Title: Day v. Northwest Division 1055

State: oregon

Issuer: Oregon Supreme Court

Document:

Reversed January 29, 1964.
Petition for rehearing denied April 28, 1964.
Certiorari denied, October 23, 1964.
Paul T. Bailey, Portland, argued the cause for appellants. With him on the briefs were Bailey, Swink & Gates and Harl H. Hass, Portland.
Maurice Sussman, Portland, argued the cause for respondent. With him on the brief were Sussman & Sussman, Portland.
Before McALLISTER, Chief Justice, and ROSSMAN, PERRY, SLOAN, O'CONNELL, GOODWIN and LUSK, Justices.
Certiorari denied, United States Supreme Court October 23, 1964.
REVERSED.
*625 SLOAN, J.
Plaintiff Day was employed as a driver by Western Greyhound Lines. His employment was governed by a contract between Greyhound and defendant local union Northwest Division 1055. Amongst other things this contract required Day to remain a member of the union in good standing in order to retain his employment. On November 3, 1959, Day's employment was terminated by Greyhound at the request of the individually named defendant, Bankhead. The latter was financial secretary of the union. The ostensible cause of Bankhead's request that Day's employment be terminated was the failure of Day to pay his union dues on time. There was evidence to show, and the jury found, that the real cause was a conspiracy to get Day out of the union. Day brought this action for tortious interference with his employment and received a large jury verdict for general and punitive damages. Defendants union and Bankhead appeal.
Other defendants were originally named; we need not consider them. They have been removed from the case. Other detailed facts could be stated. This is unnecessary. The basis of our determination of the case is two recent decisions of the United States Supreme Court on the subject of federal pre-emption of disputes like the instant case. These cases, Association of Journeymen v. Borden, 373 US 690, 83 S Ct 1423, 10 L Ed2d 638, and Iron Workers Union v. Perko, 373 US 701, 83 S Ct 1429, 10 L Ed2d 646, were both decided on June 3, 1963. Unfortunately these decisions were filed after the pre-emption issue was decided on a pleading's issue by the trial court and after briefs were filed by the parties here.
Our study of these and other cases and authority have caused us to conclude that Borden and Perko *626 limit plaintiff's relief here to the National Labor Relations Board. The earlier case of Machinists v. Gonzales, 1958, 356 US 617, 78 S Ct 923, 2 L Ed2d 1018, which gave support to plaintiff's claim here has now been substantially modified, if not overruled, by later cases. The first case after Gonzales to further restrict the jurisdiction of the state courts was San Diego Unions v. Garmon, 1959, 359 US 236, 79 S Ct 773, 3 L Ed2d 775. The Garmon decision caused the Second District, Division One of the California Court of Appeals in Fullerton v. International Sound Technicians, Etc., 1961, 194 CA2d 801, 15 Cal Rptr 451, by an extensive opinion, to conclude that federal authority had pre-empted all cases of the kind now before us. And in Perko the Court stated at 373 US 705 that:
The dissenting opinion in the Borden case provides strong emphasis that Gonzales can no longer be held to support state jurisdictions in the instant and other like cases.
It is true that in United Workers v. Laburnum Corp., 1954, 347 US 656, 74 S Ct 833, 98 L Ed 1025, followed later by Automobile Workers v. Russell, 1958, 356 US 634, 78 S Ct 932, 2 L Ed2d 1030, the Court sustained recovery in state courts for damages in tort. But in the later case of Garmon, supra, at 359 US 236, 247, the Laburnum Construction Corporation and Russell cases were limited to torts by violence which created a "compelling state interest" to maintain domestic peace.
*627 We learn from cases like National Lab. Rel. Bd. v. Technicolor Motion Pic. Corp., (9th Cir USCA, 1957), 248 F2d 348, and International Union of Electrical, R. & M. Wkrs. v. N.L.R.B., (USCA-DC 1962), 307 F2d 679, that a union may lawfully require an employer to discharge an employe for a failure to maintain good standing in the union, when the union contract permits it, as in the instant case. If the request for discharge has been honest and for the actual reason assigned, the union and employer are within their rights and it is held that no unfair labor practice has occurred. But, if the discharge for failure to pay dues was used as a subterfuge to hide some other improper motive, as in the instant case, the union, at least, has been guilty of an unfair labor practice and the National Labor Relations Board will, presumably, protect the workman's rights. The cases leave no doubt that the decision as to the true nature of the discharge is within the cognizance of the Board.
Garmon, supra, Borden and Perko all tell us that if the conduct alleged "may reasonably be asserted to be subject to Labor Board's cognizance," then the courts, both state and federal, are without any right to proceed. In this case the Board does reasonably have cognizance of the question at issue and we must desist from further proceedings.
We have no hesitancy in stating that we reach that conclusion with reluctance. However, the result has been fortified by Retail Clerks Internat'l Ass'n, Local 1625 v. Schermerhorn, decided December 2, 1963, 84 S Ct 219, 223, 11 L Ed2d 179, 185, wherein the Court made this reference to the Borden and Perko cases:
It follows that the action must be dismissed.
PERRY, J., dissenting.
The majority fail to set forth the facts which are necessary to determine this case, so I shall do so.
The material facts in this case are that plaintiff Day was a member of the defendant Local 1055, a labor union; that he was employed as a bus driver by the Greyhound Corporation, a corporation engaged in interstate commerce. The union had a union-shop agreement with Greyhound. A check-off system for the payment of dues was inaugurated by the officers of the union and acquiesced in by Greyhound. A number of the employees, among them this plaintiff, protested the deduction of dues from pay checks because they had not signed authorization cards, and thereafter plaintiff received his pay check without the deduction. This change required the plaintiff to pay his dues directly to the union.
After this change was made in the method of the payment of dues, the defendant Bankhead, as financial secretary of the union in charge of collection of membership dues, wrote a letter to plaintiff, advising him that he was delinquent in the payment of his September dues, but would be allowed until October 28, 1959, to make this payment, or be suspended.
Plaintiff, on October 27, 1959, went to the union office and paid his September dues. At this time, Bankhead advised plaintiff that his October dues were *629 owing and must be paid by October 31, 1959. Bankhead then determined the defendant was no longer a member of the union. On November 2 Bankhead notified Greyhound to discharge plaintiff, as he had suspended himself from membership in the union and was, therefore, no longer a member in good standing as required under the union-shop agreement.
Pursuant to Bankhead's notification, Greyhound on November 4 notified plaintiff that he was discharged. The morning of November 5 the amount of the dues, $14.00, was received by defendant for plaintiff's October and November dues. This money had been placed in the mails on November 3, one day before his discharge by his employer. The tender of dues was then rejected by the union on the basis that at the time the tender was received the plaintiff was not then employed as a bus driver or in any activity or industry over which the union exercised jurisdiction.
On November 12, on an approved form, plaintiff filed a "charge" against the union, alleging it had engaged in an unfair labor practice "within the meaning of Section 8(b) subsections 1 and 2 of the National Labor Relations Act, * * * affecting commerce * * *," as follows:
*630 On December 15 the plaintiff received the following notice from the Regional Director:
The Regional Director states he has carefully investigated the plaintiff's complaint and there is not sufficient evidence "at this time" to prosecute the complaint. It should be noted that all of the evidence offered in this case was available at the time the complaint was filed. The plaintiff made no attempt to obtain a review of the findings and decision of the Regional Director, and the decision of the Regional Director thus became final.
There is some evidence that on occasion other union members had been late in the payment of dues, but they were not dropped from membership if the *631 dues were later tendered. There is also evidence that plaintiff had objected to the check-off system. The union rules in relation to the late payment of dues provide as follows:
*632 The agreement between Greyhound and the union insofar as applicable is as follows:
The plaintiff in his complaint alleges:
*635 Based upon a finding that plaintiff was discharged from his employment, not because of failure to pay dues, but because the union officers disliked his attitude, the jury returned a verdict for the plaintiff.
The defendants having questioned the jurisdiction of the state courts, the primary question that must be answered is whether the National Labor Management Relations Act of 1947, as amended, has granted the National Labor Relations Board exclusive jurisdiction of the issues presented under the facts of this case. Whether or not exclusive jurisdiction to determine the issues presented herein lie with the National Labor Relations Board depends upon the congressional intention as expressed in the Act.
The Act provides:
The fact alone that an Act is an unfair labor practice is not the test of the Labor Board's exclusive jurisdiction in all cases. The Act provides, and the Supreme Court of the United States has stated, "the authority of the Board to deal with an unfair labor practice which also violates a collective bargaining contract is not displaced by § 301, but it is not exclusive and does not destroy the jurisdiction of the courts in suits under § 301." Smith v. Evening News Association, 371 US 195, 83 S Ct 267, 269, 9 L Ed2d 246.
In Smith v. Evening News Association, supra, Smith, an employee of the Evening News, sued this employer on behalf of himself and others for damages for breach of a collective bargaining contract entered into between the union and the association. The action was filed in the Circuit Court of Wayne County, Michigan. We quote:
*638 Section 301 reads as follows:
It will be noted that the language of the Act does not mention the right of an individual to sue for his injuries, but, as stated by the court in Smith v. Evening News Association, supra, § 301 "is not to be given a narrow reading." 83 S Ct 267 at 270. Also, as in this matter before us, a member of a union may sue the union of which he is a member in the state courts for causing a breach of the bargaining agreement between the employer and the union. Humphrey v. Moore, Nos. 17 and 18 US S Ct, January 6, 1964; 32 LW 4055.
A bargaining agreement entered into by the union is for the benefit of both the employees and the employer, and in the matter before us we must assume the union shop clause was considered beneficial to both. It appears from the allegations of plaintiff's complaint that defendants did cause a breach of the bargaining agreement. Therefore, the courts of this state have concurrent jurisdiction with that of the National Labor Board to determine and adjudicate the issues here presented.
If, on the other hand, the suit of the plaintiff is treated entirely on the basis of tortious conduct, separate *639 and apart from § 301 of the Act, I reach the same result.
Without analysis of the basis upon which San Diego Bldg. Trades Council v. Garmon, 359 US 236, 79 S Ct 773, 3 L Ed2d 775, Association of Journeymen v. Borden, 373 US 690, 83 S Ct 1423, 10 L Ed2d 638, and Iron Workers Union v. Perko, 373 US 701, 83 S Ct 1429, 10 L Ed2d 646, as modified by the 1959 amendments to the Act, rest, the majority hold the underlying legal principles set forth in those cases control the issues in the matter before us.
Those cases demonstrate that, where a policy issue is presented, the National Labor Relations Board shall first decide the policy issue, and until decided all courts are denied the primary right of adjudication.
An examination of each of these cases discloses that the word "arguably" was used by the Court in the primary sense as a word of art, to describe the existence of an uncertainty as to whether an act or practice, not specifically defined in the Act, engaged in by one of the disputing parties would be protected or not protected within the policy intent of the Act.
"Arguably" as used in the primary sense in Garmon discloses uncertainty existed as to whether or not, under the circumstances existing, peaceful picketing of the premises of defendant Garmon by the union was prohibited or permitted under the Act.
In Borden, the uncertainty existed as to whether the union had a right under the Act to refuse to recommend a member for certain employment who refused to abide by a union rule which might or might not be recognized by the Board as a proper protected concerted activity of the union within the meaning of § 7.
In Perko, the uncertainty existed, first, as to the *640 status of Perko as a foreman or general employee. This question, it was held, is one "of a kind most wisely entrusted initially to the agency charged with the day-to-day administration of the Act as a whole." Marine Engineers Beneficial Assn. v. Interlake Steamship Co., 370 US 173, 180. And, second, that Perko's discharge by his employer caused by the union was due to Perko's violation of a union rule that may or may not have been a protected rule under the Act.
Certainly, where an agency has been designated to primarily determine whether an act or practice is authorized or protected within the framework of an Act, no court would be in a position to determine whether or not a person was injured by a claimed wrongful act of another until the law had previously determined that the claimed act, if proven, was wrongful.
That "uncertainty" as to whether an act or practice would be protected or not is the basic reason for the use of the word "arguably" is born out by the language of the Supreme Court of the United States in Retail Clerks International Association, Local 1625, v. Schermerhorn, 83 S Ct 1461, 1466, 10 L Ed2d 678, 684:
*642 It is also true, there is language in Garmon to the effect that if the act or practice is "arguably" one specifically prohibited by the Act, then the National Labor Relations Board alone has sole power to primarily adjudicate the issue. The basis for the use of the word "arguably" in this sense, later as argued by the Supreme Court, lies in the finding of a congressional intent that to effectuate the purposes of the Act, uniformity of remedy is required.
If the gist of plaintiff's action is in damages for tortious dismissal from the union, then, since the 1959 amendment to the Act, the requirement of uniformity of remedy cannot be inferred as the Act provides that any state remedies previously available to a wronged union member by his union remain available.
Section 603(a) of the Labor Management Reporting and Disclosure Act of 1959 provides as follows:
Prior to the enactment of the Reporting Act the Supreme Court of the United States had held in Automobile Workers v. Russell, 356 US 634, 78 S Ct 932, 2 L Ed2d 1030, and in United Workers v. Laburnum Corp., 347 US 656, 74 S Ct 833, 98 L Ed 1025, that an injured party was not required to forego his common-law remedy in the state courts, even though a remedy was provided the injured party under the National Labor Relations Act.
In Machinists v. Gonzales, 356 US 617, 78 S Ct 923, 2 L Ed2d 1018, the Court, following the rationale of Russell and Laburnum as to conflict of remedies, *643 held that, where there was only partial relief available through the Board, there was no great danger of conflict with the federal policy by reason of the different remedies, and the states were, therefore, at liberty in such circumstances to resolve all the issues.
It seems clear to me from the above language of this Act that, insofar as the individual members of a labor organization are concerned, in those instances where they suffer from the tortious acts of a union, Congress intended to set aside the Garmon restrictions and return to the doctrine expressed by the Court in Russell, Laburnum and Gonzales.
To accept the hypothesis of the majority is to argue that Congress intended in those matters affecting the individual workman that uniformity of remedy should require exclusive federal jurisdiction even to the denial of all remedy.
It was to prevent the perpetuation of a remediless no-man's-land in conflicts between organized labor and management under the doctrine of Guss v. Utah Labor Board, 353 US 1, 77 S Ct 598, 1 L Ed2d 601, that Congress amended the National Labor Relations Act as follows:
This 1959 amendment to the Act does not specifically require the application of federal law in those cases where the Board declines jurisdiction, and it is quite clear that Congress in passing this Act rejected the idea that uniformity of remedy was an essential policy requirement as to all phases of the Act.[1]
Certainly Congress, while providing remedial legislation to alleviate the intolerable no-man's-land for labor and management, ought not be accused of intending to create a no-man's-land for the individual workman. Nevertheless, the opinion of the majority creates that very situation and condemns its authors.
The plaintiff filed a complaint with an officer of the National Labor Relations Board, stating he had been discharged by his employer on a false claim by the union that he was delinquent in his dues. The officer of the Board refused to file a complaint with the Board.
Section 3(d) of the Act provides that the General Council of the Board shall have final authority as to "the issuance of complaints * * * before the Board." It also provides that the General Council shall have authority over the "officers in the regional offices." This section of the Act has been construed to deny *645 the right of the Board to adjudicate a claimed unfair labor practice until the General Council, or someone authorized by him, has issued a complaint. Hourihan v. National Labor Relations Board, 201 F2d 187, 91 US App 316; Haleston Drug Stores v. National Labor Relations Board, 187 F2d 418, cert. denied, 342 US 815. Thus it would appear that in those instances, as here, where there is a claim that an unfair labor practice has been committed, and the Regional Director refuses to issue a complaint, it is possible that no forum exists for an adjudication that could make the injured workman whole.
If, therefore, the courts are without jurisdiction, the injured workman is denied damages for his injury. In my opinion, the congressional reason for enacting the quoted portion of § 603(a) when amending the Act in 1959, was to prevent this very injustice.
While it may be contended by some that the use of the word "law" should be restricted to acts passed by the state's legislative body, no such restrictive interpretation should be indulged in. The Act is remedial and should be liberally construed to give the workman his prior rights under the recognized law of a state.
For the foregoing reason, I would affirm the judgment of the trial court.
ROSSMAN, J., concurs in this dissent. X
[1]  Congress rejected the "Prouty Amendment" (105 Cong. Rec. 5949 [daily ed., April 24, 1959]) which would have required the states to apply Federal law.