Lewis v. Benedict Coal Corporation

• Decision Date: 26 September 1958
• Docket Number: 13056.,No. 13055,13055
• Citation: 259 F.2d 346
• Parties: John L. LEWIS, Charles A. Owen and Josephine Roche, as Trustees of the United Mine Workers of America Welfare and Retirement Fund, Appellants, v. BENEDICT COAL CORPORATION, Appellee. UNITED MINE WORKERS OF AMERICA, and United Mine Workers of America, District 28, Appellants, v. BENEDICT COAL CORPORATION, Appellee.
• Court: U.S. Court of Appeals — Sixth Circuit

259 F.2d 346 (1958)

John L. LEWIS, Charles A. Owen and Josephine Roche, as Trustees of the United Mine Workers of America Welfare and Retirement Fund, Appellants, v. BENEDICT COAL CORPORATION, Appellee.

UNITED MINE WORKERS OF AMERICA, and United Mine Workers of America, District 28, Appellants, v. BENEDICT COAL CORPORATION, Appellee.

Nos. 13055, 13056.

United States Court of Appeals Sixth Circuit.

September 26, 1958.

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E. H. Rayson and R. R. Kramer, Knoxville, Tenn. (Val J. Mitch and Harold H. Bacon, Washington, D. C., James N. Hardin, Greeneville, Tenn., Willard P. Owens, Washington, D. C., on the brief), for appellants.

Robert T. Winston, Jr., Norton, Va. (S. J. Milligan, Greeneville, Tenn., on the brief), for appellee.

Before SIMONS, Chief Judge, and MILLER and STEWART, Circuit Judges.

STEWART, Circuit Judge.

The parties to these consolidated appeals are John L. Lewis, Charles A. Owen, and Josephine Roche, as Trustees of the United Mine Workers of America Welfare and Retirement Fund; Benedict Coal Corporation; United Mine Workers of America; and United Mine Workers of America, District 28. For economy the parties will be referred to, respectively, as the Trustees, Benedict, the International Union, and District 28 (and the latter two collectively as the Unions). The United Mine Workers of America Welfare and Retirement Fund will be referred to as the Fund.

This action originated when the Trustees sued Benedict, a coal mine operator, to recover royalties allegedly due the Fund under the National Bituminous Coal Wage Agreement of 1950 and the amendment to said agreement of 1952, with respect to coal mined by Benedict from March, 1950, to July, 1953. The agreements in question were negotiated between the International Union and an employer association representing Benedict and other employers. Under the agreements Benedict was obligated to pay the Fund thirty cents for each ton of coal it produced during part of the period involved and forty cents for each ton it produced during the remainder of the period. Cf. Lewis v. Quality Coal Corporation, 7 Cir., 1957, 243 F.2d 769. Although Benedict did make some payments to the Fund for coal mined during the period in question, it was stipulated before trial that additional coal had been mined by Benedict upon which royalties in the amount of $76,504.26 had not been paid.

Benedict's answer to the complaint denied liability upon the ground that the Trustees were beneficiaries of the 1950-52 agreement between Benedict and the International Union, that therefore any defenses, counterclaims, or set-offs which Benedict had against the International Union were available against the Trustees, and that the International Union had breached the agreements by causing a series of strikes, all of which were in violation of the agreements and two of which were also in violation of the Labor Management Relations Act of 1947, damaging Benedict in excess of the amount sought by the Trustees. Benedict also defended upon the ground that even if the International Union had not been responsible for the strikes, the misconduct of Benedict's individual employees constituted a defense to the Trustees' action, because these employees were beneficiaries of the Trust.

In addition to its answer filed in response to the Trustees' complaint,¹ Benedict filed a cross-claim against the Unions, claiming damages resulting from the series of strikes between April, 1950, and May, 1953, allegedly caused or ratified by the Unions in violation of the aforesaid agreements and, in the case of two of these strikes, also allegedly in violation of the secondary boycott provisions of the Labor Management Relations Act of 1947. The cross-defendant Unions denied any violation on their part of either the agreements or the federal statute.

After a lengthy trial the issues were submitted to a jury, upon instructions that damages to Benedict caused by wrongful acts of its employees would constitute a defense to the Trustees' action, but that Benedict could recover on the cross-claim only upon a finding that wrongful acts of the individual employees had been caused or ratified by the Unions. The jury returned a verdict finding that the Trustees were entitled to recover unpaid royalties in the stipulated amount of $76,504.26, and that Benedict was entitled to a set-off against this amount of $81,017.68, the amount in which the jury found in the cross-claim that Benedict had been damaged by the Unions. In accordance with his interpretation of the jury's verdict the district judge entered judgment for Benedict against the Unions for $81,017.68 and granted execution of the same. He further entered judgment in favor of the Trustees against Benedict in the amount of $76,504.26, but instead of ordering execution upon this judgment, provided that it should be paid, under the administration of the court, from the proceeds of Benedict's judgment against the Unions.² From this judgment the Trustees have appealed, as have the Unions.

The issues presented by the appeals of the Unions will be dealt with first, since their determination affects the disposition of the Trustees' appeal. The many errors claimed by the Unions relate to three basic issues: (1) Did any or all of the strikes in question violate the agreement of 1950-52 or the Labor Management Relations Act if they were caused by the Unions? (2) If so, was there sufficient evidence to support a finding that either District 28 or the International Union was responsible for any or all of the strikes? (3) If so, were the damages assessed against the Unions excessive?

At the outset the Unions deny liability for damages resulting from the strikes on the ground that the right to strike was preserved in the 1950-52 agreement. It is true that the agreement expressly stated that the "no strike" provisions of the previous contracts were superseded.³ However, the agreement provided in detail the procedure to be followed for the settlement of localized disputes or grievances.⁴ This procedure was also made exclusive and obligatory by the following provisions:

"3. The contracting parties agree that, as a part of the consideration of this contract, any and all disputes, stoppages, suspension of work and any and all claims, demands or actions growing therefrom or involved therein shall be by the contracting parties settled and determined exclusively by the machinery provided in the `Settlement of Local and District Disputes\' section of this Agreement; or, if national in character, by the full use of free collective bargaining as heretofore known and practiced in the industry.

"4. The United Mine Workers of America and the Operators signatory hereto affirm their intention to maintain the integrity of this contract and to exercise their best efforts through available disciplinary measures to prevent stoppages of work by strike or lockout pending adjustment or adjudication of disputes and grievances in the manner provided in this agreement."

These sections were revised in the 1952 amendment, but the obligation to resort to the specified procedure was not substantially changed.⁵

Determination of this preliminary issue thus depends upon what effect the agreement to settle all local disputes in accordance with the "Settlement of Local and District Disputes" procedure had upon the right to strike which was expressly preserved in the 1950-52 agreement. The question is not without precedent. The same basic issue was thoroughly considered in United Construction Workers v. Haislip Baking Co., 4 Cir., 1955, 223 F.2d 872, 873; W. L. Mead, Inc., v. International Brotherhood of Teamsters, etc., D.C., 126 F.Supp. 466, affirmed 1 Cir., 1956, 230 F.2d 576; and International Union, United Mine Workers of America v. National Labor Relations Board, D.C.Cir., 257 F.2d 211. With all respect for the majority view expressed in the latter decision, we agree with the dissenting judge in that case, and with the decisions in the Haislip and Mead cases, that a strike to settle a dispute which a collective bargaining agreement provides shall be settled by an exclusive and obligatory alternative procedure constitutes a violation of the agreement.

This conclusion does not make meaningless the express abrogation of a no strike clause in the 1950-52 agreement. The right to strike was preserved with respect to all disputes not subject to settlement by other methods made exclusive by the agreement. Moreover, the Unions remained free from liability for spontaneous or "wildcat" strikes. Such spontaneous strikes would be the kind of "stoppages" and "suspensions of work" which the agreement made subject to the settlement procedure therein provided.

Viewing the eleven work stoppages in question by these standards, and without stating the facts in detail, we conclude that the evidence was insufficient to show that the stoppage of September, 1950, the "Water Strike" and the stoppage of January 10-11, 1951, the "Collingsworth Strike," were concerted strikes resulting from a labor dispute. These were clearly spontaneous work stoppages, and consequently, they did not constitute violations of the 1950-52 agreement. As to the remaining strikes, we conclude that, except for the "Wage Stabilization Strike" of October, 1952, the evidence was sufficient to support the jury's determination that they resulted from localized labor disputes which were cognizable under the settlement procedure provided by the agreement.⁶ The October, 1952, strike resulted from the refusal of the operators to pay negotiated wage increases in the absence of approval by the Wage Stabilization Board. Being national in scope, this dispute was not under the agreement subject to settlement on the local or district level.

The second basic contention of the International Union and District 28 is that even if the agreement prohibited strikes with respect to local disputes, the strikes in question were not authorized or...