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05/04/61 Theodore Britton, Deputy v. Great American Indemnity

May 4, 1961

COMPENSATION U.S. DEPARTMENT OF LABOR, APPELLANT

v.

GREAT AMERICAN INDEMNITY COMPANY, A CORPORATION, AND JO-DEL RESTAURANT, INC., A CORPORATION, APPELLEES.



Before BAZELON, FAHY and BASTIAN, Circuit Judges.

UNITED STATES COURT OF APPEALS DISTRICT OF COLUMBIA CIRCUIT. 1961.CDC.66

Theodore BRITTON, Deputy Commissioner, Bureau of Employees

May 4, 1961.

Petition for Rehearing En Banc Denied June 5, 1961.

DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE BAZELON

BAZELON, Circuit Judge.

An employer and its insurance carrier brought this suit against the Deputy Commissioner to set aside a compensation order directing payment of benefits to the dependents of two musicians fatally wounded by two disgruntled customers, who returned to the employer's premises after having been ejected. The amended complaint challenged only three of the defendant's findings: (1) that the deceased persons were employees and not independent contractors, (2) that the mother of one of the deceased was a dependent, and (3) that the award is based upon a properly determined wage rate.

These findings were sustained by the District Court at the hearing on defendant's motion for summary judgment. However, the court, sua sponte, noted an additional finding which it set aside - namely, that the homicides arose out of and in the course of employment. The defendant strenuously objected to this action on the ground that the issue was not urged either in the administrative proceeding or in the present complaint. In overruling this objection, the court stated orally that it would consider any issue upon which "there is evidence in the record." The court thereupon treated plaintiffs' memorandum in opposition to defendant's motion for summary judgment as a cross motion, and granted summary judgment in favor of plaintiffs. This appeal followed.

We agree with the District Court that the record supports the findings of the Deputy Commissioner challenged in the complaint. But we think that the court erred in considering the issue which it raised, sua sponte.

In the formal pleadings and pre-hearing procedures before the Deputy Commissioner, the employer and its carrier denied, inter alia, the allegation that the of employment. But at the hearing, in response to the Deputy Commissioner's effort to fix the issues for contest, counsel homicides arose out of and in the course specifically limited its denials to the allegations of employer-employee relationship, wages and dependency. *fn1 Thus the claimants were entitled to believe, as the Deputy Commissioner asserts they did, that the employer and its carrier had withdrawn their denial of the allegation now in question. The District Court read some of the evidence thereafter adduced at the hearing as disproving that allegation. It may not be assumed, however, that the claimants would have been unable to present countervailing evidence even if they had not been led to believe that the issues had been withdrawn. Maryland Casualty Co. v. Cardillo, 1939, 71 App.D.C. 160, 107 F.2d 959; Metropolitan Casualty Ins. Co. v. Hoage, 1937, 67 Ap p.D.C. 54, 89 F.2d 798.

In concluding that the employer and its carrier withdrew their pre-hearing denial of the allegation that the homicides arose out of and in the course of employment, we are fortified by the failure of their complaint herein to challenge the action of the Deputy Commissioner in sustaining that allegation.

Reversed and remanded for further proceedings in accordance with this opinion.

MINORITY OPINION

BASTIAN, Circuit Judge ...


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