P & Z CO., INC., J.F. SHEA CO., INC., AND P & Z CO., INC., AND J.F. SHEA CO., INC. (A Joint Venture)

OSHRC Docket No. 14822

Occupational Safety and Health Review Commission

July 31, 1979

[*1]

Before CLEARY, Chairman; BARNAKO and COTTINE, Commissioners.

COUNSEL:

Baruch A. Fellner, Office of the Solicitor, USDOL

Kenneth Hellman, Reg. Sol., USDOL

Harold Gordon, for the employer

OPINIONBY: BARNAKO

OPINION:

DECISION

BARNAKO, Commissioner:

The issue in this case is whether Judge Ben D. Worcester erred in denying the Secretary's motion to amend citations issued under the Occupational Safety and Health Act of 1970 n1 to add a new party respondent, and in granting the respondents' motion to dismiss the complaint and vacate the citations. We conclude that the Judge did err and set aside his decision. We remand for further proceedings.

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n1 29 U.S.C. 651 et seq., hereinafter "the Act."

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Following an inspection of a construction worksite in Washington, D.C., the Secretary sent citations alleging two serious and 28 nonserious violations of OSHA safety standards to:

L. N. Christensen, Manager P & Z Co., Inc. & J.F. Shea Co., Inc. P.O. Box 609 Ben Franklin Station Washington, D.C. 20044

Thereafter, a notice of intent to contest the [*2] citations was filed by an attorney, who identified his client as P & Z Co., Inc. - J.F. Shea Co., Inc. (A Joint Venture). The Secretary then filed his complaint, alleging that the violations listed in the citations were committed by three distinct employers: P & Z Co., Inc. (P & Z), J.F. Shea Co., Inc. (Shea), and P & Z Co., Inc. - J.F. Shea Co., Inc., (A Joint Venture). He moved to amend the caption of the citations to list these three parties as respondents, saying, "[c]omplainant has reason to believe that one or all of the parties named above are the proper party respondent. Complainant is unable to determine at this if any of the parties named above should not be considered the respondent in this case." n2 The respondents opposed the amendment and moved to vacate the citations, primarily arguing that none of the three employers had been properly served with a citation, that the complaint was defective because it failed to inform the respondents which of them had to defend the action, and that the citations should therefore be vacated as to all three employers.

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n2 In a document filed with the judge entitled "Secretary's Arguments in Support of Motion to Amend," the Secretary stated that the amendment "was an effort to add a joint venture as a party to a case involving the participants of the joint venture." The Secretary reiterated this position in his petition for discretionary review and his brief on review before the Commission.

[*3]

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Judge Worcester granted the respondents' motion and vacated the citations. n3 He viewed the Secretary's motion to amend as a concession that the Secretary had conducted an inadequate inspection and had therefore not determined which employer was the proper one to cite. He expressed the opinion that the proper procedure was for the Secretary to withdraw the citations, determine the proper employer to be cited, and reissue the citations to that employer. The Judge held that, notwithstanding the applicability to our proceedings of Rule 15 of the Federal Rules of Civil Procedure, which deals with amendments, the Commission could not acquire jurisdiction over an employer by way of an amendment to a citation. Instead, he viewed the provisions of Sections 9 and 10 of the Act, 29 U.S.C. 658 and 659, as barring the addition of a new party by way of amendment, citing Bloomfield Mechanical Contracting, Inc. v. OSHRC, 519 F.2d 1257 (3rd Cir. 1975). n4

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n3 The Judge originally issued an order summarily granting the respondents' motion. The Commission remanded, requiring the Judge to state the reasons for his disposition. 4 BNA OSHC 1252, 1976-77 CCH OSHD P20,728 (1976). The Judge's decision following remand, in which he stated the reasons for his action, is now before us.

n4 Insofar as here relevant, Section 9 provides that the Secretary, if he "believes that an employer has violated a requirement of (The Act)," shall issue a citation to the employer. Section 10(a) affords a cited employer fifteen working days from the receipt of the notification of proposed penalty associated with the citation to notify the Secretary that it intends to contest the citation. If the employer does not file a notice of contest, the citation becomes a final order of the Commission and is not subject to review by any court or agency. If a notice of contest is filed, then pursuant to Section 10(c) the Secretary must notify the Commission and Commission acquires jurisdiction over the contest.

[*4]

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The Secretary contends that the Judge erred in denying the amendment. In his view, the amendment should be permitted pursuant to Rules 15(a) and (c) of the Federal Rules of Civil Procedure. n5 He interprets Bloomfield Mechanical Contracting, supra, as permitting this type of amendment as a matter of right so long as the motion to amend is made within the six-month period established under the Act as a statute of limitations. n6 The respondents contend that the Judge's ruling was correct, arguing that none of the three entities the Secretary's complaint seeks to name as a respondent received adequate service of the citations, and that the Commission can therefore not exercise jurisdiction over them. They also contend that they would be prejudiced by the amendment.

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n5 These rules provide in pertinent part:

15(a): A party may amend his pleading once a matter of course at any time before a responsive pleading is served. . . Otherwise, a party may amend his pleading only by leave of court or by written consent of the adverse party; and leave shall be freely given when justice so requires.

15(c): An amendment changing the party against whom a claim is asserted relates back if the foregoing provision is satisfied and, within the period provided by law for commencing the action against him, the party to be brought in by amendment (1) has received such notice of the institution of the action that he will not be prejudiced in maintaining his defense on the merits, and (2) knew or should have known that, but for a mistake concerning the identity of the proper party, the action would have been brought against him.

n6 Section 9(c) of the Act provides, "No citation may be issued under this section after the expiration of six months following the occurrence of any violation."

[*5]

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In arguing that the citations were not properly served, the respondents assert that the citations were not addressed to P & Z and Shea as individual employers, but were instead mailed to a nonexistent entity, "P & Z Co., Inc. and J.F. Shea Co., Inc." They also contend that the citations were never issued to the Joint Venture. n71 Thus, they argue that the service requirements of Rule 4 of the Federal Rules of Civil Procedure n8 were not satisfied with respect to any of the three, and that the Commission therefore lacks jurisdiction over them. The Joint Venture also contends that a party that has not been issued a citation cannot be added to proceedings before the Commission by way of amendment, because the issuance of a citation is a prerequisite to the Commission's jurisdiction.

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n7 If the Secretary had intended to cite the Joint Venture, then the only defect in the citation would be the omission of the words "joint venture," and this technical misnomer could be easily corrected. See Urban Builders, Inc., 75 OSAHRC 82/E12, 3 BNA OSHC 1528, 1975-76 CCH OSHD P19,966 (No. 4626, 1975). The Secretary, however, before both the judge and the Commission, has stated that he intended to cite the individual employers, and seeks to add the Joint Venture by way of amendment, See n. 2, supra. As it is the Secretary who issued the citations, it is his intent that controls the identity of the cited person or persons. Bloomfield Mechanical Contracting, Inc., 519 F.2d at 1261. Moreover, the Secretary's statement that he intended to cite the individual employers is clearly detrimental to his case because it casts doubt on whether any of the three employers he now seeks to name in the complaint are properly named as respondents, whereas if he intended to cite the Joint Venture initially there would be no question that at least the Joint Venture was properly before us. Accordingly, the Secretary's statement that he intended to cite the individual employers is binding on him as a judicial admission, and is conclusive on the question of the Secretary's intent. See Rhoades, Inc. v. United Airlines, Inc., 340 F.2d 481, 484 (3rd Cir. 1965); Wigmore on Evidence, 2588, 2590, 2594 (3rd Ed. 1940).

n8 Rule 4(d)(3) provides for service:

(d)(3) Upon a domestic or foreign corporation or upon a partnership or other unincorporated association which is subject to suit under a common name, be delivering a copy of the summons and of the complaint to an officer, a managing or general agent, or to any other agent authorized by appointment or by law to receive service of process and, if the agent is one authorized by statute to receive service and the statute so requires, by also mailing a copy to the defendant.

[*6]

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We conclude that there is no jurisdictional bar to the amendment the Secretary seeks. The respondents would have us equate the mailing of a citation with the service of process provided for under Rule 4. A citation, however, does not institute an action before the Commission and is therefore not "process" within the meaning of Rule 4. Instead, the citation serves as notice to the employer that the Secretary alleges it has committed a violation. The employer may then invoke the Commission's jurisdiction by filing a notice of contest. See n. 4, supra.

This mechanism is similar to that provided in the Internal Revenue Code for invoking the jurisdiction of the Tax Court. Under that statute, the Commissioner must notify a taxpayer that the taxpayer allegedly owes additional taxes by mailing, by registered mail, a notice of deficiency to the taxpayer. 26 U.S.C. 6212(a). The notice is sufficient if mailed to the taxpayer "at his last known address." 26 U.S.C. 6212(b)(1). If the taxpayer wishes to challenge the Commissioner's allegation, he may contest the matter before the Tax Court by filing [*7] a petition for redetermination within 90 days of the notice of deficiency. 26 U.S.C. 6213. In Delman v. Commissioner of Internal Revenue, 384 F.2d 929 (3rd Cir. 1967), cert. denied, 390 U.S. 952 (1968), the taxpayers contended that the notice of deficiency was defective, and that the Tax Court therefore lacked jurisdiction, because the notice was mailed to their accounting firm rather than to their last known residential address. The Court held that, even if the mailing was technically not in compliance with the statute, it was nevertheless adequate because the taxpayers received actual notice. After examining the cases on the point, the Court reasoned:

It seems to us that those courts which have adopted the view that mailing of a technically perfect notice of deficiency is not a prerequisite to the jurisdiction of the Tax Court have the sounder approach. It appears that the other courts, as well as the petitioners, herein, have equated the notice of deficiency with the summons and complaint in a civil action. Service of a summons and complaint serves two functions: it provides notice of the institution and nature of an action, and it gives the court jurisdiction over [*8] the person of the party served. Technically perfect service is a prerequisite to the court's personal jurisdiction over the party served, although imperfect service may serve the notice function.

A notice of deficiency is very different. Its purpose is to notify the taxpayer that a deficiency has been determined against him. The mailing of a notice, unlike the filing of a complaint, does not commence an action in any court. It does not subject the taxpayer to the jurisdiction of the Tax Court. It merely allows the taxpayer, if he so desires, to commence an action in the Tax Court within the statutory period. It is his "ticket". There is no compulsion to use it. The common function of the summons and complaint and notice of deficiency is providing notice. The notice of deficiency does not, however, give the Tax Court jurisdiction over the person of the taxpayer. 384 F.2d at 933-4 (citations omitted)

We agree with these observations, which are equally applicable here. Accordingly, we conclude that if an employer receives actual notice of a citation, it is immaterial to the exercise of the Commission's jurisdiction that the manner in which the citation was sent was not technically [*9] perfect. n9 See also Fleisher Engineering and Construction Co. v. United States, 311 U.S. 15 (1940); Olsen v. Helvering, 88 F.2d 650 (2d Cir. 1937).

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n9 We do not suggest that actual notice is necessary to the validity of a citation. A validly issued citation may not provide actual notice because the employer mishandles it, and thereby fails to read it. We hold here only that if the citation does provide actual notice, a technial defect in the manner it was sent does not render it invalid.

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Nor do we find merit in the Joint Venture's argument that, because an employer must be issued a citation to set in motion the Act's enforcement mechanism, an employer who has not been issued a citation cannot be subjected to the Commission's jurisdiction by way of an amendment to a citation issued to another employer. If proceedings on a citation are instituted before the Commission, and the Secretary seeks to add a different employer than the one cited by way of an amendment, then notice to that employer of the [*10] motion to amend is notice that the Secretary alleges the employer has violated the Act in the manner set forth in the pleadings. The employer is then in the same position as it would have been had it received the citation in the first instance, or if it was issued a new citation at that point; it can choose to either admit the allegations or defend against them. Thus, adding the new party by way of amendment instead of by the issuance of a new citation is simply a matter of form. As long as the employer the Secretary seeks to add receives actual notice of the Secretary's allegations and has a full opportunity to defend, there is no statutory bar to the Commission's exercise of jurisdiction over that employer.

In this case, the Joint Venture received actual notice of both the citations and of the motion to amend. Its notice of contest states that the Joint Venture received the citations and, indeed, the fact that it filed a notice of contest demonstrates it must have had notice of the citations. Moreover, the Joint Venture has participated, through counsel, in all phases of this case and therefore had actual notice of the Secretary's motion to amend. We conclude there is no [*11] jurisdictional reason to deny the motion to amend to add the Joint Venture as a respondent.

Whether the individual employers are subject to the Commission's jurisdiction is less certain. Although the Secretary intended to cite them, the respondents interpreted the citation as being directed to the Joint Venture, and we cannot say that their interpretation was unreasonable. Accordingly, it may be that the individual employers did not have actual notice that the Secretary intended to cite them. Moreover, the only notice of contest was filed on behalf of the Joint Venture. Thus, even if the individual employers did have actual notice of the citations, the Commission does not have jurisdiction over them unless the notice of contest filed by the Joint Venture is interpreted as also applying to the individual employers.

We cannot resolve these questions here. The case is still in the pleading stage, and the questions whether the individual employers received sufficient notice and whether the notice of contest pertains to them may involve factual matters that can only be determined after a hearing. It may also involve questions concerning the legal relationship of a joint venture [*12] to its individual members that the parties have not had an opportunity to argue. Accordingly, the question whether the individual employers are subject to the Commission's jurisdiction will be left open, to be resolved on remand.

Having concluded that there is no jurisdictional bar to the amendment to add the Joint Venture as a party, we turn to the question whether the amendment should be allowed. Contrary to the respondents' argument, Bloomfield Mechanical Contracting, supra, does not preclude the amendment. In that case, the Court held that the Commission had improperly allowed a citation to be amended to name a joint venture as the responsible employer in place of one of the members of the joint venture. The Court, however, based its ruling on the fact that the motion to amend was made more than six months after the alleged violations occurred, thus giving rise to the question of whether the amendment was barred by the six-month statute of limitations found in Section 9(c) of the Act. Thus, the court viewed the question as being controlled by the "relation back" provision of Rule 15(c) (n. 5, supra), and it remanded to the Commission for an initial determination of whether [*13] Rule 15(c) could be used to overcome the bar of the statute of limitations. Implicit in the Court's opinion, however, was the assumption that the motion to amend could have been allowed if made within six months of the alleged violations. In this case, the motion to amend was made well within six months of the time of the alleged violations, so that the problem confronting the court in Bloomfield does not arise.

We conclude that the amendment should be allowed. Rule 15(a) of the Federal Rules of Civil Procedure provides that "leave (to amend) shall be freely given when justice so requires." Thus, an amendment should generally be permitted unless there is a substantial reason for disallowing it, such as bad faith on the part of the moving party, undue prejudice to the non-moving party, or undue delay in making the motion to amend. Usery v. Marquette Cement Manufacturing Co., 568 F.2d 902, 908 (2d Cir. 1977).

Here, the motion to amend was made at the earliest possible time, when the complaint was filed, so there was certainly no undue delay. The respondents, however, allege that they are prejudiced by the motion to amend, and they also imply that the motion is made in [*14] bad faith in that it represents an attempt by the Secretary to compensate for an inadequate inspection in which he failed to identify the proper employer to be cited. n10

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n10 The Respondents make this argument both as a reason for denying the amendment and for dismissing the case in its entirety. Our subsequent discussion is equally applicable to both of these contentions.

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We cannot conclude that the Secretary is seeking the amendment in order to compensate for an inadequate inspection. There are various theories under which more than one employer may be responsible for violations of the Act. For example, the question whether a joint venture and its individual members may be separately liable for violations of the Act has never been resolved. Cf. Bloomfield Mechanical Contracting, supra, 519 F.2d at 1261, n. 1. Furthermore, on a multi-employer construction site, an employer who creates or controls a violation as well as an employer whose employees are exposed to the resultant hazard may be liable. [*15] See Grossman Steel & Aluminum Corp., 76 OSAHRC 54/D9, 4 BNA OSHC 1185, 1975-76 CCH OSHD P20,691 (No. 12775, 1976). Thus, the mere fact that the Secretary charges multiple parties with the same violations provides no basis for concluding that he has inadequately identified the proper party to be cited. We therefore have no reason to believe that his assertion that all three entities may be responsible for the violations is made in bad faith.

Additionally, we note that the joinder of multiple defendants is contemplated by the Federal Rules of Civil Procedure. Rule 20 provides, in part:

All persons . . . may be joined in one action as defendants if there is asserted against them jointly, severally, or in the alternative, any right to relief in respect of or arising out of the same transaction, occurrence, or series of transactions or occurrences and if any question of law or fact common to all defendants will arise in the action.

Thus, the Federal Rules permit the result the Secretary seeks to achieve here: the joinder of multiple defendants in a single action. This further detracts from the respondents' contention that the Secretary is seeking to follow an unfair and improper [*16] procedure. n11

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n11 The Federal Rules apply to our proceedings unless we have adopted a different rule. 29 U.S.C. 661(f). We have no rule governing joinder of parties and the Federal Rules on the subject therefore apply.

We also note that the respondents allude to the possible applicability of Federal Rule 19, entitled "Joinder of Persons Needed for Just Adjudication." We do not perceive any way in which that rule is applicable here, or anything in that rule that would support by analogy the various contentions made by the respondents.

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The respondents claim that they would be prejudiced by the amendment because it would leave unclear who the proper respondent should be and create confusion among the respondents and their counsel. This contention has no merit. The amendment puts all three employers on notice that the Secretary seeks to prove they are responsible for the alleged violations, and all three employers have ample opportunity to prepare a defense to the charges. n12 There is no allegation by any of [*17] the employers of how the amendment would impair their ability to defend the case on its merits, and therefore no reason to conclude they would truly be prejudiced. See Cornell & Co. v. OSHRC, 573 F.2d 820 (3rd Cir. 1978); Craig D. Lawrenz & Associates, Inc., 77 OSAHRC 60/D8, 4 BNA OSHC 1464, 1976-77 CCH OSHD P20,910 (No. 5540, 1976).

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n12 We also note that Rule 21 of the Federal Rules of Civil Procedure provides:

Misjoinder of parties is not ground for dismissal of an action. Parties may be dropped or added by order of the court on motion of any party or of its own initiative at any stage of the action and on such terms as are just. Any claim against a party may be severed and proceeded with separately.

Thus, the respondents' argument that they are improperly joined in a single action provides no basis for dismissing the case. The proper avenue of relief for parties who contend they are improperly joined is to move that one or more of them be dropped from the action.

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Finally, both the respondents and [*18] the Judge refer to another case arising out of the same inspection, and involving the same parties, in which the Judge denied a similar motion to amend and the Secretary ultimately withdrew the citations. The respondents argue that the procedure followed by the Secretary in that case evidences the Secretary's recognition that the citations here were improperly issued. We disagree. This case must stand or fall on its own merits, and is not controlled by the Secretary's exercise of enforcement discretion in another case. T.J. Service Co., 78 OSAHRC 23/A2, 6 BNA OSHC 1509, 1978 CCH OSHD P22,670 (No. 14991, 1978).

Accordingly, the Secretary's motion to amend is granted, and the case is remanded for further proceedings. Because Judge Worcester is no longer assigned to the Judges' Office that is responsible for cases arising in the Washington, D.C. area, the case is remanded to the Chief Judge for reassignment to another administrative law judge.

CONCURBY: COTTINE (In Part)

DISSENTBY: COTTINE (In Part)

DISSENT:

COTTINE, Commissioner, concurring in part and dissenting in part:

I concur with the majority's holding that Judge Worcester erred in denying the Secretary's motion to amend the citations and in granting [*19] the Joint Venture's motion to dismiss. n1 Accordingly, I join in the majority's order reversing the judge's decision and remanding this case for further proceedings.

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n1 The majority characterizes the motion to dismiss as "the respondents' motion." Similarly, it refers throughout its opinion to the contentions of "the respondents."

The only formal appearance of record is the notice of contest. This document was filed by Harold Gordon, who identified himself as the attorney for the Joint Venture and stated that the notice of contest was filed on behalf of the Joint Venture. This statement of limited representation was reiterated by Mr. Gordon in a motion to dismiss the Secretary's complaint on the ground that it was not timely filed. Mr. Gordon also filed briefs before the Commission in response to the two directions for review in this case -- the order directing Judge Worcester's initial decision for review and the order directing his remand decision for review. Mr. Gordon clearly stated that the briefs were being filed on behalf of P & Z as well as the Joint Venture. The record does not further identify which client or clients Mr. Gordon was representing in this proceeding. From this record it is difficult to determine the date when Mr. Gordon began appearing on behalf of P & Z as well as the Joint Venture.

With respect to Shea, the record establishes that it has not been represented in this proceeding. In a document captioned "Respondent's Reply to the Secretary's Supplemental Memorandum of Law", Mr. Gordon clearly stated that he was not appearing on behalf of Shea. Moreover, Shea filed a separate response to the direction for review of Judge Worcester's initial decision in the form of a letter to the Commission from its project manager, Paul A. Millonig. In that letter, which is the only direct communication of record from a representative of Shea, Mr. Millonig indicated that Shea did not receive copies of the citation or direct notice of this proceeding and that Mr. Gordon was not acting as its representative.

Under these circumstances, I would treat the motion to dismiss as a motion by the Joint Venture rather than a motion by "the respondents."

[*20]

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However, I disagree with the majority's analysis of this case and therefore dissent from the majority's instructions to the judge on remand. The citations were initially issued to the Joint Venture. As a result of a timely contest, the Joint Venture became the original Respondent in this proceeding. Thus, the Secretary's motion to amend the citation with respect to the Joint Venture is properly treated as a motion to correct a technical misnomer under Fed. R. Civ. P. 15(a). In contrast, the Secretary's motion to amend with respect to P & Z and Shea individually is properly treated as a motion to add new parties under Fed. R. Civ. P. 21. n2 These motions should be granted and appropriate instructions issued to the judge consistent with relevant procedural authority.

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n2 The text of Rule 21 is set out at footnote 12 of the majority opinion.

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I

The majority begins its analysis of this case with a finding that the citations before us [*21] were issued to P & Z and Shea in their capacity as individual employers. n3 However, a finding that P & Z and Shea were cited in their individual capacities would require the dismissal of this case. Under the statutory scheme, a proceeding before this Commission is initiated when an employer files a notice of contest in response to a previously received citation and notification of proposed penalty. n4 Commission jurisdiction vests only when an identity exists between the cited employer and the contesting employer. When the identity between cited and contesting employer is absent, the Commission obtains no subject matter jurisdiction over the controversy. Following the majority's factual analysis, P & Z and Shea individually are the cited employers. However, the Joint Venture is the only contesting employer. The identity of employers is absent. Nevertheless, the majority assumes subject matter jurisdiction even though it cannot determine on the basis of the record before us whether P & Z and Shea individually are "subject to the Commission's jurisdiction." n5

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n3 The majority bases this finding on representations made by the Secretary's counsel which it characterizes as "a judicial admission." In support of this characterization it cites 2588 of Wigmore on Evidence, which defines a "judicial admission" as follows:

An express waiver, made in court or preparatory to trial, by the party or his attorney, conceding for the purposes of the trial the truth of some alleged fact . . .; so that the one party need offer no evidence to prove it, and the other is not allowed to disprove it. This is what is commonly termed a solemn -- i.e., ceremonial or formal -- or judicial admission, or stipulation. (emphasis in text).

It is obvious from the above definition that a judicial admission is not made unless at least two adverse parties have acted. One party must allege a fact and the other party must concede the truth of that fact for the purposes of the trial. However, there has been no allegation by any of the three employers that the citations were issued to P & Z and Shea individually. Instead, the Joint Venture and P & Z argue on review that the citations were issued to a nonexistent entity -- P & Z and Shea. Moreover, they claim that none of the three employers named in the amended caption was issued citations. The assertion by the Secretary's counsel that the citations were issued to P & Z and Shea individually is a mere allegation. It does not affirmatively admit the truth of any allegation by P & Z or the Joint Venture. In fact, these two parties opposing the Secretary deny his assertion at trial. Therefore, no judicial admission is properly charged against the Secretary in this proceeding.

n4 Commission jurisdiction may also be acquired by an employee notice of contest or a petition for modification of the abatement requirement. Section 10(c) of the Act, 29 U.S.C. 659(c). However, for the purposes of this proceeding, only the provisions of the Act relating to employer notices of contest will be considered for they constitute the only possible ground for asserting Commission jurisdiction in this proceeding.

n5 The consequences of the identity rule are intimated in the majority's opinion. In footnote 7, the majority states:

Moreover, the Secretary's statement that he intended to cite the individual employers is clearly detrimental to his case because it casts doubt on whether any of the three employers he now seeks to name in the complaint are properly named as respondents, whereas if he intended to cite the Joint Venture initially there would be no question that at least the Joint Venture was properly before us.

Later, the majority notes the jurisdictional consequences of non-identity:

Thus, even if the individual employers did have actual notice of the citations, the Commission does not have jurisdiction over them unless the notice of contest filed by the Joint Venture is interpreted as also applying to the individual employers.

However, the majority fails to recognize that the lack of identity between cited and contesting employers deprives the Commission of subject matter jurisdictionas well as personal jurisdiction over the individual employers in this proceeding.

[*22]

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Though I subscribe to the majority's conclusion that new parties can be added to a proceeding within the Commission's jurisdiction, I do not agree that parties can be added to a proceeding where the Commission lacks subject matter jurisdiction. Given the contentions raised by P & Z and the Joint Venture, the Commission must first determine whether subject matter jurisdiction exists in this proceeding. American Airlines, Inc., 74 OSAHRC 81/B3, 2 BNA OSHC 1326, 1974-75 CCH OSHD P18,908 (No. 4532, 1974). Cf. Fitchburg Foundry, Inc., 79 OSAHRC    , 7 BNA OSHC    , 1979 CCH OSHD P    (Nos. 77-520 & 77-1073, June 29, 1979) (Commission lacks jurisdiction to consider settlement agreement in the absence of a timely notice of contest). If subject matter jurisdiction exists, then the question of additional parties can be resolved.

The majority's finding that "the only notice of contest was filed on behalf of the Joint Venture" is supported by the record. n6 Therefore, the majority's threshold finding that the citations were issued to P & Z and Shea individually requires the conclusion that the [*23] Commission has no jurisdiction over this proceeding. The citations, under those circumstances, would be "deemed a final order of the Commission . . . not subject to review by any court or agency" because no notice of contest was filed within the period prescribed by statute by either P & Z or Shea. Section 10(a) of the Act, 29 U.S.C. 659(a).

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n6 The majority's remand instruction requiring the judge to determine whether the notice of contest can be "interpreted as also applying to the individual employers" is inconsistent with this finding. No explanation is supplied to reconcile this instruction with the clear statement of a contrary intent in the notice of contest.

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Moreover, my colleagues' consideration of the Secretary's motion exclusively as a motion to amend under Fed. R. Civ. P. 15(a) is improper. Under their theory of the case, the Joint Venture is being added as a party Respondent in an on-going proceeding against the original Respondents, P & Z and Shea. However, new parties cannot be added simply by [*24] filing an amended complaint in on-going proceedings governed by the Federal Rules of Civil Procedure. Under Federal Rule 21, an affirmative order must be obtained. Age of Majority Educational Corp. v. Preller, 512 F.2d 1241, 1245-6 (4th Cir. 1975). In Commission practice, this order is obtained from the administrative law judge. 29 U.S.C. 659(c); 29 C.F.R. 2200.2(b).

The order required by Federal Rule 21 provides essential notice to the litigating parties. As the U.S. Court of Appeals for the Ninth Circuit observed:

Normally a person becomes a party defendant because of the unfettered choice of the plaintiff. When a party is added in an on-going lawsuit, the approval of the court is required by Rule 21 in order to protect the parties already in the case whose rights might be seriously affected by the addition of a new party defendant. Rule 21 is not designed to protect the defendant to be added who is not entitled to notice. [citation omitted].

Hoffman v. Beer Drivers & Salesmen's Local Union No. 888, 536 F.2d 1268, 1272 (9th Cir. 1976). Accordingly, the notice required by Federal Rule 21 must be given to the original defending parties. However, no notice of [*25] the motion need be given to the party that the Secretary seeks to add to the proceeding. Under the majority's interpretation of the facts, P & Z and Shea would be the original defending parties and the Joint Venture, the added party. Following this factual analysis, the motion to add the Joint Venture under Federal Rule 21 would have to be denied because there is no record evidence that P & Z and Shea were served copies of the motion. n7

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n7 The majority's decision to apply Federal Rule 15(a) is further flawed by its failure to apply the proper Commission test under this rule. See P.A.F. Equipment Co., Inc., 79 OSAHRC    , 7 BNA OSHC 1209, 1212, 1979 CCH OSHD P23,421 at p. 28,340 (No. 14315, 1979).

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II

In my view, the record supports a finding that the citations before us were issued to the Joint Venture. The citations on their face are ambiguous. They can be interpreted either as citations to the Joint Venture or as citations to P & Z and Shea as individual employers. However, the fact that the citations [*26] were mailed to a single mailing address creates an inference that the Secretary intended to cite a single employer rather than two individual employers. Whatever the ambiguity of these citations, there is no ambiguity in the notice of contest. The letterhead on the notice of contest establishes that the post office box where the citations were sent was the mailing address for the Joint Venture. Moreover, the letter expressly states that the citations were received by the Joint Venture. Finally, it establishes that the Joint Venture interpreted the citations as citations issued to the Joint Venture. Under these circumstances and in the absence of any record evidence that the citations were issued to the individual employers, I would find that the citations were issued to the Joint Venture. n8 I would further find that the notice of contest was filed by the Joint Venture. Based on these findings, I would conclude that the Commission has subject matter jurisdiction over this proceeding and that the Joint Venture is the original Respondent.

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n8 An allegation was made by the Secretary that the citations were issued to P & Z and Shea individually. However, there are also allegations by the employers that, if proved, would support the finding that the citations were issued to the Joint Venture. Following the Commission's prior remand order, supra at note 3 of the majority opinion, Judge Worcester granted the parties an opportunity to file proposed findings of fact and conclusions of law. Among Mr. Gordon's submissions were proposed findings that the Joint Venture was "the contractor" at the inspected worksite and that no citations were issued to the individual employers. In the "Statement of Facts" section of his brief to the Commission, Mr. Gordon repeated these assertions. In a letter to the Commission, supra at note 1, Shea's representative also asserted that no citations were issued to Shea. Finally, I note that the Secretary alleges in his complaint that P & Z and the Joint Venture share the same mailing address -- the address where the citations were mailed -- but that Shea has a separate mailing address.

[*27]

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The Secretary's motion to amend the citation should be treated as two separate motions. As it relates to the Joint Venture, it is a motion under Commission Rule 33(a)(3), 29 C.F.R. 2200.33(a)(3), and Federal Rule 15(a) to amend the citation to correct a technical error in its caption -- the failure to include the words "a joint venture" after "P & Z Co., Inc. - J.F. Shea Co., Inc." The amendment is clearly permissible and the motion should be granted. John Hill, d/b/a Leisure Resources Corporation, 79 OSAHRC    , 7 BNA OSHC    , 1979 CCH OSHD P    (No. 78-47, June 29, 1979). See also P.A.F. Equipment Co. Inc., note 7, supra.

As it relates to P & Z and Shea individually, the Secretary's motion is a motion under Federal Rule 21 to add these employers as Respondents in this proceeding. I agree with the majority that Federal Rule 20 is applicable to this proceeding and that, under the terms of that rule, joinder of P & Z, Shea and the Joint Venture as multiple Respondents in this proceeding is permissible. The Secretary alleges that P & Z, Shea, and the Joint Venture are jointly, [*28] severally or alternatively responsible for the alleged violations described in the citation. Therefore, the test for joinder of multiple defending parties has been satisfied. I further note that the motion to add P & Z and Shea as Respondents was served on the original Respondent in this proceeding, the Joint Venture, as required under Rule 21. Accordingly, I would grant the Secretary's motion to add P & Z and Shea as Respondents.

I agree with my colleagues that the failure of the Secretary to issue a citation to an employer does not constitute a jurisdictional bar to the addition of the employer as a party Respondent. However, I would restrict that holding to a narrow set of circumstances. The Commission must first have subject matter jurisdiction over a proceeding before parties can be added to a proceeding. Subject matter jurisdiction is obtained when there is an identity between the cited employer and the contesting employer. However, subject matter jurisdiction is obtained only as to those allegations placed in contention by the notice of contest. Accordingly, I conclude that, in the context of a Commission proceeding, new respondents can only be added when the Secretary [*29] alleges that the employer to be added is jointly, severally or alternatively responsible for the violations alleged in the contested citation. In all other cases, the Commission lacks subject matter jurisdiction over the controversy between the Secretary and the employer to be added.

The fact that P & Z and Shea have not been issued citations raises a question of whether the Commission has personal jurisdiction over these employers. The lack of personal jurisdiction must be raised as an affirmative defense. Federal Rule 12(b) and (h). In my view, this defense should be sustained unless the record establishes (1) an identity of interests between the cited employer and the employer or employers to be added and (2) the employer or employers to be added had notice of the violative conditions that led to the proceedings before the Commission. If these conditions are met, I would conclude that the Secretary has substantially complied with the 9(a) requirement that the Secretary issue a citation to an employer he believes to be in violation to the Act. In addition, I would conclude that the Secretary's failure to literally comply with 9(a) has not prejudiced the uncited employer. [*30] Cf. Stephenson Enterprises, Inc. v. Marshall and OSHRC, 578 F.2d 1021, 1023 (5th Cir. 1978) (failure to comply with "reasonable promptness" provision of 9(a) does not support dismissal in the absence of prejudice); Marshall v. C.F. & I. Steel Corp. and OSHRC, 576 F.2d 809 (10th Cir. 1978) (failure to literally comply with "walk-around" requirement of 8(e) does not support dismissal in the absence of prejudice). Moreover, the Commission has personal jurisdiction over the added employer or employers notwithstanding the Secretary's failure to issue a citation to them as long as there is an identity of interest with the cited employer and the added employer had notice of the violative conditions.

Accordingly, I would grant the Secretary's motion to amend the caption and to add new Respondents and would remand the case for further proceedings consistent with this opinion.