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June 16, 1976


The opinion of the court was delivered by: TEITELBAUM

This is an action brought by plaintiff under the Labor Management Relations Act of 1947 (29 U.S.C. § 185) to recover compensatory and punitive damages for the defendant company's alleged breach of a collective bargaining agreement and the defendant union's alleged breach of its duty of fair representation.

 The case arises out of plaintiff's employment as a boat pilot (i.e., captain) for the defendant company from March, 1970 through December, 1971. Plaintiff alleges that during this period he was paid less than the prevailing wage rate under the applicable collective bargaining contract between the company and the defendant union. Plaintiff asserts that he did not become aware of this circumstance until he was transferred to another vessel, where he worked as a pilot under the same labor contract, but received greater compensation in that capacity than as pilot on the previous assignment. He avers that he brought this matter to the attention of the company and later referred it as a grievance to the union, but that the union refused to process the grievance, and indeed took no affirmative action on it.

 Both defendants, company and union, deny liability. The company contends that it paid plaintiff the full wage scale applicable to his employment throughout the relevant period; that the operative labor agreement between it and the union contemplated a different wage scale for "small boat" pilots than for "big boat" pilots; and that the wage rate to which plaintiff claims entitlement applied only to pilots of big boats. The company asserts that the labor contract at issue inadvertently omitted the wage rates pertaining to small boats, but that the practice of the company and union was to maintain a differential in pay between pilots of small and big boats; that at no time prior to plaintiff's claim was the practice questioned; and that at no time was there an agreement that pay rates for small and big boat pilots would be identical.

 The contentions of the defendant union track those of the company. In addition, however, the union avers that it did not proceed to arbitration with plaintiff's claim because its investigation of the grievance revealed the company's position to be correct, and that it did not engage in any bad faith or arbitrary conduct regarding plaintiff's grievance.

 On April 5 and 19, 1976, in a non-jury proceeding, the Court heard evidence relating to the various contentions set forth above. The following shall constitute the findings of fact and conclusions of law required by F.R. Civ. P. 52(a):

 Defendants entered into written contracts covering Crain's employees for three-year periods, the pertinent agreements being dated September 23, 1966, September 23, 1969 and September 23, 1972. The September, 1966 contract provided for pay rate differentials for Crain tow boat employees based on the horsepower of the boat. The September, 1969 contract covering tow boat employees did not provide for a pay differential based on horsepower. The September, 1972 contract provided for a pay rate differential between large boats and small boats.

 The September, 1969 tow boat employee contract was negotiated by Edward Zelinski, former business agent for the union, and Clifford H. Crain, for the company. At the time of these negotiations, Zelinski, for the union, sought to combine the wage rates for all tow boat employees. Crain, however, refused to agree to the proposal, and a pay rate differential based upon boat size rather than horsepower was then agreed to by the union and the company. *fn1" The written contract which was intended to embody defendants' September, 1969 agreement was typed by the union; due to a clerical error, occasioned by inadvertence and oversight, the pay rate for small boat employees was omitted from the written instrument.

 During the term of the September, 1969 agreement, in accordance with the understanding of the contracting parties, Crain paid wage rates which recognized a differential between large and small boat employees, and all employees of Crain were paid in accordance with this big boat-small boat rate differential. Thus, during the period covered by the September, 1969 agreement that plaintiff worked as pilot on the Motor Vessel Roy L, he was paid the rate agreed upon by Crain and the union for small boats.

 In September, 1972, plaintiff Dishman notified the company and a representative of the union of his grievance, asserting that he had not been paid the hourly wage rate specified in the 1969 labor agreement for hours served as pilot on the Motor Vessel Roy L. Discussions were held concerning Dishman's grievance between Crain and Richard Ward, who succeeded Zelinski as business agent for the union prior to the filing of plaintiff's grievance and negotiation of the 1972 labor contract. Both Zelinski and Crain advised Ward that a pay rate differential between large and small boats had been negotiated and agreed upon by defendants, but inadvertently omitted from the September, 1969 labor contract when that contract was typed. Clifford Crain confirmed these facts in a March, 1973 letter to Ward. Ward's communications with Zelinski and Crain caused him to conclude that the company's position was correct and that plaintiff's grievance was groundless.

 A meeting was arranged in March, 1973 to advise Dishman of the results of the union's investigation of his grievance. Dishman did not appear. Attempts by Ward to contact plaintiff by telephone proved fruitless, and Ward was advised in the course of one call that Dishman no longer worked for Crain, but was seeking work in Ohio.

 No employee of Crain other than plaintiff has filed any grievance regarding rates of pay for small boats.

 The critical aspect, then, of plaintiff's claim for breach of contract is not the intention of the defendant parties to the 1969 tow boat contract or the substance of their true agreement, but rather whether parol evidence is admissible to show defendants' actual agreement -- a wage rate differential based on vessel size -- in the face of an indisputably integrated contract that makes no mention of such a pay differential. In considering this question, the Court is fully mindful of the exclusionary impact of the Parol Evidence Rule where parol is offered to add to or modify an integrated agreement. But I am no less mindful of the near-axiom that the Rule is quite simply inoperative in instances where parol evidence is offered for the purpose ...

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