Christiansen v. Local 680 of Milk Drivers & Dairy Employees of N.J.

• Decision Date: 03 January 1940
• Parties: CHRISTIANSEN et al. v. LOCAL 680 OF MILK DRIVERS AND DAIRY EMPLOYEES OF NEW JERSEY et al.
• Court: New Jersey Court of Chancery

10 A.2d 168

126 N.J.Eq. 508

CHRISTIANSEN et al.

v. LOCAL 680 OF MILK DRIVERS AND DAIRY EMPLOYEES OF NEW JERSEY et al.

Court of Chancery of New Jersey.

Jan. 3, 1940.

Syllabus by the Court.

1. Motion to strike counterclaim on the ground it does not state a cause of action is in substance a demurrer and admits every allegation of the counterclaim which is well pleaded.

2. A counterclaim must itself set forth the facts relied upon as ground for relief and not depend on the bill or other pleadings. It may, however, refer to and expressly adopt specific parts of the bill in order to avoid unnecessary repetition.

3. Collective bargaining contract between employer and labor union not only enters into the contract of employment between the employer and an individual workman, but also circumscribes the rights of the employer and members of the union with respect to making individual contracts of employment. It creates legal rights and duties which are independent of particular hirings.

4. Collective contract is enforceable by or against individual members of the union in matters which affect them peculiarly, and by or against the union in matters which affect all the members alike or large classes of members.

5. The union cannot maintain an action to compel reinstatement of four of its members discharged from employment in violation of collective contract. The cause of action belongs to the men discharged.

6. Contract between a single employer and a labor union providing for exclusive employment of its members is not prima facie unlawful. But when the contract by itself, or in conjunction with other similar contracts, or understandings or usages imposes a closed shop in substantially an entire industry throughout a considerable area, the burden arises of justifying the contract by showing special circumstances.

7. When the employer repudiates agreement with union, on the ground that it was procured by fraud, the union may sue for a declaratory judgment that the contract is valid and binding.

Action by Carl Christiansen and others against Local 680 of the Milk Drivers and Dairy Employees of New Jersey, the Tuscan Dairy Farms and others, wherein Local 680 of the Milk Drivers and Dairy Employees of New Jersey filed a counterclaim against the Tuscan Dairy Farms. On motion to strike the counterclaim.

Motion denied.

Louis L. Feinseth and Julius Stein, both of Newark, for Tuscan Dairy Farms, Inc.

Thomas L. Parsonnet, of Newark, for Local 680, and others.

BIGELOW, Vice Chancellor.

Tuscan Dairy Farms, a defendant against which is exhibited the supplemental counterclaim of its co-defendant Local 680 of the Milk Drivers and Dairy Employees, moves to strike the counterclaim on the ground that it does not state a cause of action. The motion is, in substance, a demurrer and, like a demurrer, admits every allegation of the counterclaim which is well pleaded. Vineland v. Maretti, 93 N.J.Eq. 513, 117 A. 483; Kuskin v. Guttman, 98 N.J.Eq. 617, 130 A. 829; Id., 99 N.J.Eq. 887, 132 A. 922; Baum v. Canter, 104 N.J.Eq. 224, 144 A. 588; New Order B. & L. Ass'n v. Landau, 156 A. 276, 9 N.J.Misc. 969.

The pleading in question is named a supplemental counterclaim because it shows certain matters which have arisen since a former counterclaim was filed. However, it repeats all the statements of the original counterclaim and is obviously intended by the pleader to stand alone, in place of the first counterclaim. A counterclaim must itself set forth the facts relied upon as ground for relief, and not depend on the original bill or other pleadings. I do not mean that it is improper for the counterclaim to refer to and expressly adopt specific parts of the bill. This is permissible to avoid unnecessary repetition. But the counterclaim cannot be otherwise aided by the bill. 21 C.J. 507. Of course, the bill must be inspected to see whether the counterclaim is germane.

The case made by the counterclaim follows :

On July 21, 1939, the Dairy Company and the Union entered into a contract, the terms of which I will quote at length:

"1. This agreement shall cover every employee of the Company as defined hereafter.

"2. The Company agrees to employ or keep in its employ only members of the Union in good standing; provided that persons now employed by the Company who are not now members in good standing of the Union shall be given Five (5) Days to make application for membership in the Union, and the Union agrees to accept them as new members without discrimination, provided further that in the event of a vacancy, such vacancy shall be filled by an individual who shall be competent and who shall meet the employment requirements of the Company, and in filling such vacancy first consideration shall be given an individual, if available, who is a member of the Union. Should any employee be suspended or expelled from the Union because of an infraction of Union rules, the Company agrees to discharge such employee within Seven (7) Days after receiving notice in person from properly authorized Union official as to such infraction and expulsion or suspension.

"3. The Company agrees that it will deduct, upon proper authorization by the employees on the second pay day of each month from the wages of its employees a sum equal to such employees' monthly dues and assessments to the Union and remit same to the Union at such time.

"4. It is further agreed that the parties hereto hereby expressly make themselves parties to the Collective Bargaining Negotiations now taking place before Mr. Arthur S. Meyers, who is now conducting such negotiations on behalf of the Mayor of the City of New York, between Local Unions of the International Brotherhood of Teamsters, Chauffeurs, Stablemen and Helpers of America, affiliated with the American Federation of Labor and Metropolitan Milk Bargaining Agency, for it for the purpose of said negotiations. Said agreement to apply to the employees as specifically classified in this Contract.

"The parties hereto hereby expressly agree to be bound by any Agreement resulting from aforesaid negotiations and also agree to be bound by all of the terms and conditions of any Contract resulting therefrom, provided however that with respect to the parties hereto, the provisions of such contract will take effect retroactively as of the date hereof with respect to the employees classified in this contract. Until such time as such contract shall become effective, all terms and conditions of employment now in effect shall continue, but no employee shall be discharged or laid-off, nor shall any terms or conditions of employment of any employee be changed or altered."

Notwithstanding the contractual provisions, the Dairy Company failed and refused to make itself a party to the New York negotiations. Those negotiations, however, culminated on November 4, 1939, when the Milk Dealers Committee on behalf of the "milk dealers" and committees for Locals 338, 584, and 680 approved the terms of an agreement "with the express understanding that each committee will sponsor and recommend its ratification and acceptance." The draft contract so approved is made part of the counterclaim and is in form a voluminous agreement to be executed by a single employer on the one part and a local union on the other.

Meanwhile,—that is, before the conclusion of the New York negotiations,— Tuscan notified counterclaimant that it rescinded the agreement of July 21, 1939, on the ground it had been obtained by fraud. The union denies any fraud.

The counterclaim is filed to enforce the contract with Tuscan and, as part thereof, the New York contract. The National Labor Relations Act, 29 U.S.C.A. § 151 et seq., was discussed on the argument of the...