2. CONSTITUTIONAL LAW 301

(40 Sup.Ct.) MASTER not to exceed three thousand five hundred dollars."

AND SERVANT 347-DETERMINATION BY
STATE OF DETAILS AS TO COMPENSATION FOR
FACIAL OR HEAD DISFIGUREMENT.

Whether an award to an injured employé
for permanent facial or head disfigurement
should be made in combination with, or inde-
pendent of, the compensation allowed for mere
inability to work, is a matter of detail for de-
termination by the state, as is also the ques-
tion whether the compensation should be paid
in a single sum or in installments; decision
one way or the other not rendering the portion
of a state Workmen's Compensation Act un-
constitutional as a taking without due process
in violation of the Fourteenth Amendment.
Mr. Justice McReynolds dissenting.

In Error to the Supreme Court, Appellate Division, Third Judicial Department, of the State of New York.

In the matter of the claims of George Sweeting and others, employés, for compensation under the Workmen's Compensation Law, against the American Knife Company and others, the employers, and the Etna Life Insurance Company the insurance carrier. From orders of the Appellate Division of the Supreme Court (186 App. Div. 925, 172 N. Y. Supp. 880; 186 App. Div. 926, 172 N. Y. Supp. 921; 186 App. Div. 925, 172 N. Y. Supp. 924), affirming awards of the State Industrial Commission, the employers and insurance carrier appealed to the Court of Appeals of New York, which affirmed (226 N. Y. 199, 123 N. E. 82; 123 N. E. 856, 893), and the employers and insurance carrier bring error. Judgments affirmed.

The present writs of error bring up for review three judgments of the Court of Appeals of that state, affirming orders of the Supreme Court, Appellate Division, Third Judicial Department, in which awards based upon this amendment were sustained. The opinion of the Court of Appeals, applicable to all of the cases, is reported under the title of Matter of Sweeting v. American Knife Co., 226 N. Y. 199, 123 N. E. 82.

In each case the commission found accidental injuries sustained by an employé in a hazardous occupation, arising out of and in the course of the employment, and, as a result of the injury, some serious facial or head In each case an disfigurement, or both. award was made on account of such disfigurement irrespective of the allowance of compensation according to the schedule based upon the average wage of the injured employé and the character and duration of the

disability.

[1] The sole contention here is that the amendment of 1916, as thus carried into ef*601 fect, deprives the respective plaintiffs *in error of property without due process of law, in contravention of the Fourteenth Amendment.

The argument is that an award for disfigurement, made wholly independent of claimant's inability to work, is not based upon impairment of earning power; that only such impairment can justify imposing upon an employer without fault compulsory pay

In No. 374: Mr. Robert E. Whalen, of Al- ment by way of compensation to an injured bany, N. Y., for plaintiff in error.

In Nos. 375, 376: Mr. William H. Foster, of Syracuse, N. Y., for plaintiffs in error. Mr. E. C. Aiken, of Albany, N. Y., for Industrial Commission of New York.

*600

workman; and hence that the "disfigurement clause" is not a reasonable exercise of the police power, but is arbitrary and oppressive.

In view of our recent decisions sustaining state laws imposing upon employers in the hazardous industries responsibility in one

*Mr. Justice PITNEY delivered the opinion form or another for the consequences of inof the Court.

juries received by employés in the course of the employment in the absence of fault on the employer's part (New York Central R. R. Co. v. White, 243 U. S. 188, 37 Sup. Ct. 247, 61 L. Ed. 667, L. R. A. 1917D, 1, Ann. Cas. 1917D, 629; Mountain Timber Co. v. Wash

The Workmen's Compensation Law of the state of New York (chapter 816, Laws 1913, as amended and re-enacted by chapter 41, Laws 1914 [Consol. Laws, c. 67]), which was sustained by this court against attacks based upon the Fourteenth Amendment in Newington, 243 U. S. 219, 37 Sup. Ct. 260, 61 L. York Central R. R. Co. v. White, 243 U. S. 188, 37 Sup. Ct. 247, 61 L. Ed. 667, L. R. A. 1917D, 1, Ann. Cas. 1917D, 629, was amended by Laws 1916, c. 622, among other things by inserting in the fifteenth section, which contains the schedule of compensation for cases of disability, a clause reading as follows:

Ed. 685, Ann. Cas. 1917D, 642; Arizona Employers' Liability Cases, 250 U. S. 400, 39 Sup. Ct. 553, 63 L. Ed. 1058), little need now be said.

Even were impairment of earning power the sole justification for imposing compulsory payment of workmen's compensation "In case of an injury resulting in serious fa- upon the employer in such cases, it would be sufficient answer to the present contencial or head disfigurement the commission may in its discretion, make such award or compention to say that a serious disfigurement of sation as it may deem proper and equitable, in the face or head reasonably may be regarded view of the nature of the disfigurement, but as having a direct relation to the injured For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

person's earning power, irrespective of its | provision debar a state from adopting other effect upon his mere capacity for work. methods, or a composite of different methods, Under ordinary conditions of life, a seri- provided the result be not inconsistent with ous and unnatural disfigurement of the face fundamental rights. As was stated in the or head very probably may have a harmful | Arizona case, 250 U. S. 429, 39 Sup. Ct. 559, effect upon the ability of the injured person 63 L. Ed. 1058:

of action for compensation to injured workmen upon grounds not arbitrary or fundamentally unjust, the question whether the award shall be measured as compensatory damages are measured at common law, or according to some prescribed scale reasonably adapted to produce a fair result, is for the state itself to determine."

to obtain or retain employment. Laying "If a state recognizes or establishes a right aside exceptional cases, which we must assume will be fairly dealt with in the proper and equitable administration of the act, such a disfigurement may render one repulsive or offensive to the sight, displeasing, or at least less pleasing, to employer, to fellow employés, and to patrons or customers. See Ball v. Wm. Hunt & Sons, Ltd., [1912] App. Cas. 496.

602

And we see no constitutional reason why

⚫603

But we cannot concede that impairment of earning power is the sole ground upon which a state may not, *in ascertaining the amount compulsory compensation to injured work-of such compensation in particular cases, men legitimately may be based. Unques- take into consideration any substantial phystionably it is a rational basis, and it is adopt-ical impairment attributable to the injury, ed for the generality of cases by the New whether it immediately affects earning caYork law. But the Court of Appeals has pacity or not. construed the 1916 amendment as permitting For the reasons thus outlined, it was not an allowance for facial or head disfigure- unreasonable, arbitrary, or contrary to funment although it does not impair the claim-damental right to embody in the New York ant's earning capacity. Matter of Erickson | Workmen's Compensation Law a provision v. Preuss, 223 N. Y. 365, 368, 119 N. E. 555; and see opinion of Judge Cardozo in the present case, 226 N. Y. 199, 200, 123 N. E. 82. In view of this, and there being no specific | the allowance prescribed by the 1916 amendfinding of such impairment in these cases, it is proper to say that in our opinion the "due process of law" clause of the Fourteenth Amendment does not require the states to base compulsory compensation solely upon loss of earning power.

for a special allowance of compensation for a serious disfigurement of the face or head. Nor is there any ground for declaring that

ment exceeds the constitutional limitations upon state power.

[2] Whether an award for such disfigure ment should be made in combination with or independent of the compensation allowed for the mere inability to work is a matter of detail for the state to determine. The same is true of the question whether the compensation should be paid in a single sum, or in installments. Arizona Employers' Liability Cases, 250 U. S. 400, 429, 39 Sup. Ct.

The New York law as at first enacted, the Washington, and the Arizona laws presented for our consideration three different methods adopted for the purpose of imposing upon the industry the burden of making some compensation for the human wastage attributa-553, 63 L. Ed. 1058. ble to the hazards of the work. We were unable to find that any of these ran counter to the "due process" clause. Nor does that

Judgments affirmed.

Mr. Justice McREYNOLDS dissents.

(251 U. S. 1)

(40 Sup.Ct.)

District Court found that the charge was UNITED STATES v. SOUTHERN PAC. CO. true and entered a decree of cancellation,

et al.

(Argued March 5 and 6, 1919. Decided Nov.

17, 1919.)

No. 179.

and this was reversed by the Circuit Court of Appeals, one judge dissenting. Southern Pac. Co. v. United States, 249 Fed. 785, 162 C. C. A. 19.

[1] "All mineral lands" other than those

1. PUBLIC LANDS 78 RAILROAD GRANT Containing coal or iron were excluded from

EXCLUDING

LANDS.

Evidence in suit by the government to cancel for fraud a patent to a railroad company for indemnity lands held to entitle it to the relief, as showing that, when the patent was sought and obtained on affidavit that the lands were nonmineral, they were known by the company's officers to be valuable for oil; that is, that the then known conditions were such as to reasonably engender the belief that the lands contained oil of such quality and in such quantity as would render its extraction profitable and justify expenditures to that end.

Appeal from the United States Circuit Court of Appeals for the Ninth Circuit.

Suit by the United States against the Southern Pacific Company and others. De cree of District Court for the United States was reversed by the Circuit Court of Appeals (249 Fed. 785, 162 C. C. A. 19), and the United States appeals. Decree of Circuit Court of Appeals reversed, and decree of District Court affirmed.

#2

*Messrs. J. Crawford Biggs, of Raleigh, N. C., and Assistant Attorney General Kearful, for the United States.

Messrs. Charles R. Lewers, and William F. Herrin, both of San Francisco, Cal., for appellee.

*6

*Mr. Justice VAN DEVANTER delivered the opinion of the Court.

This is a suit by the United States to cancel a patent issued December 12, 1904, to the Southern Pacific Railroad Company for eight full and two partial sections of land within the indemnity limits of the grant made to that company by an act of Congress (Act July 27, 1866, c. 278, 14 Stat. 292), it being charged in the bill that the railroad

*7

company *fraudulently obtained the patent by falsely representing to the land department that the lands were not mineral but agricultural, when it was known that they were mineral. From the evidence presented the

the grant, and this exclusion embraced oil lands. Burke v. Southern Pacific R. R. Co., 234 U. S. 669, 676-679, 34 Sup. Ct. 907, 58 L. Ed. 1527. As will be seen presently, there can be no doubt that the patent was procured by representing that the lands were not mineral. Whether this representation was false turns upon the character of the lands as known when the patent was sought and obtained. If they then were known to be valuable for oil, as the government asserts they were, they were mineral in the sense of the granting act.

To compensate for losses to the grant within its primary limits the railroad company was entitled to select other lands of like area within the indemnity limits, approval by the Secretary of the Interior being essential to passing the selections to patent. The established mode of making the selections was by presenting at the local land office selection lists designating the lands lost and those selected, with supporting af fidavits showing, among other things, tha the lands selected were of the character

contemplated, that is to say, were not miner al but agricultural. These lists and affida vits would then be examined in that office and in the General Land Office, and ulti mately the selections would be passed to the Secretary of the Interior for his action. That course was followed here.

The original list was presented November 14, 1903, but it encountered obstacles which

led to the presentation of a substituted list

*8

covering the same lands on Septem*ber 6, 1904. Both lists were presented by the company's land agent, Mr. Eberlein, and were accompanied by affidavits made by him stating that the lands selected "are not interdicted mineral," but "are of the character contemplated by the grant," and that "he has caused" them "to be carefully examined by the agents and employés of said company as to their mineral or agricultural character, and that to the best of his knowledge and belief none of the lands returned in said list are mineral lands." In acting

on the substituted list the officers of the Land Department relied upon and gave effect to the statements in the supporting affidavits, and the selections were accordingly approved and passed to patent.

In truth Mr. Eberlein had not examined the lands or caused them to be examined by others. Nor had any examination of them

For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

been made on behalf of the railroad company, save such as is inferable from the conduct of its geologists and others presently to be noticed.

In

were requested to designate the lands to be
thus leased and as a result of their investi-
gation and recommendation several sections
adjacent to and some immediately adjoining
those in suit were included. The lease was
to be signed on behalf of the railroad com-
pany by Mr. Eberlein as land agent and was
laid before him for that purpose on August
2, 1904. Perceiving at once that its execu-
tion would not be in ac*cord with his action
in pressing the pending selection list he took
To one he said in a letter:
the matter up with some of his superiors.

10

The lands were in the Elk Hills in Kern county, California; were rough, semi-arid and unfit for cultivation; were devoid of timber, springs or running water; and had but little value for grazing. Oil had been discovered in that region as early as 1899, and this had been followed by development and production on an extensive scale. 1903 and 1904 there were many producing wells about 25 miles to the east and many within a much shorter distance to the west and south, some within 3 or 4 miles. The railroad company was then maintaining a corps of geologists-all informed by experi-istence of this lease become known it would go ence in the California oil fields-and under their supervision was searching for, develop ing and producing oil for fuel purposes. In 1902, upon the recommendation of one of its geologists, it withdrew from sale many of its patented lands surrounding and adjacent to those in suit "because they were in or near oil territory," and early in 1903 it entered upon a systematic examination of its

*9

lands in that territory "to determine as far as can be done from surface indications and geological structure where oil is to be expected in this region." In a letter to Mr. Kruttschnitt, one of the company's vice presidents, the chief geologist said when about to take up the examination:

"So far as I can judge from the trip I have just made over this territory, this work promises results of greatest value to the company."

The lands in suit were surveyed in 1901 and the approved plat was filed in the local land office in May, 1903. The field notes denominated the lands as mineral and described them as in a mineral district "within which many successful oil wells have been developed." As before stated, the original selection list was presented November 14, 1903. Mr. Kruttschnitt already had written to the company's attorney at Washington requesting that "special attention" be given to securing a patent for the lands when selected, and shortly thereafter Mr. Eberlein wrote to the attorney, saying:

"I am particularly anxious in regard to this list as the lands adjoin the oil territory, and Mr. Kruttschnitt is very solicitous in regard to it."

Other letters and telegrams show that this special concern or anxiety persisted until the patent was issued.

In 1903 the company concluded to lease such of its lands as were considered "valuable for oil purposes" to a subsidiary company, which was to be a sort of fuel department and to have charge of the development and production of oil. The geologists

"We have selected a large body of lands interspersed with the lands sought to be conveyed by this lease, and which we have represented as non-mineral in character. Should the ex

a long way toward establishing the mineral character of the lands referred to, and which are still unpatented. We could not successfully resist a mineral filing after we have practically established the mineral character of the land. I would suggest delay at least until this matter of patent can be adjusted."

To the same officer he protested against the action of the geologists in examining unpatented lands because "it was charging the company with notice." And to another, in New York, he explained "all phases of the matter," with the result that the "impropriety of the lease at that time" and the "very ambiguous position in which we would be placed" were recognized, and he was instructed to withhold his signature and to place and keep all correspondence and papers relating to the lease in a separate and private file not accessible to others. He followed the instruction and the special or secret file remained in his possession "until," as he testified, "it was pried out" at the hearing.

But, notwithstanding what was brought to his attention through the proposed oil lease, Mr. Eberlein continued actively to press the pending selection, and when, about a month later, he presented the substituted selection list it was accompanied by affidavits wherein he repeated his prior representation that the lands were not mineral. After presenting this list he had a conference with the chief geologist which prompted the latter, when writing to a superior officer, to explain that

"For reasons of policy regarding certain unpatented lands it will be best not to execute the lease at present."

*

*11

*The lease was placed by Mr. Eberlein in the special or secret file and some time afterward, when an effort was made to find it, he denied all knowledge of it. The denial was brought to the attention of the chief geologist, and he at once wrote to Mr. Eberlein calling attention to the conference just mentioned, and stating:

(40 Sup.Ct.)