BEFORE:
HONORABLE FRED H. KUMPF
Judge of Compensation

APPEARANCES:

DAVID TYKULSKER & ASSOCIATES, ESQS.
By: DIANE E. RISTAINO, ESQ.
Attorney for the Petitioner

SCHILLER & SASSO, ESQS.
By: RICHARD M. SASSO, ESQ.
Attorney for the Respondent

This is the Workers’ Compensation matter of John R. Mitchell versus Celodon Trucking Company, Claim Petition number 99-032748. This claim arises out of an alleged occupational injury manifesting on March 3, 1999. Respondent in its answer denied jurisdiction claiming that Indiana Workers’ Compensation laws applied and that the New Jersey Workers’ Compensation Court did not have jurisdiction over this injury. A Motion to Dismiss was filed on January 20, 2000, which Motion the court now decides.

The respondent admitted the employment of petitioner until March 3, 1999 but has left the petitioner to his proofs as to all other issues. For the purposes of this motion I will assume petitioner sustained an injury which arose out of and in the course of his employment with Celodon Trucking Company ( hereinafter Celodon ). I make the following findings of fact.

FACTS

The petitioner worked for the respondent, Celodon, as an over the road truck driver, driving a tractor-trailer with a 53' trailer. He earned 28 cents a mile and averaged $500 per week during the period that he worked for the respondent. Celodon is located in Indianapolis, Indiana and does no business in New Jersey. Petitioner lived in New Jersey. The petitioner while in New Jersey learned of the job with Celodon after reading an advertisement indicating that Celodon was looking for experienced drivers. In November or December 1998 the petitioner called a phone number which was in the ad, and spoke with a recruiter, Ms. McKay. The petitioner indicated to Ms McKay that he had a New Jersey driver’s license with air-brake endorsement and a commercial driver’s license. The petitioner indicated further that he was a tractor- trailer instructor at the Windsor Driving School. Ms. McKay seemed very interested in the petitioner as a potential employee. She sent to the petitioner an application for employment with Celodon and requested that he it complete it and return it to Celodon in Indiana. She indicated he would have to pass a urine test for drugs. She also sent to the bus station in Newark a bus ticket from Newark, New Jersey to Indianapolis, Indiana, which the petitioner could use to get to Celodon.

When the petitioner did not send in a completed application, petitioner was again called by Ms. McKay, who indicated to petitioner Celodon’s interest in the petitioner as a potential employee. They sent the petitioner another bus ticket for him to use to travel from New Jersey to Indianapolis, Indiana. He was told that he could fill out the job application and other paperwork associated with his employment when he got to Indiana. He was told he would receive $350 for the first week during orientation and thereafter he would be paid for his driving at 28 cents per mile. In January 1999 petitioner went to the bus station and used the ticket provided by Celodon to travel to Indiana. When petitioner arrived in Indiana he went to Celedon and completed his job application and the other paperwork required of employees.

On his application for employment petitioner indicated his address as 437 South 17^th Street in Newark, New Jersey. The petitioner’s wife lived in New Jersey except from 1990 to 1991 when she lived with their son in South Carolina. In 1999 from January to March she also was with her son in South Carolina, but then returned to Newark, New Jersey. At all times petitioner kept his apartment in Newark, New Jersey. After the petitioner began working for Celodon he initiated steps to move to South Carolina. He was in the process of moving to South Carolina to live with his son at the time of his testimony on April 14, 2000.

Among the papers that petitioner signed when he began his employment with the respondent was Celodon’s standard employment contract of hire which provided in pertinent part that Indiana law would apply to that employment. There was a specific Workers’ Compensation acknowledgment and agreement which provided that the laws of the State of Indiana including the Indiana Workers’ Compensation Act and its benefits shall apply to the settlement of any claim arising out of any job-related injury or disease of the employee. The contract provided further that the employee agreed to this method of resolution regardless of his or her state of residence or domicile. Petitioner did not remember anyone explaining that he was giving up the right to file a Workers’ Compensation claim in New Jersey. He indicated he signed whatever he had to, to get the job. Petitioner also requested a payroll deduction authorization for a passenger rider in the vehicle who was designated as the petitioner’s wife. Petitioner requested this pay be sent to Marion, South Carolina to his son’s address.

For the first two weeks of the petitioner’s employment he was in training and was driving with another driver who was his trainer. After this training period petitioner became an over the road driver for the respondent and was paid by the mile. The petitioner drove all over the 48 states and on two occasions apparently he spent some time driving through New Jersey. Petitioner’s loads were generally not to New Jersey although he stopped in New Jersey once after he delivered a load to Pennsylvania. The petitioner’s wife often rode with him during his trips for Celodon. On three occasions during the petitioner’s employment he spent overnight at the Celodon facility in Indiana waiting for his next load the following day. Based upon these facts I make the following conclusions.

CONCLUSIONS

For the purposes of these conclusions I will assume that petitioner did sustain an injury arising out of and in the course of the employment. The question before the court is one of jurisdiction. Initially the question is whether the court has in personam jurisdiction over the respondent. The respondent was an Indiana corporation, which did not do business in New Jersey. The jurisdiction of the court is not based upon de facto power over the defendant’s person. Due process requires only that in order to subject a defendant to a judgment in personam, when they are not present within the forum, there be certain minimal contacts within such forum that the maintenance of a legal action does not offend traditional notions of fair play and substantial justice. See International Shoe Company v. State of Washington, 326 U.S. 310, 66 S. Ct. 154 (1945), 90 L. Ed. 95, 161 ALR 1057; Bell v. Evergreen’s Arena, Inc., 115 N.J. 317 (1989); Groven v. William J. Scully, Inc., 42 N.J. Super. 174 (App. Div. 1956). As stated in Gendler v. Telecom Equipment Corp., 102 N.J. 460, 470-72:

When the causative action arises out of the defendant’s contacts with the forum state, it is more likely that the contacts will subject the defendant to the jurisdiction of the forum than if the cause arises from unrelated contacts. If the cause is related to the defendant’s contacts with the forum state, an isolated act may be sufficient to subject the defendant to the jurisdiction of the forum.

The court goes on to state that there is a two-step analysis to determine whether a respondent has sufficient contacts with the foreign state. The first step is to determine whether the employer has sufficient contacts with the forum state. The second step is to evaluate these contacts in light of other factors to determine whether the assertion of personal jurisdiction comports with "fair play and substantial justice." Id..

Using this analysis in the circumstances of this case, this claim arises out of the contract of hire that was the subject of the contacts by Celodon with New Jersey. It does seem to be fair play and substantial justice to require the Celodon to defend this Workers’ Compensation claim in New Jersey. An out-of-state corporation specifically telephoned a worker in New Jersey to induce the New Jersey worker to come to a state far away to work with no real situs of the employment. The potential employee could not on his own have gone to the distant state so he was supplied with a one-way bus ticket to come to the foreign state to work. Since such an itinerant worker has no presence in the foreign state, when the worker ultimately becomes injured it is natural for the worker to return to his place of residence. Common sense dictates that it should be within the contemplation of the corporation that such a worker would return to their place of residence, where they originally contacted the worker to offer employment. A worker might be so severely injured that they may not be able to travel to the foreign state to pursue their Workers’ Compensation rights there. When a worker is severely injured, it would be an undue hardship to require them to travel to Indiana in order to seek Workers’ Compensation benefits. If Workers’ Compensation benefits are not payable to the petitioner and other similar employees and they become in need of assistance it would fall upon the State of New Jersey to provide appropriate medical and financial assistance to the petitioner.

For these reasons, I conclude that the State of Jersey does have in personam jurisdiction over the respondent. The contacts by the foreign corporation with New Jersey were specifically an offer of employment to a resident worker from New Jersey, the petitioner. This Workers’ Compensation action arises out of the respondent’s contacts with the State of New Jersey for the contacts were an offer of a job in the performance of which the petitioner was injured leading to the Workers’ Compensation claim. In the facts of this case there were sufficient contacts by Celodon with New Jersey by seeking out potential employees in New Jersey through advertising and phone conversations by recruiters from the company. Here employment recruiters on several occasions contacted petitioner to try to get the petitioner to come to Indiana to work for the company. Celodon sent a bus ticket to New Jersey in order to induce petitioner to come to Indiana. This provides sufficient contacts for in personam jurisdiction under our case law.

Having determined that the New Jersey Workers’ Compensation Court has in personam jurisdiction over the respondent, we move now to the next question whether New Jersey has a right to assert its Workers’ Compensation statute in the circumstances of this case. I conclude that New Jersey does have jurisdiction to apply its Workers’ Compensation Act in the facts of this case based upon the existence of residency of the petitioner in New Jersey and the making of the contract in New Jersey. The court concludes that either of these are sufficient basis for jurisdiction in New Jersey. Numerous court decisions have cited authorities, which recognize six circumstances where Workers’ Compensation Acts, have successfully asserted jurisdiction to out of state injuries. Beeny v. Teleconsult, Inc., 160 N.J. Super. 22, 27 (App. Div. 1978); Wenzel v. Zantop Air Transport, Inc. 94 N. J. Super. 326, 333-34 (Cty. Ct. 1967). In 2 Larson, Law of Workmen’s Compensation, 86.10 p.368 the author states:

There are six grounds on which the applicability of the particular compensation act has been asserted; they are that the local state is the:

(1) place where the injury occurred;

(2) place of making the contract;

(3) place where the employment relationship exists or is carried out;

(4) place where the industry is localized;

(5) place where the employee resides; or

(6) place whose statute the parties expressly adopted by the contract.

When one of these falls within the local state, and some or all of the other occur in another state, a question arises whether the local state can apply its statute without being accused of denying full faith and credit of the statute of the other. As matters now stand, it seems quite clear that the state which was the Locus of any one of the first three theories - contract, injury or employment - and perhaps also the next two, employee residence and business localization - can constitutionally apply its statute if it wants to. 2 Larsen, Law of Workmen’s Compensation, 86.10 page 368.

In the circumstances of this case two of those provisions are applicable, that is, the place of making the contract and the place where the employee resides. The reason why the place of making the contract enables the application of the New Jersey Workers’ Compensation Act is that once the contract is made the act becomes a part of that contract and therefore it is appropriate to apply the New Jersey Workers’ Compensation statutes. This is true even when all of the activity under the contract is designed to be done out of state. See Gotkin v. Weinberg, 2 N.J. 305 (1949); Bowers v. American Bridge Co., 43 N.J. Super. 48 (App. Div. 1956). The place of making the contract has long been a sufficient basis for a compensation court to assert the act of its state. As stated by Judge Conford in Phillips v. Oneida Motor Freight, Inc., 163 N.J. Super. 297, 893 (App. Div. 1978):

The making of the contract in New Jersey has long been regarded as the primary basis for positing compensation jurisdiction here. . . . indeed it is clear that the making of the contract in New Jersey is sufficient of itself to vest the jurisdiction regardless of the residence of the workman, the situs of the employment relationship or the location of the accident. See Gotkin v. Weinberg, 2 N.J. 305 (1949); Bowers v. American Bridge Co., 43 N.J. Super. 48 (App. Div. 1956), aff’d. o.b. 24 N.J. 390 (1957); Rivera v. Green Giant Co., 93 N.J. Super. 6 (App. Div. 1966), aff’d o.b., 50 N.J. 284 (1967).

If New Jersey is the site of the contract then New Jersey has jurisdiction to apply its Workers’ Compensation Act. Beeny v. Teleconsult Inc., supra.

I am satisfied from the facts of this case that the contract of hire was completed in New Jersey. The offer of hire was made as a result of several phone conversations made by the employer to the petitioner in New Jersey. Petitioner’s acceptance of the offer of employment occurred when he used the bus ticket to Indiana and traveled to Indiana. See Gomez v. Federal Stevedoring Co. Inc., 5 N.J. Super. 100, 102 (App. Div. 1949); Rogan v. William J. Scully, Inc., 42 N.J. Super. 174 (App. Div. 1956); see also Dagget v. Kansas City Structural Steel Co., 334 Mo. 207, 65 S.W. 2d 1036 (Sup. Ct. 1933), cert. den. 292 U.S. 630, 54 S. Ct. 640, 78 L. Ed. 1484, (1934). In all of these cited cases the telephone call was made with an offer which was accepted by the individual and the place of that acceptance represented the place of making of the contract. As stated in Dagget, the place where the final act occurs which makes the binding contract is the place of contract.

The fact that petitioner needed to fill out some paperwork when he arrived at the place where the performance of the contract of hire was to begin, does not militate against the conclusion that the contract was completed when the petitioner accepted the offer made over the phone by the respondent. See Johnson v. Walter Kidde Constructors, Inc., 72 N.J. Super. 548, 555-56 (App. Div. 1962). The fact that the administrative details of the contract were completed in Indiana does not control where the contract was made. See Bowers v. American Bridge Co., 43 N.J. Super. 48, 54-55 (App. Div. 1956). The petitioner was sent only a one-way ticket to Indiana so Celodon intended him to stay as an employee. His initial salary as a trainee was part of the offer of employment over the phone as was his ultimate pay arrangement. It is doubtful whether petitioner would have gone to Indiana if he had not already accepted the offer of employment with Celodon. Thus, New Jersey becomes the place of making of this contract. When the contract of employment is made in New Jersey it is immaterial whether the compensable injury occurs here or elsewhere. Godkin v. Weinberg, 2 N.J. 305 (1949).

New Jersey can apply its Workers’ Compensation Act to this employment notwithstanding the fact that the contract itself provided that the Indiana Workers’ Compensation law would apply. See Gotkin v. Weinberg, supra; Parks v. Johnson’s Motor Lodge, 156 N.J. Super. 177 (App. Div. 1978); Beeny v. Teleconsult, Inc., supra. The New Jersey Supreme Court in Gotkin indicated that:

This state has the power to ordain the legal consequences that shall attach to a contract made in this state, without regard to any stipulation of the parties themselves. The common interest vindicates any incidental restraint upon the liberty of contract.

Neither the implied intention of the parties respecting the law which was to govern their contract, if there was any such, nor any express intention, as appellant asserts is contained in the contract, can vitiate the statute laws and declared public policy of this state. Gotkin v. Weinberg, supra at 308 (citations omitted).

The court in Phillips also indicated that where New Jersey did have jurisdiction to hear a case that it had jurisdiction to apply its own law rather than the foreign law. Phillips supra 163 N.J. Super. at 304.

Authorities have criticized the technical making of a contract as the basis for a jurisdiction although recognizing that New Jersey is among the states that adhere to the place of making of the contract as a basis for jurisdiction for Workers’ Compensation claims. Dean Larsen indicates this criticism as follows:

The place of contract test, when construed to depend upon the sheer formality of being physically present in the particular geographical subdivision when a signature is scrawled or a word spoken into a telephone mouthpiece, has an air of unreality about it. There is nothing in this technicality of relevance to the choice of an appropriate statute for practical compensation purposes. The strict contract view, therefore, has for some years been giving way to the more pertinent inquiry into the location of the employment relation that results from the contract. Larsen, Workers’ Compensation Desk Edition, Section 87.34.

In Phillips, the Appellate Division indicated that although an employment status presumptively begins with the state of contract, if the employee works there regularly thereafter it will be deemed to change when the employee acquires in the foreign state a fixed and nontemporary employment situs. Phillips v. Oneida Motor Freight, Inc., supra 163 N.J. Super. at 302. In Phillips, the court recognizes Larsen’s criticism and suggestion that the technical place of making the contract itself is not controlling but ultimately where the performance of the contract is carried out. In the facts of this case it might be argued that the performance of the contract changed to Indiana where trips began and ended and where petitioner stayed between trips. Yet the very nature of petitioner’s work was itinerant. There was no real situs of the employment in Indiana. He traveled all over the 48 continental states. New Jersey has recognized the place of making the contract as the basis for jurisdiction which in the circumstance of this case means that there is jurisdiction in New Jersey based upon the oral contract that was entered into in New Jersey with the acceptance by the petitioner of the contract both verbally on the phone and by picking up the ticket at the bus station and using it to go to Indiana.

Notwithstanding the above criticism of the place of contract rule, this court accepts the case law, which makes the place of making a contract a legitimate basis for jurisdiction in the circumstances of this case. Keeping in mind the criticism raised by Dean Larsen for the technical place of contract rule, however, we move to an evaluation of residence as a basis for applying the New Jersey Workers’ Compensation Act.

The cases in New Jersey have accepted the reasoning in Dean Larsen’s treatise indicating residence as one of the bases for jurisdiction of Workers’ Compensation for out of state injuries. See Wenzel v. Zantop Air Transport, Inc., supra, 94 N.J. Super. at 333-34 (Cty. Ct. 1967). The County Court in Wenzel indicated that residence alone was not a sufficient basis for jurisdiction. The court cited Dean Larsen’s indication of why residence was a sufficient basis for jurisdiction referring to Dean Larsen’s cite recording the following language:

The place of the employer’s residence, although having a real interest as a community which might have to support a disabled and uncompensated worker, has never either by judicial decision or statute been entitled to apply its statute on the strength of the residence factor alone. In combination with other tests, however, it has at times played an important part. Wenzel, supra at 334.

In Wenzel the court found that the petitioner had failed to establish he was a resident of New Jersey. The evidence in that case established only that the petitioner’s domicile was in New Jersey. It did not establish a residence but did, however, accept the premise that New Jersey might appropriately provide a forum for compensation action when more than casual employment services were performed in New Jersey together with a residency in New Jersey.

The case law in New Jersey on the question of whether residence alone is enough for jurisdiction of our Workers’ Compensation Act has progressed from this initial recognition of residence as one of the bases for jurisdiction in New Jersey. Wenzel decided in 1967 applied the residency doctrine in determining the applicability of the New Jersey Workers’ Compensation Act. In 1978 there were three decisions dealing with the issue of residency and the application of the Workers’ Compensation Act. The first was Parks v. Johnson Motor Lines, supra, where the appellate court held that New Jersey was an appropriate forum in the presence of residence and significant employment contacts. The result was unaffected by the contractual provision for the application of North Carolina law. The next case decided that year was Beeny v. Teleconsult Inc., supra. In Beeny the Appellate Division reversed a dismissal of the claim by the Worker’s Compensation Court for lack of jurisdiction. The appellate court held that where the situs of either the contract or the injury is in New Jersey, a jurisdictional basis for the application of New Jersey’s Workers’ Compensation Act exists. The court there stated that there should be a broad interpretation given to the Workers’ Compensation Act in order to ensure the accomplishment of the statutory remedial goals. The court referred to the decision in Parks where "we held New Jersey was an appropriate forum in the presence of residence and significant employment contact and that the New Jersey Workers’ Compensation Act be applied." Beeny v. Teleconsult Inc., supra, 160 N.J. Super. at 27. The court there found that the worker was a New Jersey resident and that substantial consulting work was performed at his home in New Jersey such that New Jersey did have jurisdiction to entertain the dependency claims filed on behalf of the petitioner’s widow and two daughters. The third decision in 1978 was Phillips v. Oneida Motor Freight Inc., supra. In Phillips, the court held that New Jersey might appropriately provide a forum for compensation action by a resident when more than casual employment services were performed in New Jersey. The court went on to say that "[w]hile residency of the worker is an appropriate factor to weigh in an appraisal of significant contacts with the State, its absence should not be determinative of lack of jurisdiction when all other incidents of the employment relationship are as firmly anchored in the State as those presented here." Id. at 303-04.

In Bunk v. Port Authority of New York and New Jersey, 144 N.J. 176, 181 (1996) the Supreme Court indicated that "as a resident of New Jersey, Bunk can bring his action in New Jersey." The court cited the Parks case, which had required residence in New Jersey plus significant contacts with New Jersey. Bunk, who worked in New York City, was injured in New York City. He was, however, allowed to pursue his Workers’ Compensation claim in New Jersey based upon his residency in New Jersey. The most recent decision by the Appellate Division on this issue was Connolly v. Port Authority of New York and New Jersey, 317 N.J. Super. 315 (App. Div. 1998). In Connolly the court indicated that an injury in New Jersey will trigger jurisdiction in the New Jersey compensation court where New Jersey is the place of contractor hiring. The court also stated: "The employees of New Jersey residency appears as well, to be sufficient at least where there are also some employment contacts in New Jersey for there to be jurisdiction in New Jersey." Id. at 320.

In the circumstances of this case, the petitioner as I have found is a resident of New Jersey. The petitioner was a long time resident of New Jersey. He gave his address in New Jersey on his employment application to Celodon. At all during his employment he maintained his apartment in New Jersey. There were times that he or his wife stayed with their son in South Carolina. But petitioner maintained his apartment in New Jersey during these periods. His residency never changed. Based on these facts I conclude that petitioner was a resident of New Jersey.

There were, however, no other contacts with the State of New Jersey during the employment. Nevertheless, the court is satisfied that applying the liberal construction doctrine to the facts of this case, this is an appropriate case for exercising jurisdiction of the New Jersey Workers’ Compensation Act. A foreign company who seeks out residents in New Jersey to work for them by contacting them in New Jersey should certainly not be surprised when those workers who become injured return to their place of residence. In the circumstances of this there is virtually no other place for petitioner to go after an injury unless he was to become a burden on his son. Will New Jersey require its residents to travel out to Indiana in order to pursue their Workers’ Compensation remedy in a situation such as the petitioner? The petitioner was utilizing crutches when he came to court in New Jersey. Traveling to Indiana would present a physical and economic hardship on the petitioner. The petitioner has applied for unemployment benefits and Social Security benefits in New Jersey as one would expect of a resident of New Jersey. The respondent in Indiana has refused to provide any Workers’ Compensation benefits to the petitioner having denied his claim for compensation. It appears that the Indiana Worker’s Compensation system has already denied the medical treatment petitioner has sought here.

The reasons recognized by the authorities for residence to be an appropriate exercise of the application of Workers’ Compensation by a state are applicable in the circumstances of this case. I, therefore, conclude that New Jersey’s interest in ensuring that the burden resulting from Mr. Mitchell’s work connected injury falls upon the employer rathar than the community where he resides outweighs any inconvenience to the respondent in defending this claim in New Jersey. See Dissell v. Trans World Airlines, 511 A.2d 441, 444-45 (Me. 1986). For these reasons, this court concludes that New Jersey does have jurisdiction to hear this Workers’ Compensation claim based upon the place of making of the contract in New Jersey and the residency of the petitioner in New Jersey. Of these two reasons, the court views the latter as a better reason for the exercise of jurisdiction in New Jersey.

I deny the respondent’s Motion to Dismiss and I will set this matter down for hearing to determine whether petitioner did sustain an injury which arose out of and in the course of his employment. I will allow a stenographic fee of $250 payable by the respondent.

________________________________

Fred H. Kumpf

Judge of Compensation

November 3, 2000