Sullivan v. Pacific & Arctic Railway & Navigation Co.

Decision Date15 March 1971
Docket NumberNo. 24680.,24680.
PartiesRichard E. SULLIVAN, Plaintiff-Appellant, v. PACIFIC AND ARCTIC RAILWAY AND NAVIGATION COMPANY, Defendant-Appellee.
CourtU.S. Court of Appeals — Ninth Circuit

M. Ashley Dickerson (argued), Anchorage, Alaska, for plaintiff-appellant.

Michael M. Holmes (argued), of Faulkner, Banfield, Boochever & Doogan. Juneau, Alaska, for defendant-appellee.

Before KOELSCH, CARTER and WRIGHT, Circuit Judges.

JAMES M. CARTER, Circuit Judge.

Sullivan brought a common law action for wrongful discharge in the district court against his former employer, Pacific and Arctic Railway and Navigation Company the Company, accepting the discharge as final and asking for money damages. His appeal from the summary judgment,1 entered by the District Court, in favor of the Company raises the issue of whether it was necessary for him, under federal or state law, to exhaust his remedies under a collective bargaining agreement before bringing suit. We conclude that exhaustion of administrative remedies was necessary and affirm the judgment.

Sullivan is a longshoreman whose labor union had a collective bargaining agreement with the Company, which is covered by the Railway Labor Act. The Company employed ten regular men and hired other men to work when regular men were off and when there was additional work. Sullivan had been a regular longshoreman but, in April of 1967, resigned from that status. Later, he was classified as an acceptable extra or casual worker. On May 14, 1968, his first day as a temporary replacement for one of the ten regular men, Sullivan refused his work assignment. The Company informed the Union of this act and advised it that Sullivan was not to be dispatched to the Company again. Sullivan claims that the discharge was discriminatory in that other men had not been discharged for refusing job assignments, and that he was discharged because of his union activities.

The collective bargaining agreement covering Sullivan's employment with the Company provided in section IX(a) that the Company has the "right to reject unsatisfactory men, giving the reason therefor", and provided in section XI for summary dismissal of employees for stated causes. The agreement established procedures for review of discharges by the Company and the Union. It also contained a no strike clause. Section XI provided that a Joint Labor Relations Committee shall meet to review and settle, if possible, any case in which a dock worker has been dismissed. Under Section XIII, the Committee consisted of six representatives, with the Company and the Union each selecting three. If the Committee ruled that the dismissal was unjust, the dockworker was to be reinstated with back pay. If the Joint Labor Relations Committee failed to arrive at a settlement, either party could refer the matter to a Board of Conciliation which consisted of three persons. Both parties selected one member each, and the two members so selected appointed a third member. The majority decision of the Board was final and binding on the parties and could be retroactive. If the parties were unable to reach a decision, the agreement stated that the matter should be handled as set forth in the laws of the United States covering this subject.

At the Union's request, two meetings of the Joint Labor Relations Committee were held. Sullivan did not attend either meeting. The Committee did not rule that Sullivan had been unjustly dismissed. No one referred the dismissal to the Board of Conciliation, or resorted to the remedies of the Railway Labor Act.

Sullivan then brought this action against the Company in the District of Alaska for wrongfully discharging him in violation of the collective bargaining agreement between his union and the Company and in violation of the Railway Labor Act of May 20, 1926, c. 347, 44 Stat. 577, as amended 45 U.S.C. § 151 et seq. The district court granted a summary judgment in favor of the Company on the ground that Sullivan had not exhausted his administrative remedies as required by the law of Alaska, which controlled the action for wrongful discharge.

I.

The Supreme Court has held that a discharged railway employee may either (1) pursue his remedy under the administrative procedures established by an applicable collective bargaining agreement, subject to the Railway Labor Act and a right of review before the National Railroad Adjustment Board, or (2) bring a common law action for damages if he accepts his discharge as final, and if the controlling state law recognizes such an action may be commenced without prior exhaustion of administrative remedies. Moore v. Illinois Cent. R.R., 312 U.S. 630, 61 S.Ct. 754, 85 L. Ed. 1089 (1941); Slocum v. Delaware L. & W. R. R., 339 U.S. 239, 70 S.Ct. 577, 94 L.Ed. 795 (1950); Transcontinental & Western Airline, Inc. v. Koppal, 345 U.S. 653, 73 S.Ct. 906, 97 L.Ed. 1325 (1953). The major issue of this case is whether this court should refuse to follow these decisions in light of the Supreme Court's subsequent decisions in Republic Steel Corp. v. Maddox, 379 U.S. 650, 85 S.Ct. 614, 13 L.Ed.2d 580 (1965), and Walker v. Southern Ry., 385 U.S. 196, 87 S.Ct. 365, 17 L.Ed.2d 294 (1966); specifically should we hold that a discharged employee, such as Sullivan, of a carrier that is subject to the Railway Labor Act is precluded by the Act from resorting to a state recognized cause of action for wrongful discharge without first exhausting his administrative remedies.2

In Moore v. Illinois Cent. R.R., supra, the Supreme Court, in 1941, held that a trainman was not required by the Railway Labor Act to exhaust his administrative remedies under the Act before bringing a suit for damages for wrongful discharge. The Court concluded that the language of 45 U.S.C.A. § 153 First (i), which provides that disputes may be referred to the Adjustment Board, indicated that the administrative remedy was not compulsory. In Slocum v. Delaware L. & W.R.R., supra, the Court, in 1950, held that under the Railway Labor Act, the Adjustment Board had exclusive jurisdiction over a jurisdictional dispute between two unions. Moore was distinguished as a case involving an employee who accepted his discharge as final and brought an action for damages for breach of contract. The Court in Slocum stated: "A common-law or statutory action for wrongful discharge differs from any remedy which the Board has power to provide, and does not involve questions of future relations between the railroad and its other employees." 339 U.S. at 244, 70 S.Ct. at 580. Transcontinental & Western Airline, Inc. v. Koppal, supra, in 1953, confirmed that a discharged airline employee, under provisions similar to the Railway Labor Act, could pursue his administrative remedy or could bring an action for unlawful discharge but only if the applicable state law recognized such a claim and allowed recovery without prior exhaustion of administrative remedies.

This was the law until, in 1965, Republic Steel Corp. v. Maddox, supra, held that contract grievance procedures voluntarily incorporated by the parties in collective bargaining agreements subject to the Labor Management Relations Act, unless specified by the parties to be non-exclusive, must be exhausted before direct legal redress may be sought by an employee.

Maddox involved a suit in a state court against an employer for severance pay under a contract subject to § 301(a) of the Labor Management Relations Act of 1947, 29 U.S.C. § 185(a). The Court said, "Since Moore and Koppal the Court has made it clear that substantial federal law applies to suits on collective bargaining agreements covered by § 204 of the Railway Labor Act, International Assn. of Machinists v. Central Airlines, Inc., 372 U.S. 682, 83 S.Ct. 956, 10 L.Ed. 2d 67, and by § 301(a) of the LMRA, Textile Workers v. Lincoln Mills, 353 U. S. 448, 77 S.Ct. 912, 1 L.Ed.2d 972." 379 U.S. at 655, 85 S.Ct. at 618.

The Supreme Court, in refusing to extend the rationale of Moore,Slocum and Koppal to Maddox's suit for severance pay on a collective bargaining agreement subject to the Labor Management Relations Act, raised doubts about the continued vitality of those cases in the area of the Railway Labor Act. First, federal jurisdiction in Moore and Koppal was based on diversity, and federal law was not thought applicable, even though the collective bargaining agreements were subject to the Railway Labor Act. Since those cases were decided, the Court noted, as quoted supra, that International Assn. of Machinists v. Central Airlines, Inc., supra, had made clear that substantive federal law applies to suits on collective bargaining agreements covered by § 204 of the Railway Labor Act. Second, the Court concluded that, even though a discharged employee accepted his discharge as final the resolution of his claim could have an effect on the future relations between his former employer and the remaining employees.

Despite the doubts raised about the vitality of Moore and its progeny by the analysis in Maddox, the Court in Maddox explicitly refused to overrule it:

"By refusing to extend Moore v. Illinois Central R. Co. to § 301 suits, we do not mean to overrule it within the field of the Railway Labor Act. Consideration of such action should properly await a case presented under the Railway Labor Act in which the various distinctive features of the administrative remedies provided by that Act can be appraised in context, e. g., the make-up of the Adjustment Board, the scope of review from monetary awards, and the ability of the Board to give the same remedies as could be obtained by court suit." 379 U.S. at 657 n. 14, 85 S.Ct. at 619.

The Court's decision in Maddox raised such doubts about the continued vitality of Moore that Justice Black, dissenting in Maddox,3 and two circuit courts4 thought that future overruling of the Moore case certain.

Thereafter, in 1966, the Supreme Court decided Walker v. Southern Ry., supra. In Walke...

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