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Strauss v. Silvercup Bakers Inc.

decided: December 9, 1965.


Waterman, Moore, and Friendly, Circuit Judges.

Author: Moore

MOORE, Circuit Judge:

This is an appeal by Bakery Drivers Union Local 802 (the Union) from an order directing the Union to proceed to arbitration in its dispute with Silvercup Bakers, Inc. (Silvercup).

Members of the Union deliver Silvercup's products. Since 1951, delivery employees have been on a "Swing Operation," under which deliveries are made six days a week by employees, none of whom work more than five days a week. To make this possible, the Company employs a number of "swingmen" to fill in for their regular "Route Salesmen" on their days off. On August 6, 1965, the Company wrote to the Union stating that it proposed to change over to a system of delivery known in the trade as the " Drop Out Day System," under which the company would deliver only five days a week, making no deliveries on Wednesday. Adoption of this system would result in the probable loss of jobs for some 55 swingmen now employed by Silvercup.

The Union objected on the grounds that, under the collective bargaining agreement then in force, no changes in methods of delivery could be made without negotiation and mutual agreement. Silvercup requested arbitration; the Union declined on the grounds that the subject was one expressly excluded from arbitration by the collective bargaining agreement. Silvercup then brought suit to compel arbitration.

The relevant portions of the collective bargaining agreement, the interpretation of which is at the heart of this case, are as follows:

Article 19(a). There shall be arbitration for all disputes which may arise between the parties hereto, except that the arbitrator shall have no power to alter, amend, revoke, or suspend any of the provisions of this Agreement.

Article 24. The Union and the Employer recognize the changes that have occurred in retail food stores, i.e., their replacement at an accelerated rate by the large corporate and cooperative food chains, and accordingly it may be necessary to recognize the appropriateness of considering changes in delivery, merchandising and compensation methods.

In view of this, the Employer may at any time request a meeting with the Union, for the purpose of negotiating and mutually agreeing on different commission payments or other methods of compensation or delivery methods which may be desirable under such changed conditions.

In the event of such request, the parties will meet promptly for the purposes outlined above.

In the event the parties are unable to agree, the dispute shall not be subject to the Arbitration Procedure of this Agreement.

The district court granted its order to compel arbitration on two grounds: (1) that under the broad language of the arbitration clause, the question of arbitrability was for the arbitrator and not for the court; and (2) that in any case the exclusionary language in the last paragraph of Article 24 was not sufficiently specific for the court to rule that a switch to the drop-out day system was not a proper subject for arbitration.

We do not find the language of Art. 19(a) broad enough to make arbitrability a question for the arbitrators in this case. The Supreme Court, although strongly favoring arbitration of labor disputes in its many recent decisions on the subject, has nevertheless maintained that "the duty to arbitrate being of contractual origin, a compulsory submission to arbitration cannot precede judicial determination that the collective bargaining agreement does in fact create such a duty." John Wiley & Sons, Inc. v. Livingston, 376 U.S. 543, 547, 11 L. Ed. 2d 898, 84 S. Ct. 909 (1964). The courts have the duty to determine whether the reluctant party has breached his promise to arbitrate, United Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 574, 582, 4 L. Ed. 2d 1409, 80 S. Ct. 1347 (1960), unless the contract clearly manifests an intention that arbitrability should be decided by the arbitrator. See also Drake Bakeries, Inc. v. Local 50, American Bakery Workers, 370 U.S. 254, 8 L. Ed. 2d 474, 82 S. Ct. 1346 (1962) in which the Supreme Court held that the question of arbitrability was for the courts, even though the arbitration clause covered "any act or conduct or relation between the parties." Id. at 257 n. 2. Moreover, the juxtaposition of an "all disputes" clause in a collective bargaining agreement with a clause excluding certain disputes from arbitration suggests that the parties intended to have questions concerning the scope of the exclusion decided in the first place not by the arbitrator, but by the courts.

It is clear that a provision must be specific if it is to exclude a claim from arbitration, but it is not clear how specific the provision must be in order to have this effect. It is this area of ...

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