State v. Montgomery Ward & Co.

• Decision Date: 19 June 1951
• Docket Number: No. 7492,7492
• Citation: 120 Utah 294,233 P.2d 685
• Parties: STATE, v. MONTGOMERY WARD & CO., Inc.
• Court: Utah Supreme Court

Page 685

233 P.2d 685

120 Utah 294

STATE, v. MONTGOMERY WARD & CO., Inc.

No. 7492.

Supreme Court of Utah.

June 19, 1951.

Clinton D. Vernon, Atty. Gen., Mark K. Boyle, Asst. Atty. Gen., Brigham E. Roberts, Dist. Atty., Clarence M. Beck, Reid W. Nielsen, Salt Lake City, for appellant.

George A. Critchlow, Salt Lake City, Thomas L. Cochran, Oakland, Cal., of counsel, for respondent.

WOLFE, Chief Justice.

One Walter Knorr executed and delivered the following written assignment of a portion of his wages to his employer, Montgomery Ward & Co., the respondent:

'Authorization and Assignment for Check Off

'I, the undersigned member of Local Union No. 222 International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, A. F. of L., do hereby authorize and direct my employer Montgomery Ward and Company to deduct from my wages each month the sum of $4.00 as membership dues, which includes initiation fees, fines and assessments, due said union pursuant to my membership therein, providing such deductions does [sic] not exceed 3% of my monthly wages, and to pay the sum to the Secretary of said Union or such part thereof as may be determined by him and at such times as he may request, to whom I hereby assign the same, and I hereby direct and authorize my said employer to make such deductions and so pay the same until I otherwise direct through an instrument in writing.

'Dated at Salt Lake City, Utah, this 19 day of Sept. 1949.

'/s/ Walter Knorr'

The respondent refused to honor the assignment and a criminal complaint was filed against it charging the violation of Sections 49-14-1 and 3, Utah Code Annotated 1943, which provide respectively as follows:

'Whenever an employee of any person, firm, school district, private or municipal corporation within the state of Utah executes and delivers to his employer an instrument in writing whereby such employer is directed to deduct a sum at the rate not exceeding three per cent per month, from his wages and to pay the same to a labor organization or union or any other organization of employees as assignee, it shall be the duty of such employer to make such deduction and to pay the same monthly or as designated by employee to such assignee and to continue to do so until otherwise directed by the employee through an instrument in writing.'

'Any employer * * * who wilfully fails to comply with the duty here imposed shall be guilty of a misdemeanor.'

After being bound over to the district court by a committing magistrate, an information was filed in that court charging the respondent with the willful violation of the above sections. At the arraignment, the respondent moved to quash the information and after taking the matter under advisement, the district court granted the motion to quash. The State prosecutes this appeal from a judgment dismissing the action.

It was stipulated by the parties that the respondent was an employer and that Walter Knorr was an employee in 'industry affecting commerce' as that term is used in the Labor Management Relations Act, 1947, colloquially known as the Taft-Hartley Act, 61 Stat. 136, c. 120, 29 U.S.C.A. Sec. 141 et seq., hereinafter referred to as the L.M.R.A., and that both the respondent and Knorr are subject to the provision of that act. The question which divides the parties, and which is the sole question for our determination, is whether the above-mentioned Utah statute is repugnant to section 302 of the L.M.R.A. The appellant contends that Congress in the L.M.R.A. did not preempt the field of legislation on the subject of the 'check-off' ¹, but left to the States an area within which they may legislate in regard to that subject, and asserts that secs. 49-14-1 and 3, U.C.A. 1943, do not conflict with sec. 302 but complement it. Sec. 302 of the L.M.R.A. so far as applicable here provides:

'(a) It shall be unlawful for any employer to pay or deliver, or to agree to pay or deliver, any money or other thing of value to any representative of any of his employees who are employed in an industry affecting commerce.

'(b) It shall be unlawful for any representative of any employees who are employed in an industry affecting commerce to receive or accept, or to agree to receive or accept, from the employer of such employees any money or other thing of value.

'(c) The provisions of this section shall not be applicable (1) * * *; (2) * * *; (3) * * *; (4) with respect to money deducted from the wages of employees in payment of membership dues in a labor organization: Provided, That the employer has received from each employee, on whose account such deductions are made, a written assignment which shall not be irrevocable for a period of more than one year, or beyond the termination date of the applicable collective agreement, whichever occurs sooner; or (5) * * *.

'(d) Any person who willfully violates any of the provisions of this section shall, upon conviction thereof, be guilty of a misdemeanor and be subject to a fine of not more than $10,000 or to imprisonment for not more than one year, or both.'

Neither party has cited any judicial decisions determining what effect, if any, section 302 of the L.M.R.A. has upon state statutes regulating or controlling the 'check-off'. In support of its position, however, the appellant refers us to the case of Algoma Plywood & Veneer Co. v. Wisconsin Employment Relations Board, 336 U.S. 301, 69 S.Ct. 584, 589, 93 L.Ed. 691, in which, it is claimed, the Supreme Court of the United States determined an analogous question. In that case, the Company, a manufacturer of products sold chiefly in interstate commerce, had agreed to a 'maintenance-of-membership' clause in a contract with a union. That clause provided that all employees, who on the date of the signing of the agreement were members of the union, should, during the life of the agreement, as a condition of employment remain members of the union in good standing. When one Victor Moreau willfully refused to pay his union dues, he was discharged by the Company. Moreau thereupon filed a complaint with the Wisconsin Employment Relations Board charging the Company with an unfair labor practice under Wis. Stat. sec. 111.06 providing that: '(1) It shall be an unfair labor practice for an employer * * * (c) 1. To encourage * * * membership in any labor organization * * * by discrimination in regard to hiring, tenure or other terms or conditions of employment; provided, that an employer shall not be prohibited from entering into an all-union agreement with the representatives of his employes in a collective bargaining unit, where at least two-thirds of such employes voting * * * shall have voted affirmatively by secret ballot in favor of such allunion agreement in a referendum conducted by the board. * * *' Because no referendum had been conducted at the Company plant, the Board ordered the Company to cease and desist from giving effect to the 'maintenance-of-membership' clause in the agreement, to offer Moreau reinstatement, and to make him whole for loss of pay.

Upon certiorari to the Supreme Court of the United States, the Company and the union joined in contesting the jurisdiction of the Wisconsin Employment Relations Board on the ground that by section 10(a) of the National Labor Relations Act, 49 Stat. 449, 453, c. 372, 29 U.S.C.A. Sec. 160(a) (hereafter in this opinion designated as the N.L.R.A.), Congress had vested in the National Labor Relations Board the exclusive power to prevent unfair labor practices affecting interstate commerce. Sec. 10(a) of the N.L.R.A. provides that: 'The Board is empowered, as hereinafter provided, to prevent any person from engaging in any unfair labor practice (listed in section 8) affecting commerce. This power shall be exclusive, and shall not be affected by any other means of adjustment or prevention that has been or may be established by agreement, code, law, or otherwise.' The Supreme Court held that section 10(a) specifically limited the exclusive power of the National Labor Relations Board to prevent unfair labor practices to those practices listed in section 8 of the N.L.R.A. and did not preclude the States from preventing other practices which they deemed unfair not listed in sec. 8, such as that enjoined by Wis.Stat. sec. 111.06(1)(c) 1, quoted above.

It was further contended by the Company and the union that the aforementioned Wisconsin statute was repugnant to section 8(3) of the N.L.R.A., 49 Stat. 452, c. 372, 29 U.S.C.A. Sec. 158(3), providing that it shall be an unfair labor practice for an employer: 'By discrimination in regard to hire or tenure of employment or any term or condition of employment to encourage or discourage membership in any labor organization: Provided, That nothing in this Act * * * or in any other statute of the United States, shall preclude an employer from making an agreement with a labor organization * * * to require as a condition of employment membership therein, if such labor organization is the representative of the employees as provided in section 9(a), in the appropriate collective bargaining unit covered by such agreement when made.' The court held that there was no repugnancy because section 8(3) did not authorize the making of closed shop or other union security agreements including maintenance-of-membership agreements, nor did it attempt to make them legal in states where they were illegal, but that section 8(3) was merely a declaration by Congress that nothing in any federal law should be held to illegalize union security agreements voluntarily entered into between employers and workers. Said the court: 'It is argued, therefore, that a State cannot forbid what Sec. 8(3) affirmatively permits. The short answer is that Sec. 8(3) merely disclaims a national policy hostile to the closed shop or other forms of union-security agreement. This is the obvious inference to be drawn from the choice of the words 'nothing in this Act * * * or in any...