sumed that the extra services were requested and performed under such contract as an incident thereof.

Where an employee voluntarily continues in a position under such conditions, known to him from the first day he undertook the work, receives the compensation agreed upon as a monthly salary, wholly fails to insist upon a definite understanding with regard to additional remuneration for such overtime, and protests but weakly against it, he will be deemed to have treated such overtime work as a mere incident of his usual duties, and to have waived any right to demand additional remuneration therefor.

WAGES-PENALTY FOR NONPAYMENT-DEMAND-ATTORNEY'S FEEMarrs v. Oregon Short Line Ry. Co., Supreme Court of Idaho (May 21, 1921), 198 Pacific Reporter, page 468.—Dock Marrs brought an action against the defendant company to recover wages as an employee and recovered a judgment for wages, attorney's fees, and a statutory penalty. Marrs had made a written demand for $33.90. The company admitted that $24.01 was due. The company appealed from the decision to the supreme court, which reversed the decision of the lower court and remanded the case with instructions to modify the judgment so as to eliminate the item for the attorney's fee, because Marrs had demanded more than was found to be due as wages. The statute on this point provides for an allowance of an attorney's fee if a proper demand is made of an amount not in excess of the amount found due. (C. S., sec. 7380.)

Marrs had recovered his wages and a penalty under section 7381, C. S., which requires the payment on demand of the wages due an employee, under penalty of a continuance of the wages for a term not exceeding 30 days, the court holding, one judge dissenting, that the demand of an amount in excess of the sum actually found due did not invalidate the right to the penalty.

After reviewing several opinions Judge Rice speaking for the court said:

The statute we are considering is designed for the protection of laborers and mechanics and to prevent the necessity of their being delayed in the collection of wages due upon ceasing their employment and the consequent loss of time while awaiting settlement for services rendered. It provides that, upon failure of an employer on demand to pay any wages or salary due to his employee under a contract of employment, he shall be liable as therein provided. The liability arises, not from failure to pay the amount demanded but from failure to pay any wages or salary due upon demand. (Hindman v. O. S. L. R. Co., 32 Idaho, 133, 140, 178, Pac. 837, 839.) We think the statute is within the police power of the State and is constitutional, even though the claimant demand a greater amount than is due, unless the circumstances are such as to excuse a tender

of the correct amount. In the case at bar the record does not indicate that an offer to pay the amount actually due would have been refused.

WAGES-PENALTY FOR NONPAYMENT-FEDERAL RAILROAD CONTROL-Missouri Pacific R. Co. et al. v. Ault, United States Supreme Court (June 1, 1921), 41 Supreme Court Reporter, page 593.—H. A. F. Ault had been employed by the Pacific Railroad Co. in Arkansas at the rate of $2.50 per day. On July 29, 1918, he was discharged. On this date $50 wages was due him but remained unpaid for some time thereafter. Ault brought suit before a justice of the peace against the Missouri Pacific Railroad Co. for wages due and a penalty for nonpayment. A statute of Arkansas provides that whenever a railroad company, or a receiver operating a railroad, shall discharge an employee, with or without cause, it shall pay him his full wages within seven days thereafter, and that if payment is not duly made "then as a penalty for such nonpayment the wages of such servant or employee shall continue from the date of the discharge or refusal to further employ at the same rate until paid." Ault recovered judgment by default. The company appealed to the circuit court, and there made a motion to substitute the Director General of Railroads. Substitution was refused, but the director was joined as defendant and judgment rendered against both for $440. The Supreme Court of Arkansas affirmed this judgment. The Supreme Court of the United States on writ of error reversed the judgment of the lower court. Justice Brandeis, for the court, said that the corporations were completely separated from the control and management of their railroads, and therefore the application of the railroad to be dismissed from this action should have been granted. On the question of the liability for the penalty the court said:

The purpose for which the Government permitted itself to be sued was compensation, not punishment. The amount recovered in the present case over and above the wages due and unpaid with interest is in the nature of a punishment. Congress has not given its consent that suits of this character be brought against the United States. The judgment against the director general, so far as it provided for recovery of the penalty, was erroneous.

OF CONTRACT

WAGES-PENALTY FOR NONPAYMENT-PLACE Klaffki v. Kaufman et al., District Court of Appeal of California (March 24, 1921), 198 Pacific Reporter, page 36.-Roy H. Klaffki brought this action upon his own claim and certain other claims assigned to him by his fellow laborers, for wages due for work per formed for the defendants. He did not allege in his pleadings where

the contract of employment had been made, where the work had been performed or where he was discharged. He claimed a penalty for the nonpayment of wages under a statute of California in substance as follows: When discharged an employee's wages become due at once and in case of nonpayment within 5 days after they become due, they continue from the date due until paid but not more than 30 days. Judgment was in favor of plaintiffs and the defendants appealed. The district court of appeals reversed the judgment and remanded the cause to the superior court with directions to allow the plaintiff to allege facts showing his right to recover penalties under the California statute. The court said in part:

An actionable wrong, to be redressed by the recovery of a penalty, depends upon the law of the place where the work was contracted for or where it was made payable, or possibly, upon the law of the place where the work was performed, or where the employee quit or was discharged.

In cases arising under the act of 1911 there are two substantive rights. There is the employee's common-law right to the wages earned by him under his contract of employment; and there is also the employee's statutory right to the unearned wages which the statute awards him as a penalty for his employer's conduct in continuing to withhold his earned wages after they are due. So also there are two separate and independent wrongs. There is the wrongful violation of the employee's right to receive, when due, the wages earned by him; and there is also the statutory wrong, visited by the imposition of a penalty, which consists in the continued withholding of the wages after the expiration of the five days.

BY STATUTE-UNITED

WAGES RATES RAILROADS CONTROL STATES RAILROAD LABOR BOARD-St. Louis Union Trust Co. v. Missouri & N. A. R. Co., United States District Court, Eastern District of Arkansas (Feb. 21, 1921), 270 Federal Reporter, page 796.—The Missouri and North Arkansas Railroad was built in 1907. From that date up to the present time the road never paid dividends and never even paid interest on its bonds. It was placed in the hands of a receiver, who found the condition of the road so deteriorated as to be unsafe for operation. The court authorized the issuance of receiver's certificates to the extent of $2,000,000. The road was unable to earn the interest on these certificates and more had to be sold to pay the interest. It has been found practically impossible to dispose of any more of the receiver's certificates at any price. On February 1, 1921, after a consultation with the judge, the receiver reduced the scale of wages of all the officers and employees to the basis in effect April 30, 1920. Certain employees through their representatives protested against the reduction and asked the receiver to establish the scale of wages existing by direction of the United States Railroad Labor

Board in its decision No. 2, which became effective May 1, 1920. The receiver petitioned the court for instructions and advice. The determinations of the court are in part as follows:

Courts must be just as honest as corporations and individuals, and if it incurs a debt, it must see its way clear to be able to pay at least the interest on it. To do otherwise would be practicing a fraud on the lenders. For this reason to attempt to borrow money on additional receiver's certificates, assuming they could be sold, is out of the question.

Only one of two remedies is left: To stop the operation of the road. or to cut down expenses wherever it is possible. To cease operating the road ought only to be restorted to, if no other remedy is left. Industries have been established along the road in reliance on the operation of the railway. These industries are entirely dependent on this road, to obtain raw material and to ship to the market the finished material. Without this road being operated, the investments in these industries would be absolutely destroyed. Many of the farmers residing along the road, and large numbers of others who have purchased lands and settled along the road, have planted valuable apple orchards and have no other means of sending their product to market except this road. To deprive them of the means of marketing the fruit means the destruction of the orchards. The court would therefore not be justified to stop the operation of the road, if it is at all possible to continue its operation. Therefore the only other remedy left is to reduce the salaries and wages of the employees at the same time, if it can be done without reducing them below a level which will enable them to provide for themselves and their families. The salary of the receiver, who is also the general manager of the road, has been reduced by the court 20 per cent, and has been accepted by the receiver.

The important question is whether, in view of these facts which are indisputable, the receiver would be subject to punishment under the provisions of section 312 of the cransportation act of February 28, 1920, c. 91, 41 Stat. p. 473. It may be conceded that the act is a constitutional exercise of the powers granted by the Constitution to Congress. But it is not conclusive that a carrier, whose earnings are insufficient to pay the wages established by the Railroad Labor Board, and unable to obtain by loans the money necessary to comply with its order, can be punished for failing to comply with the order.

To require it to continue in business at a loss is beyond the power of Congress or a State. In Brooks-Scanlon Co. v. Railroad Commission of Louisiana, 251 U. S. 396, 40 Sup. Ct. 183, the act of the State of Louisiana requiring a carrier to continue the operation of a road at a loss was held to be unconstitutional, as depriving the carrier of its property. While the opinion fails to state that the invalidity is by reason of the fourteenth amendment to the Constitution of the United States, it could rest on no other ground.

In this case, the transportation act having been enacted by Congress, the fourteenth amendment would not apply; but the fifth amendment to the Constitution does apply to acts of Congress. As the language used in both of these amendments is the same the same rule of construction must be applied to one as to the other.

In the instant case some of the employees have quit work, and others are protesting against the reduction of their wages. But the places of those who have declined to continue their employment have been filled by others equally competent and efficient, who are willing to receive the wages offered by the receiver; and, should the other employees see proper to quit, the receiver assures the court that he can fill their places, having many applications from competent men who are willing to accept employment at the wages offered.

In the opinion of the court the receiver is authorized and directed to pay the wages in force prior to April 30, 1920.

WAGES

RATES RAILROADS-EFFECT OF STATUTE-POWERS OF RECEIVER STATUS OF EMPLOYEES ON STRIKE-Birmingham Trust and Savings Co. v. Atlanta, B. & A. Ry. Co., United States District Court, Northern District of Georgia (March 26, 1921), 271 Federal Reporter, page 731.-This was a suit in equity in which a receiver had been appointed for the defendant railway company. On February 28, 1921, the receiver reported to the court that he had money available to pay the current pay roll, but that he would be unable to meet another similar pay roll; that the railway was not earning operating expenses; that the payment of greater wages than were earned by the company would be to take property without due process of law; and that the wages of unskilled labor should be reduced. An order of the court authorizing a reduction in wages was granted, to take effect March 1. N. H. Evans and others for themselves and as representatives of several unions made a motion to rescind the order, claiming also that under the transportation act only the Labor Board could reduce wages. The court modified its previous order by excepting therefrom train employees, but did not concede the jurisdiction of the Labor Board. The court, in its decision, speaking through Judge Sibley, said in part:

The existence in this case of some sort of contracts between the railway company and the labor unions is referred to in the pleadings, but the contracts are not themselves exhibited nor put in evidence. Since the order of the court authorizing the receiver to operate the railroad expressly provided that no contracts of the company were to be considered adopted by him without authority from the court; and, since the receiver's action on the matter of wages was taken within three days of his appointment, there can be no contention here that these contracts, whatever they were, had been adopted. Being unhindered by contracts the receiver made a showing, the accuracy of which has not yet been contested, which indicated that only by reducing his wage scale could he escape suspension of operation. Thereupon he was authorized to establish a reduced scale of wages and salaries, whereby all persons of all ranks should receive compensation on a basis of their pay December 31, 1917, plus one-half of increases since made, with the right to any and all employees to be heard on application.