United Steelworkers of America v. Warrior & Gulf Navigation Company

PETITIONER:United Steelworkers of America
RESPONDENT:Warrior & Gulf Navigation Company
LOCATION:Superior Court of Bibb County

DOCKET NO.: 443
DECIDED BY: Warren Court (1958-1962)
LOWER COURT: United States Court of Appeals for the Fifth Circuit

CITATION: 363 US 574 (1960)
ARGUED: Apr 27, 1960
DECIDED: Jun 20, 1960

Facts of the case

Question

Audio Transcription for Oral Argument – April 27, 1960 in United Steelworkers of America v. Warrior & Gulf Navigation Company

Earl Warren:

Number 443, United Steelworkers of America versus Warrior & Gulf Navigation Company.

Mr. Feller you may proceed.

David E. Feller:

Mr. Chief Justice and may it please the Court.

This is a little more difficult case than the one which we have just been through, a little more difficult.

And the difficulty is two-fold.

One is in the nature of the grievance.

Now, this is the kind of grievance which — that seems to raise hackles among management people, arbitrators, creates more confusion than I think any other single type of grievance.

And also the — there is some language in the arbitration agreement which does not appear in the usual or standard form of arbitration.

We think that for the same reasons which we set forward in the first case, the American Manufacturing, the Court should come to the result here.

But it will take us a little more time I think to dispose of these difficulties.

Now, to the facts, in this case, there was a contract, again, executed in 1956.

The Company is the Warrior & Gulf Navigation Company which operates a barge line.

It’s a wholly owned subsidiary of United States Steel.

It has a terminal at Chickasaw, Alabama.

The unit involved and this is important as it bears on the grievance, the nature of the grievance, was not a production unit in the usual manufacturing established but a maintenance unit.

This was a unit and the contract covered people whose job was to repair these barges as they came into the terminal from time to time.

In 1958, the union filed a grievance essentially claiming that what the Company was doing was having its repair work done instead of at its own terminal.

At other terminals nearby, contracting out, it’s the word it used, to work to other employers.

And that this violated the agreement constituted, they said “a partial lockout,” it was the word of the grievance, because there were people who were laid off by Warrior & Gulf who did this kind of work, who could do this kind of work and who had in fact done this kind of work until the Company selected to have someone else do the work instead of — of the employees of the collective bargaining unit.

The employer of the Company refused to arbitrate the grievance and a lawsuit was filed asking that the grievance be arbitrated.

Let me say a word about the grievance because this applies to both cases and indeed in all cases.

I will not treat the grievance the actual language of grievance as defining the scope of the contract claim.

Now, the Court of Appeals, even the dissenting judge treated it that way.

Grievances in the nature as being appalled by a workman not by staff representative the union usually, that work.

They’re certainly aren’t to be construed with the strictness which under the federal rules even the complaints drafted by lawyers no longer are treated.

And there’s no provision for amendment.

And grievance really is just the starting paper which starts it off, the claims are defined and refined as the grievance procedure goes along.

In any case they filed a grievance saying that the Company had violated the agreement by contracting out this work.

The Company refused to arbitrate and it went to the Court.

In it’s defense, in the —

Felix Frankfurter:

May — may I ask you before you state the defense.

What, if you read the exact scope of the arbitration undertaking, what it is that was —

David E. Feller:

Well, it’s a —

Felix Frankfurter:

— remitted the arbitration or commented the arbitration?

David E. Feller:

All right.

I will give you — in the — in the contract, I suppose the best place to find it — well, on page 12 of our combined brief, it set out the essential part it set out.

The —

Felix Frankfurter:

Where is it?

Is it too long to read?

David E. Feller:

Well, I’ll read it.

Felix Frankfurter:

That is a subject matter of (Voice overlap) —

David E. Feller:

(Voice Overlap) it — it kind of reads backwards and I — I will invert the — the order in which it appears and we’ll start at the beginning in attempt — point of time and it’s the second quoted paragraph.

“Should differences arise between the Company and the Union or its members employed by the Company as to the meaning and application of the provisions of this Agreement, or should any local trouble of any kind arise, there shall be no suspension of work on account of such differences but an earnest effort shall be made to settle such differences immediately in the following manner.”

And then you go through the grievance procedure with the ascending steps, all arbitration at the end.

But before all that is the following introductory paragraph which is one of the two difficulties in the case.

“Issues which conflict with any Federal statute in its application as established by Court procedure or matters which are strictly a function of management shall not be subject to arbitration under this section.”

And what we have in these contract is a larger than usual grievance and arbitration specification which covers both questions of meaning and application and any local trouble of any kind in addition plus a limitation saying in the words which I’ve quoted which at least insofar as relevant here, appears, at least in our view and all I anticipate by argument, to limit the arbitrator to questions of what we think are questions of meaning and application of the agreement.

But this is one of the issues in the case as the proper construction of that language.

Felix Frankfurter:

There is, the arbitration with — that the agreement would force an arbitration, matters which are strictly a function of management help.

David E. Feller:

That is correct.

Felix Frankfurter:

And needless to say grievance, a difference of opinion may arise as to what are matters strictly for the — for the management.

David E. Feller:

Well, there are — obviously, there are such differences and the question is under this language, “Who resolves those differences?”

Felix Frankfurter:

Yes.

I’m —

David E. Feller:

And more importantly — now I think we would say, and again I’m anticipating here, that I might as well get this clearly out as really the essential part of this argument.

Every grievance and I think it is most important to recognize, every grievance claimed against action which is taken by management as a matter of a function of management.

Management under this contract as a management rights clause, some contracts do, some contracts don’t, it doesn’t make really much difference.

Management hires, fires, pays the people, directs the working force and schedules the workers.

That’s the management’s function.

It’s not only its rights, its — its obligation, it’s its duty.

David E. Feller:

A management obviously has the right lay off employees.

The only question in every grievance is whether a management which should always be active in exercising its function of directing the working forces, scheduling the employees, paying them has in doing that violated some provision expressed or implied in the agreement.

If it lays off A instead of B, the argument which a grievant — A says, “I shouldn’t have been laid off, B should have been laid off.”

Obviously, management is exercising its function of managing in laying off a man.

As a matter of fact, in picking the one to be laid off in first place, that’s management’s job.

It makes the determination.

It reads the contract.

It determines what it’s going to do.

In the nature of the grievance procedure, this consultative system ending up in arbitration is that you then determine whether a management which acted the first place, acted in accordance with the other provisions of the agreement in exercising management’s function.

Now, we read this provision which says that you don’t arbitrate things which are strictly a function of management as meaning strictly, i.e. purely a function of management.

Felix Frankfurter:

Meaning not covered by any other provision of the agreement.

David E. Feller:

In which there is no claim that there is anything covered in the other provision of the agreement.

It comes down to in the end very much at — and it’s necessary because you have a broader grievance procedure which allows grievances on any local trouble whether or not related to the agreement to be handled in the grievance procedure.

This is not a limited grievance procedure.

You can file a grievance which says, “We don’t think the Company ought to install this new machinery.”

And under this grievance procedure that must be processed if there’s trouble about that.

We don’t claim that you don’t have any contract right to do it but we’ll just then will think you ought to.

Or we think that Joe Jones is the foreman.

He’s a mean and nasty man.

We think the Company ought to fire Joe Jones as the foreman.

And there’s problem about Joe Jones.

Under this agreement, that is the local trouble and you go through the grievance procedure.

This is the finding of fact in the United States Steel contract which I gave Your Honor.

We permit that up to a certain stage of the grievance, any complaint.

We defined there grievance as a — a complaint of violation in the agreement but complaints are much broader than that.

Now, having given that broader scope to the grievance procedure, covering matters which relate to the agreement, right of claims of violation in the agreement, the parties had to, we assume in the hypothetical intent which we always do here as you do when you interpret legislation, find out what they meant in this first paragraph.

And when they say that a matter which strictly a function of management is a matter in which management — there’s no claim that management’s rights are limited by the agreement.

In the Joe Jones case, I don’t claim that management has got a — employ a foreman who’s pleasant to the workers.

In the (Inaudible) case, I talked about in the previous case.

There are lots of grievances like that and they say, “Now, those matters are strictly a function of management.”

Charles E. Whittaker:

Do you think the facts are in (Inaudible)

David E. Feller:

I think that is our position, Your Honor.

Precisely our position is that this arbitration provision just like the one in American Manufacturing, though differently phrased, intends to limit the arbitrator to the determination of questions of interpretation and application of the agreement, whether or not the Company has violated the agreement.

And when you raise a question like that, you are not in the areas which are strictly a function of management.

You are in the areas in which there is dispute as to whether management’s rights are not limited — whether management rights are limited.

Now, it could be argued abstractly as a matter of language that when you say with this kind of a clause, the Court before it orders arbitration has to decide whether management’s rights are limited or are not limited in the way he claimed.

The Court needs to decide that.

The fellow that is it proves too much because then every grievance must be decided by the Court.

Because then every grievance involves — every grievance involves a management function and a claim that management has violated some rules expressly or impliedly contained in the agreement limiting the way in which it performs its functions or prescribing a particular way in which it shall perform its functions.

Felix Frankfurter:

What is involved is a conflict of view unless it’s ludicrous — what it involves is a conflict of view whether there are provisions in the agreement that has been — that limit the strict view or confinement because it’s dealt within the come provisions explicitly or implicitly in the agreement.

David E. Feller:

That’s what — that’s what every grievance says.

A — a question of whether management’s right in this area or to do what he did management always does.

Potter Stewart:

Well, that’s — that’s true of every grievance as to the application of the contract.

It’s not purely the kind of grievance that — the other kind of grievance you’ve bee talking about —

David E. Feller:

No.

Those, I — I —

Potter Stewart:

— the unpleasant from of —

David E. Feller:

— when I — I say every grievance I mean grievance and I should — I’ve — accustomed to speaking in U.S. — to your language.

I’m talking —

Potter Stewart:

It’s not true.

David E. Feller:

— of grievance —

Potter Stewart:

In other words —

David E. Feller:

— as the complaint of violation of the agreement.

Potter Stewart:

It’s not true, in other words —

David E. Feller:

It’s not true in every complaint where the —

Potter Stewart:

It’s not through the local trouble kind of grievance?

David E. Feller:

No.

That’s right.

It’s not true of that.

And the purpose of this paragraph, we believe, was to inartistically and unfortunately labor agreements are often drawn inartistically to limit the effect of the following language, the prior language.

David E. Feller:

As a matter of fact, it’s a very curious thing and I’ll advert to it right here.

Well, I plan to do it later.

There is a case, Timken Roller Bearing Company versus N.L.R.B in the Sixth Circuit involving the contracting out of work among some other things.

It was decided in 1947.

In which that case arose in this fashion and this is how arbitrability can be decided the other way around.

The company contracted out some work and the union called a strike.

While the strike was in progress, the company refused to meet with the union and the National Labor Relations Board issued unfair labor practice charges and found the company guilty of a violation of the duty to bargain.

And the question came up to the Sixth Circuit on the question of enforcement of that order.

And the Court held that the question of contracting out was arbitrable.

And since it was arbitrable, the companies had no duty to bargain on that question with the union because it had channeled the bargaining as it were into the grievance procedure.

There, the employer was arguing the contracting out was arbitrable but the peculiar thing is that that contract — and if Your Honor will look at page 12 in the sense beginning, “Should differences arise between the Company and the Union.”

And I will read from the — the grievance procedure in the Timken Roller Bearing case which said, “Should differences arise between the Company and the Union”, and I’m reading from 161 F.2d 951, “as to the meaning and application of the provisions of this agreement or should any local trouble of any kind arise in the plant, there shall be no suspension of work on account of such differences but an earnest effort shall be made to — to the settle such differences properly in the matter here and after outlined.”

And that agreement said and that’s the broad thing that covers what I call grievances technically, claims of that and complaints.

The agreement also provided, though the Court doesn’t quote it, “Limited arbitration to grievances or disputes involving the interpretation or application of the contract.”

And that contract in our belief is substantially the same as this.

The Sixth Circuit held there it was arbitrable, not in the claim of the union to arbitrate but (Voice Overlap) —

Earl Warren:

What was that case again Mr. —

David E. Feller:

That is Timpken Roller Bearing Company v. N.L.R.B, 161 F.2d 949 we cited it in our brief though.

Felix Frankfurter:

And why was it arbitrable?

David E. Feller:

Because it involved, I said, the Court a question of the scope of management’s rights as compared with the rights of the employees.

That’s a very general language to that.

And this is something which was committed to the arbitration procedure.

The Board argued it was not arbitrable.

The National Labor Relations Board argument was not arbitrable, therefore, the Company had a duty to bargain with the union.

Felix Frankfurter:

Well, I should — I should think of large percentages of the controversies for which there is a procedure to peaceful settlement, arises precisely on the question whether or not it’s a matter of exclusive concern to the management or not.

David E. Feller:

Mr. —

Felix Frankfurter:

I should suppose those are almost the majority.

Well —

David E. Feller:

They’re about —

Felix Frankfurter:

— there is a good many large percentages —

David E. Feller:

I —

Felix Frankfurter:

— to settle for that.

David E. Feller:

I think this is correct that a large percentage of grievances involved areas in which management says, “Well, we’re not restricted by the contract at all.”

And the union argues that there is an obligation implicit in the agreement.

Now, this is that kind of a grievance.

There is nothing in language in this agreement, I want to make it clear, about contracting out of work.

Nothing which expressly limits the Company’s right to do it or in fact expressly gives the Company the right to do it.

Charles E. Whittaker:

(Inaudible)

David E. Feller:

We had sought and I want to get to that and that’s —

Charles E. Whittaker:

(Inaudible)

David E. Feller:

All right.

I will — I will do it right here.

In 1956 negotiations, before this contract was executed, the union and the contracting out problem has been a problem with the Steel workers Union for years, sought a clause which would have forbidden the Company to contract out any work unless the union agreed.

They sought that cause and United States Steel didn’t get it and they sought it here and didn’t get it.

Now, the fact that the Company’s — the union sought such a clause was relied on both in the District Court and In the Court of Appeals to argue that the grievance here was not arbitrable.

I want to make several points in connection with that.

First of all, I think unlike contract interpretation where proposals which parties make to each other commercial contracts may be relevant and there’s no damage done to the process by bringing in proposals.

Actually, many arbitrators will refuse to hear proposals which the parties have made with others for a very good reason.

If parties know that when they make a proposal to deal explicitly with the subject which they think or may have an argument has already dealt with the contract.

And that was a proposal — will be used in the arbitration process thereafter.

You place a large rulebook in the — in the conduct of successful collective bargaining.

Each party is playing it very close to the bets, it can’t be frank and say what it wants because if it is frank, it’s going to get cut in an arbitration proceeding.

For that reason, most arbitrators, many arbitrators will take with great deal of reluctance evidence as to proposals.

As a matter fact, in the agreement, for the first time in the agreement just concluded in the basic steel industry because there were such a public cure about the local working conditions issue, the work rules dispute this, specifically provided what we have always done in practice that neither party shall make any reference to any proposals which the other party had made during the course of the negotiations.

But that’s an arbitrator not a court.

Now, if we assume that the Court is in the position of an arbitrator, an assumption which I’m willing to make.

But if you assume it is and as — because I think the course of negotiations, if it does come in before the arbitrator, bears on the question of the proper interpretation and application of the agreement.

You would construe the agreement in the light of the proposals which the parties had made to each other.

If you want to construe it in those terms and if you want to get in on that basis, my answer to the District Court’s and the Court of Appeals’ reliance on the 1956 proposals of this — what the union proposed in 1956 was a bar on all contracting out of work.

In this grievance, I think it ought to be made perfectly clear in this case.

David E. Feller:

We do not contend that the contracting out of work is not a management function.

We do not contend that management does not have the right to contract out of work.

As soon as they get confused with absolutes, we say management has a right to contract out work.

Charles E. Whittaker:

Without violating this contract?

David E. Feller:

Without violating this contract so long as it uses that right in a way which doesn’t violate some other provision in the agreement just as it has the right to lay off people.

Of course it has the right to lay off people but it has an obligation to use its right to lay off, to schedule, to assign and to contract out work in a way — has an obligation to do it or not to do it in a way which impinges on some other obligations which it has assumed in the contract.

There are some very good arbitration decisions involving just this question and of course people get in their absolutes.

The Company says, “The union is trying to stop us from contracting out all work.”

The union says — I know in one — are contracting out case in basic steel has said, “What if they can contract this work out, they contract out the operation of a blast furnace.”

I mean let’s take a hypothetical which factually used in the steel arbitration case.

The union said, well, if they do this, you what they can do?

We’ve got a contract covering the open heart of a blast furnace.

They can just get some contractor and say, “Now, you come in and operate our blast furnace for us and do it for us for a price,” and the contractor come in a wage where it’s half of those of the people who had been working.

And essentially, what they have done is destroyed the collective bargaining unit and actually destroyed the contract by simply hiring somebody to come in and supply labor at lower rates.

And we said, “Well, therefore, no contracting out can be permitted going from extreme to extreme.

The Company said on the other hand obviously, sometimes we make — miss materials, sometimes we — in our own plant sometimes for reasons of economies, it’s desirable as first to buy materials.

That’s contracting out, sometimes we have certain work done in the plant for reasons, practical business reasons, it’s important for us for having done off the plant.

Therefore, we must have the right to contract out in all circumstances.

Well, what the arbitrator said in a really very careful decision is, and let me use the words of Ralph Seward who was one of the most distinguished labor arbitrators.

“The Company has and always has had a broad general right to contact with other companies for the furnishing of goods and services.”

This is quoted on page 64 of our brief.

“There is also no question that it may not properly abuse that right, that it may not exercise it in such a way as to frustrate the basic purposes of the agreement or make the agreement impossible to perform.”

The implied obligations issued as it posed in this case, is not whether the Company may contract all of its work or none of its work.

It is whether there was any implied contractual bar to the contracting out of this particular work at this particular plant and under the circumstances of this particular case.

Now, when you claim as we claimed here that the Company violated the agreement, we are claiming that by contracting out this work at this particular plant or terminal and under the circumstances of this case, the Company violated its implied obligations under the contract.

(Voice Overlap) —

Felix Frankfurter:

Will you be good — will you be good enough to read if you can the terms in which the grievance was formulated which was asked to go to arbitration in this case and then read the terms of the proposal which you made or a provision in the contract which — which failed?

David E. Feller:

Well, the grievance is found on page 104 of the record.

Felix Frankfurter:

Wait a minute.

104?

David E. Feller:

Yes.

Felix Frankfurter:

All right.

David E. Feller:

And paragraph 3 of the Court’s — District Court’s findings.

“We are hereby protesting the Company’s actions arbitrarily and unreasonably contracting out work to other concern that could and previously has been performed by Company employees.

This practice becomes unreasonable and unjust and be discriminatory in lieu of the fact, but I say these are not drawn by lawyers — in lieu of the fact — I think it means in light of it of the fact that at present, there are a number of employees who have been laid off for about one and one-half years or more for alledgedly lack of work.

Confronted with these facts, we charge the Company is in violation of the contract by inducing a partial lockout of a number the employees who would otherwise be working were it not for this unfair practice.”

Felix Frankfurter:

Is the lockout explicitly prohibited in the (Voice Overlap) —

David E. Feller:

If lockout is explicitly prohibited by the agreement.

Felix Frankfurter:

Now, read — now if you will read what was proposed to the Company to be incorporated in the agreement and rejected?

David E. Feller:

Well, that unfortunately does not appear on the record, Your Honor but I can direct Your Honor’s attention to the place within the transcript to which it’s referred to and described.

Felix Frankfurter:

The transcript in the — below?

David E. Feller:

Of — of the transcript to the hearing in the District Court.

Felix Frankfurter:

Well then, that’s here and you may —

David E. Feller:

Yes.

Well, I will on page 83 of the record.

Felix Frankfurter:

You mean down — the stenographic or this one?

David E. Feller:

In this one.

Felix Frankfurter:

All right.

David E. Feller:

The hearing before the District Court.

This was — case, I never got around to saying this case had a full hearing.

Felix Frankfurter:

Yes, all right.

David E. Feller:

The Company in its defense offered really defenses which went to the merits of the grievance which we regard this whole question of the 1956 negotiation as going to the merits of the grievance.

The District Court refused to strike an answer so we have to go and put our case here.

Felix Frankfurter:

Yes.

David E. Feller:

And now, the witness in this case is Mr. McElroy who was a witness for the — for the employer, Mr. Lang and I think can tell you who is — what his function is.

And at the bottom of page 83, the answer to the long thick paragraph right below the last question.

“I don’t recall that these specific words were read or said at the negotiation.

I do recall that the issue of contracting out work was brought up.

I don’t recall that it had anything to do with any mutual agreement.

I think that the request was that the Company quit contracting out work period.

David E. Feller:

Then if you turn — if Your Honor will turn over to page 96 of the record, and here, we have a union representative testifying.

And at the beginning —

Earl Warren:

The first one was the Company representative.

David E. Feller:

That was the Company representative —

Earl Warren:

Yes.

David E. Feller:

— in the negotiation, and this is now a union representative.

And in answer to the judge’s question beginning at folio, where it’s marked Folio 141 about one-third down.

“Let’s get down to the question of what happened in this instance.

Well, we take the proposal of the United Steel Workers and proposed to the Company in trying to protect these employees that we try to limit this contracting out of work to the extent that we mutually again agree on contracting out.

Was that the general proposal made by the United Steel Workers to the United States Steel Corporation and to all other major steel companies?”

“Yes, sir.”

Now, this is all there is from the record.

I can assure you, the Court, because I participated in drafting that proposal in 1956.

That what it said is, “The Company shall not contract out any work previously performed by bargaining unit employees except by mutual agreement.”

There was flat ban on contracting out.

The difference in the testimony here is the Company said it was a flat ban and the union said, “Well, if it was by a mutual agreement, you could contract work out.”

Felix Frankfurter:

And —

David E. Feller:

Now, the testimony follows in explanation and is asked, “Did we agree with the Company that the Company had the unrestricted right to contract out work in those negotiations?”

“Never.”

“Did we ever claim that the contract restricted the Company from contracting out emergency repair work?”

“No.”

The contract out work — it could not have been done.

Actually, the proposal on 1956 was as usual proposal made for bargaining purposes, was far beyond anything in — I’ve so many reasonable employer would undertake.

We finally settle in saying we’ll have to live with the kind of arrangement we have under which under the arbitration decisions in U.S. Steel, and this just was a carbon copy, the arbitrators have held as I’ve said that the question is, the Company has the right to contract out the question as whether it exercises that right in a way which involves the violation of some other provisions of the agreement abusing its right to contract out.

Now, that I’ve already dealt with the number one difficulty which is the contracting out and I feel that I’ve dealt also with the number two difficulty that is, the clause in this contract.

Let me say what the District Court and Court of Appeals did.

The District Court tried the grievance as I said and it found that on this contract, it interpreted this contract as giving the Company the unrestricted right to contract out work.

William J. Brennan, Jr.:

Now, may I ask Mr. Feller.

I gather under what you said to us earlier, namely that the determination whether a submission is an arbitrable submission, is something that the Court under 301 may inquire into and decide.

David E. Feller:

That’s right.

William J. Brennan, Jr.:

This first paragraph, the introductory paragraph was properly before — was properly before the District Court —

David E. Feller:

That is correct.

William J. Brennan, Jr.:

— with the interpretation.

David E. Feller:

We — we believe this paragraph, not the — not the question of the management clause as to contracting out.

And that question is before the District Court for interpretation as we view it.

Now, I will say that, we are taking a much more modified position than some people who say that.

Since you commit all questions of interpretation to the arbitrator, he should also be given at least in the first instance, the right to construe the provisions governing arbitration.

We take the position that as I think we must in all candors that we have to come in and prove there’s a violation of a promise.

And in order for a court to determine there’s a violation of promise, we have to say the promise was to arbitrate, the promise has not been complied with.

William J. Brennan, Jr.:

Now, is it true that the position that in this instance in taking the testimony that what you did in considering the factors that he did that —

David E. Feller:

We are —

William J. Brennan, Jr.:

— the judge overstepped?

David E. Feller:

Oh, he — he went into the question of contracting out.

When I say there’s a question for the Court, the question for the Court is not contracting out in this case or whether Mr. Sparks was able to work in the American Manufacturing case.

He can take testimony if testimony is relevant as to what the parties meant by the arbitration clause.

That’s what he’s interpreting not the management’s rights clause, not the clause having to do with seniority or discharges or any other clause.

He is construing the arbitration provision.

This distinction we were not able to persuade the District Court, existed because he said, and I think this is — this bears directly on your question, Mr. Justice Brennan.

We pointed out to him that should any local trouble of any kind arise.

And he said, and he saw that.

He says I don’t see how that prevents the company from contracting out work.

Well, of course, it doesn’t prevent the company from contracting out work.

But —

William J. Brennan, Jr.:

Well, I — did this history of the contracting out clause, was that relevant to an interpretation on the first paragraph of that (Voice Overlap) —

David E. Feller:

We do not think so.

William J. Brennan, Jr.:

In other words, it’s not relevant to a determination whether the grievance submitted involves strictly a function of any.

David E. Feller:

No.

The — as we read that clause, that determination is to be made on the basis of whether the — the union is claiming to interfere with something which it says is a strictly a function of management, the Joe Jones case, or is claiming that the — the company has violated some other provisions, other than the management rights clause.

William J. Brennan, Jr.:

Well, now suppose however, the — or what would your position be had the history of the contracting out clause been introduced for the purpose of establishing that the parties expressly considered strictly a function of management, that language of the arbitration clause when they were debating the contracting out clause?

David E. Feller:

Well, that’s a — in other words, if the evidence were introduced as evidence going to the proper meaning of strictly a function of management.

William J. Brennan, Jr.:

In relation specifically to contracting out.

David E. Feller:

Well, that you might argue then that that evidence would be relevant as an aid in the construction of the terms “strictly a function of management.”

Well, of course this —

William J. Brennan, Jr.:

But the way it came in —

David E. Feller:

— clause has been in here all the time.

William J. Brennan, Jr.:

But the way, as I understand your position then, the evidence dealing with contracting out was submitted and relied upon here.

It was not offered for that limited purpose of the interpretation in the arbitration clause.

David E. Feller:

Well, at least, it was not made the findings which I’d direct Your Honor’s attention to which appear at particularly on page 105 on the record.

Felix Frankfurter:

Justice Brennan’s question would arise more — more concretely if the grievance to which you call our attention on page 104 had been explicitly opened to be inserted in the agreement and reject it.

David E. Feller:

In the arbitration clause, we’ve said that all questions of contracting out —

Felix Frankfurter:

No.

I don’t mean that.

I mean if instead of what you — evidence to which you refer that there was a general desire or desire for a general clause against contracting out for the period or by mutual agreement.

You said that that is different from what is claimed here.

You make no such claim here.

David E. Feller:

That’s right.

Felix Frankfurter:

You make a claim here that to the extent that they exercise this contracting out in this case is a way of violating the no lock-out provision.

David E. Feller:

No lock-out provision —

Felix Frankfurter:

Now, what I’m saying is —

David E. Feller:

I won’t — I don’t limit myself to the no lock-out (Voice Overlap) —

Felix Frankfurter:

In other words, some other — any from — you referred to explicit provision and say this is a way of defeating those explicit provisions and not —

David E. Feller:

That’s correct, Your Honor.

Felix Frankfurter:

— don’t affect with their lock out.

Now, —

David E. Feller:

(Voice Overlap) —

Felix Frankfurter:

— what is I’m saying is, suppose there had been an explicit — the question that my Brother Brennan put would arise.

I’m not saying what its relevance but it would arise if — if there had been a proposal for a provision exactly in those terms.

The company shall not contract out with a view to — thereby indirectly violating any provisions of this contract.

David E. Feller:

I would say that that agreement was not admissible that —

Felix Frankfurter:

All I’m saying is that —

David E. Feller:

— that this would not be admissible and irrelevant.

Felix Frankfurter:

That isn’t my question.

My question was, well if that wouldn’t concretely raise the question, here you say that the proposal doesn’t square with your grievance.

David E. Feller:

That’s right, Your Honor.

That would be admissible evidence subject in the — in the arbitration proceeding.

Felix Frankfurter:

I’m saying that’s a different case from this.

David E. Feller:

Oh, this.

That is a different case from this.

But even in that case, it’s none of the District Court’s business because the District Court is not construing the management rights clause, it’s construing the grievance and arbitration clause.

Felix Frankfurter:

Well, you’re saying the antecedent torts of proposal in a collective bargaining negotiation in with each side, is making proposals for this, that and the other reasons.

But for so reasons for the assertion of power reasons that satisfied respective constituents etcetera, etcetera, though they’re not irrelevant to determining what the scope of the arbitration agreement is.

David E. Feller:

Well, I’d go further.

I say those ought not to be irrelevant in determining the proper interpretation of the substantive provisions of the contract.

Felix Frankfurter:

Well, that — that isn’t before us.

That’s for the arbitrators.

David E. Feller:

That’s for the arbitrators.

(Voice Overlap) And a fortiori, they are not irrelevant even if they were good evidence.

What you’ve argued — the items Your Honor mentioned go to its competency really.

I say it’s incompetent and further, I say here, it’s irrelevant because you have to decide in this substance.

Felix Frankfurter:

Whether it’s incompetent, is the argument you have to make before the arbitrator —

David E. Feller:

That’s right.

Felix Frankfurter:

— and not before us.

David E. Feller:

Here, we say it’s irrelevant because nobody has asked this judge to find what he did, i.e. the contracting out as an inherent right of management which the union cannot claim, is limited by the agreement.

Charles E. Whittaker:

Isn’t this true, Mr. Feller, that this District Judge is confronted with a necessity to determine what is arbitrable or whether this claim is arbitrable?

And that is a matter if intention of the parties, isn’t it?

David E. Feller:

That right.

Charles E. Whittaker:

Now —

David E. Feller:

Somewhat hypothetically but still a —

Charles E. Whittaker:

Yes.

David E. Feller:

I think —

Charles E. Whittaker:

But does not the fact that the union sought and the — it and the employer bargained about including in the contract a covenant fact, no work would be contracted out but that this covenant was rejected, shed light upon the intention of the parties as to whether they intended such to be arbitrated?

David E. Feller:

No, Your Honor.

They intended it — said, shed light on what the parties intended the substantive rule should be.

This is like the legislative history of a statute, Your Honor.

When you have a question as to whether a federal question is raised in a case, the evidences in the legislative history of the federal statute sought to be construed is not relevant on the question of whether there’s jurisdiction.

The question is if you weigh a claim and you say; I claim a right under this statute.

Now, it may very well be that the legislative history will show that your claim is very bad, that the proposed right that you think the statute gives you, Congress fairly considered and rejected and didn’t include in the statute.

And you might say — and therefore, really on the merits and if the statute is going to be construed against you when all the legislative history of that statute is relevant there, but you don’t make a motion to dismiss on the ground that there’s no federal question before the Court on the basis of the result you expect the Court to come out to on the substantive question.

And that’s precisely the question — the kind of question here.

If you’re construing an — paragraph in the Judicial Code, if could find out where the Court has contended to be — give jurisdiction, then the legislative history of the Judicial Code is relevant.

Charles E. Whittaker:

Yes.

Now isn’t that what this is?

David E. Feller:

No, this is not legislative history of the Judicial Code, this is legislative history on the substantive issue of whether management should contract out and how much and under what circumstances.

William J. Brennan, Jr.:

Well let me see if I get — if I get your position correctly, Mr. Feller.

In effect what you’re saying is this, that the extent of which under 301, it sought to have arbitration order.

The extent to which the Court may make any inquiry is to determine the meaning of the arbitration clause only.

David E. Feller:

That is — that is right.

William J. Brennan, Jr.:

And that any evidence the Court may receive, extrinsic evidence that bears upon the meaning to be given the arbitration clause may be received.

But necessarily, it has to be evidence which the parties, evidence of what the parties said and did and the exchanges they may have made and so forth in relation to that clause alone.

David E. Feller:

That is correct.

William J. Brennan, Jr.:

Is that it?

David E. Feller:

That’s right.

William J. Brennan, Jr.:

And that here when get into the evidence dealing with contracting out practices, they — that was not evidence which bore upon what the parties meant when they wrote this arbitration clause.

David E. Feller:

That is precisely correct, Your Honor.

As a matter of fact the — the distinction we want to make is emphasized by the fact that they have just concluded another collective bargaining agreement down here which the subject of contracting out was again raised.

And what do you think?

The company proposed that the contract provide the Company shall have the right to contract out work.

And that didn’t get in the contract either.

Now, the arbitration clause means the same thing irrespective of that evidence as to what they proposed in 1959 or 1960 negotiations of what we proposed is 1956 negotiation.

That evidence we can argue about the meaning of that proposal.

David E. Feller:

When we get before the arbitrator, we argue the extent to which the company is bound or is not bound not to contract out under these circumstances.

Potter Stewart:

Mr. Feller, you told us that — that what is crucial as the meaning of the arbitration clause.

David E. Feller:

That’s right.

Potter Stewart:

And if this is a matter under which the District Court can and must rightfully go.

I’m — perhaps you’ve explained it but it’s not clear to me what — what the — what this arbitration clause means in this case.

And I’m thinking now of the case of — of the local trouble of any kind.

The — that’s something clearly not covered by the terms of the agreement.

For example the —

David E. Feller:

Well, that was —

Potter Stewart:

For example the — the particular shift doesn’t like their foreman because he —

David E. Feller:

I think –-

Potter Stewart:

— they think he’s —

David E. Feller:

— I think that —

Potter Stewart:

— (Voice Overlap) has an unpleasant personality.

Now —

David E. Feller:

I —

Potter Stewart:

— is that arbitrable or not?

David E. Feller:

I should think not.

And I think not because of the virtue.

I think that is the intention of the language matters which are strictly a function of management, shall not be subjected to arbitration.

I think that’s subject to the grievance procedure.

Charles E. Whittaker:

(Inaudible)

David E. Feller:

Well, now.

That’s — is the critical point in the case, Your Honor.

We said that it is not strictly a function of management.

The only way you construe that to make sense is that the Court has to look.

As Mr. Justice Stewart says, if this grievance says, “We don’t like Joe Jones, the shift foreman and there is no claim that the employment of Joe Jones, it violates any obligation under the contract, then that case is one which involves strictly a function of management and is not arbitrable.

William J. Brennan, Jr.:

It’s not in the proceeding?

David E. Feller:

Now, if the union claims —

William J. Brennan, Jr.:

But it’s subject to the three or four steps as to what —

David E. Feller:

Up to arbitration.

William J. Brennan, Jr.:

Up to arbitration.

David E. Feller:

But if the union claims that there is any obligation under the agreement for some reason not to have Joe Jones as the foreman or not the contract out, then that claim does not present a question which is strictly a function of management and that claim can go to the arbitrator, and the arbitrator is not to be at large.

He is to decide only the extent to which management rights are limited in this circumstance.

That is the only way which I think this clause can be construed without making every grievance a subject to the Court thing and I think it’s clearly wasn’t intended that that be done.

No more than I think that it was intended here because it would — that that’s an unusual kind of agreement.

Charles E. Whittaker:

(Inaudible) foreman’s own jurisdiction?

David E. Feller:

No, Your Honor.

It makes the — the arbitrator the final authority on whatever management rights are restricted with respect to contracting out if that’s the issue or scheduling of work or anything else and that is what the agreement intends him to be.

And that’s the only thing, he’s the final decision.

William J. Brennan, Jr.:

Mr. Feller, I’m sure that the — this is relevant here but as — an instance to the clarity in expression in a collective bargaining agreement.

David E. Feller:

And if you will note —

William J. Brennan, Jr.:

What its issues which conflict with any federal statute in its applications established by purposes —

David E. Feller:

I am puzzled over that, Your Honor.

I did not participate in these negotiations.

I don’t think any lawyer did for the union.

I suggest that you ask Mr. Lang who I think did participate.

I haven’t the slightest idea what that means.

I’ve been prepared to make that guess when it becomes relevant in the case.

William J. Brennan, Jr.:

Well, I think it’s irrelevant here.

I just (Voice Overlap) —

David E. Feller:

No, I don’t think anybody relies on that language.

It’s as we’ve said, the law — well, it’s hardly a matter of — of draftsmanship but I think it does serve to illustrate the point that you can’t read these things as if they were corporate trust or deeds.

These things are — are collective bargaining instruments and you have to look to the institution, the nature of the instrument in construing this to give effect to the intent of the parties.

And I think that the — this construction which we made of this is strictly a function of management clause, is one which make sense in terms of the context to this contract and the only one that make sense.

Yes, Your Honor.

Felix Frankfurter:

As you know, I always bristle or — and (Inaudible) when people talk about the intent of the parties unless they mean that which has been compounded and formulated into the words of the doctrine.

David E. Feller:

That is precisely what I mean.

Felix Frankfurter:

And all talk about intention let’s loose a lot of hairs.

David E. Feller:

That’s right.

David E. Feller:

And —

Felix Frankfurter:

And I think also you ought to have been, what shall I say, should have agreed to a considerable extent to adjust the import of Justice Whittaker’s question as to how much under your claim is necessarily left to the arbitrator not to determine his jurisdiction, that’s another mischievous word in this connection, but how much of the wording of the system is dependent upon the arbitral skilled worker.

David E. Feller:

Oh, I — I’ve misunderstood the question if — if you thought I must answer.

I have no doubt, this I would state as an article of faith on the question of the whole process as because I participated in the process.

That this process works best when there are no judges around.

And I say that with all due respect to the — to the courts.

It is important and essential to this process that the matters which the parties agree should be left to arbitration — should be left to arbitration.

And in the guise of deciding the arbitrator’s jurisdiction, the Court should not as they did here actually decide what are — what management’s rights to contract out, how are those limited?

What is the law of contracting out in the law of the collective bargaining?

The incredible thing is and I think this is out.

There is a very good decision by G. Allan Dash, who was just recently, the President of the National Academy of Arbitrators, just this last term.

He wrote a decision in some of these corporations and it’s cited in our brief which reviews every reported contracting out grievance or almost everyone at least.

It’s — it’s cited on our briefs at pages 58 to 59.

And he reviewed them, I think as an arbitrator, he did not charge the parties for all the time he spent in research on that decision, at least I hope he did.

But he analyzed 64 cases classified in one way or the other.

Most of them held no violation to the agreement but not one arbitrator found that the question was not arbitrable, though in 10 cases, it was argued.

They found the questions are arbitrable and they decided against the grievance.

And I think that it’s easy to say, “Well, arbitrators always want business.”

But I don’t think that in connection with people like Dash and — and Garrett and Seward and the people who’ve decided this cases.

Their problem isn’t that they want business, they have too much business.

There — it is completely far, the nature of the grievance procedure of this administrative machinery, that the courts in the lieu of — in — in lieu, I’m using the language of the grievance.

That’s right.

David E. Feller:

In the guise of deciding questions of arbitrability, consider evidence and decide the questions on the merits.

And let me add one word that is important.

This kind of question of which — incidentally, the First Circuit of Judge Magruder, I think has gone off base.

Judge Magruder says that you have to determine whether there is a — it would go along with the — all the way except he says it is up to the Court to determine whether there is any provision, substantive provision in the contract which deals with this matter.

And Professor Cox in his recent article of Harvard Law Review says that he agrees with their view of it except Judge Magruder always comes to the wrong result in every case.

I think that when you understand, and this is a distinction which Judge Magruder has not made, which Professor Cox has not made.

When you have a contract with an absolute no-strike clause, an absolute no-strike clause, then it is not fair to say there is an area which is governed by the contract and there is an area which is ungoverned by the contract.

And when you say questions of interpretation and application of the agreement, the Court has to determine whether this is an area governed by the contract or ungoverned by the contract because it’s possible to do that in a limited arbitration clause which incidentally, most of Judge Magruder’s cases were.

David E. Feller:

Well, he doesn’t advert to the fact if you read it very carefully, if a grievance was not arbitrable, it was strikable.

William J. Brennan, Jr.:

It was what?

David E. Feller:

Strikable.

In other words, if in one case, the question whether there’s seniority clause, they transfer a man to the night shift.

He says under the seniority clause, I’m entitled to stand to day shift.

William J. Brennan, Jr.:

I thought it was the lobster shift.

David E. Feller:

Well, that was the Boston Herald Traveler.

That was the — the lobster shift.

I don’t know what’s the lobster shift is [Laughs] but the local 201 —

Potter Stewart:

(Voice Overlap)

David E. Feller:

(Voice Overlap) case, it was the night shift.

He says, “I have to construe this contract to see if there is any provision governing the transfer of shift, i.e. whether the seniority clause governs.”

Our view — and that’s a question for the arbitrator, of that itself is a question of interpretation and application.

But his cases are easy for him because if he says, “No, nothing in this contract governs changes in shift,” then the union say, “Well, very well, we’ll strike you on this, that’s reserved to you and we reserve our rights too, we strike.”

A very different case as in this case.

Well, the contract says there’s — it’s an absolute no-strike clause, not limited to an arbitrable grievance.

Now, when you hold the grievance isn’t arbitrable, you don’t say it’s not governed by this contract.

It’s governed by this contract alright.

It’s governed by this contract because this contract, you then read as giving management the right to do what it does without later hindrance by the — the union without the right to strike, without the right to complain, without the right to be consulted.

All of rights it would have, absent this agreement.

Charles E. Whittaker:

Well then, that means I take it in your view that every dispute is arbitrable under this contract.

David E. Feller:

Well, Your Honor.

Again, every dispute which makes a claim —

William J. Brennan, Jr.:

That’s right.

David E. Feller:

— that it is — that there is a question arising under the agreement.

There are disputes when you say, “Look, the wages in here, only 3$ an hour and none of the $3.50, and I file a complaint.

That’s not arbitrable because I’m not claiming under the agreement.

I’m claiming something in fairness, injustice, and equity.”

And I will say that in that sense, the — the employers come in agreement that says $3 and that’s it.

If I claim that under the agreement we have under this thing, its express terms and its implicit terms and there’s much that has to be implied in this kind of — much, much that has to be implied.

Potter Stewart:

Would you go so far as to say in your wage case that if — if an employee says “This $3 really means $3.50,” and that would be —

David E. Feller:

I think he’s got a —

Potter Stewart:

– arbitrable?

David E. Feller:

He’s got a non-arbitrable grievance.

Potter Stewart:

That is —

David E. Feller:

(Voice Overlap)

Potter Stewart:

— that it would be arbitrable if it’s according to this —

David E. Feller:

He’s got an arbitrable grievance if he’s going to lose.

Now, the arbitrator can’t say, “Well, really the contract says $3 and it means $3 but you want to have $3.5.

I think he’d be —

Potter Stewart:

No —

David E. Feller:

— exceeding his jurisdiction.

Potter Stewart:

I’m not talking about — you’ve quoted me your — your position —

David E. Feller:

That’s — that’s my — my — reporting out pay case since morning where the contract said he gets four hours and he says “Well, I think four means six.”

Potter Stewart:

And the Court therefore would be without power to the decline to specifically enforce an arbitration.

David E. Feller:

And — and Judge Magruder would agree on that.

The First Circuit would agree.

He says once in a — out of vacation case, the New Bedford Defense Products case which I think the question was, the contract says you have to be on the payroll in June to be at vacation.

This goes that I was in the contact in March.

And he said that was arbitrable because he could find whether there was a contract, a time specified in the contract, therefore, the contract governed it and it wasn’t his concern, not whether the grievance was a good one or not.

Felix Frankfurter:

But Judge Magruder has had an experience as he — on those which is not on private knowledge because he has referred to it in an article.

He has had experience in which this Court has overruled him on what he thought was a perfectly untenable position.

David E. Feller:

(Voice Overlap) —

Felix Frankfurter:

Well, is that a fact about it?

And — but he said it’s conceivable that this Court could have been right and he’s wrong in that particular situation.

And he’s a very modest man.

And so as Judge Magruder in effect as I find that his opinion is that he ruled out that the arbitrator might find significance with an agreement that he has not discovered.

David E. Feller:

That’s right, Your Honor.

And as a matter of fact, your comments, when you refer to the publication are not in — in a periodic one.

They’re in the decisions on arbitrability from which he expresses his own view in reversing Judge Wyzanski on the arbitrability question.

David E. Feller:

It was inconceivable to him that this Court could have sustained Judge Wyzanski’s position on whether you could bring suit under 301.

Felix Frankfurter:

Well, this — this Court has had members — has members who are — who are constantly learning that things they didn’t see seemed to be as clear as possible to a majority.

Potter Stewart:

Or that not that it’s inconceivable.

David E. Feller:

I’d like to reserve the remainder of my time for rebuttal if I may.

Earl Warren:

You may.

Mr. Lang.

Samuel Lang:

Mr. Chief Justice and may it please the Court.

I think it was in the decision of this Court in the Jones and Lachman case upholding the Wagner Act.

That it was said that it would be to ignore the plainest facts of our industrial life to hold that manufacturing was not an interstate commerce affecting interstate commerce or something to that effect.

And I would like to borrow that language to point to the situation in which the Company found itself in this case, the plainest facts of our industrial life in the negotiation of labor agreements, or that a union is striving to take and a company is striving to hold.

It’s important to recognize that in the situation which we have before the Court today.

What was the company striving to hold here?

For 18 years from its inception in 1940, it had exercised the practice of contracting out work.

During the last six years of that period up to the time of this controversy in 1958, it had contracts at least two, possibly several, record shows only two with this union.

In the course of which, it had continued this practice of contracting out work against the vigorous opposition of the union during the negotiation of those contracts and against the vigorous silence of the union during the operation of those contracts.

Now, the fact that the naked contract does not give us the right to contract our this work, only means that in the plainest facts of our industrial life, it is rare that a company can afford to take the years of shutdown due to strikes in order to obtain the negative provisions of a contract which be — would be necessary in order to change the language of this agreement.

The union asked for affirmative provisions and for negative provisions negatively.

The Company tries to keep out of the contract, things which will change its practices which have been accepted.

Everything that the union and the Company did, all of its objective conduct throughout the period involved here and in connection with the handling and administration of this arbitration agreement which is all we’re talking about here, this arbitration agreement, pointed to a pronounced acceptance by both sides of the fact that so far as contracting out work was concerned, it was an untouchable.

The union couldn’t touch it and the arbitrator couldn’t touch it.

Now, this is not a shipyard, about which we are talking here.

This is a transportation company.

The maintenance and repair of its vessels and barges is and always has been only incidental to its business up until the time that World War II took away its equipment and made it necessary that it reequip its operations.

It had the same type of skeleton force which it now has and to which it reverted after it had completed a special period of operations which due to the nature of the vessels which had been built under its own direction and engineering.

And due to the mistakes which had been made, calling for repowering and important changes, had called for a larger work force.

The record makes it clear that at no time during the 18 years including the six years in which the Company and the union had these contracts has there been any deviation from the practice.

The Company laid off employees before it had the contracts with the union while contracting out work.

William J. Brennan, Jr.:

What is the unit here, Mr. Lang?

Samuel Lang:

The unit is the — the maintenance employees, mechanics and helpers and also certain harbor tug employees.

It’s not confined to maintenance employees.

William J. Brennan, Jr.:

Are there are shop employees or some of them on board the vessels or —

Samuel Lang:

Some are aboard harbor tugs.

There are five contracts all told, three of them with the petitioner here.

This particular contract discovered the shop employees, the maintenance employees plus some fringe employees who are aboard tugs.

Felix Frankfurter:

What’s the size of the personnel?

Samuel Lang:

Relatively small, sir.

I think that at this time, probably in the neighborhood of 40 to 50 but that’s not in the record.

Now, in the execution of this maintenance work, as I said, it always has — and contracted out this work.

William J. Brennan, Jr.:

Is this the specialist concerns that you contract with?

Samuel Lang:

I beg you pardon, sir?

William J. Brennan, Jr.:

Did you contracted out the specialist concerns to mean —

Samuel Lang:

It’s contracted out to ship repair yards in the immediate vicinity.

William J. Brennan, Jr.:

They are express —

Samuel Lang:

They are expressly joining.

They are — they are shipyards exclusively, equipped to perform at a moment’s notice any and all types of ship repair work.

This yard was a small yard with very limited facilities and it had to give a certain amount of its business to the shipyards for the very practical reason in addition to the economy of not having to buy all its equipment for itself for the very practical reason that if it didn’t give a steady flow of work in his other shipyards, they wouldn’t do the work which they alone could do when the time came and there when needed.

Now, the practice as I say of contracting out continued unbroken and — and that the record shows conclusively in exactly the same fashion as it always had been done.

Moreover, both before and after the contracts with the union, the company laid off the employees while continuing to contract out work without complaint by the union.

In this particular case, it was almost two years after the grieving employees had been laid off, and after the last contract had been signed before the union or the employees filed its grievance.

So when the matter was presented to the Court, and the Court conceived as it did that it had the responsibility under Section 301 to determine whether this was an arbitrable issue.

Whether the parties had contracted to submit this issue to arbitration, and in that respect, I disagree with Mr. Feller in response to the question asked by Mr. Justice Brennan.

When the Court was asked to decide whether this issue violated the promise to arbitrate and it conceived its duty to decide that under Section 301, it decided it in the purest form of contract interpretation, one which has been recognized and accepted by our courts to this day and on a very broad and uniform basis.

Now, as this Court has had occasion from time to time to point out, and as Professor Cox on whom we all seem to be relying in this case.

William J. Brennan, Jr.:

We can find something he said that supports all of this.

Samuel Lang:

Well, in this case, sir, he supports us almost right down to the last teeth.

William J. Brennan, Jr.:

(Inaudible) supports —

Samuel Lang:

[Laughs]

William J. Brennan, Jr.:

— you with, Justice Frankfurter had him on one opinion, I had him on another.

Samuel Lang:

But this Court and Professor Cox both have said on occasion that the mere fact that this is a labor agreement, which we’re interpreting here, doesn’t mean that we have to abandon all the principles which we have followed in all these years in the interpretation of labor agreements.

Felix Frankfurter:

I hope we can all agree on that.

Felix Frankfurter:

I hope we can all agree on that that it must —

Samuel Lang:

Yes, sir.

Now frankly, the — the evidence in this case is overwhelming.

It’s overwhelming because — and I may be wrong again.

Up until a few month — a few minutes ago, I don’t think that Mr. Feller acknowledged what he did acknowledge at that time that it was for the arbitrator to decide arbitrability.

Now, nowhere in the record does it appear, or rather that be — it was for the Court to determine arbitrability, I’m sorry.

Nowhere does it appear explicitly in the record that the union took the position that it was for the arbitrator to decide arbitrability but I challenge anyone to read the brief filed in this case by the petitioner without reaching the conclusion that his argument is that only the arbitrator may determine arbitrability.

And the reason that that is clearly shown, the proof in the pudding is the fact that the union walked into the District Court, moved for summary judgment, sat down and did not make any attempt in this record, not one iota of attempt to prove what the parties had agreed to but instead tried to throw the smokescreen of the merit idea into the case by itself going into the merits.

Now, it is important that I distinguish at this point between the merits in the merits.

The merits that we are talking about and to which we address ourselves and on which the Court made its finding are these.

Number one, there’s nothing in the contact that prohibits subcontracting.

That’s an indication of something why, why isn’t there anything in the contract that doesn’t refer to contracting out.

Number two, because the parties have talked about it and decided and agreed that they shall not interfere with the Company’s right to contract out.

Number four, because there is great silence throughout the administration of these contracts when the Company exercises this practice of contracting out.

And number five, because management rights mean something here and I want to speak to that subject for a while too.

In other words, what we wanted to do when we went into the merits of the issue of the controversy was to show what the parties by their objective conduct had done and said, and themselves said they understood the contract to mean.

But when the union put on its case, it didn’t want to go into all that because it contended as it clearly does in its brief here that any claim makes the matter arbitrable.

Therefore, we don’t have to go into the question of whether or not the party has exhibited their intentions or understanding as to the contract.

They — instead of assuming the burden which I think I heard Mr. Feller admit that he had.

Instead of assuming the burden of proving to the Court’s satisfaction that this issue was arbitrable, it went into the merits of the grievance, the second kind of merits.

Now, what are those merits?

Those merits are, and here is all the testimony — oh exclusively the testimony of the — of the union that Joe Smith had done work on the bottoms at Warrior & Gulf’s yard and he also had done work on the bottoms at the Harrison Brothers yard, the company to which the company had contracted out some work.

And he could do work at the Warrior & Gulf yard which he also did at the Harrison Brothers Yard, and that a foreman who came around and — and laid out their work in the Warrior & Gulf yard also went around and marked with the yellow chalk the work to be done at the Harrison Brothers yard.

Therefore, what we were doing was, we were giving to Harrison Brothers work which these laid-off employees could do in our own yard.

Now, that is a horse of an entirely different color.

Those are the merits of the grievance.

Those are the things which the arbitrator will decide if Your Honors decide that this case shall go to arbitration.

We say the management rights clause means something.

Mr. Feller says it means nothing.

Mr Feller says you could leave that out of the contract and on this — and to this extent we agree with him because management always has the right to exercise management rights.

Samuel Lang:

He interprets that to mean that management has the right to fire a man.

And the union has the right to grieve about the firing of that man.

Management has the right to cut the hours of work and the union has the right to file a grievance about it.

But there’s one thing wrong with that idea.

This management rights clause contain the express provision that management’s rights shall be not arbitrable, not subject to arbitration.

Now, that must mean something.

That can’t merely mean that management having the right to fire a man, the union having a right to grieve that the fact of firing shall not be arbitrable but the justification for the firing shall not be — shall — shall be arbitrable where the fact of firing shall not be arbitrable but the justification for the firing shall be arbitrable.

You can’t mean that, it would be a waste of language.

And incidentally, Mr. Justice Brennan, I did not negotiate this contract either and —

William J. Brennan, Jr.:

Well, I’m — I’m —

Samuel Lang:

[Laughs]

William J. Brennan, Jr.:

— glad to know that.

I would have been embarrassed (Inaudible).

Samuel Lang:

I came to the case long after the contract was negotiated.

So we say that — that that language means something and that the Court had the right to construe it along with the rest of the language of the arbitration agreement.

We also think it is quite important to note the order in which these provisions appear in the contract.

The first thing that it said is, “Management rights shall not be arbitrable.”

And then it says “Differences and as to the meaning and application of the contract shall be arbitrable.”

Now, what does this mean?

What does this “management right shall not be arbitrable” mean?

I don’t think anyone will disagree that there has been a lot of confusion about the meaning of the term management rights.

That there has been a lot of difference of opinion between management people as to whether they ought to put a management rights provision into a contract or not to put one in a contract and the main area of disagreement is over whether the failure to cover everything means that they have thereby given up some things which they really had.

But uniformly, students, management and labor people agree that the management rights clause is there for the purpose of holding — holding on to the practices which they have.

We are reserving, retaining our rights in our practices.

And that is so well accepted in the philosophy of management people in any rate and we have cited the (Inaudible) in our brief to that effect and also some management — American Management Association and so on authorities to that respect.

That in seeking to put in language which again is inartistic, the reservation from arbitration of those practices in which they have been engaged, they sometimes get this provision which we report doesn’t have to get in our contract that those management rights shall not be arbitrable.

So —

Felix Frankfurter:

Mr. Lang, may I ask you a question at this point.

Samuel Lang:

Yes, sir.

Felix Frankfurter:

Put to one side for the moment the case that you have, namely where you place reliance on what were preexisting conditions determining or — or indicating what management rights are at this case?

Samuel Lang:

Yes, sir.

Felix Frankfurter:

Suppose you had no such antecedent arrangements, antecedent efforts to put something in on the part of union, resisted by the management and now — and in drawing the inference you do.

And the question comes up whether the claim of grievance of the union is arbitrable, if you resist on the ground that it was strictly a management right.

It comes before the Court, how does the District Judge, on what basis in a situation where you haven’t got raw materials — on what basis will he decide whether it is within or without strictly management rights?

Samuel Lang:

Sir, I would not give 10 cents —

Felix Frankfurter:

I don’t mean cover the universe —

Samuel Lang:

I would not give 10 cents for my chances in a case of that kind.

I — we — all we have to rely in this case upon the conduct, the objective conduct of the parties.We have to.

I think that if — that if our situation were — had absent the conditions which have been described and we have the naked contract here and nothing more that we wouldn’t have a chance before Your Honors.

Felix Frankfurter:

And the reason being that in order to determine what I might call a threshold jurisdictional question, he would have to decide the merits of what is or what is not strictly management, wouldn’t he?

Samuel Lang:

No, sir, not necessarily because I think in that case, you would have something more closer to the U.S. (Inaudible) case which is pending before Your Honors on application for certiorari where there was not any negotiation history and where there was actually a grievance filed in — in the prior history.

Where — where you have the naked contract in the management rights clause, I don’t think that we could rely upon the management rights clause to say that this is a reserved right of management which we have here if we did not have the history of the parties’ conduct because —

Felix Frankfurter:

Well, its — my question was that if you had that naked situation and if he did not allow it to go to arbitration, he would in effect, in fact, deciding the merits of what is a management, wouldn’t he?

What are management rights?

Samuel Lang:

Well, I think —

Felix Frankfurter:

Why do you say —

Samuel Lang:

— that that’s correct.

Felix Frankfurter:

Yes.

Samuel Lang:

I think that’s correct but for this reason —

Felix Frankfurter:

I’m not saying that it’s this case.

All I’m saying is–

Samuel Lang:

No, sir.

I understand.

I think that’s correct and I think that in even in our case that he’s deciding the merits of the case as a matter of — of effect.

I mean that the end result is that he’s disposing of the case.

Felix Frankfurter:

I understand that, but — but if there is a threshold question to jurisdiction —

Samuel Lang:

Yes, sir.

Felix Frankfurter:

— that goes to you that much of used terms?

And you say that where there isn’t a specific negotiation history fencing in what is and what is not.

The whole thing has withdrawn it on bona fide claim that is made where you can’t take it as just a sham for the usual exception to everything in this world.

Felix Frankfurter:

You say in order not to let it go to arbitration, he would in fact have to adjudicate that question, wouldn’t he?

In that place where there’s no negotiation (Voice Overlap) —

Samuel Lang:

That he had nothing more in the contract or nothing more before him except —

Felix Frankfurter:

Except the contract in all its details.

Samuel Lang:

— which would be exactly like ours.

Felix Frankfurter:

Yes.

Samuel Lang:

Then — and he decides it was not arbitrable, he would have to pass upon the management rights clause if he relied up on that —

Felix Frankfurter:

Yes.

Samuel Lang:

— purely and simply in his interpretation of that provision without reference to anything the parties had indicated to be their intent.

And I think that he would be on dangerous grounds.

And that brings me to this question and Mr. Feller has suggested that this case is more difficult.

I will go a bit further, it’s a difficult case.

And I say that with full awareness of what Mr. Justice Frankfurter has said during the course of this argument that we have an institution of arbitration which is highly desirable.

And it’s highly desirable that we not injure the process.

At the same time, it’s highly desirable that it not be injured by discrediting it by making management feel, to have a feeling of frustration, by making it take long strikes and battle over getting this negative language into the contracts which further cripples the arbitration process.

Now, if the management knows, and this addresses itself to the question of public policy because we very strongly feel that it will advance the cause of arbitration if the Court decides to affirm the Circuit Court.

For this reason, management is very touchy and sensitive.

Professor Cox has pointed that out about arbitration.

There is no secret of the fact that management is wary and distrustful of arbitration and the reasons are — are evident.

The fact is that if management is told in a situation of this kind, you — the only way to protect yourself, and we say that management did everything it possible could to get this interpretation into the agreement and into the life of the parties.

That if — if the management has told that in this type of case it has no protection that an arbitrator can come along and decide on the basis of an interpretation of seniority clause that it had no right to contract out this work or any part of it and management is going to be told that it has got to get into the contract, something to further limit arbitration.

It’s got to perhaps be conservative and go so far as to have no arbitration in the agreement.

And that certainly is not a healthy condition.

What we are contending for here is and this, I think, is awfully important to the Court.

What we are contending for here is that the Federal District courts be allowed to look at the question of arbitrability in the light of the real situation existing between the parties and where that court finds that the party is clearly exhibited as they did here, an intent not to put contracting out in the area of arbitration, then not let someone come in the backdoor and yes, through an arbitrator of what he couldn’t get in bargaining and what he didn’t object to all the while it was going on in the practice.

Felix Frankfurter:

What do you say, Mr. Lang, to Mr. Feller’s contention that what the union tried to get into the argument was to put it a mildly, a much broader provision than they claim they now make for submission to arbitration?

Samuel Lang:

I think that is a distinction without a difference, sir.

I — I see a difference.

It is a — it’s a difference on paper only though as I see it.

What it is saying is now, we don’t — we don’t say that we will object to all of the contracting out of work.

Samuel Lang:

We only want the right to veto that which we don’t like.

But that language in a contract to an employer can only have one meaning.

It means he can’t ever contract out work without getting the permission of the union in advance.

Felix Frankfurter:

That brings me to remarks you made a minute ago — the comments made a minute ago about the sensitiveness to management — of management against the arbitration.

Would you care to say what — on what basis of experience, I don’t mean the general attitude to which I’m — I think not wholly unfamiliar, but what in the basis of experience with arbitrators such those had been named, the late Dean Shulman or Mr. David Cole of Jersey, what — on the basis of what experience do they feel that arbitration is the kind of a loaded dice?

Samuel Lang:

Well —

Felix Frankfurter:

Would you care to say something about that?

Samuel Lang:

You’ll have to ask — you have ask me a double question, sir and I’d have to answer in two parts.First of all, I have never heard anyone say anything but the kindest and most praiseworthy things of the Dean Shulman, Mr. Cole and — and some of the others who had national statute.

Felix Frankfurter:

I do know that for years, he tried to be released from the umpiring, the arbitration under the arbitration scheme, has been fought for years.

And Ford simply wouldn’t.

I don’t mean the union but Ford wouldn’t —

Samuel Lang:

Yes, sir.

Felix Frankfurter:

I mean the union approached this but –.

Samuel Lang:

Yes sir, I — and I —

Felix Frankfurter:

But you don’t happen to know that experience in detail.

Samuel Lang:

And — and I know that’s true, that — that to be true, a good many other arbitrators too.

But unfortunately, there are so many thousands of these cases that those who have this national statute and in this fine reputation are not available in all of them.

And — and a great many of them, you asked an opinion, I will give it for whatever its worth and a great many of them, employers and some unions feel that they are merely trading cases.

That they want to be appointed in each of the cases so they’ll decide one for the union one day and one for the employer the next day.

Life — Fortune Magazine had an article to that affect a year or two ago.

Moreover, some employers feel that some arbitrators are influenced by the fact that they can’t gain continued employ — appointments unless they decide cases a certain way.

They get reputations for deciding discharge cases in certain way and seniority cases in certain way and so on.

Nonetheless, the fact remains that employers are distrustful as a general rule of arbitrators and that they have known of some unions to be distrustful of arbitrators and to want to avoid arbitration.

Felix Frankfurter:

Litigants don’t like to lose, do they?

Samuel Lang:

That’s right, sir.

[Laughs]

Charles E. Whittaker:

Maybe that system is precisely ones for views in connection with some (Inaudible) bad essence.

Samuel Lang:

It’s not bad if the right one is decided for me.

[Laughter]

The — the question of the quid pro quo.

Samuel Lang:

It deserves some comment also.

The union seems to feel here that it’s helpless if — with this no-strike clause, if it doesn’t have the right to arbitrate this grievance.

That — that phrase in the Lincoln Mills case doesn’t mean what Mr. Feller says it means at all.

Obviously, it doesn’t.

Mr. Justine who is also a national arbitrator and who is a Professor at New York University, has written an article, which we have cited in our brief and which he has very clearly shown that the quid pro quo is the absolute no-strike clause and the wide-open, all-inclusive arbitration clause which is very common.

The — the use of the term “conventional clause and standard clause” is not to be taken to mean that that clause appears in the vast majority of the union contract.

That’s not at all true.

In fact, a great many employers as well as a great many unions want the wide-open clause because they want to be sure that they’re not even any wildcat strikes.

They want to be sure that everything is arbitrable.

Larger companies particularly, they want to be sure that there’s no contention of arbitrability by the union or by the employer.

So the wide-open clause is a very popular clause, it has a lot of reason and merit to it.

This conventional clause as Professor Cox has said and I would like to take the time to read to the Court what he has said about it.

“It is a clause of very limited jurisdiction on the arbitrator.”

It means that — it says what the arbitrator may not do.

It has implications of holding that arbitrator to the specific provisions of the contract.

Professor Cox has said and we quote him on page 32 in footnote 37 in the latter half of the footnote.

“I am persuaded that the conventional arbitration clause is not an agreement to allow an arbitrator to interpret its meaning thereby determining its own jurisdiction.

The contrast between the wide-open clause and a conventional phraseology is too plain to be put down to in inadvertence.”

Apparently, the parties choose it because one party, usually the employer, discuss arbitration at least to the point of insisting upon the inclusion of some safeguard against the arbitrators imposing significant obligations not contemplated by the agreement and beyond its scope.

This clause tells what the arbitrator cannot do.

The protection sought by the employer would be drastically reduced by construction which give the arbitrator unlimited jurisdiction and merely won against this exercise.

Now here, the rest of the clause goes on to make a distinction which I started to make a moment ago.

We’re asking the Court to let the Federal District Court subject to the review of the Circuit Courts and this Court to let the district courts look at what the parties have done and what they have intended to determine arbitrability.

In cases of substance I might add, in other words, to let the — to let the Federal District courts and we suggest that Congress so intended, look at substantial cases of this kind and make the decision as to arbitrability.

And once the question is fairly clear that it is arbitrable, then the general power of the arbitrator and this I submit is the difference between Mr. Feller and myself.

The general power of the arbitrator then comes into place.

And he may roll all over the ballpark with all the provisions in it.

He may say that something which appears to be ridiculously related to some provision, nonetheless, is governed by it.

That’s his province and we can’t complain because we’ve given him the power to do so.

But to the point of giving him power, we think the district courts have got to have the authority to make the determination.

Samuel Lang:

That since 301 alone is responsible for that authority, we have to look at what 3 — how 301 was adopted and what it stands for.

And I don’t think there’s any doubt that the legislative history of 301 puts in the Federal District Court the power to do the things which it did here.

I — I well understand and well appreciate the super — superimposition upon that of our acceptance of arbitrary — of arbitration and the importance of arbitration in this field.But nonetheless, if we don’t have the judicial protection of what we think we have negotiated and in the way of arbitrability.

And I’m delimiting my argument entirely to that in the way of what we — what power we have given to the arbitrator.

If we don’t have judicial protection for that, then we are going to have to go in our negotiation to a provision which outlaws arbitration in either in absolute form or in limited form.

And that would be a highly undesirable result.

Mr. Feller’s premise is that we don’t have and can’t have this judicial protection.

That anytime in the complaint, and I don’t care how he close it and how he seeks to get around it.

He is nonetheless making this statement in his brief.

He’s making it in his argument and it is inescapable that his position is, that anytime a claim is made however ridiculous, it’s arbitrable.

Now, we — we can’t conceive, of a holding which would deprive us of what we have negotiated with this union and what we have, how we have lived with this union on the question of the extent of the power to be given to the arbitrator.

That’s very important.

Without it, we have not negotiated a contract.

All the no-strike clauses in the world won’t do us any good if the arbitrator may arbitrate any and every claim.

We have no protection whatsoever.

All of our efforts to — to limit this rolling all over the ballpark have gone for naught.

So much of what is in our brief and what I prepared for argument is concerned with the power of the Court which counsel has acknowledged is there that it is unnecessary for me to go into the legislative history, into the national policy as reflected by the Railway Labor Act and by the National Labor Relations Act and as shown by the Jacobs Manufacturing Company case and — and in it’s other interpretation of that Act going to show that this a voluntary consensual agreement, that is the agreement to arbitrate and I repeatedly — and I repeatedly emphasized the difference between the agreement to arbitrate and the other provisions of the contract and that the interpretation which has always been given to these agreements to arbitrate.

In the Railway Labor Act, under the administration of the Railroad Adjustment Board and the National Mediation Board and — and elsewhere in our national policy dealing with arbitration has been to give a wide scope to the district courts in their construction of what the parties have agreed to arbitrate.

The attempt — the attempt by counsel to merge the Warrior & Gulf case into the American and Enterprise (Inaudible) cases, must be rejected.

Now, our case is not only a more difficult one, it’s an entirely different case.

Here, as Mr. Justice Frankfurter has pointed out, we are striking at the threshold of the arbitrator’s jurisdiction, of the arbitrator’s authority.

In those other cases, we are dealing with matters which are not concerned with the power of the District Court as such.

That is the power conferred by Section 301 as I conceive it.

We’re dealing with the power of the District Court in both of these cases to interfere when the functions of the arbitrator.

That’s my conception of the basic difference between our case and the other cases.

So we have here an entirely unrelated case except to the extent that you may say that it all involves arbitration and such arbitration is a very salutary institution, we should treat all these cases as the same as one and — one and the same involving the same principles.

But there is — there is such a vast difference particularly when we have the — the admission that the union had the burden of proving that there was a violation of the agreement to arbitrate.

That we could and should take the Warrior & Gulf case entirely out of the realm of consideration of the other two cases.

I don’t think it necessary and our brief treats this in some detail to point out that although arbitrators have relied upon the recognition clause and the lock-out clause, and the seniority clause and the discrimination clause and so forth and so on in making decisions on — on apparently unrelated subjects.

I don’t think it necessary to point out that that subject is a apart and aside from what we’re talking about here because of the conduct of the parties.

Samuel Lang:

If we didn’t have the objective conduct of the parties here in which they paid no attention to these provisions in sustaining and agreeing to in acquiescing in the Company’s right to contract out work, then I would I admit that these provisions — these other provisions of the contract, could be examined and inquired into.

As a part from the fact as we pointed out in the brief that their origins, there genesis are in different situations entirely.

The Court has dealt with labor problems from many more years than I have and is much more familiar than I am with the origins, the provisions of this kind.

These provisions don’t have any direct connection with contracting out work.

Each one them has in argument, a different situation.

Lock-out for example, the Court treated with in the Buffalo Linen case.

If that’s a pure type, that’s a lock-out situation where an employer shuts down to bring economic pressure upon employees in order to get them to do or not do something in connection with their union activity or negotiations.

We don’t have a situation here of discrimination.

We don’t have a situation here of depriving certain people of seniority in preference to others.

We don’t have a lack of recognition of the union here.

We had all union employees, all of these — all of these employees, all of our wage earners are covered by union contracts, five of them.

And our, union our members are prone in number, the record shows from the inception of our relations with the union.

We didn’t have a condition here which — which should be related to any of these provisions.

Felix Frankfurter:

Mr. Lang, may I ask this question.

You speak of your reliance is on what you call the objective conduct of the parties prior to the formulation of the agreement, is that right?

Samuel Lang:

And subsequent to it.

Felix Frankfurter:

In this case, the clause in controversy or the claim in controversy was reduced in writing, there was a document which adds for the inclusion of a particular clause, is that right?

Samuel Lang:

The proposal?

Felix Frankfurter:

Proposal, yes.

Samuel Lang:

Yes, sir.

Felix Frankfurter:

And rejected.

Am I right in assuming that you wouldn’t draw a distinction between objective conduct evidence by a piece of paper and objective conduct that comes out to the mouth of witnesses?

Samuel Lang:

I do draw the distinction for this reason.

The proposal that is made is an attempt to change and accept the practice.

Now, that is objective conduct stated at a time when the party making the proposal recognizes that he has accepted the practice.

And when that proposal is rejected and he continues to accept the practice without filing a grievance, it confirms his understanding of what he and the employer have agreed to.

Felix Frankfurter:

Well, might not — might not the proposal be made by the chief negotiator for the union by way of mouth.

That in (Voice Overlap) —

Samuel Lang:

Well, I don’t — no, sir.

I don’t make any distinction.

Samuel Lang:

I misunderstood you, sir, between a verbal proposal and a (Voice Overlap) clauses.

Felix Frankfurter:

The written one.

Samuel Lang:

No, sir.

I don’t.

Felix Frankfurter:

So that an — an — it would be consonant with your argument that evidence by witnesses as to what was proposed and what they rejected and so on, without any documentary proofs would, come within your adoption, wouldn’t it?

Samuel Lang:

Yes, sir.

Felix Frankfurter:

I just want to be sure.

Samuel Lang:

Yes, sir.

We emphasize in closing two basic points.

Number one, the Court here construed this contract as it not only had the right to do, but as it had the duty to do under Section 301.

It couldn’t have avoided construing this contract in any other way.

That its — its conclusion, its findings are based upon the finest traditions of our law in contract interpretation.

And incidentally, the finest traditions of our arbitration law, and I’ve cited to speak of nationally known arbitrators.

I cited the case which Mr. — Mr. Peter (Inaudible), who is equally as well accepted nationally as the other gentleman in which he said he found no case in which they had done a decision contrary to that, similar to the decision of the Court in our case and the facts weren’t all for us in that case.

I’ve cited the case in our brief.

The principles which arbitrators rely upon to a very large extent are all those which this Court relied upon.

Professor Cox emphasized past practice, emphasized the conduct to the parties.

The Court emphasized those things here.

The second basic point on which we rely is that, this decision is good for arbitration, that this decision is good, for our industrial relations.

That if we have a decision which rejects the theory of our case, that it is going to hurt.

The union may have won the war, but it will have lost the case.

Thank you, sir.

Earl Warren:

Mr. Feller.

David E. Feller:

I will take, the Court’s permission only a minute.

Now, there is a case which I wanted to — when you directed the citations, I I would like you and Your Honors as an illustration of the reverse twist on this matter which I referred to in the Timken Roller Bearing case.

This case is Structural Steel Association, the Shopmen’s Local Union, as a district court case.

Potter Stewart:

Is it in your brief?

David E. Feller:

It’s not are in our brief, Your Honor Its in 172 F. Supp. 354.

That was a case in which the employer contended that the grievance was arbitrable and the union contended it was not, because what happened there was, the union said you have to put a help around and the employer said we don’t, and the union struck.

And the question was whether the grievance was arbitrable.

David E. Feller:

The courts always find grievances arbitrable, I should say, those kinds of situations and I think all really, we want as the same rule when it goes both ways.

Potter Stewart:

What kind of a no-strike clause was there, if any?

David E. Feller:

Well, it’s not explicit, but it is quite clear that the decision came about and this is not uncommon.

I do want to comment on Mr. Lang’s taken about the wide-open clause, to have done and our contracts with the in the Aluminum Company has.

Any grievance which is not arbitrable is strikable.

William J. Brennan, Jr.:

Is strikable.

David E. Feller:

Strikable.

Where you have that, I’m quite sure that Mr. Lang is quite candid, saying that if he wins this that it’s not arbitrable, then he wins it all the way.

Well, this contact, you can’t argue that because the whole grievance procedure says that should these things arise, there shall be no work stoppage, but the following procedure shall be used.

Now, he would like to have, and of course, he has also a independent no-strike clause.

He wants to have it.

The no-strike clause applies but it’s not arbitrable.

Well, in other words the Court, and he said he was going distinguish the merits from the merits, I don’t think he was able to distinguish the merits from the merits because what he regards as the merits of arbitrability is the merits of the question of there is any contractual limitation on the employer’s action, and that’s merits of the grievance.

I don’t understand the difference.

Felix Frankfurter:

So what he — what he said in effect is, the course of the negotiation, legally amounted to writing in to the contract, rejection of your claim that that farming out stuff gives rise to grievance.

David E. Feller:

Well, that’s — it goes to the merits, gives rise to a grievance.

Well —

Felix Frankfurter:

So if — if that were — if that were in the contract —

David E. Feller:

If the contract said that there is no —

Felix Frankfurter:

If the contract (Voice Overlap) —

David E. Feller:

— grievance shall be processed.

Felix Frankfurter:

No, because the contract says that farming out, or what do you call this — contracting out, is a strictly managerial function.

Then you couldn’t — then even you would agree that you couldn’t come in and say, “Despite that, you’re wanting to — to go to arbitration.

David E. Feller:

Oh, yes, sir.

I agree with that.

Felix Frankfurter:

But, you would —

David E. Feller:

We would come in — on that case, we would — that would be a very telling contractual provision on the merits of whether there was a limitation on the management function.

Felix Frankfurter:

No, but it said specifically that there’s a clause now saying strictly — strict functions of management or whatever it is.

And then it says, “This is a strict function of management”, could you still come in get arbitration?

David E. Feller:

Is this on the arbitration clause, (Voice Overlap) the famous machinery clause?

David E. Feller:

Oh, there.

If it says no grievance shall be processed under this agreement which alleges contracting out, which is, I don’t know how you can make that history here.

William J. Brennan, Jr.:

Suppose — suppose all it was (Voice Overlap) —

David E. Feller:

We — I know —

William J. Brennan, Jr.:

Or by such clause.

This very clause had add up to a strictly a management function —

David E. Feller:

Or dealing — it’s not very —

William J. Brennan, Jr.:

— (which shall include contracting out).

David E. Feller:

Oh, yes, Your Honor.

That there’ll be no question, but — on — on the record here —

William J. Brennan, Jr.:

Then — then it would — then it’d be — it would not be arbitrable.

David E. Feller:

Oh, oh, they have clear this, is not to be arbitrable.

William J. Brennan, Jr.:

That’s what — I think that’s —

David E. Feller:

Because it says it isn’t arbitrable.

William J. Brennan, Jr.:

That’s Mr. Lang’s —

Felix Frankfurter:

That’s his argument.

David E. Feller:

Well, then — but that is not what — that’s his argument here.

It’s not — was not his argument below.

It was not the findings of the court below.

Felix Frankfurter:

The man has a chance to going with it.

David E. Feller:

I think so, Your Honor.

We’ve thrown according to Mr. Lang’s in — in —

William J. Brennan, Jr.:

Well, I suggest you would find grief —

David E. Feller:

— my argument here.

William J. Brennan, Jr.:

— indicates it should have since you went through his whole brief.

David E. Feller:

No, I — I would — I would claim — I’ll admit to having grown or confessed to having grown but we have never contended in this Court, in our original brief or in our reply brief that the arbitrator in this kind of cases has jurisdiction to interpret the arbitration clause.

We said —

William J. Brennan, Jr.:

Well, at least —

David E. Feller:

— for such —

William J. Brennan, Jr.:

— (Voice Overlap) explicitly stated, that position explicitly stated and we will try to —

David E. Feller:

It’s more explicit.

We thought it was implicit in our original brief.

I would want to comment, if I may, Your Honor, for one minute.

Earl Warren:

You may take a minute.

Yes.

David E. Feller:

On this — Mr. Lang said that the wide-open clause, so-called, as the common — as a common clause industry.I have no — practically no agreement.

I’ve been told that the Western Union agreement with the Commercial Telegraphers Union is probably on the agreement but then large units, which has what he what he calls, the wide-open clause.

The clause which everybody has in American Industry is the clause in American Manufactures, which we think this clause is the same.

The so-called wide-open clause in which you can arbitrate anything, whether it relates to the contract or not is the most atypical clause.

And let me — again, to show the Court that at least as far I know, management’s attitude toward arbitration, some of the justices asked that of Mr. Lang.

In the big industries, in a responsible place where there is responsible labor relations history and a blown-off arbitration practice, what is shocking both to management and to the union eyes, is the notion that arbitrators don’t decide this kind of question without — without doubt, because they decide them all the time, and without argument.

This kind of case, a contract New York case, we’ve — said Mr. (Inaudible) decisions by Mr. (Inaudible) on the merits of — of contracting out.

There are decisions by Mr. Garrett, Mr Seward, and David Cole, there are decisions by all of them, but they — none of them would dream of saying that under a clause, other than one which specifically exempted that kind of thing, a contracting out grievance was not arbitrable.

Felix Frankfurter:

May I ask you this before you sit down?

Why did you — why did you — did you not ask for — for some rejections?

Why did you go to trial?

Why did you just file your complaint and next the agreement and the rest?

David E. Feller:

We did, but the —

Felix Frankfurter:

Well, you didn’t.

David E. Feller:

If Your Honor please, when I started my argument, I said the answer, if you remember?

The answer has set up all these practices, and as all these notions which went to the merits of the grievance.

Felix Frankfurter:

Yes, but to you, all that is irrelevant?

David E. Feller:

That’s right.

And so we moved to strike that.

Felix Frankfurter:

Yes.

David E. Feller:

And the District Court overruled our motion to strike.

Felix Frankfurter:

Well, I just want to know why you didn’t ask summary judgment, nevertheless.

David E. Feller:

Well, we moved for preliminary injunction which was the same thing.

But we were at a hearing on their motion to dismiss, and our motion for preliminary injunction, the judge said, “Let’s hear it all.”

We said, “Okay, let’s strike that — that defense.”

David E. Feller:

Because that goes to the merits.

I believe that was argued.

I — didn’t participate.

And that was argued to the Court.

And we said, “This is not relevant here.”

And the Court says, “It is relevant.

Now, I overrule motion to strike.”

Well, under those circumstances, counsel said, “That being so, we introduce this evidence under protest and the transcript is clear.

Every time counsel, Mr. Lang said, “You get to the merits”, Mr. Black who tried the case, said, well, that, Your — Your Honor has overruled my motion to strike and I feel I’m compelled to go through to protect myself to introduce this evidence.

Felix Frankfurter:

On your, theory you could stood that on your complaint and not offer any evidence until Mr. Lang offered his memory book, is that right?

David E. Feller:

I think so.