Chartier v. Marlin Mgmt.

• Decision Date: 01 August 1999
• Docket Number: AFL-CIO,Docket No. 99-7263
• Citation: 202 F.3d 89
• Parties: (2nd Cir. 2000) ROBERT L. CHARTIER, as President of the Service Employees International Union, Local 32E,, for an order confirming an award in arbitration pursuant to Section 7510 of the CPLR, and judgment pursuant to Section 7514 of the CPLR, Petitioner-Appellee, v. MARLIN MGMT., LLC, also known as Marlin Management of NY LLC, Respondent- Appellant, 3205 GRAND CONCOURSE CORP. and MARTIN SHAPIRO, individually and jointly and severally, Respondents
• Court: U.S. Court of Appeals — Second Circuit

Page 89

202 F.3d 89 (2nd Cir. 2000)

ROBERT L. CHARTIER, as President of the Service Employees International Union, Local 32E, AFL-CIO, for an order confirming an award in arbitration pursuant to Section 7510 of the CPLR, and judgment pursuant to Section 7514 of the CPLR, Petitioner-Appellee, v. MARLIN MGMT., LLC, also known as Marlin Management of NY LLC, Respondent- Appellant, 3205 GRAND CONCOURSE CORP. and MARTIN SHAPIRO, individually and jointly and severally, Respondents.

Docket No. 99-7263

August Term, 1999

UNITED STATES COURT OF APPEALS SECOND CIRCUIT

Argued: Sep. 28, 1999

Decided: Jan. 11, 2000

Appeal from a final judgment entered in the United States District Court for the Southern District of New York (Kaplan, J.), granting petitioner-appellee's application to confirm an arbitration award and dismissing the counterclaims of respondent-appellant, the court having found, inter alia, that the latter was obligated to arbitrate the dispute giving rise to the award because the Civil Court for the City of New York had previously determined that respondent-appellant was bound by a collective bargaining agreement to which its predecessor in title was a party.

Affirmed in part; vacated and remanded in part.

JEFFREY S. DUBIN, Huntington, New York, (Robert M. Saltzstein, Huntington, NY, on the brief) for Respondent-Appellant.

CHRISTOPHER A. SMITH, Bronx, New York, for Petitioner-Appellee.

Before: MESKILL, MINER, and PARKER, Circuit Judges.

MINER, Circuit Judge:

Respondent-Appellant Marlin Management, LLC ("Marlin") appeals from a judgment entered in the United States District Court for the Southern District of New York (Kaplan, J.), confirming an arbitration award against Marlin in favor of petitioner-appellee, Robert L. Chartier, as President of the Service Employees International Union, Local 32E, AFL-CIO (the "Union"). The judgment also dismissed Marlin's counterclaims for federal labor law violations. Marlin purchased a residential building located at 3205 Grand Concourse, Bronx, New York (the "Building") from respondent, 3205 Grand Concourse Corporation (the "Seller"), whose managing member is respondent Martin Shapiro. The Union contended that Marlin bought the property subject to a previously negotiated Collective Bargaining Agreement ("Agreement") between the Union and the Seller that provided for mandatory arbitration of all disputes involving the Seller and the Union, as the representative of its members. Marlin denied being subject to the Agreement or its mandatory arbitration clause. Thereafter, Marlin discharged and sought to evict the Building's Superintendent, Marco A. Cardona ("Cardona"), a member of the Union, who was entitled to occupy an apartment in the building by virtue of his employment. The Civil Court for the City of New York, Bronx County (the "Civil Court") dismissed Marlin's summary dispossess proceeding against Cardona, holding that Marlin was bound by the Agreement, and therefore must first follow the requirements of the arbitration clause as it related to the disputed discharge of Cardona.

After the action in the Civil Court was dismissed, the Union commenced an arbitration proceeding against Marlin, although Marlin elected not to participate in the proceeding. Following the arbitrator's determination that Marlin's discharge of Cardona was improper, Marlin and Cardona apparently returned to Civil Court. The Civil Court approved a tentative agreement between the parties and entered an Order marking the "matter" off the calendar "with no res judicata or collateral estoppel effect on any other proceeding[ ]." The district court subsequently confirmed the arbitration award, giving preclusive effect to the first decision of the Civil Court, and holding that Marlin was bound by the Agreement's arbitration clause. The district court later denied Marlin's motion for reconsideration, finding that the "new dispossess proceeding" before the Civil Court could not affect the "conclusive" nature of the prior Civil Court determination that Marlin was subject to the Agreement. (emphasis in original).

For the reasons that follow, we affirm in part and vacate in part the judgment of the district court and remand for further proceedings consistent with this opinion.

BACKGROUND

Marlin purchased the Building from the Seller on June 18, 1997. Prior to the sale of the Building, the Seller and the Union had entered into the Agreement, which covered the period March 15, 1995 to March 14, 1998. The Seller also had employed Cardona as the Building Superintendent and provided him with an apartment free of rent and utility charges as a benefit of his employment. Pursuant to the contract of sale, Marlin "agree[d] to acquire the premises subject to the employment of [Cardona]." However, the contract of sale did not specifically refer to the Agreement. Between June and November of 1997, the Union and Marlin communicated several times regarding the Agreement. The Union contended that Marlin was subject to the Agreement, and Marlin denied that it was subject to the Agreement.

On December 11, 1997, Marlin discharged Cardona, allegedly for cause. By letter to Marlin, the Union requested a meeting to discuss the discharge, but Marlin refused to meet with the Union. Marlin then began a summary dispossess proceeding against Cardona in the Civil Court to evict Cardona from his apartment in the Building, contending that his discharge as superintendent terminated his right to possession.

On February 17, 1998, the Civil Court (Tao, J.) dismissed Marlin's summary dispossess proceeding. Judge Tao's decision stated as follows:

[Cardona's] motion to dismiss this proceeding is granted. After careful consideration of the papers submitted, the Court finds that [Marlin], pursuant to the contract of sale, is bound by the terms of the union agreement executed between the prior landlord and [Cardona]. Such terms require that prior to initiating a summary proceeding, [Marlin] must follow the requirements set forth under Article 22, chapter 6 of the union contract regarding disputed discharge cases. Such requirements have not been met here and as a result the instant proceeding was not properly commenced.

Based upon the foregoing, the instant matter is dismissed. This is without prejudice to [Marlin] commencing a new proceeding if the arbitrator's award sustains the discharge.

The Union had instituted an arbitration proceeding on the theory that Marlin was bound by the Agreement and the arbitration clause. Asserting that Marlin's discharge of Cardona violated the terms of the Agreement, the Union sought Cardona's reinstatement as well as an award of damages and other relief. The arbitration hearing was held on February 24, 1998. Marlin did not attend the arbitration hearing or participate in any other way in the arbitration. In fact, Marlin had previously written to the arbitrator, stating that it was not a proper party to the arbitration and would not participate.

On March 20, 1998, the arbitrator issued his decision. The arbitrator found that the Union and Marlin¹ were "parties" to the Agreement, "which provide[d] for the Arbitration of unresolved disputes." Considering whether Marlin had just cause to terminate Cardona, the arbitrator held that Marlin had "failed to carry its burden of proof by a preponderance of credible evidence" that Cardona's "conduct warranted dismissal." Consequently, the arbitrator directed Marlin to pay the Union approximately $5,500 in damages and fees and to reinstate Cardona "immediately with full back pay, plus interest . . . from the date of his improper discharge."

Thereafter, Marlin and Cardona apparently returned to the Civil Court. On April 28, 1998, the court "So Ordered" a stipulation between the parties. The stipulated Order read as follows:

It is agreed that this matter is marked off [the] calendar with no res judicata or collateral estoppel effect on any other proceedings. Commencing with May [19]98 respondent [Cardona] will pay $300.00 a month as use and occupancy for the [Apartment].

He will continue to do so until there is a final federal [court] decision . . . on confirmation of arbitration award. If determination is in Respondent's favor[,] then all use and occupancy paid will be repaid to Respondent. If money [is] not paid, Petitioner [Marlin] may move on 3 days notice for [judgment] of possession.

(footnote omitted).

The Union subsequently brought suit in state court, petitioning for confirmation of the arbitration award and for a judgment on the award pursuant to New York CPLR Article 75. Marlin removed the action to federal court and counterclaimed for federal labor law violations. In November 1998, after the parties filed cross-motions for summary judgment, they consented to a bench trial before the district court, "on . . . the record . . . before the Court on the parties' motions for summary judgment."

On November 24, 1998, the district court issued a decision to grant the Union's petition to confirm the award against Marlin with a modification. See Chartier v. 3205 Grand Concourse Corp., 27 F. Supp. 2d 472 (S.D.N.Y. 1998). After reviewing the facts it deemed most salient, the district court proceeded to consider whether the arbitrator meant to enter an award against Marlin or the Seller.² The court concluded that "[w]hile there remains an issue as to whether Marlin was obliged to arbitrate, there is no doubt whatever that the arbitrator meant to enter an award against Marlin." Id. at 474. Accordingly, the court modified the arbitration award so that Marlin was identified as the party against which the award was rendered.

The court then considered whether the award, as modified to make Marlin a party, should be confirmed in light of Marlin's contention that it never submitted to arbitration. The court stated as follows:

Marlin's position is straightforward and not without appeal. Arbitration is a matter of contract. As a general proposition, "a part...