Akron, Canton & Youngstown R. Co. v. Barnes

• Decision Date: 10 August 1954
• Docket Number: No. 11116-11161.,11116-11161.
• Citation: 215 F.2d 423
• Parties: AKRON, CANTON & YOUNGSTOWN R. CO. et al. v. BARNES et al.
• Court: U.S. Court of Appeals — Seventh Circuit

215 F.2d 423 (1954)

AKRON, CANTON & YOUNGSTOWN R. CO. et al. v. BARNES et al.

No. 11116-11161.

United States Court of Appeals, Seventh Circuit.

August 10, 1954.

Kenneth F. Burgess and D. Robert Thomas, Chicago, Ill., Howard Neitzert, Walter J. Cummings, Jr., Martin M. Lucente, William K. Bachelder, Chicago, Ill., for appellant; Sidley, Austin, Burgess & Smith, Chicago, Ill., of counsel.

Lester P. Schoene, Washington, D. C., Alex Elson, Chicago, Ill., Milton Kramer, Washington, D. C., Clarence M. Mulholland, Toledo, Ohio, Edward J. Hickey, Jr., Washington, D. C., for appellees; Schoene and Kramer, Washington, D. C., Mulholland, Robie & Hickey, Washington, D. C., of counsel.

Before LINDLEY, SWAIM, and SCHNACKENBERG, Circuit Judges.

LINDLEY, Circuit Judge.

Plaintiffs, constituting the principal railroads of the United States, sued in the District Court for a declaratory judgment as to their statutory duty as interstate carriers to bargain upon two specific proposals submitted by defendants, bargaining agents for plaintiffs' employees, under the pertinent provisions of the Railway Labor Act, 45 U.S.C.A. § 151 et sequi. The District Court dismissed the amended complaint because it believed that the facts presented did not present a justiciable controversy. The only issue before us on appeal is whether this determination was correct.

Accepting the averments of the complaint as true, as the court was bound to do, they reveal that defendants submitted certain written proposals to plaintiffs in negotiation of new union contracts. These included establishment of an insurance and welfare plan and free transportation for the affected employees and their families. Plaintiffs took the position that this subject matter did not affect "rates of pay, rules, and working conditions" as defined in the Railway Labor Act, 45 U.S.C.A. § 151a and refused to bargain with reference thereto. Defendants, on the other hand, refused to bargain on any other proposals, unless these two were included. Thus the parties reached a stalemate and negotiations ended.

The dispute was referred to the National Mediation Board, which exhausted its statutory function without resolution of the controversy and terminated its services. Defendants then circulated a strike ballot among the employees, the results of which are not known. On December 28, 1953, the President created an Emergency Board to investigate and report to him with respect to the controversy. On May 15, 1954, the Board issued its report in which it held "that the questions as to whether the demands of the labor organizations for a health and welfare plan and for free transportation come within the language of the Railway Labor Act are `questions which the Board does not feel it should attempt to answer. They are questions involving statutory construction and for the courts to determine.'"

The amended complaint averred further that "The conference, negotiation and bargaining procedure established by Congress in the Railway Labor Act with respect to the making and maintaining of agreements concerning rates of pay, rules and working conditions has been and is being interfered with and thwarted by the wrongful action of the organizations * * * and of the employees whom they represent in insisting that the `free transportation' and `health and welfare' proposals are properly negotiable under the Railway Labor Act and in refusing to bargain and negotiate with respect to the plaintiffs' proposals and the other proposals set out in the May 22, 1953 notice unless plaintiffs agree to bargain and negotiate upon the `free transportation' and `health and welfare' proposals, all to the injury and detriment both of the plaintiffs and of the public. In addition to the injury through such interference with the statutory bargaining process, plaintiffs' public relations are threatened through the wrongful insistence and announcement of the said organizations that plaintiffs have violated and are violating their duty under the Railway Labor Act; a substantial portion of the public may cease dealing with plaintiffs and prospective employees may seek work elsewhere. The economic harm to plaintiffs, to the public and to other employees of plaintiffs which is threatened by way of strikes is predicated on the wrongful insistence of the said organizations and the employees whom they represent upon bargaining and negotiation with respect to the `free transportation' and `health and welfare' proposals and upon their refusal to bargain and negotiate as to their other May 22, 1953 proposals and the proposals of plaintiffs unless plaintiffs agree to bargain and negotiate as to those `free transportation' and `health and welfare' proposals."

Plaintiffs prayed that the court "declare and decree (a) that the said proposals to amend the existing agreements between the individual plaintiffs and their employees represented by the organizations named in Paragraph 5 of this Complaint so as to provide as set forth under the captions `Health and Welfare Plan,' `Rights to Free Transportation' and `Rules Applicable to Both Home Road and Foreign Road Transportation' do not affect or concern `rates of pay, rules, or working conditions' within the meaning of those terms in the Railway Labor Act; (b) that the said proposals are not proper subject matter for the collective bargaining required of plaintiffs by the Railway Labor Act; (c) that the plaintiffs are subject to no legal obligation or duty under the terms of the Railway Labor Act or otherwise to confer, treat, bargain or negotiate with their employees or the representatives of their employees as to the subject matter of the said proposals; and (d) that the plaintiffs have such other and further relief as may be just in the circumstances of this case."

If plaintiffs are to prevail, a substantial controversy affecting present legal interests of the parties must be found to exist on the basis of this factual statement. Those interests must be determined in the light of the Act, the purposes of which pertinent to this inquiry are defined in Section 2, 45 U.S.C.A. § 151a, as follows: "(4) to provide for the prompt and orderly settlement of all disputes concerning rates of pay, rules, or working conditions; * * *." Section 2, First, imposes the duty on all carriers to "exert every reasonable effort" to make agreements respecting rates of pay, rules and working conditions, "and to settle all disputes, whether arising out of the application of such agreements or otherwise," in order to prevent interruptions of commerce. 45 U.S.C.A. § 152, First. Section 2, Sixth prescribes the procedure for convening conferences "In case of a dispute * * * arising out of grievances or out of the interpretation or application of agreements concerning rates of pay, rules, or working conditions." 45 U.S.C.A. § 152, Sixth. Either party to a dispute may invoke the services of the National Mediation Board in cases of "(a) A dispute concerning changes in rates of pay, rules, or working conditions not adjusted by the parties in conference", and "(b) Any other dispute not referable to the National Railroad Adjustment Board and not adjusted in conference between the parties or where conferences are refused." 45 U.S.C.A. § 155, First.

Plaintiffs contend on appeal that the Act imposes on them a duty to treat with employee representatives only with respect to "rates of pay, rules, or working conditions;" that these terms do not include the health and welfare and free transportation proposals; and that the dispute between the parties and the stalemate on the interpretation of plaintiffs' duty under the Act presents a justiciable controversy.

The purpose of the Declaratory Judgments Act, 28 U.S.C. § 2201, is to remove uncertainty from legal relations and clarify, quiet and stabilize them before irretrievable acts have been undertaken; Delaney v. Carter Oil Co., 10 Cir., 174 F.2d 314, certiorari denied Dille v. Delaney, 338 U.S. 824, 70 S.Ct. 71, 94 L. Ed. 501; to avoid multiplicity of suits; Crosley Corp. v. Hazeltine Corp., 3 Cir., 122 F.2d 925, certiorari denied 315 U.S. 813, 62 S.Ct. 798, 86 L.Ed. 1211; and to provide a remedy to a suitor, who otherwise can not have his question adjudicated until his adversary takes the initiative. Employers' Liability Assur. Corp. v. Ryan, 6 Cir., 109 F.2d 690, certiorari dismissed 311 U.S. 722, 60 S.Ct. 1107, 85 L.Ed. 470. The courts quite generally agree that it was the intent of Congress to afford means for settlement of relief for uncertainties respecting legal rights whether before or after a stage of coercion has been reached. See Sunshine Mining Co. v. Carver, D.C., 41 F.Supp. 60; Hann v. Venetian Blind Corp., D.C., 15 F.Supp. 372, affirmed 9 Cir., 111 F.2d 455. Thus, in the Sunshine case, the District Court took jurisdiction where a mining company brought suit against labor unions for a declaration that plaintiff was not engaged in interstate commerce. A civil service employee may have a declaratory judgment as to whether the statute justifies his threatened discharge. United Public Workers of America v. Mitchell, 330 U.S. 75, 67 S.Ct. 556, 91 L. Ed. 754; In American Federation of Labor v. W. U. Tel. Co., 6 Cir., 179 F.2d 535, the court held that the District Court had jurisdiction of an action by a labor union for a declaratory judgment as to the interpretation of an existing contract, while in Bowie v. Gonzales, 1 Cir., 117 F.2d 11, the decision was that the District Court had jurisdiction of an action for declaratory judgment to the effect that Congress intended to exempt certain employees from the provisions of the Fair Labor Standards Act, 29 U.S.C.A. § 201 et seq. and that, because of the conflicting contentions concerning the applicability of the Act to certain employees, a justiciable controversy existed. In Oil Workers International Union, Local No. 463, v. Texoma Natural Gas Co., 5 Cir., 146 F.2d 62, certiorari denied 324 U.S. 872, 65 S.Ct....