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TRAUSS v. CITY OF PHILADELPHIA

March 14, 1958

Casimir TRAUSS, Individually and trading as Trauss Electric Service, etc.,
v.
CITY OF PHILADELPHIA, Richardson S. Dilworth, Mayor, et al. Max ZUCKER, etc., v. CITY OF PHILADELPHIA, Richardson S. Dilworth, Mayor, et al. Ralph GLASSMAN, Individually and trading as Alert Electric Company, etc., v. CITY OF PHILADELPHIA, Richardson S. Dilworth, Mayor, et al. M. ZUCKER COMPANY, a Pennsylvania Corporation, etc., v. CITY OF PHILADELPHIA, Richardson S. Dilworth, Mayor, et al.



The opinion of the court was delivered by: LORD

These cases were argued and will be considered and disposed of together. They are four separate equity actions brought by individuals in their capacities as contractors on municipal public works, as taxpayers, and as representatives of others so situated. The numerous defendants comprise the City of Philadelphia, the Mayor of Philadelphia, other Philadelphia officials, the members of a certain Philadelphia Board of Labor Standards, five labor unions, and labor officials. Some of the defendants are sued in more than one capacity.

The gravamen of the complaint is a certain 'Addendum to City Contracts', a physical supplement which is inserted in the existing forms of specifications for bids and contracts of the City of Philadelphia for public works. Its chief provisions are that the contractor shall pay his employees no less than the wages prevailing in the community, and shall provide the generally prevailing working conditions. It further requires that, as to contractors not having collective bargaining agreements with their employees, controversies under this Addendum shall be referred for arbitration to a Board of Labor Standards. The makeup of that Board is stipulated in the Addendum itself -- the Board being a creature of the Addendum. Decisions of the Board shall be final.

 This Addendum was the focus of a controversy between Glassman, one of the present plaintiffs, and the City of Philadelphia in a cause heard by the Court of Common Pleas No. 6 of Philadelphia County, September Term, 1956, No. 2784. The opinion of Levinthal, J., disposing of the matter on preliminary objections is reported in Glassman v. Philadelphia, 1956, 9 Pa. Dist. & Co. R.2d 495. That the main issues here presented were raised in that controversy is shown by the opening paragraph of that opinion at page 496:

 'The basic issues raised by the pleadings in this equity suit are (1) whether or not certain provisions in the contracts between defendant city and plaintiff contractor, requiring the latter to pay his employes no less than the wages prevailing in the community and to provide generally prevailing working conditions, are legally valid, and (2) whether or not the arbitration provisions in the contracts are enforcible.'

 After thorough and detailed discussion of those issues, and many other contentions of plaintiff similar to those advanced in the instant case, the court dismissed the complaint but granted the counterclaim of defendants and ordered the plaintiff specifically to perform the arbitration agreements.

 It was conceded at oral argument that no appeal was taken from that dismissal; that the grievances in question proceeded to arbitration; and that plaintiffs' exceptions to the decision of the arbitrators are now pending before the Court of Common Pleas of Philadelphia County. Pending also are motions for depositions, interrogatories, and protective orders involving substantially the parties in the present cause.

 The briefs and arguments of respective counsel invite attention to the sufficiency of statement of the equitable grounds and a great deal more, but defendants' objections to the jurisdiction of this Court compel immediate attention. Touching the merits, therefore, it will only be observed that if the allegations were to be considered as true for the purpose of a general motion to dismiss, they are not to be taken lightly in a court of equity. Conversely, if they are not eventually supportable by evidence, it would seem that plaintiffs have pressed the privilege of the pleader to the utmost limits. If this Court is coram non judice, however, the substance of the numerous allegations cannot properly be considered here.

 A reading of the opinion in the unappealed decision of Judge Levinthal makes clear that a local court has already passed upon a number of the very matters again sought to be raised by the present plaintiffs. In that opinion the contract provisions were set out in detail, and carefully considered in the light of the Pennsylvania decisions, the applicable statutes, and the Lowest Responsible Bidder provisions of the Philadelphia City Charter. In all respects the contract provisions of the challenged Addendum were found lawful and equitable. Accordingly, the plaintiff was directed to submit his grievances to arbitration on the grounds that he was estopped to question the arbitration requirements to which he had knowingly and deliberately subscribed.

 The complaints before this Court nevertheless persist in the contention that the Addendum is wholly illegal, and was promulgated without benefit of any ordinance or executive order. It is further alleged that the Addendum was incorporated into specifications for bids and city contracts in collusion with labor unions; that the membership of the Board of Labor Standards has been packed in favor of union labor; and that a fair hearing cannot be obtained by an employer of non-union labor in arbitration before that bureau. The plethoric assertions as to discrimination, conspiracy and overreaching are by no means to be taken lightly, but it seems somewhat gratuitous to recount them here unless a federal question is presented to give this Court the bare power to consider them. Illustration will therefore be confined to one sample of the bitterness of plaintiffs' asserted grievances -- an offer contained in their trial brief:

 'If your Honorable Court permits the Plaintiffs here to go to trial, the transcript of the proceedings before the so-called Board of Labor Standards will be introduced into evidence as the best proof of the 'kangaroo' proceedings to which the said Ralph Glassman was subjected * * *.'

 The threshold impediment to permitting plaintiffs ever to offer such proof here is that this is a Court of not only limited, but also of purely statutory jurisdiction. The Constitution of the United States does not permit one to come into a District Court of the United States under its direct authority. Kline v. Burke Const. Co., 1922, 260 U.S. 226, 234, 43 S. Ct. 79, 67 L. Ed. 226. Every federal court, for that matter, other than the Supreme Court, derives its jurisdiction wholly from the authority of Congress. Mason v. Hitchcock, 1 Cir., 1939, 108 F.2d 134.

 Although the complaint alleges the jurisdictional amount of $ 3,000, the parties are Pennsylvania citizens, and no attempt to show diversity has been made.

 Since we do not derive jurisdiction directly from the Constitution, it is clear that our authority must be found in Congressional enactments. Since diversity is not claimed, warrant would have to be found in Section 1331 of the Judiciary Act:

 'The district courts shall have original jurisdiction of all civil actions wherein the matter in controversy exceeds the sum or value of $ 3,000, exclusive of interest and costs, and arises under the Constitution, laws or treaties of the United States. June 25, 1948, ...


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