author: BUTZNER, Circuit Judge:

text:
    In the Matter of GENERAL STEEL TANK COMPANY, INC., Bankrupt. MERRITT-HOLLAND WELDING SUPLIES, INC., et al., Appellants, v. GENERAL STEEL TANK COMPANY, INC., Appellee.
    No. 72-2279.
    United States Court of Appeals, Fourth Circuit.
    Argued Feb. 7, 1973.
    Decided May 4, 1973.
    L. Patten Mason, Beaufort, N. C., Ellis L. Aycock, Wilmington, N. C., and John A. Mraz, Charlotte, N. C. (Wheatly & Mason, Beaufort, N. C., Stevens, Me-Ghee, Aycock, Morgan & Lennon, Wilmington, N. C., and Mraz, Aycock & Casstevens, Charlotte, N. C., on brief), for appellants.
    Hubert Humphrey, Greensboro, N. C. (McLendon, Brim, Brooks, Pierce & Daniels, Greensboro, N. C., on brief), for General Steel Tank Co., Inc.
    Larry B. Sitton, Greensboro, N. C. (Smith, Moore, Smith, Schell & Hunter, Greensboro, N. C., on brief), for Fidelity and Deposit Co. of Md.
    Before HAYNSWORTH, Chief Judge, BUTZNER, Circuit Judge, and BRYAN, District Judge.
   BUTZNER, Circuit Judge:

This appeal concerns the right of attaching creditors to seek recovery against an unindemnified surety on bonds given to release an insolvent debt- or’s property that had been attached within four months before the filing of an arrangement under Chapter XI of the Bankruptcy Act. The district court, affirming the referee, held that § 67 (a) of the Act rendered the bonds null and void, and it restrained the attaching creditors from continuing state court suits to recover from the surety the accounts owed by the debtor. Because we hold that the Act does not discharge the liability of an unindemnified surety, we vacate the judgment of the district court and remand the case for modification of the referee’s order.

Creditors of General Steel Tank Co., Inc., alleging that the company was removing its property from North Carolina, attached the property through proceedings filed in state courts. The attachments were discharged when General Steel posted bonds conditioned on its paying any judgments that might be obtained by attaching creditors but limiting liability on the bonds to the value of the property attached. Fidelity & Deposit Company of Maryland was the surety on the bonds. Within four months, General Steel filed a petition for an arrangement.

The referee found that General Steel was insolvent when the creditors secured the attachments. He declared the attachment liens and the bonds null and void, and he enjoined the attaching creditors from continuing their state court suits to subject the surety to liability.

The attaching creditors, reserving their rights against the surety, participated in the arrangement, but they also sought permission to continue their state court actions so they could establish General Steel’s liability as principal and pursue their remedies against the surety. They acknowledge that any judgments awarded by the state courts can be executed only against the surety, not against General Steel, and they are willing to have this restriction expressed in the referee’s order.

General Steel and its surety challenge the attaching creditors’ right to obtain judgments in the state courts against General Steel even for the limited purpose of subjecting the surety to liability on the bond. The Bankruptcy Act, however, does not support their contention. Continuation of state court actions to impose liability on the debt- or’s surety is a recognized procedure, and the attaching creditors’ participation in the arrangement and receipt of a fraction of the indebtedness does not bar this relief.

Section 16 of the Act provides that the discharge of a debtor shall not alter the liability of his surety. This provision rests on the premises that a discharge is personal and that it results from operation of the law, not the consent of the creditor. These principles form the background for interpreting the specific provisions of § 67(a), which pertain to a surety’s liability on a bond given to release an attachment lien. The purpose of § 67(a) is to foster the equitable distribution of the debtor’s property by preventing the creation of preferences by judicial liens, either directly, or indirectly through the interposition of a surety. Under § 67(a)(1), a lien obtained by attachment within four months before the filing of a petition for arrangement is deemed null and void if the debtor was insolvent at the time the lien was obtained. If a lien deemed null and void under § 67(a)(1) has been dissolved by a releasing bond, the transfer of property, or the creation of a lien, for the indemnification of the surety is deemed null and void under § 67(a)(2)., As a corollary to the preceding provisions, § 67(a)(3) renders property and liens affected by §§ 67(a)(1) and (2) available for the benefit of the debtor’s estate. Finally, when § 67(a)(2) nullifies the protection a surety has obtained through indemnification, § 67(a) (5) discharges the surety of his liability to the extent the indemnifying property or lien enhances the debtor’s estate.

In this case no party claims that General Steel transferred any property, or created any lien, for the indemnification of the surety. Nevertheless, the referee held, and the district court affirmed, that the policy of the Bankruptcy Act would be subverted by allowing the attaching creditors to recover a greater portion of their debts than other creditors even though the surety, not the debtor, would pay the difference. This conclusion, however, conflicts with § 16, which recognizes the legitimacy of a creditor’s recovery against a surety despite the principal’s discharge in bankruptcy. When § 67(a) is read in the light of § 16, it is apparent that allowing attaching creditors to recover a portion of their claims against a surety on a releasing bond does not contravene the policy of the Bankruptcy Act. The loss suffered by the attaching creditors is simply transferred to the surety without affecting the debtor’s estate or his other creditors.

The referee and the district court also ruled that under North Carolina law the bonds given to release the attachment were statutory forthcoming bonds that stood as a substitute for the attached property, and not payment bonds for the satisfaction of any judgments that might be obtained by the attaching creditors. They held that the Act’s nullification of the attachment liens also dissolved the bonds and discharged the liability of the surety.

The bankruptcy court’s ruling does not, we believe, give appropriate consideration to the legislative history of § 67(a). Prior to 1934, the predecessor to § 67 (a) contained no provision governing the surety’s liability when an attachment lien was discharged by a bond. Most cases held that bankruptcy did not relieve the surety of his liability, although a minority ruled that the surety was released. In 1934, Congress amended the Act to incorporate the minority view by expressly providing that the bond given to dissolve an attachment lien was null and void. Congress again amended the section in 1938, this time to substantially its present form. The 1938 amendment abolished the 1934 clause that voided all bonds when the liens underlying them were invalidated, and it replaced the clause with § 67(a)(5), which discharged only those sureties whose indemnifying transfers had been voided under § 67(a)(2). The amendment makes no reference to the distinction between forthcoming bonds and payment bonds. It classifies both types as “releasing bonds.” The intention to expand surety liability seems obvious, for otherwise there would have been no need to alter the 1934 statutory framework.

The congressional intent is made even clearer by the legislative history of the 1938 amendment. The House committee report recognized that under the amendment the surety could remain liable even when § 67(a)(1) voided the underlying lien. However, the committee noted that the credit for the value of the indemnifying property allowed by § 67(a)(5) prevents injustice to the surety. The emphasis in the House committee report on the limited nature of release granted to sureties by § 67(a)(5) provides additional support for our interpretation of § 67(a). According to the report, the provision discharging the liability of a surety applies only to “the case where a lien has been released by the furnishing of a bond, the surety of which has been indemnified.” The narrow scope of § 67(a)(5) indicates that Congress intended only a limited exception to the general rule of continued surety liability.

In sum, we conclude that the Bankruptcy Act does not discharge the liability of an unindemnified surety on a bond given to release the property of an insolvent debtor that was attached within four months before a petition for arrangement. But this holding is not to be read as conclusively imposing liability on the surety. The bankruptcy court’s adjudication of the surety’s liability ends after it determines when the attachments were given, whether the debtor was insolvent at that time, what transfers of property and liens are deemed null and void, and to what extent the liability of the surety must be discharged under the Act because of the indemnifying property and liens he must surrender for the benefit of the debtor’s estate. The surety’s liability ultimately must be decided in a forum other than the bankruptcy court, where the validity of the attachment and the effect of state law on the surety’s undertaking can be litigated. Nothing that we have written reflects on these issues. We hold only that the Bankruptcy Act did not discharge the unindemnified surety.

Accordingly, the judgment of the district court is vacated, and the ease is remanded so the referee’s order may be modified to delete the declaration that the bonds are null and void and that no recourse may be had against the surety. The injunction should be modified to permit the attaching creditors to pursue their state court actions and to bar them from executing any judgments against General Steel. The attaching creditors shall recover their costs against the Fidelity & Deposit Company of Maryland.

      . Section 302 of the Act [11 U.S.C. § 702 (1970)] makes §§ 16 and 67(a) [11 U.S.C. §§ 34 and 107(a) (1970)], with which this opinion is primarily concerned, applicable to proceedings for arrangements under Chapter XI.

      . See Manufacturers’ Finance Corp. v. Vye-Neill Co., 62 F.2d 625, 628 (1st Cir.), cert. denied, 289 U.S. 738, 53 S.Ct. 657, 77 L.Ed. 1486 (1933) ; Brown v. Four-In-One Coal Co., 286 F. 512 (6th Cir.), cert. denied, 262 U.S. 749, 43 S.Ct. 524, 67 L.Ed. 1213 (1923). Cf. Gordon v. Calhoun Motors, Inc., 222 N.C. 398, 23 S.E.2d 325 (1942). See also 1A Collier, Bankruptcy 1535 (1972) ; 4 Remington, Bankruptcy 87 (1957) ; Glenn, The Surety’s Bight to Indemnity — Effect of Principal’s Bankruptcy, 31 Yale L.J. 582, 586 (1922). Contra Morgan v. Cummings, 117 So.2d 606 (La.App.1960).

      . Goodwin & Sigel v. Boston Clothing Co., 47 R.I. 25, 129 A. 611 (1925). See 1A Collier, Bankruptcy 1527 (1972) and 4 Collier, Bankruptcy 161 (1971). Of course, the attaching creditors may recover only that portion of the indebtedness that has not been paid.

      . Section 16 of the Bankruptcy Act [11 U.S.C. § 34 (1970)1 provides:
      “The liability of a person who is a co-debtor with, or guarantor or in any manner a surety for, a bankrupt shall not be altered by the discharge of such bankrupt.”

      . 1A Collier, Bankruptcy 1523 (1972).

      . Section 67 (a) (1) of the Bankruptcy Act [11 U.S.C. § 107(a) (1) (1970) ] provides:
      “Every lien against the property of a person obtained by attachment, judgment, levy, or other legal or equitable process or proceedings within four months before the filing of a petition initiating a proceeding under this title by or against such person shall be deemed null and void (a) if at the time when such lien was obtained such person was insolvent or (b) if such lien was sought and permitted in fraud of the provisions of this title: Provided, however, That if such person is not finally adjudged a bankrupt in any proceeding under this title and if no arrangement or plan is proposed and confirmed, such lien shall be deemed reinstated with the same effect as if it had not been nullified and voided.”

      . Section 67(a) (2) of the Bankruptcy Act [11 U.S.C. § 107(a)(2) (1970)] provides :
      “If any lien deemed null and void under the provisions of paragraph (1) of this subdivision, has been dissolved by the furnishing of a bond or other obligation, the surety on which has been indemnified directly or indirectly by the transfer of or the creation of a lien upon any of the nonexempt property of a person before the filing of a petition initiating a proceeding under this title by or against him, such indemnifying transfer or lien shall also be deemed null and void: Provided, however, That if such person is not finally adjudged a bankrupt in any proceeding under this title, and if no arrangement or plan is proposed and confirmed, such transfer or lien shall be deemed reinstated with the same effect as if it had not been nullified and voided.”

      . Section 67(a)(3) of the Bankruptcy Act [11 U.S.C. § 107(a)(3) (1970)] provides:
      “The property affected by any lien deemed null and void under the provisions of paragraphs (1) and (2) of this subdivision a shall be discharged from such lien, and such property and any of the indemnifying property transferred to or for the benefit of a surety shall pass to the trustee or debtor, as the case may be, except that the court may on due notice order any such lien to be preserved for the benefit of the estate, and the court may direct such conveyance as may be proper or adequate to evidence the title thereto of the trustee or debtor, as the case may be : Provided, however, That the title of a bona-fide purchaser of such property shall be valid, but if such title is acquired otherwise than at a judicial sale held to enforce such lien, it shall be valid only to the extent of the present consideration paid for such property.”

      . Section 67 (a) (5) of the Bankruptcy Act [11 U.S.O. § 107(a) (5) (1970)] provides:
      “The liability of a surety under a releasing bond or other like obligation shall be discharged to the extent of the value of the indemnifying property recovered or the indemnifying lien nullified and voided by the trustee or debtor, or, where the property is retained pursuant to the provisions of paragraph (4) of this subdivision, to the extent of the amount paid to the trustee or debtor.”

      . See e. g. Hill v. Harding, 130 U.S. 699, 9 S.Ct. 725, 32 L.Ed. 1083 (1889) (attachment bond). Section 16 has been applied in a wide variety of other situations to permit a creditor to recover against a co-debtor, guarantor, or surety of a discharged debtor: Barrick v. Barnes, 46 Ill.App.2d 172, 196 N.E.2d 526, 527 (1964) (co-maker of a promissory note) ; Miller v. Collins, 328 Mo. 313, 40 S.W.2d 1062, 1065 (1931) (liability insurer) ; In Re Marshall Paper Co., 102 F. 872, 874 (1st Cir. 1900) (corporate officers) ; Dominion Culvert & Metal Corp. v. United States Fid. & Guar. Co., 238 S.C. 452, 120 S.E.2d 518, 521 (1961) (construction performance bond) ; Brown & Brown Coal Co. v. Antezak, 164 Mich. 110, 128 N.W. 774, 130 N.W. 305 (1910) (appeal bond). See generally 1A Collier, Bankruptcy § 16.01 et seq. (1972).

      . Williams v. United States Fid. & Guar. Co., 236 U.S. 549, 35 S.Ct. 289, 59 L.Ed. 713 (1915) ; Manufacturers’ Finance Corp. v. Vye-Neill Co., 62 F.2d 625, 628 (1st Cir.), cert. denied, 289 U.S. 738, 53 S.Ct. 657, 77 L.Ed. 1486 (1933).

      . Section 67(f) of the Bankruptcy Act of 1898, ch. 541, § 67, 30 Stat. 564.

      . See e. g. Brown v. Four-In-One Coal Co., 286 F. 512 (6th Cir.), cert. denied, 262 U.S. 749, 43 S.Ct. 524, 67 L.Ed. 1213 (1923). See also 4 Collier, Bankruptcy 157 n. 4 (1971).

      . See e. g. Republic Rubber Co. v. Foster, 95 Conn. 551, 111 A. 839 (1920). See also 4 Collier, Bankruptcy 157 n. 4 (1971).

      . From 1934 until 1938, § 67(f) of the Act read as follows:
      “That all levies, judgments, attachments, or other liens, obtained through legal proceedings against a person who is insolvent, at any time within four months prior to the filing of a petition in bankruptcy against him, and any bond which may be given to dissolve any such lien so created, shall be deemed null and void in case he is adjudged a bankrupt, and the property affected by the levy, judgment, attachment, or other lien, and any nonexempt property of his which he shall have deposited or pledged as security for such bond or to indemnify any surety thereon, shall be deemed wholly discharged and released from the same, and shall pass to the trustee. . . . ” Act of June 7, 1934, ch. 424, § 5, 48 Stat. 924 (emphasis added).

      . Act of June 22, 1938, ch. 575, § 67, 52 Stat. 875. The current wording of the section may be found in 11 U.S.C. § 107 (a) (1970) ; see notes 6-9, supra.

      . With reference to § 67(a)(2), the committee reported:
      “Section 67 (a) (2) is intended to avoid an indix'ect preference, such as may be created by the obtaining of an attachment lien against the debtor, who px-o-cures its release by furnishing a sui'ety bond and indemnifying the surety by transferring or pledging property which other-wise would pass to the trustee. Sometimes this process is carried one step further by having the surety indemnified by a relative or friend of the debtor, who in turn is indemnified by a transfer or pledge of the debtor’s property. Even though the ox-iginal lien may be dissolved by the debtor’s bankruptcy, the lienholder may nevertheless proceed on the bond and recover from the surety. In re Federal Biscuit Co., (2 Cir., 214 F. 221). The creditor thus is effectually preferred, while the surety, who has given an adequate present consideration for the transfer of the bankrupt’s property, would be entitled to retain his security. The net result to the bankrupt estate is a transfer for the purpose of effecting a preference, which cannot be set aside under any specific provision of the act. The purpose is to enable such a transfer to be set aside, and since the surety is given credit for the value of the propex-ty recovered no injustice is done to him.” H.R.Rep.No.1409, 75th Cong., 1st Sess. at 33 (1937).
      A National Bankruptcy Conference analysis of a similar bill from the preceding year provides further evidence that the 1938 amendment was intended to discharge an unindemnified surety. Speaking critically of the 1934 amendment to § 67 (f) of the Bankruptcy Act, the analysis states:
      “The section, thus amended [in 1934], is expanded to x-ender null and void ‘any bond which may be given to dissolve any such lien so created’, and ‘any nonexempt property of his (debtor) which he shall have deposited or pledged as security for such bond or to indemnify any surety thereon’ is discharged and released. This provision is unsound in that it extends beyond the purpose of protecting property of the estate. Where the obligation of the surety is covered by indemnity, consisting in part of property of a third person, it would seem px-oper to release the bond only to the extent covered by the bankrupt’s property. Thus the attaching or lien creditor would be entitled to recover from the sux-ety, and the surety would continue liable on his obligation, to the extent of the amount remaining undischarged after cx-edit is given for the value of the px-operty recovered by the tx-ustee for the estate.” National Bankruptcy Conference Analysis of H.R. 12889, Hearings on Amendments to the Bankruptcy Act of 1898 Before the House Judiciary Comm., 74th Cong., 2d Sess. at 208 (1936).

      . The section of the committee report discussing § 67 (a) (5) states :
      “Clause (5) relates only to the case where a lien has been released by the furnishing of a bond, the surety of which has been indemnified. If the transfer or indemnifying lien is set aside, the surety is obviously entitled to a proportionate credit. The court which sets aside the transfer or lien determines its value; and it is specifically provided that the obligee' on the bond, who has been given notice of the proceeding, shall be bound by this determination of value. The credit given the surety is limited to the value of the property actually recovered by the trustee or debtor or the value of the lien, if the lien is set aside, or the amount actually paid to the trustee or debtor where the proceeding is to recover money rather than to recover the property itself or to set aside the lien.”
      This comment was taken almost verbatim from the National Bankruptcy Conference analysis, which was prepared by the drafters of the 1938 amendments. See National Bankruptcy Conference Analysis of H.R. 12889, Hearings on Amendments to the Bankruptcy Act. of 1898 Before the House Judiciary Comm., 74th Cong., 2d Sess. at 210 (1936).

      . This interpretation of § 67(a) follows that suggested by the leading bankruptcy commentators:
      “[T]he lien creditor is now entitled to enforce the bond of the surety to the extent of the amount of the obligation remaining undischarged after credit is given for the value of any of the bankrupt’s nonexempt property recovered from the surety by the trustee in bankruptcy.” 4 Collier, Bankruptcy 160 (1971).
      “The state court proceedings can go forward notwithstanding avoidance of the attachment or other lien by the statute upon initiation of bankruptcy proceedings, for the purpose of determining whether there is liability on' the release bond and to enforce such liability if it is enforceable under state law.” 4 Remington, Bankruptcy 87 (1957).

        Cf. Morris Plan Bank v. Simmons, 201 Ga. 157, 39 S.E.2d 166 (1946) ; Bates Street Cigar & Confectionery Co. v. Howard Cigar Co., 137 Me. 151, 15 A.2d 190 (1940). But cf. Morgan v. Cummings, 117 So.2d 606 (La.App.1960).


source: Caselaw Access Project

author: TUTTLE, Circuit Judge: SIMPSON, Circuit Judge

license: Public Domain

text:
    Annie J. BEATY, Individually and as next friend of Franklin T. Beaty and Tracy A. Beaty, minors, Plaintiffs-Appellees-Cross-Appellants, v. Caspar W. WEINBERGER, Secretary of Health, Education and Welfare, Defendant-Appellant-Cross-Appellee.
    No. 72-1356.
    United States Court of Appeals, Fifth Circuit.
    April 23, 1973.

      John W. Stokes, Jr., U. S. Atty., Julian M. Longley, Jr., Asst. U. S. Atty., Atlanta, Ga., Stanton Koppel, Civil Div., Morton Hollander, Chief, Appellate Sec., Kathryn H. Baldwin, Civil Div., Dept, of Justice, Washington, D. C., for appellant.
    Kenneth G. Levin, Atlanta, Ga., for appellees.
    Before TUTTLE, WISDOM and SIMPSON, Circuit Judges.
   TUTTLE, Circuit Judge:

This action was brought under Section 205(g) of the Social Security Act, 42 U. S.C.A. § 405(g), for review of a final decision of the Secretary of Health, Education and Welfare, denying the claim of Annie J. Beaty, on behalf of her two illegitimate children, Franklin and Tracy, for children’s insurance benefits. The claim was based on the social security earnings record of J. B. Bryant, a disabled worker conceded by the Secretary to be the children’s natural father. Benefits were denied the children on the basis of the Secretary’s finding that neither had been dependent upon Bryant at the time his period of disability began, a prerequisite to recovery by illegitimate children under the relevant provisions of the Act. Upon review the district court held that the record would not support the Secretary’s finding of non-dependen-ey as to one of the children, Franklin, but upheld the Secretary’s determination with regard to the other child, Tracy, who had been born after the onset of Bryant’s disability. We affirm in part and reverse in part.

This claim for insurance benefits is governed by Section 202(d) of the Act, 42 U.S.C.A. § 402(d), which in pertinent part provides that “Every child (as defined in section 416(e) of this title) of an individual entitled to old-age or disability insurance benefits” who “has filed application for child’s insurance benefits,” and “was dependent upon such individual — if such individual is living, at the time such application was filed . shall be entitled to a child’s insurance benefit. . . . ”

Section 216(e) of the Act, 42 U.S.C.A. § 416(e), provides that the term “child” means the child or legally adopted child of an individual. However, in order to be eligible for social security benefits the child must qualify under one of the criteria set forth in sections 216(h)(2) or 216(h)(3) of the Act, 42 U.S.C.A. § 416(h)(2) and § 416(h)(3). Though we treat of these statutes in greater detail below, it is sufficient for our purposes here to note that in order to.'be deemed eligible for the insurance benefits which they seek, the two illegitimate children in this case were obliged to meet the requirements of 42 U.S.C.A. § 416(h) (3)(B) (ii) which provides for the recovery of benefits where “such insured individual is shown by evidence satisfactory to the Secretary to be the father of the applicant and was living with or contributing to the support of that applicant at the time such period of disability began.”

Turning to the salient facts of this case, we note the following: On September 2, 1969, Annie J. Beaty, the mother of the two illegitimate children of J. B. Bryant, applied for insurance benefits in behalf of the children based on Bryant’s earnings record. On the same day Bryant applied for disability insurance benefits and in a separate proceeding the Social Security Administration determined that Bryant had been under a disability, paranoid schizophrenia, since March 10, 1961 and awarded him benefits retroactive to September, 1968 pursuant to Section 223(b) of the Act, 42 U.S.C.A. § 423(b). Insurance benefits were denied to the children, however, on the grounds that, although Franklin and Tracy were Bryant’s natural children, Bryant had not been contributing to their support at the time his disability began in March of 1961. The hearing examiner concluded that Tracy, who had been born in 1966, could not possibly have been receiving support from Bryant, as required by statute, at the time Bryant’s period of disability began in 1961. As to Franklin, who was born in 1960, and thus was not, because of date of birth, barred by the statutory exclusion which deprived Tracy of insurance benefits, the examiner concluded that the “reliable, probative, and substantial evidence of record” did not establish the existence of support payments from Bryant before the onset of his disability. This determination became the final decision of the Secretary on December 31, 1970, and claimant brought this action in the district court for review.

As noted, the district court reversed the determination of the Secretary with regard to Franklin’s claim, but affirmed as to the denial of benefits to Tracy. In its present posture the case involves two distinct issues. Raised on direct appeal by the Secretary is the issue with regard to Franklin’s claim as to whether there was substantial evidence in the record to support the Secretary’s findings that Bryant had not been contributing to the child’s support at the time of the onset of his disability. As to the denial of benefits to Tracy, which is the subject of Ms. Beaty’s cross-appeal, the constitutional issue is raised: whether Section 416(h) (3) (B) (ii), which excludes the possibility that Tracy, born after his father’s period of disability commenced, could ever receive child’s insurance benefits on account of such disability constitutes a denial of equal protection to Tracy.

We deal initially with Franklin’s claim. Before the Social Security hearing examiner, whose findings of fact were accepted in toto by the Secretary, appellant Beaty testified that from about the time of Franklin’s birth in August, 1960, Bryant contributed approximately $10 twice each month for the child’s support. However, Bryant’s social security earnings record for 1960 disclosed income of only $331 and for 1961 of $426. In view of this fact the examiner found it unlikely that with such minimal income Bryant would have been contributing $20 per month to the support of his illegitimate child. This conclusion was based on the presupposition that the income of $331 in 1960 and of $426 in 1961 had been evenly spread over the four quarters of each of those calendar years. In point of fact Bryant’s income of $331 during 1960 had been received in the last three quarters of that year and his reported income of $426 during 1961 was all received in the first quarter. It is to be noted that Franklin was born during the third quarter of 1960. Bryant, of course, was subsequently determined to have been disabled as of March 10, 1961, and thus, for Franklin to be eligible for insurance benefits it was necessary for him to prove only that his father had been contributing to his support prior to that time. In the perspective from which we view Bryant’s earnings record for 1960 and 1961 it does not seem so unlikely as the examiner concluded that Bryant could not have contributed $20 monthly to Franklin’s support during the last four months of 1960 and certainly not unlikely that out of $426 earned during the first quarter of 1961 Bryant could not have contributed $20 per month to the child’s support — a total of $60 — until the onset of his disability in March of that year. Plainly Bryant’s .income for the months of January, February, and March, 1961 was much more than adequate for Bryant to have been making the $20 per month payments which Ms. Beaty claimed he had made.

A second basis which the government posits for denying Franklin’s claim is the putative conflict between Ms. Beaty’s testimony at the hearing and a prior written statement signed by her and considered along with the case. In filing her claim Ms. Beaty signed a statement to the effect that “Franklin Tony Beaty and Tracy A. Beaty are my children by J. B. Bryant. We have never lived together and he has not supported the children since 1957. The VA advised us to go to the court and file an acknowledgment of paternity and support agreement before we filed with the VA.” This statement had been written out by a caseworker, later identified as Helen Wilson, who also prepared a statement for J. B. Bryant (which he signed) which said in part “Franklin Tony Beaty and Tracy A1 Beaty are my children by Ms. Annie Jewel Beaty. I have never lived with her or the children and have not contributed to their support since 1957.”

Since the first of these two children was born in August, 1960, and the second in 1966, it is plain that these statements could not mean what they purport to say. One may speculate as to whether the statements were meant to refer to 1967 or some other date, but m any event it is clear that the reference to 1957 was a scrivener’s error. We note that the statements were not sworn to and, of course, neither was in the handwriting of the affiant, but rather had been written out by the same case worker.

In view of these circumstances we think that Ms. Beaty’s sworn testimony at the hearing, to the effect that Bryant had paid her approximately $10 every 2 weeks after the first child was born, together with Bryant’s affidavit to substantially the same effect, would have to prevail on the grounds that there was no substantial evidence on the record to support the hearing examiner’s findings that Bryant had not contributed to Franklin’s support prior to March 10, 1961. We, therefore, conclude that the district court’s determination in this respect was correct.

We turn then to the equal protection issue raised by Ms. Beaty on cross-appeal concerning the denial of benefits to her son Tracy. The issue arises within the framework of the following statutory scheme for awarding children’s insurance benefits. As noted, the entitling provision is 42 U.S.C.A. § 402(d)(1). In pertinent part it provides for insurance benefits to every child, as hereinafter defined, of a fully-insured individual himself entitled to disability benefits where such child has filed application for benefits and was dependent on the insured individual, if living, at the time such application was filed. In order to be eligible for benefits, however, the applicant must be a “child” or deemed a “child” within the meaning of 42 U.S.C. A. § 416(h)(2)(A) or (B) or § 416(h) (3)(B), quoted in full in the margin.

Briefly, § 416(h)(2)(A) provides that in determining whether an applicant is the “child” of an insured individual the Secretary shall apply “such law as would be applied in determining the devolution of intestate personal property by the courts of the State in which such insured individual is domiciled” at the time application is made. Under § 416(h)(2)(B) an applicant who does not meet the above requirement, but was the product of a purported marriage which “but for a legal impediment would have been a valid marriage” is deemed to be a “child” of the insured individual for purposes of eligibility for insurance benefits. Finally, § 416(h)(3)(B), which was added to the Act by amendment in 1965, provides that an otherwise illegitimate child shall be deemed to be the “child” of an insured individual for purposes of § 402 benefits where, with additional provisos not here relevant, “such insured individual is shown by evidence satisfactory to the Secretary to be the father of the applicant and was living with or contributing to the support of that applicant at the time such [the father’s] period of disability began.” 42 U.S.C.A. § 416(h) (3) (B) (ii) (Emphasis added).

Cross-appellant concedes that Tracy does not fall within any of the categories of eligibility listed above. Under Georgia law, applicable here, a child in Tracy’s position does not under the intestacy laws inherit from his natural father, as provided in § 416(h)(2)(A), nor was there a purported marriage here which might qualify Tracy under § 416(h) (2) (B). Additionally since Tracy was born nearly five years after the commencement of his father’s disability he cannot qualify under § 416(h)(3)(B) even though, as Beaty contends, Bryant, the admitted father, made and continued to make contributions to Tracy’s support following the child’s birth in 1966, long prior to the filing of any social security claim either for the father or the children.

For children such as Tracy, then, the reality of support payments from the father in no way affects their ineligibility for insurance benefits, since, under § 416(h)(3)(B), illegitimate children, in order to be eligible for benefits, must have been receiving support from the putative father at the time his disability commenced. This treatment of illegitimate, post-disability children contrasts with the treatment afforded h(2) children born after the onset of their father’s disability. Under § 402(d)(1) these children may establish their dependency on their fathers, thus making them eligible for benefits, at the time their applications for benefits are filed. Moreover, as more fully explicated hereinafter, there is a statutory presumption in § 402(d)(3) that h(2) children are dependent, thus obviating the need for any proof in that respect. The net effect of this statutory scheme is that while post-disability illegitimate children are ipso facto ineligible for benefits, their post-disability peers, who qualify under § 416(h)(2), will almost automatically be eligible. It is this disparity in treatment which Ms. Beaty contends constitutes an invidious discrimination in violation of the Due Process Clause of the Fifth Amendment.

In assessing this contention we start with the proposition that the constitutional test to be applied in these circumstances is whether the classification set up by Congress has a rational basis, Richardson v. Belcher, 404 U.S. 78, 92 S.Ct. 254, 30 L.Ed.2d 231 (1971). The Secretary argues that this rather unexacting standard has in fact been met. He notes that the purpose of the children’s insurance provisions in the Social Security Act is to replace the support lost by a child when his father dies, retires, or becomes disabled, and that Congress was of the view that children with inheritance rights under state law, or whose parents had undergone a formal marriage ceremony were more likely to have received support from their parents than other classes of children. Thus it was that, in broadening the coverage of the Act in 1965 by including children described by § 416(h)(3), Congress required that children falling within this class prove that they were likely to be or were in fact being supported by the insured parent. However, with respect to children born after the onset of their parent’s disability Congress was faced with the problem of devising tests by which fabricated claims could be excluded since, the Secretary avers, the “risk that a claimant is fabricating the evidence of parentage or support is greater when the child is not born until after the wage-earner has become entitled to benefits.” Thus, since any test which might be devised for weeding out fraudulent claims would involve additional administrative burdens, Congress might reasonably deny benefits to this class of children who are deemed less likely in any event to have lost support by a wage-earner’s disability.

It is doubtless true, as the Secretary suggests, that children’s benefits under the Act are theoretically conditioned on the loss of support from a disabled parent. In point of fact, however, so-called legitimate children have ordinarily been eligible for benefits regardless of whether the insured parent lives with them or contributes to their support. Section 402(d)(3) of the Act provides in effect that a legitimate child is presumed to be dependent on the wage-earner unless the child has been adopted by some other individual and the wage-earner no longer contributes to that child’s support. Of course, the class of children deemed to be legitimate for eligibility purposes (though technically they are illegitimate) has been broadened by amendment to include children described by § 416(h)(2)(B) and (h)(3)(B), but of all eligible children only those covered under § 416(h) (3) (B) (ii) are required to prove actual support and this only at the time the insured parent’s period of disability began and not thereafter.

The net effect of this statutory framework is that the bulk of those children who meet the eligibility criteria of § 416(h)(2) or (3)(B) would be entitled to insurance benefits on the account of a disabled parent regardless of whether they are being supported by that parent, whereas illegitimate children in Tracy’s class cannot receive benefits even though able to prove both parentage and support at any really relevant time. The Secretary seeks to rationalize this anomalous circumstance on the grounds that the classification is an administrative device for obviating the risk that claimants like Tracy will fabricate evidence of parentage and support. We think, however, that such a rationale will not withstand constitutional scrutiny.

We do not here dispute the Secretary’s underlying premise that because illegitimate children are less likely to be supported by their fathers than h(2) children — a proposition which we are inclined to accept as true — -the former might be required to establish to the satisfaction of the Secretary the entitling facts of parentage and support. Thus, it would doubtless be appropriate for Congress to require that post-disability illegitimate children prove those facts. It does not follow, however, that the entire class may be excluded from coverage simply because of a postulated difficulty of proof. This is what happens now as to all post-disability children who do not meet the h(2) requirements.

The starting point for our analysis is with the companion cases of Levy v. Louisiana, 391 U.S. 68, 88 S.Ct. 1509, 20 L.Ed.2d 436 (1967) and Glona v. American Guarantee Co., 391 U.S. 73, 88 S.Ct. 1515, 20 L.Ed.2d 441 (1967). What is significant about these cases is the Court’s implicit, if not explicit, disavowal of the notion that difficulties of proof are a sufficient, or indeed rational, basis for discriminating against illegitimates. In Glona, which involved the question whether a mother should be entitled to recover for the alleged wrongful death of her illegitimate child, the Court said, “Opening the courts to suits of this kind may conceivably be a temptation to some to assert motherhood fraudulently. That problem, however, concerns burden of proof. Where the claimant is plainly the mother, the State denies equal protection of the laws to withhold relief merely because the child, wrongfully killed, was born to her out of wedlock.” 391 U.S. at 76, 88 S.Ct. at 1517 (emphasis added). Plainly, the problem of proving parentage was viewed as a procedural matter which of itself was not sufficient justification for the State to formulate classifications between legitimates and illegitimates based upon it.

Of course, Levy and Glona both in-' volved the mother-child relationship and not, as here, the relation between father and child. That the same rule should obtain in both instances, however, was subsequently decided by the Court in Weber v. Aetna Casualty & Surety Co., 406 U.S. 164, 92 S.Ct. 1400, 31 L.Ed.2d 768 (1972). In that case the issue involved was “the right of dependent unacknowledged, illegitimate children to recover under Louisiana workmen’s compensation laws benefits for the death of their natural father on an equal footing with his dependent legitimate children,” 406 U.S. at 165, 92 S.Ct. at 1401. The Court held that the denial of equal recovery rights to the former constituted a violation of equal protection. In discussing the problems of proof, which the State apparently asserted as a basis for discriminating between the two classes of children, the Court had this to say:

“[W]e are mindful that States have frequently drawn arbitrary lines in workmen’s compensation and wrongful death statutes to facilitate potentially difficult problems of proof. Nothing in our decision would impose on state court systems a greater burden in this regard. By limiting recovery to dependents of the deceased, Louisiana substantially lessens the possible problems of locating illegitimate children and of determining uncertain claims of parenthood. Our decision fully respects Louisiana’s choice on this matter. It will not expand claimants for workmen’s compensation beyond those in a direct blood and dependency relationship with the deceased and avoids altogether diffuse questions of affection and affinity which pose difficult probative problems. Our ruling requires equality of treatment between two classes of persons the genuineness of whose claims the State might in any event be required to determine.” 406 U.S. at 175, 92 S.Ct. at 1406 (emphasis added).

Clearly the Court did not believe that proving dependency and parentage, when proof of both was necessarily a prerequisite to recovery, presented difficulties sufficient for the State to justify excluding a class of illegitimates from coverage under the workmen’s compensation laws at issue. And, the Court indicated that notwithstanding difficulties in proof, the State might in any event be obliged to determine the genuineness of the claims of illegitimate children.

This principle was reaffirmed in Gomez v. Perez, 409 U.S. 535, 93 S.Ct. 872, 35 L.Ed.2d 56 (1973) in which the Court was confronted with the question whether a State could grant legitimate children a judicially enforceable right to support from their fathers and deny that right to illegitimate children. While recognizing “the lurking problems with respect to proof of paternity” the Court noted, “those problems are not to be lightly brushed aside, but neither can they be made into an impenetrable barrier that works to shield otherwise invidious discrimination.”

Moreover, in Shapiro v. Thompson, 394 U.S. 618, 89 S.Ct. 1322, 22 L.Ed.2d 600 (1969), the Court rejected the suggestion that prevention of fraud might constitute a rational basis for a state to impose a one year residency requirement on individuals seeking welfare assistance. The Court said, “[I]t is unreasonable to accomplish this objective by the blunderbuss method of denying assistance to all indigent newcomers for an entire year.” 394 U.S. at 637, 89 S.Ct. at 1333.I ********* Though the case was decided in terms of compelling state interest, it was noted that “even under traditional equal protection tests a classification of welfare applicants according to whether they have lived in the State for one year would seem irrational and unconstitutional.” 394 U.S. at 638, 89 S.Ct. at 1333.

We conclude, therefore, that the classification at issue, which works a total exclusion of claims by a class of illegitimate children, some of whose claims would be demonstrably valid, does not pass constitutional muster. It is plain that all of the children affected by this classification are illegitimate — as contrasted to the treatment afforded legitimate children who, as noted, are almost always eligible for benefits. The sole justification offered for this difference in treatment is that there may reasonably be supposed to be a greater likelihood of spurious claims from this group than from others. Yet, as we have indicated, this justification will not insulate an otherwise invidious discrimination. We thus hold that § 416(h) (3) (B) (ii) is constitutionally infirm insofar as it requires a showing of paternity and dependency at the time the insured parent’s period of disability began. While proof of parentage and support may be required of post-disability, illegitimate children they may not as a class be excluded from coverage of the Act simply because they were born after the onset of the insured parent’s disability.

We are not unmindful that a three-judge court in Illinois recently held to the contrary. Jimenez v. Richardson, D.C.N.D.Ill., 353 F.Supp. 1356, decided January 30, 1973. That court did not consider, however, that, even though there might exist the possibility of spurious claims by post-disability, illegitimate children, that justification alone, as a constitutional matter, will not support the classification. We agree with Judge Fairchild’s dissenting opinion in which he noted that the Supreme Court [406 U.S. 164, 92 S.Ct. 1400, 31 L.Ed.2d 768] has made it clear “that once dependency was established, the Constitution required that all dependents— whether legitimate or illegitimate — must be treated equally,” and that while “the need to guard against fraudulent claims is surely a valid legislative goal,” the total exclusion of a class for claims would not be a “reasonable means of achieving that goal.”

Turning to the facts of the case before us we note that because Tracy was deemed ineligible for insurance benefits owing to the lateness of his birth, the Secretary made no finding as to whether Bryant was actually contributing to the child’s support at the time application for benefits was made. It is therefore necessary to remand the case for a factual determination with regard to this question.

We have considered Ms. Beaty’s claim that the one year retroactivity provision in the Act should not apply to Bryant and find the contention to be without merit.

The district court’s determination with respect to the issue raised on direct appeal is affirmed. With respect to the issues raised on cross-appeal, the judgment is affirmed in part and reversed in part and the case is remanded to the district court with directions to remand to the Secretary for a factual hearing in accordance with this opinion.

SIMPSON, Circuit Judge

(concurring in part and dissenting in part):

I concur fully in the majority’s af-firmance of the district court’s treatment of the claim asserted for the older child of Mrs. Beaty, Franklin: reversal of the Secretary’s determination that “reliable, probative and substantial evidence of record” did not establish the existence of support payments for Franklin’s benefit by Bryant prior to the onset of Bryant’s disability in 1961.

But I respectfully dissent from the remaining portion of the opinion which sustains Mrs. Beaty’s cross-appeal and reverses the district court’s approval of the Secretary’s denial of benefits to the younger son, Tracy, born in 1966, five years subsequent to the onset of Bryant’s disability in 1961.

I would hold that the discrepancy in treatment between h(2) and h(3) post-disability illegitimate children is rationally related to achieving legitimate Congressional goals, and that by passing this rational basis test the statutory scheme meets constitutional standards of equal protection under the Fifth Amendment Due Process Clause. Richardson v. Belcher, 1971, 404 U.S. 78, 81, 92 S.Ct. 254, 257, 30 L.Ed.2d 231, 235; Dan-dridge v. Williams, 1970, 397 U.S. 471, 90 S.Ct. 1153, 25 L.Ed.2d 491. We deal here with a federal statute which does not directly involve the Fourteenth Amendment’s Equal Protection Clause but it is clear that a classification which meets the Dmdridge equal protection test is necessarily consistent with the due process requirement of the Fifth Amendment. Richardson v. Belcher, supra; Shapiro v. Thompson, 1969, 394 U.S. 618, 641-642, 89 S.Ct. 1322, 1335, 22 L.Ed.2d 600, 619; Bolling v. Sharpe, 1954, 347 U.S. 497, 499, 74 S.Ct. 693, 694, 98 L.Ed. 884.

In upholding the constitutionality of Title 42, U.S.C. § 416(h)(3)(B), I would follow the majority opinion of the three-judge statutory court in Jimenez et al. v. Richardson, 1973, N.D.Ill., 353 F.Supp. 1356 rather than follow Judge Fairchild’s dissent as the-majority does. See also Watts v. Veneman, D.C.Cir. 1973, 476 F.2d 529 and its holding in a similar context:

“The entire thrust of the Social Security laws relevant to dependents is to provide benefits to those who were most likely to have relied upon the deceased for their support. In light of this overriding purpose, it is well-established that Social Security benefits are not accrued property rights. One’s ability to receive benefits is not dependent solely upon the biological relationship between the decedent and his children, but also upon the probability that the children were dependent for support upon the deceased.
Congress in enacting the Social Security laws made various judgments about the probability that children are dependent. For example, it seems more logical that illegitimates would be dependent upon their father if he has recognized them, or if in fact he is contributing to their support. The incorporation of a state’s intestacy laws for purposes of determining eligibility is in furtherance of this scheme. If an illegitimate child may not inherit, then the child’s support following the father’s death is less likely to be dependent upon what was received upon the deceased’s death than if the child could receive property following the wage earner’s demise.
It must be remembered that the Social Security laws do not exclude all il-legitimates from eligibility for payments. In this case, for example, the children of decedent Jones were and are fully eligible for support. Rather, the laws are reasonably designed to disqualify a class of illegitimates who are less likely, as a class, to possess the requisite biological or legal relationship to or economic dependency on the wage earner.” (Footnotes omitted)

      . The record is clear that Bryant did not live with the children. Thus, in order for the children to be eligible for benefits under § 416(h) (3) (B) (ii) it was necessary to prove that Bryant was contributing to the support of the children at the time his period of disability began.

      . Ms. Beaty’s sworn testimony was supported by an affidavit submitted by Bryant which stated that he had made periodic payments to Ms. Beaty for the support of each of the children. However, the amount and frequency of such payments were not indicated.

      . The other evidence of record which might have led the examiner to reject Ms. Beaty’s sworn testimony at the hearing, such as a statement made to the Fulton County Legal Aid Society to the effect that she had not received a payment from Bryant, is at best ambiguous. Since Ms. Beaty did not seek such legal assistance until 1963 and since she stated at the hearing that her reason for doing so was because Bryant’s payments were “kind of slow” and further since the reference to payments from Bryant made to the Legal Aid Society could as easily be interpreted as referring to a stoppage of payments as to the fact that Bryant had never made any payments, we do not consider this evidence as being of any particular significance.

      . “§ 416(h) (2) (A) In determining whether an applicant is the child or parent of a fully or currently insured individual for purposes of this subehapter, the Secretary shall apply such law as would be applied in determining the devolution of intestate personal property by the courts of the State in which such insured individual is domiciled at the time such applicant files application, or, if such insured individual is dead, by the courts of the State in which he was domiciled at the time of his death, or, if such insured individual is or was not so domiciled in any State, by the courts of the District of Columbia. Applicants who according to such law would have the same status relative to taking intestate personal property as a child or parent shall be deemed such.
      (B) If an applicant is a son or daughter of a fully or currently insured individual but is not (and is not deemed to be) the child of such insured individual under sub-paragraph (A), such applicant shall nevertheless be deemed to be the child of such insured individual if such insured individual and the mother or father, as the case 'may be, of such applicant went through a marriage ceremony resulting in a purported marriage between them which, but for a legal impediment described in the last sentence of paragraph (1)(B), would have been a valid marriage.
      (3) An applicant who is the son or daughter of a fully or currently insured individual but who is not (and is not deemed to be) the child of such insured individual under paragraph (2) of this subsection, shall nevertheless be deemed to be the child of such insured individual if: (B) in the case of an insured individual entitled to disability insurance benefits, or who was entitled to such benefits in the month preceding the first month for which he was entitled to old-age insurance benefits—
      (i) such insured individual—
      (I) has acknowledged in writing that the applicant is his son or daughter,
      (II) has been decreed by a court to be the father of the applicant, or
      (III) has been ordered by a court to contribute to the support of the applicant because the applicant is his son or daughter,
      and such acknowledgment, court decree, or court order was made before such insured individual’s most recent period of disability began; or
      (ii) such insured individual is shown by evidence satisfactory to the Secretary to be the father of the applicant and was living with or contributing to the support of that applicant at the time such period of disability began

      . Children who meet the requirements of either § 416(h) (2) (A) or § 416(h) (2) (B) will hereinafter be referred to as “h(2) children.” Though such children are sometimes loosely referred to as “legitimate” children, the appellation is not entirely accurate and thus, for purposes of clarity we will use the statutory designation.

      . See 42 U.S.C.A. § 416(h) (3) (B) (i), supra n. 4.

      . We use the term “almost automatically” because a close reading of the statute indicates that there are special circumstances set out which would exclude coverage for even an h(2) child. It is apparent that statistically this class would he negligible.

      . § 402(d) (3) provides “A child shall be deemed dependent upon his father or adopting father or his mother or adopting mother at the time specified in paragraph (1) (C) of this subsection unless, at such time, such individual was not living with or contributing to the support of such child and—
      (A) such child is neither the legitimate nor adopted child of such individual, or
      (B) such child has been adopted by some other individual.
      For purposes of this paragraph, a child deemed to be a child of a fully or currently insured individual pursuant to section 416(h) (2) (B) or section 416(h) (3) of this title shall be deemed to be the legitimate child of such individual.”

      . In support of his argument the Secretary has introduced statistics from a study of absent father families by the Department of Health, Education and Welfare which demonstrate that where the father was or had been married to the mother 18.3% of the families received contributions from the father whereas in families where the father had never been married to the mother only 10.2% received such contributions. It can, with equal accuracy, be said that of the former group fully 82% of such families did not receive support contributions from the father, yet the children would nonetheless be eligible for insurance benefits under § 402(d). It also appears, by reversing the figures in this manner, that only a slightly greater percentage of families in the latter group did not receive contributions from the father, there being a difference of just slightly more than 8%.

      . It has been suggested that in the wake of Levy v. Louisiana, 391 U.S. 68, 88 S.Ct. 1509, 20 L.Ed.2d 436 (1968) even this requirement might not hold. See Semmel, Social Security Benefits for Illegitimate Children after Levy v. Louisiana, 19 Buf.L.Rev. 289 (1970), in which the author noted, “If after Levy, such illegitimates fall within the definition of ‘child,’ may they still be denied benefits because of non-dependency when others receive them without regard to dependency? It is difficult to find a rational basis for such a distinction other than administrative difficulties of ascertaining paternity, a reason which apparently lacks constitutional weight.” at 297.

      . The opinion indicates that under the circumstances welfare fraud could have been obviated by the simple expedient of sending a letter or telegram to pertinent officials. While we do not suggest that fatherhood can so easily be established, nonetheless the problems of proof, where the alleged father is living, are not nearly so difficult as the Secretary envisions, and, of course, the burden of proof lies with the claimant. For a discussion of methods of establishing parentage, see Note, Illegitimacy : Equal Protection and How to Enjoy It, 4 Ga.L.Rev. 383 (1970).

      . We confine our decision in this case to § 416(h) (3) (B) (ii), which is the provision under which Tracy would have come, but for the lateness of his birth. We express no opinion as to the eligibility criteria set forth in § 416(h) (3) (B) (i) or elsewhere in the Act.

      . For simplicity I adopt the majority opinion's shorthand nomenclature.


author: PER CURIAM.

text:
    COMMUNICATIONS WORKERS OF AMERICA, Plaintiff-Appellee, v. UNITED TELEPHONE COMPANY OF OHIO, Defendant-Appellant.
    No. 72-2097.
    United States Court of Appeals, Sixth Circuit.
    Argued April 6, 1973.
    Decided May 15, 1973.
    James Allen Smith, Smith, Currie & Hancock, Atlanta, Ga., for defendant-appellant.
    Melvin S. Schwarzwald, Cleveland, Ohio, for plaintiff-appellee; Metzen-baum, Gaines, Finley & Stern Co., L.P.A. by Norton N. Newborn, Cleveland, Ohio, on brief.
    Before WEICK and EDWARDS, Circuit Judges and PRATT, District Judge.

       Honorable Philip Pratt, United States District Judge for the Eastern District of Michigan, Southern Division, sitting by designation.

   PER CURIAM.

The United Telephone Company appeals from a temporary injunction granted to appellee union against appellant telephone company prohibiting it from pursuing a unit clarification proceeding before the National Labor Relations Board, which proceeding the company had previously filed.

The underlying dispute concerns whether 20 clerical employees scattered through the various operations of the telephone company were or were not covered by the collective bargaining agreement. The agreement calls for arbitration of disputes over interpretations of the contract, and after the processing of a grievance in this regard and the refusal of the company to arbitrate, the union had filed suit in the District Court seeking an order from it addressed to the company requiring arbitration of the dispute and an injunction to restrain the NLRB proceeding.

The District Judge issued a temporary injunction, holding:

Although there are two forums, an accommodation between them must be achieved so that the matter can proceed in an orderly fashion. An accommodation must be reached so that valuable judicial and administrative time is not wasted. At this time, then, order must be brought to bear on the situation.

While we note that the injunctive order was addressed to the United Telephone Company and not to the National Labor Relations Board or its members, we believe that the District Judge failed to observe the import of Leedom v. Kyne, 358 U.S. 184, 79 S.Ct. 180, 3 L.Ed.2d 210 (1958), and Boire v. Greyhound Corp., 376 U.S. 473, 84 S.Ct. 894, 11 L.Ed.2d 849 (1964), as well as the implications of Carey v. Westinghouse Electric Corp., 375 U.S. 261, 84 S.Ct. 401, 11 L.Ed.2d 320 (1964).

In this latter case the Supreme Court said:

By allowing the dispute to go to arbitration its fragmentation is avoided to a substantial extent; and those conciliatory measures which Congress deemed vital to “industrial peace” (Textile Workers v. Lincoln Mills, supra [353 U.S. 448] at 455 [77 S.Ct. 912, 917, 1 L.Ed.2d 972]) and which may be dispositive of the entire dispute, are encouraged. The superior authority of the Board may be invoked at any time. Meanwhile the therapy of arbitration is brought to bear in a complicated and troubled area. Carey v. Westinghouse Electric Corp., supra 375 U.S. at 272, 84 S.Ct. at 409. (Emphasis added.)

Absent the narrow exception in Leedom v. Kyne, supra, the authority of the National Labor Relations Board in determining appropriate bargaining units should not be interfered with by the in-junctive process, even for the laudable purposes described by the District Judge.

The judgment of the District Court is reversed and the case is remanded to that court for further proceedings not inconsistent with this opinion.


text:
    Samuel C. and Clare H. LOVENTHAL, Plaintiffs-Appellants, v. UNITED STATES of America, Defendant-Appellee.
    No. 72-1993.
    United States Court of Appeals, Sixth Circuit.
    Argued April 9, 1973.
    Decided May 8, 1973.

      H. Stennis Little, Jr., Nashville, Tenn., for plaintiffs-appéllants.
    Gordon S. Gilman, Atty., Tax Div., Dept, of Justice, for defendant-appellee; Scott P. Crampton, Asst. Atty. Gen., Meyer Rothwacks, Leonard J. Henzke, Jr., Attys., Tax Div., Dept, of Justice, Washington, D. C., on brief; Charles H. Anderson, U. S. Atty., of counsel.
    Before PHILLIPS, Chief Judge, LIVELY, Circuit Judge, and O’SULLIVAN, Senior Circuit Judge.
   PER CURIAM.

The taxpayers appeal from the judgment of the district court which denied their claim for refund of income taxes which they asserted were erroneously assessed and collected. The controversy arose out of the guarantee by Samuel C. Loventhal, who was an employee of Lo-venthal Brothers, Inc., of a debt of another corporation in which he was a shareholder, but from which he received no compensation. The debtor corporation became insolvent and the taxpayer was required to pay a portion of its debts and he claimed the amount thus paid as a business bad debt under Section 166(a) of the Internal Revenue Code of 1954. The Internal Revenue Service maintained that the payment was a non-business bad debt under Section 166(d) of the Code and assessed deficiencies for the year 1967.

An examination of the entire record, including the transcript of the hearing in the district court, depositions and stipulations, together with the briefs and oral arguments has convinced this Court that the dominant motivation of Samuel C. Loventhal in guaranteeing the debts of Old Hickory Construction Company, Inc. was to enhance his position as an investor in Loventhal Brothers, Inc. and Old Hickory Construction Company, Inc. rather than to protect or enhance his position as an employee of either corporation. The findings and conclusions contained in the Memorandum of District Judge L. Clure Morton dated June 29, 1972 and reported in 346 F.Supp. 1318 (1972), are fully supported by the record. See also Estate of Martha M. Byers et al. v. Commissioper of Internal Revenue, 472 F.2d 590 (6th Cir. 1973).

The judgment of the district court is affirmed.


author: ROSENN, Circuit Judge. ADAMS, Circuit Judge

text:
    Fred GREEN, Administrator of the Estate of James Henry Bruno, a/k/a Jaime Perez Bruno, Deceased, Appel-ant, v. Frank PARISI, Individually and as trustee for Dorothea Parisi et al. Fred GREEN, Administrator of the Estate of James Henry Bruno, a/k/a Jaime Perez Bruno, Deceased, Appellant, v. PHILADELPHIA GAS WORKS DIVISION OF the UNITED GAS IMPROVEMENT COMPANY.
    Nos. 71-2173, 71-2174.
    United States Court of Appeals, Third Circuit.
    Argued Jan. 15, 1973.
    Decided May 1, 1973.

      Gordon W. Gerber, Deehert, Price & Rhoads, Philadelphia, Pa., for appellant.
    James M. Marsh, John M. Fitzpatrick, Richard M. Rosenbleeth, Blank, Rome, Klaus & Comisky, Walter J. Timby, Jr., LaBrun & Doak, Philadephia, Pa., for appellees.
    Before ADAMS, ROSENN and HUNTER, Circuit Judges.
   OPINION OF THE COURT

ROSENN, Circuit Judge.

These two consolidated appeals brought by Fred Green, administrator of the estate of James Henry Bruno, seek reversal of the judgments of the United States District Court for the Eastern District of Pennsylvania entered in favor of the three appellees — the Philadelphia Gas Works, Frank Parisi and John DeMarco. Bruno died from serious burns suffered in an unfortunate explosion and fire occurring when he struck a match to light a gas burner in the kitchen of his rented home in Philadelphia.

Green brought suit under the Pennsylvania wrongful death and survivor statutes against the Philadelphia Gas Works, as supplier of natural gas to the Bruno home, Parisi, Bruno’s landlord, and DeMarco, Parisi’s real estate agent. Federal jurisdiction was based on diversity, and Pennsylvania substantive law applies. After a bifurcated trial, the jury returned verdicts in favor of all defendants. We have considered all trial errors alleged by appellant, and, finding them without merit, affirm the judgments of the district court.

At trial, two different theories of the cause of the explosion and fire were presented. Plaintiff’s theory was that a natural gas leak in the connector pipe of the Brunos’ gas range caused the conflagration. Plaintiff attempted to demonstrate that the negligence of the three appellees caused the gas leak. Defendants’ theory, on the other hand, was that the explosion was caused by the existence in the kitchen of gasoline, which Bruno had been using to clean automobile parts. Alternatively, defendants contended, if the explosion had been caused by a natural gas leak, the decedent had assumed the risk of such an occurrence.

Appellant’s primary contention of trial error is that, in the absence of any evidence indicating that decedent Bruno was aware of the dangers of a gas leak, the jury should not have been instructed that it could find he had assumed the risk of an explosion. Appellant emphasizes that there is no evidence in the record indicating that decedent was aware of the dangerousness of gas leaks or the existence of a foul smelling gas odor in his home, or, even if he was aware of the odor, that he knew it was natural gas which had explosive combustion potentialities. Appellant points out that Bruno was Puerto Rican, spoke only Spanish, and was not shown to have any special scientific expertise.

Appellees argue that the danger of gas leaks is an ordinary risk appreciated by the community in general, and that the jury was properly allowed to infer that Bruno was aware of the gas smell and of the accompanying risk. They point to the evidence at trial that other members of the Bruno family had smelled gas while living in the house for three months prior to the explosion. They emphasize that Bruno, a 37 year old man, had lived in the United States for fifteen years, was employed as a machinist, and was an amateur automobile mechanic.

The court’s instruction to the jury on assumption of risk was:

If you find that Mr. Bruno subjectively knew, that is actually knew that there was the risk of an explosion or of a fire being caused by leaking gas, if he attempted to light the stove, but that nevertheless being aware of an obvious danger, took or assumed the risk of the explosion, and by so doing brought about the injury to himself, even though the precise extent of the injuries might not have been anticipated or known to him, he may not recover.
Assumption of risk, however, relates to a subjective awareness by the plaintiff of a perceptible risk of harm. I advise you, however, that both the possible defenses of contributory negligence and assumption of risk are what are known as affirmative defenses and as such the defendant has the burden of proof on those issues. That is the defendant or defendants asserting such a defense must prove by a preponderance of the evidence that Mr. Bruno himself was eontribu-torily negligent, as I have defined this term to you, or being aware of the risk of harm voluntarily assumed the risk of harm, and that such contributory negligence or assumption of the risk contributed to the happening of the accident in a proximate way.
I further advise you that there is a presumption in law that a decedent was using due care at the time of his death and that he did not negligently or voluntarily bring about his own death, and that he took all normal and reasonable precautions to protect and preserve his life. Thus in the absence of substantive evidence to the contrary which overcomes by a preponderance of the evidence the presumption that the decedent was not con-tributorily negligent, this presumption would prevail and you would be justified in finding that the decedent was not contributorily negligent and that he did not voluntarily assume the risk of harm.

The charge is based on the principles stated in Restatement of Torts 2d § 496 (1965). There is no dispute among the parties that the charge correctly stated the principles that assumption of risk depends on the subjective state of mind of decedent, that the burden of proving assumption of risk is on defendant, and that because of the presumption of due care given deceased persons, assumption of risk cannot be found unless there was substantive evidence rebutting due care. The dispute, therefore, is whether such substantive evidence existed to properly warrant the instruction given to the jury.

”§inee assumption of risk relates to the subjective awareness by a party of a perceptible risk of harm, direct proof of it is exceedingly difficult. Evidence that a party assumed a risk may, however, be inferred from surrounding circumstances; there need not be actual proof that he knew, understood or appreciated the risk. Restatement of Torts 2d § 496D, Comment (d) (1965); Schentzel v. Philadelphia National League Club, 173 Pa.Super. 179, 96 A.2d 181, 186-187 (1953). In Schentzel, there was no direct evidence that plaintiff, a 47 year old woman, knew that baseball players hit foul balls which go astray and may injure spectators. The court, nonetheless, reversed a judgment in her favor, finding she must have assumed such a risk, because “she must be presumed to have been cognizant of the ‘neighborhood knowledge’ with which individuals living in organized society are normally equipped.” 96 A.2d at 186.

Although most cases in which courts have allowed juries to infer knowledge of a dangerous risk have involved plaintiff spectators at, or participants in, sporting events, see Restatement of Torts 2d App. § 496D, Comment (d); 149 A.L.R. 1174, 1177-1179; 142 A.L.R. 868, 874-877; 138 A.L.R. 540, 554-556; Watson v. Zanotti Motor Co., 219 Pa.Super. 96, 280 A.2d 670 (1971); the doctrine need not be limited to such cases. Juries have been allowed to draw inferences about the subjective knowledge of plaintiffs in products liability suits. In Green v. Sanitary Scale Co., 431 F.2d 371 (3d Cir. 1970), plaintiff was injured when his hand was drawn into a meat grinding machine. The district court refused to instruct on assumption of risk because plaintiff had testified that although he recognized the danger of putting his hand into the machine’s gears, he was not aware of the danger involved in using his hand, instead of an aluminum stomper, to push the meat into hopper. We reversed, stating:

[I]n view of Green’s testimony that he clearly understood the risk of putting his hand into the gear, it was for the jury to decide whether or not he must also have understood the obvious danger of placing his fingers too close to the gear, and also how far, in fact, he voluntarily put his fingers into the grinder before attempting to withdraw them. We would usurp the traditionally broad discretion of juries to apply their common sense were we to declare that a jury which has heard a party testify that he knew the danger of putting his hand in a moving gear was barred from drawing the inference that he also knew there was a risk in putting his hand too close to the gear, simply because he had not acknowledged that he was expressly aware of that extent of the risk.

431 F.2d at 374. See also Bartekewich v. Billinger, 432 Pa. 351, 247 A.2d 603, 606 (1968); Dorsey v. Yoder Co., 331 F.Supp. 753, 765-767 (E.D.Pa.1971) (although no assumption of risk was found, the issue was decided by the jury).

In the present case, there was evidence from which the jury could have concluded that Bruno was aware of the danger of leaking gas. Other members of his family had smelled the leaking gas and had been disturbed by it during their three month residence. It is a reasonable inference that the head of the family was also aware of the gas in his home and its dangerous propensities. *****8 It was not necessary for the jurors to recognize a general community knowledge that leaking gas is dangerous in order to infer Bruno’s knowledge; the inference could have been based on the knowledge and reactions of Bruno’s own family. If the jury did rely on community knowledge, however, that would not have been error. The cases emphasize that the jury is to apply its own common sense when knowledge of a risk is widely known and appreciated. The dangers of leaking natural gas in a home would seem such a widely known risk.

Appellant argues that this court refused to allow juries to make inferences as to a plaintiff’s knowledge of a risk when it affirmed the decision in Hennigan v. Atlantic Refining Co., 282 F.Supp. 667 (E.D.Pa.1967), aff’d per curiam, 400 F.2d 857 (3d Cir. 1968). In Hennigan, three workmen were killed by an explosion in a tunnel in which they were constructing a sewer. The cause of the explosion was established at trial to have been ignition of fumes, coming from crude oil which had leaked from a tank farm into the area of the tunnel, by sparks from various equipment in the tunnel. Special interrogatories were submitted to the jury asking it to determine whether the decedents had assumed the risk of the explosion. Upon various motions for judgment notwithstanding the verdict, the trial judge sustained the jury finding of no assumption of risk. In so doing, he said:

While the workmen may have smelled gas fumes and known that they became lightheaded or nauseous from working in the tunnel, there was no evidence that they knew or should have known (a) that the vapors were at or near the explosive limit; (b) that a random spark from any source could cause a flash fire and explosion, and (c) that the equipment being used was likely to create such a spark.

282 F.Supp. at 682.

The trial judge in Hennigan stated that if any error was made, it was in even allowing the jury to consider the assumption of risk issue. His statement that there was not sufficient evidence of the subjective states of mind of decedents to submit the issue to the jury was, however, dicta, as the issue had been submitted. Even this dicta does not conflict with the general principle that a jury will be allowed to infer knowledge of a risk. The only evidence presented in Hennigan bearing on decedents’ mental state was that there was an odor of petroleum in the tunnel. There was no evidence that any man in the tunnel was aware, nor any general community knowledge for the court to take judicial notice of, that petroleum fumes in such circumstances were dangerous. In the present case, other residents of the Bruno household expressed an awareness of the danger of the leaking gas, and. it is general community knowledge that gas leaking in a home is dangerous.

The district court was therefore correct in instructing the jury that it should not find appellees liable if it found Bruno had assumed the risk of lighting a match near leaking gas.

Appellant’s second contention is that the jury should have been told explicitly that the Philadelphia Gas Works was negligent when it turned on the gas at the Bruno home if its employees had not followed company procedures. He contends the company manual, “Specifications for the Installation of Gas Piping and Domestic Appliances,” which was in evidence, imposed a duty on the employees to follow certain procedures to check for gas leaks. This contention is without merit.

The evidence at trial disclosed that the manual referred to by appellant was for use of plumbers and appliance installers, not company servicemen. Because they lacked the familiarity with gas lines which company servicemen had, plumbers and appliance installers were instructed to complete slightly different and more extensive tests for gas leaks. It does not necessarily follow, therefore, that the failure of the Gas Works employee who turned on the Bru-nos’ gas to follow the procedures in the “Specifications for the Installation of Gas Piping and Domestic Appliances” manual constituted negligence. The absence of an explicit reference in the instructions to the jury to this manual was therefore not error. The judge did instruct:

If the Gas Company . . . is in possession of facts which should reasonably inform it that it is unsafe, it then becomes the Gas Company’s duty to investigate the safety of the pipe before it continues to use it for the transportation of gas.

And, further:

But the Company knows that it is dealing with a dangerous agency, and if it knows or should have known that the customer’s lines are not safe, it is then its duty to require the lines to be repaired or else shut off the gas. [Emphasis added.]

By telling the jury that the gas company is liable for repairing the gas line if it “should have known” of an unsafe gas line, the court properly instructed on the company’s duty to police its lines. It was for plaintiffs to convince the jury that this duty was neglected when Bruno’s gas was turned on.

Appellant’s other contentions — (a) that he should have been allowed to read into evidence Interrogatory No. 10 and the answer of the Philadelphia Gas Works; (b) that the opinion testimony of Lt. William Shirar of the fire department, that the fire and explosion were “probably” caused by ignition of gasoline fumes, rather than of leaking gas, should have been ruled inadmissible; and (e) that errors were committed in the court’s determination of what exhibits could be taken to the jury room — are all properly disposed of in the district court opinion. 333 F.Supp. at 1404-1407. We find the contentions without merit.

The judgments of the district court will be affirmed.

ADAMS, Circuit Judge

(dissenting):

In this case, in which a 37 year old Puerto Rican American was killed by an explosion while lighting his gas stove, the defendants interposed the defense of assumption of risk. Since this is a diversity action, the law of Pennsylvania controls. Under Pennsylvania law the defense of assumption of risk is an affirmative one, and the burden of proof is on the party asserting it. The applicability of the assumption of risk defense depends upon the subjective knowledge of the injured party.

Under these precepts, the defendants, to establish assumption of risk by the decedent, were required to demonstrate that Mr. Bruno placed himself in a position of danger, knowing full well that he was doing so. To prove this factual predicate, the defendants had to show (1) that Mr. Bruno knew there was a gas leak in the area where he sought to light the gas, and (2) that striking a match under such circumstances was dangerous.

Although there was testimony that members of the Bruno household knew of the gas leak for some time, there was not one shred of evidence that Mr. Bruno was subjectively a ware of the presence of any such leak. No testimony was adduced at trial that Mr. Bruno had been told about the gas leak by his family, or that he had talked to others about it, or that he had attempted to have the leak fixed. The absence of any evidence indicating that Mr. Bruno personally was aware of the gas leak is a fatal flaw in the defendants’ assertion that Mr. Bruno assumed the risk of the explosion that killed him.

It would appear that the general rule requiring the defendants to prove by-substantive evidence the injured party’s subjective knowledge of the facts creating the risk of harm precludes permitting the jury to infer that Mr. Bruno was aware of the gas leak merely because others in the household smelled the gas.

To fill this evidentiary gap, the majority cites cases in which various courts were faced with determining whether the injured party appreciated the risk of harm involved, the second element in the defense of assumption of risk. That issue would correspond in the present case to whether Mr. Bruno knew that lighting a match in the presence of a natural gas leak is dangerous. It would not correspond to the first element in the assumption of risk defense, whether Mr. Bruno was aware of the gas leak. None of these cases, then, except perhaps Schentzel v. Philadelphia National League Club, which we shall discuss separately, presented a problem concerning the injured party’s subjective awareness of the facts creating the danger.

The majority also relies upon Comment (d), Restatement (Second) of Torts § 496(D) (1965). That Comment, however, deals with whether the plaintiff’s testimony concerning what he knew and understood is conclusive, not whether the jury may be permitted to infer what the plaintiff knew. In addition, the commentator is referring to the plaintiff’s appreciation of' the risk of harm, not his knowledge of the facts creating the danger.

As to the Schentzel case, although it is not clear whether the court was discussing the plaintiff’s awareness of the facts creating the danger or her appreciation of the risk of harm, ample evidence may have existed for the jury to infer that Mrs. Schentzel was aware of the facts creating the hazards. The Pennsylvania Superior Court stated:

“It strains our collective imagination to visualize the situation of the wife of a man obviously interested in [baseball], whose children view the games on the home television set, and who lives in a metropolitan community, so far removed from [the knowledge that baseball spectators might be hit by foul balls] as not to be chargeable with it.” 96 A.2d at 186.

Even assuming, however, that the Schentzel court would permit the jury to infer that Mrs. Schentzel was aware that baseballs were sometimes hit into the stands merely because the community generally possesses such knowledge, such ruling should be limited either to the facts of that particular case or to cases involving plaintiffs who are spectators at, or participants in, sporting events. Although the majority opinion states that “the doctrine need not be limited to such eases,” the citations to support this contention would appear to be inapposite, as indicated in the margin. See note 5, supra. In addition, the Schentzel court itself relied exclusively upon “sports” eases, and Dean Prosser, for example, when discussing the doctrine followed in Schentzel adheres to this same pattern of examining the principle in the context of athletic contests.

Moreover, assuming that Schentzel stands for the proposition for which it is cited by the majority — that the jury should be allowed to infer that the injured party knew the facts creating the danger merely because others do — limiting such a rule to the facts of that case or generally to cases involving sporting events is supported by logical and practical considerations.

The basic effect of the Schentzel court’s opinion was to place upon the plaintiff, at a minimum, the burden of going forward with evidence that she either had poor eyesight or was unaware that baseballs are hit into the stands. Such a result is not unreasonable in view of the facts of that case. Whether Mrs. Schentzel was aware of the facts creating the risk of harm is a question touching upon her visual ability. She had attended a baseball game, which would seem fairly to suggest that she possessed at least adequate eyesight, and the court and jury could easily determine from in-court observation whether she had inadequate eyesight.

Also, to the extent that Schentzel may be thought to alter the rule that the assumption of risk depends upon the injured party’s subjective knowledge, it should perhaps be viewed in light of the court’s obvious unwillingness to believe that Mrs. Schentzel did not know that baseballs are hit into the stands and its willingness, under these circumstances, to place upon her, a living, injured plaintiff who knew best what she can and did see, the burden of showing that she was unaware of the facts creating the danger. And, the alternative of placing such a burden upon the defendant may be considered unwise when the result would, in practical terms, mean that proprietors of sports establishments in order to limit their liability would then have to ask each entering patron whether he had ever witnessed such an event, and if not, whether he was aware of the facts creating the risk of harm.

In the present case, unlike the situation in Schentzel, whether Mr. Bruno was aware of the gas leak depends upon his olfactory, not visual, ability. Nothing in the present case remotely suggests that he must have had an adequate sense of smell, and, because he was killed by the explosion, neither the court nor the jury was able to observe Mr. Bruno. Placing upon the plaintiff the burden of showing that Mr. Bruno did not have an adequate sense of smell or did not smell the gas would seem to be unjustified when, as here, the plaintiff is not the injured party, but an administrator who may not possess any more information than the defendants concerning the decedent’s knowledge of the facts creating the danger.

It would not appear inappropriate, under these circumstances, to require the defendants, in order to have the assumption of risk issue submitted to the jury, to adduce some evidence concerning Mr. Bruno’s subjective knowledge of the gas leak in his kitchen. The alternative which the majority apparently adopts here is to impose upon the plaintiff the burden of showing that the decedent had a deficient olfactory capacity. This result might well undermine the principle, followed by the Pennsylvania courts, that the defendants have the burden of proving this affirmative defense.

For the above reasons, I would reverse the judgments of the district court and remand for a new trial.

      . The district court opinion denying a motion for a new trial is reported at 333 F.Supp. 1398 (E.D.Pa.1971).

      . Unlike the dissent, we have no problem with the submission to the jury under appropriate instructions of the question of whether Bruno was aware of the leaking gas. Trial testimony indicated that Mrs. Bruno, her mother, her brother, and a close friend had smelled gas in the house for about three months, from August 13 to November 5, with the smell being strongest in the kitchen. The record shows that Bruno’s family was disturbed by it and was apparently aware of its dangers. Although there was no direct evidence that Bruno was aware of the gas smell, the jury could have inferred from the circumstantial evidence that Bruno, as head of the house, was also aware of it either because (1) he too smelled it, or (2) members of his family, since they were aware of its presence and were disturbed by it, told him about it.
      Under Pennsylvania law, the burden to present an issue of fact to the jury may be fulfilled entirely by circumstantial evidence from which reasonable inferences are deducible. Hines v. Fanti, 374 Pa. 254, 97 A.2d 808 (1953) ; Smith v. Bell Telephone Co. of Pennsylvania, 397 Pa. 134, 153 A.2d 477 (1959) ; Weidemoyer v. Swartz, 407 Pa. 282, 180 A.2d 19 (1962). Circumstantial evidence of Bruno’s knowledge was presented at trial here; we are unable to say that it would not have been a reasonable inference for jurors to determine that Bruno was aware of the gas smell. The dissent seems to suggest that defendants failed to meet the production burden because they did not elicit testimony from the witnesses that Bruno had been told of, or had acknowledged smelling, the gas. Such direct evidence of his awareness was not necessary to constitute a jury question, although its absence could certainly have been argued to the jury.

      . The defendants asserted the assumption of risk defense in the face of the plaintiff’s theory that a natural gas leak caused the explosion. Defendants also offered the theory that the explosion was caused not by a natural gas leak but by gasoline which Mr. Bruno was using to clean automobile parts.

      . Cummings v. Borough of Nazareth, 427 Pa. 14, 233 A.2d 874 (1967) ; Whitley v. Philadelphia Transp. Co., 211 Pa. Super. 288, 234 A.2d 922 (1967) ; Restatement (Second) of Torts § 469D, comment c (1965).

      . Restatement (Second) of Torts § 469D, comment b (1965).

      . Id. See Colosimo v. May Dept. Store Co., 325 F.Supp. 609, 611 (W.D.Pa.1971), rev’d on other grounds, 466 F.2d 1234 (3d Cir. 1972) ; Stark v. Lehigh Foundries, Inc., 388 Pa. 1, 130 A.2d 123, 127-128 (1957) ; cf. Whitley v. Philadelphia Transp. Co., 211 Pa.Super. 288, 234 A.2d 922 (1967).

      . In Green v. Sanitary Scale Co., 431 F.2d 371 (3d Cir. 1970), the plaintiff was aware of the facts creating the risk of harm to him ; the principal question faced by this Court was whether he appreciated one danger (“placing his fingers too close to the gear”) as opposed to a different danger (“putting his hand into the gear”). Bartekewich v. Billinger, 432 Pa. 351, 247 A.2d 603 (1968), was a products liability case under § 402A of Restatement (Second) of Torts, in which it was necessary to determine whether the defendant’s glass-breaking machine was defectively designed. The court inquired into whether the defendant should have foreseen the possibility that workers might place themselves in “an obviously dangerous position.” Id. at 606. It did so, however, only for the purpose of deciding whether the defendant violated § 402A (whether this was the kind of risk he should have guarded against), and not for determining whether he could properly defend on an assumption of risk theory.
      The court in Dorsey v. Yoder Co., 331 F.Supp. 753 (E.D.Pa.1971) (products liability) focused upon whether the plaintiff “appreciated the risk of his actions.” Id. at 765. There was no question that the plaintiff “knew about the existence of a danger. ...” Id.

      Similarly, in Hennigan v. Atlantic Refining Co., 282 F.Supp. 667 (E.D.Pa. 1967), aff’d per curiam, 400 F.2d 857 (3d Cir. 1968), the trial judge discussed only the absence of evidence that the plaintiffs “appreciate [d] the danger itself and the nature, character and extent which made it unreasonable. . . . ’ ” Id., quoting Restatement (Second) of Torts, § 496(d), Comment (b) (1965).
      In Watson v. Zanotti Motor Co., 219 Pa.Super. 96, 280 A.2d 670 (1971), the lower court dismissed the complaint on the ground that the plaintiff must have known of the obvious dangers of snowmobiles and therefore, had assumed the risk as a matter of law. The Superior Court reversed because “in the procedural posture of this case the allegations in the complaint that appellant knew nothing about snowmobiles or the presence of the ice patches must be taken as true.” Id. at 672. Under these circumstances, the case would not appear to lend support to the proposition for which it is cited by the majority.

      . 173 Pa.Super. 179, 96 A.2d 181, 186-187 (1953).

      . Restatement (Second) of Torts § 496 (D) Comment (d) (1965).

      . See W. Prosser, Law of Torts 460, 463 & n. 9 (3d ed. 1964). It is also interesting to note that Professor Prosser appears to discuss the doctrine in the context of whether the injured party appreciates the danger, not whether he knew the facts creating the danger.
      “Implied assumption of risk has been found in a variety of cases. By entering freely and voluntarily into any relation or situation which presents obvious danger, the plaintiff may be taken to accept it. . . . Thus those who participate or sit as spectators at sports or amusements may be taken to assume all the known risks of being hurt. .
      “On the same basis, plaintiffs who enter business premises as invitees and discover dangerous conditions may be found to assume the risk when they nevertheless proceed to encounter them. The guest who accepts a ride with an automobile driver may assume the risk of his known incompetence . . . or of known defects in the car. Likewise the user of a product supplied to him may assume the risks of its known dangerous defects.” Id., at 459-461 (emphasis supplied, footnotes omitted).
      It is significant that the above discussion by Dean Prosser occurs under the heading “Implied Acceptance of Risk” and not under the next heading of his treatise which is entitled “Knowledge of Risk.”

      . It may be pertinent, though not squarely on point, that in a wrongful death action Pennsylvania law creates a presumption that the decedent exercised due care. See Laubach v. Haigh, 433 Pa. 487, 252 A.2d 682 (1969) ; Bragdon, Admr. v. Pittsburgh Railways Co., 375 Pa. 307, 100 A.2d 378 (1953). Although this rule would seem to apply more logically to the defense of contributory negligence, than to the typical assumption of risk defense, it may be thought to reflect a general principle of not placing the burden of proof On similar issues upon the party representing the decedent’s interest.

      . See Ingersoll v. Onondaga Ilockey Club, 245 App.Div. 137, 281 N.Y.S. 505.

      . Of. note S supra and accompanying text.

      . Sarne v. Baltimore & O. R. Co., 370 Pa. 82, 87 A.2d 264, 270 (1952).

      . A new trial would be necessary since the jury in finding for the defendants may have done so because of the theory that the explosion was caused by gasoline Mr. Bruno had been using to clean automobile parts, see note 1, supra, and not because they accepted the defendants’ assumption of risk theory.