United States v. Standard Oil Co. of California
332 U.S. 301 (1947)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
The United States government does not have a common law cause of action against a tortfeasor to recover for medical expenses and lost service time of a soldier injured by the tortfeasor's negligence; creating such a liability is a matter of federal fiscal policy reserved for Congress.
Facts:
- John Etzel was a soldier in the United States Army.
- In February 1944, a truck owned by Standard Oil Company of California and driven by its employee, Boone, struck and injured Etzel at a street intersection in Los Angeles.
- The U.S. Government paid for Etzel's hospitalization.
- The U.S. Government continued to pay Etzel his soldier's salary during his disability.
- Etzel accepted a payment of $300 from Standard Oil and Boone.
- In exchange for the payment, Etzel signed a release, freeing Standard Oil and Boone from any and all claims related to the accident.
Procedural Posture:
- The United States sued Standard Oil Company and its employee, Boone, in the U.S. District Court.
- Following a bench trial where a jury was waived, the District Court entered judgment in favor of the United States.
- Standard Oil and Boone, as appellants, appealed the decision to the U.S. Circuit Court of Appeals.
- The Circuit Court of Appeals reversed the judgment of the District Court, finding in favor of Standard Oil and Boone.
- The United States, as petitioner, was granted a writ of certiorari by the U.S. Supreme Court to review the decision of the Circuit Court of Appeals.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does the United States have a common law right of action against a tortfeasor to recover for hospitalization costs and pay expended for a soldier who was injured due to the tortfeasor's negligence?
Opinions:
Majority - Mr. Justice Rutledge
No. The United States does not have a common law right of action to recover from a tortfeasor for costs incurred due to injuries to a soldier. Although the government-soldier relationship is distinctively federal and governed by federal law under the principles of Clearfield Trust Co. v. United States, the creation of a new substantive liability is a matter for Congress, not the courts. The analogies to common law actions like a master for a servant's lost services are inapposite because this case involves the federal government and its fiscal policy. Creating a right for the government to recover these costs is a policy decision concerning the national purse, a domain exclusively entrusted to Congress. Since Congress has long been aware of such losses and has not enacted legislation to create this liability, the Court must refrain from judicial lawmaking in this area.
Dissent - Mr. Justice Jackson
Yes. The United States should have a right of action against the tortfeasor. Well-established common law principles hold that a wrongdoer is liable for all costs resulting from their negligence, including medical care and lost wages. Just as a husband or parent can recover such costs when a wife or child is injured, the government, which bears these costs for its soldiers, should be able to recover them. Denying recovery forces American taxpayers to subsidize the tortfeasor's wrongdoing. Applying settled tort law principles to a new factual scenario is a core judicial function, not a legislative usurpation, and the Court should not hesitate to do so in this case.
Analysis:
This case is a significant decision in the post-Erie R. Co. v. Tompkins landscape, defining the limits of 'federal common law.' The Court affirmed that while federal common law governs uniquely federal interests, such as the government-soldier relationship, federal courts should be reluctant to create new financial liabilities for the government. It established a strong precedent of judicial restraint, holding that matters of federal fiscal policy—like deciding when the Treasury should be reimbursed for losses—are the exclusive province of Congress. This decision effectively requires Congress to act affirmatively by statute if it wishes to create a right for the U.S. to recover damages in similar situations, reinforcing the separation of powers between the judicial and legislative branches concerning the national purse.
