendered in one

The Iowa court., under the compensation law, in the due exercise of its jurisdiction, having adjudicated the character of the commerce in which' the deceased was engaged, that matter, whether rightly decided or not> must be taken as conclusively established, so long as the judgment remains, unmodified. United States v. Moser, 266 U. S. 236 , 241, and cases cited.. And, putting aside for the moment the question in respect of identity of parties, the judgment upon the point was none the less conclusive as res judicata because it was rendered under the state compensation law, while the action in which it was pleaded, arose under the federal liability law;: Dennison v. Payne, 293 Fed. 333 , 341-342; Williams v. Southern Pac. Co., supra, pp. 174-175.

2. In the Iowa proceeding, the widow of the deceased was a party in her own. right and clearly was bound.by the’judgment. The action in, Minnesota, however, was brought by the administrator, and. the state supreme. court, on the authority of Dennison v. Payne, supra, pp. 342-343 ; held, that there was a want of identity of parties. The decision in the Dennison case rests entirely on Troxell v. Del., Lack. & West. R. R., 227 U. S. 434 , The effect of .the last named case we pass for later consideration.

Hope’s death as the result of 'the negligence of the railroad company gave rise to a single cause of action,- to be enforced directly by the widow, under the state law, or in the name of the personal representative, for the sole benefit of the widow, under the federal law, depending upon the character of the commerce in.'which the deceased and- the company were engaged at the time of the acci

The first proposition finds support in Heckman v. United States, 224 U. S. 413 , 445-446, where this court held, that the. United States had capacity to maintain a suit to set aside conveyances- made by Indian allottees of allotted lands and that the allottees need not be joined.. The defendant in that case insisted that, unless the allottees who had executed' the conveyances were brought in' as parties, he was in danger of -being subjected-to a second suit by the allottees. Answering that contentión, this court said:

“ But' if the United States; representing the owners of restricted lands, is entitled to bring a suit of this character, it must follow that the decree will bind'not only the United States, but the Indians whom it represents in the litigation. This consequence is involved in the rep

resentation. Kerrison v. Stewart, 93 U. S. 155 , 160; Shaw v. Railroad Co., 100 U. S. 605 , 611; Beals v. Ill. &c. R. R. Co., 133 U. S. 290 , 295. And it could not, consistently with any principle, be tolerated that, after the United States on behalf of its wards had invoked the . jurisdiction of its courts to cancel conveyances in violation of the restrictions prescribed by Congress, thesé wards should themselves be permitted to relitigate the question.”

And, conversely, in United States v. Des Moines Valley R. Co., 84 Fed. 40 , where a,, suit in the name of the government was brought to enforce the right of a. private party, it was held that a prior adverse adjudication by a state court in a suit against him personally, determining the samé, issues, was available as an estoppel against the government. The ground of the decision was thus stated (pp. 44-45):

“ Inasmuch, then, as the government sues for the sole benefit of Fairchild, and for the professed purpose of reinvesting, him with. a title which he has lost, , we are of opinion that, whether the present action be regarded as brought under the act of March 3, 1887 ( 24 Stat. 556 , c. 376), or as brought in pursuance of its general right to. sue, the government should be held estopped by the previous adjudications against the real party in interest in the state court. The subject-matter and the issue to be tried being the same in this proceeding as in the former actions, the losing party on the former trials ought not to be permitted to renew the controversy in the name of a merely nominal plaintiff, and thereby avoid the. effect of the former adjudications. Southern Minnesota Railway Extension Coi v. St. Paul & S. C. R. Co., 12 U. S. App. 320, 325, 5 C. C. A. 249 , and 55 Fed. 690 . This doctrine-was applied by this court in the case.of Union Pac. Ry. Co., v. U. S., 32 U. S. App. 311, 319, 15 C. C. A. 123 , and 67 Fed. 975 , which was a suit brought by the United States under the act of March 3, 1887, wherein we

held that the United States was bound by an estoppel which might have been invoked against the real party in interest if the suit had been brought in his name, because it appeared that the United States had no substantial interest in the controversy, and was merely a nominal plaintiff.”

Since the statutory authority of the administrator is to sue, not in his own right or for his own benefit or that of the estate, but in the right and for the sole benefit of the widow, the same principles are applicable, in accordance with the general rule that “whenever an action may properly be maintained or defended by a trustee in his representative capacity without joining the beneficiary, the latter is necessarily bound by the judgment.” 1 Freeman on Judgments, 5th ed., § 500. Identity of parties is not a mere matter of form, but of substance. Parties •nominally the same may be, in legal effect, different, Bige-low on Estoppel, 6th ed., 145; and parties nominally different may be, in legal effect, the same. Calhoun’s Lessee v. Dunning, 4 Dall. 120 , 121; Follansbee v. Walker, 74 Pa. St. 306 , 309; In re Estate of Parks, 166 Iowa 403 .

In the Follansbee case, a judgment against Joshua Fol-lansbee alone was held available as an estoppel in another action brought by Walker & Follansbee for the use of Joshua. Justice Shárswood, speaking for-the court; said:

“ The parties in that suit arid in the action tried below were substantially the same. In the former,. Joshua Fol-lansbee was the legal, in the latter, he is the equitable plaintiff. The subject-matter of the two suits appeared by the record to be identical. The presumption would be upon the issues, that the merits had been passed upon in the former proceeding. Such being the case, if no technical objection appeared to have been raised upon the record to, the. right of Joshua Follansbee to maintain the action as legal plaintiff, the judgment in that action would be a bar to a subsequent action by him as equitable plain

tiff. If it appeared that only the equitable, not the legal right, was in Joshua Follansbee, it would be presumed that the defendant had waived that purely technical objection. • It would be very unreasonable and contrary to the settled rules upon the subject, to permit the plaintiff having once been defeated on the merits, to try the same question over again in a different form.”

In the Parks case, a judgment against the sole beneficiary of an estate in her individual capacity, was held conclusive in a subsequent action by the same plaintiff against the same defendant as administratrix, on the ground that, while theoretically the former suit was not against the same defendant as administratrix, nevertheless she was the sole beneficiary of the estate and represented only herself in each case.

In Corcoran v. Chesapeake, etc. Canal Co., 94 U. S. 741 , 745, this court, holding that a judgment against a trustee for bondholders was conclusive in a suit involving the same subject-matter, brought by him in his-individual character, said: “ It would be a new and very dangerous doctrine in the equity practice to hold that the cestui que trust is not bound by the decree against his trustee in the very matter of the trust for which he was appointed.” See also, Kerrison, Assignee, v. Stewart et al., 93 U. S. 155 , 160; Spokane Inland R. R. v. Whitley, 237 U. S. 487 , 496; Estate of Bell, 153 Cal. 331 , 344; Chandler v. Lumber Co., 131 Tenn. 47 , 51.

Upon facts. almost identical with those now under review, it was held in Williams v. Southern Pac. Co., supra, pp. 571, 576, that there was. a substantial identity of parties and that a judgment for the widow under the California compensation act was available as an estoppel in a pripr action brought by her as administratrix under the federal act. ; ;

It remains only to consider the bearing of the Troxell case, supra, upon this point. Mrs. Troxell, the widow of

Whether, in the light of the foregoing views, we now should hold that where, as in the Troxell case, the rights of additional beneficiaries, not actual parties to the first judgment, are involved, the requirement- of - -identity of parties-is unsatisfied, is a question, we-do not feel called upon here to reexamine'; since we are clear that such requirement is fully met in .the situation now under consideration, where the sole beneficiary was an actual -party to. the proceeding under the state laW,ancl present by her statutory representative in' the .action under the federal law, and no other rights were involved. '

No. 684.

In the Elder case, as in the casé just considered, the railway Company began a proceeding before the indus

It follows that the judgment in the Hope case must be reversed and that in the Elder case affirmed.

No. 683: Judgment reversed and cause remanded for further proceedings not inconsistent with this opinion.

No. 68jj. Judgment affirmed.