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July 7, 1980


The opinion of the court was delivered by: GILES


On February 7, 1980, plaintiff, Acme Markets, Inc. (hereinafter "Acme") filed a complaint and motion for a temporary restraining order to enjoin a planned work stoppage by defendant Union, International Association of Machinists and Aerospace Workers Local Lodge No. 724 (hereinafter "Union"). The Union represents the subject bargaining unit of Acme employees.

 Acme alleged that the planned work stoppage was in violation of the "no strike" and binding arbitration provisions of a valid subsisting collective bargaining agreement which had been ratified by the Union membership. By its terms, the alleged agreement was retroactive to May 27, 1979, the expiration date of the prior labor agreement. The strike action was scheduled to commence at midnight February 7, 1980.

 Jurisdiction was alleged under Section 301 of the Labor Management Relations Act, 29 U.S.C. § 185. Acme alleged that the labor dispute in question was arbitrable under the terms of the alleged labor agreement. The court was requested to enforce the "no strike" and binding arbitration contract provisions under the doctrine of Boys Markets, Inc. v. Retail Clerks, 398 U.S. 235, 90 S. Ct. 1583, 26 L. Ed. 2d 199 (1970).

 The Union countered that, although the issue in dispute would have been arbitrable under the provisions of the prior expired labor agreement, there was no present agreement in effect.

 Thus, the issue presented for this court's determination is whether a labor agreement came into existence upon Union ratification on October 14, 1979. Controlled Sanitation Corp. v. District 128 International Association of Machinists, 524 F.2d 1324 (3d Cir. 1976). For the reasons set out below, the court concludes there was an enforceable labor agreement and that the subject of the labor dispute between the parties arises thereunder and is arbitrable under the binding arbitration provisions. Accordingly, the injunction against the work stoppage shall be made permanent and arbitration shall be directed.


 On February 7, 1979, after hearing the factual representations and legal arguments of counsel, the court entered an order granting temporary injunctive relief against the planned work stoppage. In doing so, the court took into consideration a number of undisputed facts: (1) the parties' long collective bargaining history; (2) the parties' intention in the most recent negotiations to adopt all the provisions of the expired labor agreement, except as expressly modified; (3) modifications reduced to writing; (4) Union ratification and (5) following ratification, the parties continuation of work under the terms and conditions of the purportedly binding agreement, including payment and acceptance of benefit and wage improvements retroactive to May 27, 1979. The court concluded that the possibility of continuing irreparable harm to Acme by reason of a work stoppage which would affect its entire warehousing and retail operations in Philadelphia and the Delaware Valley outweighed any harm to the Union or its members which might result from the grant of temporary injunctive relief. The court also concluded there was a reasonable basis for believing that Acme could prevail on the merits.

 A hearing to determine if the temporary restraining order was improvidently granted was scheduled for February 11, 1980. Thereafter, Acme and the Union agreed that the outstanding order would remain in full force and effect until the court determined whether or not a labor agreement existed. After an evidentiary hearing on Acme's motion for preliminary injunction, the parties submitted proposed findings of fact and conclusions of law. The court finds as follows:


 1. Acme operates a chain of retail supermarkets, approximately 200 in number, in the Philadelphia and the Delaware Valley areas. (N.T. 48, 3/14/80). These stores sell to the general public such merchandise as meat, groceries, produce, dairy items, frozen foods and bakery products. (N.T. 49, 3/14/80).

 2. The Union is an unincorporated labor organization which represents, for collective bargaining purposes, about 40 Acme employees who are truck mechanics at a bakery facility in Philadelphia. (Id.)

 3. The Union is also the exclusive bargaining representative for all automotive maintenance and service employees employed by Acme in the Philadelphia area. (N.T. 51-52, 3/7/80).

 4. Acme is an employer within the meaning of Section 2(2) of the National Labor Relations Act, 29 U.S.C. § 152(2).

 5. The Union is a labor organization within the meaning of Section 2(5) of the National Labor Relations Act, 29 U.S.C. § 152(5).

 7. The truck mechanics represented by the Union have been assigned by Acme to work at the three Distribution Centers. At one of those Centers, designated as "D.C. 1," Acme operates a large truck maintenance garage known as the "Automain," where most of Acme's truck mechanics are employed. (N.T. 13, 3/7/80).

 8. Acme operates a specific fleet of Bakery trucks. For a period of time prior to the instant dispute, the bakery facility which manufactured the bakery products was located at D.C. 1 and the maintenance work performed on the bakery trucks was performed at the Automain, which is also located in D.C. 1. (N.T. 13, 3/7/80).

 9. In 1977 or 1978, Acme determined corporately that the D.C. 1 Bakery was obsolete and planned to move its bakery division to a site located on Blue Grass Road in Northeast Philadelphia ("Blue Grass"). (N.T. 13, 3/7/80). There is no evidence, though, that this decision was communicated to the Union prior to commencement of negotiations.

 10. Acme and the Union have maintained a collective bargaining relationship spanning many years.

 11. The parties had a three year collective bargaining agreement which expired by its terms on May 26, 1979, (Exhibit C-1). It was extended by mutual consent to allow the parties time to negotiate a new agreement, with the further understanding that the new agreement would be retroactive to May 27, 1979.

 12. Following their historical bargaining pattern, the parties intended to adopt in full the language of the provisions of the expired agreement, except as specifically modified, changed, amended or supplemented.

 13. Among the contract provisions which the parties fully intended to adopt in any new labor agreement were the following, which provide in pertinent part:


1.1 Except as expressly provided otherwise herein, the Company recognizes the Union as the sole bargaining agency for its automotive maintenance and service employees located in the Company's garages in Philadelphia, Pennsylvania, working in classifications set forth in Exhibit A, and coming within the ...

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