Horn Transfer Lines, Inc. v. Morgan

• Decision Date: 10 December 1965
• Citation: 398 S.W.2d 234
• Parties: HORN TRANSFER LINES, INC., Appellant, v. Buford MORGAN, Appellee.
• Court: United States State Supreme Court — District of Kentucky

Page 234

398 S.W.2d 234

HORN TRANSFER LINES, INC., Appellant, v. Buford MORGAN, Appellee.

Court of Appeals of Kentucky.

Dec. 10, 1965.

Adrian F. O'Bryan, Jerry A. Lloyd, Louisville, for appellant.

Ralph H. Logan, Hardy, Logan & Tross, Louisville, for appellee.

CHESLEY, A. LYCAN, Special Commissioner.

On or about October 1, 1959, James G. Pressel and others formed a trucking company in Louisville known as the Merchants Truck Leasing Corporation. Rudy W. Schauberger was then the owner of an unincorporated trucking business known as the Horn Transfer Lines. Schauberger died in 1959 and his executrix, that year or in 1960, sold the Horn Transfer Lines to the Merchants Truck Leasing Corporation. This sale apparently included all assets and good will of the Horn Transfer Lines except the cash and accounts receivable. The name of the corporation organized by Pressel and others was later changed to the Horn Transfer Lines, Inc., and the latter is the appellant herein.

The Merchants Truck Leasing Corporation was not operating under a labor union contract, although the record indicates some of its drivers were union members. The Horn Transfer Lines, the proprietorship owned by Schauberger, was operating under a labor contract with General Drivers, Warehousemen and Helpers Local Union No. 89, known as the Central States Area Local Cartage Agreement. We shall hereinafter refer to the former as 'the union' and to the latter as 'the contract.'

Appellee, Buford Morgan, began working for the Merchants Truck Leasing Corporation in 1959, and continued his employment with it up to September 1, 1960, and after its name was changed to the Horn Transfer Lines, Inc. Morgan was a union member but there was no checkoff for dues, as he paid his dues direct to the union. He was on the latter date discharged on the ground that he had failed to spread a tarpaulin over a loaded truck, thus permitting the cargo to get wet and causing his employer to pay $350 in damages. The damage to the cargo and the fact that Horn Transfer Lines, Inc., paid the damage is established, but the jury found in favor of Morgan on appellant's counterclaim against him for this and a few other items.

After the purchase of the Horn Transfer Lines by the Merchants Truck Leasing Corporation and its reinstitution as the Horn Transfer Lines, Inc., the latter was approached by agents of the union, and an agreement was signed wherein the Horn Transfer Lines, Inc., agreed to contribute to the health, welfare and pension fund of the union. This fund was set up in and was included as a part of the contract.

Upon appellee's discharge on September 1, 1960, he immediately filed a grievance that he had been unfairly discharged, which was heard pursuant to the contract by a committee composed of three representatives from local cartage companies and three representatives of the union, as provided by Article VII of the contract. The committee made an award dated September 22, 1960, which reads:

'The decision of the committee is that Buford Morgan be put back to work and is to be paid for all time lost since September 2, 1960, and that all pay now due or being withheld from Mr. Morgan by Horn Transfer Company be paid to him on or before the next regular pay day.'

After appellant's refusal to comply with the ruling of the committee, this action to enforce its award was begun in the circuit court. The trial court, under the facts outlined, allowed the jury to find whether or not appellant had accepted the provisions of the union contract and, if they so determined, to award appellee $2.65 per hour for a 40-hour week from September 2, 1960, until March 2, 1962. The jury made a finding that a contract was brought into existence by appellant with the union and returned a verdict that appellee should receive total wages for the time he was out of work, namely, for a period of 78 weeks.

On this appeal it is first asserted there was no evidence of material substance introduced which in any wise established a contract between the Horn Transfer Lines, Inc., and the union.

Section 3 of the contract entered into between the Horn Transfer Lines, the company owned by Schauberger, and the union provides in part:

'This Agreement shall be binding upon the parties hereto, their successors, administrators, executors and assigns. In the event an entire operation or any part thereof is sold, leased, transferred or taken over by sale, transfer, lease, assignment, receivership or bankruptcy proceedings, such operation shall continue to be subject to the terms and conditions of this Agreement for the life thereof. On the sale, transfer or lease of any individual run or runs, only the specific provisions of this contract, excluding supplements or other conditions shall prevail. It is understood by this section that the parties hereto shall not use any leasing device to a third party to evade this contract. The Employer shall give notice of the...