Boyd Leedom v. Int'l Bhd. Of Elec. Workers

• Decision Date: 16 December 1959
• Docket Number: 15377.,Nos. 15346,s. 15346
• Parties: Boyd LEEDOM et al., as Chairman and Members of NationalLabor Relations Board, Appellants,v.INTERNATIONAL BROTHERHOOD OF ELECTRICAL WORKERS, LOCAL UNIONNO. 108, AFL-CIO, Appellee.GENERAL CABLE CORPORATION, Appellant,v.Boyd Stewart LEEDOM et al., individually and as Chairman andMembers of and Constituting National LaborRelations Board, Appellees.
• Court: U.S. Court of Appeals — District of Columbia Circuit

278 F.2d 237

107 U.S.App.D.C. 357

Boyd LEEDOM et al., as Chairman and Members of NationalLabor Relations Board, Appellants, v.INTERNATIONAL BROTHERHOOD OF ELECTRICAL WORKERS, LOCAL UNIONNO. 108, AFL-CIO, Appellee.GENERAL CABLE CORPORATION, Appellant, v.Boyd Stewart LEEDOM et al., individually and as Chairman andMembers of and Constituting National LaborRelations Board, Appellees.

Nos. 15346

15377.

United States Court of Appeals District of Columbia Circuit.

Argued Dec. 16, 1959.Decided March 24, 1960.

Mr. Duane B. Beeson, Atty., National Labor Relations Board, of the bar of the Supreme Court of California, pro hac vice, by special leave of court, with whom Messrs. Thomas J. McDermott, Associate Gen. Counsel, National Labor Relations Board, and Marcel Mallet-Prevost, Asst. Gen. Counsel, National Labor Relations Board, were on the briefs, for appellants in No. 15346 and appellees in No. 15377. Mr. James C. Paras, Atty., National Labor Relations Board, also entered an appearance for appellants in No. 15346 and appellees in No. 15377.

Mr. Joseph C. Wells, Washington, D.C., with whom Mr. Lawrence T. Zimmerman, Washington, D.C., was on the brief, for appellant in No. 15377.

Mr. William J. Brown, Washington, D.C., with whom Mr. Louis Sherman, Washington, D.C., was on the brief, for appellee in No. 15346.

Before WILBUR K. MILLER, BAZELON and BURGER, Circuit Judges.

BAZELON, Circuit Judge.

On May 1, 1957, the International Brotherhood of Electrical Workers, Local No. 108, AFL-CIO entered into a three-year collective bargaining agreement with the General Cable Corporation covering its production and maintenance employees at Tampa, Florida. The contract bar rule then in effect had been announced by the National Labor Relations Board in 1953 in General Motors Corp., 102 N.L.R.B. 1140. It provided that, during the life of any bargaining agreement with a term up to five years, no representation proceedings could be instituted by a labor organization not a party to that contract, provided a substantial part of the industry involved was covered by contracts of a similar term. It is undisputed that General Cable is a part of an industry which qualified for a three-year bar.

In September 1958--some 16 months after the present contract was entered into--the Board revised its policies and announced that a contract would not bar an election after two years regardless of its terms. Pacific Coast Ass'n of Pulp & Paper Mf'rs, 121 N.L.R.B. 990. Thereafter, in June 1959--ten months before the expiration of the instant three-year contract--the Board applied this reduced bar term in representation proceedings instituted by a Company employee and ordered an election to be held on July 23, 1959. Shortly before that date, the Union and the Company filed separate suits in the District Court to enjoin the Board from conducting ghe scheduled election. The District Court issued a temporary order under which the election was held and the uncounted ballots were impounded in the Board's custody where they remain pending, disposition of this litigation. After hearing on the pleadings and affidavits, the court held that the Company 'has an adequate statutory procedure for obtaining review of the determination of which it complains.' Accordingly, it dismissed the Company's suit. The Company appeals in No. 15377.

With respect to the Union, however, the court concluded that it had jurisdiction because the Board's action 'amounted to a retroactive application of new policy * * * and as such constituted an abuse of discretion and therefore amounted to a deprivation of property without due process of law.' It thereupon granted the Union's request for a preliminary injunction. The Board appeals in No. 15346.

I.

We think the District Court was clearly correct in dismissing the Company's suit on the ground that an adequate statutory review procedure is available.¹ By refusing to bargain with any newly elected representatives of its employees, the Company will incur a 8 unfair labor practice charge, ² against which it may assert the illegality of the election as a defense. Judicial review of any adverse decision in such proceedings is authorized by 10(f) or 10(e).³

II.

We turn now to the Board's appeal from the District Court's exercise of jurisdiction to grant relief to the Union.

Ordinarily, Board determination in 9(d)⁴ 'representation proceedings are reviewable only in the courts of appeals and only when they have become the basis for a 'final order' in an unfair labor practice proceeding under 10. * * *' Leedom v. Kyne, 1957, 101 U.S.App.D.C. 398, 249 F.2d 490, 491, affirmed 1958, 358, U.S. 184, 79 S.Ct. 180, 3 L.Ed.2d 210. To obtain review of such determination in an original equity suit in the District Court, 'there must be a showing 'of unlawful action by the Board and resulting injury * * * by way of departure from statutory requirements or from those of due process."⁵ The Union claims here, as it did below, that the retroactive application of the shortened contract bar term violates the requirements of due process. We are constrained to hold that it does not.

III.^5A

This conclusion is reached with considerable difficulty by the writer of this opinion. Antipathy to retroactive lawmaking by legislatures and courts has deep historical roots.⁶ It is only by comparing the problem of retroactivity in those areas with the comparatively new area of administrative law that I am able to find special considerations which adequately support our conclusion.

The fundamental unfairness of retrospective legislation is recognized in American constitutional theory. Although the prohibition against ex post facto law bars only retrospective criminal statutes, Calder v. Bull, 1798, 3 Dall. 386, 3 U.S. 386, 1 L.Ed. 648, the courts have often reached similar results with civil legislation through the impairment of contracts, ⁷ and due process clauses.⁸ The vice inherent in retroactivity is, of course, that it tends to destroy predictability and to undercut reliance--both important aims of the law.⁹

But in most areas of law, the need for predictability must compete with the need for change. Thus in reviewing legislation of retroactive effect, the virtues of stability must be balanced with the benefits of progress. Accordingly courts have often upheld statutes which cut off or modified private contracts where it appeared that the legislation sought to attain social purposes of greater importance than predictability and reliance.¹⁰ Indeed the modern trend is to scrutinize more and more carefully the substance of the 'vested rights' which have often been asserted in condemnation of retroactive legislation.¹¹

Judicial decisions overruling prior case law present another context for the problem of retrospective application of law.¹² The Supreme Court has disavowed some early cases which appeared to hold it an unconstitutional impairment of the obligation of contracts for a state court to overrule retrospectively a prior decision.¹³ But as a matter of equitable discretion, courts will apply a judgment overruling a prior decision only prospectively in order to avoid 'gross injustice.'¹⁴ This is particularly true in the field of contract law, where agreements were made in reliance upon the earlier rule.¹⁵

Finally, the problem of retroactivity asserts itself in the comparatively new domain of administrative law. Here many of the considerations with respect to retroactive legislation and adjudication are relevant. Regulatory agencies often exercise both functions. But there are additional factors to be considered arising out of the special functions and purposes for which these agencies were in large part created to perform. The Supreme Court dealt with this newer area in the second Chenery case.¹⁶ There the agency, sitting in an adjudicatory capacity, developed and applied a new rule of fiduciary responsibility with respect to corporate reorganizations. The Court pointed out that an administrative body, 'unlike a court, does have the ability to make new law prospectively through the exercise of its rule-making powers, (and hence has) less reason to rely upon ad hoc adjudication to formulate new standards of conduct * * *.' But it also said that a rigid rule requiring an agency to proceed in the first instance by rule-making would rob the administrative process of needed flexibility. 332 U.S. at page 202, 67 S.Ct. at page 1580. In approving the Commission's action in that case, the Court formulated the following test: '(The evils of retroactivity) must be balanced against the mischief of producing a result which is contrary to a statutory design or to legal and equitable principles. If that mischief is greater than the ill effect of the retroactive application of a new standard, it is not the type of retroactivity which is condemned by law.' 332 U.S. at page 203, 67 S.Ct. at page 1581. In short, we must determine which is the 'lesser evil.'¹⁷

IV.

We turn now to the application of these principles to the instant case. On the one hand, we must weigh the Union's contentions that it entered into the three-year contract in reliance upon the former contract bar rules. More specifically, it asserts that a premature election threatens to deprive it of its contractual right to continued peaceful recognition, and will put it to the expense of an otherwise unnecessary organizational campaign.

The Board does not deny that the Union may have relied upon the existing bar when negotiating the contract. Nor does it gainsay that retroactive application of the new bar may work a hardship upon the Union. Rather it points out that periodic adjustments in its contract bar rules are necessary to maintain, at all times, a proper balance between the competing statutory objectives of (1) statbility in industrial relations, and (2) employee freedom of choice in selecting their bargaining representatives.¹⁸ It further contends that immediate application of its revised rule was necessary to prevent 'an...