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decided: February 23, 1932.



Hughes, Van Devanter, McReynolds, Brandeis, Sutherland, Butler, Stone, Roberts, Cardozo

Author: Hughes

[ 285 U.S. Page 36]

 MR. CHIEF JUSTICE HUGHES delivered the opinion of the Court.

This suit was brought in the District Court to enjoin the enforcement of an award made by petitioner Crowell, as deputy commissioner of the United States Employees' Compensation Commission, in favor of the petitioner Knudsen and against the respondent Benson. The award was made under the Longshoremen's and Harbor Workers' Compensation Act (Act of March 4, 1927, c. 509, 44 Stat. 1424; U. S. C. Tit. 33, §§ 901-950) and rested upon

[ 285 U.S. Page 37]

     the finding of the deputy commissioner that Knudsen was injured while in the employ of Benson and performing service upon the navigable waters of the United States. The complainant alleged that the award was contrary to law for the reason that Knudsen was not at the time of his injury an employee of the complainant and his claim was not 'within the jurisdiction' of the deputy commissioner. An amended complaint charged that the Act was unconstitutional upon the grounds that it violated the due process clause of the Fifth Amendment, the provision of the Seventh Amendment as to trial by jury, that of the Fourth Amendment as to unreasonable search and seizure, and the provisions of Article III with respect to the judicial power of the United States. The District Judge denied motions to dismiss and granted a hearing de novo upon the facts and the law, expressing the opinion that the Act would be invalid if not construed to permit such a hearing. The case was transferred to the admiralty docket, answers were filed presenting the issue as to the fact of employment, and the evidence of both parties having been heard, the District Court decided that Knudsen was not in the employ of the petitioner and restrained the enforcement of the award. 33 F.2d 137; 38 F.2d 306. The decree was affirmed by the Circuit Court of Appeals, 45 F.2d 66, and this Court granted writs of certiorari. 283 U.S. 814.

The question of the validity of the Act may be considered in relation to (1) its provisions defining substantive rights and (2) its procedural requirements.

First. The Act has two limitations that are fundamental. It deals exclusively with compensation in respect of disability or death resulting "from an injury occurring upon the navigable waters of the United States" if recovery "through workmen's compensation proceedings

[ 285 U.S. Page 38]

     may not validly be provided by State law," and it applies only when the relation of master and servant exists. § 3.*fn1 "Injury," within the statute, "means accidental injury or death arising out of and in the course of employment," and the term "employer" means one "any of whose employees are employed in maritime employment, in whole or in part," upon such navigable waters. § 2 (2) (4). Employers are made liable for the payment to their employees of prescribed compensation "irrespective of fault as a cause for the injury." § 4. The liability is exclusive, unless the employer fails to secure payment of the compensation. § 5. The employer is required to furnish appropriate medical and other treatment. § 7. The compensation for temporary or permanent disability, total or partial, according to the statutory classification, and in case of the death of the employee, is fixed, being based upon prescribed percentages of average weekly wages, and the persons to whom payments are to be made are designated. §§ 6, 8, 9, 10. Employers must secure the payment

[ 285 U.S. Page 39]

     of compensation by procuring insurance or by becoming self-insurers in the manner stipulated. § 32. Failure to provide such security is a misdemeanor. § 38.

As the Act relates solely to injuries occurring upon the navigable waters of the United States, it deals with the maritime law, applicable to matters that fall within the admiralty and maritime jurisdiction (Const. Art. III, § 2; Nogueira v. N. Y., N. H. & H. R. Co., 281 U.S. 128, 138); and the general authority of the Congress to alter or revise the maritime law which shall prevail throughout the country is beyond dispute.*fn2 In limiting the application of the Act to cases where recovery "through workmen's compensation proceedings may not validly be provided by State law," the Congress evidently had in view the decisions of this Court with respect to the scope of the exclusive authority of the national legislature.*fn3 The propriety

[ 285 U.S. Page 40]

     of providing by Federal statute for compensation of employees in such cases had been expressly recognized by this Court,*fn4 and within its sphere the statute was designed to accomplish the same general purpose as the workmen's compensation laws of the States.*fn5 In defining

[ 285 U.S. Page 41]

     substantive rights, the Act provides for recovery in the absence of fault, classifies disabilities resulting from injuries, fixes the range of compensation in case of disability or death, and designates the classes of beneficiaries. In view of Federal power to alter and revise the maritime law, there appears to be no room for objection on constitutional grounds to the creation of these rights, unless it can be found in the due process clause of the Fifth Amendment. But it cannot be said that either the classifications of the statute or the extent of the compensation provided are unreasonable. In view of the difficulties which inhere in the ascertainment of actual damages, the Congress was entitled to provide for the payment of amounts which would reasonably approximate the probable damages. See Chicago, B. & Q. R. Co. v. Cram, 228 U.S. 70, 84; compare Missouri Pacific Ry. Co. v. Tucker, 230 U.S. 340, 348. Liability without fault is not unknown to the maritime law,*fn6 and,

[ 285 U.S. Page 42]

     apart from this fact, considerations are applicable to the substantive provisions of this legislation, with respect to the relation of master and servant, similar to those which this Court has found sufficient to sustain workmen's compensation laws of the States against objections under the due process clause of the Fourteenth Amendment. New York Central R. Co. v. White, 243 U.S. 188; Mountain Timber Co. v. Washington, 243 U.S. 219; Ward & Gow v. Krinsky, 259 U.S. 503; Lower Vein Coal Co. v. Industrial Board, 255 U.S. 144; Madera Sugar Pine Co. v. Industrial Accident Comm., 262 U.S. 499, 501, 502; Sheehan Co. v. Shuler, 265 U.S. 371; Dahlstrom Metallic Door Co. v. Industrial Board, 284 U.S. 594. See Nogueira v. N. Y., N. H. & H. R. Co., supra, at pp. 136, 137.

Second. The objections to the procedural requirements of the Act relate to the extent of the administrative authority which it confers. The administration of the Act -- 'except as otherwise specifically provided' -- was given to the United States Employees' Compensation Commission,*fn7 which was authorized to establish compensation districts, appoint deputy commissioners, and make regulations. §§ 39, 40. Claimants must give written notice to the deputy commissioner and to the employer of the injury or death within thirty days thereafter; the deputy commissioner may excuse failure to give such notice for satisfactory reasons. § 12. If the employer contests the right to compensation, he is to file notice to that effect. § 14 (d). A claim for compensation must be filed with

[ 285 U.S. Page 43]

     the deputy commissioner within a prescribed period, and it is provided that the deputy commissioner shall have full authority to hear and determine all questions in respect to the claim. §§ 13, 19 (a). Within ten days after the claim is filed, the deputy commissioner, in accordance with regulations prescribed by the Commission, must notify the employer and any other person who is considered by the deputy commissioner to be an interested party. The deputy commissioner is required to make, or cause to be made, such investigations as he deems to be necessary and upon application of any interested party must order a hearing, upon notice, at which the claimant and the employer may present evidence. Employees claiming compensation must submit to medical examination. § 19. In conducting investigations and hearings, the deputy commissioner is not bound by common law or statutory rules of evidence, or by technical or formal rules of procedure, except as the Act provides, but he is to proceed in such manner "as to best ascertain the rights of the parties." § 23 (a). He may issue subpoenas, administer oaths, compel the attendance and testimony of witnesses, the production of documents or other evidence or the taking of depositions, and may do all things conformable to law which may be necessary to enable him effectively to discharge his duties. Proceedings may be brought before the appropriate Federal court to punish for misbehavior or contumacy as in case of contempt. § 27. Hearings before the deputy commissioner are to be public and reported stenographically, and the Commission is to provide by regulation for the preparation of a record. § 23 (b).*fn8 Compensation orders are to be filed in the office of the deputy commissioner, and copies must be sent

[ 285 U.S. Page 44]

     to the claimant and employer. § 19. The Act provides that it shall be presumed, in the absence of substantial evidence to the contrary, that the claim comes within the provisions of the Act, that sufficient notice of claim has been given, that the injury was not occasioned solely by the intoxication of the injured employee, or by the willful intention of such employee to injure or kill himself or another. § 20. A compensation order becomes effective when filed, and unless proceedings are instituted to suspend it or set it aside, it becomes final at the expiration of thirty days. § 21 (a). If there is a change in conditions, the order may be modified or a new order made. § 22. In case of default for thirty days in the payment of compensation, application may be made to the deputy commissioner for a supplementary order declaring the amount in default. Such an order is to be made after investigation, notice and hearing, as in the case of claims. Upon filing a certified copy of the supplementary order with the clerk of the Federal court, as stated, judgment is to be entered for the amount declared in default, if such supplementary order "is in accordance with law." Review of the judgment may be had as in civil suits for damages at common law and the judgment may be enforced by writ of execution. § 18.

The Act further provides that if a compensation order is "not in accordance with law," it "may be suspended or set aside, in whole or in part, through injunction proceedings, mandatory or otherwise, brought by any party in interest" against the deputy commissioner making the order and instituted in the Federal district court for the judicial district in which the injury occurred.*fn9 Payment is not to be stayed pending such proceedings unless, on hearing after notice, the court allows the stay on evidence

[ 285 U.S. Page 45]

     showing that the employer would otherwise suffer irreparable damage. § 21 (b). Beneficiaries of awards, or the deputy commissioner, may apply for enforcement to the Federal district court and, if the court determines that the order "was made and served in accordance with law," obedience may be compelled by writ of injunction or other proper process. § 21 (c).*fn10

As the claims which are subject to the provisions of the Act are governed by the Maritime law as established by the Congress and are within the admiralty jurisdiction, the objection raised by the respondent's pleading as to the right to a trial by jury under the Seventh Amendment is unavailing (Waring v. Clarke, 5 How. 441, 459, 460); and that under the Fourth Amendment is neither explained nor urged. The other objections as to procedure invoke the due process clause and the provisions as to the judicial power of the United States.

(1) The contention under the due process clause of the Fifth Amendment relates to the determination of questions of fact. Rulings of the deputy commissioner upon questions of law are without finality. So far as

[ 285 U.S. Page 46]

     the latter are concerned, full opportunity is afforded for their determination by the Federal courts through proceedings to suspend or to set aside a compensation order, § 21 (b), by the requirement that judgment is to be entered on a supplementary order declaring default only in case the order follows the law (§ 18), and by the provision that the issue of injunction or other process in a proceeding by a beneficiary to compel obedience to a compensation order is dependent upon a determination by the court that the order was lawfully made and served. § 21 (c). Moreover, the statute contains no express limitation attempting to preclude the court, in proceedings to set aside an order as not in accordance with law, from making its own examination and determination of facts whenever that is deemed to be necessary to enforce a constitutional right properly asserted. See Ohio Valley Water Co. v. Ben Avon Borough, 253 U.S. 287, 289; Ng Fung Ho v. White, 259 U.S. 276, 284, 285; Prendergast v. New York Telephone Co., 262 U.S. 43, 50; Tagg Bros. & Moorhead v. United States, 280 U.S. 420, 443, 444; Phillips v. Commissioner, 283 U.S. 589, 600. As the statute is to be construed so as to support rather than to defeat it, no such limitation is to be implied. Panama Railroad Co. v. Johnson, 264 U.S. 375, 390.

Apart from cases involving constitutional rights to be appropriately enforced by proceedings in court, there can be no doubt that the Act contemplates that, as to questions of fact arising with respect to injuries to employees within the purview of the Act, the findings of the deputy commissioner, supported by evidence and within the scope of his authority, shall be final. To hold otherwise would be to defeat the obvious purpose of the legislation to furnish a prompt, continuous, expert and inexpensive method for dealing with a class of questions of fact which are peculiarly suited to examination and determination by an administrative agency specially assigned to that task.

[ 285 U.S. Page 47]

     The object is to secure within the prescribed limits of the employer's liability an immediate investigation and a sound practical judgment, and the efficacy of the plan depends upon the finality of the determinations of fact with respect to the circumstances, nature, extent and consequences of the employee's injuries and the amount of compensation that should be awarded. And this finality may also be regarded as extending to the determination of the question of fact whether the injury "was occasioned solely by the intoxication of the employee or by the willful intention of the employee to injure or kill himself or another." While the exclusion of compensation in such cases is found in what are called "coverage" provisions of the Act (§ 3), the question of fact still belongs to the contemplated routine of administration, for the case is one of employment within the scope of the Act and the cause of the injury sustained by the employee as well as its character and effect must be ascertained in applying the provisions for compensation. The use of the administrative method for these purposes, assuming due notice, proper opportunity to be heard, and that findings are based upon evidence, falls easily within the principle of the decisions sustaining similar procedure against objections under the due process clauses of the Fifth and Fourteenth Amendments.*fn11

The statute provides for notice and hearing; and an award made without proper notice, or suitable opportunity

[ 285 U.S. Page 48]

     to be heard, may be attacked and set aside as without validity. The objection is made that, as the deputy commissioner is authorized to prosecute such inquiries as he may consider necessary, the award may be based wholly or partly upon an ex parte investigation and upon unknown sources of information, and that the hearing may be merely a formality. The statute, however, contemplates a public hearing and regulations are to require "a record of the hearings and other proceedings before the deputy commissioner." § 23 (b). This implies that all proceedings by the deputy commissioner upon a particular claim shall be appropriately set forth, and that whatever facts he may ascertain and their sources shall be shown in the record and be open to challenge and opposing evidence. Facts conceivably known to the deputy commissioner, but not put in evidence so as to permit scrutiny and contest, will not support a compensation order. Interstate Commerce Commission v. Louisville & Nashville R. Co., 227 U.S. 88, 93; The Chicago Junction Case, 264 U.S. 258, 263; United States v. Abilene & Southern Ry. Co., 265 U.S. 274, 288. An award not supported by evidence in the record is not in accordance with law. But the fact that the deputy commissioner is not bound by the rules of evidence which would be applicable to trials in court or by technical rules of procedure, § 23 (a), does not invalidate the proceeding, provided substantial rights of the parties are not infringed. Interstate Commerce Comm. v. Baird, 194 U.S. 25, 44; Interstate Commerce Comm. v. Louisville & Nashville R. Co., supra; Spiller v. Atchison, T. & S. F. Ry. Co., 253 U.S. 117, 131; United States v. Abilene & Southern Ry. Co., supra; Tagg Bros. & Moorhead v. United States, supra, at p. 442.

(2) The contention based upon the judicial power of the United States, as extended "to all cases of admiralty

[ 285 U.S. Page 49]

     and maritime jurisdiction" (Const. Art. III), presents a distinct question. In Murray's Lessee v. Hoboken Land and Improvement Co., 18 How. 272, 284, this Court, speaking through Mr. Justice Curtis, said: "To avoid misconstruction upon so grave a subject, we think it proper to state that we do not consider congress can either withdraw from judicial cognizance any matter which, from its nature, is the subject of a suit at the common law, or in equity, or admiralty; nor, on the other hand, can it bring under the judicial power a matter which, from its nature, is not a subject for judicial determination."

The question in the instant case, in this aspect, can be deemed to relate only to determinations of fact. The reservation of legal questions is to the same court that has jurisdiction in admiralty, and the mere fact that the court is not described as such is unimportant. Nor is the provision for injunction proceedings, § 21 (b), open to objection. The Congress was at liberty to draw upon another system of procedure to equip the court with suitable and adequate means for enforcing the standards of the maritime law as defined by the Act. The Genesee Chief, 12 How. 443, 459, 460. Compare Panama R. Co. v. Johnson, supra, at p. 388. By statute and rules, courts of admiralty may be empowered to grant injunctions, as in the case of limitation of liability proceedings. Hartford Accident & Indemnity Co. v. Southern Pacific Co., 273 U.S. 207, 218. See, also, Marine Transit Corporation v. Dreyfus, 284 U.S. 263. The Congress did not attempt to define questions of law, and the generality of the description leaves no doubt of the intention to reserve to the Federal court full authority to pass upon all matters which this Court had held to fall within that category. There is thus no attempt to interfere with, but rather provision is made to facilitate, the exercise by the court of its jurisdiction

[ 285 U.S. Page 50]

     to deny effect to any administrative finding which is without evidence, or 'contrary to the indisputable character of the evidence, or where the hearing is 'inadequate,' or 'unfair,' or arbitrary in any respect. Interstate Commerce Comm. v. Louisville R. Co., supra, at pp. 91, 92; Tagg Bros. & Moorhead v. United States, supra.

[ 285 U.S. Page 51]

     As to determinations of fact, the distinction is at once apparent between cases of private right and those which arise between the Government and persons subject to its authority in connection with the performance of the constitutional functions of the executive or legislative departments. The Court referred to this distinction in Murray's Lessee v. Hoboken Land and Improvement Co., supra, pointing out that "there are matters, involving public rights, which may be presented in such form that the judicial power is capable of acting on them, and which are susceptible of judicial determination, but which Congress may or may not bring them within the cognizance of the courts of the United States, as it may deem proper." Thus the Congress, in exercising the powers confided to it, may establish 'legislative' courts (as distinguished from 'constitutional courts in which the judicial power conferred by the Constitution can be deposited') which are to form part of the government of territories or of the District of Columbia,*fn12 or to serve as special tribunals "to examine and determine various matters, arising between the government and others, which from their nature do not require judicial determination and yet are susceptible of it." But "the mode of determining matters of this class is completely within congressional control. Congress may reserve to itself the power to decide, may delegate that power to executive officers, or may commit it to judicial tribunals." Ex Page 51} parte Bakelite Corp., 279 U.S. 438, 451. Familiar illustrations of administrative agencies created for the determination of such matters are found in connection with the exercise of the congressional power as to interstate and foreign commerce, taxation, immigration, the public lands, public health, the facilities of the post office, pensions and payments to veterans.*fn13

The present case does not fall within the categories just described but is one of private right, that is, of the liability of one individual to another under the law as defined. But in cases of that sort, there is no requirement that, in order to maintain the essential attributes of the judicial power, all determinations of fact in constitutional courts shall be made by judges. On the common law side of the Federal courts, the aid of juries is not only deemed appropriate but is required by the Constitution itself. In cases of equity and admiralty, it is historic practice to call to the assistance of the courts, without the consent of the parties, masters and commissioners or assessors, to pass upon certain classes of questions, as, for example, to take and state an account or to find the amount of damages. While the reports of masters and commissioners in such cases are essentially of an advisory nature, it has not been the practice to disturb their findings when they are properly based upon evidence, in the absence of errors of law,*fn14

[ 285 U.S. Page 52]

     and the parties have no right to demand that the court shall redetermine the facts thus found. In admiralty, juries were anciently in use not only in criminal cases but apparently in civil cases also.*fn15 The Act of February 26, 1845 (c. 20, 5 Stat. 726), purporting to extend the admiralty jurisdiction of the Federal district courts to certain cases arising on the Great Lakes, gave the right "to trial by jury of all facts put in issue in such suits, where either party shall require it." After the decision in the case of The Genesee Chief, supra, holding that the Federal district courts possessed general jurisdiction in admiralty over the lakes, and navigable waters connecting them, under the Constitution and the Judiciary Act of 1789 (c. 20, § 9, 1 Stat. pp. 76, 77), this Court regarded the enabling Act of 1845 as "obsolete and of no effect, with the exception of the clause which gives to either party the right of trial by jury when requested." The Eagle, 8 Wall. 15, 25. And this provision, the court said, was "rather a mode of exercising jurisdiction than any substantial part of it." See R. S. 566, U. S. C., Tit. 28, § 770.*fn16 Chief Justice Taney, in delivering the opinion of the Court in the case of The Genesee Chief, supra, referring to this requirement, thus broadly stated the authority of Congress to change the procedure in courts of admiralty:

[ 285 U.S. Page 53]

     "The power of Congress to change the mode of proceeding in this respect in its courts of admiralty, will, we suppose, hardly be questioned. The Constitution declares that the judicial power of the United States shall extend to 'all cases of admiralty and maritime jurisdiction.' But it does not direct that the court shall proceed according to ancient and established forms, or shall adopt any other form or mode of practice. The grant defines the subjects to which the jurisdiction may be extended by Congress. But the extent of the power as well as the mode of proceeding in which the jurisdiction is to be exercised, like the power and practice in all the other courts of the United States, are subject to the regulation of Congress, except where that power is limited by the terms of the Constitution, or by necessary implication from its language. In admiralty and maritime cases there is no such limitation as to the ...

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