Tam v. Rutledge

• Decision Date: 20 August 1979
• Docket Number: Civ. No. 78-0315.
• Citation: 475 F. Supp. 559
• Court: U.S. District Court — District of Hawaii
• Parties: Richard A. T. TAM, Romeo Mindo, Frances McCallum, Hajime Tsuda, Lucille Toyama, Teodorico Reyes, Laura Ching, Tiofelo Rofoli, Kathy Roque, Reuben Aea, Michael Akamine, John Caudillo and Melvin Nakaima, Plaintiffs, v. Arthur A. RUTLEDGE, Anthony Rutledge, Sally Gomes, Rita Kubota, Lois Reeves, Hotel and Restaurant Employees and Bartenders Union Local 5, and Hotel & Restaurant Employees and Bartenders International Union, Defendants.

475 F. Supp. 559

Richard A. T. TAM, Romeo Mindo, Frances McCallum, Hajime Tsuda, Lucille Toyama, Teodorico Reyes, Laura Ching, Tiofelo Rofoli, Kathy Roque, Reuben Aea, Michael Akamine, John Caudillo and Melvin Nakaima, Plaintiffs, v. Arthur A. RUTLEDGE, Anthony Rutledge, Sally Gomes, Rita Kubota, Lois Reeves, Hotel and Restaurant Employees and Bartenders Union Local 5, and Hotel & Restaurant Employees and Bartenders International Union, Defendants.

Civ. No. 78-0315.

United States District Court, D. Hawaii.

August 20, 1979.

Arthur Y. Park, Sean Kim, Gill, Park & Park, Honolulu, Hawaii, for plaintiffs.

William A. Sokol, Van Bourg, Allen, Weinberg, Williams & Roger, San Francisco, Cal., John R. Desha, II, Honolulu, Hawaii, for defendants Arthur A. Rutledge, Anthony Rutledge, Sally Gomes, Rita Kubota, Lois Reeves, and Hotel and Restaurant Employees and Bartenders Union Local 5.

Albert Brundage, Brundage, Davis, Frommer & Jesinger, San Francisco, Cal., for defendant Hotel & Restaurant Employees and Bartenders International Union.

DECISION ON COUNT ONE

SAMUEL P. KING, Chief Judge.

SUMMARY

The imposition and continuance of a trusteeship on Hotel and Restaurant Employees and Bartenders Union Local 5 (Local 5), by the Hotel & Restaurant Employees and Bartenders International Union (International Union or International) is attacked by certain members of Local 5.¹

Plaintiffs raise several questions regarding the trusteeship.² First, plaintiffs contend that a trusteeship may not be imposed without a prior fair hearing. Second, plaintiffs contend that this trusteeship was not established for an allowable purpose. Third, plaintiffs contend that this trusteeship was not established in good faith. Fourth, plaintiffs contend that the post-imposition hearing held by the International was not a fair hearing. Fifth, plaintiffs contend that the relevant credible evidence adduced at the hearing did not substantiate any of the charges made. Sixth, plaintiffs contend that this trusteeship is not being maintained in good faith.

Another issue not raised by plaintiffs but which I raise sua sponte is: Seventh, whether the imposition of a trusteeship ousts the Secretary of Labor of jurisdiction to conduct a supervised election in a pending civil action.

I conclude that a trusteeship may be imposed without a prior hearing, that this trusteeship was established for an allowable purpose and in good faith, that the post-imposition hearing was a fair hearing, that the relevant credible evidence adduced at the hearing did substantiate most of the charges made, that the trusteeship is being maintained in good faith, and that a trusteeship does not oust the Secretary of Labor of jurisdiction to conduct a supervised election in a pending civil action.

FINDINGS AND CONCLUSIONS

The governing principles of law in this matter are derived from the Labor-Management Reporting and Disclosure Act (LMRDA), 29 U.S.C. Chapter 11.

Section 302 of the Act, 29 U.S.C. § 462, provides:

Trusteeships shall be established and administered by a labor organization over a subordinate body only in accordance with the constitution and bylaws of the organization which has assumed trusteeship over the subordinate body and for the purpose of correcting corruption or financial malpractice, assuring the performance of collective bargaining agreements or other duties of a bargaining representative, restoring democratic procedures, or otherwise carrying out the legitimate objects of such labor organization.

Section 304(c) of the Act, 29 U.S.C. § 464(c),³ provides:

In any proceeding pursuant to this section a trusteeship established by a labor organization in conformity with the procedural requirements of its constitution and bylaws and authorized or ratified after a fair hearing either before the executive board or before such other body as may be provided in accordance with its constitution or bylaws shall be presumed valid for a period of eighteen months from the date of its establishment and shall not be subject to attack during such period except upon clear and convincing proof that the trusteeship was not established or maintained in good faith for a purpose allowable under section 462 of this title. After the expiration of eighteen months the trusteeship shall be presumed invalid in any such proceeding and its discontinuance shall be decreed unless the labor organization shall show by clear and convincing proof that the continuation of the trusteeship is necessary for a purpose allowable under section 462 of this title. In the latter event the court may dismiss the complaint or retain jurisdiction of the cause on such conditions and for such period as it deems appropriate.

These statutory provisions do not require a fair hearing before imposition of a trusteeship over a local union by an international union.⁴ They do require a fair hearing either before or after imposition of a trusteeship. While the present language of the quoted statutes logically does not require any hearing at all but only provides that, if a fair hearing is held, the trusteeship shall enjoy a presumption of validity for eighteen months that cannot be overcome except by clear and convincing proof, the legislative history and general purposes of the LMRDA indicate that Congress intended a requirement of a fair hearing to authorize or ratify the imposition of a trusteeship. The LMRDA allows for the possibility of post hoc ratification as well as prior approval so long as the post hoc ratification is provided for in the union's constitution or bylaws and the hearing follows with reasonable promptness. National Association of Letter Carriers v. Sombrotto, 449 F.2d 915 (2d Cir. 1971); Jolly v. Gorman, 428 F.2d 960 (5th Cir. 1970), cert. denied, 400 U.S. 1023, 91 S.Ct. 588, 27 L.Ed.2d 635 (1971); Plentty v. Laborers' International Union of No. America, 302 F.Supp. 332 (E.D.Pa.1969); but cf. International Brotherhood of Electrical Workers Local 1186 v. Eli, 307 F.Supp. 495 (D.Hawaii 1969) (fair hearing requirement only goes to presumption of validity of trusteeship and is not a requirement of a valid trusteeship in the first instance). See Local U. 13410, United Mine Workers v. United Mine Workers, 154 U.S.App.D.C. 322, 329-331, 475 F.2d 906, 913-915 (1973). Cf. Bailey v. Dixon, 429 F.2d 1321 (5th Cir. 1970) (preliminary injunction against trusteeship issued before post hoc hearing could be held); Local No. 2, Int. Bro. of Tel. W. v. International Bro. of Tel. W., 261 F.Supp. 433 (D.Mass.1966) (no fair hearing held, and procedures not specified in constitution or bylaws); Flight Engineers Inter. Ass'n v. Continental Air Lines, Inc., 297 F.2d 397 (9th Cir. 1961) (international union cannot impose trusteeship on local union where there is no provision therefor in the constitution or bylaws of the international).

The Constitution of the International Union, effective July 26, 1976, contains a separate Article VI of 9 sections on Trusteeship.⁵ The sections of specific application to this case are Sections 1, 2, and 3. These sections provide in relevant part, that, when any of the conditions specified in Section 1(a) exist,⁶ the General President may order a Trustee to take charge and control of the affairs and property of a local union. In doing so, the General President shall instruct the General Secretary-Treasurer to prepare a notice of charges setting forth the reasons for the trusteeship, which notice of charges shall be served upon the local union, through any of its officers, prior to or simultaneously with the establishment of the trusteeship. When, in the opinion of the General President, delay would be contrary to the best interests of the local union or of the International Union, a Trustee may be ordered to temporarily take charge and control of the affairs and property of the local union prior to a hearing but after or simultaneously with service of the notice of charges. After the service of notice of charges, or appointment of Trustee without hearing, whichever is later, a hearing shall be held to determine whether the trusteeship shall be instituted or continued.⁷ The General President shall appoint a member of the International Union to conduct the hearing and make a report to the General President with respect to the institution or dissolution of the trusteeship. The General President shall render his decision in the matter after considering the oral or written evidence presented. His decision is appealable to the General Executive Board.

The written record on this trusteeship begins with a letter dated August 18, 1978, to General President Edward Hanley, from five members of the executive board,⁸ requesting that the International Union immediately order a Trustee to take charge and control of the affairs and property of Local 5 in accord with Article VI of the Constitution of the International Union. The letter states that "an emergency exists" and that "a trusteeship is necessary to restore democratic procedures to Local 5."⁹

On August 23, 1978, General Secretary-Treasurer John Gibson of the International Union wrote to "Sisters and Brothers" of Local 5, copies to Herman Leavitt, Administrative Assistant to the General President, and Arthur Rutledge, President of Local 5, and Richard Tam, Secretary-Treasurer of Local 5, setting forth "Notice of Charges" in accordance with Article VI Section 1(b) of the Constitution of the International Union. The letter states that Mr. Gibson is writing pursuant to instructions from the General President, that in the opinion of the General President an emergency exists, a trusteeship is necessary, any delay would be detrimental to the best interests of the local and of the international, and a Trustee should immediately take charge and control of the affairs and property of Local 5 simultaneously with service of "this Notice of Charges."¹⁰

Respectfully and fraternally yours /s/ John Gibson JOHN GIBSON General Secretary-Treasurer ...