Court Opinion

ID: 9459270
Source: CourtListenerOpinion
Date Created: 2023-08-04 21:15:47.166344+00
Date Added: 2024-06-11T17:36:05.959400
License: Public Domain

SWYGERT, Chief Judge.
I respectfully dissent. In support of affirmance, the majority asserts (1) that the facts of the case display no breach of contract by the company and (2) that the damage award of arbitrator Platt is in conflict with a unit clarification ruling by the Labor Board, thereby unenforceable on the authority of Carey v. Westinghouse Electric Corp., 375 U.S. 261, 84 S.Ct. 401, 11 L.Ed.2d 320 (1964), Smith Steel Workers v. A. O. Smith Corp., 420 F.2d 1 (7th Cir., 1969), and Dock Loaders and Unloaders Local Union No. 854 v. W. L. Richeson & Sons, Inc., 280 F.Supp. 402 (E.D.La., 1968).1 With deference to the view held by my Brothers, I believe their reliance on Carey and its progeny is misplaced; if the arbitrator erred in finding a violation of contract, his award must fall for that reason and not because the award conflicts with a Board ruling. Moreover, if the arbitrator did not err, I cannot agree that his award is in conflict with a decision of the Labor Board.
*200I
Article II, Section I of the 1969 OCAW agreement reads:
This agreement shall apply only to the operations of the Company at its Whiting, Indiana plant; provided, however, if such plant or operation is moved to another location in the Calumet area, this agreement shall also apply to such other location.
The history of bargaining between the company and OCAW from 1959 reveals that this removal provision and analogous predecessors were insisted upon by OCAW to assuage its concern that the company would relocate operations performed by OCAW members at the Whiting plant despite representations by the company that it had every intention of continuing the Whiting operations. As it turned out, the fears of the Union proved justified; only a few months subsequent to consummation of the 1969 agreement, the company informed OCAW that it was terminating the finishing operation at Whiting and reestablishing it at East Chicago, where the company had already extended recognition to the Boilermakers.
Negotiations ensued. OCAW took the position that the company was bound by the removal provision to apply the 1969 agreement to finishing operations at East Chicago. The company’s response was to dispute the Union’s interpretation of the contract and to argue that it could not lawfully recognize OCAW or apply the OCAW contract at East Chicago inasmuch as it had already extended representation recognition to the Boilermakers. The company persisted in the latter position throughout the course of litigation on the matter, and, on March 10, 1971, invoked the Board’s representation processes by filing a unit clarification petition requesting that the Boilermakers’ bargaining unit at East Chicago be clarified to specifically include the employees working in the finishing operation at that location.
Thus it is fair to say that the company, both at the time of and subsequent to its decision to relocate the Whiting finishing operation, had no intention of applying the OCAW contract at East Chicago, and, indeed, was convinced that to do so would violate its legal obligation to the Boilermakers as the exclusive bargaining representative for East Chicago employees.
II
The majority’s holding that no contract violation occurred is summed up by the following paragraph of Judge Hastings’ opinion:
The Company did not apply the OCAW contract to Plant No. 1 because it could not legally do so, for such would have been an unfair labor practice. Having acted in accord with the NLRB decision, how may the Company be liable for damages for refusing to violate the law? There was no breach of contract because OCAW’s contract was never in force at Plant No. 1.
From this I discern two separate positions.2 The first is that the company was excused from compliance with the removal clause of the OCAW contract because of impossibility of performance ; the second is that the company could not have breached the contract because it “was never in force at Plant No. 1 [East Chicago].”
While the quoted excerpt is a correct statement of fact, it fails as a premise to support its conclusion. That the contract sued upon was in force at Whiting *201is beyond dispute; the issue before us is whether the contract was violated at that location, not at East Chicago.
In resolving this issue a cardinal principle of contract law must be kept in mind. Professor Williston states it as follows:
It is a principle of fundamental justice that if a promiser is himself the cause of the failure of performance either of the obligation due him or of a condition upon which his own liability depends, he cannot take advantage of the failure. 5 Williston, Contracts § 677 (3d ed. 1961).
Professor Corbin is of like mind:
Whatever be the meaning given to the term impossibility, whether it be objective or subjective, and even though it be used to include varying degrees of difficulty and expense, the supervening situation that is so described does not excuse a promisor from his contractual duty if he himself wilfully brought it about, or if he could have foreseen and avoided it by the exercise of reasonable diligence and efficiency. In such a case, the promised performance was not impossible in any sense, either at the time the contract was made or for some time thereafter. 6 Corbin, Contracts § 1329 (1962).
To put it another way, and with specific reference to the agreement at issue, the requirement of the removal clause that the OCAW agreement be applied at any new site of operation embodies a prohibitory mandate that the company undertake no move which would foreclose application of the contract. And the facts leave no room for dispute that the company found it impossible to obey the removal clause because it chose to move the Whiting operation to a plant where exclusive representation had already been granted to another union. The real issue, then, is whether the company exercised “a reasonable degree of effort and diligence” in attempting to comply with the removal clause. ,6 Corbin, Contracts § 1329 (1962).
The arbitrator found that the move from Whiting was motivated solely by economic considerations. The company admits this: “In late 1969 . . .serious financial considerations such as market projections, general economic forecasts and orders, caused the Company to reconsider [its] plans to maintain dual facilities.” Def. Brief at 5. Generally speaking, however, changed economic circumstances do not validate a defense of impossibility. This is not a case like United Auto Workers v. Hamilton Beach Mfg. Co., 40 Wis.2d 270, 162 N.W.2d 16 (1968), In re Curtiss-Wright Corp. and Office Employees’ International Union, Local 279, 43 Lab.Arb. 5 (1964), or In re Safeway Stores, Inc. and Retail Clerks International Union, Local No. 648, 42 Lab.Arb. 353 (1964), where the union contract contained no express provision dealing with plant removal, and legitimate business motives were found to justify a move of operations. See also Shoe Workers v. Brooks Shoe Mfg. Co., 183 F.Supp. 568 (E.D.Pa., 1960). This, instead, is a case where plant removal was barred except upon the condition that the contract be applied at any new site of operation. This provision was not complied with. Absent extreme economic hardship, cf. In re Curtiss-Wright Corp. and Office Employees’ International Union, Local 279, 43 Lab.Arb. 5 (1964) — which the company certainly has failed to establish — no excuse lies for its breach of the removal clause. See In re Jack Meilman and Amalgamated Clothing Workers of America, 34 Lab.Arb. 771 (1960), In re Centra Leather Goods Corp, and Pocketbook Workers Union of New York, 25 Lab.Arb. 805 (1956).3
*202III
Smith Steel Workers v. A. O. Smith Corp., 420 F.2d 1 (7th Cir., 1969), holds that a unit clarification decision by the Labor Board provides an absolute defense to employer liability for violation of contract provisions respecting work assignments when work is assigned by the employer in conformity with the Board’s ruling. Dock Loaders and Unloaders Local Union No. 854 v. W. L. Richeson & Sons, Inc., 280 F.Supp. 402 (E.D.La., 1968), adds the corollary that employer violations of work assignment contract provisions are wiped out if his actions prove to be in conformity with national labor policy as interpreted by the Labor Board in a subsequent unit clarification ruling.
I do not agree with the majority that these cases are dispositive of the instant appeal. The company did not violate its contract with OCAW by refusing broadly to apply the work assignment provisions of the contract. It entirely avoided the OCAW contract by moving its finishing operation to a location where the NLRA — and, later, an NLRB decision — foreclosed adherence thereto, in direct violation of the contract’s removal clause. The distinction is important. Arbitral decisions on the issue of work assignment and Labor Board unit clarification decisions go to the heart of an identical question: Who shall perform disputed work? An arbitrator’s decision that a company has violated its contract by moving the site of a given operation is an entirely different matter. In short, the decision by arbitrator Platt is wholly compatible with the unit clarification by the Board.
Had the relocation of operations at issue been required by the Act or by a Board decision, I would agree that Smith and Dock Loaders fully dispose of OCAW’s sought damage award. This case, however, is one step removed; free from statutory or administrative compulsion and motivated solely by thoughts of financial gain, the company placed itself in a position where it could not apply the OCAW contract. While the end result of the company’s decision to remove has a surface similarity to the situations in Smith and Dock Loaders, the fact remains that the dilemma in which the company assertedly found itself prior to the NLRB decision was entirely of its own making and the product of its willful violation of the collective bargaining contract. In Smith and Dock Loaders the employer had no way of avoiding the eventual disputes with competing unions. If he favored one union, the other protested breach of contract and violation of the NLRA. This case does not present that situation. Had the company chosen to comply with the removal clause by staying at Whiting or moving to another location where compliance was practicable, it is difficult to imagine that the Boilermakers or the Board would have been heard to complain.
Although I agree that not all remedies may be open to an arbitrator when a violation of contract is found, the fact that one remedy may be unavailable hardly justifies a denial of liability. This, in essence, is what the company is arguing here;4 since, it asserts, an injunctive remedy requiring application of the OCAW contract at East Chicago is *203precluded by the Board unit clarification, damages on the same contract would be inconsistent. This is not correct. The company violated the OCAW contract in a manner which — unlike a work assignment violation — is not protected by the Board clarification decision. That the Board decision precludes injunctive relief for that violation is no reason to withhold all relief.
I would therefore reverse the decision of the trial court and remand the cause for a determination of damages to OCAW.

. See also Iron Workers, Local 395 v. Carpenters, 347 F.Supp. 1377 (N.D.Ind., 1972), a case very close on its facts to Doch Loaders.

. A clarifying interpretation is needed for the statement that the company “acted in accord with the NLRB decision.” There was no such decision in existence when the company chose to move the finishing operation from Whiting. The company relied solely on the NLRA in refusing to apply the OCAW contract at East Chicago. Furthermore, neither the NLRA nor the eventual unit clarification ruling by the Board ordered the company to move its finishing operation; each dictated only that operations at East Chicago were solely within the jurisdiction of the Boilermakers.

. Assume that arbitrator Platt required the company to reestablish finishing operations at Whiting, rather than awarding the contingent injunctive relief that he did. See In re Centra Leather Goods Corp. and Pocketbook Workers Union of New York, 25 Lab.Arb. 805 (1956). In that event I doubt that the company would argue that Smith and Dock Loaders require vacation of the damage award, since company compliance with the arbitral mandate would eliminate any possibility that company action would conflict with the Board clarification of the East Chicago unit. This case differs only in that the injunctive relief sought by OCAW did raise such a conflict. But it bears repeating that the injunctive remedy *203is not now at issue; as the arbitrator himself recognized, that remedy was necessarily “contingent upon a determination by the National Labor Relations Board that it would not violate the provisions of the NLRA.”