Chabot v. Prudential Ins. Co. of America

• Court: Rhode Island Supreme Court
• Writing for the Court: BAKER; O'CONNELL
• Citation: Chabot v. Prudential Ins. Co. of America, 77 R.I. 396, 75 A.2d 317 (R.I. 1950)
• Decision Date: 04 August 1950
• Docket Number: No. 1911,1911
• Parties: CHABOT et al. v. PRUDENTIAL INS. CO. OF AMERICA. Eq.

Page 317

75 A.2d 317

77 R.I. 396

CHABOT et al. v. PRUDENTIAL INS. CO. OF AMERICA.

Eq. No. 1911.

Supreme Court of Rhode Island.

Aug. 4, 1950.

James J. McAleer, Ambrose W. Carroll, Providence, for complainants.

Perkins, Higgins & McCabe, James A. Higgins, all of Providence for respondent.

James E. Flannery, Providence, Leonard B. Boudin, New York City, for intervening respondents.

BAKER, Justice.

This is a bill in equity brought by four individual complainants, on behalf of themselves and thirty-five other individuals with a common interest all being formerly members of a labor union, in order to have their employer enjoined from continuing to deduct dues and assessments from their wages and paying them over to the union under a collective bargaining agreement, and for incidental relief. The cause was heard in the superior court on bill, answers and proof and a final decree was entered denying and dismissing the bill. Thereafter an appeal was duly prosecuted to this court by the complainants.

It appears from the record that before the suit was heard in the superior court the United Office and Professional Workers of America, an unincorporated association and a national union, hereinafter referred to as the union, and its secretary-treasurer were by order of that court permitted to intervene as parties respondent. The other respondent is The Prudential Insurance Company of America, hereinafter called the company, which is engaged in interstate commerce and does an insurance business in this state and in other parts of the United States. The complainants were all industrial insurance agents employed by the company and were previously members of the Industrial Insurance Agents Union, Local 36, an unincorporated subordinate association hereinafter termed the local, which was affiliated with said national union.

It is undisputed that prior to and at the time of the happening of the events which were the cause of the bringing of the present bill the union was, under the provisions of the National Labor Relations Act, the duly authorized and recognized collective bargaining agency for the complainants and others in their dealings with the company. On June 24, 1946 the union and the company had entered into a collective bargaining agreement which by its terms was to continue in force until October 1, 1948 and was automatically to be extended for a period of one year, after which time it was to continue from year to year unless either party should notify the other in writing at least sixty days before October 1, 1948, or before the end of any such yearly period, of its election that it should not be so extended.

The agreement also provided that the company should check off and deduct from the wages of members of the union, after proper authorization by them, monthly union dues to be remitted to the secretary-treasurer of the union provided, however, that any such deduction could be terminated by the union member by giving the company written notice thereof, the termination, however, to become effective at the end of the period in which such notice was given. The above agreement, which was substantially national in scope and covered a large number of union members in thirty-one states, contained a provision to the effect that employment would not be conditioned on membership in the union.

The evidence shows that under date of April 21, 1947 the local was notified by letter from the president of the union that it was suspended pursuant to a specific provision of the constitution of the union because of its failure to pay certain assessments, and an administrator was appointed to conduct its affairs. On May 9, 1947 a special meeting of the local was held at which it was voted to sever relations with and disaffiliate from the union. Furthermore the by-laws of the local were thereupon amended to bring about that result and the name of the local was changed. Under dates of May 24 and June 10, 1947, the company was sent thirty-nine slips signed by the respective complainants, revoking prior authorizations to deduct union dues from their wages and pay such dues to the union. On May 31, 1947 the secretary-treasurer of the union wrote a letter to the local enclosing certain findings and the decision of the executive board in relation to the charges previously made against the local. As a result of such findings and decision the charter of the local was revoked by the union. On June 3, 1947 the company notified the complainants' solicitor that, in spite of the revocations above referred to, it would continue to deduct and check off dues from the complainants' wages.

The instant bill was filed June 12, 1947. It is alleged therein that the deductions which the company threatened to make from the wages of the complainants were unlawful and illegal as being contrary to the provisions of the aforesaid collective bargaining agreement and also contrary to the statutes of this state relating to the weekly payment of wages. The pertinent statute thus relied on is Public Laws 1941, chapter 1069, as amended by P.L.1942, chap. 1237, hereinafter called the weekly wage payment law. In referring to the payment of weekly wages, sec. 2 of the chapter last mentioned contains the following language: 'Every such employer shall pay such wages in full in lawful money of the United States, or checks on banks, convertible into cash on demand at full face value thereof.' Section 5 of chapter 1069 provides among other things that the provisions of the law may not be waived or set aside by a private agreement between employer and employee.

The complainants further argue that as members of a voluntary association for an indefinite period they had the right to withdraw at any time without being obliged to continue to pay dues thereto, and that it is inequitable and improper that they should have to pay such dues by way of checkoff when they are no longer members of the union which itself first suspended and thereafter revoked the charter of the local to which they belonged.

The respondents, however, maintain in substance that employees, especially a minority in one state for whom a collective bargaining agreement was duly made, may not at will repudiate and cancel it during its term; that the statute of this state regulating the weekly payment of wages does not make illegal the deduction of union dues under an agreement between an employer and an accepted collective bargaining agent; and if a statute of this state prevents checkoff provisions in such agreements it cannot properly apply to the facts herein because of its conflict with the National Labor Relations Act, 29 U.S.C.A. § 151 et seq., and cannot restrain the right to bargain collectively for the checkoff of union dues.

In connection with the issues thus raised P.L.1947, chap. 1944, which took effect June 3, 1947 and reads as follows, has been called to our attention: 'Section 1. Chapter 292 of the general laws, entitled 'Assignment of wages,' as amended, is hereby further amended by adding thereto the following section: 'Sec. 9. Deduction of Union or Craft Dues. None of the foregoing sections of this chapter shall be applicable to or control or prohibit the deduction of labor or trade union or craft dues or other obligations imposed by a collective bargaining contract, or subscriptions to a nonprofit hospital service corporation established under chapter 719 of the public laws, 1939, from wages of an employee by an employer in accordance with a written request made by the individual employee.' Sec. 2. This act shall take effect upon its passage and all acts and parts of acts inconsistent herewith are hereby repealed.'

In the case of Shine v. John Hancock Mutual Life Ins. Co., R.I., 68 A.2d 379, where the facts closely resemble those in the instant case, we recently had occasion to pass on and discuss fully many of the issues now before us. Strictly speaking in our judgment chapter 1944, which we have just quoted, has no application in the case at bar since the pertinent collective bargaining agreement was entered into June 24, 1946 and that statute, which is not retroactive, did not go into effect until June 3, 1947. However, in view of certain peculiar facts and extensive arguments appearing in the instant cause, we will assume for the present purposes that such chapter has a bearing herein.

Upon consideration we are of the opinion that in enacting chapter 1944 the general assembly intended to amend and to change only the assignment of wages act by providing in substance that such act should not control or prohibit the checkoff of union dues or other obligations imposed by a collective bargaining agreement or subscriptions to a nonprofit hospital service corporation by an employer from his employees' wages in accordance with the latter's written request to that effect. Moreover, it is our judgment that chapter 1944 did not in any manner, either directly or by necessary implication, amend the weekly wage payment law of this state. An examination of chapter 1944 shows that by its express language it applies specifically only to the chapter of the general laws relating to assignment of wages, and that it also provides in particular that none of the foregoing sections of that chapter shall prevent the checkoff of union dues and the other matters referred to therein. To give chapter 1944 such a comprehensive and extended construction as would make it apply also to another chapter, namely, the weekly wage payment law, would in effect be writing into the act material provisions which the legislature itself did not see fit to include.

Further it may be noted that P. L. 1947, chap. 1945, which immediately followed chap. 1944 and which also went into effect June 3, 1947, was an amendment to the weekly wage payment law. Significantly, however, it did not contain any reference to checkoff and relates solely to a matter not pertinent herein. It is fair to assume that if the general...