Pacific Mills v. Textile Workers' Union of America, Local 254

• Decision Date: 04 June 1941
• Docket Number: 15274.
• Parties: PACIFIC MILLS v. TEXTILE WORKERS' UNION OF AMERICA, LOCAL NO. 254 et al.
• Court: South Carolina Supreme Court

15 S.E.2d 134

197 S.C. 330

PACIFIC MILLS v. TEXTILE WORKERS' UNION OF AMERICA, LOCAL NO. 254 et al.

No. 15274.

Supreme Court of South Carolina

June 4, 1941

Malcolm Donald, of Boston, Mass., and Elliott, McLain, Wardlaw &amp Elliott and Nelson, Mullins & Grier, all of Columbia, for appellant.

John W. Crews and Fred Townsend, both of Columbia, for respondent.

BAKER Justice.

The dissenting opinion of Mr. Acting Associate Justice THURMOND gives the history of this litigation, and therefore need not be repeated here .

The "Questions Involved" in this appeal are stated by appellant to be:

"1. Is not a partial assignment enforcible only in equity?

"2. Will equity enforce a partial assignment where the enforcement thereof would impose substantial hardships on a debtor who has not consented to the assignment?

"3. Will the enforcement of the assignments under the facts of this case impose substantial hardships upon the debtor?

"4. Entirely apart from the question of validity of the assignments under the state law, do not the assignments violate the National Labor Relations Act and will not the Company by recognizing them be committing a prohibited unfair labor practice?

"5. If the enforcement of the assignments would compel the Company to violate the National Labor Relations Act, should not a court of equity refuse to decree their enforcement?"

The respondents raise no issue as to appellant's statement of the "Questions Involved," and "left-handedly" concur therein.

This Court has heretofore recognized the right of the assignee of wages due an assignor by an employer to enforce the collection of same against the employer in a court of law where, from the conduct of the employer, the assumption arose that he had agreed to respect the assignment. Bryant v. Askin & Marine Co., 146 S.C. 520, 144 S.E. 231. And in Dunbar v. Johnston et al., 170 S.C. 160, 161, 169 S.E. 846, 847, it was held that an acceptance by the employer is not necessary to give complete effect to the assignment "that wages or salary is a property right which may be assigned; and when such assignment is made and the employer has notice of it, if no legal reason appears why it should not be given force and effect, he will be bound by it, whether he accepts it or not." (Italics added).

In both of the foregoing cases cited the assignments involved were partial assignments, but this issue was not raised, and therefore not passed upon; and the assignments were treated as though they were total assignments. In the first cited case, the employer had recognized the assignment and deducted from the wages of the employee the amounts stipulated in the assignment; and in the second cited case, it is stated in the opinion of the Court: "The employer offered no defense to the action except that it did not deem itself bound to respect the assignment and to pay the assignee, as directed, any portion of the wages of the employee as they accrued."

The opinion in the Dunbar case was written by Mr. Justice Stabler, afterwards Chief Justice, who with his usual far-sightedness, no doubt anticipated that at some time there might come to this Court a case where the issue that a partial assignment was not enforceable at law, would be made; and that such an assignment of wages would be potent only "if no legal reason appears why it should not be given force and effect."

The only contract involved in this case to which appellant is a party, is its contract to pay to its employees a certain compensation or wage for their services and under the law as it has been declared by our Courts, to pay the whole of said compensation or wage to either the employee or to any one assignee thereof, but there is no contract to pay except as a single act. In fact, appellant refused to enter into a contract with respondent Union as the bargaining agent for its employees which embodied the "check-off" system; that is, the deduction from the pay of such employees as were members of respondent Union of the sum of $1 per month, and pay same over to the respondent Union. For a Court to enforce such partial assignment of wages would be tantamount to compelling appellant to enter into a contract, or writing a clause into a contract to which appellant objects. It is the duty of Courts to enforce contracts, but to refrain from making them. Stating the matter from another viewpoint, the enforcement of these partial assignments, and it is conceded by the parties to this action that the wage assignments involved are partial assignments, would be to force appellant to become the agent of such of its employees as are members of respondent Union and have executed a partial assignment of their wages to the Union, and also the agent of the respondent Union to collect from the one and to pay over to the other. The appellant has the legal right to refuse to accept such an agency even if it were offered compensation for the additional work thus devolved upon it. The appellant and the respondent Union, one a private corporation, the other an association of individuals, occupy no different position from that of any other class of citizens in the eyes of the law in South Carolina.

While the Courts of this State recognize a partial assignment of a chose in action as an equitable assignment and will protect the assignee when they can do so without working a hardship upon the debtor, yet the enforcement of such partial assignment can only be had in a Court of Equity. See Carwile, Rec's, v. Metropolitan Life Insurance Company, 136 S.C. 179, 134 S.E. 285.

At the present time there has been filed with appellant approximately 1,100 of these partial assignments. Basing the calculation on 1,100 assignments, it is the finding of the Master, concurred in by the Circuit Judge, that it will require the services of or the additional work of one person an average of six hours per week to collect these dues.

The record discloses that at the time of the taking of testimony in this case, the respondent Union had an additional 300 of these partial assignments, and that it intends also filing these with appellant. And, of course, as the membership of respondent Union increases (appellant has 2,300 employees) additional assignments will be filed with appellant. And, correspondingly the burden and hardship increases.

Furthermore, if appellant can be compelled to recognize these partial assignments, either at law or in equity, then all other partial assignments which may be executed and delivered by appellant's employees would likewise have to be honored; and carried to a logical conclusion, appellant would have to do a banking business insofar as open checking accounts are concerned.

It will therefore be seen that aside from the possibility of making errors in the collection of these dues, for which appellant would be answerable, and the possibility of having to defend actions for wrongfully deducting dues where there is a dispute as to whether an employee has actually executed an assignment, the appellant would suffer financial burden and hardship if it be compelled to recognize these partial assignments, and this we hold as a matter of law, would be a burden and hardship to which a court of equity cannot lend its aid.

The principles underlying the foregoing discussion are too elementary and well settled to justify encumbering this opinion with further citation of authority.

In view of our holding herein, we see no necessity for entering into the legal maze which has been created by the decisions attempting to construe the National Labor Relations Act. We will therefore content ourselves with the statement that in our opinion, to force appellant to recognize these partial assignments would be against the spirit, if not against the letter of said Act. But we rest our conclusions on the considerations hereinbefore expressed.

It is our opinion that the decree appealed from should be reversed; that the assignments mentioned and described in the complaint in this action are void and of no effect insofar as appellant is concerned; that appellant is entitled to permanent injunctive relief against respondents undertaking to enforce same as against appellant in any Court of this State; and that an order of injunction should forthwith issue from this Court in accordance with the views above expressed.

Reversed.

BONHAM, C. J., FISHBURNE, J., and L. D. LIDE, A. A. J., concur.

J. STROM THURMOND, A. A. J., dissents.

J. STROM THURMOND, Acting Associate Justice (dissenting).

This is an action in equity, brought by the Pacific Mills (hereinafter called the Company) against Textile Workers' Union of America, Local Number 254, Columbia, South Carolina (hereinafter called the Union), and its president and vice-president, seeking relief by way of interlocutory and permanent injunction against the enforcement of certain wage assignments, hereinafter more particularly referred to.

The Union was certified by the National Labor Relations Board as the exclusive representative of the production and maintenance employees of the Company at its Columbia plants in February, 1938, and in July of that year, a collective bargaining contract was entered into between the Company and the Union for a period of one year. In the summer of 1939, negotiations looking toward the renewal of the contract or the making of a new contract began, and agreement was reached on many matters; but as a result of disagreement on other matters a strike occurred on August 18, 1939, and continued until October 14, 1939, during which period the plants remained closed and the Company did not operate.

In September, 1939, a board of mediation, appointed by the State Commissioner of Labor, found that there were three principal issues involved in the strike, namely,...