Waterhouse v. Comer

55 F. 149 | U.S. Circuit Court for the Southern District of Georgia | 1893

SPEEB, District Judge.

Cases are frequent where persons intrusted with corporate properties have applied to the courts for the prevention or redress of grievances threatened or inflicted by labor organizations. This is the first instance of which we have any information where members of such an association have by concerted action, in an orderly way, sought the arbitrament of a court to adjust a controversy relative to the wages and conditions of their employment. The recent application to this court of the Order of Bailway Telegraphers, with similar purpose, was an attempt of this character. It was defeated in limine. The telegraphers, as a body, had abandoned the service of the receiver before they presented their petition. In the mean time, other telegraphers, with equal right to employment by the receiver, had bean engaged, and were performing the functions the striking telegraphers had surrendered, and, notwithstanding the solicitude of the court to spare a large number of intelligent young men ihe distress resulting from their indiscreet action, it was found to be impracticable. The members of¹ the Brotherhood of Locomotive Engineers, who have presented this petition, have a proper standing in court. There are 250 locomotive engineers in the employment of the receiver, upon the various divisions of the Central Balitead ¿k Banking Company of Georgia» Of these 211 are members of the Brotherhood of Locomotive Engineers, and the petitioners are a commit tee from that membership. They recite in their petition the facts that they have been for several years working under contracts made between a general committee of the brotherhood and the officers of the railroad. Since the 1st day oí 1 December, 1893, they have been working under the contract, of which, they attach a copy, and since that time the properties have been intrusted to the control of Hugh M. Comer, as the receiver of the court This contract expired on the 1st day of December, 1892. A few days prior to that time they gave notice to George D. Wadley, general superintendent of the company, that they desired certain changes in the contract. They state further that they have remained in the servlet-* of the company, although. Hie superintendent and receiver refused to enter into any new contract or consider the old contract longer in force, unless ordered so to do by the court.

Pending the adjustment of the controversy, which was postponed for 90 days by virtue of a clause of the contract, which entitled the receiver to notice for that period, and of which lie claimed the benefit, the court has continued the contract in force.

We have also caused several conferences between the receiver and the engineers, with the hope that an amicable agreement might follow. This expectation has been defeated by a strike on the ftavannah, Americas & Montgomery Bailmid, the refusal of one of the engineers to haul a train to which a car of that company was attached, his immediate discharge, and the friction between the receiver and the engineers which resulted therefrom. The engineers then applied to the court. They set forth the object;; o£ their order, the advantages of a contract with their employers, and that such contracts are of force upon a very large proportion of the principal railroads of the country. They state that since it has been shown to them that the properties in the hands of the receiver are embarrassed financially, they are content to work in Ms service without any increase of wages, although they insist that the rate is less than that paid by competing and connecting lines, and they pray that the receiver be directed to continue in force the contract under which they were working at the time the receiver was appointed, subject to such, modifications and changes as may be made by the order of the court. They annex a, copy of this contract.

The receiver answers: First. That the Grand 'National Brotherhood of Locomotive Engineers is not incorporated, and that many of its rules and regulations, which have a bearing upon any contract its members might make, are withheld from th'e public. This places him at a disadvantage, and renders uncertain the attitude of the brotherhood in any difficulty which might arise in connection with the contract. Second. That a number of the locomotive engineers employed by him are not members of the brotherhood, and that it is not proper for him to contract in this way with certain employes, while others are employed without such a contract. Third. That such a contract renders it impossible for the officers charged with the operation of the property to have such freedom in its administration as is necessary to its prompt and efficient management. Fourth. As a common carrier, the railroad under his control is liable for damages which may result from the disorganization of its service. That the Brotherhood of Locomotive Engineers is bound by secret obligations to withdraw from the service of railroad companies in a body, causing great damage. Fifth. That he should be at full liberty to select the best men and means of managing the business, without regard to organizations of any kind. That his superintendent has prepared a proper schedule of wages and conditions for the employment of engineers and firemen, a copy of which is attached. Sixth. If he should contract with the brotherhood, it would be holding out a premium for his employes to become members of that order, which respondent states is not to the interest of his trust. That the brotherhood renders it impossible for the officers of the railroad to come into direct contact with the employes, and. prevents such free intercourse as is necessary to good and efficient service. That no contracts have been entered into with the Order of Railway Conductors and the Brotherhood of Locomotive Firemen, and that he has had no difficulty with the conductors and firemen. He denies that it is usual and customary for railroad companies of the United States to make such contracts with the Brotherhood of Locomotive Engineers.

It will be observed that much of the receiver’s answer is an argument against the propriety and policy of contracts of any character between the officers of railway corporations and the representatives of labor organizations. The gravity and importance of the considerations thus presented are exceedingly great. The control, under any circumstances, by the courts, of contracts between representatives of the immense values invested with corporations engaged in the public duty of transportation, and the laborers employed in the same service, will doubtless appear to many as novel and dangerous. It is well, however, to consider if a proper provision, by appeal to the courts, in the frequent and destructive conflicts between organized capital and organized labor will not afford the simplest, most satisfactory and effective method for the settlement of such controversies. Is it not the only method by which the public, and, indeed, the parties themselves, can be protected from the inevitable hardship and loss which all must endure from the frequently recurring strikes?

It will not be wise for those engaged with the maintenance of public order to ignore the immensity of the changes in the relations of the employing and the employed classes, occasioned by the phe'hoiiienal development of commerce and the prevalence of labor organizations. We are in this ease directly concerned with a corporation and a labor organization, and both engaged in railway transportation; and in this department of industry it is reported by the interstate commerce commission that there is invented, in the United Unites $9,829,475,015, or nearly eight times the entire national debt of the country. 'Last year the railroads transported 530,000,000 passengers, or more than eight times the entire population of the United" States. The operatives employed by them number 784,000, and it is no trilling twfimony to the faithfulness and efficiency of fats mighty army of railroad employes that of the vast population 'transported under their care only 293, or less than one twenty-thousandth of 1 per cent, lost their lives. It is, moreover, true that no operatives of a. railroad more than locomotivo engineers are charged with the preservation of life and property, anti when we -ire advised by the proof that 82,0(10 of the locomotive engineers o? ,:Iie TJMíed Otates, more than 80 per cent,, belong; to the brotherhood, It is difficult to believe that their membership lessens efficiency to employers or fidelity to their supreme duty to ihe public, lb it

whether these fasts and other facts equally significant will justify judicial control of contracts essential to the Truinterropted transportation of the country, in which the public is so vitally concerned, it is clear that where the property of railway or other corporations is being administered by a receiver, under the superintending -power of a court of equity, it Is competent for a court to adjust difficulties between the receiver and his employes, which, in the absence of such adjustment, would tend, to injure the property and to defeat hie purpose; of the receivership. Indeed, the power of Ihe court to direct a contract between Its officers does not appear to be qoesboned. Tiie power of the court has always, on proper occasions, beau exercised to protect the properties from the damaging and unlawful re;suits of a. stUhe of the laborers in its employ.

In the case of The Telegraphers v. Corner,¹ (decided at this term,) while ¡’Ms court, as above stated, was prevented by their own conduct from according to the petitioners the practical relief they sought, they were enjoined from any interference with the property, 'operations, or employes of the receiver, and rules were issued against Individuals, who were charged with such iuierfcivace. In Re Higgins, 27 Fed. Rep. 444, the learned circuit judge of this circuit, the Honorable Bon A. Pardee, declared:

"It is well-settled law flint whoever willfully iuierfereo with property in s-ie possess ¡ion oí' a court is guilty of a coni erupt, of that court, and 1 regard it as equally well settled that, whoever uni awfully interferes with officers and monís oí the court, in ilie full and completo possession and management of uñe properly in the custody of the couri, is guilty of a contempt o£ court, and If is immaterial whether (Ms unlawful interference comes in the way of actual Bulo-nce or by ini imilla (ion and thvenlo. The employes of the receiver, eliliongii pro hae vice officers of the court, may quit their employment, as can employes of private parties or corporations, provided they do not ihereby inlorttionally disable the property; but they must quit peaceably and decently. Where they combine and conspire to quit, with or without notice, with the object and intent of crippling the property or its operation, I have no doubt that they thereby commit a contempt; and all those who combine and conspire with employes to thus quit, or, as officials of labor organizations, issue printed orders to quit, or to strike, with an intent to embarrass the court in administering the property, render themselves liable for contempt of court.”

Certainly, it follows, then, that it is in the power of the court, in the interest of public order, and for the protection of the property under its control, to direct a suitable arrangement witb its employes or officers, to provide compensation and conditions of their employment, and to avoid, if possible, an interruption of their.labor and duty, which will be disastrous to the trust and injurious to the public. There is no reason why the receivership, in this rpspect, should be conducted in a manner differing from the large preponderance of the successful and prosperous railroads of the country. It appears from the proof that about 90 per cent, of the railroads of the United States make contracts or schedules of rates and regulations for the employment of their operatives, which are agreed to by the representatives of both parties. We are satisfied from these facts that such arrangements, under proper restrictions, are praiseworthy and beneficial to both parties, and we therefore shall not longer hesitate to direct the receiver to enter into an appropriate contract or schedule of rates and regulations with the engineers. This contract, however, will not be restricted to members of the Brotherhood of Locomotive Engineers, although membership of that order is and will be no disqualification to service on railroads under the control of this court so long as the rules and regulations of the order are treated as subordinate to the law of the land. The contract will comprehend all engineers employed by the receiver, whether members or nonmembers of tbe brotherhood.

This brings us to the consideration — First, what is an appropriate contract; and, second, whether there is anything in the rules and regulations of the brotherhood and its relations to these properties which is inconsistent with the law, and which would make it improper for the court to place its receiver in a position where, in Ms exigent duty to carry on the business of transportation, for which the railroad was chartered by the state, he may find himself in the power of an orgamzed body of his operatives who will be able to paralyze the operations of the properties. The appropriateness of the contract depends solely upon the arrangement of details. There is no difference between the engineers and the receiver upon the question of compensation. There is an apparent dispute about the effect of seniority of service of an engineer as affecting promotion. The court will provide, however, that, where merit and ability are equal, seniority of service shall prevail, and will arrange a fair tribunal for the purpose of testing the merit and ability of various candidates for promotion, with the privilege of either party in cases not reconcilable to appeal to the court. There are other instances of minor disagreement which the court will take time to adjust and to perfect the agreement.

We have noted with gratification the repeated statements made in judicio by the engineers and their counsel that they will accept na final and satisfactory of every difference the conclusion and decision of the court. The receiver lias also expressed more than once tils purpose to abide the' decision. This submission, so unlike the violent and irrational course pursued by either party, as their interests might, prompt, and without the slightest regard to the rights of the public, in many conflicts between what are popularly called “'capital and labor,"’ is considerate, judicious, and strongly argues that the engineers who are before the court are good citizens, —indeed, patriots who rer-poet and confide in the constituted authorities of their country. Fortunate will it be for our country if future differences of a similar character may be settled by a method so simple and so safe. This submission of the engineers applies as well to the remaining and most important difference between the parties, and that is the effect upon the duty to the court and to the property of the rale of the brotherhood, which is understood by the court to be as follows:

“(12) That Itereniter when an ¡teme ha a been sustained by the .grand chief end eerried into (Acht,, >.»v Ote Brotherhood of Locomotive i'ii.’giitwuw ft shall be recognized at; a violation of the obligations if a member of tiia Brotherhood oí i.ocomotive Engineers who may be eiuxhoyed on a railroad run in connection with or adjacent to raid road to huidlo lho properly belonging to said railroad or system in any way that may benefit said company with which the Brotherhood of LoromoUve Engineers are at issue, until the grievances or issues of difference of any nature or Mud have boon amicably settled.”

Tbis rule is understood So have been adopted by the brotherhood in Denver three years ago. In his testimony, Mi*. A. B. Youngson, the assistant chief engineer, frankly admitted that the effect of this rule, as applied to the properties In the hands of the receiver and the engineers in Ms employ, would be as follows: O’, In the pursuance of the business of a common carrier, with which the receiver la charged, it should become necessary to convey over the linea of the Central Railroad a car belonging to a. railroad company on which there was a strike of the engineers, that it would be the duty of the brotherhood men in the employ of the receiver to refuse to haul the train containing suck ear, and, If the officers of the road Insisted iliar the car should proceed, loyalty to the brotherhood required 'that the engineer should at once resign Ms: station, and abandon his duty. He might, he stated, if he thought proper, carry the train to the terminal point.

An illustration of the effect of Oils, rule is afforded by the evidence. A strike was recently pending on the Savannah, Ainerieus & TdontgomejyRailroad, wMch vans in connection with ami is adjacent to the Central. Engineer Arden of the Brotherhood of Locomotive Engineers, In the employ of the receiver, was directed to carry a ear of the Bavannak, Americuc A Montgomery road between two stations on the Central ¡Railroad. He declined to do so, and was at once discharged. A committee of the brotherhood have insisted on his reinstatement. This the receiver has refused, and it is certain that but for the pendency of the proceedings now under consideration by the court, there would be, sis si result of Engineer A Men’s construetion of Ms duty, and the receiver’s action, a strike of the engineers upon every line of the Central, with all the calamitous results to the public, to the road, and to the engineers which would inevitably ensue. The receiver relies upon this as the main and controlling reason why he should not he required to enter into a contract with the brotherhood, when this rule 12 will necessarily be written into the contract. Mow, there can be not a doubt that this rule of the brotherhood is in direct and positive violation of the laws of the land, and no court, state or federal, could hesitate for a moment so to declare it.

It is plainly a rule or agreement in restraint of trade or commerce. Section 1 of the act of July 2, 1890, known as the “Sherman AntiTrust Law,” provides:

“Every contract, combination in the form of trust or otherwise, or conspiracy in restraint of. trade or commerce among the several states, or with foreign, nations, is hereby declared to be illegal. Every person who shaE make any such contract or engage in any such combination or conspiracy shaE be deemed guilty of a misdemeanor, and, on conviction thereof, shall be punished by a fine not exceeding $5,000, or by imprisonment not exceeding one yeai, or by both said punishments, in the discretion of the court.”

Section 7 of the act of February 4, 1887, entitled “An act to regulate commerce,” provides—

“That it shall be unlawful for any common carrier, subject to the provisions of this act, to enter into any combination, contract, or agreement, expressed or implied, to prevent, by change of time schedule, carriage in different cars, or by other means or devices, the carriage of freights from being continuous from the place of shipment to the place of destination; and no break of bulk, stoppage, or interruption made by such common carrier shall prevent the carriage of freights from being, and being treated as, one continuous carriage from the place of shipment to the place of destination, unless such break, stoppage, or interruption was made in good faith for some necessary purpose, and without any intent to avoid or unnecessarily interrupt such continuous carriage, or to evade any of the provisions of this act.”

Section 8 of the same provides—

“That in case any common carrier subject to the provisions of this act shall do, cause to be done, or permit to be done any act, matter, or thing in this act prohibited or declared to be unlawful, or shaE omit to do any act, matter, or tiling in this act required to be done, such common carrier shaE be Eable to the person or persons injured thereby for the fuE amount of damages sustained in consequence of any such violation of the provisions of this act, together with a reasonable counsel or attorney’s fee, to be fixed by the court in every case of recovery, which attorney’s fee shaE be taxed and collected as a part of the costs in the case.”

This is. the interstate commerce law, and, as amended by -the act of congress of March 2,1889, provides:

“Sec. 3. (a) Undue Preference. That it shall be unlawful for any common carrier, subject to the provisions of this act, to make or give any undue or unreasonable preference or advantage to any particular person, company, firm, corporation or locality, or any particular description of traffic in any respect whatsoever, or to subject any particular person, company, firm, corporation, or locahty, or any particular description of traffic, to any undue or unreasonable prejudice or disadvantage in any respect whatsoever, (b) Facilities for Interchange of Traffic. Every common carrier subject to the provisions of this act shall, according to their respective powers, afford aE reasonable, proper, and equal facilities for the interchange of traffic between their respective lines, and for the receiving, forwarding, and deEvering of passengers and property to and from their several lines and those connecting therewith,. and shall not discriminate in their ratos and charges between such connecting lilies; hut this shall not be construed as requiring any such common carrier to give the use oí its tracks or terminal facilities to another carrier engaged in like business.”

“See. 10. Penalties for Violation of the Act. That any common carrier, subject to the provisions of the act, or, whenever such common carrier is a corporation, any director or officer thereof, or any receiver, trustee, lessee, agent, or person acting for or employed by such corporation, who alone or with any other corporation, company, person, or party, shall willfully do or cause to be done, or shall willingly suffer or permit to be done, any act, matter or, thing in this act prohibited or declared to be unlawful, or who shall aid or abet therein, or who shall willfully omit or fail to do any act, matter, or thing in this act required to be done, or shall cause or willfully suffer or. permit any act, matter, or thing so directed or required by this act to be done, not. to be so done, or shall aid or abet any such omission or failure, ox’ shall be guilty of any infraction of. this act, or shall aid or abet therei/i, shall be deemed guilty of a misdemeanor, and shall, upon conviction thereof in any district court of the United States within the jurisdiction of which such offense was committed, be subject to a fine of not to exceed $5,000 for each offense: provided tlisri, if the offense for which any leveou shall be convicted as aforesaid shall be an unlawful discrimination in rates, fares, or charges for the transportation of passengers or property, such person shall, in addition to the fine hereinbefore provided for, be liable to 'imprisonment in the penitentiary for a term of not exceeding two years, or both such fine and imprisonment, in the discretion of the court.”

The laws of the United States (section 5440 of the Revised Statutes) provide:

“If two or more persons conspire either to commit any offense against the United States or to defraud the United States in any maimer or for any purpose, and one or more of such parties do any act to effect the object ox conspiracy, all the parties to such conspiracy shall be liable to a penalty of not less than one thousand dollars, and not more than ten thousand dollars, and to imprisonment not more than two years.”

Construing these several enactments together, it will be seen that a combination of persons, without regard to their occupation, which will have the effect to defeat the provisions of the interstate commerce law inhibiting discriminations in the transportation of freight and passengers, and further to restrain the trade and commerce of the' country, will be obnoxious to severe penalties. This will apply with even greater force to persons in the employ of the railroads concerned.

Bow, it is true that in any conceivable strike upon the transportation lines of this country, whether main lines or branch roads, there win be interference with and restraint of interstate or foreign commerce. This will be true also of strikes upon telegraph linea, for the exchange of telegraphic messages between people of different states in interstate commerce. In the presence of these statutes, which we have recited, and. in view of the intimate interchange of commodities between people of several states of the Union, it will be practically impossible hereafter for a body of men to combine to hinder and delay the work of the transportation company without becoming amenable to the provisions of these statutes. And a combination or agreement of railroad officials or other representative of capital, with the same effect, will be equally under the ban of the penal statutes. It follows, therefore, that a strike, or “boycott ,” as it is popularly called, if it was ever effective, can be so no longer. Organized labor, when injustice has been done or threatened to its membership, will find its useful and valuable mission in presenting to the courts of the country a strong and resolute protest and a petition for redress against unlawful trusts and combinations which would do unlawful wrong to it. Its membership need not doubt that their counsel will be heard, nor that speedy and exact justice will he administered wherever the courts have jurisdiction. It will follow, therefore, that in all such controversies it will he competent, as we have done in this case, for the courts to preserve the rights of the operatives, to spare them hardship, and at the same time to spare to the public the unmerited hardship which it has suffered from such conflicts in the past. It will be also found that by such methods organized labor will he spared much of the antagonism it now encounters, and in its appeal to the courts it will have the sympathy of thousands, where, in its strikes, it has their opposition and resentment.

But, if there were no statutory enactments upon the subject, no court of equity could justifiably direct its receiver to enter into a contract with a body of men who hold themselves bound to repudiate their contract, and disregard a grave public duty, because of real or alleged grievances, which some other person or corporation, not a party to the contract, inflicts or is alleged to inflict, not upon a party to the contract, but upon somebody else. To compel the receiver to do this would be monstrous. The receiver may be wholly just, considerate, humane, and even indulgent, to the engineers in his employ. They may, with reason, regard him not only as their kindly employer, but as their friend. The people of Georgia may have afforded to them every needed evidence of sympathy; the compensation may be ample; their future as bright as possible for intelligent, energetic, and courageous manhood; and yet, because of a difficulty with or without cause which originates in Maine or Minnesota, they will abandon the service of their kind employer, and forego the realization of their own hopeful anticipations, and bring dismay, and it may be ruin, upon the kindly and sympathetic people among whom they live. This is almost the inevitable consequence of this rule. It is in evidence, and is generally known, that almost the entire business of transportation of freight is carried on in cars which, without breaking the bulk of their freight, are forwarded from one railroad to another. This is an absolute necessity. The interests of the public and the economies of cheap and rapid transit demand it. There are 1,200,000 cars upon the railroads of the United States. There are 168,400 miles of railroad, or more than seven cars per mile.

The Central Railroad, according to the recent report of the superintendent, has less than two cars per mile. It is therefore indispensable that it should use the cars of other lines; but, if it were otherwise, it would he impossible, under the present system, to deny to the cars and freight of other lines transit over the lines of the Central without violation of the law. The receiver cannot violate the law, and the engineers cannot compel him to do so without themselves becoming obnoxious to the criminal statutes. And the court does not doubt, from their bearing and testimony in the case, that they only need to be advised of these facts, when they will immediately recede from the unlawful and most dangerous attitude In which this rule has placed them. It is, indeed, a rule which, more than all others, has given strength and comfort to the enemies of organized labor.

It is true, however, that the learned counsel for the petitioners, when his attention had been called by the court to the insuperable difficulty in the way of a. mutually beneficial contract presented by this rule, while insisting that it ought not to stand in the way of a contract, hastened to afford additional evidence of the good faith of his clients, by stating unreservedly that upon this, as upon all subjects, they were willing and anxious to take the direction of the court. This declaration is authoritative, and the court will act upon it. It is binding upon the engineers of the brotherhood, who are <Jilceir. of the receiver, and who were represented by ihe commit!ee and their assistant chief engineer, Mr. Youngson, all of whom wore lit the presence of the court when it was made. It is accepted as math in good faith, and as a condition of tint contract which I be court will direct the receiver to make. While, therefore, any engiitoíB* may, at any time, exercise his right sis an individual to leave the services of the receiver, he may not do so in such manner as to injure the properties ox* impede Its proper management

In. case of any issue with the management in which the brotherhood or its members are concerned, and the members in the employ of the receiver shall desire to leave his services, in a body or otherwise, in such manner as may in any way impede the opera!ions of the road, they will be required to do so upon such terms and conditions as to the court may seem proper for the protection of the interest of the property and the maintenance of justice and fair play to all concerned. In the mean time the old contract will remain m force, always under the general operation of this decision with vofemee to rule 12 of the brotherhood, untD. the terms of the new contract are definitely settled by the court; and it will bo specially directed that no engineer or other person in the employ of the Central Railroad shall be discharged or in any way injured in Ms station on account of this proceeding, oi* any step taken in regard to its inception or advocacy.

1 Not reported, as the present ease is control ling on the questions in issue.

Case Details

Case Name: Waterhouse v. Comer

Court Name: U.S. Circuit Court for the Southern District of Georgia

Date Published: Apr 8, 1893

Citation: 55 F. 149