International Woodworkers v. McCloud River Lbr. Co., 6398.

• Decision Date: 29 April 1953
• Docket Number: No. 6398.,6398.
• Citation: 119 F. Supp. 475
• Parties: INTERNATIONAL WOODWORKERS OF AMERICA, LOCAL 6-64, CIO v. McCLOUD RIVER LUMBER CO. et al.
• Court: U.S. District Court — Northern District of California

119 F. Supp. 475

INTERNATIONAL WOODWORKERS OF AMERICA, LOCAL 6-64, CIO v. McCLOUD RIVER LUMBER CO. et al.

No. 6398.

United States District Court, N. D. California, N. D.

April 29, 1953.

Jay A. Darwin, San Francisco, Cal., for plaintiff.

Littler, Coakley & Lauritzen, San Francisco, Cal. for defendant.

Clifford R. Lewis and Kenneth McGilvray, Sacramento, for intervenor.

LEMMON, District Judge.

Whether the parties meant what they said when they called the augmentation in pay a "wage increase", to be used by the consenting employees in furtherance of a Health and Welfare Plan —

Whether the instrument at bar should be reformed so as to delete the provision that each employee must specifically agree in writing before this "wage increase" can be thus applied as to him —

These are the two crucial questions here presented to the Court for solution.

Implicit in those two problems are some others:

To what extent should the Court disregard the plain language of the parties, who have been dealing at arms' length without proof of any overreaching on either side?

If the plain words in the document before this Court do not mean what the parties intended them to mean, Talleyrand was indeed correct in his cynical aphorism that language is designed to conceal thought!

Can the employee-authorization provision in the agreement be cut without causing the entire instrument to bleed?

Is this a case where the reformation of an agreement is merely a refuge for the improvident?

1. The Stipulation.

The record in this case consists of a Court-approved Pre-Trial Stipulation with exhibits attached and of testimony adduced at the trial. The testimony will be referred to hereinafter.

The pertinent facts contained in the stipulation may be summarized as follows:

The main action and the defendant's counterclaim are brought pursuant to the Federal Declaratory Judgments Act, 28 U.S.C. §§ 2201-2202, pursuant to Section 301 of the Labor Management Relations Act of 1947, 29 U.S.C.A. § 185, and by reason of the Federal statutes conferring jurisdiction upon this Court on the basis of diversity of citizenship. The intervener has been permitted to intervene by order of the Court dated July 18, 1951.

The plaintiff is a labor organization within the meaning of Section 2(5) of the National Labor Relations Act, as amended, 29 U.S.C.A. § 152, and at all times herein mentioned has been the collective bargaining representative for employees of the defendant covered by the collective bargaining agreements, infra.

The defendant is a corporation organized under the laws of Minnesota, and at all times herein mentioned has been doing business and operating as a foreign corporation in Siskiyou County, California. The defendant is engaged in the logging and lumber industry and is engaged in "commerce" within the provisions of Section 2(6) of the National Labor Relations Act, as amended.

On or about May 21, 1948, the plaintiff and the defendant entered into a collective bargaining agreement covering production and maintenance employees, with certain exclusions, in the defendant's plant at McCloud, California. On or about May 29, 1948, the plaintiff and the defendant entered into a collective bargaining agreement covering production and maintenance employees, with certain exclusions, in the defendant's logging operation. On or about August 21, 1948, the same parties entered into a like agreement covering certain employees in the defendant's town operations at McCloud.

By the above agreements, the defendant at all times recognized the plaintiff as the exclusive bargaining agent for the employees covered thereby, for the purpose of collective bargaining as to rates of pay, hours of employment, or other working conditions, within the means of Section 9(a) of the National Labor Relations Act, as amended.

On or about January 25, 1950, the defendant received written demands from the plaintiff concerning proposals for revision and amendment of the agreements referred to above. These proposals involved the establishment of a Health and Welfare Plan and certain paid holidays.

For a number of years prior to 1950, it had been the custom of the plaintiff to appoint the Northwest Regional Negotiating Committee of the International Woodworkers of America, CIO, hereinafter referred to as the Northwest Committee, to represent it in collective bargaining. Likewise, it had been the custom of the defendant to appoint Pine Industrial Relations Committee, Inc., hereinafter referred to as "PIRC", to represent it in collective bargaining negotiations, which, however, have never been binding upon either of the two principal parties herein. Such negotiations ordinarily result in joint recommendations, which the said parties may accept, reject, or modify.

The matters set forth in the following thirteen numbered paragraphs, are not within the direct knowledge of the defendant, but it admits that if the plaintiff had produced witnesses at the trial they would have testified substantially to the matters therein alleged:

1. In the Pacific Northwest, there are more than 100 local unions chartered by the International Woodworkers of America, hereinafter referred to as "IWA-CIO", which represent employees in the lumber industry and which have collective bargaining agreements, covering approximately 40,000 employees, with employers engaged in that industry. These agreements are generally subject to renewal, termination or modification on April 1 of each year, on 60 days' notice prior to that date by either party. It has been the practice for these local unions to delegate to the Northwest Committee authority to represent them in negotiations for modifications that they desire to have applied uniformly throughout the area affected. The program of negotiations followed by the Committee is formulated by a "broad conference" of delegates elected by the local unions. Each spring, the Northwest Committee has negotiated with various employers' associations, and also with various independent employers that are not represented by any such association. The largest of the employer associations is the Lumberman's Industrial Relations Committee, hereinafter referred to as "LIRC", and the second largest is the Willamette Valley Lumber Operators Association (WVLOA), PIRC, of which defendant is a member, represents employers in Southern Oregon and Northern California. The settlements reached each year have been subject to approval by the local unions represented by the Northwest Committee and by the members of the various employers' associations. The union approval has been secured by the taking of a referendum vote among all of the employees who are members of the local unions as one group, and the result has been generally accepted with very few exceptions by the local union affected.

2. Prior to January 25, 1950, there was held a broad conference of union delegates from the various locals in the Northwest, at which it was decided by a majority vote to seek to amend the collective bargaining agreements between locals and district councils of the IWA-CIO and employers in the Pacific Northwest, to include provisions for a Health and Welfare Insurance Program paid for by the employers, and certain paid holidays. It was also decided not to seek an increase in wages. In accordance with this decision, substantially identical notices were given to the employers, including the defendant, by the local unions or their District Councils acting for them, of their intention so to revise the said agreements. At the same time, the employers were notified that the local unions had delegated to the Northwest Committee authority to negotiate for them on these requested modifications. Thereafter, beginning on February 20, 1950, to approximately April 1, 1950, one or more meetings were had with each of the various employer associations and the said independent employers. During this period, the principal negotiations were held with LIRC, WVLOA, and PIRC.

3. During these meetings, the employers and employer associations other than PIRC took the position that, as a matter of principle, the employers should not undertake to pay for and administer or help administer the union's health and welfare program and, for the most part, gave the Northwest Committee a flat "No" answer to the union demands. The employers submitted no counter-proposal and there was little discussion with respect to the details of the program requested or the insurance coverage to be provided. PIRC's position at this stage of the negotiations was expressed in a letter dated March 16, 1950, a copy of which is attached to the Stipulations.

(It might be observed at this juncture that, although the Stipulation does not point out any passage in PIRC's five-page single-spaced typewritten letter just referred to, an examination of the document by the Court discloses the following pertinent sentences:

"The costs involved in providing the health and welfare program demanded by your union are direct wage costs; just as much so as if they were wages going to the employees on their pay checks * * *.

* * * * * * "It is our belief that our contracts should be extended, without change as to wage cost items." (Emphasis supplied.)

It is significant that, even at this early stage of the negotiations, the employers regarded the union-proposed Health and Welfare Plan as essentially a "wage increase" project, and communicated that view to the employees. This was before any controversy had arisen as to the nature of the proposed outlay demanded of the employers.

4. Continuing, the Stipulation sets forth that at the initial meetings held with LIRC and WVLOA, the coverage that the union was proposing was explained and the approximate cost of it given to the employers as $12.41 per month or 7½¢ to 8½¢ per hour.

5. On or about March 1, 1950, the Northwest Committee had notified the Federal Mediation and Conciliation Service, hereinafter referred to as FMCS,...