Petition for Writ of Certiorari — A. G. V. Associates, Inc. v. Cross

ee

Office Supreme Court, U.S,

FILED

ui. Be MAR 31 1965

JOHN F. DAVIS, CLERK i

SUPREME COURT OF THE UNITED STATES

No. 103 i

CAPITOL AIRWAYS, INC.,

Petitioner,

VS.

THE AIRLINE PILOTS ASSOCIATION

INTERNATIONAL,

Respondent.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

Jupson Harwoop,

515 Nashville Bank & Trust Building,

Nashwille, Tennessee,

Attorney for Capitol Airways, Inc.

B L. Muwemrmw,’., Iic., 1108 Oak Street, Kansas City, Mo. 64106, HArrison 31-3030

INDEX

Subject Index

TI iia sa ve sccsesminn tetova sc cncanreslainnrcerpsienisinaisenaiannaeaitiingnns 1

Opinions Below ..........----:--:::s:sceececeeceseeceeeenteeeeteeeesneetesetes ae

ee ao icin cdnnskewcbenvnsiansebamecserenetenaseninamnasanmasaosness

Questions Presented —............-.----cscececeeeeceeeeeeeeereeeeeettn 2

Bhatinte WiPON OG on. ..n.2-.na:-0nc- occ nrtccecennssoneeacennncsennnosannsosacsees 4

Statement of the Case ............-.----.-.c-:cc-nccsccseceessseenceeseeeses 5

Reasons for Granting the Writ -........-......--------------- 10

Argument Sento aan ne eRe CO ner CO ee 11

COMCIUSION _...........----2-0-------o-2-ne-ee-nesesesecenennennnsenenccssncarnenscoenes 23

Appendix—

(a) Opinion of Court of Appeals -........-.-..----- Al

(b) Opinion of District Court -....--..-------------- A4

(c) Judgment ..........---------:-eeeeeee einen Al7

(A) Judgment ~.....-.--..--------c-cecsccceeeeseeectereentesesseseneesnens Al19g

Table of Cases and Authorities Cited

Anniston Mfg. Co. v. Davis, 301 U.S. 337, 81 L. Ed. 1143 17

Brotherhood, etc., v. Atlantic Coast Line R. Co., 233

A ocierenn ae ad ae Siecpennaendiimenasietation pe 10

Dahlberg v. Pittsburgh and L. E. R. Co., 138 F.2d 121 10,17

International Association of Machinists v. Central Air-

lines, Inc., 372 U.S. 682. 10 L. Ed. 2d 67 -....... 5,8, 10, 11,15

Jones v. Central of ee Railway Company, 331

WG aioe sncenn sens cnnaeecsnanisesiteneetsvceemsenscmrenocietares 10

United Steelworkers v. American Mfg. Co., 363 US.

564. 4 L. Ed. 2d 1408 ..........-----------n-n--cee-nsecseseseereneeoees 21

United Steelworkers v. Enterprise, 363 U-S. 573, 4 L.

a: ab | >. ene nnnennnnEnrren nner Tc ae 21

United Steelworkers v. Warrior, etc., 363 U.S. 574, 4 L.

Wh Sa OI cn casi i 21

Washington Terminal Company Vv. Boswell, 124 F.2d

$35. 319 UWS. TBS nnn. anon nnn 10, 16

U. S. Code, Title 45, Secs. 151-188 -....... i, 2, 4,5, 11, 14, 15, 20

SUPREME COURT OF THE UNITED STATES

gE i ss sia

CAPITOL AIRWAYS, INC.,

Petitioner,

vs.

T-= AIRLINE PILOTS ASSOCIATION

INTERNATIONAL,

Respondent.

PETITION FOR A WRIT OF CERTIORARI TU THE

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

Petitioner, Capitol Airways, Inc., a Tennessee corpora-

tion engaged in business as an air carrier in both domestic

and international air service pursuant to authority issued

by the Civil Aeronautics Board, prays that the Writ of

Certiorari issue to review a decision of the United States

Court of Appeals for the Sixth Circuit entered on February

10, 1985.

The said decision holds that a decision of a System

Board of Adjustment created by collective bargaining con-

tract pursuant to the mandate of Section 184, Title 45, U.S.C.

must be enforced by the Federal District Courts if the col-

lective bargaining contract is susceptible of the interpreta-

tion placed upon it by said Board.

2

Since air carriers and their employees are governed by

the Railway Labor Act (Sections 151-188, Title 45,

U.S.C.), Petitioner insisted below and here insists that

it is'the duty of Federal District Courts in reviewing de-

cisions of System Boards of Adjustment to go further and

make an independent interpretatior. of the legal obligations

and rights of the parties.

OPINIONS BELOW

The opinion of the Court of Appeals is copied in the

Appendix hereto at page Al.

The opinion of the District Court is copied in the Ap-

pendix hereto at page A4.

JURISDICTION

The jurisdiction of this Court is invoked under 28

U.S.C., Section 1254(1).

The District Court is given jurisdiction by Section

1337, Title 28, U.S.C. and Section 2201, Title 28, U.S.C.

QUESTIONS PRESENTED

1. Whether, under the Railway Labor Act, air car-

riers are entitled to receive the same scope of judicial re-

view of decisions of System Boards of Adjustment as rail

carriers receive in actions to review decisions of divisions

of the Adjustment Board. Petitioner insists that the an-

swer should be “yes”.

9. Whether the failure to provide for Judicial review

of an order of a System Board of Adjustment is a denia} of

Due Process where the Air Carrier is compelled by statute

3

to enter into an agreement creating such System Board.

Petitioner insists that the answer should be “yes”.

3. Whether a Federal District Court, in reviewing an

order of a System Board of Adjustment created by a col-

lective bargaining contract pursuant to the Railway Labor

Act, is required to make an independent interpretation of

the legal obligations of the parties under the contract.

Petitioner insists that the answer should be “yes”.

4. Whether an airline may be required to reemploy

and pay lost wages to a discharged pilot who has not been

“exonerated” by the System Board of Adjustment where

the only contract provision dealing with the reemployment

of the discharged pilot provides “If as a result of any hear-

ing as provided herein, a pilot is exonerated, he shall, if

he has been held out of service, be reinstated without loss

of seniority and shall be paid for such time lost in an

amcunt which he would have ordinarily earned had he

been continued in service during such period”. Petitioner

insists that the answer should be “no”.

5. Whether an airline may be required by a System

Board of Adjustment to reemploy a captain pilot who was

discharged for attempting to smuggle goods into the United

States aboard the aircraft, where the said System Board of

Adjustment found that said captain was, in fact, guilty of

attempted smuggling, where the only provision of the col-

lective bargaining contract dealing with the reemploy-

nt of the discharged pilot provides, “If as a result of

any hearing—a pilot is exonerated—he shall be rein-

stated”. Petitioner insists that the answer should be “‘no”’.

STATUTES INVOLVED

Title 45, U.S.C., Sections 151-188, are the applicable

statutes. Section 181 makes all of the earlier sections of the

Railway Labor Act applicable to air carriers except Sec-

tion 153. Section 184, however. provides:

“It shall be the duty of every carrier and of its em-

ployees, acti::g through their representatives, selected

in accordance with the provisions of sections 181-188

of this title to establish a board of adjustment of juris-

diction not exceeding the jurisdiction which may be

lawfully exercised by system, group, OT regional

boards of adjustment under the authority of section

152 of this title.’ (Emphasis added)

“Section 153 referred to in the above qucted statute,

{ (p) states:

If a carrier does not comply with an order of a

division of the Adjustment Board within the time limit

in such order, the petitioner, or any person for whose

benefit such order was made, may file in the District

Court of the United States for the district in which

he resides or in which is located the principal operat-

ing office of the carrier, or through which the carrier

cperates, a petition setting forth briefly the causes for

which he claims relief, and the order of the division

of the Adjustment Board in the premises. Such suit

in the District Court of the United States shall proceed

in all respects as other civil suits, except that on the

trial of such suit the findings anc order of the division

oj the Adjustment Board shall be prima facie evidence

0° the facts therein stated. . . . The district courts are

empowered under the rules of the court governing

actions at law, to make such order and enter such

judgment, by writ of mandamus or otherwise, as may

be appropriate to enforce or set aside the order of the

division of the Adjustment Board.” (Emphasis added)

STATEMENT OF THE CASE

Petitioner is an airline overating in both domestic

and international air service. A number of years ago, re-

spondent was certified as the bargaining agent for Pe-

titioner’s pilots. This certification was made by the Na-

tional Mediation Board under the provisions of the Rail-

way Labor Act (Sections 181-188, Title 45, U.S.C.) After

certification a collective bargaining contract was entered

into between the parties and said contract “as been re-

newed from time to time, although the renewals did not

change the general provisions of the contract.

As a part of said collective bargaining contract and

pursuant to the requirements of Sectior. 184, Title 45,

U.S.C., a System Board of Adjustment was created for the

purpose of settling disputes which may arise between ihe

parties under the collective bargaining contract.

Prior to the decision of this Court in International As-

sociation of Machinists v. Central Airlines, Inc., 372 U.S.

682. 10 L. Ed. 2d 67, disputes invoiving four former pilots

of Petitioner had veen submitted to the System Board of

Adjustment and said System Board had entered various

Orders on behalf of said individuals as follo'vs:

1. Pilot Hull wes a Captain of a Trans-Oceantic Air-

liner, and on a flight from Frankfort, Germany, attempted

io smuggle tvo valuable musical instruments into the

United States without paying the applicable tax. These

instruments were packed in a carton which was labeled

“Spare Parts’. The instruments were discovered by the

Customs officials and when Hull realized the instruments

had been discovered he persuaded one of the steward-

sses who had not yet cleared Customs to hst the instru-

ments on her Declaration Form. Hull was discharged

6

after Petitioner investigated the matter and concluded that

Hull had attempted to smuggle the instruments into the

United States.

The System Board of Adjustment expressly found

that Hull was in fact guilty of attempted smuggling. In

so doing, the Board stated:

‘“Tnere is no question in my mind that Hull did at-

tempt to smuggle or bring the instruments into the

country without paying duty on them. Every bit of

evidence points in this direction.” (Appx. 69a)

The System Board also expressly quoted the pertinent

or cited contract clauses and rules and regulations. (Appx.

60a)

The only contract provision quoted or cited by the

System Board is Section 26 which is the only section in

the contract in which Petitioner agreed to re-employ a

discharged pilot. Sec. 26(c) (4) states:

“If as a result of any hearing or appeal therefrom as

herein provided, a pilot is exonerated, he shall, if he

has been held out of service, be reinstated without

ioss of seniority and shall be paid for such time lost

in an amount which he would have ordinarily earned

had he been continued in service during such period.”

Notwithstanding this clear provision of the contract

and without citing or referring to any ot er provision of

the contract or attempting to construe any other pro-

vision of the contract as authorizing such action, the

System Board ordered Petitioner to re-employ Hull but

without back pay.

Petitioner insisted below and insists here that when

the System Board failed to exonerate Captain Hull it had

no authority to require Petitioner to re-employ him. Peti-

a

i

tioner insisted below and insists here that its obligation

under the contract is not a severable ebligation but is entire

and that the System Board must either exonerate the pilot

and thereby order him reinstated with back pay or it must,

as a matter of law, sustain his discharge. The System Board

is not authorized to compromise the dispute and substitute

its own brand of industrial justice.

2. Pilot Gerhard was discharged and the record in

this case is rot so full as that in the Hull case. The entire

decision of the System Board is as foliows:

“That Robect M. Gerhard be given a disciplinary layoff

of three months, after which he should be reimbursed

for the time lost on the basis of his average earnings

for the three months period prior to December 20, 1960,

less his earnings during the period after the expiration

of layoff of three months. After the layoff of three

months Gerhard shall be reinstated with all rights.”

(Appx. 80a)

It should be noted that, in addition to ordering Gerhard

re-employed, a money award was made.

3. Carlin—The record in the Carlin case also is not as

detailed as in the Hull case. The decision of the System

Board states:

“Yes, the discharge was justified, but the penalty im-

posed was too severe and he should have been sus-

pended for a period of time instead of a complete dis-

missal”. (Appx. 78a)

“In this case the District Court, however, refused to en-

force the award on the ground that the System Board ex-

pressly found that the question of discharge was not timely

raised. The Court of Appeals, however, reversed the Dis-

trict Court in this regard holding that questions of proce-

dure are exclusively within the province of the Board.

8

- Petitioner’> position in this case is the same as in the

Hull and Gerhard cases, that is. the pilot wis not only not

exonerated, but the award shows clearly that he was guilty

of substantial misconduct.

Petitioner, however, further insists in the Carlin case

that the System Board award on its tace shows that the

requirements with reference to the timeliness of filing the

grievance was not met.

Shortly after his discharge, Carlin filed his claim on

May 3 and this claim only involved certain sums of money

he claimed were due him. This item was settled, but on

November 6 he amended his claim to include for the first

time the question of his discharge. The question of dis-

charge was not raised within the time previded in the ccn-

tract. In this regard the System Board stated:

“This Board is inclined to feel that there was ar im-

proper attempt to correct the letter of May 3 and that

the letter c’ November 6 was filed out of time and can-

not be given consideration. No satisfactory explanation

was made to this Board at the hearing, although re-

peated efforts were made to obtain an explanation. The

Board feels that this was outside the time limit by

injecting new raaterial into the controversy after the

time had expired.” (Appx. 78a-79a)

Since the System Board found as a fact that the ques-

tion of discharge was not raised within the time limit set by

the contract, Petitioner insisted and the District Court

found that the System Board was without jurisdiction to

hear the dispute.

4. Former Pilot Riley was avvarded $4,800.00.

Shortly after the decision of this Court in International

Association ef Machinists v. Central Airlines, supra, Peti-

tioner filed suit ‘1 the Federal District Court challenging

the validity of the four awards.

9

Respondent filed an answer and counterclaim seeking

enforcement of the four awards.

Both parties made motions for summary judgment and

the District Court granted Petitioner’s motion as to the

Carlin and Riley awards and granted Respondent's motion

“5 to the Hull and Gerhard awards.

Capitol duly perfected its appeal to the United States

Court of Appeals for the Sixth Circuit whereupon Respond-

ent filed a cross-appeal.

The Court of Appeals sustained the action of the Dis-

trict Court in the Hull, Gerhard and Riley cases but re-

versed the District Court in the Carlin case.

Under the present state of the record, therefore, Peti-

tioner is required to comply with the awards in the Hull,

Gerhard and Carlin cases and although the Carlin case in-

volved a procedural matter which was different from any

matter applicable to the other cases, the real question in

issue is the same in all three cases. In each of the three

cases the System Board of Adjustment failed to exonerate

the pilots of the misconduct leading to their discharge and it

is the insistence of the Petitioner that it has no obligation to

reemploy or pay lost wages to discharged pilots who are not

exonerated in accordance with the clear language of the

contract.

In disposing of the case, neither the District Court nor

the Court of Appeals at any point cited, mentioned or re-

lied upon the Railway Labor Act or any decision arising

thereunder although Air Carriers are expressly made sub-

ject to that Act.

Neither the District Court nor the Court of Appeals

found or held that the decisions of the System Board were

in accordance with the correct legal interpretation of the

10

contract but mereiy that the contract was susceptible to

such interpretation. In this regard the Court of Appeals

stated:

“In our opinion, the arbitration cause of the col-

lective bargaining agreement was susceptible of the

interpretation placed upon it by the Board and the dis-

trict judge was right in sustaining the Board.”

Petitioner insists that it was the duty of the District Court

to make an independent interpretation of Petitioner’s obli-

gations under the contract and it was error for the Court

to limit its consideration as was done.

REASONS FOR GRANTING THE WRIT

1. The decision of the Court of Appeals in this case is

in conflict with the decision of this Court in the case of

International Association of Machinists v. Central Airlines

Inc., 372 U.S. 682, 10 Law Edition 2d 67.

2. The Court of Appeais in this case nas decided an

important question of Federal law which has not but should

be expressly and specifically settled by this Court.

3. The decision of the Court of Appeals in this case

is in conflict with decisions of Courts of Appeals for other

Circ. .ts as follows:

1. Washington Terminal Company v. Foswell, 124 F.2d

335 (Affirmed by this Court 319 U.S. 733).

. Brotherhood, etc., v. Atlantic Coast Line R. Co., 253

F.2d 753 (Court of Appeals for the Fourth Circuit).

3. Dahlberg v. Pittsburgh and L. E. R. Co., 138 F.2d

121 (Court of Appeals for the Third Circuit).

bo

4. Jones v. Central of Georgia Railway Company. 331

F.24 649 (Court of Appeals for the Fifth Circuit).

11

In all of the foregoing cases the Courts of Appeals

specifically held that it was the duty of the District Courts

in reviewing orders under the Railway Labor Act to con-

sider the merits of the cases and not to restrict the scope

of review as was done by the Court of Appeals in the in-

stant case.

ARGUMENT

QUESTIONS 1 AND 3

(1) Whether, under the Railway Labor Act, air car-

riers are entitled to receive the same scope of judicial re-

view of decisions of System Boards of Adjustment as rail

catriers receive in actions to review decisicns of divi»ions

-of the Adjustment Board. Petitioner insists that the an-

swer should be “yes”.

(3) Whether a Federal District Court, in reviewing

an order of a Svstem Board of Adjustment created br a col-

lective bargaining contract pursuant to the Railway Labor

Act, is required to make an independent interpretation of

the legal obligations of the parties under the contract.

Petitioner insists that the answer should be “yes”’.

It is undisputed that the contract between the parties

hereto was entered into in compliance with the Mandates

of Section 184, Title 45, U.S.C.

. In regard to the creation of the System Board of Ad-

justment by the parties, the contract specifically provides

“In compliance with Section 204, Title 2. of the Railway

Labor Act, as amended, there is hereby established a Sys-

tem Board of Aajustment—” (Appx. 47a)

This Court in the Central Airlines case, supra, re-

peatedly referred to the requirements of the Railway Labor

Act. In the course of the opinion the Court stated:

12

“In 1936, Congress extended the Railway Labor

Act to cover the then smail-but-growing air transporta-

tion industry. 49 Stat. 1189, 45 U.S.C., §$ 181-160. Its

general aim was to extend to air carriers and their em-

ployees the same benefits and obligations available and

applicable in the railroad industry. But there was to

be a significant variation. The 1936 amendments made

applicable to the airlines all of the provisions of the

Railway Labor Act, excepting § 3, 45 US.C., § 153.

dealing with the National Railroad Adjustment Board;

but including § 1, 45 U.S.C., § 151, containing defini-

tions | 2, 45 U.S.C., § 152, the Act’s statement of pur-

poses; $§ 4 and 5, 45 U.S.C., $$ “54, 155, relative to the

National Mediation Board and its functions; and §§ 7, 8

and 9, 45 U.S.C., $§ 157-159, relating to voluntary ar-

bitration and emergency boards. § 202, 45 U.S.C., §

182. In the place of § 3, Congress provided in § 205,

45 U.S.C., § 185, that the creation of a National Air

Transport Board would be postponed until ‘in the judg-

ment of the National Mediation Board, it shall be nec-

essary to have a permanent board of adjustment... .’

Until the establishment of the national board for the

airlines industry, § 204, 45 U.S.C., § 184, required the

formation of system, group, or regional boards of ad-

justment:

‘It shall be the duty of every carrier and of its

employees, acting through their representatives, se-

lected in accordance with the provisions of sections 181-

188 of this title, to establish a board of adjustment of

jurisdiction nut exceeding the jurisdiction which may

be lawfully exercised by system, group, OT regional

boards of adjustment, under the authority of section

153 of this title.’ (Emphasis added)

The duty imposed upon the parties to create ad-

justment boards to settle grievances was more than a

casual suggestion to the air industry. The original

version of S. 2496, which, as amended, becime law, pro-

vided for voluntary boards of adjustment as in the

case of the railroads and extended the jurisdiction of

the National Mediation Board to minor as well as

+>

lo

major disputes. But upon the suggestion « “ > »e Na-

tional Mediation Board, its jurisdiction was ot ex-

panded, and the law as finally passed made compulsury

the establishment of the adjustment boards. Until ana

unless the National Mediation Board determined to cre-

ate a national board, the parties were placed under ‘he

statutory duty of establishing and utilizing system,

group, or regior.xl boards of adjustment for the pur-

pose of adjusting and deciding disputes arising under

existing contracts. (Emphasis added)

The obligation which £¢ 204 fastened upon the car-

riers and their employees cannot be read in isolation.

Its true significance must be drawn from its context

as part of the Railway Labor Act which itself draws

meaning from its history.”

The Court further stated:

“In view of the clearly stated purpuses of the Act

and of its history, reflecting as it does a steady con-

gressional intent to move toward a reliabie and effec-

tive system for the settlement of grievances, we be-

lieve Congress intended no hiatus in the statutory

scheme when it postponed the establishment of a Na-

tional Air Transpor. Adjustment Board and instead

provided for compulsory system, group, or regional

boards. Although the system boards were expected to

be temporary arrangements, we cannot believe that

Congress intended an interim period of confusion and

chaos or meant to leave the establishment of the Boards

to the whim of the parties. Instead, it intended the

» statutory command to be legally enforceable in the

courts and the boards to be organized and operated

con-istent with the purposes of the Act.” (Emphasis

added )

The Court further stated:

“More specifically, the provisions of a § 204 con-

tract, such as those governing the composition of the

adjustment board, the procedures to be employed as

14

to notice and hearing or for breaking deadiocks, or the

finality to be accorded board awards, are to be judged

against the Act and its purposes and enforced or in-

validated in a fashion consistent with the statutory

scheme.” (Emphasis added)

The Court fu.cher stated:

“The Act, its history, and its purposes lead us to

conclude that when Congress ordered the establish-

ment of system boards to hear and decide airline con-

tract disputes, it ‘intended the Board to be and to act

as a public agency, not as a private go-between; its

awards to have legal effect, not merely that of private

advice. Bower v. Eastern Airlines, Inc., 214 F.2d 623,

626 (C.A. 3d Cir.) ; Washington *erminal Co. v. Boswell,

75 App. D.C. 7, 1%4 F.2d 235, 244.”

The Court further stated:

“Whether Central must comply with the award

or whether, instead, it is impeachable, are questions

contrulled by federal law and are to be answered with

due regard for the statutory scherae and purpose.”

45 U.S.C. 184 compels the creation of a board of ad-

justment “of jurisdictions not exceeding jurisdiction which

may be lawfuily exercised by system, group or regional

boards of adjustment under the authority of section 153

of this title.”

if the scope of review of system board awards is more

limited than decisions of adjustment boards in railway

cases, then this necessarily enlarges their jurisdiction con-

trary to the express provision of the Statute.

That Congress intended the same scope of review in

Air Carrier cases is further demonstrated by the provi-

sions of 45 U.S.C. 185. In regards the National Air Trans-

port Adjustment Board said section provides:

15

“ _. hearings shall te held, findings and awards

made, stated served, and erforced, and the number

and compensation of any necessary assistants shall be

determined and the compensation of such emplo ‘ees

shall be paid, all in the same manner and to the same

ertent as provided with reference to the National Rail-

road Adjustment Board by section 153 of thi. title.”

(Emphasis added)

From the foregoing Petitioner respectfully insists that

this Court has in fact already ruled that the same rules for

enforcement of System Board of Adjustment awards as

are applicable in the railway industry apply to Air Car-

riers cases but since the Court did not by express terms

so rule, Petitioner insists that the Court should now ac-

cept jurisdiction of this case and specifically spell out for

the air industry just what scope of review it is entitled to

receive from the Federal District Courts. This Court only

recently in Central Airlines cleared the confusion of the

‘Federal jurisdiction in such cases and should now go fur-

ther and spell out the procedures applicable because this

is a ‘aatter which will of necessity arise numerous times

in the now vast air industry which is in operation through-

out the enure United States.

Petitioner further insists that this Court should ex-

pressly rule that Air Carriers are entitled to exactly the

same scope of review in District Courts as rail carriers

are afforded under 45 U.S.C. 153 and that such review

requires an independent interpretation of legal obliga-

tions under the contract.

QUESTION 2

(2) Whether the failure to provide for Judicial re-

view of an order of a System Board of Adjustment is a

denial of Due Process where the Air Carrier is compelled

16

by statute to enter into an agreement creating such Systern

Board. Petitioner insists that the answer should be “yes”.

If decisions of a System Boerd of Adjustment are bind-

ing on the courts as to either law or fact then the statute

would be unconstitutional. It must be remembered that

the System Board is not a public or governmental agency

but is a private agency created pursuant to the statutory

mandate. To permit such an agency to make either find-

ings or fact or legal determinations final and binding is a

denial of due process because neither the System Board

nor the procedures before such Board afford even the most

basic requirements of due process.

In Washington Terminal Company v. Boswell, 124

F.2d 235, affirmed 319 U.S. 733, the Court of Appeals

stated:

“Much of the argu:nent has been built around the

alleged inadequacy of the administrative proceeding

as complying with the requirements of due process,

particularly in the absence of formal pleadings, op-

portunity for examining witnesses uud cross examin-

ing them, opporturity for representation by counsel

and for oral argument. These things woul? be im-

portant, if the Board’s decisions were final in the legal

sense and for purposes of enforcement, as to either

facts or law. But, as has been shown, they have no

such quality.” (Emphasis added)

The Court further stated:

“The short answer, therefore, to the argument

that the administrative proceeding is wanting in due

process is that, if so, this is entirely immaterial. Any

failure in this respect is cured by the full and com-

plete opportunity which the carrier is given in the

enforcement suit to make its defense under all pro-

cedural and substantive guaranties of the Constitu-

tion.”

17

To the same effect the Court of Appeals for the Third

Circuit in Dahlberg v. Pittsburgh, etc., 138 F.2d 121, stated:

“If the Act should Le interpreted as precluding

consideration of the merits by the Court, serious

doubts as to its constitutionality would arise. Such

inter;retation would amount to vesting the Board

with full judicial power; and, as was said in a simi-

iar but other connection in the dissenting opinion in

Washington Terminal Co. v. Boswell, 75 U.S. App.

D.C. 1, 124 F.2d 235, 276, ‘There can be no valid

delegation of governmental power to non-govern-

mental agencies. Carter v. Carter Coal Co., 1936, 298

U.S. 238. The Adjustment Board, consisting of bi-

partisan groups paid by and set up to represent the

emp oyees and carriers respectively, is not a govern-

mental agency.’”

It must be remembered that the creation of the Sys-

tem Board of Adjustment and the agreement relative

thereto are not the results of a private voluntary agree-

ment but are the result of a mandatory requirement of the

Act. Therefore, the decisions arising unde’ the Labor

Management Relations Act regarding arbitration disputes

have no bearing whatever in this case because in those

cases the arbitration agreement was the voluntary act of

the parties rather than the result of a statutory require-

ment.

As pointed out in the decisions above quoted, the

statutory compulsion of settlement of dispw‘es without

the right to full judicial review raises very serious ques-

tions of consiitutional law.

This Court has held in numerous cases that in con-

struing a statute the Court will avoid a construction which

even raises a serious question of constitutional law. In

this regard in Anniston Mfg. Co. v. Davis, 301 U.S. 337,

81 L. Ed. 1143, the Court stated:

18

“We apply the familiar canon which makes it

our duty, of two possible constructions, to adopt the

one which will save and not destroy. We cannot at-

tribute to Congress an intsnt to defy the Fifth Amend-

ment or ‘even to come so near to doing so as to raise a

serious question of constitutional law.’ Federal Trade

Commission v. American Tobacco Co., 264 U.S. 298,

307, 68 L. Ed. 696, 701, 44 S. Ct. 336, 32 ALR. 786;

Panema R. Co. v. Johnson, 264 U.S. 375, 390. 68 L.

Ed. 748, 754, 44 S. Ct. 391; Blodgett v. Holden, 275

US. 142, 148, 72 L. Ed. 206, 210, 48 S. Ct. 105.” (301

U.S. 351, 352)

Certainly a construction of the statute which requires

a carrier to enter into an agreement for the establishment

of a System Board of Adjustment and which makes find-

ings of said Board final and binding without regard to the

fact that such Boards are not composed of lawyers, do not

follow legal procedures as to pleadings and evidence and

which completely ignore all basic principles of contract

construction would clearly be viclative of due process

guaranteed under the Fifth Amendment. A construction,

however, which affords full judicial review of tae orders

of such System Boards of Adjustment, certainly as to legal

questions, would eliminate the constitutional question.

Petitioner, therefore, respectfully insists that for the

Courts to limit the scope of review of orders of System

Boards of Adjustment as was done in the cases now be-

fore this Court is a denial of due process. If such is the

real intent of the statute then the entire statute is un-

constitutional but if a full and complete judicial review

is afforded then the statute is constitutional and valid.

19

UESTIONS 4 AND 5

(4) Whether an airline may be reauired to reemploy

and pay lost wages to a discharged pilot who has not been

“exonerated” by the System Board of Adjus.meni where

the only contract provision dealing with the reemployment

of the discharged pilot provides “If as a result of any hear-

ing as provided herein, a pilot is exonerated, he shall, if

he has been held out of service, be reinstated withcut loss

of seniority and shall be paid for such time lost in an

amount which he would have ordinarily earned had he been

continued in service during such period.” Petitioner in-

sists that the answer should be “no”.

(5) Whether an airline may be required by a System

Board of Adjustment to reemploy a captain pilot who was

discharged for attempting to smuggle goods into the United

States aboard the aircraft, where the said System Board of

Adjustment found that said captain was, in fact, guilty of

attempted smuggling, where the only provision of the col-

lective bargaining contract dealing with the reemployment

of the discharged pilot provides, “If as a result of ary

hearing—a pilot is exonerated—he shall be reinstated.”

Petitioner insists that the answer should be “no”.

The contract between the parties hereto has only one

section which in any way directly or ir-lirectly discusses

or even mentions the obligation of petitioner to reemplov

a*pilot who has been discharged. This section is Section

26. (Appx. 34a) The cnly portion of this section which in

any way contains a promise to reemploy is Sub-Section c(4)

and reads as follows:

“If as a result of any hearing o¢ appeal therefrom

as provided ..erein, a pilot is exonerated, he shall, if

he has been held out of service, be reinstated without

loss of seniority and shall be paid for such time lost in

20

an amount which he would have ordinarily earned had

he been continued in service during such period.”

(Appx. 36a)

It will be noted that this obligation is entire and not

severable and there is no way this section can be construed

to give a System Board authorit$ to fail to exonerate a

pilot of substantial misconduct and yet compromise the dis-

pute by ordering him re-employed but without back pay.

Neither the District Court nor the Court of Appeals at

any point or place held that a proper construction of the

contract would give the System Board authority to do what

it did in these cases but merely held that the contract was

susceptible to such interpretation.

Neither the District Court nor the Court of Appeals

cited or in any way referred to any decision arising under

the Railway Labor Act but relied solely upon decisions

dealing with arbitration cases arising under Section 301 of

the Labor Management Relations Act.

Petitioner insists that this alone was error because the

parties hereto are governed by the Railway Labor Act.

Furthermore, the provision of the contract creating the Sys-

tem Board states that it is made in compliance with Section

204, Title II (45 U.S.C. 184) (Appx. 47a) and also provides:

“Nothing herein shall be construed to limit, restrict

or abridge the rights or privileges accorded either to

the employees or to the employer, or to their duly ac-

credited representatives. under the provisions of the

Railway Labor Act, * * *” (Appx. 5la)

Without waiving the foregoing, petitioner insists that

the decisions of this court do not support the conclusions

reacned by the lower courts.

21

On June 20, 1960 this court decided three cases dealing

with enforcement of arbitration agreements. These cases

are United Steel Workers v. American Manufacturing Co.;

United Steel Workers of America v. Warrior, etc.; and

United Steel Workers v. Enterprise. All of these cases are

reported in 4 L. Ed. 2d beginning at page 1403, and in 363

U.S. beginning at page 564. /

The District Court quoted from the Warrior case

(Appx. 157a) as follows:

“An order to arbitrate the particular grievance

{contracting out work] should not be denied unless it

may be said with positive assurance that the arbitration

clause is not susceptible of the interpretation that

covers the asserted dispute. Doubts should be resolved

in favor of coverage.” At page 582.

It will be noted that this case involved an order to

arbitrate and not the enforcement of an arbitration award.

The only one of the decisions which involved enforce-

ment of an award is the Enterprise case. In that case, how-

ever, the court stated:

“Nevertheless, an arbitrator is confined to inter-

pretation and application of the collective bargaining

agreement; he does not sit to dispense his own brand

of industrial justice. He may of course look for guid-

ance from many sources, yet his award is legitimate

only so long as it draws its essence fror.: the collective

* bargaining agreement. When the arbitrators words

manifest an infidelity to this obligation, courts have no

choice but to refuse enforcement of the award.” (Em-

phasis added)

It will be noted that this court has never said that a

court must enforce an arbitration award that is contrary

to the plain provisions of the contract. If the contract is

susceptible of an interpretation reached by the arbitrator

22

using fundamental basic principles of contract construction,

then the court should enforce, but the court should not

ignore such legal construction principles in determining

whether the contract is susceptible of the arbitrator’s inter-

pretation. If this is not true, then no one can draw a con-

tract and know what it means.

In the case now before the Court, it is necessary to

ignore all basic principles of contract construction in order

to reach the conclusion that the awards are valid because:

1. Section 26 of the contract precedes Sectior. 27 which

was referred to by the District Court (Appx. 158a) as

authorizing the awards.

2. Section 26 deals specifically with discipline and dis-

charge while Section 27 merely provides:

“Any pil-* or group of pilots covered by this Agree-

ment who have a grievance concerning any action of

the Company affecting them, not settled in conference

with Compary officials, shall be entitled to have such

grievance handled in accordance with the procedure

established in Section 26 hereof fer investigation and

hearing or appeal.” (Appx. 37a)

It will be noted that even Section 27 expressly refers

to Section 26 and does not pretend to negative the con-

ditional requirements of Section 26.

3. The only promise to re-employ is a conditional

promise starting with the word “If”.

The distinction between this case and the Steel Work-

ers cases is clearly illustrated by a statement in the separate

opinion reported at 363 U.S. 569. There the opinion states:

“* * ® for the arbitration promise is itself a con-

tract. The parties are free to make that promise as

broad or as narrow as they wish, for there is no com-

23

pulsion in law requiring them to include any such

promise in their agreement.”

Here there is “compulsion in law” to create the System

Board.

CONCLUSION

Petitioner most respectfully insists that the lower courts

erred in failing to apply tne same scope of judicial review

as is applicable in raiiroud cases under the Railway Labor

Act.

The lower courts also misconstrued the decisions of this

Court in labor arbitration cases arising under the Labor

Management Relations Act.

Petitioner also most respectfully insists that the scope

of judicial : eview in airline cases involves a very important

question affecting the entire air industry and should be

settled by a decision of this Court.

Petitioner further respectfully insists that the decisions

of the lower courts are erroneous and should be reversed.

Respectfully submitted,

JuDSON HARWOOD,

515 Nashville Bank & Trust Building,

Nashville, Tennessee,

Attorney for Capitol Airways, Inc.