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McCord v. Thompson-Starrett Co.

Supreme Court of New York, Appellate Division

December 11, 1908

McCORD
v.
THOMPSON-STARRETT CO. et al.

Morgan J. O'Brien, for appellants.

Frederick Hulse, for respondent.

Argued before PATTERSON, P. J., and INGRAHAM, LAUGHLIN, CLARKE, and SCOTT, JJ.

[113 N.Y.S. 386] SCOTT, J.

We find no difficulty in affirming this judgment if the Buildings Trades Employers' Association had gone no further than to order a general " lookout" of the members of the Brotherhood of Carpenters. The communication of September 22, 1904, however, does go further, and instructs the members of the association that no men may be set to work, or retained at work, who do not at once join a particular labor union, the Greater New York Carpenters' Union.

This requirement, if it is to be considered as the act of the association, was against public policy, illegal, and void ( Curran v. Galen, 152 N.Y. 33, 46 N.E. 297,37 L.R.A. 802,57 Am.St.Rep. 496; Jacobs v. Cohen, 183 N.Y. 207, 76 N.E. 5,2 L.R.A. [N. S.] 292,111 Am.St.Rep. 730). I see no reason why we are not bound to regard this requirement as the act of the association. By its constitution the board of governors is designated as the body which is authorized to act for the association, and to issue orders to the members. The complaint alleges and the court has found that the letter containing the objectionable order was " sent to said defendant by the said board of governors and certified by its secretary." It is true that the letter speaks of the emergency committee as directing that all carpenters then in the employ of a member, who are competent, shall become members, at once, of the Greater New York Carpenters' Union, and it does not appear who constitute the emergency committee or what power it possessed. But the same letter also contains the injunction, not purporting to emanate from the emergency committee, that no brotherhood carpenter, although willing to sign the arbitration plan, may be set to work unless he at once joins the designated union. Whether these instructions originated with the emergency committee or any one else, the board of governors by causing them to be subscribed by their secretary, and by sending them to the members of the association, adopted them, and made them their own. In so doing, as it seems to us, they exceeded their lawful authority, and undertook to impose upon the Thompson-Starrett Company an obligation which it was not required to assume. The bonds sued upon, although purporting to be given to secure liquidated damages, are in fact given to secure penalties for non-compliance with the order of the association, for it is apparent that the association, as such, could suffer no actual pecuniary damage from the disobedience of an order.

To collect a penalty for the disobedience of an order, it must appear that the order was one which was rightfully and lawfully given, and, as it appears that the association exceeded its authority in requiring that no carpenter should be employed unless he joined a particular union, it follows that the penalty cannot be collected. I do not understand that there is any serious difference of opinion between us as to the illegality of the directions to employ only members of one particular union. This seems to be established by the opinion of the Court of Appeals in Galen v. Curran, supra, reaffirmed and explained in Jacobs v. Cohen, supra.In the latter case Judge Gray, writing for the court, makes it quite clear that while an individual employer may lawfully agree with a labor union to employ only its members, because such an agreement is not of an oppressive nature operating generally [113 N.Y.S. 387] throughout the community to prevent craftsmen in the trade from obtaining employment and earning their livelihood, yet that such an agreement when participated in by all or by a large proportion of employers in any community becomes oppressive and contrary to public policy, because it operates generally upon the craftsmen in the trade, and imposes upon them, as a penalty for refusing to join the favored union, the practical impossibility of obtaining employment at their trade and thereby gaining a livelihood. The evidence makes it quite clear that the objectionable order of September 22, 1904, was of the latter class, for it is in evidence that the Employers' Association embraced nearly every prominent building contractor, and that the " lockout" affected practically the whole building trade in the borough of Manhattan. It is suggested, however, that even if the order to employ only members of the Greater New York Carpenters' Union was beyond the authority of the board of governors of the Employers' Association, still that the earlier orders which merely forbade the employment of members of the Brotherhood of Carpenters were authorized and lawful, and that the disobedience of these by defendants constituted a breach of the conditions of their bonds. Hence it is argued that the illegal order may be ignored and the forfeiture upheld by reason of the disobedience of the earlier orders, which are assumed to have been lawful. The difficulty with this argument is that the defendants did obey the earlier orders, and did lay off their employés in obedience to them. Indeed, for a long time after the issuance of the obnoxious order, they continued to lock out the members of the Brotherhood of Carpenters, and made efforts to obtain a sufficient number of carpenters from outside the membership of that organization. There certainly is no reason to suppose that, if defendants had filled up their working force with carpenters unaffiliated with any labor organization, the Employers' Association would have accepted their action as a compliance with its orders, for the violation of the illegal order of September 22, 1904, is expressly included in the bill of complaint as a reason for forfeiting the bonds sued upon.

The judgment appealed from must therefore be reversed, and a new trial granted, with costs to the appellant to abide the event.

PATTERSON, P. J., and LAUGHLIN, J., concur.

INGRAHAM, J. (dissenting).

This case was tried at Trial Term before the court, a jury having been waived. The appellant does not claim that the facts found were not sustained by the evidence. The court found that the defendant, the Thompson-Starrett Company, was a domestic corporation incorporated under the business corporation law in the year 1899 (Laws 1892, p. 2042, c. 691) for the purpose of conducting and carrying on the business of builders and contractors, and to perform engineering and architectural work, including the preparation of plans and specifications and expert work as acting and consulting and superintending engineers and architects; that prior to the 10th of June, 1904, a voluntary association was organized known as the " Building Trades Employers' Association," of which the defendant, [113 N.Y.S. 388] the Thompson-Starrett Company, was a member; that this association adopted what was called a constitution, which stated that the object of the association was to foster the interest of those engaged in the erection and construction of buildings and other structures, to reform abuses relating to the business of persons so engaged, to secure freedom from unjust and unlawful exactions, to obtain and diffuse accurate and reliable information as to all matters affecting such persons, to procure uniformity, harmony, and certainty in the relations existing between employers, mechanics, and laborers, and in all lawful ways to promote and protect the business interests of the members of the association, but that there was no intention, nor would there be any action on the part of the association, to control or in any way deal with prices or restrict competition; that there was to be a board of governors consisting of three representatives from each of the specified employers' associations and such other associations as might be provided for. This board of governors were to have power to--

" decide all controversies, difficulties and differences arising between members of the association and their employés, to determine and regulate the conduct of the members of the association relative to such controversies, difficulties and differences, and to decide all disputes and disagreements arising between the employers' association represented on the board of governors and employés' organizations. Also all controversies, difficulties and differences arising between different employers' associations represented on the board; to determine, regulate and control the conduct of such employers' associations relative to such disputes, difficulties and differences, and generally to determine, regulate and control the conduct of the members of this association and the employers' associations represented on the board in all matters pertaining to their relations with their employés, or in any and all matters affecting the building industry or the business interests in such building industry of the members of the association, and for this purpose to make general rules and regulations, provided, however, that where the controversy, difficulty or difference existing affects members of only one employers' association represented on the board of governors, the board of governors shall take no action except upon the request of the governors of the association in which the difficulty, difference or controversy exists. * * * The decisions, orders, prohibitions and regulations of the board of governors shall be final and obligatory upon each and every member of this association, and shall be complied with, obeyed and observed in good faith by every such member."

Article 10 provided that the--

" representatives from sixty (60) per cent of the associations represented on the board shall constitute a quorum for all business, except that of ordering a cessation or resumption of work by any or all of the members of this association. When the question of ordering a cessation or resumption of work by any or all of the members of the association is before the board, representatives from not less than seventy-five (75) per cent of the associations represented on the board shall constitute a ...


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