Wise v. Southern Pacific Co.

• Decision Date: 23 April 1969
• Citation: 77 Cal.Rptr. 156
• Court: California Court of Appeals Court of Appeals
• Parties: 71 L.R.R.M. (BNA) 2505 Wayne E. WISE, Plaintiff and Respondent, v. SOUTHERN PACIFIC COMPANY, a corporation, Defendant and Appellant. Civ. 25261.

Page 156

77 Cal.Rptr. 156

71 L.R.R.M. (BNA) 2505

Wayne E. WISE, Plaintiff and Respondent, v. SOUTHERN PACIFIC COMPANY, a corporation, Defendant and Appellant.

Civ. 25261.

Court of Appeal, First District, Division 3, California.

April 23, 1969.

Rehearing Denied May 23, 1969.

For Opinion on Hearing, see 83 Cal.Rptr. 202, 463 P.2d 426.

William R. Denton, W.A. Gregory, San Francisco, for appellant.

Leo Fried, San Francisco, Perkins, Carr & Anderson, Sacramento, for respondent.

DAVID, Associate Justice pro tem. ^*

Suit for wrongful discharge. The Southern Pacific Company appeals the judgment for plaintiff Wise in the sum of $17,737.56, given in a nonjury trial.

Wayne E. Wise, carman, was discharged by his employer, Southern Pacific Company, on February 10, 1960, for violation of Rule 803 of the General Rules and Regulations of the company, reading, "Any act of hostility, or wilful disregard of the Company's interests will not be condoned." This occurred after a hearing, concerning his alleged solicitation of "various employes of the Southern Pacific Company during the years 1957 and 1958 for the purpose and with the intent of inducing these employes to bring personal injury lawsuits against this company and to hire certain attorneys-at-law to handle and prosecute their said personal injury claims and lawsuits against this company."

The collective bargaining agreement between the company and System Federation No. 114, Railway Employes Department, American Federation of Labor, provided in Rule 46, in part, "All claims for personal injuries shall be handled with the Personal Injury Claim Department."

Rule 39 of the applicable collective bargaining agreement provided "No employe shall be disciplined, or dismissed, without a fair hearing by the proper officer of the Company * * *. At a reasonable time prior to the hearing, such employe shall in writing, be apprised of the precise charge against him, be given reasonable opportunity to secure the presence of necessary witnesses, and shall have the right to be represented as provided for in Rule 38. If it is found that an employe has been unjustly suspended or dismissed from the service, such employe shall be reinstated with his seniority rights unimpaired, and compensated for the wage loss, if any, resulting from said suspension and dismissal. Stenographic report of hearing will be taken, if requested, and employe's representative will be furnished with a copy."

In private, as well as public employment, an employe accepts employment subject to conditions prescribed by contract, or by law.

"This latter prescription of the statute makes it quite evident that 'the Railway Labor Act does not empower the courts to enforce against railroads any prescribed procedure for investigating and discharging its employees * * * ' Brooks v. Chicago, R.I. & P.R. Co., 177 F.2d 385, 391 (8 Cir.1949)." The provisions of the Railway Labor Act do not interfere with the normal exercise of the right of the carrier to select its employes or to discharge them. (Virginian Ry. Co. v. System Federation No. 40,300 U.S. 515, 559, 57 S.Ct. 592, 81 L.Ed. 789.) Any limitations on the exercise of those rights substantively or procedurally must be found, if any exist, in the collective bargaining agreement.

Provisions for such a hearing in Sections 38 and 39 of the collective bargaining agreement effectuate the duty of both carriers and employes to exert every reasonable effort to settle all disputes in conference between representatives of employes and the carrier, as is imposed by Section 2, subsections 1 and 2 of the Railway Labor Act. But the provisions of that act do not govern the procedure by which a carrier may discharge employes, nor the conduct of an investigation conducted on railroad property. The act contemplates that disputes growing out of grievances, or out of the interpretation or application of agreements shall, prior to reference to the Adjustment Board, be handled in the usual manner up to and including the chief operating officer of the carrier designated to handle such disputes. The act does not supersede the provisions as to conferences, by whatever name they are called, found in the contractual agreement.

"Therefore, when a railroad employee questions the propriety of the initial hearing held on carrier property, his claim must be based on the provisions of the collective bargaining agreement relating to that subject." (Edwards v. St. Louis-San Francisco Railroad Company, 7 Cir., 361 F.2d 946, 953.) ¹

Rule 39 of the collective bargaining agreement, quoted at the beginning of this opinion, provides the only substantive or procedural "due process" in such instances.

We have set forth above the company's allegation that Mr. Wise had violated Rule 803. Pursuant to Rule 39, Wise was notified; a formal hearing was held; witnesses were produced and gave statements; their previous subscribed written statements were considered; Mr. Wise cross-examined the witnesses, produced some of his own, and presented documentary testimony.

At the hearing Mr. Wise had three union representatives. Their status at a disciplinary hearing is not clear from Rule 38, to which Rule 39 refers, except in the appellate stages. Subsection 38(g) states: "This rule recognizes the right of representatives of the Organizations, parties hereto, to file and prosecute claims and grievances for and on behalf of the employes they represent." In any event the three representatives, as well as Mr. Wise, took a prominent and vocal part in the hearing and examination of witnesses.

R.D. Spence, superintendent of the Sacramento division, presided as hearing officer. The hearing concluded, the transcript was forwarded to higher officials, who discharged Mr. Wise on February 10, 1960.

No contractual provision cited to us indicates any limitation upon the employer's right to determine what is, or is not, just cause for discharge. Southern Pacific Company is shown to have adopted rules concerning employe conduct. No reason is advanced, and we discern none, why they were not applicable to Mr. Wise as an employe. Likewise, it appears to be well-established law that the sufficiency of the reason for discharge, in the absence of contract or law otherwise, is not a justiciable question. (31 Am.Jur., p. 390, § 8.) It is said that even though not specified in the contract, an employer may discharge an employe for any legal cause. (Twentieth Century-Fox Film Corp. v. Lardner, 9 Cir., 216 F.2d 844, 51 A.L.R.2d 728, cert. den. 348 U.S. 944, 75 S.Ct. 365, 99 L.Ed. 739, reh. den. 348 U.S. 965, 75 S.Ct. 522, 99 L.Ed. 753.)

Disloyalty to the employer or the employer's interest is a private treason which unquestionably is just cause for dismissal of an employe. In National Labor Relations Board v. Local Union No. 1229 International Brotherhood of Electrical Workers, 346 U.S. 464, 472, 74 S.Ct. 172, 176, 98 L.Ed. 195, the United States Supreme Court stated: "There is no more elemental cause for discharge of an employee than disloyalty to his employer." The court stated (p. 475, 74 S.Ct. p. 177.) "The courts have refused to reinstate employees discharged for 'cause' consisting of insubordination, disobedience or disloyalty."

No employer, public or private, may justly be called upon to employ and pay termites or teredos to bore in and weaken the organization they are employed to maintain and which maintains them; even when they have strong conflicting loyalties, and feel personally justified.

"No servant can serve two masters: for either he will hate the one, and love the other; or else he will hold to the one, and despise the other." (St. Luke 16.13.)

One of the foundation stones of private business is that the employe must be loyal to his employer. "Loyalty is implicit in the contract of hiring. No private business can succeed without the conscientious, undivided support of its employees. The man or woman who denies allegiance to his employment is, and should be, soon separated from it. Nemesis with a club waits for him around the corner. And, so long as the employment continues, every employer has the right at any time to ask his employee to declare his loyalty." (Garner v. Board of Public Works, 98 Cal.App.2d 493, 498, 220 P.2d 958, 961; Black v. Cutter Laboratories, 43 Cal.2d 788, 806, 278 P.2d 905.)

Upon discharge, under Rule 38(c) and (h) of the collective bargaining agreement between Southern Pacific and System Federation No. 114 (as revised and reprinted April 19, 1957), Mr. Wise had a choice of further action. Rule 38(e) provides in part: "All claims or grievances involved in a decision by the highest designated officer shall be barred unless within nine (9) months from the date of said officer's decision proceedings are instituted by the employe 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 here-to as provided in Section 3 Second of the Railway Labor Act. It is understood, however, that the parties may by agreement in any particular case extend the nine (9) months' period herein referred to." Rule 38(h) provides: "This rule is not intended to deny the right of the employes to use any other lawful action for the settlement of claims or grievances provided such action is instituted within nine (9) months of the date of the decision of the highest designated officer of the Carrier."

There are marked differences between the procedures and remedies upon appeal to the National Railroad Adjustment Board [45 U.S.C.A. §§ 151, 153] on the one hand, and the current suit for breach of the contract of employment on the other. The Second division of the Board having jurisdiction over carmen's disputes can make a speedy and adequate determination of a cause, after exhaustion of the appeals provided for in Section 38 of the bargaining agreement. A state court may not order...