International Union of Operating Engineers, Local 68 v. Delaware River & Bay Authority

688 A.2d 569, 147 N.J. 433, 1997 N.J. LEXIS 42, 154 L.R.R.M. (BNA) 2501

• Court: Supreme Court of New Jersey
• Decided: February 11, 1997
• Status: Published

Opinions

The opinion of the Court was delivered by

POLLOCK, J.

This appeal raises two issues. The first is whether the New Jersey courts have jurisdiction over a Congressionally approved interstate (“CAI”) compact, specifically the compact between the states of New Jersey and Delaware (“the Compact”) creating the Delaware River and Bay Authority (the “DRBA”). If so, the second issue is whether the laws of New Jersey and Delaware are substantially similar concerning the right of public employees to negotiate collectively.

I.

The DRBA is a bi-state agency created by the Compact between New Jersey and Delaware and approved by Congress. N.J.S.A. 32:11E-1; Del.Code Ann. tit. 17, § 1701; Pub.L. 87-678, 76 Stat. 560 (1962). New Jersey and Delaware created the DRBA to advance their economic development and to improve the flow of traffic between the two states. N.J.S.A. 32:11E-1. Toward that end, the DRBA operates crossings between the two states including the Delaware Memorial Bridge and the Cape May-Lewes Ferry. Delaware River and Bay Authority v. International Org., etc., 45 N.J. 138, 140, 211 A.2d 789 (1965) (“International Org.”). Congress approved the Compact in 1962. Pub.L. 87-678, 76 Stat. 560. This case concerns the duty of the DRBA to negotiate collectively with its employees.

Among the many powers of the DRBA is the power in Article VII, Section (e) to:

[Alppoint, or employ, such other officers, agents, attorneys, engineers and employees as it may require for the performance of its duties and to fix and determine their qualifications, duties, compensation, pensions, terms of office and all other conditions and terms of employment and retention.

When the DRBA hires employees, it provides them with a copy of its Personnel Manual. Article XIV of the Manual states:

Upon accepting a position ... with the Authority, an individual becomes a public or governmental employee ... [i]n this connection, Authority employees have no right to incite, organize, conduct or participate in any strike, slowdown, or impediment to work against the Authority ... and neither does the Authority have the obligation to engage in collective bargaining with its employees or their chosen representative as may be unusual [sic] and legally done in private individual employment.

Although the DRBA refuses to recognize any obligation to bargain collectively with International Union of Operating Engineers, Local 68, AFL-CIO (“Local 68”), it recognizes that its employees may join labor unions. Thus, Article XV of the Manual provides:

The Authority fully recognizes the right of its employees to join a labor union of their own choosing and to organize, present and make known to the Authority any complaint or grievance which an employee might have in connection with employment____

On August 25, 1993, the D.R.B.A. Employee Association (“the Association”), representing ninety-eight DRBA employees, voted to affiliate with Local 68, a labor organization. On August 7,1993, Local 68 submitted a written request to the DRBA, seeking-recognition as the collective-negotiation representative for those employees previously represented by the Association. The DRBA denied that request. Between July 19 and September 9, 1993, a majority of DRBA employees signed authorization cards designating Local 68 as their exclusive representative. On October 7, 1993, Local 68 requested recognition as the collective-negotiation representative. The DRBA did not respond.

Local 68 then instituted this action. The complaint alleged that the DRBA’s refusal to recognize Local 68 as the collective-negotiation representative of certain DRBA employees interfered with the employees’ rights under the New Jersey Constitution and the labor laws of New Jersey and Delaware. Finding that it lacked jurisdiction to hear the matter and to grant the requested relief, the Chancery Division dismissed the complaint.

The Appellate Division reversed, holding that the Chancery Division had jurisdiction and that it could grant the requested relief. Essential to that holding was the Appellate Division’s conclusion that the labor laws of New Jersey and Delaware were complementary and parallel. We granted certification, 143 N.J. 311, 670 A.2d 1055 (1996), and now affirm.

II.

Article I, Section 10, Clause 3 of the United States Constitution (the “Compact Clause”) empowers states to enter into interstate compacts. U.S. Const, art. I, § 10, cl. 3. The Compact Clause provides “[n]o State shall, without the consent of Congress, ... enter into any Agreement or Compact with another state.... ” Ibid. That language is broad enough to prohibit interstate compacts entered without the consent of Congress. In practice, the clause applies only to those compacts that might alter the political power of the affected states, and thus interfere with the supremacy of the United States. Cuyler v. Adams, 449 U.S. 433, 440, 101 S.Ct. 703, 707, 66 L.Ed.2d 641, 649 (1981) (holding Compact Clause does not apply to agreements not “directed to the formation of any combination tending to the increase of political power in the States, which may encroach upon or interfere with the just supremacy of the United States”); Virginia v. Tennessee, 148 U.S. 503, 519-21, 13 S.Ct. 728, 734-35, 37 L.Ed. 537, 543 (1893) (distinguishing those compacts not encroaching upon federal power from those that may encroach upon that power).

Through interstate compacts, states can establish bi-state agencies. On receiving the consent of Congress, the agency becomes a creature of the creator states and the federal government. Hess v. Port Auth. Trans-Hudson Corp., 513 U.S. 30,-, 115 S.Ct. 394, 400, 130 L.Ed.2d 245, 255 (1994). Generally speaking, the mission of such an agency is to address “interests or problems that do not coincide nicely either with the national boundaries or with State lines [or] ... interests that may be badly served or not served at all by the ordinary channels of National or State political action.” Ibid.

Once sanctioned by Congress, a compact becomes a “law of the Union.” Pennsylvania v. Wheeling & Belmont Bridge Co., 54 U.S. (13 How.) 518, 566, 14 L.Ed. 249, 269 (1851). “Because congressional consent transforms an interstate compact within [the Compact Clause] into a law of the United States, ... the construction of an interstate agreement sanctioned by Congress under the Compact Clause presents a federal question.” Cuyler, supra, 449 U.S. at 438, 101 S.Ct. at 707, 66 L.Ed.2d at 648. Accord Carchman v. Nash, 473 U.S. 716, 719, 105 S.Ct. 3401, 3403, 87 L.Ed.2d 516, 520 (1985). Thus, the consent of Congress transforms the States’ agreement into federal law under the Compact Clause. Cuyler, supra, 449 U.S. at 440, 101 S.Ct. at 708, 66 L.Ed.2d at 649.

The DRBA argues that its Compact is a federal law and that only federal courts have jurisdiction to construe the compact. We must first determine therefore whether the compact is a federal law. If so, the next question is whether compacts deemed federal laws are subject to the jurisdiction only of the federal courts or to the concurrent jurisdiction of state courts.

One of the primary goals of the Compact is to improve the flow of traffic between Delaware and New Jersey. N.J.S.A. 32:11E-1. Congress’s interest in regulating interstate commerce renders the subject matter of the Compact appropriate for congressional legislation. U.S. Const, art. I, § 8, cl. 3. Thus, the Compact qualifies as a “congressionally sanctioned interstate compact the interpretation of which presents a question of federal law.” Cuyler, supra, 449 U.S. at 442, 101 S.Ct. at 709.

We recognize that the United States Supreme Court has original and exclusive jurisdiction in controversies between two or more states. 28 U.S.C.A. § 1251(a). See Kansas v. Colorado, 514 U.S. 675, 115 S.Ct. 1733, 131 L.Ed.2d 759 (1995) (invoking original jurisdiction over suit filed by one state against another relating to terms of CAI compact); Texas v. New Mexico, 462 U.S. 554, 103 S.Ct. 2558, 77 L.Ed.2d 1 (1983) (same); Guarini v. New York, 215 N.J.Super. 426, 521 A.2d 1362 (Ch.Div.), aff'd, 215 N.J.Super. 293, 521 A.2d 1294 (App.Div.1986), cert. denied, 484 U.S. 817, 108 S.Ct. 71, 98 L.Ed.2d 34 (1987) (refusing to assume jurisdiction over suit between two states, concluding that case was for exercise of original and exclusive jurisdiction by United States Supreme Court). Absent a controversy between two states or an express provision in a federal statute excluding concurrent jurisdiction, however, state courts may exercise jurisdiction over- cases arising under federal law. Gulf Offshore Co. v. Mobil Oil Corp., 453 U.S. 473, 477, 101 S.Ct. 2870, 2875, 69 L.Ed.2d 784, 791 (1981); Charles, Dowd Box Co. v. Courtney, 368 U.S. 502, 507-08, 82 S.Ct. 519, 523, 7 L.Ed.2d 483, 487 (1962). Nothing in the “federal system prevents state courts from enforcing rights created by federal law.” Courtney, supra, 368 U.S. at 507, 82 S.Ct. at 522, 7 L.Ed.2d at 487.

For years, moreover, both federal and state courts have construed the terms of interstate compacts. See e.g., NYSA-ILA Vacation & Holiday Fund v. Waterfront Comm’n of New York Harbor, 732 F.2d 292, 298 (2d Cir.), cert. denied, 469 U.S. 852, 105 S.Ct. 175, 83 L.Ed.2d 109 (1984) (holding congressional approval of Waterfront Commission Compact transformed it into federal law); Utah Int’l Inc. v. Intake Water Co., 484 F.Supp. 36, 42-43 (D.Mont.1979) (rejecting argument that federal jurisdiction over CAI compact construction cases is exclusive); Eastern Paralyzed Veterans Ass’n, Inc. v. City of Camden, 111 N.J. 389, 545 A.2d 127 (1988). At no time has the United States Supreme Com-t ruled that state courts do not have jurisdiction to construe CAI compacts. Implicitly recognizing the powers of state courts, the Court has written that it has the final say in compact-construction cases even when the matter concerns a question on which a state court has already spoken. Petty v. Tennessee-Missouri Bridge Comm’n, 359 U.S. 275, 278-79 n. 4, 79 S.Ct. 785, 788 n. 4, 3 L.Ed.2d 804, 808 n. 4 (1959). On occasion, the Court has even remanded a compact-construction case to a state court for reconsideration. State ex. rel. Dyer et. al. v. Sims, 341 U.S. 22, 32, 71 S.Ct. 557, 562-63, 95 L.Ed. 713 (1951) (holding West Virginia’s obligation under multi-state anti-pollution compact did not conflict with state constitution, and remanding case to state court).

In Hess, supra, moreover, the United States Supreme Court recognized that bi-state agencies are creatures of both the creator states and the federal government. 513 U.S. at-, 115 S.Ct. at 400, 130 L.Ed.2d at 255. The Court held that a federal court suit is “not an affront to the dignity of a Compact Clause entity.” Id. at-, 115 S.Ct. at 401, 130 L.Ed.2d at 256. It follows that a state-court action likewise does not affront a bi-state agency.

This ease presents a controversy between the DRBA and its employees, not one between two states. The case, therefore, does not invite the United States Supreme Court to exercise its original and exclusive jurisdiction. No express statutory provision prohibits the courts of Delaware or New Jersey from exercising jurisdiction over the DRBA. Unless a case involves a dispute between two states or an express statutory prohibition against the exercise of jurisdiction by the courts of either state, those courts may construe compacts concerning bi-state agencies.

III.

When a state signs a compact, a court of that state may not construe the compact absent the compact’s recognition of that state’s jurisdiction. Ampro Fisheries, Inc. v. Yaskin, 127 N.J. 602, 610, 606 A.2d 1099 (1992), cert. denied, 506 U.S. 954, 113 S.Ct. 409, 121 L.Ed.2d 333 (1992). Whether a creator state unilaterally may exercise jurisdiction over a bi-state agency depends, then, on the terms of the compact. Oklahoma v. New Mexico, 501 U.S. 221, 235 n. 5, 111 S.Ct. 2281, 2289 n. 5, 115 L.Ed.2d 207, 225 n. 5 (1991); Texas, supra, 482 U.S. at 128, 107 S.Ct. at 2283, 96 L.Ed.2d at 114 (1987).

Here, the Compact provides, in pertinent part:

Judicial proceedings to review any ... action of the authority ..., may be brought in such court of each state, and pursuant to such law or rules thereof, as a similar proceeding with respect to any agency of such state might be brought.

[N.J.S.A 32.-11E-1 (art. XV).]

Thus, the Compact’s plain language makes clear that the courts of New Jersey and Delaware have concurrent jurisdiction to review any action taken by the DRBA.

Over the last thirty years, the New Jersey courts have resolved many disputes, including labor disputes involving the DRBA. See International Org., supra, 45 N.J. 138, 211 A.2d 789 (affirming lower court’s order enjoining DRBA employees and their union representatives from striking or otherwise picketing); Delaware River & Bay Authority v. New Jersey Pub. Employment Relations Comm’n (“PERC”), 112 N.J.Super. 160, 270 A.2d 704 (App. Div.1970) (denying Public Employment Relations Commission’s authority to order DRBA to collectively negotiate with union absent compact provision conferring such jurisdiction; pending case in Delaware court voluntarily stayed pending outcome of New Jersey appeal); aff'd, 58 N.J. 388, 277 A.2d 880 (1971); Gauntt Constr. Co./Lott Electric Co. v. Delaware River & Bay Auth., 241 N.J.Super. 310, 314-15, 575 A.2d 13 (App.Div.1990) (acknowledging that Article XV of Compact provides courts of Delaware and New Jersey with concurrent jurisdiction to hear claims involving DRBA). We see no reason to reach a different result in the present case. Hence, we conclude that Article XV vests the courts of New Jersey and Delaware with concurrent jurisdiction over the DRBA’s labor disputes.

IV.

The next question is whether the courts of New Jersey may grant the relief that Local 68 seeks, including issuance of an order requiring, among other things, that the DRBA recognize Local 68 as the collective-negotiation representative for employees that the Association previously had represented. A single staté may not unilaterally impose additional duties on a bi-state agency. Eastern, supra, 111 N.J. at 398, 545 A.2d 127; Bell, supra, 83 N.J. at 424, 416 A.2d 829; PERC, supra, 112 N.J.Super. at 165-66, 270 A.2d 704. For example, DRBA employees do not have the right to strike, absent express approval by the New Jersey and Delaware Legislatures. International Org., supra, 45 N.J. at 148, 211 A.2d 789. A legislative grant to public employees of full collective-negotiation rights, including the right to strike, “must be deliberately expressed and is not to be implied.” Id. at 148, 211 A.2d 789.

Consistent with that premise, the Public Employment Relations Commission does not have jurisdiction to certify a union as the exclusive negotiating representative for DRBA employees. PERC, supra, 112 N.J.Super. at 166, 270 A.2d 704. Such jurisdiction “must be expressly given to [the Public Employment Relations Commission] by the Legislatures of New Jersey and Delaware, and not inferred by the courts.” Id. at 165, 270 A.2d 704.

Consequently, we have declined to subject the Delaware River and Port Authority (“DRPA”) to the requirements of New Jersey’s Tort Claims Act (“Act”), N.J.S.A. 59:1-1 to 12-3. Bell, supra, 83 N.J. at 425, 416 A2d 829. A contrary result would have granted the New Jersey Legislature power it did not possess, specifically, “the power to modify by unilateral action the waiver of sovereign immunity set forth in the bi-state compact.” Id. at 424, 416 A.2d 829.

More recently, we have construed the DRPA compact to mean that substantially similar statutes adopted by Delaware and New Jersey could constitute complementary legislation. Eastern, supra, 111 N.J. at 400, 545 A.2d 127. For example, in Eastern, the issue was whether New Jersey’s Law Against Discrimination (“LAD”), N.J.S.A. 10:5.1 to -42, as well as its construction laws concerning handicapped access, N.J.S.A 52:32-5, applied to the DRPA. Eastern, supra, 111 N.J. at 395-96, 545 A.2d 127. We concluded that the New Jersey laws did not apply because “neither creator state [may] unilaterally impose additional duties, powers, or responsibilities upon the Authority.” Id. at 398, 545 A.2d 127. To yield a more “just resolution” of the dispute, however, we remanded the matter to the Law Division to consider whether New Jersey and Delaware had jurisdiction based on complementary legislation within both states and implied consent. Id. at 400-01, 545 A.2d 127.

A bi-state agency, although subject to unilateral jurisdiction of a single creator state only when the compact recognizes the state’s jurisdiction, “may be subject to complementary or parallel state legislation that does not intrude on the mission of the agency.” Ampro, supra, 127 N.J. at 610, 606 A.2d 1099. Although a single state may not unilaterally impose its will on a bi-state agency, the creator states together may subject the agency to complementary or parallel state legislation. Eastern, supra, 111 N.J. at 400-01, 545 A.2d 127. Separate legislative acts are complementary or parallel if they are substantially similar in nature. Id. at 401, 545 A.2d 127. Legislation is substantially similar if the creator states evidence some showing of agreement in the laws involving and regulating a bi-state agency. Id. at 402, 545 A.2d 127. If the creator states do not enact complementary or parallel legislation, a court must make additional findings before concluding that the bi-state agency impliedly consented to regulation by one creator state. Ibid. Thus, a bi-state agency consents to a single creator state’s exercise of jurisdiction when the agency either voluntarily cooperates with the creator state in the exercise of jurisdiction or agrees to meet the requirements of the law of that state. Ibid.

In Bunk v. Port Auth. of New York & New Jersey, 144 N.J. 176, 180, 676 A.2d 118 (1996), the issue was whether a Port Authority of New York and New Jersey (“PANN”) worker was entitled to receive workers’ compensation benefits under the same limitations as apply to other public employees in New Jersey. Resolving that issue required the determination whether the provisions of New York and New Jersey for awarding workers’ compensation benefits were parallel and complementary. Id. at 185, 676 A.2d 118. Rather than “decide the exact contours of New York law,” we observed that there was “evidence in the record, ... that the provisions [were] somewhat similar.” Ibid. Thus, we held that New Jersey could impose its workers’ compensation laws on PANN to limit workers’ compensation benefits of a public employee receiving a disability pension under New York law for the same injury. Id. at 180, 676 A.2d 118.

The Delaware courts follow a similar practice. In Delaware River and Bay Auth. v. Carello, 43 Del.Ch. 213, 222 A.2d 794 (1966), the Delaware Chancery Court interpreted Article VII(e) of the Compact. Carello arose in 1966, two years before the New Jersey Legislature passed public employment legislation. Consequently, the Delaware court held that Delaware could not “unilaterally legislate so as to place burdens on the compact.” Id. 222 A.2d at 798-99. The court continued, however, that the Delaware statute would “remain ineffective until concurrent legislative action of a similar nature is taken by the state of New Jersey.” Id. at 799. The amendment of N.J.S.A. 34:13A-1 to -29, constitutes concurrent legislative action. Finally, Article VIII of the Compact recognizes that the DRBA may be subject to obligations other than those that the Compact specifies. Article VIII provides that the DRBA shall not undertake additional duties and obligations “under the law of either State or Congress without authorization by the law of both States.” Implicit in that provision is the premise that the two states may subject the DRBA to complementary or parallel legislation.

From the foregoing, we conclude that a bi-state agency, such as the DRBA, is subject to the law of New Jersey when the agency’s compact expressly provides for unilateral action, both states have adopted complementary or parallel legislation, or the agency has impliedly consented to the exercise of single-state jurisdiction.

V.

The final issue is whether the laws of New Jersey and Delaware are complementary and parallel with regard to collective negotiations for public employees. Both states have enacted laws to prevent labor disputes between public employees, thereby assuring the orderly and uninterrupted operations of public employers. N.J.S.A 34:13A-2; Del.Code Arm. tit. 19, § 1302. Both states grant public employees the right to join labor unions and to negotiate collectively through a representative of their own choosing. N.J.S.A. 34:13A-5.3; Del.Code Arm. tit. 19, § 1303. Finally, both states prohibit public employers from interfering with employees in the exercise of their rights and from refusing to negotiate in good faith with the employees’ majority representative. N.J.S.A. 34:13A-5.4; Del.Code Ann. tit 19, § 1307. The labor laws of New Jersey and Delaware, although not identical, are complementary and parallel. As a matter of public policy, the legislatures of both states have concluded that public employees should have the right of collective negotiation and that employers should not interfere with that right. In effect, the legislatures have modified the Compact. That modification should not interfere with the DRBA’s mission of advancing the economic development of the two states and improving the flow of traffic between them.

The dissent would deny DRBA employees the right of collective negotiation that the New Jersey and Delaware Legislatures have conferred on all public employees. In denying that right, the dissent misperceives judicial recognition of the legislative enactments in both New Jersey and Delaware as an attempt by the judiciary to amend the compact contrary to the will of the legislature. (Post at 448, 688 A.2d at 576). Contrary to the dissent, we merely recognize that the New Jersey and Delaware legislatures have adopted a substantially similar policy concerning collective negotiations by public employees. Anomalous indeed would be the failure to apply so important a policy to an entity created by both states for their mutual benefit. Unlike the dissent, moreover, we do not believe that recognizing the right of DRBA employees to negotiate collectively will “ ‘lead to discord and a destruction of the purposes for which such bi-state agencies are formed.’ ” (Post at 454, 688 A.2d at 579) (quoting PERC, supra, 112 N.J.Super. at 166, 270 A.2d 704).

Nor do we share the dissent’s lack of confidence in the ability of the Chancery Division to interpret labor law. (Post at 454-55, 688 A.2d at 579-80). Historically, courts have exercised equitable power to resolve labor disputes. See e.g., Local No. 11 of Int’l Ass’n of Bridge, Structural & Ornamental Ironworkers v. McKee, 114 N.J.Eq. 555, 169 A 351 (Ch.Ct.1933) (appointing receiver to manage union’s business until members could elect new officers); Fryns v. Fair Lawn Fur Dressing Co., 114 N.J.Eq. 462, 168 A 862 (Ch.Ct.1933) (holding Chancery Court had jurisdiction and that employer could not force employees to join a particular union). Even today, courts interpret labor law. See Douglas L. Leslie, ed., The Railway Labor Act 7 (BNA Books 1995) (describing courts as “gatekeepers” that define a labor dispute to determine whether to exercise jurisdiction, compel arbitration, or direct the union to the National Mediation Board). At some time, the New Jersey and Delaware Legislatures may adopt legislation designating an agency to resolve “the myriad of issues that will arise during the course of collective negotiations.” Ibid. Until such time as the legislatures make such a designation, however, the absence of such legislation does not deprive the Chancery Division of jurisdiction.

The judgment of the Appellate Division is affirmed, and the matter is remanded to the Chancery Division.