General Building Contractors' Ass'n v. Local Unions No. 542
| Decision Date | 24 March 1952 |
| Citation | 370 Pa. 73,87 A.2d 250 |
| Parties | GENERAL BLDG. CONTRACTORS' ASS'N et al. v. LOCAL UNIONS NOS. 542, 542-A and 542-B et al. |
| Court | Pennsylvania Supreme Court |
Argued November 13, 1951
Appeal, No. 185, Jan. T., 1951, from order and decree of Court of Common Pleas No. 5 of Philadelphia County, March T. 1951, No. 4413, in case of General Building Contractors' Association; Pennsylvania Excavators' Association and the Contractors' Association of Philadelphia v. Local Unions Nos. 542, 542-A and 542-B; International Union of Operating Engineers and Roy J. Underwood, etc. Decree affirmed.
Bill in equity. Before SMITH, P.J. and ALESSANDRONI, J.
Rule for preliminary injunction granted, and decree entered awarding injunctive relief. Defendants appealed.
Decree affirmed, at cost of appellants.
Abraham E. Freedman, with him Freedman, Landy & Lorry , for appellants.
Henry W. Maxmin , with him Myron Jacoby, Jacoby & Maxmin, Manus McHugh and A. Bernard Hirsch , for appellees.
Before DREW, C.J., STERN, STEARNE, BELL, LADNER and CHIDSEY, JJ.
General Building Contractors' Association, Pennsylvania Excavators' Association and Contractors' Association of Philadelphia, appellees, filed their bill in equity to restrain Local Unions, Nos. 542, 542A and 542B, International Union of Operating Engineers, and Roy J. Underwood, individually, and as president and business manager, appellants, from acting in disregard of an existing collective bargaining agreement between the parties. After a preliminary hearing before two judges, a preliminary injunction was issued granting the relief prayed for.
Plaintiff, General Building Contractors' Association, is a nonprofit organization having as members a large number of contractors engaged in construction of industrial, commercial, institutional and other buildings, with an affiliate group of a number of steel erectors. Plaintiff, Pennsylvania Excavators' Association, an unincorporated association, has approximately fourteen members doing large excavating work. Plaintiff, Contractors' Association of Philadelphia, a nonprofit corporation, consists of about fifty-five contractors engaged in construction of bridges, roads, highways, subways and heavy sewer lines. The three associations act as negotiating agents for their constituents in consummating collective bargaining agreements with employes. Defendants are Local Unions No. 542, 542A and 542B, International Union of Operating Engineers, an unincorporated association, and Roy J. Underwood, its president and business manager.
Plaintiffs and defendants on October 7, 1949, entered into a retroactive written collective bargaining agreement for a term of one year to expire April 30, 1950. The agreement was signed by Roy J. Underwood for defendants, by William F. Lotz, president of General Building Contractors' Association, by John Buckley, president of Pennsylvania Excavators' Association, and by Harry R. Halloran, chairman of the board of directors of Contractors' Association of Philadelphia.
The Union in February, 1950 notified the respective plaintiffs of the termination of the agreement. By letter of February 15, 1950, Underwood wrote, "We shall be pleased to discuss with you at your convenience the terms and conditions of a new agreement to become effective May 1, 1950." Plaintiffs advised Robert G. Kelly, Esquire, attorney for the Union, that any wage increases would be resisted.
Harry R. Halloran and Robert G. Kelly, representing plaintiffs and defendants respectively, had negotiated and prepared the collective bargaining agreement of October 7, 1949 covering the year May 1, 1949 to April 30, 1950. These individuals acted because group or committee meetings had become too acrimonious to achieve results. The same individuals for the same reason carried on negotiations for their respective principals for an agreement to become effective May 1, 1950. Kelly suggested that a welfare fund might be established. Halloran advised Kelly that no increase in wage could be granted but that it might be possible to work out an arrangement for a working welfare fund.
Underwood was authorized by the Union to negotiate for a welfare fund subordinating other issues such as wage rates and working conditions. Halloran, at the suggestion of Kelly, secured authority from the plaintiff associations to negotiate such collective bargaining agreement and was advised by Kelly that the latter had secured similar authority from the defendants. All negotiations and communications between the parties during the months of March and April, 1950 were restricted to Kelly and Halloran. The two negotiators agreed that in consideration of creation of a welfare fund, the existing collective bargaining agreement would be extended for a period of two years. The employers were required to contribute to such fund 10 per each man hour worked. This agreement was verbally made on April 14, 1950, by Kelly and Halloran, to become effective as of May 1, 1950.
Thereafter Halloran and Kelly engaged in drafting the terms of the trust necessary for establishing the welfare fund which culminated in the execution on August 17, 1950 (effective as of May 1, 1950) of a comprehensive trust agreement. Meanwhile a strike threatened for May 1, 1950 did not materialize. Prior to the execution of this instrument, at the request of Halloran, Kelly reduced to writing the oral agreement reached by them on April 14, 1950 as agents for their respective principals. This was captioned "Addendum Dated April 14, 1950, to Agreement and Working Rules Dated October 7, 1949, by and between Local Union 542, 542A and 542B, International Union of Operating Engineers, A.F.L. and General Building Contractors Association, Pennsylvania Excavators Association and Contractors Association of Philadelphia", and in accord with the oral agreement made the effective date May 1, 1950, provided for the creation of the welfare fund and continued all of the terms and conditions of the collective bargaining agreement of October 7, 1949 until April 30, 1952. It was signed by Halloran and Kelly as the "duly authorized" representatives of the plaintiff associations and the defendant Unions. Prior to the execution of the trust agreement, the six trustees provided for therein, three of whom were representatives of the associations and three representatives of the Unions, including Underwood, unanimously passed a resolution adopting the welfare fund "... in accordance with the terms of a Collective Bargaining Agreement negotiated by the parties thereto under date of April 14, 1950."
Kelly, on August 25, 1950, forwarded the addendum to Underwood, stating that he had executed it on behalf of the Union. Underwood, on October 11, 1950, attempted to repudiate Kelly's authority and the terms of the agreement. Halloran, to whom the letter of repudiation was addressed, immediately notified Kelly that the employers insisted that the agreement of the parties be honored.
The welfare fund began operation with Kelly, as paid administrator, assuming extensive responsibilities for the conduct of its affairs. The Fidelity-Philadelphia Trust Company, as fiscal agent, opened its trust account on December 7, 1950.Subsequent to the execution of the trust agreement, the trustees held meetings on October 19 and 27, 1950, and March 26, 1951. More than a quarter of a million dollars has been paid into the welfare fund.
The Unions, on February 21, 1951, sent to plaintiffs letters giving notice of termination of the collective bargaining agreement, and on April 5, 1951 sent letters to the plaintiffs advising that work by employe members of the Union would stop May 1, 1951. Plaintiffs, on April 27, 1951, filed their bill in equity averring the collective bargaining agreement, a threat of a strike in violation of the provisions thereof, irreparable loss and damage which would be suffered as a result of the breach, and inadequacy of a remedy at law.
The appellant Unions contend that (1) the holding of the court below...
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