Lehigh Structural Steel Co. v. Atl. Smelting & Ref. Works

• Decision Date: 26 August 1920
• Docket Number: No. 48-22.,48-22.
• Citation: 111 A. 376
• Parties: LEHIGH STRUCTURAL STEEL CO. et al. v. ATLANTIC SMELTING & REFINING WORKS et al.
• Court: New Jersey Court of Chancery

111 A. 376

LEHIGH STRUCTURAL STEEL CO. et al.

v. ATLANTIC SMELTING & REFINING WORKS et al.

No. 48-22.

Court of Chancery of New Jersey.

Aug. 26, 1920.

Suit by the Lehigh Structural Steel Company and another against the Atlantic Smelting & Kefining Company and others. injunction granted.

Merritt Lane, of Newark, for complainants.

William Harris and Jacob Siff, both of Newark, for defendant Atlantic Smelting & Kefining Works.

John A. Matthews, of Newark, for defendants Tierney and Local No. 11, International Brotherhood of Bridge & Iron Workers of America.

BACKES, V. C. This bill is to restrain a conspiracy to prevent the performance of a building contract, by means of a strike to compel a closed shop.

The Lehigh Structural Steel Company contracted to fabricate and deliver to the Atlantic Smelting & Refining Works, f. o. b. Allentown, Pa., the structural steel for a building at Brills, Newark, and also to erect it. The Lehigh Company sublet the erection to Donnell-Zane Company. The steel had been delivered and paid for, and Donnell-Zane had nearly completed the work when its employes, erectors, struck by order of Timothy Tierney, the business agent of Local No. 11, International Brotherhood of Bridge & Iron Workers of America, of which local, of Newark, they were members. Donnell-Zane then declared its intention of employing other available labor which, of course, was nonunion, and was notified by William E. Lehman, the architect of the building, and the sole representative and major domo of the Atlantic Company, that it would not be permitted to finish the job with other than union workmen, his stated reason being that there would be a general strike of the allied trades on the works if it were done otherwise. That that would have followed is common experience, and was admitted by Tierney; and that the strike was called, and the general strike would have been brought into play to force the Atlantic Company to breach its contract with the Lehigh Company if Donnell-Zane persisted in defying organized labor, as hereinafter related, is manifest, and is not controverted. Lehman offered to mediate, but Donnell-Zane, knowing that a settlement meant a compliance with the demands of the unions and a complete surrender to them, would have none of it, and went ahead with nonunion labor until stopped by an order of this court on a bill filed by the Atlantic Company, alleging that it had been agreed that the work was to be done by union men only. Upon the return of the order to show cause, the restraint was dissolved, and the bill dismissed on the ground that the allegation was not sustained by the proofs, and because an agreement to restrict the labor to union men, in the circumstances, would not be enforceable, as being in restraint of trade and against public policy. An effort was then made to settle the matter on a money basis, but, this coining to naught, Lehman, for the Atlantic Company, served the following notice:

"To the Lehigh Structural Steel Company. Gentlemen: You are hereby notified to cease any further work under contract made between the undersigned and the Lehigh Structural Steel Co. for the erection of all structural steel for the refining plant being built for the undersigned on Doremus avenue, Newark, New Jersey. This notice is given to you because you insist upon using nonunion labor to complete the said work. The contract herein referred to is the one referred to as 'our contract No. 723' in your letter of November 15, 1919, addressed to the undersigned, wherein you agree to do said work for the sum of $2,970.00. Atlantic Smelting & Refining Works. Inc., by Morris Birenbaum, Treas."

The complainants thereupon filed this bill, reciting the foregoing facts, and further setting up that the strike was ordered to force them, against their will, to conduct their business on the closed shop plan, viz., to employ none but union men. Tierney and Local No. 11 admit and avow this to be their object, and plead in justification that the Building Trades Employers' Association of the City of New York (an association of nearly all the building contractors of New York), of which the Iron League is a member, and of which league the complainants are members, entered into a contract with the New York Building Trades Council of Greater New York and Long Island (an association of all the trades unions of those localities) on November 20th last, to become effective January 1, 1920, and to continue for one year, whereby the Employers' Association bound its members to employ only union men in their various building enterprises in Greater New York and Long Island, and certain named additional territory; that the complainants refused to submit to this, and in a given instance, on a building in Forty-Fourth street, New York, Donnell-Zane used nonunion labor, for which violation the building is now under strike; that the present strike was ordered by Robert P. Brindell, president of the Building Trades Council, and put into execution by Tierney, of Local No. 11, for the purpose of compelling DonnellZane to comply with the contract. The complainants admit the making of the contract and their refusal to abide its terms, because, as they claim, it was ultra vires the Employers' Association to bind the Iron League and its members, restricting them in the selection of their workmen to members of organized labor, because it was in contravention of public policy, and therefore unlawful. At the trial the complainants attempted to show, further, that the contract of the Employers' Association with the Building Trades Council was not binding upon the individual members of the Iron League until they gave bonds, which they had not done. The conclusion I have reached, presently to be stated, makes it unnecessary to pass upon that issue.

The strike is purely sympathetic. Tierney and the men who obeyed his order had no grievance. He supplied them to Donnell-Zone, and wages, hours, and conditions, were satisfactory and according to the union regulations. Local No. 11 was not a party to the New York contract, nor a beneficiary, except in the sense that all locals are benefited by the achievements of the various units of the federation. The men were not under contract, and individually had the right to quit work as it pleased them, and as members of the federation it was their privilege to use the strike in sympathy with the endeavors of their New York brethren, and to advance the common cause of organized labor, provided the motive—that is, the object sought to be attained—was not an unlawful one. But the privilege to strike is not license to strike. Those availing themselves of the privilege must respond in damages for the injury inflicted, unless they can show just cause or excuse. The burden is on them. The lawfulness of the motive for the sympathetic strike must, then, be sought in the New York situation. Tierney and Local No. 11, in their answer, defend the closed shop in New York on the ground that the contract between the Employers' Association and the Building Trades Council was "a legitimate, legal, honest contract, entered into in due and legal manner, for the economic betterment of labor union members and for the more constant and thorough understanding between capital in this line of business." These generalities are meaningless. If it is meant that the contract was to secure to the unions a legitimate benefit and advantage in the field of labor, the proofs are painfully absent. I have looked into the contract and find nothing to explain the provisions therein for the closed shop except this dubious foreword:

"In order to secure continuity of employment and uninterrupted production it is hereby agreed between the Building Trades Employers' Association of the City of New York and the Building Trades Council of the state of New York representing and having authority to act for."

Then follows the names of 33 locals of the various trades unions in the building line in New York and Long Island over which the Building Trades Council has jurisdiction, the hours of work per week, a scale of wages, and the closed shop clause. It concludes with a paragraph that the agreement applied to all work performed within the geographical limits of Greater New York and Long Island, and in such additional territory as is included in the provisions of the existing trade agreements between the several trade associations of employers and the unions of their trades. The closed shop clause is negative in phraseology, but when read in the light of the laws of the union, its dominating character is revealed. The caption, "To Secure Continuity of Employment and Uninterrupted Production," as explained by counsel for the union, means simply this: Before the contract was made the various locals in the Metropolitan District struck for one reason or another ad lib., thus involving the other trades, sympathetically or of necessity, and putting them out of work. To overcome this evil and disastrous consequence to the members of the unions, the organization concluded to minimize their loss of time and wage by synchronizing their strikes. This was a perfectly proper self-serving purpose, but I fail to see how the closed shop provision of the contract, which, in effect, precluded nonunion men from securing work in their crafts in Greater New York and Long Island, serves to promote that object. "The continuity of employment" could as readily have been accomplished by. binding the parties to a performance for the time stipulated. The closed shop feature obviously bears no relation whatever to the other and legitimate purposes of the contract, and it is plain that the primary and ultimate thing organized labor sought was the monopolization of labor in all lines of the building trade within the territory to which the contract applies. As to this there is no question, for the counsel of the union frankly admits the indictment, and asserts that the movement to...