UNITED INDUS. WKRS. OF SEAFARERS, ETC. v. Board of Trustees

• Decision Date: 02 December 1965
• Docket Number: No. 21945.,21945.
• Citation: 351 F.2d 183
• Court: U.S. Court of Appeals — Fifth Circuit
• Parties: UNITED INDUSTRIAL WORKERS OF the SEAFARERS INTERNATIONAL UNION OF NORTH AMERICA, GULF, LAKES AND INLAND WATERS DISTRICT, MARINE ALLIED WORKERS DIVISION, AFL-CIO, Appellant, v. BOARD OF TRUSTEES OF the GALVESTON WHARVES et la., Appellees.

351 F.2d 183 (1965)

UNITED INDUSTRIAL WORKERS OF the SEAFARERS INTERNATIONAL UNION OF NORTH AMERICA, GULF, LAKES AND INLAND WATERS DISTRICT, MARINE ALLIED WORKERS DIVISION, AFL-CIO, Appellant, v. BOARD OF TRUSTEES OF the GALVESTON WHARVES et la., Appellees.

No. 21945.

United States Court of Appeals Fifth Circuit.

September 14, 1965.

Rehearing Denied December 2, 1965.

Newton B. Schwartz, Houston, Tex., C. Paul Barker, New Orleans, La., for appellant.

V. W. McLeod, Galveston, Tex., for appellees.

Before BROWN and BELL, Circuit Judges, and HUNTER, District Judge.

JOHN R. BROWN, Circuit Judge:

The major problem in this appeal from a denial of a preliminary injunction is whether the controversy between the Union¹ and the Carrier² is a minor dispute under the Railway Labor Act. Scarcely concealed behind the facade of this misnamed major-minor figure, is the basic question whether a carrier, after a timely demand for bargaining, has to bargain before it may put into effect during the term of the collective bargaining agreement a nondiscriminatorily motivated lease of its jurisdictional facilities which effectually suspends all such operations of the carrier and the need for operational employees. In answering this, we conclude that what the District Judge thought to be minor was actually a major dispute. We therefore reverse and remand.

As is so often true in these major-minor situations, the facts are simple, neither complex nor conflicting.

The Carrier, Galveston Wharves, the owner and operator of the extensive dock facilities of the Port of Galveston, Texas, has for some activities the status of a carrier by railroad under the Interstate Commerce Act. Among these facilities is Elevator B, a large shipside public grain elevator which it has for many years owned and operated. Presumably because these constitute transportation facilities,³ 49 U.S.C.A. § 1(1) and (3), the Wharf Company as to them is considered to be a common carrier by rail under the Interstate Commerce Act, 49 U.S.C.A. § 1 et seq., and this brings into play the Railway Labor Act, 45 U.S.C.A. § 151 et seq.⁴ Pursuant to the Act, the National Mediation Board, see §§ 154-155, on August 24, 1960, certified the Union as the collective bargaining agent for all elevator employees employed by Carrier, its "successors and assigns."

The collective bargaining Agreement⁵ currently in force when the actions here scrutinized took place was, by its terms, effective as of October 1, 1960. It prescribed that it was to "remain in effect until" September 30, 1963,⁶ but actually it was a "continuous unless" term.⁷ No 60-day termination notice was given in 1963. On the contrary, presumably acting under the proviso (note 7, supra), the parties stipulated in September 1963 that the Agreement "is extended for a one-year period * * * through" September 30, 1964.

On July 20, 1964, as permitted under the Agreement, the Union served formal opener notice on the Carrier that it wished to open the existing contract for negotiation. Thereafter, on July 23, the Carrier advised the Union, presumably for the first time officially at least, that it would not negotiate⁸ presumably because it had leased Elevator B to Port Richmond Elevator Co., Inc.⁹ On the same date, the Carrier posted a notice at Elevator B that all of the employees would be permanently laid off effective midnight July 31, 1964, presumably as a result of the lease.¹⁰ On July 29 the Union served what it now describes as a "section 6" notice requesting negotiation of all matters affecting wages, hours, and working conditions covered by the existing contract and particularly a clause covering shut-down, leasing, or subcontracting.¹¹ The Carrier declined, replying that "It is not possible to reopen the contract under the present conditions." Representatives of Carrier and Union thereafter conferred in several sessions, the first on July 31, the last on August 13, but apparently to no avail.¹² The Union commenced a strike on July 31, 1964.¹³

On July 31, 1964, the Union instituted this action against the Carrier and Lessee. Invoking the Railway Labor Act,¹⁴ it sought, in effect, an injunction against the consummation of the lease or operation under it pending exhaustion of the Railway Labor Act machinery, and also a restoration of the prior status quo. The complaint, setting out the facts briefly summarized here, asserts specifically that the Carrier failed to give the requisite 30 days' notice of proposed changes in violation of § 6¹⁵ (and § 2, subd. 7)¹⁶ of the Act, 45 U.S.C.A. §§ 156 and 152 Seventh.

After earlier denying an ex parte application for temporary restraining order, the District Court, after a hearing apparently all on affidavits and documents, denied the application for preliminary injunction and this appeal followed. 28 U.S.C.A. § 1292(a) (1).

It rounds out this factual summary to state that the Carrier relied on two provisions of the Agreement, the "7-day clause"¹⁷ and the "management rights clause"¹⁸ as the basis for its contention that its actions were sufficiently permitted under the Agreement as to classify the controversy as a grievance for determination by the Railway Adjustment Board.

Before getting into the more troublesome areas as between Union and Carrier, we can quickly dispose of the appeal as to the Lessee Port Richmond.

In a nutshell the Union argues two things. The first is that the representation certificate of the NMB expressly prescribes that the Union is the bargaining representative for the specified "employees of the Galveston Wharves, its successors and assigns." The second is that under contemporary labor law developments, successors are frequently being held to the obligations of their predecessors.

As to the second contention, we would certainly acknowledge that the signs point plainly in the direction of imposing either direct liability or at least the duty to bargain on successors.¹⁹ But the very reason which makes the first contention untenable likewise makes it unnecessary for us to analyze the second. As to each, there is a missing link. This serves to emphasize that even though, as we later hold, operation of the Railway Labor Act does subject the Carrier here to immediate obligations because it has made a lease of limited duration, it does not necessarily follow that Port Richmond, the Lessee, inherits them. The lessee does so only if it too is a carrier under the Act.

Port Richmond, wholly owned as it is by Bunge Corp., likewise unrelated to Carrier, did not require ICC approval for the lease. 49 U.S.C.A. § 5(1). Leasing the facilities did not, therefore, cause it to become a carrier even under the broad sweep of 49 U.S.C.A. § 1 (note 3, supra). And completely independent of Carrier here, it did not become one under the Railway Labor Act, § 1 First, which extends the carrier definition to persons operating "any * * * facilities in connection with * * * elevation * * * storage * * * of property" if such party is "directly or indirectly owned or controlled by" a carrier by railroad. 45 U.S.C.A. § 151 First (see note 4, supra).

Of course it is not a matter of the employer's choice. If a "carrier," the Railway Labor Act applies. If not a carrier, then LMRA applies. 29 U.S.C.A. § 152 (2) (3). Consequently, giving full recognition to the NMB "successors and assigns" certificate, cf. Switchmen's Union of North Amer. v. National Mediation Board, 1943, 320 U.S. 297, 64 S.Ct. 95, 88 L.Ed. 61, it turns out to be irrelevant, cf. Regal Knitwear Co. v. NLRB, 1945, 324 U.S. 9, 65 S.Ct. 478, 89 L.Ed. 661. No matter what it would like to do, Port Richmond must comply with LMRA and except for some rare situations, e. g., § 10(l), see note 10, supra, the Union's redress must be sought and obtained initially from the National Labor Relations Board.

This brings us to the more troublesome problem of the case as between Carrier and Union. The Trial Judge's memorandum opinion indicates that in denying relief, he did two things. First, apparently thinking that the change was not to be a change of the agreement itself and there was some basis for the Carrier's action under the "7-day" and "management rights" clauses (notes 17 and 18, supra), he held this was a minor dispute for resolution by the Railroad Adjustment Board.²⁰ Second, he concluded that equitable considerations did not reasonably require the granting of permissive injunctive relief to preserve the status quo pending decision by the Adjustment Board.

When the actions of the Carrier are carefully analyzed, we think it is clear that this was not a minor dispute. It was major both in fact and in law.

At the outset several things may be briefly emphasized. The first is, of course, that if by its terms of reasonable implication therefrom, the collective agreement apparently affords some arguable basis for the action, the interpretation of the contract, the question of who is right — Carrier or Union — is for determination by the Railroad Adjustment Board,²¹ a Court having jurisdiction only to mold equitable relief to preserve the status quo pending Adjustment Board decision.²² The result ordinarily is that unless the proposed change is to be reflected in a change in the agreement, it is not a § 6 situation and remains a minor dispute.²³ But this is to be tested as a matter of substance since a carrier in imposing changes in nowise contemplated or arguably covered by the agreement is not to escape the impact of the Act merely through the device of unilateral action which it purposefully intends is not to become a part of the written agreement.²⁴ This follows from the force of § 2 Seventh (see note 16, supra) and the law's refusal to determine "major" or "minor" by the labels affixed by the interested combatants through artfully contrived formalistic demands or responses.²⁵

When we look at the sharp outlines of this case through ordinary glasses, not major or minor lenses, we can see this case for what it really...