North Shore Corporation v. Barnett

143 F.2d 172, 1944 U.S. App. LEXIS 3038

• Court: Court of Appeals for the Fifth Circuit
• Decided: June 9, 1944
• Docket: 10881
• Status: Published

Opinions

LEE, Circuit Judge.

Appellees, employees of appellant, brought this "action under Section 16(b) of the Fair Labor Standards Act of 1938, 29 U.S.C.A. § 216(b), to recover alleged unpaid minimum wages and overtime pursuant to Sections 6 and 7 of the Act, 29 U.S. C.A. §§ 206, 207. A motion to dismiss was granted as to certain of the employees.¹ This Court affirmed.² The Supreme Court reversed and remanded the case for further proceedings. 318 U.S. 125, 63 S.Ct. 494, 87 L.Ed. 656. The case was thereupon tried to the Court without a jury and resulted in a judgment awarding to each appellee specific unpaid wages, overtime compensation, penalties, and attorney’s fees. This appeal presents the question whether appellees, as held by the Court below, were covered by the Act; and, if so, whether some of the employees were exempt under Section 13(a) (11), 29 U.S. C.A. § 213(a) (11), which exempts “any switchboard operator employed in a public telephone exchange which has less than five hundred stations.”

Appellant is a Florida corporation which owns and operates a toll road in the State of Florida, connecting with U. S. Highway No. 17, a national arterial highway, a short distance north of the limits of the city of Jacksonville, Florida. The toll road extends from the national highway in an easterly direction to a point near the western shore of Fort George Inlet. It connects with a county road serving Fort George Island and affords the only means of communication by land between Fort George Island and the outside world. It crosses by means of drawbridges three navigable streams, Cedar Creek, Clapboard Creek, and Sisters’ Creek. It was built and opened for transportation in 1928. Tolls are collected by authority of Acts of the Florida Legislature, by which it is required that the road “be open for traffic at any and all times and maintained in a condition safe and suitable for travel * *

A wholly owned subsidiary of the appellant, namely, Bayshore Water & Light Company, owns and operates a telephone line which parallels the toll road, serves the same territory, and connects with the Southern Bell Telephone & Telegraph Company, a national telephone system, in Jacksonville.

The Court below found that while the amount of interstate commerce over the toll road “is not mathematically ascertainable from the evidence * * *, either in percentage of total traffic or otherwise; * * * according to defendant’s [appellant’s] own witnesses, such flow of commerce has been sufficiently constant to be neither, occasional nor accidental.”³ The Court below also found that “throughout said period, up to and including March 31, 1942, there has been a like flow of interstate telephone and telegraph messages over the telephone line * * 52 F. Supp. 503, 507. The evidence fully supports these findings.

Some of the appellees were engaged in the repair and maintenance of the toll road and bridges and the telephone line; others served as toll collectors, selling and collecting tickets issued for vehicles using the road. These toll collectors also made telephone connections for transmission of telephone and telegraph messages over the telephone line.

The Supreme Court in Overstreet v. North Shore Corporation, 318 U.S. 125, 132, 63 S.Ct. 494, 499, 87 L.Ed. 656, speaking of the toll road said:

“Petitioners, who are engaged in operating and maintaining respondent’s facilities so that there may be interstate passage of persons and goods over them-, are so closely related to that interstate movement as a practical matter that we think they must be regarded, under the allegations of their complaint, as ‘engaged in commerce’ within the meaning of §§ 6 and 7 of the Act.”

The three appellants in that case were serving as a bridge tender, a toll collector, and a maintenance laborer, respectively.

Appellant contends that such holding must be interpreted in the light of the allegations of the complaint, necessarily admitted for the purpose of the motion to dismiss, in which the interstate use of the toll road and bridges was alleged to be extensive. We do not find, however, that the Court rested its holding upon the alleged extensive use; we think a careful reading of the opinion justifies the view that the holding is based upon the fact of interstate use rather than upon the extent of such use.⁴

Appellant further contends that the toll road and bridges are not instrumentalities of interstate commerce because the evidence established that only a small portion of the traffic over them was interstate in character. Appellant relies strongly on Walling v. Jacksonville Paper Co, 317 U. S. 564, 572, 63 S.Ct. 332, 337, 87 L.Ed. 460, holding that “If a substantial part of an employee’s activities related to goods whose movement in the channels of interstate commerce was established by the test we have described he is covered by the Act,” and upon cases holding that an employee is not within the coverage of the Act when his duties of an interstate character are so insignificant as to be within the principle of de minimis non curat lex.

The law as laid down in Walling v. Jacksonville Paper Co, supra, is applicable to that class of cases which deals with employees whose duties relate in part to interstate shipments. It is not applicable to that class of cases which deals with employees having to do with maintenance or operation of instrumentalities of commerce.

Employees in the first class engage during the same work-week in activities strictly interstate in character and in activities strictly intrastate in character. Employees in the second class of cases, as here, engage in the same type of activities throughout each work-week. In the case before us the appellees are not concerned with goods or persons moving between two or more states by means of instrumentalities of interstate and intrastate transportation. They are concerned (1) in maintaining an instrumentality of transportation over which goods and persons in interstate and intrastate movements alike are being transported, and (2) in maintaining and operating an instrumentality of communication over which messages and telegrams in interstate and intrastate transactions alike are being transmitted.

“A track or bridge may be used in both interstate and intrastate commerce, but when it is so used it is none the less an instrumentality of the former; nor does its double use prevent the employment of those who are engaged in its repair or in keeping it in suitable condition for use from being in an employment in interstate commerce.” Pedersen v. Delaware, Lack. & West. R. R. Co, 229 U.S. 146, 152, 33 S.Ct. 648, 650, 57 L.Ed. 1125.

See also Miller v. Central R. Co. of New Jersey, 2 Cir, 58 F.2d 635.

The toll road and the telephone line are links in national transportation and communication systems. They are open and available at all times for interstate use. If the application of the Fair Labor Standards Act to employees engaged in maintaining the one and in maintaining and operating the other depends on the extent of the use of each in interstate commerce, then such use would make coverage often depend on adventitious and remote factors, at times even the weather. If coverage depends on the amount and character of traffic handled, which may fluctuate or alter from week to week, then employees engaged in maintaining the toll road and in maintaining and operating the telephone line may be under the Act one week and not under the Act the next. Such construction would to a certain degree render the Act nugatory.

In The Daniel Ball, 77 U.S. 557, 565, 10 Wall. 557, 19 L.Ed. 999, the Supreme Court said:

“ * * * far as gjje [The Daniel Ball] was employed in transporting goods destined for other states, or goods brought from without the limits of Michigan and destined to places within that State, she was engaged in commerce between the slates, and however limited that commerce may have been, she was, so far as it went, subject to the legislation of Congress. She was employed as an instrument of that commerce; for whenever a commodity has begun to move as an article of trade from one State to another, commerce in that commodity between the States has commenced. The fact that several different and independent agencies are employed in transporting the commodity, some acting entirely in one State, and some acting through two or more States, does in no respect affect the character of the transaction. To the extent in which each agency acts in that transportation, it is stxbject to the regulation of Congress.”

In Schmidt v. Peoples Telephone Union of Maryville, Mo., 138 F.2d 13, 15, in which the trial Court had referred to the number of interstate telephone messages as “trifling,” the Eighth Circuit Court said:

“The test here is not the amount of revenue derived by the employer from interstate calls nor the number of such calls in interstate commerce. We are not dealing with a situation where some inconsequential incident of interstate commerce happens to result from the general conduct of a fundamentally intrastate business. Here, the employer offered a continuous service to and from six towns in a state other than the state wherein its exchange was located. The employer admittedly was immediately and directly engaged in interstate commerce and held itself out as furnishing interstate communication service both to its subscribers and to the general public. The nature of the employer’s business here was such, by virtue of its being engaged directly and immediately in interstate commerce, that the employees, whose duty it was to handle such interstate communications, were clearly within the express language used by Congress in the Act and are covered, unless there is some specific exemption therefor.” ⁵

The Act exempts telephone and switchboard operators of a particular class. It does not exempt toll collectors and ticket sellers who may also operate a switchboard along with their other duties. The time spent by the toll collectors and ticket sellers in exempt activity and in nonexempt activity cannot be segregated. Such employees obviously are not within the Act’s exemption.

The Act is remedial. Under the facts, the Act is clearly applicable.

The judgment appealed from is correct and it is accordingly

Affirmed.

1 Overstreet v. North Shore Corporation. D.C., 43 F.Supp. 445.

2 Overstreet v. North Shore Corporation, 5 Cir., 128 F.2d 450.

3 Appellant’s witnesses testified that from five to eight per cent of the cars on the toll road bear foreign licenses. Appellees’ witnesses placed the percentage from twenty to thirty-three and one-third per cent.

4 In McLeod v. Threlkeld, 319 U.S. 491, 494, 63 S.Ct. 1248, 1250, 87 L.Ed. 1538, it is indicated that the rationale of the holding in the Overstreet case that the employees in that case were “engaged in commerce” was the fact that they were engaged in operating and maintaining toll roads and bridges over navigable waters and selling and collecting tickets for vehicles using the road. Mr. Justice Reed, as the organ of the Court, citing the Overstreet case, said: “Employees engaged in operating and maintaining privately owned toll roads and bridges over navigable waterways are ‘engaged in commerce.’ ”

Mr. Justice Murphy dissenting in the McLeod case, in referring to the Over-street case in which he was the organ of the Court, said: “We have held that * * * a seller of tickets on a toll bridge over which interstate traffic moves * * * [is] ‘engaged in commerce’ within the meaning of the Fair Labor Standards Act.”

5 See also National Tabor Relations Board v. J. G. Boswell Co., 9 Cir., 136 F.2d 585, 589.