Rabouin v. National Labor Relations Board

L. HAND, Circuit Judge

(dissenting).

Section 102 of Chapter 120 of the Public Laws of 1947, 61 St. at L. page 152, provided that “the provisions of section 8 (a) (3) and section 8(b) (2) * * * shall not make an unfair labor practice the performance of any obligation under a collective-bargaining agreement entered into prior to the date of the enactment of this Act”. The Union’s strike called on September 10, 1947 would have been an “unfair labor practice” under the New Act except for the contract of 1946, which was still in existence and which made the strike one to enforce “the performance of” a valid “obligation” of Rabouin. On the other hand, if the contract came to an end, the “closed shop” became unlawful, and the strike also became unlawful. The Board found that during the negotiations which began on September 27, 1947, “the Union took the position that it would not terminate the strike unless Rabouin, among other things, W'Ould post a $5000 performance bond.” It also found that the Union’s insistence upon his posting the bond was itself an “unfair labor practice”; although it did not hold that it ended the contract. Rabouin agreed to post such a bond provided he could get one; but on October 2nd he wrote to -the Union that he could not “obtain such a bond”; that his “only alternative * * * is to resume operations without a labor agreement”; and that he would assume -that the Union would “not care to negotiate such an agreement and will start operations if I do not hear from you in writing by nine (9) A. M. October 6, 1947.” The Union did not answer this letter, but continued the strike until it was enjoined in January.

We must distinguish between a repudiation and what may have been the occasion of it. In the case at bar the Union’s repudiation was complete and unconditional; it declared that it would keep the men on strike as long as Rabouin did not post a bond, and while the men stayed out, no part of the contract could be performed, for it concerned only the employment of Union members by Rabouin. Such cases as Mobley v. N. Y. Life Insurance Co., 295 U.S. 632 , 55 S.Ct. 876, 878 , 79 L.Ed. 1621 , and N. Y. Life Insurance Co. v. Viglas, 297 U.S. 672 , 56 S.Ct. 615 , 80 L.Ed. 971 , decide that to be a repudiation the promisor’s statement must be “an unqualified refusal * * * substantially to perform according to the ■terms of his obligation”; and of course I agree. But that is exactly what the Union did; it declared that it would not “perform according to the terms of his obligation”, for it said that it would not let the men go back, unless a new term was added to those already agreed to. It would not, indeed, have made any difference whether the new term was trivial or important, in either case the Union would have refused to “perform according -to the terms of his obligation” as it stood; a promisor does not perform when he imposes upon his performance a condition to which the promisee has not agreed. However, if it made any difference, the term on which the Union insisted was anything but trivial; it changed Rabouin’s promises from unsecured to secured liabilities; it made it impossible for him to go on; and, as I have said, insistence upon it was important enough to be an “unfair labor practice.”

I agree that the Union did not break the contract and that Rabouin did; but that does not mean that after the Union repudiated it, any part of the. contract remained in existence. It has never been doubted that, when a promisee repudiates because of the promisor’s breach, the promisor is excused from performance of his counter promises (Restatement of Contracts, § 280(1) ). It makes no1 difference that the repudiation is because of the promisee’s own breach; indeed it must be in order to be valid. Moreover, the promisee may not repudiate by halves; he must repudiate in whole, or not at all. La Cueva Ranch Co. v. Brewer, 7 Cir., 283 F.Rep. 963, 964; Sylvania Industrial Corporation v. Lilienfeld’s Estate, 4 Cir., 132 F.2d 887, 893 , 145 A.L.R. 612 . True, he may retract before the promisor has acted on it (Restatement of Contracts § 280(2) and § 319), but the Union never retracted. What it *914 tried to do, and has so far been successful in doing, is, not to repudiate, but to force upon Rabouin a new contract. I do not understand the reasoning by which that result is reached; and indeed all that is relevant here is whether the contract of 1946 was in existence after October 6th; for if it was not the strike was unlawful.

My brothers do not suggest that when in § 102 Congress used the words “the performance of any obligation under a collective bargaining agreement,” it did not mean that the continued existence of “any obligation” should not be determined by the same principles that determine the duration of any other contractual obligation. I agree that, if this be not true, the Board would be free to disregard those principles, and decide whatever they thought would best conduce to effect the underlying purpose of the Ac-t. Yet even then I should say that, when 'Congress proscribed the “closed shop” in futuro and allowed it to survive only so far as the parties had already agreed to abide by it, it would not conduce to effect the purposes of the New Act to preserve the “closed shop,” when the common law would have deemed the parties to have put an end to it. The “policy” of the New Act was opposed to suoh contracts, and the Board was not free to assume the contrary. That would be my conclusion if my decision were unfettered, and I think that it would not be so fettered that I should not be free so to decide. Although we may not be justified in reviewing findings of -the Board upon issues in which they are better versed than we; * I should suppose that there must remain some area in which we may differ from the Board’s decision even upon a point of “policy”; and, if so, it would appear to me that, for the reasons I have tried to state, it would be wrong not to apply principles of common-law to the contract here.

However, I think that in this instance no question of “policy” can arise anyway. When Congress uses words of ordinary meaning in a statute, they should be construed to have those legal consequences which such words have in other settings, unless there is some sound reason for construing them otherwise. Quite aside from Congress’ expressed disapproval of the “closed shop,” it seems to me that the phrase, “obligation under a collective bargaining agreement,” must be taken to mean such an “obligation” as such an “agreement” would create, lasting only as long as it would at common-law; and that it did not mean by implication to incorporate such determinants as the Board might think would promote industrial peace. That would throw the reins completely upon the neck of the Board. It is the chance that the opposite view may be thought to have been decisive here — in spite of its absence in my brothers’ opinion — that gives this appeal more than a passing importance, if indeed its practical importance has not already altogether passed.

I express no opinion on the other points decided, because they become unimportant if I am right in what I have just said. ■I think that the order should be reversed so far as Rabouin petitioned to reverse it.

Phelps Dodge Corp. v. Nat. Lab. Rel. Board, 313 U.S. 177 , 61 S.Ct. 845 , 85 L.Ed. 1271 .