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Irey v. Occupational Safety and Health Review Commission

July 24, 1975



Author: Weis

Before: STALEY, GIBBONS and WEIS, Circuit Judges



WEIS, Circuit Judge.

We revisit the important question of the right to a jury trial in an OSHA penalty proceeding. A majority of the panel which originally heard this case decided that the administrative proceedings did not run afoul of the Seventh Amendment. F.2d (3d Cir., No. 73-1765, Nov. 4, 1974). After further briefing and argument before the court in banc, we have concluded that the judgment of the panel should stand.

The factual background of the case is set out in the prior opinion, and we need not repeat it here. The employer-petitioner contends that the assessment of a civil penalty by the Occupational Safety and Health Review Commission was, for all intents and purposes, the same as an in personam monetary judgment. It argues that such a proceeding, being in the nature of debt, presents an issue which historically was tried at common law and, therefore, a jury trial should be available even though the government is the plaintiff. Hepner v. United States, 213 U.S. 103, 53 L. Ed. 720, 29 S. Ct. 474 (1909).

The requirement of a jury verdict could be met in a de novo trial in the district court on appeal from an administrative agency. However, the Occupational Safety and Health Act permits only limited judicial review of the administrative agency's factual findings under the "substantial evidence" test. It is that narrow scope of review which, according to petitioner, abrogated its Seventh Amendment right to a trial by jury, both as to the fact of violation and the amount of penalty.*fn1

The Secretary asserts that OSHA proceedings are essentially equitable and for that reason the Amendment does not apply. He contends that the enforcement procedures are designed to insure compliance with safety standards and that the purpose of civil penalties is to prevent recurrences of violations.

Since the scope of review is important to the resolution of this appeal, a survey of the Act's provisions on judicial review is appropriate. A person against whom a penalty has been imposed may obtain a review of the order in the appropriate United States court of appeals. That court is authorized "to make and enter upon the pleadings, testimony, and proceedings set forth in such record a decree affirming, modifying, or setting aside in whole or in part, the order of the Commission and enforcing the same to the extent that such order is affirmed or modified. * * * The findings of the Commission with respect to questions of fact, if supported by substantial evidence on the record considered as a whole, shall be conclusive." If further evidence is required, the court can order it to be taken before the Commission. 29 U.S.C. § 660(a).

The Secretary also has the right to petition the court for review. Alternatively, an OSHA order which has not been appealed by the employer may be filed by the Secretary with the clerk of the court of appeals, who will then enter a decree enforcing the order unless otherwise directed by the court. 29 U.S.C. § 660(b). The court of appeals may assess the civil penalties of 29 U.S.C. § 666(a)-(d) as well as any other available remedies in a contempt proceeding brought to enforce its decree. When, apparently, neither party has invoked the review jurisdiction of the court of appeals, civil penalties may be recovered in a civil action in the United States district court.*fn2 29 U.S.C. § 666(k).

In summary, while court review of the fact of violation and amount of penalty is limited by the substantial-evidence standard, the agency may compel payment only by resort to the judicial system. The Act does not totally exclude the judicial branch of government from overseeing and enforcing the statutory provisions. See National Labor Relations Board v. Kingston Cake Co., 206 F.2d 604, 611 (3d Cir. 1953). See also JAFFE, JUDICIAL CONTROL OF ADMINISTRATIVE ACTION 264 (1965).

The application of the Seventh Amendment to judicial proceedings traditionally depended on whether the suit was legal or equitable in nature. Parsons v. Bedford, 28 U.S. (3 Pet.) 433, 446, 7 L. Ed. 732 (1830). If a statute creates a new remedy which is to be processed in the courts, that distinction is pertinent and may determine whether a jury trial is required. Curtis v. Loether, 415 U.S. 189, 39 L. Ed. 2d 260, 94 S. Ct. 1005 (1974).*fn3

But, if the proceeding is before an administrative agency rather than in the courts, the Supreme Court has held that the Seventh Amendment does not apply. In NLRB v. Jones & Laughlin Steel Corp., 301 U.S. 1, 81 L. Ed. 893, 57 S. Ct. 615 (1937), an administrative award of back pay was challenged as violative of the Constitution. The Court said:

"It is argued that the requirement is equivalent to a money judgment and hence contravenes the Seventh Amendment with respect to trial by jury. The Seventh Amendment provides that 'In suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved.' The Amendment thus preserves the right which existed under the common law when the Amendment was adopted. [Citations] Thus it has no application to cases where recovery of money damages is an incident to equitable relief even though damages might have been recovered in an action at law. [Citations] It does not apply where the proceeding is not in the nature of a suit at common law. [Citation]

"The instant case is not a suit at common law or in the nature of such a suit. The proceeding is one unknown to the common law. It is a statutory proceeding. Reinstatement of the employee and payment for time lost are requirements imposed for violation of the statute and are remedies appropriate to its enforcement. The contention under the Seventh Amendment is without merit." 301 U.S. at 48-49. (Emphasis added).*fn4

The Court reiterated its position in Curtis v. Loether, supra, stating:

"Jones & Laughlin merely stands for the proposition that the Seventh Amendment is generally inapplicable in administrative proceedings, where jury trials would be incompatible with the whole concept of administrative adjudication and would substantially interfere with the NLRB's role in the statutory scheme... These cases uphold congressional power to entrust enforcement of statutory rights to an administrative process or specialized court of equity free from the strictures of the Seventh Amendment." 415 U.S. at 194-95 (footnote omitted).

The same theme was repeated a few months later in Pernell v. Southall Realty, 416 U.S. 363, 40 L. Ed. 2d 198, 94 S. Ct. 1723 (1974), in the context of a statute governing landlord-tenant disputes. While holding that a jury trial was required because of the underlying legal nature of the suit in the District of Columbia courts, Mr. Justice Marshall wrote:

"We may assume that the Seventh Amendment would not be a bar to a congressional effort to entrust landlord-tenant disputes, including those over the right to possession, ...

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