Teamsters Union Local 315 v. Great Western Chemical Co., 84-2047

• Decision Date: 29 January 1986
• Docket Number: No. 84-2047,84-2047
• Parties: 121 L.R.R.M. (BNA) 2666, 54 USLW 2410, 104 Lab.Cas. P 11,780 TEAMSTERS UNION LOCAL 315, Plaintiff-Appellee, v. GREAT WESTERN CHEMICAL COMPANY, Defendant-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 764

781 F.2d 764

121 L.R.R.M. (BNA) 2666, 54 USLW 2410,

104 Lab.Cas. P 11,780

TEAMSTERS UNION LOCAL 315, Plaintiff-Appellee, v. GREAT WESTERN CHEMICAL COMPANY, Defendant-Appellant.

No. 84-2047.

United States Court of Appeals Ninth Circuit.

Argued and Submitted April 12, 1985.

Decided Jan. 29, 1986.

Kenneth N. Silbert, Albert J. Kutchins, Beeson, Tayer & Silbert, San Francisco, Cal., for plaintiff-appellee.

Wayne D. Landsverk, Jack B. Schwartz, Newcomb, Sabin, Meyer & Schwartz, Portland, Or., for defendant-appellant.

Appeal from the United States District Court; for the Northern District of California.

Before DUNIWAY, and CANBY, Circuit Judges, and REDDEN, ^* District Judge.

DUNIWAY, Circuit Judge:

This appeal presents a single question: What statute of limitations should be "borrowed" to apply to this action brought under Sec. 301 of the Labor Management Relations Act, 29 U.S.C. Sec. 185, to compel arbitration of a labor dispute under a collective bargaining agreement providing for arbitration? The trial court applied California's four year statute, Cal.Code Civ.P. Sec. 337: "Within four years: 1. An action upon any contract ... founded upon an instrument in writing, ..." The action was brought within that time, and the court ordered the parties to arbitrate the dispute. We reverse and remand.

I. Facts.

On February 18, 1982, Great Western, the employer, discharged employee Frank Caldera. Four days later, the Union filed a grievance, pursuant to Article 14(A) of the collective bargaining agreement, protesting Caldera's termination and expressing its desire "to meet immediately in an effort to resolve this matter."

Article 14(A) of the Agreement states:

Any grievance or controversy affecting the mutual relations of the Employer and the Union shall first be taken up between the Steward and/or Business Agent and the Manager. If the matter is not resolved within ten (10) days, excluding Saturdays, Sundays and holidays, the parties shall choose an impartial arbitrator and the decision of the arbitrator shall be final and binding on both the parties.

As the dispute remained unresolved, the union requested on March 17, 1982, that the employer take part in the process of selecting an arbitrator. Later, in letters dated July 16, August 23, and December 2, 1982, the union repeatedly informed the employer of its determination to submit the matter to arbitration pursuant to the Agreement.

On October 14, 1983, the union sent a letter to the employer requesting that it explain "why your Company refuses to respond to letters from our attorneys who have been attempting to communicate with your attorneys in order to select an arbitrator in the Frank Caldera termination.... Please respond to this letter as soon as possible. Twenty (20) months is far too long."

Robert Fenton, the employer's Vice President, stated in an affidavit:

I told Mr. Flores [Union's business agent] ... early in 1982 that Great Western did not consider the matter arbitrable and did not intend to submit the matter to an arbitrator. I took that position with the Union each time the subject came up.

Because Fenton's affidavit was filed in opposition to the union's motion for summary judgment, we must accept its allegations as true. Thus, we must assume that the union was informed "early in 1982" that the employer refused to submit to arbitration.

On November 8, 1983, the union filed a Petition to Compel Arbitration in California Superior Court. On December 13, 1983, the employer removed the case to the United States District Court. On December 14, the union filed a Motion for Summary Judgment. On March 14, 1984, the employer also filed a Motion for Summary Judgment. It argued that the union's Petition was barred by the applicable statute of limitations, or by laches, or by both. On April 30, the district court denied the employer's Motion for Summary Judgment and granted the union's Motion for Summary Judgment on the ground that the appropriate limitations period is California's four years, under Cal.Code.Civ.P. Sec. 337.

II. Discussion.

Congress had not enacted a statute of limitations specifically governing actions brought pursuant to Sec. 301 of the Labor Management Relations Act, 29 U.S.C. Sec. 185. "[T]he timeliness of a Sec. 301 suit ... is to be determined, as a matter of federal law, by reference to the appropriate state statute of limitations." Auto Workers v. Hoosier Cardinal Corp., 1966, 383 U.S. 696, 704-705, 86 S.Ct. 1107, 1113, 16 L.Ed.2d 192. The key word in that decision is "appropriate."

A labor-management relations contract is in many respects sui generis. It may involve numerous parties. In our case, the contract is between Great Western, the employer, and a local of the Teamsters Union. But in substance all of the union's members who work for Great Western are also parties. Such a contract governs, during an agreed period of time, the relationship between the employer, the union, and the employees. It may not govern every facet of the relationship, but it does govern many important facets. Moreover, it is a part of the daily lives of the management and the employees.

The labor-management contract also provides its own remedies for violations; here we are concerned with one of them--arbitration. When the grievance, as here, is the discharge of a union member, and his remedy is arbitration, it is important that the remedy be promptly invoked and promptly administered--important to the named parties and especially important to the aggrieved employee union member, and to those in management who have had direct relationships with the grievant. They all need to know where they stand. A long period of controversy and conflict can be a serious burden, both for the grievant and for the management, and can poison the relationship between the contracting parties that the contract was designed to establish and preserve. All of these considerations seem to us to point toward borrowing a statute of limitations that will prescribe a short period for invoking judicial help to compel arbitration.

None of the cases cited by the union requires that we apply Cal.Code Civ.P. Sec. 337 merely because it governs actions for breach of contract and this is such an action. Auto Workers, supra, was an action to recover accumulated vacation pay that the union claimed to have been withheld from discharged employees in violation of a union-management contract. The Court affirmed a holding that applied an Indiana statute requiring that an action for breach of an oral contract be brought within six years, rather than an Indiana statute requiring that an action for breach of a written contract be brought within 20 years. 383 U.S. at 706-707, 86 S.Ct. at 1113-1114. The Court based its decision on the following consideration:

The six months' provision governing unfair labor practice proceedings, 61 Stat. 146, 29 U.S.C. Sec. 160(b), suggests that relatively rapid disposition of labor disputes is a goal of federal labor law. Since state statutes of limitations governing contracts not exclusively in writing are generally shorter than those applicable to wholly written agreements, their applicability to Sec. 301 actions comports with that goal.... [T]here is no reason to inhibit the achievement of an identifiable goal of labor policy by precluding application of the generally shorter limitations provision.

Id. at 707, 86 S.Ct. at 1114. The Court also recognized the distinction between its case and others brought under section 301 of the Labor Management Relations Act:

The present suit is essentially an action for damages caused by an alleged breach of an employer's obligation embodied in a collective bargaining agreement. Such an action closely resembles an action for breach of contract cognizable at common law. Whether other Sec. 301 suits different from the present one might call for the application of other rules on timeliness, we are not required to decide, and we indicate no view whatsoever on that question.

Id. at 705, n. 7, 86 S.Ct. at 1113 n. 7.

Thus, Auto Workers does not require that we find California's four year statute of limitations for breach of a written contract "appropriate" to an action to compel arbitration. This conclusion is reinforced by the availability of alternate statutes of limitations that better fulfill the federal goal of rapid resolution of labor disputes. Id. at 707, 86 S.Ct. at 1114. See United Parcel Service, Inc. v. Mitchell, 1981, 451 U.S. 56, 63, 101 S.Ct. 1559, 1564, 67 L.Ed.2d 732; DelCostello v. International Broth. of Teamsters, 1983, 462 U.S. 151, 168-69, 103 S.Ct. 2281, 2292, 76 L.Ed.2d 476.

The employer suggests two statutes that we might "borrow" and that would prescribe shorter periods than the Cal.Code Civ.P. Sec. 337 period of four years. To these we now turn.

A. Cal.Code Civ.P. Sec. 1288.

Section 1288 is a part of a California law dealing with arbitration proceedings. Cal.Code Civ.P. Tit. 9, Ch. 4, Art. 2. It provides:

A petition to confirm an award shall be served and filed not later than four years after the date of service of a signed copy of the award on the petitioner. A petition to vacate an award or to correct an award shall be served and filed not later than 100 days after the date of the service of a signed copy of the award on the petitioner.

Great Western asks us to borrow the second sentence and impose a 100 day statute of limitations. We find this difficult for several reasons. First, the present action to compel arbitration seems to us more closely analogous to a petition to confirm an award, having a four year limitations period, than to a petition to vacate it. As discussed above, however, a four year period is too long for this case. Great Western's suggested 100 day statute of limitations, on the other hand, is too short because it unnecessarily shortens the time during which the parties can work informally toward a resolution of the dispute. Fed. of Westinghouse Ind. v....