RASTALL v. CSX TRANSP., INC.

• Decision Date: 08 May 1990
• Docket Number: No. 89-261,89-261
• Citation: 574 A.2d 271
• Parties: Stephen RASTALL, et al., Appellants, v. CSX TRANSPORTATION, INC., Appellee.
• Court: D.C. Court of Appeals

574 A.2d 271

Stephen RASTALL, et al., Appellants, v. CSX TRANSPORTATION, INC.,Appellee.

No. 89-261.

District of Columbia Court of Appeals.

Argued February 14, 1990.

Decided May 8, 1990.

Appeal from the Superior Court, District of Columbia, Frederick H. Weisberg, J.

Richard A. Allen, with whom Sherrice A. Knisley was on the brief, for appellants.

Jack L.B. Gohn, with whom Steven M. Levine and H. Russell Smouse were on the brief, for appellee.

Before ROGERS, Chief Judge, and FERREN and FARRELL, Associate Judges.

FARRELL, Associate Judge:

This is an appeal from an order of the Superior Court granting summary judgment in favor of appellee, defendant below, CSX Transportation, Inc. (CSXT).¹ The action was brought by appellants Stephen Rastall and Timothy Gowdey, Canadian employees of CSXT, on behalf of themselves and all past, present and future Canadian employees,² and alleged a breach of provisions of a collective bargaining agreement between the company and its Canadian employees whereby CSXT purportedly had agreed to pay the wages, pensions and other benefits of the employees in United States dollars.³

Shortly after the complaint was filed, CSXT removed the case to the United States District Court for the District of Columbia asserting federal question jurisdiction, 28 U.S.C. § 1331 (1982),⁴ on thegrounds that either the Railway Labor Act (RLA), 45 U.S.C. § 151-88 (1982), or the Labor Management Relations Act (LMRA), 29 U.S.C. § 185 et seq., applied to the dispute and required the parties to submit disputes such as this one to arbitration.⁵ The district court, however, remanded the case to the Superior Court after concluding that neither the RLA nor the LMRA has extraterritorial effect so as to apply to CSXT's Canadian employees. Rastall v. CSX Corp., supra note 4, 696 F. Supp. at 684-85.

CSXT renewed its motion to dismiss in the Superior Court, again asserting that arbitration of this dispute is mandated by either the RLA or the LMRA, thus depriving the courts of jurisdiction to rule on the breach of contract claim.⁶ CSXT also contended that if United States labor law did not apply to Canadian employees, then the Canadian Labour Code applied and similarly required arbitration. The trial court declined to rule on the application of federal or Canadian law to the dispute, but instead concluded that the dispute resolution provisions of the labor contracts themselves required the parties to submit to binding arbitration. He therefore granted CSXT's motion for summary judgment.⁷

On appeal, the employees contend that the trial court erred in failing to heed the plain language of the collective bargaining agreements which, they assert, expressly gives Canadian employees the choice of submitting their grievances to arbitration or bringing an action in court. CSXT, on the other hand, while defending the trial court's contract interpretation, urges that the court lacked jurisdiction to rule on the matter to begin with because the RLA deprives the courts of jurisdiction over "minor disputes" such as this one in favor of mandatory arbitration. In the alternative, CSXT contends that either the LMRA, federal common labor law, or the Canadian Labour Code applies to the present dispute and equally compels arbitration.

For the reasons set forth below, we reverse the grant of summary judgment in CSXT's favor and remand the case for further proceedings.

I.

Before dealing with the interpretation of the dispute resolution provisions, we must address CSXT's argument that the Superior Court lacked jurisdiction to reach the contractual issues. Any such action, it contends, is preempted by the requirement of arbitration imposed by the RLA, the LMRA, or Canadian labor law. We are unpersuaded.

With regard to the RLA, we agree with United States District Judge Gesell that it does not apply to foreign employees performing services entirely outside the United States. 696 F. Supp. at 684. Indeed, the United States Court of Appeals for the District of Columbia Circuit expressly so held in Air Line Dispatchers Ass'n v. National Mediation Bd., 89 U.S.App.D.C. 24, 29, 189 F.2d 685, 690 (1951), a holding that would appear to bind us. See M.A.P. v. Ryan, 285 A.2d 310, 312 (D.C. 1979). Even if we were not bound by Air Line Dispatchers, our own reading of the statute is in accord with its holding.⁸ Weare confirmed in that reading by the consistent body of federal law elsewhere holding that the RLA has no extraterritorial effect. See Air Line Stewards & Stewardesses Ass'n v. Northwest Airlines, 267 F.2d 170, 175 (8th Cir.), cert. denied, 361 U.S. 901, 80 S.Ct. 208, 4 L.Ed.2d 156 (1959); Vollmar v. CSX Transp., Inc., supra note 8, 705 F. Supp. at 1164-65; General Comm. on Adjustment v. United States, 102 L.R.R.M. 2869, 2871, 1979 WL 1862 (D.Minn. 1979), aff'd, 620 F.2d 161 (8th Cir.), cert. denied, 449 U.S. 826, 101 S.Ct. 88, 66 L.Ed.2d 29 (1980); Air Line Stewards & Stewardesses Ass'n v. Transworld Airlines, 173 F. Supp. 369, 374-78 (S.D.N.Y.), aff'd, 273 F.2d 69 (2d Cir. 1959), cert. denied, 362 U.S. 988, 80 S.Ct. 1075, 4 L.Ed.2d 1021 (1960).

With regard to the LMRA, its application to foreign employees is doubtful, Windward Shipping Ltd. v. American Radio Ass'n, 415 U.S. 104, 110, 94 S.Ct. 959, 963, 39 L.Ed.2d 195 (1974); Benz v. Campania Naviera Hidalgo, 353 U.S. 138, 144, 77 S.Ct. 699, 702, 1 L.Ed.2d 709 (1957). We need not stop to consider that issue, however, because even if applicable in the present context, the LMRA contains no language requiring arbitration in the face of an agreement providing otherwise, nor does CSXT so contend. It merely asserts that, "[u]nder the LMRA, the Appellants would certainly be required to arbitrate under any agreement which called for arbitration . . . ." Since, as we demonstrate later, the present agreement does not require Canadian employees to submit their disputes to arbitration, the argument that arbitration is mandated by the LMRA is without merit.⁹

Lastly, we reject CSXT's argument that the Canadian Labour Code, R.S.C. 1970, c. L-1, requires the parties to submit to binding arbitration. It is unnecessary to consider the employees' contention that, under choice of law principles, it is not Canadian law but the law of Maryland, Michigan, and the District of Columbia that governs whether this dispute was required to be arbitrated. Assuming arguendo that Canadian law applies, it too does not require arbitration in the face of an agreement providing otherwise.

Section 155(1) of the Canadian Labour Code provides:

Every collective agreement shall contain a provision for final settlement without stoppage of work, by arbitration or otherwise, of all differences between the parties to or employees bound by the collective agreement, concerning its interpretation, application, administration or alleged violation. [Emphasis added.]

In St. Anne Nackawic Pulp & Paper Co. Ltd. v. Canadian Paper Workers Union Local 219, [1986] S.C.R. 704, 723, the Canadian Supreme Court, interpreting the identical phrase in section 55(1) of the New Brunswick Labour Relations Act, N.B. REV.STAT. 1973, c. 1-4, stated:

What the statute does is to establish a preference for arbitration of a particular sort over other means of dispute settlement, by establishing a procedure to be followed where the parties do not expressly provide for any other method of resolving their differences. Where the parties [have chosen otherwise], however, the New Brunswick Act, in common with most of the other Canadian labour relations statutes, does not actually require the parties to resort to arbitration. It requires a provision in the collective bargaining agreement for "final and binding settlement by arbitration or otherwise, without stoppage of work". The emphasized words indicate that, if they so choose, the parties may validly provide for a variety of other sorts of settlement mechanisms, including recourse to the courts. [Emphasis in original.]

As this language makes clear, Canadian labor law expresses a preference for arbitration but does not mandate it where the collective bargaining agreement negotiated by the parties specifically permits an alternative form of dispute resolution, including recourse to the courts.¹⁰

II.

A.

We thus turn to the question of whether appellants are contractually bound to arbitrate the present dispute. At issue are twelve collective bargaining agreements governing relations between the Canadian employees and CSXT, which became effective around 1955. The crafts represented in the dispute include the Carmen, Clerks, Dispatchers, Locomotive Engineers, Locomotive Firemen, Oilers, Mechanical Employees, Maintenance of Way Employees, Signalmen, Supervisors, Trainmen and Yardmen. The bargaining agreements contain two types of dispute resolution provisions. The most common, found in seven of the agreements, is exemplified by Rule 32 of the agreement with the Brotherhood of Railway Carmen. Rule 32(1)(c) provides, in relevant part:

All claims or grievances involved in a decision by the highest designated officer shall be barred unless within 9 months from the date of said officer's decision proceedings are instituted by the employee or his duly authorized representative before the appropriate division of the National Railroad Adjustment Board or a system, group or regional board of adjustment that has been agreed to by the parties hereto provided in Section 3 Second of the Railway Labor Act.

Rule 32(4), however, provides:

This Rule is not intended to deny the right of the employees to use any other lawful action for the settlement of claims or grievances provided such action is instituted within 9 months of the date of the decision of the highest designated officer of the Carrier. [Emphasis added.]

The other five agreements contain language exemplified by Rule 98(c) of the agreement with the Brotherhood of Locomotive Engineers, which provides in part:

Decisions by the highest officer designated to...