Court Opinion

ID: 9650398
Source: CourtListenerOpinion
Date Created: 2023-08-23 15:35:11.766403+00
Date Added: 2024-06-11T12:44:10.883452
License: Public Domain

VAN VALKENBURGH, Circuit Judge
(dissenting).
I am unable to agree with my associates in their disposition of this appeal b.y reversal of the judgment of the trial court upon the motion to expunge the claim filed by the National Labor Relations Board in bankruptcy for the back pay awarded, alleging further that the claim was entitled to priority as a debt owing to the Board, and, therefore, to the United States, over all other claims, whether of administration or otherwise.
Incidentally, it may be added that there are in the hands of the referee insufficient funds to pay in full all such claims if allowable and allowed.
The hearing upon this motion by express agreement was confined to the validity of the Board’s claim; no other issue was involved. At this hearing the Trustee in Bankruptcy offered and incorporated in the record the individual claims of the wage-earners whose names are scheduled in the Board’s claim, and who have filed individual claims with the referee. These individual claims, offered and admitted in evidence, were omitted from the transcript *615on this appeal at the request of counsel for the National Labor Relations Board. We have, therefore, only to determine in this appeal (a) whether the Board, as such, had authority to file this claim; and (b) if so whether it is entitled to priority as, in effect, a debt due the United States or one of its agencies. This latter claim is based upon 31 U.S.C.A. § 191, which provides that in cases of insolvency debts due to the United States shall first be satisfied. Counsel for the Board admit that appellant has no monetary interest in the claim, since neither it, nor the United States, for that matter, would receive the money if allowed as a claim in bankruptcy.
It appears to present itself in the guise of a plenary trusteeship, and states that its present practice is to receive back pay payments and to make distribution of the money to the entitled employees. But such practice, even though acquiesced in by the parties in interest, could confer no quality of trusteeship nor wardship, and none is granted by any Congressional Act. None of the cases cited by counsel for appellant, nor in the majority opinion, is authority for the governmental priority claimed.
Amalgamated Utility Workers (C.I.O.) v. Consolidated Edison Co., 309 U.S. 261, 60 S.Ct 561, 84 L.Ed. 738, is relied upon because it recognizes the Board, rather than a labor organization which filed the charges, as the proper party to apply for contempt proceedings against an employer for failure to obey a decree of enforcement. This opinion, and others cited fail utterly to recognize the Board or the Government as the party in interest, as a claimant, nominal or otherwise, of the awards made to discharged employees. The Board is recognized as an agency of government merely in a procedural sense in dealing with unfair labor practices; but neither are in any sense pecuniary beneficiaries. The court there was dealing with the necessity of discriminating between the Board as a procedural agent in court proceedings and private persons or groups, such as the unions interested. It was not attempting to expand the powers or authority of the Board beyond its functions as prescribed by Congress. It says: (309 U.S. loc. cit. 270, 60 S.Ct. loc. cit. 565, 84 L.Ed. 738) “The appropriate procedure to that end is to ask the court to punish the violation of its decree as a contempt”. Reference then is made to the Conference Report that, if unfair labor practice is resumed, “there will be immediately available to the Board an existing court decree to serve as a basis for contempt proceedings.” Civil contempt, of course.
In case of bankruptcy the function of the Board as a procedural agency to assure protection from unfair labor practice, if resumed, has been exhausted. Relief to the wage-earner, if one remains, must be through application to the court. His award is a personal one, not a public or punitive one. It is the court’s decree, not title in the government nor its procedural agency, that is the basis of the redress awarded. 'If the wage-earner has a judgment that can be enforced as a claim in bankruptcy he, and not a procedural agent, has authority to present it. Undoubtedly Congress might so expand the functions of the Board, but it has not done so either expressly or inferentially.
A significant limitation of the Board’s authority is found in Republic Steel Corporation v. National Labor Relations Board, et al., 311 U.S. 7, 61 S.Ct. 77, 85 L.Ed. 6 wherein it is held:
“The National Labor Relations Board, having ordered the reinstatement with back pay of employees found to have been discharged or denied reinstatement in violation of the National Labor Relations Act, and having directed the employer to deduct from the back pay such amounts as were received by the employees from governmental agencies for services performed meanwhile on work relief projects, was without authority further to require the employer to pay over to the governmental agencies the amounts so deducted.”
“We do not think that Congress intended to vest in the Board a virtually unlimited discretion to devise punitive measures, and thus to prescribe penalties or fines which the Board may think would effectuate the policies of the Act. We have said that ‘this authority to order affirmative action does not go so far as to confer a punitive jurisdiction enabling the Board to inflict upon the employer any penalty it may choose because he is engaged in unfair labor practices, even though the Board be of the opinion that the policies of the Act might be effectuated by such an order’. We have said that the power to command affirmative action is remedial, not punitive.” (311 U.S. 7, 11, 12, 61 S.Ct. 77, 79, 85 L.Ed. 6.)
*616This, by strong inference, denies to the Board the governmental status claimed by it.
While it would seem that the Board has exhausted its function to assure protection from unfair conduct on the part of this bankrupt, it is unnecessary for the disposition of the only issue presented in this appeal to do more than hold that the judgment on the motion to expunge be affirmed on the ground that the Board was without authority to file the claim. Such is my view. Even the plea of convenience is lacking. The real claimants are present and their claims are on file. The substantial merits have not been presented. The case should go back, even under the majority opinion, to determine the rights of the individual claimants, and for a sound consideration of the question of priorities in the bankruptcy situation presented.