Court Opinion

ID: 9446687
Source: CourtListenerOpinion
Date Created: 2023-08-03 22:16:19.962355+00
Date Added: 2024-06-11T17:30:44.823444
License: Public Domain

McLAUGHLIN, Circuit Judge
(dissenting).
In sustaining the dismissal of plaintiffs’ complaint for its failure to join the union or its members who were the beneficiaries of the arbitration award, the majority completely overlooks, what seems to me, the sound theory and practice of the suit.
At this stage of the case the allegations of the complaint must be accepted as true. They are that in 1957 Mid-States and Spector, two freight lines, were merged. Both companies had labor contracts with the same union local. These were identical with respect to seniority rights and assignment provisions. After the merger the former Mid-States’ employees were in fact the senior employees of Spector. Despite this Spector placed them behind the old Spector employees. The union not only supported that action but according to the complaint had itself compiled the seniority list. That operation, under the contract, could only be done by Spector. As a result of the plaintiffs’ protest Spector and the union, conspiring to circumvent the legal and contractual rights of the plaintiffs, presented the matter to an alleged arbitration. At that proceeding there was no representation on behalf of the plaintiffs. The true issue of assignment, states the complaint, was never given the arbitrator.1 The latter found “That the deter*878mination of the Union on seniority of employees of Spector in its Newark terminal following the combining of operations of Mid-States and Spector is proper.” (Emphasis supplied.)
This suit followed. It is not predicated on the conspiracy between the employer and the union but on plaintiffs’ employment rights arising out of the Mid-States’ labor contract. That contract® was for plaintiffs’ benefit. Spector, by its assignment clause, was bound to live up to it. Spector violated that obligation and these plaintiff employees sued to force its performance. Items such as the union and Spector going into a pseudo arbitration with not even a pretense of notice or representation to the old Mid-States employees lend authentic atmosphere to plaintiffs’ claim. However, they are not the cause of action. The foundation of the case is the charge that Spector violated the Mid-States’ labor agreement to which it had succeeded. Under that contract it had the duty of making up its seniority list. The approval by the union of that final list, as set out in the contract, could not in the instant situation extend further than ascertaining that the placement of the names accurately reflected their payroll seniority. The list Spector adopted deprived the plaintiffs of substantia] rights. It made a mockery of the justice to all employees guaranteed by the contract.
I take the view that these plaintiffs here and now are not without remedy. Certainly the circumstances before us in no way qualify to substantially support the arbitration as a judgment under the governing New Jersey arbitration law, N.J.S.A. 2A.-24-1 et seq. And in any event that law would not hamper equity’s power over such a void award as is charged in the complaint. Hoboken Manufacturers’ R. Co. v. Hoboken R. R. Warehouse & Steamship Connecting Co., Ch.1942, 132 N.J.Eq. 111, 27 A.2d 150, affirmed 133 N.J.Eq. 270, 31 A.2d 801; McKeeby v. Arthur, 1951, 7 N.J. 174, 81. A.2d 1.
The union could not validly make up a new list for the consolidated company. The two existing lists, as properly coordinated by Spector, had to be the final seniority list. The union had no authority to disturb this.
In the circumstances there is no present justification for forcing these men to the ruinous step of suing their own union on this contract claim which is directed entirely at their employer. The union and the employees advanced over plaintiffs might be interested but they are not indispensable parties. The only rights that have been taken away, under the present posture of this litigation, are plaintiffs’. There is not the slightest intimation that in restoring those, any other employees will be wronged. As of now the employees placed above plaintiffs are merely wrongfully occupying plaintiffs’ senior status. It would seem therefore that appellants’ contention that they are third-party beneficiaries of the labor contract2 properly suing the particular obligor under that contract who owes them relief is unassailable. They are the persons injured, no one else. And they are entitled to proceed against the one responsible. In re Italian Cook Oil Corporation, 3 Cir. 1951, 190 F.2d 994; Restatement of the Law of Contracts, Section 141(1). Even considering that this action is really one for specific performance by Spector of the contract it had assumed, the governing New Jersey law would not require the union and the members who displaced plaintiffs to be joined. See Pennsylvania & New England R. v. Ryerson, Ch.1882, 36 N.J.Eq. 112, cf. Christiansen v. Local 680, of Milk Drivers & Dairy Employes of New Jersey, Ch. 1940, 126 N.J.Eq. 508, 10 A.2d 168.
Plaintiffs’ courage and resourcefulness will not of course legalize their suit but *879plaintiffs go far beyond that. They make out a cause of action against their employer who has treated them unjustly. They should be allowed to proceed with it.

. The assignment provision reads:
“This Labor Contract shall be binding upon the successors, heirs, lessees, lessors, and assigns of the parties hereto and shall be binding on the Employer should the Employer move his place of *878business and/or open another Terminals) in Essex and Union Counties, N. X, and other places in New Jersey where no other Local Union of the I.B. of T.C.W. & H. of A. has jurisdiction.”

. Cf. J. I. Case Co. v. N. L. R. B., 1944, 321 U.S. 332, 64 S.Ct. 576, 88 L.Ed. 762; Kennedy v. Westinghouse Electric Corporation, 1054, 16 N.J. 280, 285, 108 A.2d 409, 47 A.L.R.2d 1025.