Felix Frankfurter

“ There is perceived very little reason why the Federal courts should now be opened to so wide a degree, inviting litigation, when rules presently in existence effectively permit suit and may, in the sound discretion of the United States Supreme Court, be broadened even further to permit suit regardless of State procedural laws and without the necessity of further legislation. ”

“ By offering easy access to the courts in cases where a breach of a collective-bargaining agreement is alleged, it would act as an inducement to litigate every alleged grievance, and would result in a flood of litigation making the courts again the battlefield for industrial disputes, increasing rather than eliminating the acrimony and conflict between the parties. In addition, your committee wishes to point out the fallacy of a widely held notion that breaches of contract are most often committed by labor organizations and employees. ”

“ Thus a labor organization would not be liable for damages arising as a result of an unauthorized strike carried on in violation of a contract. If a union or an officer thereof did not authorize the strike or participate in it, or support it, or subsequently approve it, no liability would be imposed on the union as a consequence of the work stoppage. To protect the employer against work stoppages in violation of an agreement but not approved by the union, employees who take part in such strikes would lose their status as employees under sections 8, 9, and 10 of the National Labor Relations Act. ”

“ The amendment under discussion is designed to make it easier for employers to bring suit against labor unions. Do the Members of the Senate realize that it is almost impossible for a labor union to sue an employer for breach of contract? Collective-bargaining agreements are generally construed either as contracts between the employer and the employees or contracts for the benefit of the employees. In either case injured employees must usually sue for themselves. A union may not bring suit because it has no interest in the matter. ”

“ No; the recognized bargaining agent is the union, not the officers of the union; it is the union, and the union is usually an unincorporated association. The point I was trying to make is that if you want to sue an unincorporated association in many States it is almost impossible to get them into court, because they have requirements that you have to serve every member, and you can't reach them, you can't find them in many cases. So the whole thing is delayed, and it is a long and tedious problem, if it can be done at all. ”

“ I do not think anyone is justified in giving labor unions legal immunity when they practice coercion, or when they seek to exercise the secondary boycott, or when they engage in violence, or when they seek to evade their responsibility for damages with which they may rightly be charged. ”

“ One of the purposes of organizing and collective bargaining is to make a contract by management and the workers. This bill provides that management and labor each shall fairly and honestly live up to the terms of their contract and if either party breaks the contract and the other suffers loss or damage thereby, the party who is at fault must respond in fair and just damages. If the parties do not intend to live up to their contract, why should they take the time, trouble, and incur expense of making a contract? ”

“ The objection to suits against labor organizations has stemmed from a proper resentment against the travesty that took place in the old Danbury Hatters case where individual members of a union were harried and their property attached to satisfy a judgment for action taken by officers whom they did not control. It was as bad as such action would be against minority and individual stockholders of a corporation for acts they could not control. ”

“ The Court, however, sees no problem of 'judicial power' in casting upon the federal courts, with no guides except 'judicial inventiveness,' the task of applying a whole industrial code that is as yet in the bosom of the jidiciary. There are severe limits on 'judicial inventiveness' even for the most imaginative judges. ”

“ Senator Taft:
'This is a perfectly reasonable bill in every respect. If we are to have free collective bargaining it must be between two responsible parties. Some of the provisions of this bill deal with the question of making the unions responsible. There is no reason in the world why a union should not have the same responsibility that a corporation has which is engaged in business. So we have provided that a union may be sued as if it were a corporation. ”

“ Analysis of the 'protective jurisdiction' theory might also be attempted in terms of the language of Article III-construing 'laws' to include jurisdictional statutes where Congress could have legislated substantively in a field. This is but another way of saying that because Congress could have legislated substantively and thereby could give rise to litigation under a statute of the United States, it can provide a federal forum for statecreated rights although it chose not to adopt state law as federal law or to originate federal rights. ”

“ Even in these States, however, whether labor unions are included within the definition of 'association' is a matter of local judicial interpretation.
'It is apparent that until all jurisdictions, and particularly the Federal Government, authorize actions against labor unions as legal entities, there will not be the mutual responsibility necessary to vitalize collective-bargaining agreements. The Congress has protected the right of workers to organize. It has passed laws to encourage and promote collective bargaining. ”

“ Actually, there are only 13 States where union funds cannot be easily reached under laws in effect permitting satisfaction of judgments from the central funds of the union. * * * Of the remaining 35 States, there are 10 which by statute permit the union assets to be reached by representative suits in any type of action and there are 25 which permit suits against unions in the common name of the union, in some cases with liability attaching not only to the union funds, but also to the assets of every individual member of the union. ”

“ It is not the first time that unions have conveniently disregarded, when it suited an immediate end, their vehement feelings that secured the restriction upon the federal courts in granting injunctions in labor disputes. ”

“ The United States Supreme Court has held that the fact that the circumstances involve engaging in interstate commerce will not permit the Federal courts to assume jurisdiction where there is no diversity of citizenship (In Re Metropolitan Railway Receivership, 208 U.S. 90, 28 S.Ct. 219, 52 L.Ed. 403.) It is therefore concluded that this aspect of the bill constitutes an approach which is of doubtful legality and certainly is both hasty and unwise.
'It is noted that the bill makes an effort to secure union responsibility for the acts of its agents. Very general language is used. ”

“ Congress heeded the resistance of organized labor, uncompromisingly led in its hostility to this measure by Andrew Furuseth, president of the International Seamen's Union and most powerful voice expressing labor's fear of the use of this remedy against it. [2]
Even though the Court glaringly ignores the Arbitration Act, it does at least recognize the common-law rule against enforcement of executory agreements to arbitrate. It nevertheless enforces the arbitration clause in the collective-bargaining agreements in these cases. ”

“ Insofar as state law governs the case, Professor Mishkin's theory is quite similar to that advanced by Professors Hart and Wechsler and followed by the Court of Appeals for the First Circuit: The substantive power of Congress, although not exercised to govern the particular 'case,' gives 'arising under' jurisdiction to the federal courts despite governing state law. The second 'protective jurisdiction' theory has the dubious advantage of limiting incursions on state judicial power to situations in which the State's feelings may have been tempered by early substantive federal invasions. ”

“ President, the minority views picture a dark future for a party who wishes to enforce an agreement with a labor union. Actually the picture given is quite misleading. For instance, it says that an employer or even the Government has no Federal right of action to enforce a collective bargaining agreement. ”

“ It should also be noted that whatever may be a union's ad hoc benefit in a particular case, the meaning of collective bargaining for labor does not remotely derive from reliance on the sanction of litigation in the courts. ”

“ Labor organizations cannot justifiably ask to be treated as responsible contracting parties unless they are willing to assume the responsibility of such contracts to the same extent as the other party must assume his. Public opinion polls in evidence before the committee show that nearly 75 percent of the union members themselves concur in this view. For this reason, not only does the section, as heretofore pointed out, make the labor organization equally suable, but it also makes the Norris-LaGuardia Act inapplicable * * *. ”

“ All we provide in the amendment is that voluntary associations shall in effect be suable as if they were corporations, and suable in the Federal courts if the contract involves interstate commerce and therefore involves a Federal question. As a matter of fact, labor unions in theory are responsible for their contracts. At times they have been sued, including actions for tort. ”

“ The only advantage, if indeed it may be called an advantage, is to give many disputing parties an otherwise unavailable opportunity to choose a Federal forum rather than a State forum. The substantive law governing the settlement of the dispute would not be changed in the least no matter which forum were chosen. ”

“ The difficult nature of the problem of construction to be faced if some federal rights are sought was set forth in Westinghouse, where the constitutional questions were involved only in their bearing on the construction of the statute. Now that the constitutional questions themselves must be faced, the nature of the problem bears repeating.
Legislation must, if possible, be given a meaning that will enable it to survive. This rule of constitutional adjudication is normally invoked to narrow what would otherwise be the natural but constitutionally dubious scope of the language. ”

“ Mishkin, 53 Col.L.Rev., at 193: 'Without doubt, a federal forum should be available for all suits involving the Government, its agents and instrumentalities, regardless of the source of the substantive rule.'↑ Enunciation of such a requirement could in fact bring federal law somewhat further to the forefront than was true of Osborn, the Pacific Railroad Removal Cases, or the bankruptcy cases in the few cases where an assertion could be made that state law did not sufficiently recognize collective agreements as contracts. ”

“ The minority believes this provision, imposing equal responsibility on both parties to such contracts, is absolutely essential to the stability of labor relations. The only argument so far advanced against it is that some employers might embarrass unions by suits for enforcement of contract. ”

“ It is not possible to bring each and any case into the United States courts. * * * The Federal courts were created solely for the purpose of handling special matters which are appropriately in the jurisdiction of a Federal agency. Thus, suits involving rights of a citizen under Federal statute may go to a Federal court. Suits involving citizens of more than one State may go to a Federal court under appropriate circumstances. ”

“ On the contrary, most breaches of contract are by employers. As has been elsewhere stated at greater length in this report your committee feels that labor disputes should be settled by conference, negotiation, and compromise, and not by the use of mandatory judicial processes. * * *' (Pp. 8-9.)
b. Minority (Senators Ball, Taft, and H. Alexander Smith) :
'Amendment No. 3 (the minority proposal) would make unions suable as legal entities in the Federal courts for violation of contract, with liability limited to union assets and not enforceable against individual members or their property. ”

“ If we expect confidence in agreements made, there must be responsibility and integrity on both sides in carrying them out.'
'If unions can break agreements with relative impunity, then such agreements do not tend to stabilize industrial relations. The execution of an agreement does not by itself promote industrial peace. ”

“ Speaking as a lawyer and former member of the Federal judiciary, I have an objection to the abandonment in this field of the requirement of the $3,000 amount in controversy as a prerequisite to Federal jurisdiction. ”

“ Now of course, this section doesn't carry any injunctive procedure; but there, at least, the Supreme Court seemed to recognize that a union might be made the object of an action as an association without reaching the individual members.
'Senator Taft. This would carry to a civil injunction process if it were one generally usable under laws of equity, I think, when you say it is binding and enforceable; whatever the equitable remedies might be in that State, or might be considered proper by the court, could be used. ”