Petitioners Brief — Petty v. Missouri & Arkansas Railway Co.

IN THE

Supreme Court of the United States

OCTOBER TERM, 1942

No.

V. W. Perry . Oe

v.

Missourr anp Arkansas Rarpway Company _. Respondent

BRIEF IN SUPPORT OF PETITION FOR A

WRIT OF CERTIORARI

The opinion of the Supreme Court of Arkansas has

not been officially reported, but it appears in the record

at page

The date of the decree to be reviewed is February 1,

1943, and the date of the order denying a petition for re-

hearing is March 15, 1943.

The jurisdiction of this Court is invoked under the

Act of Congress of February 13, 1925, Chapter 229, 43

Statutes 936, Section 237B of the Judicial Code, 28 U.S.C.A.

Section 344(b) relating to the issuance of writs of cer-

tiorari to bring up fer review judgments of state courts

of last resort.

A concise statement of the case appears in the preced-

ing petition, which is hereby adopted and made a part of

this brief

EMO |

10

POINTS AND AUTHORITIES RELIED ON

I

It was the duty of the Supreme Court of Arkansas to

apply existing federal law in adjudicating the rights of

the parties under an agreement concerning rules, rates of

pay and working conditions entered into by the railroad

and its employees in accordance with the Railway Labor

Act,

Claflin v. Houseman, 93 U.S. 180, 23 L. Ed. 833;

Ex parte Worcester County National Bank, 279 US.

347, 49 S. Ct. 368;

United States v. Bank of New York and Trust Co.,

296 U.S. 463, 56 S. Ct. 348, 80 L. Ed. 331;

Hines v. Lowery, 305 U.S. 85, 59 S. Ct. 31;

£ Ex parte Bransford, 310 U.S. 354, 60 S. Ct. 947.

II

It was the duty of the Supreme Court of Arkansas to

construe the employment contract so as to give full effect

to the ultimate aim and purpose of the Railway Labor Act.

Bird v. United States, 187 U.S. 118, 47 L. Ed. 100;

Takao Ozawa v. United States, 260 U.S. 178, 43 8.

Ct. 65;

Gulf States Steel’ Co. v. United States, 287 U.S. 32,

53S. Ct. 69;

United States v. Powers, 307 U.S. 214, 59 S. Ct. 805;

United States v. American Trucking Associations, 310

U.S. 534, 60 S. Ct. 1059.

bas Raw Ce Wis Stee Te. ee a

ll

III

In applying the rule that the parties to a contract are

conclusively presumed to have contracted with reference

to the laws in existence at the time when, and at the place

where, the contract is made and to be performed, the ap-

plicable federal laws must be taken into account and, where

the federal law and state law are in conflict, the latter must

yield to the former, as being the supreme law of the land.

Kx parte Bransford, 310 U.S. 354, 60 S. Ct. 947;

Ilines v. Davidowitz, 312 U.S. 52, 61 S. Ct. 399;

IV

It was the purpose of Congress, in enacting the Rail-

way Labor Act, to provide a means for the orderly settle-

ment of labor disputes and avoiding industrial strife.

Virginian Ry. Co. v. System Federation No. 40, 300

U.S. 515, 57 S. Ct. 592.

V

The stipulation against discharge without a hearing

amounted to the expression, in contractual form, of the

mandatory provisions of the Railway Labor Act, and is

therefore valid and enforceable.

Railway Labor Act, 45 U.S.C., Chapter 8, Section 152;

State of Indiana ex rel Anderson v. Brand, 303 US.

95, 58S. Ct. 443.

tere |

12

VI

Stipulations against wrongful discharge, or without

a hearing, in employment agreements made pursuant to

the Railway Labor Act, have been construed by the fed-

eral courts to be valid and enforceable, and the State courts

are therefore bound to adopt such construction in order

to secure uniformity in the application of a federal statute.

Yazoo & M.V. R. Co. v. Webb, 64 F. (2d) 902;

Moore vy. Illinois Central R. Co., 24 F. Supp. 731;

Illinois Central R. Co. v. Moore, 112 F. (2d) 959;

Moore v. Illinois Central R. Co., 312 U.S. 630, 61 S.

Ct. 754;

Seaboard Air Line Railway Co. v. Horton, 233 US.

492, 58 L. Ed. 1062;

Chesapeake & O. Ry. Co. v. Kuhn, 284 U.S. 44, 52 S.

Ct. 45.

13

ARGUMENT :

It was the duty of the Supreme Court of Arkansas to

apply existing federal law in adjudicating the rights of

the parties under an agreement concerning rules, rates of

pay and working conditions entered into by the railroad

and its employces in accordance with the Railway Labor

Act,

In taking up and deciding the question of petitioner’s

rights under the Railway Labor Act, the Supreme Court of

Arkansas, in its opinion in this case, said:

‘‘Instead of presenting his claim to that tribunal

(the National Railway Adjustment Board), he elected

to bring his action in this state, where the decision of

this court in the Matthews case prevented his re-

covery.’’

The Matthews case referred to (St. Louis, I. M. & S.

Ry. Co. vy. Matthews, 64 Ark 398) was decided by the Su-

preme Court of Arkansas in 1897; nearly thirty years be-

fore Congress enacted the Railway Labor Act. It was

there held that a stipulation against discharge without

just cause, or without a hearing, was unilateral and unen-

forceable.

On August 1, 1935, the effective date of the contract

sued on by petitioner herein, the Railway Labor Act was

in full force, and had been in full force for nearly a decade.

It was still in force on February 1, 1943, the date the opin-

ion of the Supreme Court of Arkansas was rendered in

this case, and was still in full force on March 15, 1943, the

‘

see, |

14

date on which that court denied petitioner’s petition for

rehearing.

While conceding that petitioner had his remedy un-

der the Railway Labor Act, the Supreme Court of Arkan-

sas nevertheless misconstrued the scope of that remedy,

and of the Act, in holding that petitioner’s election to sue

in the State courts precluded him from invoking a sub-

stantial right accorded him by a federal law, and that he

was bound, instead, by the State rule as announced in the

Matthews case. Such holding is clearly at variance and in

conflict with the long established and well settled princi-

ple, as declared by this Court, that it is obligatory upon

the state courts to apply federal laws in all cases applicable.

‘‘Upon the state courts, equally with the courts of

the Union, rests the obligation to guard and enforce

every right secured by the Constitution and laws of

the United States whenever those rights are involved

in any suit or proceedings before them.’’

United States v. Bank of New York & Trust Co.,

296 U.S. 4638, 56 S. Ct. 348, 80 L. Ed. 331.

‘*The laws of the United States are laws in the

several States, and just as much binding on the citi-

zens and courts thereof as the State laws are.’’

Claflin v. Houseman, 93 U.S. 130, 23 L. Ed. 833.

‘*Congressional enactments in pursuance of Con-

stitutional authority are the supreme law of the land.’’

Hines v. Lowrey, 305 U.S. 85, 59 S. Ct. 31.

Also see:

Er parte Worcester County National Bank, 279

U.S. 347, 49 S. Ct. 368;

Ex parte Bransford, 310 U.S. 354, 60 S. Ct. 947.

F Kishprers

15

II

Tt was the duty of the Supreme Court of Arkansas to

construe the employment contract so as to give full effect

to the ultimate aim and purpose of the Railway Labor Act.

‘‘In the interpretation of statutes, the function of

the courts is easily stated. It is to construe the

language so as to give effect to the intent of Congress.’’

United States v. American Trucking Associations,

310 U.S. 534, 60 S. Ct. 1059.

The effectiveness of the Railway Labor Act depends

ultimately upon the enforceability of the employment

agreements concerning rules, rates of pay and working

conditions, made in accordance with the provisions of the

Act; and to deny validity to such agreements on the ground

that stipulations against wrongful discharge, embodied in

the agreements, renders them unilateral and unenforceable,

is to do violence to the very spirit and purpose of the Act.

And the employment agreements which result from the

collective bargaining authorized and commanded by the

Act are, in the final analysis, the goal toward which the

entire Act is directed. The collective bargaining, required

by the Act is but an intermediate step toward that end.

Surely, it is not to be presumed that Congress intended the

Railway Labor Act to be a promising highway leading to

nothing more substantial than a mirage.

‘There is a presumption against a construction

which would render a statute ineffective or inefficient,

or which would cause grave public injury or even in-

convenience.”’

United States v. Powers, 307 U.S. 214, 59 S. Ct.

805;

Bird vy. United States, 187 U.S. 118, 47 L. Ed. 100.

a eeeeeeeeeaeeeae—e—eEEyEryEyEeEeEIEYEYEewwrrrrrrereererererrrr

16

‘“‘When possible, every statute should be ration.

ally interpreted with the view of car rying out the legis-

lative intent.”’

Gulf States Steel Co. vy. United States, 287 U.S,

32, 53S. Ct. 69.

‘Tt is the duty of this Court to give effect to the

intent of Coneress. Primarily, this intent is aseer-

tained by giving the words their natural significance,

but if this leads to an unreasonable result plainly at

variance with the policy of the legislation as a whole,

we must examine the matter further. We may then

look to the reason of the enactment and inquire into

its antecedent history and give it effect in accordance

with its design and purpose, sacrificing, if necessary,

the literal meaning in order that the purpose may not

fail.’’

Takao Ozawa v. United States, 260 US. 178, 43

S. Ct. 65. :

III

In applying the rule that the parties to a contract are

conclusively presumed to have contracted with reference

to the laws in existence at the time when, and at the place

where, the contract is made and to be performed, the ap-

plicable federal laws must be taken into account and, where

the federal law and state law are in conflict, the latter must

yield to the former, as being the supreme law of the land.

The Railway Labor Act is in effect in all forty-eight

of the States. It is as much a part of Arkansas law as it

is a part of the laws of California or New York. As such,

it becomes a part of every contract of employment result-

ing from collective bargaining under the Act, regardless of

where the contract is made or to be performed. Further-

17

more, Where the State law is in conflict with the provisions

of the Act, the Act must prevail.

“The nature of the power exerted by Congress,

the object sought to be attained, and the character of

the obligations imposed by the law, are all important

in considering the question of whether supreme fed-

eral enactments preclude enforcement of State laws

on the same subject.’’

Hines v. Davidowitz, 312 U.S. 02, 61 S. Ct. 399.

“The declaration of the supremacy clause gives

superiority to valid federal acts over conflicting state

statutes,”’

Ex parte Bransford, 310 US. 39.4, 60 S. Ct. 947.

‘IV

It was the purpose of Congress, in enacting the Rail-

way Labor Act, to provide a means for the orderly settle-

ment of labor disputes and avoiding industrial strife,

“Its (the Railway Labor Act) major objective is

the avoidance of industrial strife.’”’

Virginian. Ry. Co. vy. System Federation No. 40,

300 U.S. 515, 57 S. Ct. 592.

V

The stipulation againsi discharge without a hearing

amounted to the expression, in contractual form, of the

mandatory provisions of the Railway Labor Act, and is

therefore valid and enforceable.

Subdivision 1, 45 U.S.C, Chapter 8, Section 152, reads

as follows:

18

“Tt shall be the duty of all carriers, their offic ers,

agents and employees to exert every reasonable ef-

fort to make and maintain agreements cone erning

rates of pay, rules, and working conditions, and to

settle all disputes, whether arising out of the applica-

tion of such agreements or other Wise, in order to avoid

any interruption to commerce or to the operation of

uny carricr growing out of any dispute between the

carrier and the employees thereof.”

Section (d) of Article 32 of the agreement sued on by

petitioner reads as follows:

‘Knginemen shall not be discharged suspended or

demerits placed against their records until they have

had a fair and impartial hearing before an officer

of the Company. At such hearing they may be repre-

sented by an employee of their own choice or by the

regularly constituted committee of their organization,

The representative of the man involved in the hear-

ing shall have the right to introduce witnesses and

interrogate any witness giving testimony at the in-

vestigation. It found not euilty he shall be returned

to the service and paid for time lost.’’

This stipulation is clearly in line with the provision ot

the Act quoted above and also with the provision of Sub-

division 2 of the same section of the Act which reads:

‘All disputes between a carrier or carriers and

its or their employees shall be considered, and, if pos-

sible, decided, with all expedition, in conference be-

tween representatives designated and authorized so

to confer, respectively, by the carrier or carriers and

by the employees thereof interested in the dispute.’’

In other words, the statutory requirements have been

incorporated into the agreement; the Act has become part

of the contract by express terms. The stipulation is there-

Stes.

19

fore valid and enforceable. The Act not only makes it

the duty of the carrier to make agreements concerning

rates of pay, rules and working conditions, but also to

maintain such agreements. In this connection, the only

reasonable and logical construction to be placed on the

word ‘‘maintain’’ is that the carrier shall ‘faanere to’’,

“support’’, ‘‘uphold’’, and consider itself bound by, the

agreement in all its terms. Any construction to the con-

trary would vitiate the entire contract.

In the case of State of Indiana ex rel Anderson vy,

Brand, 308 U.S. 95, 58 S. Ct. 443, this Court had before it

the question of the validity of an indefinite term teacher's

employment contract, authorized by Indiana statute. The

federal question before the Court in that case was whether

not a subsequent repealing act, which repealed the act au-

thorizing such indefinite term contract 8, Was in violation

of the Constitutional prohibition against legislation im-

pairing the obligation of contracts. The Court, in its

opinion, stated that, as in most cases involving the impair-

ment clause, it) was primarily necessary to determine

Whether or not there was a valid contract. The Court there-

upon found that the indefinite term contract, as authorized

by the Indiana Legislature, was valid.

A fortiori, a contract authorized by federal law, and

containing provisions directly in line with the require-

ments of the federal law, must nee essarily, if the law it-

self is constitutional, be valid as to such bioatbidins and

its validity extends throughout the forty-eight States

alike, state law to the contrary, notwithstanding.

20

VI

Stipulations against wrongful discharge, or without

a hearing, in employment agreements made pursuant to

the Railway Labor Act, have been construed by the fed-

eral courts to be valid and enforceable, and the State courts

are therefore bound to adopt such construction in order

to secure uniformity in the application of a federal statute.

The question of the validity of stipulations against

wrongful discharge has been before the federal courts on

at least two occasions and, in each instance, their validity

upheld. And both of the cases referred to were decided

prior to the decision in petitioner’s case. In the first of

these cases, decided by the Circuit Court of Appeals, Fifth

Circuit (Miss.) it was said of such agreement:

“But the employment though indefinite as to

time is a relationship while it lasts, and is subject to

the conditions fixed in the working agreement for the

1 te i , ° ie “o Sor

industry. Thus a worker cannot be discharged fot

‘auses prohibited by the agreement or without a hear-

ing if that is provided... .’’

Yazoo & M.V.R. Co. v. Webb, 64 FB. (2d) 902.

In the second of the two cases, the United States Dis-

trict Court (Mississippi) in construing such stipulations

against wrongful discharge, held the contract to be valid.

Moore y. Illinois Cent. R. Co., 24 F. Supp. 731.

Upon appeal of that same case to the Circuit Court of

Appeals, Fifth Circuit, it was there held that such stipula-

tion was valid and enforceable. In this connection, the

court said:

21

‘The provision in the collective agreement for a

hearing before the carrier’s officers, with appeal to

the highest, is in line with the requirements of the

statute ....

‘““We find in these provisions a clear implication

that discharge is not to be at the emplover’s will, but

only for a just cause.”

Illinois Central R. Co. v. Moore, 112 F. (2d) 959.

The Circuit Court of Appeals held, however, that the

cause of action was barred by the statute of limitations

and, on that ground alone, reversed the judgment of the

District Court.

The case was then brought to this Court on certiorari.

And, once again, the sole question upon which the decision

rested Was the question of limitations. This Court held

that the Cirenuit Court of Appeals erred in refusing to eon-

sider itself bound by the Mississippi court’s interpreta-

tion of its own statute of limitations. For that reason, the

judgment of the Circuit Court of Appeals was reversed

aud the judgment of the District Court affirmed,

Moore ve Ilimois Cent. Re. Co., 812 US. 630, 61 S. Ct.

TO4.

If, then, there is to be uniformity in the application

of federal law, it must follow that the interpretation, by

the federal courts sitting in one State, of the substantive

rights aecorded by an Act of Congress, should be con-

trolling upon all state courts when the same question, aris-

ing under the same Act, is before them for consideration.

Any rule to the contrary could only lead to endless eon-

fusion in the interpretation and application of federal

law, and the rights of the parties would depend entirely

3

22

upon local law. Thus, if petitioner could have brought his

suit in Mississippi, the rule as announced in the Webb and

Moore cases, supra, would have resulted in a judgment in

his favor. But, being precluded from suing in Mississippi

for jurisdictional reasons petitioner was obliged to main-

tain his action in Arkansas, with the result that the same

federal right is denied him.

“And where Congress enacts a law within the

limits of its power, that law should be enforced uni-

formly throughout the entire United States.”

Seaboard Air Line Railway vy. Horton, 235 US.

492, 58 L. Ed. 1062.

‘‘Moreover, in proceedings under that act (Ied-

eral Employers’ Liability Act), wherever brought, the

rights and obligations of the parties depend upon it

and applicable principles of common law as _ inter-

preted and applied in the federal courts.”’

Chesapeake & O. Ry. Co. v. Kuhn, 284 U.S. 44, 52

S. Ct. 45.

Sear

23

CONCLUSION

The judgment of the Supreme Court of Arkansas

draws into question the rights and obligations created by

an Act of Congress conceded to be valid; denies those

rights and obligations; and is probably not in aecord with

the applicable decisions of this Court. It is respectfully

submitted that the judgment of the Supreme Court of

Arkansas should be reversed, and the cause should be re-

manded to that court with directions to enter a judgment

reversing the judgment of the Circuit Court of Woodruff

County, Arkansas, and remanding the cause to said court

with directions to overrule the demurrer of respondent to

petitioners’s complaint, and for further proceedings not

inconsistent with this Court’s opinion herein.

Respectfully submitted,

W. R. Doxnuam

Sam M. Wasseuu

Counsel for Petitioner