Court Opinion

ID: 9638788
Source: CourtListenerOpinion
Date Created: 2023-08-22 15:54:00.46761+00
Date Added: 2024-06-11T15:35:31.221588
License: Public Domain

SPARKS, Circuit Judge.,
dissenting.
I approve that part of the majority opinion which reverses the ruling of the district court in dismissing the complaint as to the individual defendants. However, I am unable to assent to that part of the opinion which affirms the ruling of the district court in dismissing the complaint as to the Local Union. I think it was error for the district court to so rule.
We agree that the publication was libelous and that a cause of action is stated against the individual defendants. This being true, a cause of action is likewise stated against the Union, if it is capable of being sued. The majority opinion denies such capability under the common law, and as Illinois has adopted the common law, it argues that we are bound by the law of Illinois in the determination of this question.
In 1845, Illinois enacted a statute that “the common law of England, so far as the same is applicable and of a general nature, and all statutes or acts of the British parliament made in aid of, and to supply the defects of the common law * * *, and which are of a general nature and not local to that kingdom, shall be the rule of decision, and shall be considered as of full force until repealed by legislative authority.” Illinois Statutes, Chapter 28, section 1.
In my judgment the substance of the original rule of common law was that any unincorporated association, labor union or otherwise, was not recognized as a legal entity apart from its members and for that reason it could neither sue nor be sued in its association name. Gradually various theories of estoppel and waiver were evolved to permit such suits in certain instances. In equity the practice became more liberal and more realistic than at law. (37 Ill.Law Review 70). I find nothing in the common law, or the Illinois law, to prevent any unincorporated association from becoming an entity in any legal manner it may choose, and in my judgment this Union has voluntarily done just that.
In United Mine Workers v. Coronado Coal Co., 259 U.S. 344, 42 S.Ct. 570, 66 L.Ed. 975, 27 A.L.R. 762, the Supreme Court of the United States, before the National Labor Relations Act was enacted, held incorporated trade unions suable, on the ground that they had become legal entities.
Under the National Labor Relations Act, 29 U.S.C.A. sections 151-166, the local union here involved has been certified as exclusive collective bargaining agent. It has voluntarily availed itself of that status through the consent of its membership. It makes leases and contracts in its association name, and it is required to be dealt with as a juristic personality and entity entirely separate and apart from its members. No one here questions the validity of that Act, nor does my contention in any manner conflict with the declaration of policy as expressed by Congress in 29 U.S.C.A. § 151.
The Supreme Court of Illinois has never passed upon such facts as are here pleaded. Hence we must, if possible, ascertain the applicable Illinois law “from all the available data,” including the Illinois Appellate Court decisions. West v. American Telephone & Telegraph Co., 311 U.S. 223, 61 S.Ct. 179, 85 L.Ed. 139, 132 A.L.R. 956. None of the Illinois cases purport to pass upon facts such as are here pleaded. This court is not required to follow Appellate Court decisions if they are distinguishable or if this court is “convinced by other persuasive data that the highest court of the state would decide otherwise.” West v. American Telephone & Telegraph Co., supra.
The Illinois cases relied upon in the majority opinion are O’Connell v. Lamb, 63 Ill.App. 652; Cahill v. Plumbers, Etc., Local No. 93, 238 Ill.App. 123; Kingsley v. Amalgamated Meat Cutters, 323 Ill.App. 353, 55 N.E.2d 554; and Montgomery Ward & Co. v. Franklin Union, 323 Ill.App. 590, 56 N.E.2d 476. These cases merely adhere to appellees’ interpretation of the old common law rule, that an unincorporated association can neither sue nor be sued, which means that such an association can become a legal entity only by incorporation. Other earlier Illinois Appellate cases are quite in conflict with the cases upon which appellees rely. The first two of the cases relied upon were decided many years before the Congressional enactment here involved, and the latter two cases merely cite and follow the first two, and in neither case was the question now before us present, considered or decided, this is to say — can an unincorporated association attain legal en*498tity by means other than incorporation. The Appellate Court of Illinois seems to have passed on this question in 1941, adversely to these defendants’ contentions in L. E. Almon v. American Carloading Corp., 312 Ill.App. 225, 38 N.E.2d 362, 364. There the unincorporated labor union was not a party to the action but the pleadings disclosed that the only defense interposed was made by direction of the Joint Council in behalf of the Local Union. While the defendants were sued personally the defense interposed by them was one which would have the effect of adjudicating the claims of that union. The court there said: “Notwithstanding earlier decisions to the contrary the later and better authorities are to the effect that associations such as Joint Council No. 25 and Local Union No. 710 have ‘juristic personalities.’ ” Citing United Mine Workers v. Coronado Coal Co., 259 U.S. 344, 42 S.Ct. 570, 66 L.Ed. 975, 27 A.L.R. 762, annotated in 27 A.L.R. 762; Franklin Union No. 4 v. People, 220 Ill. 355, 370-372, 77 N.E. 176, 4 L.R.A.,N.S., 1001, 110 Am.St.Rep. 218. The writer of the Almon opinion, supra, participated in the Montgomery Ward case, supra, and concurred in its result. The writer of the opinion in the latter case participated and concurred, not merely in the result, but in the opinion in the Almon case, supra.
The factual allegations of this complaint demonstrate that this Union is, and acts, as a juristic entity, and by its motion to dismiss the complaint it has admitted those facts. It may be urged that whether the Labor Union is a juristic entity is a question of law and not of fact, however, it seems to me that such facts are admitted as impel the conclusion of law that the Union is a legal entity. If this be not true then Congress is placed in the unenviable attitude of authorizing a non-entity to carry out the provisions of the Act, which in my judgment would be not only inconceivable, but would render the Act unenforceable, at least in Illinois, for lack of a qualified enforcing agent. We have had numerous cases in this court, under this Act, where various citizens of Illinois have been compelled by court order, much to their sorrow, to deal with a labor union in the manner contemplated by the Act. We know of none who has not regarded such union as a legal entity in a very real sense.
It may also be urged that Congress gave legal entity to this Union for certain purposes only and that such status will not extend beyond those purposes and their accomplishment. Assuming without conceding this to be true, it is clear that the purposes of the Act by which the status was acquired were to secure, by bargain and contract in the name of and by the Union, better wages and better working conditions for its members, so as to avoid any interference with interstate commerce, in which plaintiff is engaged. The accomplishment of such ends would depend largely, if not entirely, upon the employer’s income and profits. It is concerning these items that the articles complained of are admitted to have been published by the Union. Whether they state the truth we do not know. That fact can only be determined by a trial court. If they were not true they were libelous,’ and they were designed to create in the minds of the reading public, including the members of the Union, a harmful opinion of the employer, and a belief that it was not compensating its employees in a manner consistent with its net income. It cannot well be doubted that the object of the publications was to create public sentiment, which, if based on truth, would be a great factor in accomplishing the very purpose of the Act. The Act gave the Union as an entity a plenitude of power to accomplish the purposes honestly and it required the employer to honestly deal with the Union as an entity in the accomplishment of the same purposes. The Union was given the right in its own name to bargain, and contract, and as an entity to enforce such contract in courts of law. To say that either Congress or the Labor Union intended that the employer could not likewise seek relief in a court of law against the same entity for fraudulently accomplishing the purposes of the Act, would be to attribute to them a characteristic which, to say the least, would not be charitable.
This same view is held by the English Courts from whence our Common Law derives. In The Taff Vale Railway Company v. The Amalgamated Society of Railway Servants, 1 British Ruling Cases (Lawyers Cooperative Publishing Co.) 832, the King’s Bench Division of the House of Lords, Mr. Justice Farwell presiding, held that an unincorporated trade union, registered under the Trade Union Acts of 1871, and 1876, may be sued in its registered name, because the Legislature in giving the trade union the capacity to own property and to act by agents, without incorporating it, had given *499it two of the essential qualities of a corporation “* * * essential, I mean, in respect of liability for tort, for a corporation can only act by its agents, and can only be made to pay by means of its property. The principle on which corporations have been held liable in respect of wrongs committed by its servants or agents in the course of their service and for the benefit of the employer * * * is as applicable to the case of a trade union as to that of a corporation. If the contention of the defendant society were well founded, the Legislature his authorized the creation of numerous bodies of men capable of owning great wealth and of acting by agents with absolutely no responsibility for the wrongs that they may do to other persons by the use of that wealth and the employment of those agents. They would be at liberty * * * to disseminate libels broadcast, * * * and their victims would have nothing to look to for damages but the pockets of the individuals, usually men of small means, who acted as their agents. That this is a consideration that may fairly be taken into account appears from the opinion of the judges given to the House of Lords in the Mersey Docks case. L.R. 1 H.L. 120.” Mr. Justice Farwell entered two orders. The first was that plaintiff was legally entitled to sue the Union in tort, the other enjoined the society from continuing the tort. In entering the latter order he used 'his language: “Therefore, if it is any longer necessary to grant an injunction, I grant an injunction against the defendant society * * *.” Damages were not specifically demanded. The prayer was only for an “injunction and such further relief as the court might direct.” It is quite evident that the legal principles here announced are as applicable to suits at law as to equitable proceedings, for the predominant question decided is purely legal, and the case was brought into equity only by the nature of the demand.
True this decision is based largely, but not en'irely, upon the English Acts of 1871 and 1876, which of course could alter the Common Law so far as F.ngland is concerned. However, the opinion states: “The cases having the nearest analogy to the present are those like Ruck v. Williams (1858) 3 Hurlst. & N. 308 * * * and Whitehouse v. Fellows (1861) 10 C.B.N.S. 765, * * * where unincorporated improvement commissioners and the trustees of a turnpike road respectively, sued under their respective acts in the name of their clerk, were held liable in tort.” It will be noted that the decisions relied upon were pronounced many years prior to the statutes referred to, and shortly after the Illinois Act. From this I am convinced that the highest English Court, as early as 1858, did not regard the Common Law rule to be that no unincorporated association could attain legal entity, so as to sue or be sued, without first becoming incorporated. The two orders of Justice Farwell were set aside by the Court of Appeal. However, the House of Lords reversed the Court of Appeal and restored the judgments of Justice Farwell.
Aside from this phase of the case I think the plaintiff must prevail. We have no National Common Law, as such. However, our federal courts will apply the Common Law of each state severally where the jurisdiction of such state is affected, providing the Common Law of that State is not inconsistent with the requirements of our Federal Constitution. Illinois having adopted that Constitution will not be permitted to enforce its own law, common or statutory, which is inconsistent with our Constitution or the valid Congressional enactments under it. Constitution Article VI. The Labor Relations Act deals with interstate commerce, and the general welfare of all of our citizens, more particularly with those who labor. Congress clothed this union with much more power than that with which Parliament clothed the Amalgamated Society of Railway Servants, supra, and our Supreme Court has said that they rightfully did so.
In my judgment, the local union here involved, operating, as it is, under present Federal and State laws, is not a naked unincorporated association as that term was originally understood. It is operating under a Federal law which clearly makes it a legal entity (Cf. Moffat Tunnel League v. United States, 289 U.S. 113, 53 S.Ct. 543, 77 L.Ed. 1069), and the Illinois courts are bound to recognize it as such. Constitution of the United States Art. VI; H. J. Heinz Co. v. N. L. R. B., 311 U.S. 514, 61 S.Ct. 320, 85 L.Ed. 309. Illinois courts recognize that duty. Staley v. Illinois Cent. R., 268 Ill. 356, 109 N.E. 342, L.R.A.1916A, 450.
I think the ruling of the district court in sustaining defendants’ motions to dismiss the complaint should be reversed.