Reed v. United Transp. Union

• Decision Date: 01 May 1986
• Docket Number: No. C-C-85-477-P.,C-C-85-477-P.
• Citation: 633 F. Supp. 1516
• Court: U.S. District Court — Western District of North Carolina
• Parties: G.P. REED, Plaintiff, v. UNITED TRANSPORTATION UNION, Fred A. Hardin, K.R. Moore, and J.L. McKinney, Defendants.

633 F. Supp. 1516

G.P. REED, Plaintiff, v. UNITED TRANSPORTATION UNION, Fred A. Hardin, K.R. Moore, and J.L. McKinney, Defendants.

No. C-C-85-477-P.

United States District Court, W.D. North Carolina, Charlotte Division.

May 1, 1986.

John W. Gresham, Ferguson, Watt, Wallas & Adkins, Charlotte, N.C., for plaintiff.

Clinton J. Miller, III, Asst. Gen. Counsel, United Transp. Union, Cleveland, Ohio, J. David James, Jonathan R. Harkavy, Smith, Patterson, Follin, Curtis, James & Harkavy Greensboro, N.C., for defendants.

ORDER

ROBERT D. POTTER, Chief Judge.

THIS MATTER was heard before the undersigned on January 31, 1986 in Charlotte, North Carolina on the Defendants' Motion to dismiss or for summary judgment. The Defendants were represented by Clinton J. Miller and J. David Jones, Attorneys at Law. The Plaintiff was represented by John W. Gresham, Attorney at Law.

The Plaintiff, G.P. Reed, is the Secretary/Treasurer of Local 1715 of the Defendant United Transportation Union, which is a labor organization within the meaning of 29 U.S.C. § 401 et seq. In August 1982, Defendant Fred A. Hardin, President of the Union, sent Defendant J.L. McKinney, International Auditor of the Union, to Charlotte, North Carolina to audit the books and records of Local 1715. The audit was prompted by a letter to Defendant Hardin from a member of Local 1715 regarding his concerns about the financial stability and future of the Local. As a result of the audit, Defendant McKinney disallowed checks paid by the Local to the Plaintiff for "time lost" in the amount of $1,210.20.

The Plaintiff paid the amount disallowed, but appealed Defendant McKinney's findings to Defendant Hardin by way of a letter dated September 6, 1982. The Plaintiff claimed that the repayment of the $1,210.20 was demanded on the ground that he was required to get approval for reimbursement for "time lost" to do various tasks before "losing" the time and doing the work. He further claimed that no such prior approval requirement had existed or been enforced before its application to him.

Defendant Hardin denied the Plaintiff's appeal in a letter dated October 1, 1982. Hardin explained that when a local officer is salaried, his regular salary is meant to cover the responsibilities of his office. He noted that the payments that were disallowed had been claimed for the performance of ordinary duties and responsibilities of his office.

The Plaintiff subsequently sought to enforce the "prior approval" policy he claims had been applied to him when Local President Fred Warlick and another Local officer requested reimbursement for time spent on Local 1715 business for which the Local had not given prior approval. Defendant Hardin, however, ordered the Plaintiff to pay those claims.

On June 28, 1983, the Plaintiff met with Defendant K.R. Moore, Vice President of the Union, to determine whether the Union planned to continue to enforce dual policies with respect to expense payments by denying his appeal for reimbursement. The Plaintiff claims that Defendant Moore refused to discuss the matter.

On July 1, 1983, the Plaintiff's attorney wrote to Defendant Hardin complaining about the $1,210.20 repayment the Plaintiff was required to make to the Union after the audit as a result of the different standards allegedly applied to the Plaintiff and other Union members with regard to payment of Union expenses. He asserted that the heart of the conflict involved Local President Warlick's actions to harass the Plaintiff for not supporting his views, and that if the Union supported Warlick in those efforts, it would be in violation of 29 U.S.C. § 411.

On July 22, 1983, Defendant Hardin responded to the Plaintiff's attorney, stating that the issue concerning the time disallowed as a result of the audit had been considered closed once the Plaintiff had made his repayment to the Union.

On August 2, 1983, the Plaintiff's attorney sent Defendant Hardin another letter, in which he reported that he had advised the Plaintiff of Hardin's response concerning his request for reimbursement. He also informed Defendant Hardin that he had advised the Plaintiff "to commence litigation on or about September 15, 1983, unless the Union has properly reviewed and reconciled this matter." Letter dated August 2, 1983 from John Gresham, Esq. to Union President Hardin.

The Plaintiff filed this action on August 2, 1985, exactly two years after his attorney's last letter to Defendant Hardin. In his Complaint, the Plaintiff raises claims under the Labor-Management Reporting and Disclosure Act, 29 U.S.C. § 401 et seq. ("LMRDA") as well as pendent state implied contract and quantum meruit claims. Specifically, the Plaintiff claims that the Defendants have violated the Plaintiff's rights to freedom of speech and assembly as a union member as well as his right to be safeguarded from improper disciplinary action under Title I of the LMRDA, 29 U.S.C. § 411 et seq.¹ He claims that the selective application of the "prior approval" policy to disallow his claims was meant to punish him for speaking out against Local President Warlick, whose claims for reimbursement were not denied despite his failure to obtain prior approval for his "time lost." He also claims that the Defendants have not properly exercised their fiduciary duties as officers of the Union pursuant to Title V of the LMRDA, 29 U.S.C. § 501.²

Whether the Court may entertain the Plaintiff's claim under § 411 of Title I of the LMRDA depends on whether that claim has been brought in a timely fashion. Because Congress has not explicitly provided a limitations period for such claims, the Court must "borrow" the most appropriate statute of limitations from some other source.

The last Fourth Circuit case to address the issue of what statute of limitations to apply to a claim under § 411 of the LMRDA was Howard v. Aluminum Workers International Union, 589 F.2d 771 (4th Cir.1978). In Howard, the Fourth Circuit noted that courts "have found that denial of free speech is similar to a personal injury under state law and have applied tort limitations statutes to such claims." Id. at 774. Accordingly, the Court determined that Virginia's two-year statute of limitations for personal injury claims should apply to the Plaintiff's claim that his union had abridged his right of free speech guaranteed by Title I of the LMRDA.

Since Howard represents the Fourth Circuit's last word on the appropriate limitations period for actions brought under Title I of the LMRDA, the Plaintiff contends that this Court is bound to apply North Carolina's three-year statute of limitations for personal injury actions. The Defendant, on the other hand, relies on the Supreme Court's more recent opinion in DelCostello v. International Brotherhood of Teamsters, 462 U.S. 151, 103 S.Ct. 2281, 76 L.Ed.2d 476 (1983), and its progeny and argues that the Court should apply the six-month limitations period of Section 10(b) of the National Labor Relations Act for unfair labor practices charges to the Plaintiff's LMRDA Title I claim.

The task before the Court in DelCostello was the selection of an appropriate statute of limitations for a "hybrid" action combining (1) a union member's claim against his employer under § 301 of the Labor Management Relations Act for violation of a collective bargaining agreement, and (2) his claim against his union for breach of its implied duty of fair representation in its handling of his grievance against the employer. The Court stated at the outset of its opinion that it has "generally concluded that Congress intended that the courts apply the most closely analogous statute of limitations under state law" when federal law fails to provide explicitly for a limitations period for a federal action. Id. at 158, 103 S.Ct. at 2287. The Court noted, however, that "in some circumstances, ... state statutes of limitations can be unsatisfactory vehicles for the enforcement of federal law. In those instances, it may be inappropriate to conclude that Congress would choose to adopt state rules at odds with the purpose or operation of federal substantive law." Id. at 172, 103 S.Ct. at 2294.

The Court proceeded to reject the state statutes of limitations suggested by the parties because they provided imprecise analogies to the claims in the hybrid action and failed to accommodate the policy considerations underlying the hybrid action. The Court found the usual ninety-day statute of limitations for the vacation of arbitration awards to be too short to provide an employee with a "satisfactory opportunity to vindicate his rights under § 301 and the fair representation doctrine." Id. at 166, 103 S.Ct. at 166. On the other hand, the Court determined malpractice limitations periods, varying from three years to ten years, to be too long in light of the strong federal interest in speedy resolution of suits involving the grievance and arbitration procedures of a collective bargaining agreement. Id. at 168-69, 103 S.Ct. at 2292-93. The Court adopted instead the six-month limitations period of § 10(b) of the National Labor Relations Act, "a federal statute of limitations actually designed to accommodate a balance of interests very similar to those at stake here — a statute that is, in fact, an analogy to the present lawsuit more apt than any of the suggested state-law parallels." Id. at 169, 103 S.Ct. at 2293.

In deciding to apply § 10(b)'s six-month period to the hybrid action, the Court first noted that a "substantial overlap" often exists between claims against a union for breach of its duty of fair representation, against an employer for breach of a collective bargaining agreement, and unfair labor practice charges. It found that "fair representation claims are allegations of unfair, arbitrary, or discriminatory treatment of workers by unions — as are virtually all unfair labor practice charges made by workers against unions." Id. at 170, 103 S.Ct. at 2293. It further stated that "it...