International Union, United Auto. Aerospace and Agr. Implement Workers of America, U.A.W. v. International Tel. & Tel. Corp., Thermotech Div.

• Decision Date: 16 October 1974
• Docket Number: No. 74-1316,74-1316
• Parties: 88 L.R.R.M. (BNA) 2213, 75 Lab.Cas. P 10,571 INTERNATIONAL UNION, UNITED AUTOMOBILE, AEROSPACE AND AGRICULTURAL IMPLEMENT WORKERS OF AMERICA, U.A.W., and its Local #125, Appellees, v. INTERNATIONAL TELEPHONE AND TELEGRAPH CORPORATION, THERMOTECH DIVISION, a Delaware Corporation, and Rainbow Plastics Products, Inc., a Minnesota Corporation, Appellants.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 1309

508 F.2d 1309

88 L.R.R.M. (BNA) 2213, 75 Lab.Cas. P 10,571

INTERNATIONAL UNION, UNITED AUTOMOBILE, AEROSPACE AND AGRICULTURAL IMPLEMENT WORKERS OF AMERICA, U.A.W. and its Local #125, Appellees, v. INTERNATIONAL TELEPHONE AND TELEGRAPH CORPORATION THERMOTECH DIVISION, a Delaware Corporation, and Rainbow Plastics Products, Inc., a Minnesota Corporation, Appellants.

No. 74-1316.

United States Court of Appeals, Eighth Circuit.

Submitted Oct. 16, 1974.

Decided Jan, 8, 1975.

John C. Zwakman, Minneapolis, Minn., for appellants.

Robert J. Tennessen, Minneapolis, Minn., for appellees.

Before HEANEY, BRIGHT and ROSS, Circuit Judges.

BRIGHT, Circuit Judge.

The United Auto Workers (Union) ¹ initiated this action against International Telephone and Telegraph Corporation (ITT or Company) ² to compel arbitration of certain grievances between Union-represented employees and the Company.

The Company, claiming that no valid collective bargaining agreement now exists between the two parties, argues that it need not arbitrate the employees' We examine the factual background. In 1969, the National Labor Relations Board certified the United Auto Workers as the bargaining representative for production and maintenance workers of Rainbow Plastic Products, Inc. (Rainbow), located at Golden Valley, Minnesota. At the time of certification, Rainbow was a wholly-owned subsidiary of Thermotech Industries, Inc. (Thermotech). Thermotech owned another subsidiary, Cosum Corporation (Cosum), also located at Golden Valley, Minnesota. In 1970, ITT acquired Thermotech, including its subsidiaries, and these corporations became ITT's Thermotech Division. The Thermotech subsidiaries in part engaged in the manufacture of plastic products. The Union, although representing Rainbow employees, had not represented the employees at Cosum.

grievances. The district court rejected the Company's contentions and ordered the entire matter to arbitration, including the threshold issue of the existence of the bargaining agreement. ³ The Comapny appeals from this ruling.

The Union and Rainbow entered into a collective bargaining agreement on November 20, 1972, expiring two years later on November 18, 1974. That agreement described the employer as Rainbow Plastic Products, Inc., of Golden Valley, Minnesota. During negotiations for the 1972 agreement, the Company advised the Union that it contemplated closing both the Rainbow and Cosum facilities and transferring their functions to a new plant in Lakeville, Minnesota, some 40 miles away. These plans reached fruition during the following year and the Rainbow and Cosum plants were closed in November 1973, and their operations transferred and consolidated in a new facility at Lakeville.

Prior to this shutdown, the Union and the Company had entered into a separate letter agreement, dated January 15, 1973, which stipulated that present Rainbow employees who desired employment at the new facility would receive 'preferential hiring' privileges and, if hired, would be entitled to seniority based on their initial employment with Rainbow. For employees not retained, the Company agreed to grant severance pay benefits. Approximately 40 Union-represented Rainbow employees transferred to the new plant, although 13 voluntarily terminated their employment by December 1, 1973. Thus, at the time of the hearing in the district court, 27 of the 110 workers employed at the Lakeville facility were former Rainbow workers.

Soon after the Lakeville facility opened the Union, prusuant to the 1972-1974 bargaining agreement, filed grievances dealing primarily with wages and seniority rights on behalf of several of the 27 former Rainbow workers. Although the bargaining agreement between the Union and Rainbow cantained a specific procedure to resolve grievances, including arbitration, ⁴ the Company On this appeal, the Company presents two main contentions. First, it contends that the January 15, 1973, letter, referred to earlier, clearly and unambiguously served to terminate the then-existing collective bargaining agreement; and that even if the district court found the bargaining agreement and the January 15 letter to be unclear on the termination issue, the court erred in deferring the issue of contract termination to the arbitrator. Second, the Company contends that the trial court erred in determining that the bargaining agreement was not specifically limited in application by its geographic terms to the plant at Golden Valley, Minnesota.

rejected these grievances and refused arbitration. The Union then brought the present action.

I.

We examine the contract termination issue and the dispute between the parties centering on the January 15, 1973, letter from the Company to the Union. The letter, directed by the Company to the Union's principal negotiator, Francis Jeffrey, was signed on behalf of the Company by Eugene M. Booker, President of Thermotech, and by Jeffrey on behalf of the Union. The text reads as follows:

The district court decision recognized that a duty to arbitrate between the Company and the Union would not survive a clear and unambiguous termination of the underlying collective bargaining agreement. But the district court found that the intent of the parties was ambiguous on termination and held the question of termination to be for the arbitrator.

In its argument, the Company focuses on the concluding paragraph of the January 15 letter in arguing that the parties expressed an intent to terminate or rescind the bargaining agreement. We agree with the district court that the letter agreement is not so unequivocal as to call for a ruling that as a matter of law the parties intended a termination of all rights under the collective bargaining agreement. We confine our discussion to whether the arbitrator or the district court should be called upon to construe the agreements.

On the question of who should determine the issue of contract termination, the district court said:

In view of the well recognized virtues of arbitration and the unclarity surrounding the purported termination of the instant bargaining agreement, the Court cannot say with assurance The district court cited no case directly supporting this holding. ⁵

that the contract has been terminated as a matter of Federal labor law. Rather, this is a determination best left to the arbiter. * * * Having this decision be made by the arbiter is in furtherance of Federal labor policy favorable to submitting doubtful questions to arbitration.

The governing principles of law on arbitration are well established. National labor policies favor arbitration as a means of settling labor-management disputes and all doubts should be resolved in favor of arbitrability. United Steelworkers of America v. Enterprise Wheel & Car Corp., 363 U.S. 593, 80 S.Ct. 1358, 4 L.Ed.2d 1424 (1960); United Steelworkers of America v. Warrior & Gulf Nav. Co., 363 U.S. 574, 80 S.Ct. 1347, 4 L.Ed.2d 1409 (1960); United Steelworkers of America v. American Mfg. Co., 363 U.S. 564, 80 S.Ct. 1343, 4 L.Ed.2d 1403 (1960). But since arbitration is a matter of contract, a party cannot be required to submit to arbitration any dispute that he has not agreed to have arbitrated. Gateway Coal Co. v. United Mine Workers of America, 414 U.S. 368, 374, 94 S.Ct. 629, 38 L.Ed.2d 583 (1974); United Steelworkers of America v. Warrior & Gulf Nav. Co., supra, 363 U.S. at 582, 80 S.Ct. 1347.

It is also clear that whether an employer is bound to arbitrate is normally a threshold matter to be determined by a court on the basis of the contract entered into by the parties. Operating Engineers Local 150 v. Flair Builders, Inc., 406 U.S. 487, 491-492, 92 S.Ct. 1710, 32 L.Ed.2d 248 (1972); John Wiley & Sons v. Livingston, 376 U.S. 543, 546-547, 84 S.Ct. 909, 11 L.Ed.2d 898 (1964); Atkinson v. Sinclair Refining Co., 370 U.S. 238, 241, 82 S.Ct. 1318, 8 L.Ed.2d 462 (1962). The district court found, however, that the issues of contract expiration or termination should be judicially resolved only in those cases 'characterized by indisputable evidence' of expiration or termination; and where there is ambiguous language relating to an alleged termination, the threshold issue of contract expiration or termination should be submitted to arbitration. We disagree.

When a claim has been made that the collective bargaining agreement, which contains an arbitration clause, has terminated or expired, the courts of appeals have generally held these claims to be for judicial resolution regardless of whether the language in question can be characterized as ambiguous or unambiguous.

For example, in the following cases, the facts indicate a genuine ambiguity in the language involved, yet the courts in each case ruled that the issue of contract expiration or termination should be resolved judicially. Oil, Chemical & Atomic Workers Local 7-210 v. American Maize Products Co., 492 F.2d 409 (7th Cir.), cert. denied, 417 U.S. 969, 94 S.Ct. 3173, 41 L.Ed.2d 1140 (1974); International Ladies' Garment Workers' Union v. Ashland Industries, 488 F.2d 641 (5th Cir. 1974); United Auto Workers Local No. 998 v. B. & T. Metals Co., 315 F.2d 432 (6th Cir. 1963); United Mine Workers of America, District 22 v. Roncco, 314 F.2d 186 (10th Cir. 1963); Proctor & Gamble Independent Union v. Proctor & Gamble Mfg. Co., 312 F.2d 181 (2d Cir. 1962). The language under consideration in two other cases has been characterized as relatively unambiguous and there the courts have also ordered judicial resolution of the issue of contract expiration or termination. Teamsters Local No. 249 v. Kroger Co., 411 F.2d 1191 (3d Cir. 1969); M.K.& O. Transit Lines, Inc. v. Association of Street, Electric Railway An exception to this general rule does exist, however, where the parties have agreed to arbitrate issues of contract termination or expiration. For example, in Electrical Workers Local No. 4 v. Radio Thirteen-Eighty, Inc., 469 F.2d 610 (8th Cir. 1972),...