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Sheet Metal Workers Intern. Ass'n v. Nichols

Supreme Court of Arizona

March 8, 1961

SHEET METAL WORKERS INTERNATIONAL ASSOCIATION, an unincorporated association, Appellant,
v.
Carl A. NICHOLS, Appellee.

Rehearing Denied May 23, 1961.

Page 205

[89 Ariz. 188] Darrell R. Parker and C. A. Muecke, Phoenix, and Gilbert, Nissen & Irvin, Beverly Hills, Cal., for appellant.

Carl D. Hammond, Kingman, Albert M. Dreyer, Las Vegas, Neb., and Evans, Kitchel & Jenckes, Phoenix, Denison Kitchel, Morton M. Scult, and Otis D. Sullivan, Phoenix, of counsel, for appellee.

UDALL, Justice.

This is an appeal from a judgment of the superior court of Mohave county granting appellee $15,000 compensatory and $35,000 punitive damages. The complaint named appellant Sheet Metal Workers International Association and three foreign corporations as defendants. None of the three corporations was served with summons or complaint and none appeared in the action.

Appellee has alleged and attempted to prove a conspiracy to enter into an oral agreement to deprive him of his employment by effecting and enforcing a compulsory union contract in violation of Arizona Constitution, Art. XXV, A.R.S., as implemented by A.R.S. § 23-1302 (the socalled 'right-to-work' provision). Both the Constitution and statute read as follows:

'No person shall be denied the opportunity to obtain or retain employment because of nonmembership in a labor organization, nor shall the state or any subdivision thereof, or any corporation, individual, or association of any kind enter into an agreement, written or oral, which excludes a person from employment or continuation of employment because of nonmembership in a labor organization.'

Page 206

The allegations of the complaint if proved admittedly show a violation of subsections 8(a)(3) and 8(b)(2) of the Labor Management Relations Act (29 U.S.C.A. § 141 et seq.) and that the defendants are subject to the jurisdiction of the National Labor Relations Board by virtue of their doing business affecting interestate commerce within the standards set by the federal statute.

[89 Ariz. 189] The appellee filed an unfair labor practice charge with the regional director of the National Labor Relations Board who refused to issue a complaint for lack of sufficient evidence. It seems to be undisputed that the failure to issue a complaint was for a lack of evidence of a violation of the federal act rather than for lack of evidence of sufficient effect on interstate commerce to warrant NLRB action. The effect of the latter probably would permit state jurisdiction under L.M.R.A. § 14(c) as amended 1959.

We are met at the outset of this appeal with the contention that the superior court did not have jurisdiction to hear this case. It is true, as a general rule, that where (as in this case) the allegations if proved would show a clear violation of §§ 8(a)(3) and 8(b)(2) of the L.M.R.A. by defendants whose businesses unquestionably affect interstate commerce as defined by the L.M.R.A., the United States Supreme Court has held that exclusive jurisdiction vests in the NLRB and that the state and federal courts are ousted from jurisdiction even though the same acts may constitute a violation of state law and give rise to a cause of action in a state court. This rule arises because Congress has expressed its judgment in favor of uniformity where the labor disputes affect interstate commerce. Guss v. Utah Labor Relations Board, 353 U.S. 1, 77 S.Ct. 598, 609, 1 L.Ed.2d 601.

However, some exceptions permitting concurrent jurisdiction seem to remain. See e. g., L.M.R.A. § 10(a); United Const. Workers, etc. v. Laburnum Const. Corp., 347 U.S. 656, 74 S.Ct. 833, 98 L.Ed. 1025; International Union, United Auto., Aircraft and Agr. Implement Workers of America (UAW-CIO) v. Russell, 356 U.S. 634, 78 S.Ct. 932, 2 L.Ed.2d 1030; International Ass'n of Machinists v. Gonzales, 356 U.S. 617, 78 S.Ct. 923, 2 L.Ed.2d 1018. Appellee urges that one such exception covers the facts alleged in this case; that is, acts constituting violations of both the L.M.R.A. and state regulation of union security agreements. Appellee relies primarily on the authority of L.M.R.A. § 14(b) as construed in Algoma Plywood & Veneer Co. v. Wisconsin Employment Relations Board, 336 U.S. 301, 69 S.Ct. 584, 93 L.Ed. 691.

The language of subsection 14(b) fairly suggests that appellee is correct:

'Nothing in this subchapter shall be construed as authorizing the execution or application of agreements requiring membership in a labor organization as a condition of employment in any State or Territory in which such execution or application is prohibited by State or Territorial law.'

[89 Ariz. 190] It seems clear to us that the interpretation given § 14(b) by the Supreme Court in Algoma fixes its meaning at a scope broad enough fully to encompass appellee's interpretation of that section. The facts of that case were essentially identical with those alleged in this case. The employee in that case was discharged pursuant to a compulsory union agreement. The issue before the court was federal preemption. The Court held that the State of Wisconsin properly could grant damage relief for a discharge made pursuant to a contract which violated Wisconsin union security laws despite the fact that a federal agency had validly compelled the defendant to make the objectionable contract. The Court indicated that Congress had granted permission to 'the States by § 14(b) of the Taft-Hartley Act to carry out policies inconsistent with the Taft-Hartley Act itself.' Algoma Plywood

Page 207

& Veneer Co. v. Wisconsin Employment Relations Board, supra at 336 U.S. 315, 69 S.Ct. 592.

The opinion of the Court in Algoma made quite clear that the federal act did not merely adopt by reference the state regulation of union security agreements. The Court said at 336 U.S. 313-314, 69 S.Ct. 591:

'Other provisions of the Taft-Hartley Act make it even clearer than the National Labor Relations Act [Wagner Act] that the States are left free to pursue their own more restrictive policies in the matter of union-security agreements. Because § 8(3) of the new Act forbids the closed shop and strictly regulates the conditions under which a union-shop agreement may be entered, § 14(b) ...


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