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LOCUST CLUB v. HOTEL AND CLUB EMPLOYEES' UNION. (10/21/59)

October 21, 1959

LOCUST CLUB, APPELLANT,
v.
HOTEL AND CLUB EMPLOYEES' UNION.



Appeal, No. 190, Jan. T., 1959, from decree of Court of Common Pleas No. 1 of Philadelphia County, Sept. T., 1957, No. 2822, in case of Locust Club v. Hotel and Club Employees' Union, Local No. 568, AFL-CIO et al. Decree affirmed. Equity. Before GRIFFITHS, J. Adjudication filed dismissing complaint; plaintiff's exceptions to adjudication dismissed and decree entered, dissenting opinion by HAGAN, P.J. Plaintiff appealed.

COUNSEL

Robert H. Kleeb, with him Kenneth Souser, and Morgan, Lewis & Bockius, for appellant.

Edward Davis, for appellees.

Before Jones, C.j., Bell, Musmanno, Jones, Cohen and Mcbride, JJ.

Author: Mcbride

[ 397 Pa. Page 358]

OPINION BY MR. JUSTICE MCBRIDE

The Locust Club is a Pennsylvania non-profit corporation organized and operated for the purpose of maintaining a clubhouse and for the promotion of friendship and good citizenship. It operates a bar and restaurant for the pleasure and accommodation of its approximately 300 members and the use thereof by

[ 397 Pa. Page 359]

    non-member guests is merely incidental. It is not engaged in any industry, commerce, or business separate and apart from the maintenance of the club. The Union is an unincorporated labor organization, its membership being composed in part of cooks, waiters, bartenders, waitresses, bus help, dishwashers, bell men and linen room attendants, i.e., the same job classifications as those of the persons employed by the club. It represents as bargaining agent such employees of 31 hotels and 2 clubs which are similar to the Locust Club. Lawrence Stoltz is the President and Business Manager of the Union.

In August, 1956, the Union made a demand upon the club for recognition as collective bargaining agent of the club's employees claiming to represent the majority thereof. The club refused. Thereupon the Union, on or about October 18, 1956, caused some employees of the club to strike and has since that time caused the clubhouse to be picketed by varying numbers of persons. It was stipulated that at the time the strike was called and the picketing commenced, the Union represented 12 of a total of 19 employees of the club such as would have constituted an appropriate bargaining unit; that 10 of the 19 employees never participated in the strike; that the 9 employees who did participate in the strike have all been replaced by the club. The various legends of the picket signs have indicated that a strike was in progress, that the club's employees are not members of the union, and also contained the statement "Union requests your cooperation".

The request of the club for a preliminary injunction restraining the picketing was refused by Judge GRIFFITHS, the chancellor, and although the club took an appeal it was later withdrawn. Stipulations of fact were entered into and the matter was decided by the

[ 397 Pa. Page 360]

    chancellor on final hearing. The chancellor filed an adjudication denying injunctive relief and dismissed the complaint. On exceptions his findings were sustained by the court en banc, consisting of GRIFFITHS and CHUDOFF, JJ. President Judge HAGAN dissented.

It is conceded by both parties that the questions before this Court are purely legal since the essential facts are not in dispute. Those questions are two-fold: (1) Does the Labor Anti-Injunction Act*fn1 apply so as to oust the jurisdiction of the court below to grant an injunction? and (2) Assuming it does not apply, was it error under the circumstances of this case to refuse an injunction?

The legislature has ordained in the Labor Anti-Injunction Act that the courts of Pennsylvania are without jurisdiction to grant a temporary or permanent injunction "contrary to the public policy declared in this act" or "in a case included within this act". 43 P.S. § 206d. The Act stated the public policy of the Commonwealth to be that "... the individual unorganized worker is commonly helpless to exercise actual liberty of contract and to protect his freedom of labor, and thereby to obtain acceptable terms and conditions of employment, wherefore, though he should be free to decline to associate with his fellows, it is necessary that he have full freedom of association, self-organization, and designation of representatives of his own choosing to negotiate the terms and conditions of his employment ..."

A "case included within this act" is one which grows out of a "labor dispute" as defined therein. A "labor dispute", as stated in 206c(a)(b) and (c), exists where "the case involves persons who are engaged

[ 397 Pa. Page 361]

    in a single industry, trade, craft or occupation, or have direct or indirect interests therein," or concerns "the association or representation of persons in negotiating, fixing, maintaining, changing, or seeking to arrange terms or conditions of employment or concerning employment relations or any other controversy arising out of the respective interests of employer and employee ..."*fn2

[ 397 Pa. Page 362]

The word "employer" includes a corporation not for profit.*fn3 The term "employe" includes all natural persons who perform service for other persons.*fn4

We have held in Pennsylvania Labor Relations Board v. Overbrook Golf Club, 385 Pa. 358, 123 A.2d 698, that a club is not an employer within the meaning of the Pennsylvania Labor Relations Act*fn5 and hence may not be compelled by the Labor Relations Board to recognize the union or to engage in a collective bargaining agreement with it. That, however, does not mean that the club is prohibited from doing so unless that would be unlawful or constitute an unfair labor practice. It does not follow that the club is not covered by the provisions of the Labor Anti-Injunction Act. That point was not involved in the Overbrook case.

Both acts were passed at the same session of the legislature. Nevertheless, we may not overlook obvious differences in language, particularly in the coverage section; all provisions of each statute must be read so as to effectuate the intention of the legislature.

[ 397 Pa. Page 363]

We are obliged to hold that since the word "employer" in Section 206c of the Pennsylvania Anti-Injunction Act specifically includes corporations not for profit the Locust Club is an employer within the meaning of that act. It remains to inquire, therefore, whether the present case is a labor dispute as that term is used in the Labor Anti-Injunction Act.

The court below, on sufficient evidence, found as follows: "The employees of the Club are in direct competition with the employees doing similar work at hotels and restaurants affecting the labor market and the plaintiff is engaged in the respective trades and occupations of its employees so engaged."

In respect of the club the chancellor stated, in the adjudication: "... It operates a barber shop in competition with outside shops for the trade of its members. It also operates a restaurant in competition with other restaurants and hotels for the trade of its members for lunches and dinners. No doubt many of its members partake of their downtown, weekday lunches almost exclusively at the club to the loss of such business by other downtown city hostelries. The fact that the restaurant is operated at a loss does not gainsay the simple truth that the club is in the business of selling meals to its members. Many business houses have at times operated at a loss, but such a fact does not, as a chameleon, change the nature of its business by the color of the ink used in its final entry on the balance sheet. Furthermore dues of members are intended to implement such facilities afforded the membership.

"We believe the plaintiff is in as much a trade or occupation as any other restaurant or barber shop. ..."

The court held, therefore, that it lacked the power to grant an injunction because of the provisions of the Labor Anti-Injunction Act.

[ 397 Pa. Page 364]

The club relies upon Western Pennsylvania Hospital et al. v. Lichliter et al., 340 Pa. 382, 17 A.2d 206, in which we held that neither the Labor Relations Act nor the Labor Anti-Injunction Act applied to such a hospital. Here, however, it is obvious that the operation of a club, such as the present one, is different from the operation of a hospital so far as concerns the effect of the Labor Anti-Injunction Act. The court below has pointed out the ways in which the activities of this club, with its bar, barbershop and restaurant, partakes of the nature of any other restaurant or hotel except that overnight accommodations are not provided. The fact that its clientele is limited to its membership constitutes a difference in degree and not in kind. The controlling feature is that the employees of the non-profit club perform the identical wage-earning duties performed by other employees in profit-making establishments such as hotels and restaurants and thus are engaged in an occupation which gives both an interest in their mutual wages or working conditions. To analogize the operation of this social club to the operation of a charitable hospital, which deals with the health and indeed the life of the general community, would be to prefer shadow to substance.

The relief sought in the present case is against the Union and through it against its membership. Thus this is a controversy arising out of the respective interests of employer and employee and is by definition a "labor dispute" within the meaning of that term in the Labor Anti-Injunction Act. The Act was a procedural statute designed to protect workmen. The Labor Relations Act was primarily intended to deal with labor disputes by an administrative agency; the Labor Anti-Injunction Act was a specific limitation upon the power of courts. That the two are related do not make them necessarily coextensive.

[ 397 Pa. Page 365]

It remains to consider the point raised by the club, that although the union at the time of the strike represented a majority of the employees, it did not do so at the time this suit was instituted.*fn6 The chancellor, while recognizing that the Locust Club could not be prevented from replacing the striking employees by administrative or legal procedures, held that this condition should not be permitted to frustrate the legitimate purpose of the union, which at the time of the strike had a majority and did not lose it by the non-redressable unilateral act of the club in replacing those employees. To hold otherwise would obviously defeat the public policy of the act. In Anchorage, Inc. v. Waiters & Waitresses Union, 383 Pa. 547, 119 A.2d 199, we found that the evidence which justified the court in making a distinction between conduct which may have been lawful in its inception but became unlawful through persistence long after it became clear that the lawful object could not be obtained, has no application here where the changed status has been brought about not by virtue of any act on the part of the union but by the ex parte act of the club, whether lawful or not. In other words, here the club is seeking to take advantage of a change in the status quo created by itself. The court below was fully justified in holding that it would not give controlling influence to such a position. It is not even contended by appellant that this was an organizational strike. Clearly its purpose

[ 397 Pa. Page 366]

    was not to gain new members either by lawfully persuading the employees to join or unlawfully coercing the employer to require the employees to do so.

It is clear that the present case is "included within" the Labor Anti-Injunction Act and that to grant the injunction would also "violate the public policy declared by the Act".*fn7 The court below was correct in holding itself to be without jurisdiction in this case.

Even if the Labor Anti-Injunction Act were not applicable we would still necessarily affirm the court below.

Courts of equity, under the Act of June 16, 1836, P.L. 784, § 13, 17 P.S. 281, 282, and the Act of February

[ 397 Pa. Page 36714]

, 1857, P.L. 39, § 1, 17 P.S. 283, have had and continue to have jurisdiction to grant or refuse to grant injunctive relief even in labor disputes except where such jurisdiction has been withdrawn. See Main Cleaner & Dyers, Inc. v. Columbia Super Cleaners, Inc. et al., 332 Pa. 71, 75, 2 A.2d 750; Bright v. Pittsburgh Musical Society, American Federation of Musicians, Local 60, 379 Pa. 335, 108 A.2d 810.

It must be remembered that we are not reviewing here a case where the court below granted an injunction; we are, instead, reviewing a case where the lower court refused to do so. Therefore, it does not necessarily avail the club to demonstrate that neither the Labor Relations Act nor the Labor Anti-Injunction Act is applicable. All that would follow would be that the court below was possessed of its reviewable discretionary power to grant or refuse the requested equitable relief under the circumstances of the individual case.

The chancellor here found that the picketing was constitutionally protected and within the public policy of the Commonwealth. Upon this finding he predicated his refusal to enjoin it.

It is well settled that the basic findings of the chancellor, supported by the record and affirmed by the court en banc, will not be disturbed on appeal. DeJoseph v. Zambelli, 392 Pa. 24, 139 A.2d 644; Howarth v. Miller, 382 Pa. 419, 115 A.2d 222. It is likewise settled law that an injunction will not issue in the absence of a clear right thereto. McDonald v. Noga, 393 Pa. 309, 312, 141 A.2d 842. Chancery never puts forth this strong arm of injunction unless in a clear case of the invasion of a private or public right. City of Philadelphia's Appeal, 78 Pa. 33. The club, nevertheless, contends that we must reverse the court below because the conduct of the union was unlawful and should have been enjoined under the Act of 1836, supra.

[ 397 Pa. Page 368]

It is true that in International Brotherhood of Teamsters v. Vogt, 354 U.S. 284, the Supreme Court of the United States ruled that a state has the power to decide its own public policy in the matter of picketing, subject only to the rule that it cannot enact blank prohibitions against all picketing per se.

By way of historical background it is interesting to note that at one time it was considered a criminal conspiracy for men to organize into unions. Cote v. Murphy, 159 Pa. 420, 425, 28 Atl. 190. However, in this State, it was declared by our Legislature many years ago that it was not criminal per se for employees to organize, Act of May 8, 1869, § 1, P.L. 1260, 43 P.S. § 191; or concertedly to refuse to work, Acts of June 14, 1872, § 1, P.L. 1175, 43 P.S. § 200, and June 16, 1891, P.L. 300, 43 P.S. § 199.

While these Acts removed the stigma of a criminal sanction, they did not impose upon an employer the duty to bargain with any organized group of employees. This concept was not part of the law of Pennsylvania until the passage of the Pennsylvania Labor Relations Act in 1937, which was patterned after the National Labor Relations Act (Wagner Act) of 1935. Since the Pennsylvania Labor Relations Act is not applicable to the plaintiff (Overbrook Golf Club, supra) the plaintiff is free to refuse to bargain. This means only that there exists no remedy, administrative or otherwise, whereby the union can compel such recognition and bargaining. It does not mean that the union is thereby prevented from using lawful economic pressure to persuade the club to recognize and bargain, and the lower court has found, upon sufficient evidence, that that is precisely what occurred in this case.

All of this was determined by us in Kirmse v. Adler, 311 Pa. 78, 166 A. 566. That case substantially

[ 397 Pa. Page 369]

    answers all of the club's contentions. The primary aim of the Appellee Union here in picketing the Club was to achieve recognition for the Union as collective bargaining agent, and thereby improve and protect the wages, hours and working conditions of the Club's employees, while at the same time preserving the standards in other unionized establishments among hotels and clubs in the City of Philadelphia. The secondary purpose was, of course, to impose economic pressure upon the patronage of the Club, clearly a lawful act. As we said in Kirmse, at p. 86: "... If one has a legal right to do a particular thing, the law will not inquire into his motive for doing it: Beirne v. Continental Equitable, 307 Pa. 577. Having this unquestioned right to present their case ... in a peaceful way, if the employer suffers loss from this peaceable assertion of rights, it is a damage without a remedy. The controlling factor must be, do the methods used involve intimidation or coercion in any form? If they do not, but are peaceful and orderly, equity will not interfere." (Emphasis supplied.) In reversing an injunction we said, quoting from Kraemer Hosiery Co. v. Amer. Fed. F.F.H. Workers, 305 Pa. 206, 157 A. 588: "This much is secured to the citizen by the constitutional provision that: 'The free communication of thoughts and opinions is one of the invaluable rights of man, and every citizen may freely speak, write and print on any subject, being responsible for the abuse of that liberty.'"*fn8

Although the activity engaged in by the Union in the Kirmse case did not specifically turn upon picketing, as such, the Court there said "Picketing, if peaceful and unaccompanied by coercion, duress, or intimidation, is lawful."

[ 397 Pa. Page 370]

The Kirmse case was decided by this Court prior to the passage of either the Labor Anti-Injunction Act or the Pennsylvania Labor Relations Act, and is still the law today, when the procedural Anti-Injunction Act is not controlling.

Peaceful picketing has been recognized as a form of assembly and of speech, and has been afforded the protection of Article I, Section 7 of the Constitution of Pennsylvania. In addition to Kraemer Hosiery Co. v. Amer. Fed. F.F.H. Workers, supra, and Kirmse v. Adler, supra, cited above, see: American Brake Shoe Co. v. District Lodge 9 of the Int. Asso. of Machinists, 373 Pa. 164, 173, 94 A.2d 884; Wortex Mills, Inc. v. Textile Workers Union of America, C.I.O., 369 Pa. 359, 85 A.2d 851; Alliance Auto Service v. Cohen, 341 Pa. 283, 19 A.2d 152.

It is true that picketing, even though peaceful, is not necessarily beyond the power of a court to enjoin and an injunction may issue wherever the picketing is for an unlawful object or is in violation of state law or public policy. However, the chancellor found that the picketing in this case did not have an unlawful object, was not forbidden by law and did not contravene public policy. That finding was in accordance with the evidence in the case and we uphold it. Therefore, we could not overrule the lower court in this case unless we were to enforce a blanket prohibition against all picketing on the ground that picketing, since it involves more than mere speech, is enjoinable per se. This we could not do even under the Fourteenth Amendment to the United States Constitution. Thornhill v. Alabama, 310 U.S. 88; American Federation of Labor v. Swing, 312 U.S. 321; and Bakery and Pastry Drivers v. Wohl, 315 U.S. 769, even when considered in the light of Teamsters Union v. Vogt, 354 U.S. 284, still stand in the way. But even if the Fourteenth

[ 397 Pa. Page 371]

Amendment did not apply to the facts of this case, as found by the chancellor, we would still be enjoined from reversing by our own Constitution. It is only where public policy, whether enunciated by the court or legislature, or state law, contravene the Fourteenth Amendment that the decisions of the Supreme Court of the United States are controlling. Therefore, even were we permitted by the Fourteenth Amendment to reach a different result, we are not compelled to do so. We rest decision in this case upon our own Constitution, law and public policy.

It may be suggested that this economic warfare, without administrative agency to settle the problem, is undesirable but it is our function to interpret the law as we find it and not to usurp the legislative province. We have here a conflict between a club, which cannot lawfully be forced to recognize or bargain with the union, and a union which, lacking such legal procedures to compel the club to recognize and bargain with it, nevertheless has the right, so long as it does not resort to unlawful coercion, to attempt by all economic means in its power to persuade the club to do what it cannot otherwise compel it to do. There is here involved no question of peaceful picketing which constituted persuasion in the first instance but, having been too long and persistently continuous, becomes a nuisance and an unlawful form of coercion, as in Jefferson & I. Coal Co. v. Marks, 287 Pa. 171, 134 A. 430; nor, as in Anchorage, Inc. v. Waiters & Waitresses Union, 383 Pa. 547, 119 A.2d 199, where there was involved organizational picketing persisted in for five ...


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