Goldstein v. International Ladies' Garment Workers' Union

• Decision Date: 03 January 1938
• Docket Number: 69,70
• Citation: 196 A. 43,328 Pa. 385
• Parties: Goldstein et al., Appellants, v. International Ladies' Garment Workers' Union et al.; International Ladies' Garment Workers' Union et al. v. Goldstein et al., Appellants
• Court: Pennsylvania Supreme Court

196 A. 43

328 Pa. 385

Goldstein et al., Appellants, v. International Ladies' Garment Workers' Union et al.;

International Ladies' Garment Workers' Union et al. v. Goldstein et al., Appellants

Nos. 69, 70

Supreme Court of Pennsylvania

January 3, 1938

Argued December 8, 1937

Appeals, Nos. 69 and 70, Jan. T., 1938, from order and judgment of C.P. No. 2, Phila. Co., June T., 1937, Nos. 5714 and 6078, in cases of Joseph Goldstein et al., individually and as co-partners, trading as Goldstein & Levin, v International Ladies' Garment Workers' Union et al and International Ladies' Garment Workers' Union et al. v. Joseph Goldstein et al., individually and as co-partners, trading as Goldstein & Levin. Reversed.

Petition by labor union to confirm arbitration award, and petitions by employer to determine the making of the arbitration agreement, and to vacate the award. Before KALODNER, J.

The opinion of the Supreme Court states the facts.

Decree entered dismissing employer's petitions and granting Union's petition to confirm award and to enter judgment thereon. Employer appealed.

Errors assigned, among others, were dismissal of petitions.

Order and judgment of the court below reversed, without prejudice to appellees as to other proceedings under the contract in controversy.

Harry Shapiro, for appellants.

M. Herbert Syme, of Syme, Simons & Ziserman, for appellees.

Before SCHAFFER, MAXEY, DREW, LINN, STERN and BARNES, JJ.

OPINION

MR. JUSTICE STERN:

In the waist and dress industry in Philadelphia collective bargaining agreements have resulted in industrial peace and the maintenance of harmonious relations between employers and employees for several years. The present case does not involve the determination of any substantive rights of the parties to such agreements. As the record is here presented the only question is in regard to the proper procedural method of effecting their enforcement.

Appellees, International Ladies' Garment Workers' Union and the Joint Board of Waist and Dress Makers' Union of Philadelphia, affiliated with the International Ladies' Garment Workers' Union, representing employees in the needlework trade, entered into a written agreement on February 2, 1937, with Philadelphia Waist and Dress Manufacturers' Association, an organization of employers engaged in the manufacture of blouses, waists, dresses and other women's apparel in Philadelphia. In making this contract, the Association acted on behalf of its members. Appellant partnership, Goldstein & Levin, operating a factory in Philadelphia for the manufacture of silk dresses, was, and still is, such a member, and, by the terms of the by-laws of the Association, would be bound by this contract in the absence of any agreement or understanding between themselves and appellees to the contrary. The contract, which aimed to stabilize conditions in the industry and was to be in force for three years, made provision against lockouts and strikes, and contained a covenant that "No member of the Association shall move his factory or factories outside of the City of Philadelphia during the life of this agreement." All complaints, disputes and grievances between the parties involving questions of interpretation or application of any clause of the agreement, or relation between the parties and their respective members, were, if the representatives of the Union and the Association failed to agree, to be submitted to an impartial chairman named in the agreement, and his decision was to be binding.

It is the contention of appellees that on or about July 4, 1937, Goldstein & Levin moved their factory from Philadelphia to Johnstown and began manufacturing there the same kind of dresses they had been making at their Philadelphia plant. If appellants were parties to the contract in question, and if they violated it, appellees undoubtedly could have compelled a common-law arbitration under the terms of the agreement, and, if the award made called for injunctive relief, could have enforced it by appropriate proceedings in equity. "The law is definitely settled that where parties to an executory contract agree that all disputes, arising in relation thereto, shall be first submitted to the arbitrament of one or more named persons, they are bound by the terms of submission . . .": Gowen v. Pierson, 166 Pa. 258, 264; Bashford v. West Miami Land Co., 295 Pa. 560, 568. Instead of proceeding on the basis of common-law arbitration, however, appellees invoked the Pennsylvania Arbitration Act of April 25, 1927, P.L. 381, which unfortunately, as will hereinafter be pointed out, is not broad enough in its scope, and apparently was not designed, to cover arbitration proceedings where the remedy sought and awarded is a mandatory decree. Moreover, even had the act been available, one of its most important provisions was disregarded in these proceedings.

Appellees presented their complaint to the impartial chairman, who found that Goldstein & Levin had moved their factory from Philadelphia, as charged by appellees, and made an award directing them (a) to reinstall within one week thereafter the machinery removed from their Philadelphia plant; (b) to reemploy the workers formerly employed at the Philadelphia plant; and (c) to continue to be bound by the agreement between the Union and the Association for the duration thereof. Appellees then filed a petition in the court below, under the Act of 1927, for confirmation of this award. Appellants, on the other hand, filed a petition alleging that they were not parties to the contract between the Union and the Association, but had entered into a special written agreement of their own with the Union on September 4, 1936, which did not provide for any general arbitration by the impartial chairman, and had expired by its terms on June 30, 1937; that it was understood and agreed between them and the Union when the February agreement was made that it was not to apply to them; that they had not in fact moved their factory from Philadelphia to Johnstown but had operated the plant at Johnstown for the manufacture of cotton dresses since October, 1936, this plant being conducted under an agreement made with the Union on April 10, 1937; that their business in Philadelphia had been extremely unprofitable and they had discontinued it entirely. They petitioned that the award of the arbitrator be vacated.

Hearings upon the petitions to confirm the award and to vacate it were conducted by the court, but, finding that the testimony before the arbitrator had not been given under oath, as required by the Act of 1927, the court referred the case back to the arbitrator for a hearing de novo. Accordingly the arbitrator held another hearing, at which Goldstein & Levin appeared specially by counsel to object to the arbitrator's jurisdiction, and requested him to refer to the court for determination the factual issue as to whether they were bound by the contract of February 2, 1937, between the Union and the Association. The arbitrator refused to do this. He made a finding that Goldstein & Levin were parties to that contract, and therefore subject to his authority; on the merits of the case he confirmed his previous award. Appellees again filed a petition praying confirmation of this award, while appellants filed a petition requesting the court to hear and determine preliminarily the issue as to the February agreement. The court held a hearing on these two petitions, together with the former petition of appellants to vacate the award, and handed down an opinion holding that the court was concluded by all the findings of the arbitrator, both that Goldstein & Levin had moved their plant from Philadelphia to Johnstown and that they were bound by the February contract containing the arbitration provision. As to the question of the removal of the factory, the ruling of the court was clearly right. An arbitrator, in the absence of any agreement limiting his authority, is the final judge of both law and fact, and his award will not be reviewed or set aside for mistake in either; otherwise arbitration proceedings, instead of facilitating the settlement of controversies, would serve but to delay the final determination of the rights of the parties: Pierce Steel Pile Corporation v. Flannery, 319 Pa. 332, 339. But as to the question whether appellants were parties to the February agreement, the ruling of the court was just as clearly wrong. The court struck out all the testimony in regard thereto, and in its opinion said: "The question involved [as to the contract] was one of fact, and the decision of the Arbitrator thereof cannot be reviewed by us. . . . We have no power to reverse the findings of the Arbitrator on questions of fact except for actual fraud, deception or a mistake which is not merely one of judgment. . . . It is clear that this Employer's case rests upon the single...