In 1917 and while appellant was in the United States military service, he was insured under a war risk insurance policy. By a United States District Court judgment entered November 2nd, 1927, he was adjudged “totally and permanently disabled” from and after May, 1918, and pursuant thereto a lump sum of money was paid him and thereafter he received monthly installments of money under the terms of the policy until February, 1936. On such date the government ceased such payments because it held that appellant was no longer “totally and permanently disabled”. Thereafter appellant brought suit in the United States District Court under and pursuant to § 19, World War Veterans’ Act, as amended, 38 U.S.C.A. § 445, alleging in effect that he had not recovered from his disabilities and that from the date of the above referred to judgment he had continuously remained “totally and permanently disabled”. The case was tried to a jury and resulted in a verdict for the government. Thereafter appellant made a motion for a new trial, which the court denied, and appellant then prosecuted this appeal from the judgment as entered pursuant to the verdict.
(I shall refer to the last mentioned action, the trial thereof, and the judgment entered therein, as the second action, second trial, and the second judgment, respectively.)
It will aid in the ready, understanding of the main problem in the case if at the outset it be noted that the phrase “totally and permanently disabled” as used in the statute has a technical meaning quite different from its literal meaning. It does not necessarily mean that the insured, when declared to be totally and permanently disabled, is completely and irretrievably disabled for the rest of his life.
Acting under the authority of § 13 of the War Risk Insurance Act, 40 Stat. 399 (reenacted as Sec. 5 of the World War Veterans’ Act, as amended July 3, 1930, 40 Stat. 991, 38 U.S.C.A. § 426) the Secretary of the Treasury propounded Treasury Decision 20 (March 9, 1918), defining or explaining the phrase as follows:
“Any impairment of mind or body which renders it impossible for the d-is*138abled person to follow continuously any substantially gainful occupation shall be deemed, in Articles III and IV, to be total disability.
“Total disability shall be deemed to be permanent whenever it is found upon conditions which render it reasonably certain that it will continue through life of the person suffering from it.”
The same decision also contained the following: “Whenever it shall be established that any person to whom any installment of insurance has been paid as provided in Article IV on the ground that the insured has become totally and permanently disabled, has recovered the ability to continuously follow any substantially gainful occupation, the payment of installment of insurance shall be discontinued forthwith and no further installments thereof shall be - paid so long as such recovered ability shall continue.”
Cf., U. S. v. Hartley, 9 Cir., 99 F.2d 923, November 15, 1938; U. S. v. Hill, 9 Cir., 99 F.2d 755, November 7, 1938; Kontovich v. U. S., 6 Cir., 1938, 99 F.2d 661, and cases collated therein.
As we have seen, those having in charge the administration of the World War Veterans’ Act, having “established” that appellant had recovered his health sufficiently to enable him to follow “a substantially gainful occupation”, discontinued the payment of insurance installments, and appellant brought the second action.
In the course of the trial thereof the judge presiding overruled objections to the introduction of evidence as to work done by appellant prior to the first judgment, and appellant assigns such ruling and the subsequent introduction of such evidence as reversible error. Before the submission of the cause to the jury appellant also moved the court to strike such evidence from the record.
The motion to strike was. as follows: “I (appellant’s attorney) move to strike all the testimony of this witness on the ground * * * that it was prior to-the date of the verdict in the previous trial and is immaterial to prove any issue in this case.”
The objection to such testimony was that it was not material, that it related to a time prior to the verdict in the former suit, and that its purpose was and its effect was to impeach the judgment in the first action.
We shall proceed to consider this assignment of error.
The issue before the trial court in the case here under review was: Was the appellant “totally and permanently disabled” at any time after the cessation of installment payments and before the filing of the complaint in this action; and if so, between what specific dates was he so disabled?
In approaching the solution of this issue it is obvious that the evidence of appellant’s health prior to the time he claims in his suit that 'he was totally and permanently disabled, may throw a revealing light upon the state of his health for the period embraced within his claim.
But, it is argued in accordance with the objection in this case that this potential test of the factual basis of appellant’s claim is locked securely against use because of the prior judgment which fixed his health status from May, 1918 to November 2, 1927, the date of such judgment. The writer of this opinion sees no sound reason for such restrictive doctrine.
It is not contended by anybody that the evidence objected to in this case might not very properly affect the jury’s verdict, if the jury can be allowed to consider it. But upon some indefinite doctrine that does not assume the’ dignity of res judicata, appellant wished the trial court to hold that the government was estopped from using it in arriving at appellant’s health status at a time subsequent to the judgment in the 'first case.
It would seem that such idea comes from a misconception of just what is made res judicata by the first judgment. The status of appellant as one who was “totally and permanently disabled” for the period of time covered by the first judgment is of course unchangeable. But this fact does not exclude allv items of fact from consideration in the second trial merely because they were pertinent (whether introduced or not) to the issues of the first trial.
It would of course be different if the literal meaning of the phrase “totally and permanently disabled” were to be taken into consideration instead of its modification as heretofore,stated. And it may be, conceded, for the sake of argument, that no evidence questioning a fact in the nature of the case essential to the judgment pronounced- in the first action can be in*139troduced in the second action. The evidence to which the objection runs in this case does not come under this heading.
The facts upon which the testimony objected to in the second case are based, may tend toward a different judgment than the one arrived at in the first case, and yet it may be that that judgment was supported by other and more convincing testimony. But the testimony under objection may be strong enough to justly sway the judgment the other way in the second case when related to testimony pertinent to a subsequent time. Convincing illustrations may be thought out with little trouble, but I think the point is clear without their use. The point is that specific facts put in evidence are but evidentiary of the ultimate issues of a case.
Freeman on Judgments (5th Ed., Vol. 2, § 690) has the following to say upon this point:
“The doctrine of estoppel is restricted to facts directly in issue and therefore does not ordinarily extend to facts which may be in controversy, but which rest in evidence and are merely collateral even though they may have been passed upon. * * *
“During the trial of a cause, evidence may properly be received of the existence or nonexistence of facts which, though they bear upon an issue, and tend to show on which side of it the truth is, are not, though conceded to exist, necessarily conclusive. * * * if the judgment cam be correct, whether the fact in question exists or not, it is not directly in issue, and therefore does not become res judicata.” (Emphasis supplied.) Freeman, supra, § 690 pp. 1457, 1458. See, Cromwell v. Sac County, 94 U.S. 351, 352, 353, 24 L.Ed. 195; Troxell v. Delaware Lackawanna & Western R. Co., 227 U.S. 434, 440, 33 S.Ct. 274, 57 L.Ed. 586; Myers v. International Trust Co., 263 U.S. 64, 70, 71, 44 S.Ct. 86, 68 L.Ed. 165; cf. Southern Pacific R. Co. v. United States, 168 U.S. 1, 50, 18 S.Ct. 18, 42 L.Ed. 355.
The idea that the statute itself compels the other view does not impress me. It is true that the statute says that no further payments of insurance installments shall be made to appellant after the government has established that the insured “has recovered the ability to continuously follow any substantially gainful occupation * * ”. However, since the status of appellant has been unchangeably fixed by the first judgment for the period of time embraced thereby as one of “total and permanent disability” no change of such status could be legally contemplated except upon the conception of recovery. In my view the premise of “total and permanent disability” for the period of time cognizable by the first judgment is unqualifiedly accepted and all relevant and material evidence not tending to question a fact by the nature of the case not essential to the first judgment, is received in the second action to show the condition of appellant under the issues of the second suit. If such evidence shows appellant not ratable within such status, in legal contemplation, he has recovered the ability to continuously follow a substantially gainful occupation.
It is my opinion that evidence otherwise proper cannot be excluded from the second case merely because it would have been proper evidence to the issues of the first case. And I express it as my opinion that the testimony admitted by the trial judge in the second case was properly admitted both as affirmative proof that appellant was not totally and permanently disabled for the period cognizable in the second case, and to rebut or test the truth of the evidence introduced by appellant to establish his total and permanent disability.
If the rule is that the government could not make such a showing, then I apprehend that the rule would work both ways, and the veteran as well as the government would be subject to the same limitation. I think such a rule would unreasonably restrict the ascertainment of material facts and should not be favored by the courts.
The following quotations from appellant’s testimony show plainly that he related his troubles to his experiences and exposures in the war:
“It was at night, in the second line trenches. We were attacked by the enemy with a big shell and they got us in the trenches and the boys around me practically all got killed except me. I was down low so the shrapnel went right over me but the dirt went over my back and buried me down, except my head. That was the last I seen of the attack.”
“I was down at the University in St. Paul after the war; that was rehabilitation. I done some steel work before the war, probably seventeen or eighteen years ago. I worked at kitchens certain times in lumber camps, and I sailed on boats, and *140I worked at the Big Four, Minneapolis, at the tractor factory.”
“You see, I was too long in the trenches and I had to work out here, there was no excuse, my feet got flat, my vericose veins — ”
“I was trying to get help for my ears down .at Portland; they refused to do anything. I have holes in my mouth; I have the same thing in my chest, from the gas. This was the gas when I was in the front line trenches in the war. At different times, I dream about trenches of some sort; and I got to wake up and have a hard time to go back to sleep; I have to walk around of smoke. A couple of hours or so, I may be able to go to sleep again. •These spells of dizziness and seeing stars come on me when I feel pain in my back or chest. Besides, when I am working, they don’t come on except I happen to run fast or do something which is overstrain. When I get angry, everything comes up to me and I get noises in my head. If anything happens, I try as quick as possible to get in a quiet place. * * * I didn’t work for nobody after the trial.”
“The main thing is my feet. I can’t stand up on my feet. My feet begin to shake this way (indicating) and my back and my bones, looks like they are all going apart sometimes; sometimes I take my hand like that, I am afraid I can’t bring it back; sometimes when I sit down, I think I am unable to stand up. I am just like — you know — you slip down on your foot or something and it wouldn’t come back in place; sometimes, I go to sleep, my arm or something, I wake up — can’t feel my arms for an hour or two until I rub them, they are numb — ”
Briefly stated, the testimony as to the Work record obj ected to was as follows:
On cross-examination he (appellant) was questioned, over objection, with respect to jobs held and work done in the years 1925, 1926 and 1927. In its own case the government was allowed to introduce testimony of a special agent for the Federal Bureau of Investigation as to facts found in an investigation of payroll records relating to appellant’s' employment. This evidence was to the effect that from July, 1925 to November, 1927, appellant had. worked for eleven different lumber companies as bull cook, flunky, bed-maker, pump man or dragsaw operator. The witness went into much detail as to occupations, wages, and dates of employment. Another witness for the government was permitted to testify that for two or three months prior to November, 1927, appellant was employed in a lumber camp where he made beds for about fifty men, split wood and made fires in the stoves, carried the garbage from the cookhouse and swept eight bunkhouses twice 'a day.
The defense introduced exhibits representing payroll checks received from five different employers, dating from August, 1925, to September, 1927, aggregating about $400. Another exhibit was an application for employment dated September, 1925, containing extensive recitals of appellant’s employment prior to that date.
In receiving such testimony in the second trial the judge amply and plainly advised the jury that such evidence was to be considered only as to its effect upon the proof of appellant’s condition subsequent to the date the government stopped the benefit payments, and was not to be considered at all in relation to the issue in the first trial. This admonition was repeated in the final instruction to the jury. Should we determine that the jury was not bright enough to understand and appreciate this instruction, and assume, notwithstanding the plain intent of the instruction, that the jury would through confusion apply the evidence to the issues of the first trial, we would he indicting the jury system of our jurisprudence as incompetent.
I am convinced that no error was committed by the admission of appellant’s prior work record.
But it is quite reasonable at this juncture to inquire just what harm could be expected to result from such confusion even if it be conceded that confusion was present. Is it not true that the most that could have happened is that the jury might have made up its mind that appellant never was “totally and permanently disabled” and if it thought so might have disregarded the force of the rule (roughly expressed) that things or conditions established as existing are presumed to continue to exist? The jury in this case in such circumstances would begin the review of the evidence admitted at the trial without the force of this presumption. But since appellant himself was permitted and did freely go into evidentiary facts antecedent to the first judgment, and since such evidence and the government’s evidence objected to was all relevant to his condition for the period covered by the second action, it *141hardly seems consistent with the modern tendency of our jurisprudence to place this weak presumption over direct factual proof in order to reverse the verdict of a jury in a Federal court of law where the judge presiding has seen fit to deny a new trial. The appellant himself showed the way and he should not be allowed to complain after the case was conducted along the pathway of his own leadership.
Error is also assigned because the jury was instructed that “an insured who is suffering from a curable disease cannot, through his own neglect and inaction, permit the disease to progress to an incurable state, and then assert a liability on the insurance contract on the ground that the disability was permanent at its inception”.
There was no evidence in the case to which this instruction could be related and in all probability this instruction was given inadvertently from a stock form. I think it was not reversible error.
Timely objection was made by appellant to the form of the verdict submitted to the jury, which form was as follows: “We, the jury in the above entitled action, find for the plaintiff, and fix the date of the beginning of his permanent and total disability from -.” I think there was no error in this form of verdict.
I have treated all of appellant’s assignments of error except his assignment number four. My associate, Judge HEALY, has heretofore prepared certain comment upon this assignment which I think admirably covers the ground. I therefore adopt the same as my own with acknowledgment.
Error is assigned in the admission of a report of a medical examination of appellant made at a Veterans’ Hospital in 1935. A number of physicians had participated in the examination including a Dr. Ernest, who testified at the trial. The objection is confined to the portion of the report made out by Dr. Ernest. It is contended that, since the physician himself had testified, the report was hearsay.
Reports of this nature have often been admitted into evidence as an exception to the hearsay rule. United States v. Smith, 9 Cir., 55 F.2d 141, 81 A.L.R. 926; United States v. Blackburn, 9 Cir., 53 F.2d 19; United States v. Cole, 6 Cir., 45 F.2d 339; United States v. Stamey, 9 Cir., 48 F.2d 150; Third National Bank & Trust Co. v. United States, 6 Cir., 53 F.2d 599; United States v. Wescoat, 4 Cir., 49 F.2d 193; United States v. Rucker, 7 Cir., 80 F.2d 369. See, also, Wigmore on Evidence, vol. 3, § 1420 et seq., § 1630 et seq. As stated in the Wescoat Case, supra, such evidence “falls clearly within the principles under which exceptions to the hearsay rule are admitted, i. e., necessity and circumstantial guaranty of trustworthiness” [page 195]. We have found no case, however, in which the officer whose report was offered in evidence was also present as a witness.
It is true that the language used in a few of the cases seems to place some emphasis upon the element of necessity; that is, the fact that the physician is not available as a witness. United States v. Wescoat, supra, Third National Bank & Trust Co. v. United States, supra. Appellant contends that this language should be construed to mean that the report is inadmissible if the physician himself takes the stand.
The contention is unsound. The element of necessity is merely one of the grounds upon which this exception to the hearsay rule has been based. That ground is not indispensable. The fact that these medical reports, made in the regular course by government physicians who are under a duty to record the facts, are reliable as evidence, is sufficient ground for their admission. Furthermore, the case for their admission is all the more compelling when the physicians who prepared the reports are present in court and subject to cross-examination. Accordingly, we (I) hold that there was no error in the admission of the report.
Affirmed.