Chesapeake and Ohio Ry. Co. v. Ford

• Citation: 590 F.2d 557
• Decision Date: 10 January 1979
• Docket Number: No. 77-2083,77-2083
• Parties: 100 L.R.R.M. (BNA) 2322, 85 Lab.Cas. P 11,031 The CHESAPEAKE AND OHIO RAILWAY COMPANY, Appellant, v. Ryland H. FORD, Appellee.
• Court: United States Courts of Appeals. United States Court of Appeals (4th Circuit)

Page 557

590 F.2d 557

100 L.R.R.M. (BNA) 2322, 85 Lab.Cas. P 11,031

The CHESAPEAKE AND OHIO RAILWAY COMPANY, Appellant, v. Ryland H. FORD, Appellee.

No. 77-2083.

United States Court of Appeals Fourth Circuit.

Argued Oct. 2, 1978.

Decided Jan. 10, 1979.

Philip Lee Lotz, Staunton, Va. (Lotz, Black & Menk, Staunton, Va., on brief), for appellant.

Michael McH. Collins, Covington, Va. (Collins, Wilson, Collins & Singleton, Covington, Va., on brief), for appellee.

Before BRYAN, Senior Circuit Judge, and RUSSELL and PHILLIPS, Circuit Judges.

PHILLIPS, Circuit Judge:

Ryland H. Ford sued his employer, the Chesapeake & Ohio Railroad, for $11,197.41 and certain other amounts he asserted were wrongfully withheld from him by the Railroad. The Railroad has appealed from a judgment in favor of Ford reported at 432 F.Supp. 1285 (W.D.Va.1977). Because we believe that Ford was required first to attempt to exhaust his arbitral remedy and that he has failed to do so, we reverse.

On May 1, 1971, Amtrak assumed responsibility for the C & O's passenger service and as an incident to that takeover Ford's job was abolished. Amtrak's organic statute required that it negotiate a protective agreement with the C & O for the benefit of any employees of the Railroad affected by the change in operation and it did so. The resulting agreement, Appendix C-1, was duly approved as "fair and equitable" by the Secretary of Labor. 45 U.S.C. § 565.

Two provisions of Appendix C-1 are pertinent to this litigation. One provided that Ford would receive a guaranteed wage based on his earnings prior to the takeover so long as he complied with certain conditions. The other dealt with the settlement by arbitration of any disputes arising under C-1.

While Ford briefly had a full-time position after the change of operation, from mid-May 1971 until November 1974 he worked irregularly at the C & O's station in White Sulphur Springs, West Virginia, filling in when a regular employee was absent or had the day off. He received the wage guarantee during this period. In November 1974, the Railroad determined that it had overpaid Ford $11,197.41 on the guarantee. From this time until Ford's then existing job was abolished in March 1975, it continued to pay Ford for the work he actually performed, but reduced the guaranteed wage payment to sixty percent for some time, then stopped it completely until by this unilaterally imposed process the alleged overpayment was totally recouped.

Ford, through his union, filed a grievance concerning this process under the dispute adjustment procedure contained in the collective bargaining agreement between the union and the Railroad. The Railroad denied the dispute was subject to that grievance procedure and Ford appealed, but did not prosecute the appeal. No grievance was ever filed under C-1's arbitration clause.

Ford brought suit in state court, the Railroad removed to federal court and then filed a motion to dismiss. The district court denied the motion, holding that it had jurisdiction and that Ford was not required to exhaust his arbitral remedy under C-1. ¹ Following a trial, the court entered judgment for Ford and this appeal was duly noted.

When a dispute between employer and employee is subject to an exclusive arbitration remedy, either party must attempt to use that remedy before resorting to litigation. Republic Steel Corp. v. Maddox, 379 U.S. 650, 85 S.Ct. 614, 13 L.Ed.2d 580 (1965). ² Were this dispute subject to the Railway Labor Act, 45 U.S.C. §§ 151-188, no one could contend that arbitration was not the exclusive remedy. Andrews v. Louisville & N.R.R., 406 U.S. 320, 92 S.Ct. 1562, 32 L.Ed.2d 95 (1972). Although he initially filed a grievance under the Railway Labor Act procedure, Ford now asserts that only Appendix C-1's procedure is potentially applicable and that it does not have this effect. Because we conclude that C-1's procedure is also exclusive, we accept his contention for the purposes of this appeal.

Appendix C-1's arbitration clause provides:

In the event Railroad and its employees or their authorized representatives cannot settle any dispute or controversy with respect to the interpretation, application or enforcement of any provision of this Appendix . . . within 20 days after the dispute arises, it may be referred by either party to an arbitration committee . . . .

The decision . . . of the arbitration committee shall be final, binding and conclusive . . . .

Arbitration provisions in railway labor contracts providing that Either party May invoke arbitration with the resulting decision binding on Both have generally been interpreted to make arbitration the exclusive remedy for both notwithstanding the apparently permissive language employed. Brotherhood of R.R. Trainmen v. Chicago River & I.R.R., 353 U.S. 30, 34, 77 S.Ct. 635, 1 L.Ed.2d 622 (1957); Batts v. Louisville & N.R.R., 316 F.2d 22, 26-27 (6th Cir. 1963); New Orleans & N.R.R. v. Bozeman, 312 F.2d 264, 268 (5th Cir. 1963); See Parsons v. Norfolk & W. Ry., 442 F.2d 1075 (4th Cir. 1971), Aff'g, 310 F.Supp. 1197 (S.D.W.Va.1970). In McLaughlin v. Penn Central Transportation Co., 384 F.Supp. 179, 185...