Court Opinion

ID: 9475752
Source: CourtListenerOpinion
Date Created: 2023-08-05 05:37:02.345703+00
Date Added: 2024-06-11T17:44:54.380604
License: Public Domain

POOLE, Circuit Judge,
dissenting:
The district court’s holding that J.L.M. effectively repudiated the pre-hire agreement by conduct prior to the issuance of its formal letter of repudiation is untenable. The findings of fact simply do not support this conclusion. Since it is clear error for a district court to reach a conclusion which is unsupported by its own factual findings, we must, if we are to remain faithful to rationality, reverse the judgment. From the majority’s affirmance of a clearly wrong judgment, I am forced to dissent.
The record is devoid of any evidence supporting a conclusion that the Union knew of J.L.M.’s contractual violations. The district court found only that after December 1, 1977 J.L.M. did not use the union hiring hall, pay union wages or fringe benefits, contact the Union, or bid as a union employer. It never found that the Union was actually aware of any of these omissions.
*600Moreover, contrary to the majority’s assumption, the findings do not support the conclusion that the Union should have known of J.L.M.’s contractual violations either. That J.L.M. did not use the hiring hall is not shown to have been something that must surely have come to the attention of the Union, and, in the absence of an employee grievance, the Union would not be on notice that J.L.M. was not paying union wages. Similarly, there is no evidence that the Union generally monitored construction activities or contract bidding by non-Union employees. Nor is there any evidence that a union representative visited any J.L.M. work site and learned that it was violating the pre-hire agreement. In view of the very large size of the southern California territory, it is not at all unreasonable for the Union to have failed for so long to detect J.L.M.’s violations. The finding that J.L.M. did not communicate with the Union in the period between December 1, 1977 and July 20, 1982, if anything, supports the conclusion that the Union was unaware of the fact that J.L.M. was not abiding by the terms of the pre-hire agreement.
Prior decisions of this and other courts have insisted that an employer may repudiate a pre-hire agreement by conduct only so long as both the union and employees are put on notice that the contract is voided. Operating Engineers Pension Trust v. Beck Engineering & Surveying Co., 746 F.2d 557, 566 (9th Cir.1984); Contractors, Laborers, Teamsters & Engineers Health & Welfare Plan v. Harkins Construction & Equipment Company, Inc., 733 F.2d 1321, 1325-26 (8th Cir.1984); Washington Area Carpenters’ Welfare Fund v. Overhead Door Co. of Metropolitan Washington, 681 F.2d 1, 9 n. 38 (D.C.Cir.1982), cert. denied, 461 U.S. 926, 103 S.Ct. 2085, 77 L.Ed.2d 296 (1983); Todd v. Jim McNeff, Inc., 667 F.2d 800, 804 (9th Cir.1982), aff'd, 461 U.S. 260, 103 S.Ct. 1753, 73 L.Ed.2d 1382 (1983). Here, the Union cannot be said to have been put on notice of J.L.M.’s intent to repudiate by conduct because neither the district court nor the majority could point to a scintilla of evidence that the Union knew anything of the alleged conduct. Regardless how unambiguous the contract violation, if the non-repudiating party does not know of the inconsistent conduct, and there is no showing that it should have known, it is altogether unreasonable and contrary to elementary principles of contract law, or of governing human experience, to maintain that a repudiation is effected.
At most, the district court’s findings indicate that J.L.M. breached the terms of the pre-hire agreement. But an employer’s mere unilateral breach of contractual obligations under a pre-hire agreement does not logically nor legally suffice to work a repudiation on these facts. Harkins Construction Co., 733 F.2d at 1326; Jim McNeff, 667 F.2d at 804.
In affirming on this record, the majority badly misconstrues the very authorities upon which it relies. In Harkins Construction Co., the Eighth Circuit stated clearly that repudiation by conduct requires actual knowledge of the repudiating party’s contractual violations: “[Ojpen and notorious acts by one party, known to the other, which are inconsistent with the continuance of the contract would, in our view, constitute sufficient notice of repudiation.” Harkins Construction Co., 733 F.2d at 1326 (emphasis supplied). In Jim McNeff we chose to cite Iron Workers, Local 103 (Higdon Construction Co.), 216 N.L.R.B. 45; 88 L.R.R.M. 1067 (1975) to illustrate what we meant when we said that “in some circumstances noncompliance can be so bald as to put the union on notice of the employer’s intent to repudiate.” 667 F.2d at 804. In Iron Workers, Local 103 noncompliance with a pre-hire agreement was so “bald” that the union picketed employer’s job site for more than a month in protest. In the other cases the majority mentions in its discussion of repudiation by conduct, the unions had actual knowledge of employers’ contractual violations, as well. United Brotherhood of Carpenters v. Endicott Enterprises, Inc., 806 F.2d 918, 923 (9th Cir.1986) (“[I]t is undisputed that the Union had actual notice of the *601open and notorious acts on the part of Endicott.”); Suburban Teamsters of Northern Illinois Health, Welfare & Pension Funds v. Callaghan Paving, Inc., 583 F.Supp. 105, 109-10 (N.D.Ill.1984) (employer notified secretary-treasurer of union local of intent to repudiate pre-hire agreement). Thus, the majority’s claim that a repudiation can be effected by conduct, despite the innocent party’s good faith ignorance of the very existence of that conduct, is not only unsupported by, but is also contrary to, all precedent.
By opening the door to repudiation by what are in effect subjective, uncommunicated verbal acts, the majority ignores this court’s earlier admonition that employers are not free to enjoy the benefits of prehire agreements while misleading unions as to their undisclosed intention not to perform their obligations. Jim McNeff, 667 F.2d at 804. Because there is no evidence that the Union knew, or should have known, of J.L.M.’s uncommunicated breaches, the judgment of the district court should be reversed.