Posadas de Puerto Rico Associates, Inc. v. Asociacion de Empleados de Casino de Puerto Rico, 88-1949

• Decision Date: 01 May 1989
• Docket Number: No. 88-1949,88-1949
• Citation: 873 F.2d 479
• Parties: 131 L.R.R.M. (BNA) 2223, 57 USLW 2668, 111 Lab.Cas. P 11,111 POSADAS de PUERTO RICO ASSOCIATES, INC., d/b/a Condado Plaza Hotel & Casino, Plaintiff, Appellant, v. ASOCIACION de EMPLEADOS de CASINO de PUERTO RICO, Defendant, Appellee.
• Court: U.S. Court of Appeals — First Circuit

Page 479

873 F.2d 479

131 L.R.R.M. (BNA) 2223, 57 USLW 2668,

111 Lab.Cas. P 11,111

POSADAS de PUERTO RICO ASSOCIATES, INC., d/b/a Condado Plaza Hotel & Casino, Plaintiff, Appellant, v. ASOCIACION de EMPLEADOS de CASINO de PUERTO RICO, Defendant, Appellee.

No. 88-1949.

United States Court of Appeals First Circuit.

May 1, 1989.

Maria Milagros Soto, Condado, P.R., for plaintiff, appellant.

Jose E. Carreras Rovira, Rio Piedras, P.R., for defendant, appellee.

Before BREYER, TORRUELLA and SELYA, Circuit Judges.

SELYA, Circuit Judge.

This dispute arises out of a collective bargaining agreement (Agreement) between the corporation which operates the Condado Plaza Hotel & Casino (CPHC) and a labor union which represents certain of CPHC's staff. On May 12, 1987, an arbitrator ruled that CPHC had laid off two union members in violation of the Agreement's seniority provisions. Alleging that the decision exceeded the arbitrator's authority, CPHC brought suit in federal district court pursuant to section 301 of the Labor Management Relations Act (LMRA), 29 U.S.C. Sec. 185, asking that the arbitral award be set aside. Its complaint was docketed on June 12, 1987 (31 days after the award was issued). The district court dismissed the action as time-barred. Posadas de Puerto Rico Associates, Inc. v. Asociacion de Empleados de Casino de Puerto Rico, 689 F.Supp. 44, 47 (D.P.R.1988) (Posadas II ). Plaintiff appeals.

I

Section 301 extends federal jurisdiction to "[s]uits for violation of contracts between an employer and a labor organization," 29 U.S.C. Sec. 185(a), but establishes no time limits. Courts are therefore required to " 'borrow' the most suitable statute or other rule of timeliness from some other source." DelCostello v. International Brotherhood of Teamsters, 462 U.S. 151, 158, 103 S.Ct. 2281, 2287, 76 L.Ed.2d 476 (1983). In Reed v. United Transportation Union, --- U.S. ----, 109 S.Ct. 621, 625, 102 L.Ed.2d 665 (1989), the Supreme Court recently demonstrated how to choose a limitation period when the operative federal statute is silent. The framework limned by the Reed Court comports with that erected by this circuit in Communications Workers of America v. Western Electric Co., 860 F.2d 1137, 1139 (1st Cir.1988). We rehearse the architecture of the selection process.

When Congress fails to furnish an express statute of limitations in connection with enforcement of a federal right, a court's initial look must be to state law to isolate the most closely analogous rule of timeliness. Reed, 109 S.Ct. at 625; DelCostello, 462 U.S. at 158, 103 S.Ct. at 2287; Communications Workers, 860 F.2d at 1139. But, as we have cautioned, "the glance in the direction of the state-law cupboard should not be an automatic or reflexive one." Communications Workers, 860 F.2d at 1139. State limitation periods may on occasion be "unsatisfactory vehicles for the enforcement of federal law," DelCostello, 462 U.S. at 161, 103 S.Ct. at 2289, and can frustrate or interfere with the implementation of federal policies. Reed, 109 S.Ct. at 625. When such dangers loom, a limitation period borrowed from elsewhere in federal law may be applied if "two preconditions are met: (1) some federal rule of limitations 'provides a closer analogy' than state alternatives, and (2) 'the federal policies at stake and the practicalities of litigation' render the federal rule more suitable." Communications Workers, 860 F.2d at 1139 (quoting DelCostello, 462 U.S. at 172, 103 S.Ct. at 2294-95). Before we switch from a state-law to a federal-law focus, however, the borrowed federal rule must seem, all things considered, "significantly more appropriate." Reed, 109 S.Ct. at 625; DelCostello, 462 U.S. at 172, 103 S.Ct. at 2294-95; Communications Workers, 860 F.2d at 1139.

II

Although we have wrestled before with the generic problem, this case presents a new wrinkle. We have yet to pass upon the suitability of different temporal standards vis-a-vis actions to vacate arbitral awards. Nonetheless, we have confronted the problem in two areas which border upon the present one.

In Communications Workers, we applied the 6-month limitation period from section 10(b) of the National Labor Relations Act (NLRA), 29 U.S.C. Sec. 160(b), to a union's efforts to compel management to arbitrate. We resisted the union's suggestion to borrow the state's 6-year statute of limitations for contract actions. Our choice was informed by a desire to preserve "the relatively rapid final resolution of labor disputes favored by federal law," Communications Workers, 860 F.2d at 1141-42 (quoting DelCostello, 462 U.S. at 168, 103 S.Ct. at 2292), which led us to conclude that the arbitral process should not be "suspended in limbo for long periods." Id. at 1142 (quoting United Parcel Service, Inc. v. Mitchell, 451 U.S. 56, 64, 101 S.Ct. 1559, 1564-65, 67 L.Ed.2d 732 (1981)). Six years, we decided, was "simply too long to allow industrial disputes to fester." Id. (quoting Associated Brick Mason Contractors v. Harrington, 820 F.2d 31, 37 (2d Cir.1987)). As we stated:

The objectives of federal labor policy require not only that arbitration be invoked when and as contracted for--but that it be invoked swiftly as well.

Communications Workers, 860 F.2d at 1141.

In Derwin v. General Dynamics Corp., 719 F.2d 484 (1st Cir.1983), plaintiff sought to confirm an arbitrator's award issued three years earlier. Id. at 486. Since Massachusetts set a strict 30-day deadline on challenges to arbitration outcomes, we reasoned that delay in seeking judicial confirmation could not "threaten the finality of arbitral awards." Id. at 489-90. We thus felt free to borrow a state limitation period exceeding three years, ¹ and permitted the action to proceed. Id. at 490.

Although the bottom line was different in these two cases--we borrowed from a federal source in Communications Workers and from state law in Derwin--our basic approach did not vary. In each instance, we examined the nature of the action, the best and closest analogy which state law could furnish, and the contents of the federal-law cupboard. Then, viewing the results of that canvass in light of the underlying policies of federal labor law and the realities of the adversary process, we asked which alternative best promoted industrial harmony and the integrity of labor-management relations.

III

Following this protocol, we begin by isolating the Commonwealth's most nearly analogous rule of timeliness. The district judge determined that local law established a 30-day limitation period on suits to vacate arbitral awards. See Posadas II, 689 F.Supp. at 45; see also Posadas de Puerto Rico Associates v. Asociacion de Empleados de Casino de Puerto Rico, 648 F.Supp. 879, 883 (D.P.R.1986) (Posadas I ) (applying 30-day statute in suit to vacate different arbitration award between same parties), aff'd, 821 F.2d 60 (1st Cir.1987) (on merits). In reaching this conclusion, the judge relied upon the Puerto Rico Supreme Court's decision in Union de la Industria Licorera de Ponce v. Destileria Serralles, Inc., 116 D.P.R. 348 (1985). In Serralles, confronted with a union's action to vacate the decision of a labor arbitrator and no meaningful legislative standard, the court constructed a comprehensive set of rules to "lay down the procedure to be followed in this type of situation." Official Translation at 5. This construct included the directive that, "[i]f the collective bargaining agreement does not establish a term within which the parties should resort to the judicial forum in order to challenge an [arbitral] award, the parties will have thirty (30) days to do so." Id. at 7 n. 4.

We believe, as did the court below, that Serralles offers the closest state-law analog to the instant case. The 30-day prescriptive period was designed, after all, to govern situations not merely similar but identical to the one at bar. To be sure, appellant maintains that the quoted passage is but a dictum. Yet the passage, if dictum at all, is nonetheless considered dicta, clear and explicit in its import. Because we are bound to accept the interpretation of Puerto Rican law propounded by the Commonwealth's highest tribunal, we believe the Serralles formulation must be treated deferentially.

CPHC's fallback position is that the Puerto Rico Supreme Court overruled Serralles sub silentio in Torres Solano v. Puerto Rico Telephone Co., 87 J.T.S. 3 (1987). That proposition is simply wrong. Torres Solano applied the doctrine of laches to actions seeking judicial review of certain administrative decisions. Official Translation at 6. It did not purport to extend to suits for vacation of labor arbitration awards. Rather, the suggestion that actions to vacate arbitrators' decisions resemble appeals from administrative rulings finds its provenance in Serralles, where the court immediately qualified that comparison by delineating an explicit 30-day time limit pertaining to the former. Serralles, Official Translation at 7 & n. 4. This same reasoning, of course, disposes of appellant's further proffer that perhaps laches--which before February 1989 governed the timeliness of many administrative appeals ²--might be considered as the most appropriate guidance to be derived from local law. When the Commonwealth's highest tribunal custom tailors a rule of decision to suit an idiosyncratic sort of case, it ill behooves a federal court, in the guise of searching out a state-law analogy, to rummage through a collection of looser-fitting garments.

Given the specifics of Serralles, the Commonwealth's 30-day prescriptive period constitutes the point of departure for purposes of our analysis. We turn, therefore, to the question of whether some federal rule would be "significantly more appropriate."

IV

Two items on the shelves of the federal-law cupboard might conceivably trump the Serralles deadline. We identify the contenders.

1. The United States Arbitration Act (USAA). Although the USAA, by its terms, is...